‘Guns Versus Butter’ is Passé; Now It’s ‘Guns Versus Virtue’

Basic economics courses often refer to the tradeoff between “guns or butter,” referring to the tension between spending on defense versus domestic programs. There is no question that the U.S. has, in recent years, vastly expanded its welfare state, particularly under cover of the pandemic. Programs now completely out of date are kept on life support because nobody likes losing “goodies.” America’s national debt has soared and now exceeds $43 trillion for the first time in history.

On the “guns” side of the ledger, the “peace dividend” that supposedly justified a pullback of U.S. defense spending in the 1990s following the end of the Cold War is long gone. International tension and threats abound today, including ambitious China, bellicose Russia, unpredictable North Korea, the tumultuous Middle East, and the fear of a nuclear Iran. If we were concerned about Iran as a backer of anti-West proxies, consider what the U.S. is investing in two of its proxies: Ukraine and Israel. As those proxies drain our war supplies, replacements are costly.

But “guns versus butter” is no longer the most important tradeoff we face. Arguably, it is now “guns versus virtue.” We are squandering literally trillions of dollars on various kinds of virtue signaling that produces little or no benefit. These monies should be redirected into defense immediately.

What kind of virtue signaling? The quintessential example is the Green New Deal, more aptly titled the Green New Scam. We don’t question that human endeavors are causing climate change, but instead of responding with effective programs, we are throwing money onto a giant bonfire. That might warm the hearts of politicians, but few, if any, of our very expensive programs and policies will make any material difference to the Earth’s climate.

At the nation-to-nation level, we are spending our way into excessive dependence on our enemies while giving them a pass on climate action. The U.S. is accountable for under 15% (and shrinking) of world carbon emissions, while China’s share is 27% and growing. Asia is at 53% compared with 35% for all of the Americas and Europe. Our dependence comes from two sources: the importation of energy, mainly oil, when we could be producing it ourselves; and the total Chinese dominance of the market for minerals necessary for our suicidal electrification plans.

More specifically, our leaders have adopted two major policy directions that will have limited to little effect on greenhouse gas emissions. The first is to rely upon “renewables” – wind and solar power – to displace fossil fuels. This will help up to the point where the intermittency of renewables becomes unaffordable because of the cost of backup power, either through subsidizing idle fossil fuel plants or purchasing ever more batteries, thereby driving their cost through the roof due to limited mineral availability. Texas has already proposed subsidies for gas-fired electrical plants to back up their also-subsidized wind power.

In fact, in only a few settings have renewables been cost-competitive with fossil-fuel-based electricity. Most projects would collapse, as many have already done, without massive subsidies for construction and operation. All the while, the glaringly obvious, feasible route to lowering greenhouse gas emissions -- small-scale nuclear power plants -- is being ignored, despite needing relatively modest financial support to accelerate the design and deployment of new and scalable approaches to nuclear. Over 150 U.S. naval ships have operated on nuclear power for many decades without incident -- real-world examples of the feasibility of reducing carbon emissions using this approach.

The other relevant government policy direction is so nonsensical that it defies any explanation except virtue signaling – namely, electric vehicles (E.V.s). Trillions of dollars have been or will be spent for subsidies in the short term, attempting to force E.V.s onto largely unwilling consumers. But this strategy is utterly misguided, because the push for more E.V.s is actually accelerating greenhouse gas emissions in the short term due to the mining of the minerals necessary for E.V. batteries. 

The math is revealing: It is necessary to drive an E.V. for 10-15 years for the tailpipe emissions savings to offset those from manufacturing, even assuming the batteries and the cars in which they sit last that long. And that does not consider any battery recycling, the emissions, and financial cost to create an adequate charging infrastructure, which we are decades and trillions of dollars from achieving, or the leverage China will have over the automotive industry. E.V.s are the very definition of a “boondoggle.”

The bottom line is simple: Stop arguing about “butter.” Instead, discontinue all the useless subsidies for renewables and E.V.s, redirect a small portion toward accelerating small-scale nuclear, and devote the substantial remainder to “guns” to cope with an increasingly perilous world. In a world in which rational policymaking trumped virtue-signaling, this would be utterly obvious.

A previous version of this article was published last year in the Washington Examiner.

Andrew I. Fillat spent his career in technology venture capital and information technology companies. He is also the co-inventor of relational databases. Henry I. Miller, a physician and molecular biologist, is the Glenn Swogger Distinguished Fellow at the American Council on Science and Health. They were undergraduates together at M.I.T.