In macroeconomics, the guns versus butter model is an example of a simple production–possibility frontier. It demonstrates the relationship between a nation's investment in defense and civilian goods. The "guns or butter" model is used generally as a simplification of national spending as a part of GDP. This may be seen as an analogy for choices between defense and civilian spending in more complex economies. The nation will have to decide which balance of guns versus butter best fulfills its needs, with its choice being partly influenced by the military spending and military stance of potential opponents. Researchers in political economy have viewed the trade-off between military and consumer spending as a useful predictor of election success. In this example, a nation has to choose between two options when spending its finite resources. It may buy either guns (invest in defense/military) or butter (invest in production of goods), or a combination of both. Origin of the term One theory on the origin of the concept comes from the decision to expand munitions before the US entered World War I. In 1914 the leading global exporter of nitrates for gunpowder was Chile. Chile maintained neutrality during the war and provided nearly all of the US's nitrate requirements. It was also the principal ingredient of chemical fertilizer in farming. The US realized it needed control of its own supply. The National Defense Act of 1916 directed the president to select a site for the artificial production of nitrates within the United States. It was not until September 1917, several months after the United States entered the war, that Wilson selected Muscle Shoals, Alabama, after more than a year of competition among political rivals. A deadlock in the Congress was broken when South Carolina Senator Ellison D. Smith sponsored the National Defense Act of 1916 that directed "the Secretary of Agriculture to manufacture nitrates for fertilizers in peace and munitions in war at water power sites designated by the President." This was presented by the news media as "guns and butter." Tax expert Albert Lepawsky stated in 1941, "Contrary to the popular slogan, it is not a question of guns versus butter" because basic food supplies will not be cut. He explained: Reducing non-defense consumption as a whole, however, may play fully as important a role as increasing the nation's production. Indeed, for the first World War, it was estimated by John M.