Dampening the Impact of U.S. Defense Budget Cuts

By Mitch Yoshida, Mayme and Herb Frank Research Fellow

As the Obama administration and Congress struggle to agree on a plan to raise the debt ceiling and reduce future deficits, it’s clear that the defense budget will be on the chopping block. While no agreement has been reached on an exact figure, current proposals seek $400 billion to $1 trillion in cuts over the next decade or so. Gordon Adams, a defense budget expert at the Stimson Center, argues that cutting $1 trillion over the next decade in an intelligent way would pose little to no risk to national security and could even enhance it. Others, including several generals and commentators, are less sanguine; in their view, the cuts under discussion would seriously undermine national security.


These disparate assessments stem from different assumptions about what the international security environment will look like in the coming decades. But predicting the future is a difficult (and in this case, dangerous) endeavor, and the uncertainty inherent in doing so should be hedged against whenever possible. Adams argues that China probably won’t challenge the U.S. militarily given the latter’s enormous lead (a reasonable assertion), but there is little reason not to hedge against this and other prospective threats when it can be done in a way that also reduces the cost of defense.


How can this be accomplished? U.S. policymakers should deepen defense cooperation with our closest democratic allies as a complement to paring down defense spending in an intelligent manner. At the transatlantic level, the barriers to a truly open defense market are many. But European defense cuts and the munitions shortages they encountered during the NATO operation over Libya could make it an auspicious moment to advance proposals for a more open transatlantic defense market. Doing so would afford both the U.S. and Europe more military capability at less cost as defense resources become scarcer.


Even if this proves to be too politically sensitive, additional multinational projects like the Joint Strike Fighter (F-35) would have a similar effect. As NATO Secretary General Anders Fogh Rasmussen recently argued in Foreign Affairs, such cooperation is becoming increasingly important due to the rising cost military equipment. NATO itself, he suggested, could “act as a matchmaker, bringing nations together to identify what they can do jointly at a lower cost, more efficiently, and with less risk.” In light of our overall fiscal situation, unavoidable defense budget cuts, and uncertainties regarding the future threat environment, it’s time to seriously consider this proposition.

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