Air University Review, November-December 1984

The Seven-Percent Solution for U.S. Defense

FROM a political perspective, our current approach for presenting military budgets to the general public is seriously flawed. We continually make the mistake of expressing our budget requests solely in terms of the threat and the cost of specific systems needed to counter this threat. However, our country is deeply divided as to the magnitude and immediacy of any threat--a divisiveness that results in a weak base of support for the defense budget in general. When this weakened base of support is combined with a budget process that continually pits individual defense programs against individual domestic social issues, the Department of Defense finds itself repeatedly in an inherent and unwinnable domestic conflict. From day one of our budget submission to Congress, we are on the defensive, trying to hold our budget losses to a minimum against repeated attacks by groups with differing perceptions of either the threat itself or the relative merit of specific defense programs compared with domestic social programs. We are neglecting the need, and the opportunity, to form a national consensus behind defense spending based on what the nation as a whole can afford. Such a consensus would go a long way toward alleviating the irritants built into our present budget process while allowing for more accurate fiscal planning.

The Threat

The country is divided over the actual threat posed to us by the Soviet Union, and it is important for military professionals to recognize the existence and depth of this division. A recent survey conducted by the Chicago Council on Foreign Relations, a moderate and reputable organization, illustrates this division well. It showed 35 percent of the American public oppose sending U.S. troops if the Soviets invade Western Europe, and 49 percent of the people polled oppose sending troops if the Soviets invade Japan.¹ Taken to its logical conclusion, that portion (more than one-third) of the American public which opposes the use of U.S. forces overseas during wartime would probably also oppose the heavy funding of these same forces during peacetime.

What are the reasons for this opposition? While opinions vary concerning the correct use of U.S. forces overseas, the following three ideas seem to have wide support. First, based on our recent experiences in Vietnam, Lebanon, and El Salvador, any military involvement overseas would prove costly and futile. Second, Americans have shouldered the defense burdens of the free world for too long; the West Europeans and the Japanese with their robust (and competitive) economies should provide for their own defense. Third, the foreign policy goals and methods of the two superpowers are essentially the same, with both nations in competition and conflict about interests beyond the control and concern of the average American.

Regardless of whether you or I agree with any or all of these attitudes, we must face facts: given the widespread acceptance of one or more of these opinions, a defense budget request for hundreds of billions of dollars based solely on threat will meet with divided political support.

The Budget Process

Similarly, we are leading with our chin when, we phrase defense budget requests solely in terms of hundreds of billions of dollars or percentages of real growth. Such phrasing allows for direct comparisons of DOD programs with other federal programs competing for the same federal dollars. Initiatives whose payoffs appear far in the future, nonessential, or even potentially life-threatening to many constitute must compete for funding with social programs in which the impact is both immediate and politically popular. And the competition for federal dollars is intensifying. People are starting to realize that no amount of "economic recovery" will eradicate $200 billion deficits in the federal budget. Taxes will be raised, but first, cuts are going to be made. Since 80 percent of the federal budget goes for pensions, health care, interest on the debt, and defense, guess what is likely to bear the brunt of the cuts? Defense will; except in times of national crisis, it has the weakest constituency of the four. And don't bother looking at the other 20 percent of the budget. Some of this funding is deemed essential to the nation (e.g., that needed to run such departments and agencies as the FBI, IRS, State Department, etc.); and in regard to the rest, the conservative Reagan administration with an election mandate to cut federal spending could only make a small dent in the face of committed and entrenched special interests. A January 1983 Gallup poll illustrates the political difficulties: 45 percent of the American people thought the "Pentagon" is getting too much money; only 15 percent held the same view one year earlier.²

Our present budget process exacerbates these attitudes and inhibits DOD budgetary success. The plethora of continuing resolutions, appropriation bills, authorization bills, committees, subcommittees, ad hoc committees, presidential advisory panels, congressional caucuses, etc. has made the defense budget into a year-round issue and a year-round political sore. People are bombarded continually with stories of multibillion-dollar defense programs being started while social programs are being cut. As a result, the defense budget is vulnerable to all kinds of political maneuvering, which, in turn, provokes popular distaste for the entire process, popular distrust of the Congress and the military, and an understandable unwillingness to pay for it all.

The Solution

The question is: "What can we, as military professionals, do?" One answer is to start stressing the defense budget as a percentage of gross national product (GNP). If we could frame the public debate in terms of allocating a specific portion of national wealth to defense, we could lessen the target-rich environment of complex defense issues now provided defense critics and proponents of other programs. We would also be providing a simple framework for people to see just how large the defense budget actually is and what it has been in the past.

The figures given in Table I are the key for understanding the "7 percent solution." When dealing with the general public, we should stress our budget requests not just in terms of threat or hundreds of billions of dollars but also as 7 percent of the GNP.³ Such a percentage of national wealth should satisfy our defense needs in the long run while being an amount that the country as a whole should support.

Table I. Defense Outlays as a Percentage of Gross National Product

Percentage for 1955 through 1984 are based on gross national product and actual budget outlays as reported in the Secretary of Defense's Annual Report to the Congree, Fiscal Year 1985 (Washington, D.C.: Department of Defense, 1984), p. 280, Table 3. The 1985 estimate was extracted from the Air Force Budget Fiscal Year 1985 (Washington, D.C.: Department of the Air Force, 1984), p. A-4, Table 3.

