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Eisenhower Guns vs Butter Discussion

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In a speech before the American Society of Newspaper Editors (April 16, 1953), President Eisenhower stated: "Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. This is not a way of life at all in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron."

Please comment and express concurrence with President Eisenhower by arguing/explaining his view.

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Solution Preview

The essence of President Eisenhower's speech is about mis-allocation of resources. It is about whether to invest in gun or in butter. The choice of country's resources is either should go for security or for food. Due to limited resources, investment in one area will take up resources for investment in others. If factors of production, like labor and capital, are channeled towards investing in industries that will ...

Solution Summary

A nation has to make wise decision on where to allocate its limited resources. It has to decide, for example, how much to invest in "gun" and how much in "butter". President Eisenhower was concerned on too much resources allocated for war related activities. This was not beneficial for the society at large.