A large proportion of it is just destroyed. Along with human lives. Sure the money seems to come back around, but that's an accounting trick: it's printed by the guys paying anyway. The human labour and lives invested are gone, unless what they did is one of the fraction of the work permitted to spill into civilian life. A million man hours go into a warship's hull alone. What else could those hands and minds have done?

You can fund medical research without spending a million dollars sending a man to a desert, having his legs blown off, and flying him home. Hell, the US especially could actually use that research on civilians without bankrupting them!

And what about rebuilding bombed out cities? Is there so little else to improve?