Defense spending and national well-being

Saturday’s New York Times contained an interesting op-ed piece by Charles Blow, titled "American Shame." The main item was a table listing the 33 countries designated as "advanced economies" by the International Monetary Fund and comparing them on various social and educational characteristics. Specifically, Blow charted income inequality, unemployment rates, level of democracy, the "percentage thriving" (according to the Gallup Global Well-Being Index), food insecurity, prison population, and student performance in math and science. The bottom line: The United States is at the bottom of the heap on most of these measures, and at or near the top in none. 

It’s a sobering collection of data, to be sure, but I wish Blow had added two more columns to his chart: 1) percentage of GDP devoted to defense, and 2) defense spending per capita. According to the 2010 IISS Military Balance, here’s what those columns would have looked like (the countries are in the order presented by Blow, which reflected their summary ranking on the various measures, from best to worst):

Country            Defense $/GDP (%)     Defense $/population (2008)

Australia                 2.24                         1,056
Canada                     1.19                             597
Norway                     1.49                        1,264
Netherlands             1.41                            738
Germany                    1.28                            570
Austria                     0.77                            389
Switzerland                 0.83                             542
Denmark                  1.94                             344
Finland                      1.33                             693
Belgium                     1.10                             534
Malta                         0.60                             122
Japan                         0.93                             362
Sweden                      1.30                              736
Hong Kong                   n.a.                               n.a.
Iceland                         0.27 (200                  153 (2006)
New Zealand               1.39                             420
Luxembourg             0.43                             478
United Kingdom        2.28                             998
Ireland                        0.60                             382
Singapore                   4.20                            1,663
Cyprus                         2.16                              503
South Korea              2.60                             500
Italy                            1.34                              532
France                        2.35                           1,049
Czech Rep.                 1.46                              310
Slovenia                      1.53                               415
Taiwan                        2.76                              458
Slovakia                      1.55                               271
Israel                           7.41                           2,077
Spain                           1.20                              276
Greece                        2.85                             946
Portugal                      1.53                             349
United States            4.88                          2,290

And just for fun, let’s toss in:

P.R. China                1.36                            45

I’m not suggesting that excessive defense spending is the only thing that explains America’s relatively poor performance on these social and economic indicators. As the Singapore example suggests, a small state can spend a relatively high percentage of GDP on defense (and a relatively large amount per capita) and still do fairly well on some measures (e.g., student test scores). Moreover, there are lots of other factors that influence how well a state performs on these social and economic measures, which is why countries with equally light defense burdens still vary a lot on the different quality-of-life measures.

But surely the amount the U.S. currently devotes to "national security" has two negative effects. First, it encourages a lot of other countries to free-ride, leaving Uncle Sucker to pick up the slack in places like Afghanistan but also in some other areas (such as East Asia). Second, it cannot help but divert money that could be used for other valuable social purposes (education, health care, national infrastructure, personal consumption, etc.). We could even spend the money we need to fix things like dams. Spending that money wisely at home would leave many Americans better off and facilitate long-term economic growth. 

I’d also argue that a somewhat smaller military and a foreign policy that was less geared to overseas intervention would also diminish anti-Americanism in many places. Over time, fewer people would be joining anti-American terrorist groups and calling for further infringements on civil liberties here at home. Doing somewhat less might encourage others to do more, and some states might even compete to try to win our favor, if we were more selective in whom we agreed to protect. But those are different issues.

In any case, as Democrats and Republicans spar over how to cut the deficit, I hope they took a look at Blow’s table. It would be nice if some of them would also take a gander at these two additional columns. Perhaps a little light bulb will go off.…