Military Spending, the Reason for the Economic Crises

Today we live in an economic system that needs money we don’t have, but is that true? Our proud nation taxes everything they possibly can to earn money that is eventually cycled through the government. When looking more in depth at the numbers, I noticed an amazing statistic. The statistic was about the United States’ military spending. Did you know the United States spent $711 billion on military expenses in 2008? That is equal to the next 15 biggest military spenders combined (Sharp 1)! China, a country we rely on with foreign trading is the second biggest military spender, and the United States spends nearly six times as much as them. So why do we invest so much money in our military, especially since we haven’t had a war fought on our soil since the Civil War, a war fought between our own men! This issue seems hard to debate, yet our military spending has risen every year for the past ten years (Friends Committee on National Legislation 1). Our nation needs to cut military spending and invest it towards other fields like healthcare, education, and social security.

One big debate is whether military spending boosts economic growth. It’s quick to look at World War II and say “yes it does.” However it’s hard to compare World War II with what is currently going on in the Middle East. Firstly, during the time of World War II, the arrangement of the economy was much different. Not only were there fixed prices for consumer goods, private factories were encouraged to change their companies to produce war related material in return for credit by the government. In a report done by the Congressional Research Service, data indicated that only major wars like World War II have brought major impact on the economy. From 2002 to 2008, the defense budget rose from 3.4% of the gross domestic product to 4.2%, and yet that stimulated no economic growth, and it definitely did nothing to contain our recession we are currently in (Hellman 1). To look at a situation much like the one we’re in now, the best war to look at is the Gulf War. The Gulf War was the previous conflict the United States was in, and before the start of the Gulf War, the United States was in a minor recession. Looking back at the same report done by the Congressional Research Service, they state “It was the only military operation considered that did not require any increase in military expenditures as a percentage of GDP. In fact, it took place during the long reduction in military spending as a percentage of GDP that accompanied the end of the Cold War” (Labonte 16). Here is a great example of how our nation controlled spending, fought a war, and managed to escape the war without any post-war recession. This means there is little reason to believe that adding more money into our defense budget will help our economy.