Defense Spending: Overview.

The United States spends significantly more money than any other country in the world on its national defense, in large part for military training, payroll, health care, equipment, and arms. The funds allocated for defense spending are proposed by the president of the United States, negotiated and voted on each year by Congress, and, as with other spending provisions, signed into law by the president. Consequently, the defense budget is inherently political in nature, and because of the United States' status as a global superpower, the stakes in the debate are seen as particularly high.

Many believe that the government must take all necessary steps to protect its citizens from threats at home and abroad and that increased military spending is therefore necessary to strengthen the United States' security. On the other hand, some believe the current military budget is bloated and inefficient. They argue that, if there were even a small decrease in the defense budget, those funds could be used for other important endeavors, such as repairing highways and bridges and improving schools. Because it is difficult to predict the future of foreign and domestic affairs, it is hard to gauge future military spending levels.

Understanding the Discussion

Defense budget: The portion of the federal budget allocated to the US Department of Defense, used to pay the salaries of service members of all branches of the military, including the Army, Air Force, Navy, Marine Corps, and Coast Guard. The defense budget also funds military operations and is used to purchase equipment and arms.

Discretionary spending: Government expenditures that are not required by law. Through legislation, Congress can appropriate certain funds for these purposes.

Gross domestic product (GDP): The total dollar value of the goods and services produced within the borders of a country, normally measured over a one-year period.

Inflation adjustment: A mathematical process that allows dollar amounts from different time periods to be compared on equal terms, by compensating for changes in dollar value over time.

History

The United States first began officially allocating money to a defense budget to fund military operations in 1792 and has done so every year since. Defense spending, of course, has always increased dramatically during times of war. Perhaps most notably, during World War II, 85 percent of the US budget went to defense, representing 40 percent of the country's gross domestic product (GDP). In 1960, a time of heightened Cold War tensions, defense spending was 52 percent of the federal budget, though that figure represented only 9 percent of GDP. Since the early twentieth century, the general pattern of US military spending has been steady increases in dollar amounts--accompanied, however, by even steeper increases in GDP. Thus, though approximately 20 percent of today's federal budget may be allocated to defense spending, that represents only about 5 percent of current GDP.

In terms of inflation-adjusted dollars, World War II is the only conflict that was more expensive for the United States than the Afghanistan and Iraq wars of the twenty-first century. In 2019 dollars, the US spent $4.7 trillion on World War II, while the Iraq War cost $1 trillion and the Afghanistan War cost $910.5 billion. By contrast, the Vietnam War cost $843.6 billion in 2019 dollars, and the Korean War cost $389.8 billion.

There are vociferous opinions both for and against the United States' high levels of defense spending. For many, it is a simple matter of safety and security. Especially since the terrorist attacks of September 11, 2001, many have advocated for increased spending for military and other counterterrorism efforts. US military involvement in the Middle East consequently increased dramatically over the first decade of the twenty-first century. For defense spending advocates, achievements such as the killing of terrorist leader Osama bin Laden by US special forces in Pakistan in May 2011, and more broadly the fact that there have been no further large-scale terrorist attacks inside the United States since 2001, justify the high rate of military expenditure. Furthermore, many believe that the United States' status as the sole remaining superpower in the post–Cold War world carries with it a responsibility to take a lead role in ensuring global security and stability. Should US military spending decrease, defense "hawks" fear it would directly affect the country's ability to engage militarily on multiple fronts and to keep its forces armed with the best technology and equipment. Finally, proponents of robust military spending note that defense spending in recent years has increased at a slower rate than many areas of domestic spending and that defense spending accounts for a significantly smaller portion of GDP than it has previously.

