Center for Arms Control

Security Spending

by Laicie Olson [contact information]

U.S. vs. Global Defense Spending

May 21, 2010

The United States remains the global leader in defense spending, surpassing the next closest country by more than eight times.

In a recent speech to the Navy League’s annual Sea-Air-Space Exposition, Secretary of Defense Robert Gates pointed to just a few of the many extreme cases in which U.S. defense outweighs that of other countries:

The U.S. operates 11 large carriers, all nuclear powered. In terms of size and striking power, no other country has even one comparable ship.
The U.S. Navy has 10 large-deck amphibious ships that can operate as sea bases for helicopters and vertical-takeoff jets. No other navy has more than three, and all of those navies belong to pure allies or friends. Our Navy can carry twice as many aircraft at sea as all the rest of the world combined.
The U.S. has 57 nuclear-powered attack and cruise missile submarines – again, more than the rest of the world combined.
Seventy-nine Aegis-equipped combatants carry roughly 8,000 vertical-launch missile cells. In terms of total missile firepower, the U.S. arguably outmatches the next 20 largest navies.
All told, the displacement of the U.S. battle fleet – a proxy for overall fleet capabilities – exceeds, by one recent estimate, at least the next 13 navies combined, of which 11 are our allies or partners.

Those numbers focus only on the Navy, but extreme examples like these span every branch of the Department of Defense.

In 2008, the most recent year for which complete global data is available, the U.S. approved $696.3 billion in defense budget authority (fiscal 2010 dollars). This figure includes funding for the Pentagon base budget, Department of Energy-administered nuclear weapons activities, and supplemental appropriations for Iraq and Afghanistan.

This number is eight times more than Russia, 15 times more than Japan, 47 times more than Israel, and nearly 73 times more than Iran.

In inflation-adjusted dollars, the total U.S. defense budget has grown from $432 billion in fiscal 2001 to $720 billion in fiscal 2011, a real increase of approximately 67 percent. The Congressional Budget Office has regularly warned that discretionary spending will come under increased pressure in the coming years. The legacy of the recent economic crisis will be a high and rising debt that must be addressed across the board.

“It is not a great mystery what needs to change,” Gates said. “What it takes is the political will and willingness, as Eisenhower possessed, to make hard choices.”

2008 Defense Expenditure (in billions of current U.S. dollars)

Country 2008 Spending
United States (including war and nuclear) 696.3
Rest of NATO 325.5
Non-NATO Europe 26.8
Russia 86.0
Middle East and North Africa 110.5
Sub-Saharan Africa 12.1
South and Central Asia 41.2
East Asia and Australasia 131.3
China 83.5
Latin America and Caribbean 58.0

Global Total: $1.57 trillion

Countries of Interest (in billions of current U.S. dollars)

Country 2008 Spending
United States (including war and nuclear) 696.3
Canada 19.8
China 83.5
Russia 86.0
United Kingdom 60.8
France 67.2
Germany 46.9
Japan 46.0
Italy 30.9
Saudi Arabia 38.2
South Korea 24.2
Israel 14.8
Taiwan 10.5
Iran 9.6
North Korea **
Pakistan 4.4
Venezuela 3.3

Table/Chart Notes: U.S. figure includes funding for wars and nuclear weapons. Data from Congressional Research Service, Office of Management and Budget, International Institute for Strategic Studies.

**North Korea

The U.S. State Department estimates North Korean military spending at as much as a quarter of GNP, with up to 20% of men ages 17-54 in the regular armed forces.

Unfortunately, any publicly available estimates on DPRK defense spending are unreliable.

METHODOLOGY

Unfortunately, there is no such thing as an agreed-upon international definition for “defense expenditure.” Many countries count spending differently and, in some cases, transparency is an issue.

The analysis above uses data from The Military Balance 2010, the authoritative reference almanac produced annually by the International Institute for Strategic Studies. Defense spending estimates for China and Russia, both of which regularly underreport their annual military budgets, have been reported using a methodology known as Purchasing Power Parity (PPP). The Military Balance typically uses market exchange rates to convert countries’ defense spending figures into U.S. dollars. In the case of China and Russia, however, the market exchange rates fail to fully reflect the purchasing power of the yuan and the ruble, respectively. To compensate for this, The Military Balance 2010 uses PPP. This allows for a more balanced calculation of the numbers. All of the figures for China and Russia in the analysis above use PPP figures, which are significantly higher than both officially reported and market exchange rate figures.

The bottom line is that this analysis uses the highest possible defense spending estimates for China and Russia.

Laicie Olson 202-546-0795 ext. 2105 lolson@armscontrolcenter.org

Laicie Olson is Senior Policy Analyst at the Center for Arms Control and Non-Proliferation, where her work focuses on weapons proliferation, military spending and global security issues.

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