The Bush administration is unveiling a new budget asking for $515 billion in defense spending. You’re going to be reading a lot of headlines in coming days such as “Rising Cost of Iraq War May Reignite Public Debate” and “Proposed Military Spending is Highest Since WWII.”
It’s true that we’re spending a lot of money on defense in absolute terms, but is it unaffordable? That’s like asking if a 7-series BMW is expensive. The answer is: It depends. For someone making $50,000 a year, a 7-series is prohibitively expensive. For someone making $5 million a year it’s cheap.
When it comes to defense spending, keep in mind that the United States is the richest country in the world, with a GDP of $13.75 trillion. That makes defense spending look pretty affordable, especially when compared to the cost of losing in Iraq and watching a region with the world’s leading oil reserves spin out of control.
The key fact to keep in mind may be found in this chart. It notes that even counting supplemental war spending, the defense budget still equals only 4 percent of GDP—1.5 percentage points lower than the average of the past 40 years.
It is in fact because we are so rich that our wars cost so much. It is possible to fight for much less, but the result would be higher casualties, as the Canadians, who have stinted on defense spending for years, are finding out in southern Afghanistan. Thanks to our massive treasury, we are able to provide our troops all sorts of protection, such as the new armored vehicles known as MRAP’s and ubiquitous IED-jammers, that poorer nations can’t afford. We also provide the best in air support, medical evacuation and treatment, intelligence and surveillance assets, and untold numbers of other “combat enablers” to allow our troops to get the most dangerous jobs done as safely as possible. Casualties are still higher than anyone would like, but they are pretty low when compared to past wars, especially past counterinsurgencies, precisely because of such spending.
There are also numerous comforts available to our troops at their Forward Operating Bases in Afghanistan and Iraq that would have been unimaginable to previous generations of servicemen—everything from fully equipped PX’s to dining facilities serving multiple types of freshly made pies. And then there is the compensation awarded to our service personnel. They have to be paid a competitive wage, along with decent medical and retirement benefits, because they are all volunteers, not the conscriptees that have fought so many of our previous wars. Those personnel costs are rising because of the much-needed increase in the size of the ground forces.
If you add in the rising cost of military equipment—everything from Nimitz-class aircraft carriers to F-22’s—the wonder is that defense spending is so low, not so high. In fact defense spending needs to go even higher to make up for years of procurement shortfalls and the urgent need to expand our ground forces even further. But we’re rich enough to afford it. What we can’t afford is to stint on our armed forces at a time of war.