Conversely, many believe that recent levels of defense spending are both unnecessary and unwise. As with any local, state, or federal expenditure that is tied to taxpayer dollars, some believe defense spending should be subject to strict scrutiny—that any expenditure must be tailored to achieve a specific government objective. They believe other important national priorities, such as education or highway and bridge repair, deserve equal consideration when it comes to allocating taxpayer dollars. In 2010, congressmen Barney Frank, a Democrat, and Ron Paul, a Republican, launched a bipartisan effort to begin an earnest discussion about defense spending. They noted that US military spending made up approximately 44 percent of military spending worldwide. Frank and Paul shared with many a belief that the United States has for too long assumed the role of protector and defender of any country aligned with our interests; they pointed to the extraordinary expense of extending the US defense umbrella across the globe, especially over situations in which the US national interest is remote at best. With respect to specific measures to reduce defense spending, they suggested eliminating the use of certain weapons in existence since the Cold War and scaling back operations in Iraq and Afghanistan.

Defense Spending Today

In terms of military spending by dollars, the United States spent far more on its 2018 defense budget—$649 billion—than any other country in the world. The next closest country was China, at $250 billion. That means, with respect to its next closest competitor—a much larger country by population—the United States spent about two and a half times as much on defense. Despite being first in defense spending in terms of dollars, the United States was, as of 2018, ranked third in defense spending as a proportion of GDP. In other words, though the United States spends more on defense than any other country, because it is also wealthy and productive, the percentage of its GDP expended on defense is smaller than that of some other countries; in 2018, for example, Saudi Arabia and Russia (Tian et al., 2019).

The 2018 defense budget represented almost half of the United States' total discretionary budget, that part of the budget not mandated by law. Total budget outlays in 2018 were $4.1 trillion; the only budget item larger than defense was Social Security, at $982 billion. The defense budget for 2018 accounted for 3.1 percent of GDP. Because the United States' GDP rises almost every year, the dollar amount of military spending can also increase each year without increasing as a percentage of GDP. However, between 2010 and 2015, defense spending gradually decreased due to federal budget cuts and the winding down of engagements in Iraq and Afghanistan. This led to concern from many defense contractors, whose revenues dropped accordingly. The Budget Control Act (BCA) of 2011 also mandated increasing cuts to the defense budget over the following decade—though this reduction still left the United States hundreds of billions of dollars ahead of every other nation on defense spending. In December 2017, President Donald Trump signed a defense policy bill allocating $700 billion in military spending, exceeding both the binding BCA cap and the president's own proposed budget for the year.

A 2018 Gallup poll found that opinions on defense spending were about evenly split: 33 percent of respondents thought defense spending was too low; 34 percent, too high; and 31 percent, on target. The following year, Gallup found that 25 percent of respondents thought defense spending was too low; 29 percent thought it was too high; and a much larger 43 percent thought the US spends the right amount on defense. Proponents of higher defense spending, such as Rachel Zissimos and Lt. Gen. Thomas Spoehr of the Heritage Foundation, argue the US military must spend more on procurement to replace aging equipment, the threats to national security have become more complex, and more could be spent on defense relative to GDP. Critics like Lawrence Korb, assistant defense secretary under Ronald Reagan, say the military is more than adequately prepared for crises, US defense spending far outstrips any other country's, and national security also benefits from diplomacy, humanitarian aid, and membership in alliances like NATO, which require budgeting as well.

The future of defense spending is difficult to forecast. Defense budget requests largely depend on world affairs. If, on the one hand, the US continues reducing its military footprint in the Middle East, defense spending could start to decline. Conversely, if the United States finds itself unable to withdraw from this region, or if other regions of the world destabilize and US leaders feel compelled to intervene, future budgets undoubtedly will reflect the necessity of overseas military operations.

Furthermore, US military budgets are always the product of protracted negotiations that in part reflect the ever-changing balance of political power in the United States. Often, what the Department of Defense feels it needs, what the president proposes, and what Congress authorizes are three different figures, and the final figure always represents some level of compromise. The political ideology behind the defense budget changes to some extent with presidential administrations and with changes in party majorities in Congress.

Finally, any budget is also dependent on the economy. When the economy is strong and taxpayers feel prosperous, increases in taxation and spending for the military or anything else are met with less resistance than during economic downturns. Whatever the factors at play, however, the United States seems likely to continue to lead the world in military spending for the foreseeable future.

• These essays and any opinions, information, or representations contained therein are the creation of the particular author and do not necessarily reflect the opinion of EBSCO Information Services.

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