The classic demolition of this argument, and of the economic value of make-work in general, was performed by Fredic Bastiat. My favorite thought experiment of his concerned a proposed railroad from Paris to Marseilles. Politicians in Lyons argued that the line should have a break there, since it would stimulate the businees of innkeepers and teamsters (the former would get overnight stays, while the latter would make money hauling goods from one railway terminal to the other). Bastiat was enchanted. Why not two breaks in the railway? he asked. Or ten? In fact, why not have a railway consisting entirely of breaks?