Don’t Balance the Budget on the Backs of Our Troops

David Frum acknowledges that I have an idea — a defense stimulus — to help jumpstart the weak U.S. economy; however, he says, he doesn’t exactly agree with me. “Given the extremity of the country’s fiscal challenges,” he writes, “I see no responsible way to sustain a defense budget over four percent of the [Gross Domestic Product] GDP.”

Given that Republican lawmakers seem unwilling to even entertain my idea, I suppose I should be grateful to Frum for even acknowledging my proposal — and I am. Still, Frum contributes to the confused nature of the debate by propagating misleading data and information.

While America would do well to increase defense spending to five percent or more of the GDP — this to better correspond with historic wartime spending levels — there is little to no chance that this will happen. In fact, as defense analyst Thomas Donnelly observed in recent congressional testimony, President “Obama’s plan to ‘freeze’ the defense top-line [budget number] will see that level fall again to three percent [of the GDP] at the mid-point of a projected second term in office.”

Thus, keeping defense spending at even four percent of the GDP would be a tremendous achievement. Unfortunately, congressional Republicans — led by Senators McCain and Graham — are doing little or nothing to champion this crucial and necessary cause.

(By way of historical comparison, during World War II the United States spent more than a third of its GDP on defense. The corresponding figure during the Korean War was 14% of the GDP; and, for the Vietnam War, it was 9.5% of the GDP. At the height of the Cold War, under President Kennedy, nearly 10% of the GDP was spent on defense.)

Mitt Romney, however, has shown leadership on this issue: by calling for a significant increase in the military modernization budget.

“When I add up the demands of all these defense missions,” Romney told the Heritage Foundation last June, “I do not come up with budget cuts. As a simple matter of budget mathematics, we cannot fulfill our military missions without an increase of $50 billion per year in the modernization budget.”

It’s not that four percent is a magic number; it’s not. But as Romney explained, “I can see no reasonable scenario by which America can spend less and still provide our servicemen and women with the modern equipment and resources that they need to defend us.”

Moreover, in the absence of some minimum mandatory level of defense spending, there is a serious risk — and perhaps the likelihood — that defense spending will be crowded out by other competing budgetary demands. And in fact, as Donnelly pointed out, this is now happening. Stimulus 1.0, for instance — all $787 billion of it — is conspicuous for its lack of military spending.

Yet, providing for the common defense is the federal government’s number one responsibility — a responsibility expressly prescribed by the Constitution of the United States. The “right to healthcare,” by contrast, is nowhere mentioned in the Constitution.

Unfortunately, not only is the defense budget being cut as a percentage of the GDP; but crucial weapon systems are being cut outright or eliminated entirely, and modernization is being squeezed. The Obama administration has eliminated, for instance, the Transformational Satellite program and eight new Army combat vehicle types. Heritage Foundation defense analyst Mackenzie Eaglen explains well why this is happening:

If modernization spending simply held steady through 2011, that would still lead to a $22 billion (inflation-adjusted) reduction in such funding — a 10 percent cut. However, the Obama administration isn’t trying to spread its defense cuts over a five-year budget plan. Modernization spending will tumble by $30 billion in 2011 compared with fiscal 2010.

Additional defense dollars thus aren’t going to needed weapon systems for our troops; they’re going instead to increase pay and benefits, especially healthcare. And for this we can thank George W. Bush and the Republicans in Congress: because the GOP seems no less willing than the Democrats to make military members and their families loyal wards of the state. Indeed, as Donnelly told Congress:

At the end of the Cold War — when the force was much larger — healthcare accounted for about four percent of defense spending. During the Bush years, that doubled and current trends would take it to 12% by 2015.

Most of this increase is due to a single benefit, ‘TRICARE for Life,’ enacted in 2001. This extended the benefits of the military health insurance program to members, their families and survivors of their lifetimes. (Formerly, they [beneficiaries] were transferred to Medicare coverage upon reaching age sixty-five.) Thus, the GAO [Government Accountability Office] has found that TRICARE costs have been growing at an annual rate of 16%, doubling the cost to the defense budget from $17.4 billion in FY2000 to $35.4 billion in FY2005.

Of course, military members and their families require and deserve healthcare. But there are more cost-effective ways to provide healthcare than through the federal government’s quasi-socialized TRICARE bureaucracy.

A voucher-based system geared toward private-sector medicine and health savings accounts, for instance, would save the government money and effect better healthcare for our troops. However, enactment of this reform would require intellectual and political leadership by the Republican Party, which is instead brain dead and timid.

Consequently, Donnelly told Congress, “benefits consume an increasing slice of the Pentagon’s baseline budget.” In 1985, for example, the Pentagon spent $1.42 in weapons procurement for every dollar it spent on personnel; but by 1998, that figure had been reversed: “For every procurement dollar, the Pentagon spent $1.55 on personnel,” Donnelly said.

Meanwhile, the Army, Navy, Air Force, and Marine Corps rely on antiquated equipment, much of which is older than the soldiers, sailors, airmen, and marines who operate that equipment. The Army, for instance, hasn’t taken delivery of a new combat vehicle type since the early 1980s. Most Americans, by contrast, drive vehicles that were designed and built in the 21st Century.

Similarly, with his cell phone, digital camera, iPod, and global positioning system (GPS), the typical civilian teenager has more technology at his disposal than a young soldier or Marine. The Army is trying mightily to remedy this problem by “networking” the force; but funding constraints make this a difficult and unnecessarily time-consuming process.

Why not, then, champion a defense stimulus that plays to the central strength of the American economy in the 21st Century? Why not champion a defense stimulus that will harness computer processing power and other information technologies to create new and unprecedented opportunities for our soldiers? Why not champion a defense stimulus that will accelerate the networking of U.S. forces, and accelerate as well the development of new combat vehicles that can accommodate that network?

Surely, this is the right thing to do for our soldiers; the right thing to do for our economy; and the right thing to do politically.

But Frum’s most significant error is his assertion that the United States may have to withdraw from Iraq and Afghanistan prematurely, by January 2011, to get its economic house in order. But facts are stubborn things, and the facts simply don’t support the notion that the wars in Iraq and Afghanistan are exorbitant drains on the federal budget.

In fact, quite the contrary: “War-time costs have averaged just about one percent of the GDP,” Donnelly told Congress. And even with the surge in Iraq and a potential surge in Afghanistan, war costs would only “rise to a level of about 1.2% of GDP,” he added.

But even if wartime costs rose to 10 times that amount, these are still costs the United States must bear: because that is what victory demands. And in war, as General Douglas MacArthur explained, there is no substitute for victory. Sacrifice if you must any number of domestic-social welfare programs, but don’t sacrifice the nation’s defenses. And certainly don’t risk losing a war because you are concerned about its impact on the federal budget.

It is disappointing and disconcerting to hear Frum call for what is in effect a premeditated defeat in Iraq and Afghanistan — all because he has found his inner bean counter. The wars in Iraq and Afghanistan are eminently winnable — provided our political leaders remain steadfast and committed to victory. And victory mustn’t be sacrificed on the altar of the federal budget; and neither should military modernization for our troops. America needs a defense stimulus now.