Let's stick to rates, people.
The other day I made the point that our propensity to talk about spending in terms of absolute levels but taxes in terms of rates biases the whole debate towards doing things through spending cuts. I personally think talking in terms of rates or percentages makes the most sense. In a growing economy, with inflation, I don't really care that this is the "biggest budget in American history" or the "biggest deficit in American history". Do you notice how you hear those phrases every year? It's because the economy is growing.
This applies to defense spending as well. For some reason it is particularly hard to get this reported in per capita or as a percent of GDP terms. When you do a cross-country comparison we dwarf everyone else, but when you look at defense spending per capita or as a percent of GDP things start to get a little more reasonable. Throw in the fact that if we reduced our security spending, all of our allies would increase it and it looks even more reasonable. You may not like that we are the de facto guardian of the free world (I am fine with some aspects of that arrangement and less fine with others), but lets not pretend that spending levels are associated with some underlying American violent psycopathy. There are very good reasons for the levels we spend.
1. We are the leader of the free world when it comes to security issues.
2. We have more people and wealthier people. The value of national security is higher and we can afford it. It's the same reason rich people have body guards and I don't.
3. Our military is a force for scientific and technological boundary-pushing. We buy more expensive stuff.
4. Evenly matching the capabilities of your potential enemy is really dumb national security strategy.
Much of this would be clear if we made sure our fiscal talk stuck to rates and percentages rather than absolute numbers.
The argument is not that there aren't cuts to be made to the military. Everyone knows this. Repeating this point that I already know doesn't mean you've somehow bested me. In fact the Pentagon itself is often in the lead of telling Congress that a lot of the weapons systems they appropriate funds for are just a waste of money.
If you want to reduce the defense budget you get us out of Afghanistan and downsize our presence in Germany and South Korea (even if we want to continue providing a security umbrella, why do we need such a big foot print there? It's not like the Red Army is going to be coming over the horizon or anything). Cut specific weapons systems we don't need.
Don't cut defense indiscriminately in the middle of a recession and make exclamations about perfectly sensible discrepancies between countries in raw defense spending and then call me the hysterical one.
Wednesday, December 12, 2012
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"2. We have more people and wealthier people. The value of national security is higher and we can afford it. It's the same reason rich people have body guards and I don't."
ReplyDeleteAs usual, I fail to understand why your methodology is sufficient to determine an optimal level of funding for a public good but not a private good.
"that the State should leave exports to the exporters, to industry, and to the merchants, and should not identify itself with the interests of the exporting class... If industry... values the protection afforded by warships, let them go and shell out a part of the surplus profit they have captured in this way and build the cruisers for themselves." - Eckart Kehr (speaking of Eugen Richter), Eugen Richter and the End of German Liberalism
You don't seem to see any value in deciding for each and every rich person exactly how much money they should shell out for body guards...yet you see value in preventing each and every one of them from deciding how much of their taxes they should shell out for cruisers.
If your methodology is effective for determining the optimal amount of cruisers...then why don't you advocate that we use it to determine the optimal amount of body guards?
If you get a chance you should read these passages that I've compiled on rational ignorance and decentralized knowledge.
"This applies to defense spending as well. For some reason it is particularly hard to get this reported in per capita or as a percent of GDP terms. When you do a cross-country comparison we dwarf everyone else, but when you look at defense spending per capita or as a percent of GDP things start to get a little more reasonable."
ReplyDeleteThat depends entirely upon what you want to look at. If you want to look at the cost of defense, that is fine. It makes a lot of sense to look at it as a % of GDP or on a per-capita basis. (Though why you would then make cross-country comparisons with that is beyond me.) But if we want to look at the benefits of defense spending, looking at the absolute level of spending makes a lot of sense. If you go to war, you don't go to war on a GDP-adjusted or per-capita basis. Luxembourg could spend 100% of its GDP on military expenditure and it would still be hopelessly out-matched by the US militarily. So it makes a lot of sense to make cross-country comparisons of absolute spending levels in order to get a rough estimate of: "Who can we take on and win?" When we've looked at that, it's relatively obvious that even at lower spending levels, the US could still handily defeat any likely coalition.
