The Cost Of War VS. The Cost Of College
The concept that is at the foundation of the study of economics is scarcity. When I first studied this subject in high school -- and later taught it as a social studies teacher -- I learned that we had an unlimited number of wants in a finite economic reality that could only fulfill a small fraction of these desires. One of the ways this concept of scarcity is expressed is in the inverse relationship between guns and butter. Guns represented everything the economy generates in terms of war or defense, while butter represents consumer goods and services. To the extent that any society has more of one they necessarily have less of the other.
As a practical application of these functions, one might look at the failure of the old Soviet Union. The Soviet Union could not keep pace with the arms build up of the post war that the Cold War required, because the base of its GNP was much smaller than the of the United States. The United States could rebuild its economy after the Great Depression and WWII because it spent a much smaller percentage of its GNP on guns than it did on butter, even though this amount was equal to or greater than what the Soviets could afford given their GNP.
