Caller "Terry": Is the budget -- is the defense budget extravagant as it exists now?Economist Jared Bernstein: Backing into the question -- Terry has a great question. First of all, is defense spending...Diane Rehm: ...extravagant?Jared Berstein: ...extravagant? It's very high right now, about $700 billion. I looked this morning at the real numbers, adjusting for inflation over the last 10 years. Defense spending is up almost 90 percent. Everything else is up about 50 percent. But every -- I think it's widely agreed upon that those numbers have to come down. So in a sense, Terry is making a point that is agreed upon, although, as we're discussing, how quickly and how much is up for grabs. There's another point that she hit and that I want to quickly reference. You know, Republicans go around saying government doesn't create jobs. Government is a job killer. Government is -- got to get the government out of the economy. Now, all of a sudden, all those same Republicans are big Keynesians, just about as big a Keynesian as I am. Every dollar the government spends is tied to a job. So I guess it's not a newsflash to point that hypocrisy. But as someone who has been pointing out for a long time that, yes, government spending plays a key role in our economy, I find it a little ironic.
Mackenzie Eaglen, research fellow at the American Enterprise Institute’s Marilyn Ware Center for Security Studies: I'm asked this question every day as you might imagine. It is a big defense budget as it should be when you have forces engaged in hostile combat operations up until recently in Iraq and Afghanistan. We still have 100,000 forces in Afghanistan right now, U.S. only. It's expensive. And I agree it should not have been debt financed, and that's a debate for another show. But the defense budget that's not war spending, it's big. It's about a half trillion dollars. It's -- in real dollars, it's very high. But as a percentage of our economy, it's almost at a historic low. So it really just depends on how you look at the defense budget. And I'll go back to the point I made earlier. Half of that budget pays for people. And so when we're talking about the defense budget, most people tend to think, well, it's just all these fancy weapon systems and we can just get rid of those. There's all these waste. The Pentagon is not immune to belt tightening. It certainly should be a part of reform initiatives.
Diane Rehm: But am I correct in saying that that defense budget in total is 15 percent of the overall...Jared Bernstein: Twenty.
Diane Rehm: …budget? Twenty?
David Welna, NPR's Congressional correspondent: Well, that's if you look at all of the government's...Diane Rehm: Everything.
Jared Bernstein: It's political war.David Welna: ...all the -- everything that the government pays on interest on debt: Medicare, Social Security, all of the mandated spending. The discretionary spending is only about a third of the federal budget, and then defense spending is about half of that. So that's where you get the 15 percent.
Mackenzie Eaglen: It's about $1 in every five goes to the defense budget.
Jared Bernstein: Yeah. That's correct.
David Welna: Right.
Diane Rehm: OK.
Jared Bernstein: Can I just make one quick point on this?
Diane Rehm: Sure.
Jared Bernstein: And you raised this earlier, Diane. You know, we've been talking a ton about defense, and that's really important. I stipulate to a lot of Mackenzie's points with exceptions I've raised so far.
But, you know, the non-defense side is in many ways equally important, cancer research. Think about that. Think about the food safety, the FBI, veterans' benefits. There are veterans' health benefits in the nondiscretionary side. All of these strike me as equally important, yet somehow the debate is focusing just on the defense side.
Can't imagine why. Oh, right. We live in an imperialist, capitalist, um, paradise. (Take that pacifist socialist Bernstein fella out right now and waterboard him.)
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