Americas Defense Meltdown - IT Acquisition Advisory Council

224 • Understand, Then Contain America’s Out-of-Control Defense BudgetIt is apparent that no measure from threat countries, or from any other externalsource, is used to size the Pentagon budget. The only limit would appear to be howmuch money the politicians in the Pentagon, Congress and the White House arewilling to throw at it.Non-Threat Based Justification for Larger Defense BudgetsA significant number of important people in government and think-tank punditry haveadopted a measuring system to size the U.S. defense budget independent of the externalworld. It is a system that – conveniently – can justify an even larger, indeed ever growing,defense budget. At the head of this highly politicized parade is the Chairman of theJoint Chiefs of Staff, Adm. Michael Mullen. He has been advocating a defense budgetbased on the size of the U.S. economy. The Pentagon’s “base” budget should, 1 he says,increase from 3.3 percent of America’s Gross Domestic Product to 4.0 percent.His is an advocacy of stupendous brilliance and stupidity at the same time.The amount sounds modest, just 0.7 percent more. Why should that be any problem,especially if, as he and others say, we spent much more during the Cold War, suchas the 8.9 percent we spent in 1968 during the Lyndon Johnson administration?Data from the Treasury Department shows the Gross Domestic Product, the approximatesize of the U.S. economy, to be $13.4 trillion. If we increase the Pentagon’s“share” of it from 3.3 to 4.0 percent, that 0.7 percent increase comes to $94 billion.On top of the $518 billion Mullen is also asking for, it is no small amount.It is a lot more than a large increase masquerading as a puny percentage; it seeks tobase the top-line amount of the U.S. defense budget on something that poses no threatto the United States. He wants to size the defense budget based on an internal attributeof the country, the national economy, that makes us stronger, not weaker. It is onlybecause the U.S. economy has been growing more than the defense budget over time,that it makes the defense budget appear to have become smaller when it has, in fact,grown larger. Moreover, using this measure, it can be argued that we have somehowbecome laggards with our current all-time high defense budget. (Recall Figure 1.)The admiral’s argument also implies the extra dollars to expand defense spending areeasy to find. Now spending “only” 3.3 percent compared to percentages twice that, andmore, in the past gives one the sense that the money now “missing” from the defensebudget can be found lying around, performing no useful function. In truth, you haveonly three places to find the “extra” money: 1) through increased taxes, 2) in otherfederal spending, or 3) from growing the federal deficit. Admiral Mullen and the otheradvocates of this measure of the defense budget forget to tell us which they prefer.The specious nature of this measure is apparent when you consider what Mullenwould also link defense spending to. As the economy has grown, so too have the numberof McDonald’s hamburger franchises in the country. It would be just as “rational” to basePentagon spending on the number of golden arches in American towns and cities.