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U.S. Defense Merits Spending

Big surprise. Reason magazine, the libertarian Bible, favors cutting defense spending. But it would be hard to come up with a more unpersuasive argument if they tried. Contributor Veronica de Rugy of George Mason University, a bastion of free-market economics, writes:

Liberals often view the Pentagon as an item that should be cut but can’t for political reasons. … Yet such cuts have been achieved in the past. … During the last 70 years, the defense budget was cut 26 times by an average rate of 10 percent. … The biggest cuts followed World War II, with a 72 percent reduction in 1947. The last cut was in 1998. … Most of the cuts have taken place after the end of a war. But cuts were also achieved in the late 1960s and early ’70s, despite the ongoing conflict in Vietnam. Politicians explicitly debated how to cut spending without cutting security, and they still managed to get re-elected.

So let me see if I have this straight: de Rugy thinks that defense cuts in the late 1940s, early 1970s, and early 1990s are a good model to follow? In all three instances, major wars were winding down (World War II, Vietnam, and the Cold War, respectively), and the political class was eager to spend a “peace dividend.” Ms. de Rugy is an economist, not a historian, but she would be well advised to study the historical record for what happened next.

In all three cases, the result was to make America less secure and to embolden our adversaries. The precipitous decline in defense spending after World War II left us ill-prepared to confront Communist aggression in Korea. The drawdown after the end of the Vietnam War led to a “hollow army” that could not stand up to Soviet aggression or the Iranian hostage crisis in the 1970s. And the 1990s drawdown, which included slashing a third of the Army’s active-duty strength, left the armed forces overstretched and ill-prepared to deal with a host of low-intensity conflicts, from Somalia to Iraq and Afghanistan.

Since 9/11, the trend has reversed, with a big increase in defense budgets, but most of the money has gone for current operations and personnel costs (including health care and pensions) – the latter line item consuming an ever-larger share of the budget since the abolition of the draft in 1973. The U.S. armed forces have not been able to acquire enough big-ticket items to replace weapons designed and bought during the Reagan years or even earlier. (B-52 bombers and KC-135 tankers date back to the Eisenhower administration.) The Army has grown slightly, but it is still far below its strength at the end of the Cold War, when it had 710,000 active-duty soldiers. (Today the figure is 560,000.)

It’s true that we spend as much on defense as the rest of the world combined, but our commitments are also greater because the U.S. armed forces have to maintain peace and security across the globe – something that is increasingly hard to do when the Navy, for example, has just 286 ships (down from almost 600 ships in the Reagan years). We can certainly afford to keep spending as much on defense as we do today – or even spend more. As de Rugy notes in passing, defense spending is hardly a crippling burden, insofar as it accounts for less than 20 percent of the federal budget and 4.6 percent of GDP (down from 6.2 percent in the 1980s).

She seems enamored of studies that claim that great efficiencies can be achieved “by eliminating a few controversial weapons systems or by reforming the Pentagon’s supply chain, I.T., and personnel management practices.” There is little doubt that the Pentagon – one of the world’s largest bureaucracies – can be more efficiently run. But, to refer once again to the historical record, every secretary of defense since the post was created in 1947 has tried to cut “waste, fraud, and abuse.” This may have saved a few bucks at the margins, but at the end of the day, no green-eye-shade legerdemain can produce a budgetary miracle of less spending and more defense capabilities.

The bottom line is: either we keep spending a lot for defense, or we will watch our strategic position decline. And the consequences of such a decline – as we learned in the 1950s, 1970s, and 1990s – will be far more costly in the end than maintaining a robust deterrent capacity to begin with.



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