*Estimated

Why would using a percentage of GNP be helpful? First, it allows us to reasonably compare this year's defense budget with that approved by previous administrations and paid for by previous generations of taxpayers. As the table reveals, in the context of defense spending during the past three decades, a defense budget on the order of 7 percent of GNP is not excessive. In fact, since 1960 the U.S. defense budget has averaged 6.9 percent of GNP.⁴ Second, expressing the defense budget by percentage of GNP decreases the opportunities for outlandish budget predictions based on "best-guess" inflation rates. All defense budgets would be based primarily on what the country agreed it could afford. Inflation would be reflected in a larger GNP, which, in turn, would drive a larger defense budget. Third, a consensus behind such a program would allow more accurate fiscal planning; high-ticket systems would not have to be moved to the out-years to make the budget politically palatable. The hazards of doing the latter were recognized in the USAF Strategy and Policy, Assessment, FY 1986-1999:

Any tendency toward optimistic fiscal guidance results in a temptation to be overly ambitious about what is achievable in the out-years. This is a problem facing us in the years immediately ahead; the available data indicate that we may have committed ourselves to numerous programs which we cannot afford in the long-term.⁵

Once we had achieved a consensus on the percentage of GNP to allocate for defense, the debate would center on priorities within the defense budget. We would be forced to discipline ourselves to an even greater extent over intra-DOD priorities. For example, to keep the defense budget within the 7 percent of GNP limit, a new carrier battle group might be funded instead of a pay raise (or vice versa). Our present process of asking the Congress for both the pay raise and the battle group while the funds involved are still being fought for by nondefense interests is a major irritant built into our current budget process.

One note of caution. Launching a massive pro-military propaganda program to ensure DOD budgetary success, for very correct moral and political reasons, would backfire quickly. What we need is simply a change in emphasis in our public pronouncements. While the concept of tying the defense budget to a percentage of GNP is not entirely new, it should be made a coequal partner with threat assessment as a means of obtaining public and legislative approval for defense spending.

Of course, some people think that once the economy improves and the memories of Vietnam fade, Americans will revert to their historical support for the military and a strong national defense. Such projections may be wishful thinking with little substance. With the exception of the immediate post-World War II years, the military has never been a very popular peacetime institution in the United States. In addition, draft exemptions, the unpopularity of military service, and the end of the draft itself have resulted in a rising generation of national leaders who have had only limited exposure to military institutions. For example, less than half of the newly elected members of the U.S. House of Representatives in 1983 had any kind of military experience.⁶ Thus, while time may dim the sharp memories of our failures in Vietnam, it will also decrease the numbers of national leaders familiar with military service.

AS long as social programs and defense requirements are forced to compete for the same dollars day in and day out, we are going to fall far short of unifying the country behind the enormously costly programs associated with a strong defense. As Senator Gary Hart (D-Colo) stated several years ago:

Currently, we are continually on the defensive in securing the funds that we need. If a real economic crunch comes, as many expect, our present base of popular support is too small to avoid massive cuts in the defense budget. Before that happens, we must minimize the irritants built into our budget process, arrive at a national consensus behind our defense effort, and stake out a "piece-of-the-budget-pie" for defense. Our present reactive policy for defending the DOD budget will not stop the coming challenges; perhaps using the concept of "7 percent of GNP for defense" as the bedrock of our existing public relation effort will do so.

Notes

1. J. Reilly, editor, American Public Opinion and U.S. Foreign Policy 1983 (Chicago: Chicago Council on Foreign Relations, 1983), p. 31.

2. "Defense-Deficit Dilemma," Nation's Business, April 1983, p. 38.

3. As comparisons, during 1981 the Soviets spent 15 percent of their GNP on the military; the Japanese, 1 percent; the West Germans, 4½ percent the East; Germans, 7½ percent; the South Koreans, 7 percent; the North Koreans, 9 percent; the British, 5½ percent; the French, 4 percent; and the Cubans, 8½ percent. (Air Force Magazine, December, 1982, p. 151.)

4. Air Force Report to the 98^th Congress, Fiscal Year 1984 (Washington, D.C.: Department of the Air Force, 1984), p. v, Figure 1. During the 1950s, defense outlays were even higher, averaging 10 percent of GNP. See Armed Forces Journal International, May 1983, p. 105, Table 5.

5. USAF Strategy and Policy Assessment FY 1986-1993 (Washington, D.C.: Directorate of Plans, Headquarters USAF, 1983), p. 7, para 2D (3).

6. As reported in the biographical sketches in the 1983 Congressional Directory (Washington, D.C.: U.S. Government Printing Office, 1983). Of the eighty-one freshmen in the 98th Congress, thirty-nine have previous military experience. Of these thirty-nine, only three served more than five years in an active unit.

7. Gary Hart, "Toward a Consensus on Defense," Strategic Review, Fall 1980, pp. 13-14.

Major Jeffery R. Barnett (A.B., Holy Cross; M.S., Troy State University) is an International Politico-Military Affairs Officer, Directorate of Contingency Plans, Hq PACAF. In previous assignments, he has served as a wing executive officer, contingency plans officer, instructor navigator, and navigator. Captain Barnett is a Distinguished Graduate of Squadron Officer School and the USAF Air Ground Operations School and a graduate of Air Command and Staff College.

Disclaimer

The conclusions and opinions expressed in this document are those of the author cultivated in the freedom of expression, academic environment of Air University. They do not reflect the official position of the U.S. Government, Department of Defense, the United States Air Force or the Air University.

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