The Washington Post (4/29/13) had an odd headline on the front page of Monday’s paper:
Defense Cuts Pose a Paradox for Left
The last word of the headline was changed to “liberals,” but the message is essentially the same: There are cuts to military spending, due to the sequester and the winding down of the wars in Iraq and Afghanistan. And that drop in spending slows economic growth and causes job losses.
Reporter Zach Goldfarb explains the “conundrum” this way:
Liberal lawmakers and others on the left have argued for years that the military budget is bloated and should be dramatically scaled back. At the same time, they have been major advocates of government spending to help drive economic growth and create jobs.
That seems generally on the money–but those principles are not necessarily in conflict.
For starters: How big is this drop in military spending? Goldfarb writes:
As a percentage of gross domestic product, defense spending started picking up after the attacks of September 11, 2001, rising from 3.8 percent and peaking at 5.3 percent in the fall of last year.
In the first three months of this year, military spending made up only 4.8 percent of the size of the economy, and that is likely to decline more.
So as a percentage of the economy, military spending is still a percentage point higher than it was before 9/11. This is not as dramatic a shift as one might think.
The more important question is the usefulness of military spending as a form of job creation. Goldfarb touches on this when he writes:
The shrinking Pentagon budget also raises tough questions for liberals about the role of the military as a source of employment. At a time when the country is struggling to keep good-paying manufacturing jobs from going overseas, weapons systems and armored vehicles must be made in the United States, creating jobs at home.
The real issue is whether or not this a particularly effective way to create jobs. The Political Economy Research Institute at the University of Massachusetts/Amherst compared different forms of public spending (11/28/11), and here’s what they found:
Our conclusion in assessing such relative employment impacts is straightforward: $1 billion spent on each of the domestic spending priorities will create substantially more jobs within the U.S. economy than would the same $1 billion spent on the military.
Or, for the graphically-inclined (courtesy of Think Progress):
The point is that shifting spending from the military to other types of government spending would be more broadly beneficial to the economy. It’s hard to imagine many people on the left who wouldn’t support this. So why is it portrayed as a “quandary”?