Baker Spring at the Heritage Foundation makes the case that the defense budget should be pegged to 4% of the Gross Domestic Product. He warns that if no action is taken soon, defense spending as a percetange of national economic output will decline to 3.2% by 2012.
This is the calm before the storm. The US defense budget tends to rise and fall at roughly 15-year intervals. The current upward cycle since 1998 is stretching the interval beyond its normal apogee. A defense spending freefall could be around the corner, although some analysts, such as defense industry optimist Loren Thompson, believe the upward spending track may continue indefinitely. But the fear of a freefall among defense hardliners and profitmakers remains, so expect to hear many such calls for tying defense spending to economic output over the next few years.
How simply a budget flattening? Why does have to be the skys the limit or the sky is falling. More likely it will simply level out and gradually tapper back. Also, why would you peg the budget to GDP. That doesn't really make sense in the face of other pressures. Further, fixing the budget to GDP doesn't provide the flexibilty necessary to exceed levels when required. The argument that pegging the budget will protect it doesn't hold when you consider that Congress would have to fix the budget to GDP and could just as easily move the % points around.
Posted by: Justin Tkach | April 28, 2008 at 04:38 PM