Are Military Cuts Less Hurtful? A Shrinking Military Budget May Take Neighbors With It

In the political debate over Pentagon cuts, the potential effect on innovation has been largely ignored. Pentagon officials and their allies have instead warned that a sharply smaller military budget would expose the nation to harm, and that such cuts would result in a large and immediate rise in unemployment.

Independent economists and analysts say that concern about the short-term economic impact is largely misplaced. While reducing the Pentagon’s budget would cause considerable economic pain — some workers would lose their jobs; some contractors would lose their most important customer — research suggests it would be less painful than cutting other kinds of government spending, like education or transportation.

A significant portion of the military budget, including the wages of armed forces personnel, is spent abroad. And military spending in this country, like building a new runway at a domestic Air Force base, tends to bring fewer spillover benefits than many other forms of government spending, like a new runway at a commercial airport.

“As a source of job creation, military spending is not particularly good,” said Robert Pollin, an economist at the University of Massachusetts, Amherst. “You can argue for the benefits in geopolitical terms, but if we’re talking about jobs and the economy, it doesn’t make sense.”

The Pentagon spends about 12 percent of its budget in that area, about $81.4 billion during the most recent fiscal year. That is roughly 55 percent of all federal spending on research and development.

The New YOrk Times, continuing its attacks on civilization generally, has a kicker in the print edition of this story that reinforces the notion that spending cuts for military spending don't cost as much as say, spending cuts in education and transportation.

When is the Grey Lady going to get a clue that she can't expect to be taken seriously in the future if she keeps making statements that are belied by the facts? The article notes the SERIOUS R&D developments that can be traced to military spending, but does not record the societal benefits of having a trained workforce, of industrial spending, of how historically military spending has helped, how the military spending has created a network of cell towers in Afghanistan, etc. This is a joke of an article.

We need to cut the federal budget, and the military is no exception. Some of this article was pretty good, like investigating how well military R & D pays off. But for the most part the article completely misses the point.

When deciding between the military, education, and transportation, the military is the most constitutional. Certainly constitutionality should be a factor in what should be cut in order to fix our budget problems.

Military personnel forced out of service are entitled to unemployment benefits, but even for junior enlisted personnel, it’s only a fraction of their armed forces salary, and without the benefits they enjoyed while in uniform.

And here’s something else that has gone unreported in the celebration over the latest job numbers: the unemployment rate for young veterans—those who separated from active duty since 9-11—actually climbed more than two percentage points in December. The most recent figure is 13.3% for December, compared to 11.1% in November.

By some estimates, at least 95,000 service members will be leaving the military over the next two years, and with Obama’s just-announced “additonal” cuts, the total may be closer to 200,000, mostly from the Army and Marine Corps. Wonder what the unemployment rate for young vets will be in 2014?

And this is just the tip of the ice berg; by placing military procurement on what appears to be a permanent holiday, the defense industry will lose tens of thousands of jobs in the private sector—many paying over $100,000 a year, with outstanding benefits and retirement plans. Once lost, many of those positions will never return.

Given our fiscal crisis (and Obama’s skeedaddle from Iraq and Afghanistan), some defense cuts were inevitable. But the incompetent-in-chief is absolutely gutting defense, and I haven’t seen one general or admiral resign in protest.

One more thing: like those unemployed workers who keep disappearing from the workforce, Obama and Co. will find ways to obscure disappearing defense jobs. Look for most of the reductions in force to occur in FY’2013 (after the election), and the official cancellation of many defense programs will occur in the same timeframe.

Actually, there is NO justification for most of the departments we now have including: education, HUD, agriculture, energy, commerce, etc. Any functions that could be justified would be to coordinate and reconcile the functions performed by the states. Example, EPA would have a maximum of 50 personnel to perform research, provide information to the states, perform conferences to facilitate the exchange of information, etc. They would have no regulatory or enforcement ability. The same goes with other departments.

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