Special Section: Where Did the Peace Dividend Go?

FOR the U.S. economy, peace will provide a modest but significant bonus—and only minor dislocations. Previous postwar conversions were economic turning points: consumers rushed to buy goods that had been scarce during the fighting, and the Government choked off defense spending in favor of domestic projects. By contrast, the Viet Nam War never required quite enough of the nation's output to cause such shortages in civilian goods, and the U.S.'s spending on it has shrunk considerably in the past three years. Says Economist Edward Fried of...