Argument

The National Security Consensus

The next four years of U.S. foreign policy will look a lot like the past four years -- regardless of who's elected president.

America's political polarization does not extend far into the international realm. For all the rhetoric on the campaign trail, a recent Chicago Council on Global Affairs poll found that Democrats and Republicans have largely similar views on most foreign-policy issues. Republicans are marginally more worried about external threats than Democrats, but a strong majority of Americans now agrees that the Iraq and Afghan wars were not worthwhile, and there is a consensus in favor of a more cautious and selective brand of American global leadership.

The Oct. 21 debate between Mitt Romney and Barack Obama confirmed this consensus. Romney moved toward the center on foreign policy even more definitively than he had in the earlier domestic debates, clearly distancing himself from the neoconservative wing of his party. Assuming Romney would govern from the stance upon which he is now running, one would expect a lot more continuity than change in American foreign policy, no matter who wins the election.

Certainly there could be differences in tone. Romney would presumably be a more unapologetic champion of American exceptionalism. But then Romney wouldn't have much to apologize for, since Obama would have left him a pretty strong legacy in the international realm.

Relations with both China and Russia, already deteriorating, could get worse if President Romney were to carry through on his threat to declare the former a currency manipulator and to treat the latter as America's No. 1 adversary. Obama has also been taking a tougher line on China of late, however. In contrast, Obama might well seek after the election to overcome differences with Russian President Vladimir Putin on missile defenses in Europe, an issue on which Romney would likely be less forthcoming.

Both Romney and Obama have threatened to use military force against Iran if it continues its pursuit of nuclear weapons, and both have discounted the prospect of intervening militarily to help defend the Syrian people from the Assad regime. Both positions are likely to be severely tested in the coming months, no matter who is president.

Without broad international support, an American attack on Iran would probably weaken, rather than intensify, the external and internal pressures upon that regime. Iran is likely to deny Washington any widely appealing justification for such an attack, making this an unattractive option.

On the other hand, both international and domestic pressures for more forceful American action in Syria are likely to build as refugee flows increase, atrocities multiply, extremist groups gain traction and the civil war spills over into neighboring states.

Romney might appear more hawkish on such issues, but George W. Bush's legacies of Iraq and Afghanistan would burden any efforts he might make to rally American and foreign support for any military action. Obama, if he chose a military response in either instance, would have the comparatively low-cost successes of Libya and the hunt for Osama bin Laden to his credit in arguing the case. So while Romney might be more inclined to take military action, Obama would probably have an easier time securing domestic and international support for such a step.

Protecting jobs is by far the top foreign-policy priority of most Americans -- 83 percent in the Chicago Council poll, vs. only 64 percent who thought combating terrorism an important goal.  Republicans are usually more enthusiastic about trade liberalization than Democrats, but Romney's rhetoric on China suggests that protectionism might also be part of the mix in his administration.

For either presidency, much will depend on personalities and events. Obama's team would likely survive largely intact. John Kerry or Susan Rice, both closely associated with current policies, are favored to replace Hilary Clinton at the State Department. Among those who might replace Leon Panetta at defense, should he chose to leave, are his current deputy, Ashton Carter, or his former under secretary for policy, Michèle Flournoy. David Petraeus seems likely to stay at CIA and Tom Donilon will either remain national security advisor or move to another senior post.

With Romney, the question is whether he would pull together a foreign-policy team of personally compatible centrists, as Bush did for his second term, or give fuller representation to the ideological divergences within the Republican foreign-policy establishment, as Bush did in his first term.

It was, of course, not just Bush's initial appointments but the effect of 9/11 that stimulated the interventionist and unilateralist policies of his first term. Shocks of that magnitude could knock any administration off balance, particularly one still feeling its way.

Either president will need to focus initially on largely domestic issues, in particular the looming fiscal cliff and the oft-postponed decisions on tax and spending priorities. It would take Romney considerably longer than Obama to get a new team in place and to flesh out an operable set of domestic policies. New administrations are necessarily inexperienced as a team, even if individuals may have substantial qualifications, and are therefore more prone to unforced errors and missed opportunities. If Romney wins, therefore, American foreign policy would likely be largely event-driven for the next half year (not that any early innovations are necessarily expected from Obama either).

In early 2008, I predicted that a Democratic president would continue the national security policies of Bush's second term. To the discomfort of many of his supporters, that is exactly what Obama chose to do. Today American public opinion is much less divided on international issues than it was four years ago. The two presidential candidates are much closer in their expressed views than were Obama and McCain. Continuity would thus seem an even better bet this time around.

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National Security

Lies, Damned Lies, and Defense-Job Statistics

No, cutting Pentagon spending will not destroy local economies.

In the closing days of the U.S. election season, the airwaves are full of dire warnings about the massive job losses that will supposedly occur if the Pentagon's budget declines significantly in coming years (it hasn't, yet). A series of ads by Karl Rove's Crossroads GPS is typical of the genre. In New Mexico, for example, where Rep. Martin Heinrich is trying to succeed retiring Sen. Jeff Bingaman, one GPS ad explains, "Heinrich voted for deep, automatic cuts that could cost New Mexico 20,000 jobs." Similar ads are running in Virginia. The unsubtle message: No sitting member of Congress deserves to be returned to office or elevated to a higher office if he or she voted for legislation that would actually cut spending.

