Tying US Defense Spending to GDP: Bad Logic, Bad Policy   [open pdf - 242KB]

"As the war in Iraq drags into its sixth year and cumulative spending approved by the Congress for the 'global war on terrorism' surpasses $850 billion, both the American public and security experts are becoming increasingly concerned about the present and future direction of US defense spending. One proposal under consideration is to allocate the defense budget each year as a specific percentage of America's gross domestic product (GDP).Advocates of this approach typically recommend pegging 'base' Department of Defense (DOD) spending, which excludes both supplemental appropriations for ongoing military operations in Iraq and Afghanistan and Department of Energy-administered nuclear weapons activities, at four percent of GDP. In an April 2008 speech on Iraq, President George W. Bush compared current defense spending to higher levels sustained during the Truman, Eisenhower, and Reagan administrations. He concluded that four percent of GDP 'is a large amount of money, but it is a modest fraction of our nation's wealth.' Republican presidential nominee Senator John McCain (R-Ariz.), top Pentagon officials, conservative security analysts, and several members of Congress have endorsed the four percent proposal. Media reports indicate that the proposal is under consideration by high-level Pentagon officials and 'may look very different by the time it reaches the White House or Capitol Hill."

Report Number:
Autumn 2008, Vol. XXXVIII, No.3
2008 Travis Sharp
Retrieved From:
Via E-mail
Media Type:
US Army War College Quarterly
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