$12 Billion a month, Pocket Change

[Strongbow]

Originally posted by Irvine511
Christopher Hellman knows that if someone in a family suddenly has a brain tumor, their spending priorities change.

this is preposterous. keep repeating the same lines, it won't make them any more true.

Whats preposterous is you are unwilling to accept a basic fact which is obvious to most people including Christopher Hellman. In order to understand the burden any level of spending has on any particular entity, it must be compared to that entities total wealth.

[Strongbow]

you see the fallacy of trying to make these broad, self-serving historical comparisons. if anything, increasing the US budget probably inspires the same behavior in China, Russia, and India, which then inspires likewise behavior in, say, Taiwan and Pakistan.

given what the rest of the world is spending, that 5% of GDP is actually far too high.

What the rest of the world spends is not necessarily relevant to what the United States needs to spend. Al Quada does not have to match US defense spending dollar for dollar in order to be able to attack the United States domestically or abroad in order to do damage that is unacceptable. Again, the key in such a comparison is not dollar vs. dollar spent, but intentions and actual capability in various situations. The threat level is not only determined by the money spent, but by the intentions and the actual capabilities of the country.

Over half of US defense spending is simply devoted to pay and training of the troops. The larger highly developed countries of the world always have their defense budgets skewed higher because of that simple fact. But in reality, the overall budget does not determine actual military capability. If it did, Japan would have roughly an equal military capability to Russia. Even after adjusting for purchasing power parity, Russia spends 58 Billion dollars a year compared to Japan which spends 43 Billion dollars a year. But in terms of raw military capability, the two countries are not even close. Russia is way ahead of Japan.

[Irvine511]

Originally posted by Strongbow


Whats preposterous is you are unwilling to accept a basic fact which is obvious to most people including Christopher Hellman. In order to understand the burden any level of spending has on any particular entity, it must be compared to that entities total wealth.

Hellman most assuredly disagrees with your assessment of the situation -- he notes, quite specifically, how specious the rationale you're putting forward is. it's not about the burden on the country, but about the burden on the taxpayer. *that* is why someone gets up in arms about $12bn a month. total GDP has NOTHING to do what what needs actually are.

[q]In 2002, the first complete Bush administration defense budget was $386.2 billion in FY-06 dollars, or 3.4 percent of a $10.3 trillion GDP.

In 2003, the defense budget increased to $438.8 billion, 3.7 percent of the $10.9 billion economy.

In 2006, the defense budget hit $428.5 billion, according to Pentagon numbers, 3.3 percent of the $12.8 trillion economy. CSBA calculates the defense budget as somewhat higher -- $447.4 billion.

The numbers from 2003 and on, do not include the supplemental appropriations to pay for the wars in Iraq and Afghanistan, which are nearing a total of $400 billion.

That is nearly the amount of money the United States spent on defense during the height of the Cold War, when there was a peer competitor in the Soviet Union, said CSBA's director for budgetary studies Steven Kosiak. Reagan is credited with winning the Cold War and causing the disintegration, in part by forcing huge defense budgets on the weak Soviet economy as Moscow tried to keep up.

Christopher Hellman, a defense analyst with the Center for Arms Control and Non-Proliferation rejects Rumsfeld's use of the GDP as a point of reference.

"The GDP argument is the last refuge of scoundrels," Hellman told UPI Wednesday.

"Comparing (the defense budget) to GDP is a measure of the program's burden on the U.S. economy. Spending levels are a (measure of a) program's burden on the American taxpayer.

"It's a fallacious argument," he said. "Tying our level of spending to defense to the number of cheeseburgers consumed by Americans is not a good way to measure our strategic requirement."

Hellman offered the counter-argument: What if gross domestic product decreases?

"If you are going to decide what is an appropriate defense budget based GDP, what happens if the economy tanks? Are you going to cut it in half?" he said. "They only want to tie it to GDP when GDP is going up, not when it's going down."



[/q]

[Strongbow]

Originally posted by financeguy


No, he hasn't. He's got the point perfectly, and he's run rings around you in arguing it.





You've said it yourself. If the economy shrinks - and most analysts believe that we are heading into a recession - then what looks now to be quite a moderate % may turn out to look quite a large one after several quarters of negative real GDP growth.

The point, which I guess you don't understand either, is defense spendings burden to the country. In order to look at that, you have to compare defense spending total to current GDP. Irvine for some reason insist that is a useless comparsion. Irvine says that comparing any level of spending on anything relative to ones wealth is a useless comparison in determining the burden of the spending to that individual.

Yet, that is precisely what individuals, families, business's and yes countries do every year.

If the economy actually did shrink by an annual total of 2% this year, Defense spending as a precentage of GDP would rise to just under 5% of GDP, still below the peacetime level of 6% during the 1980s under Reagan.

