Economics, Entitlements

Just a reminder: Entitlements, not defense, are bankrupting America

Old Glory in the Sunlight

Photo Credit: jnn1776 (Flickr)

Two quick charts for you from AEI scholar Nick Eberstadt’s latest book, A Nation of Takers.

First, we see that our non-Iraq/Afghanistan defense spending totals about a half trillion dollars. Entitlements are costing us nearly 3 trillion, and they’ve nearly doubled since the turn of the century.

The second chart looks at defense spending as a percentage of GDP, where we see that overall spending is down nearly 50% since 1962. If you don’t include the Afghanistan and Iraq wars (the costs of which will soon be over), the decline is even greater.

So the next time someone tells you that the national debt or deficit requires us to drastically cut the military, remember these charts. The simple fact is that our defense spending is lower than it was during the Cold War (as a share of GDP), and is less than half as expensive as our entitlements, even when factoring in two large, multi-year occupations on the other side of the globe.

Our entitlement spending, meanwhile, continues to expand exponentially.

 

20 thoughts on “Just a reminder: Entitlements, not defense, are bankrupting America

  1. Entitlements are abhorrent, but at least they help people. Defense spending just wastes resources on weapons to blow things up, equipment to deliver the weapons, and human lives of naive young men who think they are defending their nation but in reality are being used to create anger and resentment among people in other nations who become more likely to hate the US, thus requiring more defense spending. From the point of view of a defense contractor, this is a perfect profitable circle. More defense spending leads to more defense spending. From an economic point of view it is the biggest, most expensive broken window fallacy.

    What your graph fails to show is that the US spends almost as much on “defense” as all the other nations in the world combined.

    Eisenhower saw this coming. Some people seem incapable of seeing it even after it has arrived.

    The whole defense spending/terrorism circle has also given us the TSA, has created a surveillance state, and has destroyed other civil liberties as well. I guess that doesn’t matter? Or it’s an “affordable” cost?

    Tell me why George Washington was wrong about foreign entanglements. Tell me why the terrorists never target Switzerland. Tell me what is so wrong with the concept of neutrality, minding one’s own business, and using “defense” for actually defending this nation instead of attacking and alienating others.

    • On net, do entitlements really help people? I doubt it.

      There is a cost to entitlements other than just the checks cut by the government. It requires much higher taxes, which reduces economic growth. It’s important to look at the indirect effects of government policies as well as the direct effects.

      • Not all entitlements are equal. I believe Social Security helps elderly people who can no longer earn a living. And there is an argument for benefits for a single mother who is unskilled and suddenly loses her job.

        Long-term entitlements may be counter-productive. My point however was to contrast money for needy people in the US with money for wreaking havoc on foreign countries, where the potential for counter-productive consequences is much higher.

    • Want to know why America is in trouble? Read above. I guess you would like for our allies to remain neutral if we as a country were unable to defend itself? Which, by the way it will be soon if we remain on our current path.

      As for Entitlements helping people? How? By encouraging them not to get jobs? Since when was health insurance a right? The fact that 50 percent of America does not pay federal income tax is unstainable and these entitlement programs have got to stop. I am all for a hand up but not a hand out. There are plenty of jobs….just no motivation to find them when you have the Government handing it out as a way of life. Makes me sick!!!

    • What your graph fails to show is that the US spends almost as much on “defense” as all the other nations in the world combined.

      It does more than that my friend. It shows that the author is dishonest because he does not look at all of the military related spending. If he were honest the cost of VA, CIA drone program, DHS, DoE nuclear arsenal, foreign military aid, NSA, NASA military satellite program, and the interest being paid on money borrowed to pay previous wars would be included in the total cost. When everything is added you have about as much spent on military related activities as you have coming in as from income tax revenues.

      The GOP and ‘conservatives’ that promote the warfare state are just as intellectually bankrupt and dishonest as the welfare state Democrats. Which is why Congress has such a low approval and the parties are losing members as more and more people call themselves independents.

  2. more synthesized data. try to follow the commerce link to see if it supports the data in the graph.

    The graph claims that defense spending is less than half a trillion dollars.

    where is the reference for that? How about this one:
    http://www.whitehouse.gov/omb/budget/Historicals/

    683.7 billion or this one:

    http://www.gao.gov/products/GAO-12-132

    or this; National Defense spending = 1 to 1.4 trillion.

    over and over, we see what is dishonest representations of the truth… misinformation, disinformation.

    and the author continues to play the percent GDP game when it suits him.

    The more relevant metric is what percent of our AVAILABLE revenues should be spent on DOD and entitlements.

    I keep asking – if we are taking in about 1.5 trillion in revenues – then how much of that SHOULD be spent on DOD and National Defense?