"2. We have more people and wealthier people. The value of national security is higher and we can afford it. It's the same reason rich people have body guards and I don't."
I would like to see evidence that rich people spend an increasingly large percentage of their income on bodyguards as they become richer. Security spending is a competition. You don't need to spend more than you need to win the competition. Currently the US spends more than the next 9 countries put together, many of which are allies. What benefit is there to that with respect to the security of the United States?
"3. Our military is a force for scientific and technological boundary-pushing. We buy more expensive stuff."
First, I am not sure how much military expenditure actually goes to R&D. Also, I am doubtful that much of it reaches consumers in a more reasonable amount of time than if this was money handed over to the NIS, NIH, etc... Military-developed technology tends to come with strings attached like secrecy...
"4. Evenly matching the capabilities of your potential enemy is really dumb national security strategy."
I don't think I've heard people argue this before, so I'm not sure what you're responding to.
Your arguments fall very short of the task you set. All your arguments can show is that the US should spend more on its military on average than the rest of the world. They show perhaps that the US should remain the biggest spender by a wide margin. But it does not follow that the US should remain the biggest spender by such an insane margin.
"If you want to reduce the defense budget you get us out of Afghanistan and downsize our presence in Germany and South Korea (even if we want to continue providing a security umbrella, why do we need such a big foot print there? It's not like the Red Army is going to be coming over the horizon or anything). Cut specific weapons systems we don't need."
Again, what do you fear? Sure, in an ideal world, there are some programs that would take more cuts than others. But ultimately, I have a hard time imagining that a 10% cut across the board will significantly affect the security of the United States. And at least this way it can happen as opposed to being a pipe dream. I'm sure Congress will eventually figure out how to let the military re-direct its spending to reflect priorities.
"Don't cut defense indiscriminately in the middle of a recession and make exclamations about perfectly sensible discrepancies between countries in raw defense spending and then call me the hysterical one."
DeleteThe existence of a discrepancy is sensible. The magnitude of it is definitely not. As Don Boudreau was pointing out, 5 years of sequester (an unlikely event) would cause the US to fall to outspending only the next 9 biggest spenders. Yes, there would be some extra spending by some of them, (including allies, friends and trade partners) but it is highly unlikely that the US would still greatly outspend China and Russia put together. That's the point we're making: The US is standing on a chair even though it would remain king of the hill without the chair. So get off the chair and give us back our money. It might not be a lot of money on a % of GDP basis or a per-capita basis, but it's still money the US military clearly does not need.
Or if you're worried about the cyclical effect, let's hand that money to the NIH, NIS, or do helicopter drops. Basically, do stuff that is useful from more than just a stimulus POV. Military spending isn't going to spend just because of a recovery.
Delete1. Nope. We're a "rogue state" in world terms. I think Canada contributes the most to UN Peacekeeping?
ReplyDelete2. Nope. Not the largest population and not the wealthiest median population, far from it. We do have some of the richest 0.1%-ers, but they can take care of themselves as far as I am concerned, as long as it isn't all of us who are at risk.
3. Expensive junk. The last useful military spinoff tech was GPS, I think, or maybe the Internet. That's *decades* ago.
4. We haven't matched the capabilities of guerrilla warriors in caves in Afghanistan. The spending is simply wasteful, because it's not *working*, we can't win wars with it.
I could go further; I agree with PrometheeFeu, too. I really do think our military spending in the US is almost completely wasteful. More Coast Guard funding would be good, I guess.
You need to keep better track of your superlatives. I didn't say we were the most populous or the wealthiest.
DeleteI'm surprised you all think I'm just talking about spin-offs. I'm just saying that - like our medical industry - our military is more at the cutting edge than others are, which is not a bad thing and which is going to make things more expensive.
On your response to 4, I agree. Let's cut what's wasteful! God knows they've been told in enough hearings what that is. It should not be hard.