Greg Mankiw’s blog pointed me to the Friday editorial in the Wall Street Journal, titled “Our Small Defense Budget: This is no way to fund a war.” I read it, and it struck me that something very important was missing from their analysis—so I took the liberty of adding the missing information to the chart. In short, the missing piece is this: One of the primary purposes of a national security budget is to prevent wars from starting in the first place—a.k.a. "peace through strength." Reagan knew what that meant, and he followed through on his conviction. But our collective memory of what he accomplished apparently faded.
My notations are in color; self explanatory, I hope. For more detail on this important topic, see the article I wrote almost two years ago, titled “Rethinking the Surplus.”
Please note that "national security" comes from more than just the defense budget. I prefer the broader description that stuck with me after I read it ten years ago:
National security is the combined result of four key elements:
(3) military force potential; and
(4) the will to use #3 if necessary.
Lastly, I think the quote I posted a week ago bears repeating here—especially for anyone who still thinks wistfully back to the late-90s surpluses.
A science [economics] that can describe minute changes in the price of a bushel of corn does not even try to place a value on any aspect of human welfare. To the old economists, surplus corn warehoused in silos is more valuable than all of the lives saved by avoiding a war. Because they are unable to place an exact value on human life and happiness, as you can on a bushel of corn, the old economists don't even try to give it any value at all. And they blithely dismiss those who do.
—Dr. Rick Boettger