"Mr Smith said current defence spending maintained Australia's status in the top 15 nations, usually around 13th or 14th.
"In real dollar terms, we spend far greater than any of our immediate regional neighbours, including Indonesia and Malaysia," he said."
Yet, you are so ignorant. First, percent of GDP is a bad scale of Defence spending. In an entitlement society (especially one in debt), the only thing that matters is how much money is left for Defence, after everyone else have had their say.
Table scraps.
The other part of that is that it does not matter much if it is X or Xx2 dollars. The corrupt DMO (and the rest of the entrenched Defence bureaucracy) will find a way to waste it on things that provide no real defensive value to the Nation.
That and more is what won't be reported much in the propaganda publication known as ADM.
1 comment:
Eric; I think the Minister was probably referring to the following good reference, which I have been hammering in multiple forums: http://www.comw.org/pda/120618-Military-Spending-Comparison.html
Relating defence expenditure to GDP is primarily accounting trickery to satisfy the big spend defence lobby. These snippets from authoritative references highlight the dumbness of that yardstick:
'GDP is one the primary indicators commonly used to gauge the health of a country's economy...It represents the total dollar value of all goods and services produced over a specific time period...The income method of determining GDP is calculated by adding up total compensation to employees, gross profits for incorporated and non incorporated firms, and taxes less any subsidies...The expenditure method is the more common approach and is calculated by adding total consumption, investment, government spending and net exports.'
Neither methodology measures real government revenue and thus what governments can afford to spend year on year.
Minister Joel Fitzgibbon valiantly saw need to pull back defence spending projections from a 10 year commitment to the 4 year budget estimates process. The big arms industry protested strongly and Combet subsequently reinstated the 10 year promise so the Federal Government now has egg on face.
The real fault with projected defence spending lies with John Howard who initiated the ridiculous commitment in 2008 to increase by 3 percent per annum in real terms out to 2018, and then by 2.2 percent per annum to 2030. That would have ultimately required an increase in government revenue of something like 40 percent by 2030, a totally unrealistic expectation considering overall national economic priorities.
Relating defence spending to revenue and restricting committed outlays to within the 4 year budget estimates process would force the DoD realm to be less ambitious and much more cost-effective in how it conducts business.
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