But an equally effective series of ads might have talked about the jobs that would be created when government spends less and taxes are cut. The Pentagon might be a jobs program, but it isn't a very efficient one. It creates the kinds of jobs that politicians like to claim credit for, but military spending doesn't produce more growth in the economy or generate more innovation than a comparable level of spending by private individuals, businesses, and entrepreneurs.

First, some context. Overall U.S. military spending is likely to decline modestly, but most of these savings derive from the end of the Iraq war and the drawdown in Afghanistan. The Pentagon's base budget (excluding the costs of the wars) remains near historical highs in real, inflation-adjusted dollars and is currently projected to keep pace with inflation, at least into the early 2020s.

Such facts haven't stopped Crossroads and others from asserting that hundreds of billions of dollars have been cut, with hundreds of billions more looming under last year's Budget Control Act. The claim that such cuts, were they to occur, would threaten U.S. national security, is debatable. But most of the focus has been on the tens or hundreds of thousands of people who will be thrown out of work if the cuts go forward.

The source of these statistics? The Aerospace Industries Association (AIA), the trade group representing the interests of some of the United States' largest defense contractors.

The AIA has sponsored several studies on the economic effects of sequestration, and all have concluded -- unsurprisingly -- that they would be catastrophic. One study by George Mason University's Stephen Fuller predicted that a reduction of $45 billion in Defense Department procurement spending would result in the loss of 1,006,315 full-time, year-round equivalent jobs. A subsequent paper, published this July, concluded that the automatic cuts to both defense and non-defense spending would eliminate 2.14 million jobs.

A number of scholars have challenged Fuller's conclusions. The Mercatus Center's Veronique de Rugy faulted the report as "packed full of mistakes, arbitrarily high multipliers … and obscure methodology and exaggerations." The Brookings Institution's Peter Singer noted that no more than 3.53 million jobs -- direct, indirect, and induced -- are sustained by the defense industry, so it is barely credible that a 10 percent reduction in Pentagon spending would result in the loss of one-third of all defense-related jobs.

More to the point, the Defense Department's "role isn't to sustain defense contractors' profits independently of the security they are actually meant to provide," de Rugy wrote at National Review's The Corner, a conservative blog. "Private-sector profit margins or even private-contractor job losses shouldn't prevent sensible reductions in federal spending."

Economist Benjamin Zycher produced perhaps the most thorough assessment of Fuller's study (and others like it) and showed how they grossly exaggerate the harmful economic effects of spending cuts and largely ignore the benefits. "[T]he defense sector is too small a part of the economy," Zycher notes, "for changes in defense spending to have large aggregate effects on GDP." And, historically, defense spending has not had that effect. There is no correlation between defense spending and GDP growth, and Zycher concludes, therefore, that cuts would have very little long-term impact in the future.

Like de Rugy, Zycher argues that it is appropriate for resources to shift out of the military sector and into private sector as wars end and threats diminish. The United States cut spending after the Korean War, after the Vietnam War, and after the Cold War, and these reductions did not throw the national economy into a tailspin, though some individuals and firms did have to seek out other opportunities.

Government spending takes money out of the private sector in the form of taxes or debt (which is simply taxes on future generations) and redeploys that money in the public sector. Granted, the Pentagon represents a special part of the public sector, one that, ideally, creates a genuine public good-- safety. But much of what Americans spend on their military doesn't actually defend them -- it goes to defending people in other countries who have chosen not to defend themselves. Americans are growing increasingly aware of the unfairness of the current system, and they're tired of it.

But the claims that Pentagon spending has uniquely salutary economic effects -- or, conversely, that cuts will have disproportionately harmful ones -- suffer from a basic conceptual error: They ignore the opportunity costs. Simply put, Pentagon spending cuts can be expected -- all other factors being equal -- to generate greater economic activity elsewhere.

The reason why was captured by French philosopher Frédéric Bastiat in 1848. The bad economist, Bastiat explained, focuses only on those economic activities that are plainly visible; a good economist, by contrast, takes account of both the seen and the unseen. It is not enough, for example, to focus on the economic activity that occurs when a careless child breaks a window. True, the glazier gets to sell the shopkeeper a new one, but the shopkeeper had the benefit of a fine window before it was broken. Paying for the repair (the seen) necessarily prevents him from spending that same money elsewhere, thus denying the shoemaker or the butcher of a sale (the unseen) and denying the shopkeeper the benefit of a new pair of shoes or a healthy meal.

The discussion that has taken place during the closing days of the U.S. election season about possible military spending cuts has been predictably narrow. Politicians in Washington focus on the jobs they supposedly create when they spend the people's money, and too little attention has been paid to the unseen benefits that would accrue if the resources that are currently spent on the military were released into the private sector. Put another way, there has been too much focus on the visible effects of ships and planes that are built, and not nearly enough on the houses, schools, and businesses that never are.

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