Part X

Another idea that is popular Liberals to balance the budget is to reduce military funding. This is a controversial topic and a difficult one to address because the core of the argument is how big does our military need to be? The answer will vary depending on what you think the purpose of the military should be. Should it be just to protect our borders from aggression? Or should it be able to protect our allies as well? Do we want a military that is capable of applying diplomatic pressure or even be able to intervene in other nations? Do we want a military that can overthrow other governments? I am not going to argue what our military should or should not be able to do. But we need to think about what we can afford. Think about it like this; what is the point of having a state-of-the-art security system for your home if you cannot afford the system and your house payment at the same time? If we are serious about balancing the budget we have to go where the money is and the military is one of the governments most expensive programs. So any discussion about balancing the budget will have to look at military spending.

It is important to note that the government spends a huge amount on the military ($691 billion or 19.9 % of the entire budget). That is a lot, but it is not as much as some people think. Cutting military spending or even eliminating it would not balance the budget (we would still be $602 billion in the hole even if we did not spend any money on defense. It is worth noting that three out of four times the federal government has reduced overall government spending in the 20th century has been by cutting military spending after a war (The budget shrunk after World War I, one year during the Great Depression, after World War II, and after the Korean War).

So what do we cut from military spending? If you look at the Departments of Defense’s budget there are no big surprises, the top five expenses are:

1. Operation and maintenance: $275 billion
2. Military personnel $151 billion
3. Procurement (buying stuff) $133 billion
4. Research, development, test and evaluation $76 billion
5. Military construction: $21 billion

It seems that an overall reduction would be more appropriate than targeted cuts. But how much should be cut? It is worth noting that the US military is far and away the most expensive military on earth. As I stated earlier we spent $691 billion on our military in 2010 and we spent another 2 billion on other security agencies (like the CIA and the FBI), so we spent a grand total of $693 billion on defense. Compare that with the country that spent the second most on its defense, China, who spent $119 billion on its military and national security agencies. In fact in 2010 42.5% of all the money that was spent on militaries world wide was spent by the US. Why is our spending so high? You might think it is because we are at war, but oddly enough the wars in Iraq and Afghanistan do not have much to do with it. In 2000, before the wars, we spent about 16.6% of our budget on the military (It is 19.9% today). Even if we were spending at pre-war levels we would be spending $573 billion dollars or $418 billion dollars more than China, who has the second most expensive military in the world.

So why do we spend so much? There are two reasons. First, because we are an extremely wealthy nation so we can afford an expensive military. Second, we spend a higher portion of our national wealth than most nations on the military. So what portion of our wealth do we spend on the military compared to other countries?

To make this comparison accurately it is best to compare what percent of nations total wealth was spent on their military. The wealth of a nation is tracked by a measurement called a Gross Domestic Product or GDP. The GDP of a country is the amount of money that is the equivalent of all the goods and services generated in a country each year. In 2010 the GDP of the US was 14,660 billion dollars. Of all that wealth the US spent 4.7% of it on the on the military. How does that compare with the 15 most expensive militaries in the world in 2010? Let’s take a look:



So out of the top 15 militaries in the world only Saudi Arabia spent a higher percentage of its wealth on it military than us (but since we have a lot more money, we still spend more than 15 time what they do).

So with that in mind how much could we realist really cut from defense spending? Of course it all depends on how big you think the military needs to be. A good base line would be to compare how much other nations with comparable military needs as us spend a year. Here is list of nations that in one way or another are similar to us (in no particular order):

Russia: A large nation with a history of current conflicts (Georgia, Chechnya)
United Kingdom: NATO member, large navy and second highest military involvement in the conflicts in Iraq and Afghanistan
China: Large nation, aspiring super power and world’s second most powerful military

Currently we are spending $693 billion on defense. So how much would we spend if we matched these countries' GDP percentage of spending on the of military spending?

Same GDP percentage as Russia: $586 billion
Same GDP percentage as United Kingdom: $395 billion
Same GDP percentage as China: $307 billion

For kicks if I took the average GDP percentage of the world’s top 15 militaries we would spend $422 billion.

So how much should we cut? Like I wrote earlier it all depends on what you think our military should be capable of. But for the purposes of this analysis I am going to assume that it would be possible to reduce our military spending to the average GDP percentage of the world’s top 15 militaries, which is 2.88% this is still a higher percentage than all but two of the nations on that list and we would still be spending $422 billion three and half-time half which is still three and half times higher than any other military in the world.

So what is the verdict?

This would actually make a decent dent in the deficit. These cuts would be drastic, but not unreasonable, because the percentage of our wealth is still above any other western nation and our total amount spent would still be 31.1% of all military funding in the world (compared to our closest rival China, which would only be up 8.8%)

By the numbers:

Percentage this idea could reduce the federal budget deficit by: 20.9%

Total dollar amount this idea could cut the deficit by: $271 billion