A term coined by economist Robert Higgs that describes the problem in governance that arises when government intervention increases during crises such as wars, natural disasters, or economic depressions. After the crisis government meets resistance in reversing the intervention, creating a situation where government intervention rarely returns to pre-crisis levels, which lead to a constant ratcheting up effect in growth of government intervention over time.
Robert Higgs - Liberty and the Long Run Growth of Government
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MAY 21, 2009 by ART CARDEN
What about World War II? Did it end the Great Depression? More generally, is war good for the economy? I answer both in the negative and borrow here from Ludwig von Mises: "War prosperity is like the prosperity that an earthquake or a plague brings." As Higgs points out, because of the array of interventions in the wartime economy, war materiel was valued incorrectly and therefore the GDP data overstate economic conditions. Moreover, conscription and arms production gave a misleading employment picture