It was part of the "Peace Dividend" with the fall of the Soviet Union. Europe has had to choose between guns and butter and has decided upon butter. With declining, aging populations trying to support generous social welfare systems, the Europeans don't have money for both, which is why they are spending less and less on defense. The British Navy will be down to 25 capital ships. Europe has been fortunate that the US has provided the security umbrella for them, but it has warped their view of the real world.
The US is heading down the same road as our population ages and the entitlement programs consume more and more of our budget. Social Security pays more than $450 billion in benefits each year. If nothing is done, by 2060, the combination of Social Security and Medicare will account for more than 71 percent of the federal budget. By 2030, there will be 70 million Americans of retirement age--twice as many as today.
And it is going to be really a lot tougher this time. The Clintonites were really very clever. By pushing so much of the force into NG and Reserve status, they created a political clientele, outside the Military, who are NOT going to ever give up those fat federal dollars flowing into their states for NG troops while at the same time NEVER want those troops actually USED by the Feds! We are going to have to rebuild a large active duty force while fighting the political Establishment tooth and nail for every single body and dollar..
I don't believe we will ever return to the active duty force strengths we had in the 1960s or the early 1990s. Some of it has to do with technology and force multipliers that give today's military far more firepower with less manpower. And a lot has to do with money and competing demands for it. The entitlement programs are on automatic pilot and will go belly up in 10 years if nothing is done. More than likely, there will be increased taxes and lower benefits to save failed systems rather than reform them. In 1950, there were 16 workers paying Social Security taxes for every retired person receiving benefits. Today there are 3.3. By 2030, there will be only 2.
Finally, the size of our force will also be affected by the perceived threat and what is needed to counter it. The US already spends more on defense than almost the rest of the world combined. What size military do we need? Or can afford? Under our budget system, defense spending is considered to be a discretionary item.
That is exactly why the President wanted to reform social security but the dems and left leaning Republicans would not support him.