‘Back to the Future’ Foreign Policy

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Defense spending as a share of GDP measures militarization of our society, but that does not necessarily mean strength. By Ben Freeman and Mieke Eoyang

The 1980s are all the rage once again—from neon clothes to Robocop and the Teenage Mutant Ninja Turtles. Even America’s 1980s foreign policy is back in fashion amongst Neo-Cold Warriors longing to return to the Reagan era.

President Barack Obama quipped to Mitt Romney during the 2012 election that, “The 1980s called—they want their foreign policy back,” and he’s giving the military more money, even adjusted for inflation, than President Ronald Reagan ever did. But, the Neo-Cold Warriors still can’t abandon their Reagan nostalgia, especially after Russia’s invasion of Crimea, which has led some to ask “Was Mitt Romney right about Russia?”

Obama’s military outspends Russian President Vladimir Putin’s by more than seven to one. Yet, Rep. Paul Ryan, R-Wisc.,) rails against the president because, “For decades, defense spending made up roughly 50 percent of the federal budget. Today, it’s just 18 percent.” While ignoring the fact that defense spending hasn’t made up more than 50 percent of the federal budget since we put a man on the moon, Ryan is also concerned about the decline in defense spending as a percentage of GDP. Sen. Lindsey Graham, R-S.C., similarly bemoans the fact that America’s defense spending falls short of the 6% percent of GDP it was under Reagan, and The Wall Street Journal claims that by this metric Obama will leave his successor a “weaker” country than he inherited.

Whether or not you think the current level of spending is sufficient, defense spending as a share of GDP measures militarization of our society, but that does not necessarily mean strength.  Applying Reagan’s magic percentage today ignores changes in our economy, the threat environment and our capabilities.

First, our economy has changed dramatically since 1986. Back when Marty McFly was going back to the future in a Delorean, the U.S. economy was worth nearly $8 trillion, adjusting for inflation.  Since then, we’ve seen the rise of the internet and the emergence of new industries. As a result, the economy has doubled in size, and is now worth nearly $16 trillion. So, if we were still spending the same percentage of GDP on defense as in Reagan’s heyday, Pentagon spending would be nearly a trillion dollars.

You read that right. A trillion dollars.

No defense hawk, not even Lindsay Graham, suggests the military needs a trillion dollars to defend the country. In fact, Paul Ryan, recently announced that House Republicans are proposing a $528.9 billion military budget, roughly 3.3% of GDP–still far short of Reagan’s 6%. Thus, despite Ryan’s claim, he’s not presenting “A Clear Choice on Defense.”

The second problem with tying defense spending to GDP is that it sets a benchmark that is unrelated to the threats America faces. Economies ebb and flow, often unrelated to national security challenges. Thus, anchoring military spending as a percentage of GDP would force you to spend more on your military in boom times, or cut your military during recessions—regardless of whether there’s a security threat. Doing so would have led President George W. Bush to the ridiculous outcome of cutting military spending during the economic downturn following the attacks on 9/11.

Unfortunately, economic changes and threats aren’t the end of ignorance when military spending is tied to GDP. The third nail in this flawed metrics’ coffin is that it fails to account for the capabilities of our military.

While neon clothes remain just as hideous looking as they were in the 80’s, our military capabilities today are vastly superior to the Reagan era. In Reagan’s military, we had to risk flesh-and-blood pilots over hostile territory to strike our foes. Now a drone pilot in Nevada can kill a terrorist in Afghanistan. Conducting a cyber-attack to decimate an enemy’s command structure, as the Pentagon and National Security Agency had planned to do in Syria in 2011, would have seemed like science fiction to Reagan’s military. The technological advantages we’ve seen since the Cold War ended are phenomenal and shouldn’t be ignored in calculating military might.

Ultimately, military budgets should be determined by the threats we face, our capabilities, and our national security strategy. A thriving economy is the foundation upon which a nation can provide for its defense, but it should not naively be used to set a military’s budget.

The U.S. will win the next war by having better soldiers, strategies, and capabilities than our adversaries, not because of what we spend on the military relative to the economy, entitlements, total government spending, or any other misguided metric.

Ben Freeman is a Policy Advisor at Third Way’s National Security Program and Mieke Eoyang is the program’s director. She previously served on the House Armed Services Committee.

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