We’ve grown fat on the butter – but we need guns too

Peaceniks have increasingly restrained Western military might, to the benefit of general living standards. But we live in a new bellicose era – we’d be wise to invest in defence, says Jonathan Compton.

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Among the vast range of futile economic constructs, one of the worst still drummed into students and recycled unthinkingly in the media is the "Guns and Butter" theory. This essentially states that an economy must choose between defence (guns) or consumption (butter), but you can't have ample amounts of both.

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Jonathan Compton was MD at Bedlam Asset Management and has spent 30 years in fund management, stockbroking and corporate finance.