Past recessions here in the United States have had small contractions of the economy and only for 6 months at a time. The recession in 2001 saw two single quarter growth contractions of .5% and 1.5%. The last recession before that in 1990-1991 saw two single quarter growth contractions of 2% and 3%. In both of those recessions, averaged out over the course of the year, GDP growth for the year was still up, although by a smaller amount because of the recessions.

[Irvine511]

which proves the point. determining defense spending as a % of GDP -- or using that as an excuse for a massive industry that has only grown with the Bush administration will contractors and lobbyists -- is a stupid and worthless way to go about it. GDP decreased, but military spending when up. THERE IS NO CORRELATION. so military spending continues to go up as GDP decreases. what then? higher taxes? cutting more social programs? increase the deficit even more? THIS is the burden that we should worry about. THIS is where "affordability" comes in to play.

why is the military 1/3rd smaller than it was in 1990, yet spending has not correspondingly decreased?

again, as always, your posts are pure propaganda, designed to mislead and obfuscate what the issue actually is.

[Strongbow]

Originally posted by Irvine511




Hellman most assuredly disagrees with your assessment of the situation -- he notes, quite specifically, how specious the rationale you're putting forward is. it's not about the burden on the country, but about the burden on the taxpayer. *that* is why someone gets up in arms about $12bn a month. total GDP has NOTHING to do what what needs actually are.





[/q]

He doesn't, the only distinction he tries to make is that defense spending relative to GDP measures the burden to the economy, while defense spending level is a burden on the US Tax payer.
The US Tax Payer though is essentially US GDP. 70% of US GDP comes from US consumer spending. The taxes the government pulls in every year is based on the total wealth of the country, GDP. As the country becomes more wealthy, GDP growth, the amount of tax money the government has to spend swells. When GDP grows slowly or contracts, then the amount of money the government is able to raise from taxes decreases. GDP represents the wealth of the country including the tax payer. Over the past few years, the government has been taking in about 20% of US GDP in taxes. Less than 20% of it goes to spending on defense and the wars in Afghanistan and Iraq, compared to the 1980s when 28% of it went to defense even though there a war was not being fought.

But even if we accept his distinction, then were looking simply at the government budget, where the government spends the tax money it receives every year.

Again, when it comes to the annual Federal Budget, current US defense spending has fluctuated between 17% and 19% of the total Budget. During World War II it was 90% of the Budget. During the Vietnam War it was 50% of the budget. During the 1980s under Reagan it was 28% of the budget. During the 1990s under Clinton, the lowest defense spending year was still 16% of the federal budget.

[Strongbow]

Originally posted by Irvine511
which proves the point. determining defense spending as a % of GDP -- or using that as an excuse for a massive industry that has only grown with the Bush administration will contractors and lobbyists -- is a stupid and worthless way to go about it. GDP decreased, but military spending when up. THERE IS NO CORRELATION. so military spending continues to go up as GDP decreases. what then? higher taxes? cutting more social programs? increase the deficit even more? THIS is the burden that we should worry about. THIS is where "affordability" comes in to play.

Its not an excuse for any level of spending! Its only used to show how much of a burden the level of spending is to the country and whether the country can sustain that level of spending. Again, level of spending on any program compared to GDP or the country's wealth is the only way to determine the actual burden to the country.

Real US GDP has only decreased marginally for a 6 month period in 1990-1991 and a 6 month period in 2001. Annual real GDP for both years though still increased. You would have to go back to the early 1980s or 1970s to find a year where total annual real GDP may have decreased.

But whenever it does decrease, defense spendings burden on the country grows even if it is only a very marginal increase as we saw in 1990 and 2001. GDP up to the latest quarter with information has continued to increase. Even if the United States does experience a recession in 2008, its likely that annual GDP for the year will still be an increase over what it was in 2007.

How you pay for a certain level of defense spending, increasing levels of defense spending, or whether you can in fact decrease defense spending are seperate issues from the actual burden any level of defense spending is placing on the country.

why is the military 1/3rd smaller than it was in 1990, yet spending has not correspondingly decreased?

The military is fighting two major wars. The US military pays its troops more than it did in the 1990s adjusting for inflation. There have been huge improvements in training which saves lives on the battlefield but also cost more money. The military is buying more weapon systems with more modern features that improve combat capabilitiy and survivability on the battlefield. The military is going to have to start to replace weapon systems that it has used since the early 1980s. Weapons platforms such as planes and tanks get old and have to be replaced. The Airforce has to start replacing F-15 and F-16's before these airframes become to old for airmen to safely fly in them. There have already been some accidents blamed on the age of the aircraft. The aircraft that will replace them are more expensive but provide capabilities and surviviability features that the previous aircraft did not have. The MRAP's that are being purchased to replace US Humvees in Iraq are much more expensive than actual Humvees, but they can withstand a 250 pound IED unlike a US Humvee or most vehicles used by the Army and Marines.