In his farewell speech, President Eisenhower proudly told the world, “We annually spend on military security more than the net income of all United States corporations.” His statement remains true over 50 years later, and our military budget is currently six times greater than that of our closest competitor, China. Ironically, most of our $16 trillion dollar deficit belongs to China. Anyone hoping that an end to the war on terror will immediately solve the national debt crisis is sure to be disappointed; we will continue paying for the early 21st century's wars for years to come, and the cost will be far greater than any past military conflict.
The specter of the Second World War drove us to create the largest military in history ensuring that we’d be safe in the event of another global conflict. Since then, the U.S. military has intervened in dozens of conflicts around the globe in the name of international peace. Many things have changed since World War II; back then, the U.S. government solicited its citizens instead of borrowing from other nations to fund war efforts. Americans bought $150 billion in war bonds during the 1940s, which paid for nearly half of the war. At the same time, the government raised taxes and brought the top marginal rate to 94 percent. Tax hikes also supported the conflicts in Vietnam and Korea.
Conversely, the wars in Afghanistan and Iraq began when taxes were at a historical low point, which is why we’ve been fighting on borrowed dimes. Before we even think about putting a dent in our debt, we have to support our veterans. Military personnel rightly receive the best health care available, and we spent an average of $150 million per day on veterans in 2012. The government is obliged to cover medical costs for all retired veterans, and the number of veterans is about the drastically increase, so the final bill for the war in Afghanistan won’t arrive until near the end of the current century.
While we remain trillions of dollars in debt, the good news is that we already have the tanks, guns and aircraft for which we borrowed the loans, so don’t worry about China trying to collect their payments by force anytime soon.