True or false: The defense budge is so huge, that our economy is dependent on it,.?

Question

When it's close to the trillion dollars, you're talking real money.

Answer 1

The answer is both true and false.

Our economy is not directly dependent on the defense budget - however our economy is dependent on our ability to protect our economic interests.

The best way to think of the defense budget as like an insurance policy. As long as you do not need it you regard it as an expensive waste of money. But when you do need it you regret not getting better coverage.

Answer 2

This is both true and false. If you stopped spending money today on defense – stopped cold, the economy would start to crumble and we would head into a depression which we could recover from eventually. The true part is that most presidents in order to spur the economy increase government spending. This is mostly in the form of big ticket government (defense) spending. You can banter the topic around – but the defense spending extends to almost all parts of the national economy.

When you do the common things in life in an uncommon way, you will command the attention of the world. - George Washington Carver

Answer 3

False. The Defense budget is ~4% of the Gross Domestic Product, and less than one fifth of the total Federal Budget. In a "typical year" Americans spend more money on tobacco products than goes into the military.

http://www.heritage.org/Research/Budget/bg2022.cfm

The majority of the Federal Budget is "Entitlement" payments -- handouts from the Feds to buy votes.

Answer 4

Yes, our economy is dependent upon it. Just look at when they want to close a base how much the communities fight for it-not because it is good for the US, but because it is good economically for their community.

And now how many communities are getting defence contracts and are now reliant on the jobs that those create. If we were to have a reduction in military spending, then our country would go into an economic decline for many years as we changed over to a peace time economy. Won't happen though.

Answer 5

Those trillion dollars pay a lot of wages in the military and the defense industry. Reducing it to zero from one day to another would definitely affect a lot of people and the economic stability.

But a whole economy can not be dependend on the defense budget as it does not create any value itself but just helps create a stable environment for other people to create value.

Answer 6

I read once that megabucks capitalist actually created the Soviet Union as a required foe that is necessary for the continuance of capitalism. After that illusion was worn out
they needed a new foe, presto China, and or Islam or some other boogieman, that threatens our security warranting our huge defense expenditures.

Answer 7

Actually, the nominal defense budget (less the additional funding for Iraq) is a little over 3% of GDP and about 15% of the overall government budget.

Answer 8

Sounds about right.

The odd thing was our economy thrived in the 90's, when they supposedly shrank that budget.

But at this point, it's all war all the time.

---Dave Stark: yes the military is 4% percent of the GDP. But the GDP is not the way to measure the ancillary impact. First off it dismisses as unimportant the cost of the current war. Why do that? But more importantly it dismisses the all too apparent reality that industry that is geared to war does not manage infrastructure and real world service of the nation... not just social entitlements, but bridge buildings, sewage, garbage, schools, highways are in decline. War makes a lot of money for investors, and producers of military goods. Peoples needs are not met.

Answer 9

False

Answer 10

Totally false. As a percentage of GDP it's about half of what it was back in the 60's.