    If we could get an answer to that question – we COULD decide how much we could afford for entitlements but it appears that those who advocate against entitlements and in favor of DOD don’t have a number other than “as much as is needed”.

    Now how fiscally conservative is THAT!

  3. Is anybody actually arguing that defense spending is bankrupting America? I’m not aware of anybody making this claim.

    However, I am aware of the question “Can we spend less on defense and still get good results?”, which is the same question we should be asking of all spending categories, including entitlements.

    • Spending is bankruptinc America. I think that includes defense spending. As I recall, it makes up about 1/3 of the federal budget.

      • DOD spending has MORE THAN DOUBLED since 2000. that’s a fact.

        It’s UNDENIABLY part of the increased spending that folks keep blathering about.

        Anyone who thinks that we can’t find cuts in DOD is not serious about ‘spending’.

        We can and should trim entitlements. We should have folks who get Medicare pay more ESPECIALLY for Part C Medicare Advantage.

        but you could zero all entitlements and still have a spending problem because then you’d be spending about 2/3 of our budget on DOD.

        and the truth is that we take in right now about 1.5 trillion dollars and we spend almost all of that on DOD, DOD entitlements and National Defense.

        Rather than blindly blame entitlements, how about this:

        what percent of our available tax revenues should be devoted to DOD?

        pick a number. 50% 60% 40% – pick a number.

        • I have no problem cutting defense spending. But, given that defense is the primary responsibility of the federal government, it should be a significant portion of the budget.

          • I think the point the previous post makes is that in a strictly constitutional budget, so many functions of the federal government would be eliminated, probably the majority of the remaining money could be spent on defense. This is very hypothetical, however. Cutting the current defense budget doesn’t seem hypothetical to me at all.

          • re: Constitutional… the Constitution formed 3 branches of government, one of them being the SCOTUS whose job is to determine the Constitutionality of laws.

            I accept that Constitutionally-defined role and the work product as well.

            To adopt the belief that only what was in the Constitution itself is allowed while ignoring the creation of the SCOTUS and it’s role seems problematic to me.

          • Agreed! Too many people have forgotten that the primary purpose of the federal government is national defense and unification of the states. In other words, the states were meant to operate the primary laws, budget, and social programs as they saw fit. When the nation was first founded there wasn’t a requirement for as many social programs because people were expected to care for themselves, and if you had someone who couldn’t, the community was expected to care for them, not strangers thousands of miles away.

          • Defense has little to do with constant warfare and standing armies. The American Founding Fathers certainly did not support massive military spending and were against the idea of a peace time standing army. As Madison warned, “A standing military force, with an overgrown Executive will not long be safe companions to liberty. The means of defence against foreign danger, have been always the instruments of tyranny at home. Among the Romans it was a standing maxim to excite a war, whenever a revolt was apprehended. Throughout all Europe, the armies kept up under the pretext of defending, have enslaved the people.”

            The federal government needs to spend less than $200 billion on its military, including foreign aid, VA, military pensions, etc. Only then can the United States be the free country that it was intended to be.

  4. let’s say your household spends its budget on a mortgage, car payments, and routine medical care for years…then, as will happen, your wife gets cancer which requires treatments costing more than you can afford…

    do you borrow and risk bankruptcy due your wife’s condition, or do forego the treatments and live within your means?

    • spending more money on DOD and overseas “contingencies” is equivalent to your wife getting cancer?

      I don’t think so.

      we spend more on DOD that the next 10 nations – combined and that does not count all the money we spend on National Defense… and virtually none of it is what we must spend or perish.

      so we’ve got 16 trillion in debt because we can’t help it?

    • If this analogy is supposed to be comparable with defense spending, I don’t get it. Perhaps a better analogy would be: You live in a bad neighborhood. You can borrow on your credit cards to finance a vigilante operation where you attempt to hunt down and kill any criminals with a grudge against you (also killing some innocent people in the process). Or, without borrowing, you spend your money to equip your house with alarms and lethal defense systems so that no sane person would think of attacking it. Then you stay home and let the criminals outside your property kill each other.

  5. First, we see that our non-Iraq/Afghanistan defense spending totals about a half trillion dollars. Entitlements are costing us nearly 3 trillion, and they’ve nearly doubled since the turn of the century.

    LOL…Only half a trillion dollars? Do you know how ridiculous that statement looks?

    And that half a trillion does not account for the VA, the hot wars in Afghanistan and Iraq, the defense related NASA expenditures, the CIA budget for the drone program, the Department of Homeland Security, the NSA budget, the FBI anti-terrorism budget, foreign aid that goes to military programs run by allies, interest on accumulated defense expenditures, etc. The last time I looked about half of the tax revenues went towards defense related activities. While entitlements may be too high a portion of the actual spending clearly defense also needs to be cut.

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