Somebody Give Schmitt and Donnelly a Calculator

Good news! Gross Domestic Product (GDP) in 2006 was a whopping $13.2539 trillion.

Now that we know that, The DEW Line gets to ask the billion (or even trillion-) dollar question: how much of that bounty needs to be invested in the defense budget?

Your answer will depend on how you read the trends in the global security posture and how you assess certain key future geo-political scenarios. In other words, make your best — read: least risky — guess.

Gary J. Schmitt and Thomas Donnelly — a resident scholar and resident fellow, respectively (er, who out-ranks who, we wonder?) — at the American Enterprise Institute have made their best guess very public in a new book called Of Men and Materiel.

Based on their premise that the current budget is woefully inadequate in the current security landscape, AEI’s star residential duo make two claims: 1) the current defense budget is too low and 2) the budget should be sized at 5% of GDP.

In short, one nickel of every dollar produced in the US each year should go to spending on troops, weapons and — most importantly, perhaps — more analyses of the defense budget by Schmitt and Donnelly.

Why 5%, you may ask? Well, we’re not quite sure. Besides its value as a nice rhetorical rallying point, the authors make no attempt to quantify their analysis. They don’t even bother explaining what is the actual percentage share of defense spending (about 3.7% in 2006 actually).

The DEW Line is not brave enough — or, frankly, educated enough –to thoroughly crunch the numbers ourselves, but we will venture to make one minor, little, miniscule, probably completely insignificant point about the analysis of Schmitt and Donnelly: it’s redundant.

We know that the Federal Reserve is projecting GDP to rise to $14.2 to $14.3 trillion in fiscal year 2008. We also know that the Defense Department is asking for funds totaling about $650 billion in 2008, if you add up the base budget, the Global War on Terror request, military construction and the Department of Energy’s nuclear weapons complex.

According to the seldom-used calculator program in our laptop computer’s “accessories” folder, that total adds up to 4.5% of projected GDP in 2008.

That means at this point the DOD is just a $60 billion to $65 billion supplemental budget request in fiscal year 2008 from reaching Schmitt’s and Donnelly’s 5% target.

Is there anyone out there who doesn’t believe the DOD will ask for – and receive – a second major supplemental spending package in an election year?

So, Misters Schmitt and Donnelly, congratulations! You have managed to forecast the inevitable. Now do you think the defense budget is too low?


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