Spending to Protect Our Nation

Spending to Protect our Nation

When the terrorist attacks occurred on 9/11 it did more than just affect the comfort level of American citizens. It had an all around impact on how this country will be run for years to come. The one economic impact that I will concentrate on is that the attacks, arguably, but directly effected the U.S. GDP (Gross Domestic Product) and how the national budget will be handled from that day forward.

Since the attacks a number of civil defense programs have been initiated, which leads to more departments asking for an allowance within the national budget. This ultimately is leading to a larger and larger deficit that is quickly encompassing full percentage points of our GDP. There is a debate on how much defense spending is actually needed, because during the Clinton administration there were massive cuts to the defense budget, which lead to critics saying that our military force was in question. These same critics said that without the funds that had been cut-off by Clinton the military would spiral down to not being able to defend the homeland, let alone take on any offensive. The one argument I have is that President Bush was not in office long enough for his increased defense budget to take affect when he overthrew two regimes (Afghanistan & Iraq) with the same military force that was said to be completely ineffective because of lack of funds.

Regardless of what the "poor" military was able to accomplish President Bush has promised to make more funds available for national defense and to pay for the occupation

of those under U.S. control. Under this promise on November 24. 2003 the president signed an authorization bill to set aside 401.3 billion dollars for the Department of Defense. This peacetime spending adds up to be 10 percent more than was spend during the Vietnam and Korean wars. The 401.3 billion is a lot to spend from a budget that already has a deficit over 500 billion, but as crazy as it sounds that's not all the money that will be put toward the military and national defense. As if the 401.3 billion wasn't astronomical enough there is more money hidden within the budget that will go towards the same purposes, which is pulling those funds from civilians. The total of funds that were found hidden within the budget totaled to an actual figure of about 596.1 billion dollars (Higgs Pg. 3) with a breakdown of it as follows (in billions of dollars):

Department of Defense- 344.4

Department of Energy- 18.5

Department of State- 17.6

Dept. of Veterans Affairs- 50.9

Dept. of Homeland Security- 17.5

Dept. of Justice- 2.1

Dept. of Transportation- 1.4

Dept. of Treasury- 0.1

National Aeronautics and Space- 0.2

Other National Agencies- 4.7

Past debt financed of security- 138.7

Total= 596.1 Billion Dollars

With the numbers totaled the defense budget is currently sitting at a solid 3.5 percent of our GDP and there are still questions on how much more we can put in to make this country safe. The White House is calling for more money to be spent on national defense and their economists say that the United States can withstand a gross spending of somewhere around 9 to 10 percent of our GDP. The money to pay for any

extra spending mostly comes from the high-end taxes that if they weren't being spend would be saved and