From 'military reform' to 'defense transformation' (Part 1 of 2)

Research Papers in Economics, 2012

This article is articulated in two sections. In the first-one we try to explain the dynamics of military spending and others social expenditures in the period 1988-2010 for the United States. According to empirical data we support the argument that there is a remarkable trade-off in the allocation of public spending, because, often, the increase in military expenditures was to detriment of those for the education, social security and health. In the second section we analyze the transition from the old "military industrial complex" to the new "military security system" in the light of defense industry restructuring. We focus in particular on the role of financialization and industrial concentration of the firms.

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International Journal of Financial Management and Economics, 2025

This article examines the multifaceted relationship between military spending and government budgets through a detailed analysis of trends and data from the past two decades. Global military expenditures have risen steadily, reaching an estimated US$2 trillion in 2021 according to the Stockholm International Peace Research Institute (SIPRI, 2021). Using crosscountry datasets from sources such as the World Bank (2021) and the International Monetary Fund (IMF, 2022), our study demonstrates that countries allocating more than 3% of their GDP to defense often experience fiscal deficits exceeding 2% of GDP. Moreover, empirical evidence indicates that a 1% increase in military spending relative to GDP can be associated with a 0.1-0.3% rise in the debt-to-GDP ratio over the medium term (OECD, 2020) [3]. In addition, the analysis highlights the crowding-out effect, whereby higher defense budgets divert resources from public investments in education, healthcare, and infrastructure. Case studies from the United States, European nations, and emerging economies underscore the trade-offs between national security imperatives and fiscal sustainability. Policy implications include recommendations for enhanced budgetary oversight, diversified investment strategies, and incremental spending reforms to balance security with long-term economic growth.

The Indonesian military (Tentara Nasional Indonesia, TNI) appears to be taking advantage of a weak president and unpopular police to try and regain some of the internal security functions that it lost as part of the country’s democratisation process. The government needs to strengthen civil control of the TNI and prevent the creep of military influence into areas unrelated to its core function of defence.

Southeast Asia Observatory Working Paper, 2011

Between 1966 and 1998 senior members of the Indonesian military were appointed to legislative and administrative bodies and occupied key positions in the bureaucracy as well as in state-owned corporations. They also held a number of legislative seats in the parliament and influenced the government-supported party GOLKAR. Since 1998, however, a process of democratization has led to a greater civilian control of the armed forces. The study focuses on this process as well as on the external challenges faced by the Indonesian armed forces.

Bulletin of the Atomic Scientists

The Disappearing State?, 2007

2020

The purpose of this paper is to examine the rise of defense spending in the United States. It is important to study the causation of increased U.S. defense spending because it currently holds the largest defense expenditure in the world, especially in most recent years. I am interested in understanding the reasoning behind these appropriated defense budgets. There are multiple factors to consider in determining the relationship between defense spending and the logic that justifies it. The use of federal resources and federal budgeting are a political process that has become a central issue in terms of government overspending for national defense. Funding for the Department of Defense and other budget sectors within the defense budget have risen substantially and have grown more rapidly than the U.S. ever initially projected. International threats, competition, and executive policymaking have also had a large effect on our government’s military budgets. This work will look at the maj...

Project on Defense Alternatives Briefing Report #20, 2010

The allocation of Pentagon funds changed fundamentally during the period 1992 and 2010. And with it, the contours of American military power changed, establishing the foundation for force development and budgeting through to the 2020's. This report analyzes the unprecedented post-1998 rise in US defense spending, the return to Cold War budget levels, and likely future trends in Pentagon spending. It asks, Why should defense be as expensive today as during the Cold War? And also, Why are today’s wars comparatively so expensive? Among the “cost drivers” that it finds are overly ambitious US military strategies, a shortfall in efforts to streamline the Pentagon and achieve military transformation, a failure to set strong priorities and make hard choices in military acquisition, and the conduct of wars ill-suited to the US military. Also assessed are the surge in military construction and the dramatically expanded role of private contractors. 75 pages including short Executive Summary and 21 charts and tables.

International Journal of Academic Research in Business and Social Sciences, 2019

Most if not all countries in Southeast Asia have continued to increase their defence expenditures since the end of the Cold War. However, the literature in this area is still lacking and another similar study merely focuses on countries in the Middle East and the Far East. This study aims: (1) To analyse the trends in defence expenditures of selected countries in Southeast Asia, namely Indonesia, the Philippines, Malaysia, Singapore and Thailand and (2) To identify other factors that may affect their defence expenditures. This study applies a qualitative research method called content analysis from the Military Balance online database by compiling defence expenditures data in selected countries in Southeast Asia from 1988 to 2007 for the first aim and reviews existing literatures on factors that may affect their defence expenditures for the second aim of this study. Results show that there is a decreasing trend for defence expenditures as a percentage of GDP and an increasing trend of the actual amount of defence expenditures. This study also indicates that there are other factors that may affect their defence expenditures: military technological advancements; quality, prestige and force-multipliers and arms race or maintaining the status quo. The contribution of the study is to verify evidences that these selected Southeast Asia countries need to develop their own defence for their national sovereignty and integrity to replace old and antiquated military equipment, as well as attaining prestige and force-multipliers effects to achieve a form of national status and enhancing the military capabilities of their armed forces.

Economic Research-Ekonomska Istraživanja, 2010

The concept of military expenditures is as old as the first antic civilizations. The military, as the first and only line of defense, has always had a great role in the expenditures of countries. Military expenditures changed through history, as has the very understanding of the armed forces which represented the military might of a country. Through the evolution of society many other priorities have emerged concerning state expenditures, but because of their focus on population defense, upholding peace and protecting the country borders as the first and primary forms of public goods, have the military expenditures kept their steadfastness through the entire human history. The globalized world we live in today has changed all this, especially when speaking about insuring the safety of our country against foreign and domestic threats. The development of technology and the globalization itself have drastically changed the concept of waging war and as a result influenced the very structure and level of military expenditures. The level of technology is one of the best indicators of a countries development, but also of the power of its military force. Naturally, military might is very hard to sustain without equally adequate economical power since a developed economy and a strong industry is exactly what enables the development of defense potentials of a country and it's financing. 1