More about Arms Aid

January 14, 1952

As I have pointed out in this column before, the distinction between “economic” aid and “arms” aid to Europe is in practice very questionable. Any money or material we give to a European government for any purpose, however specifically earmarked, can simply release that much of its own funds for other purposes. The only way we could make sure that no such diversion of resources was taking place would be to dictate and supervise every item of that government’s budget—which no one dares to propose.

Here are this fiscal year’s armament expenditures of our aid beneficiaries stated as a percentage of (1) their gross national product, and (2) their total governmental expenditures. Our own record is compared.

Defense Expenditures

The United States, in short, is spending on armament not only more than five times as much absolutely as these other nine nations combined ($47,000,000,000 against a total of $8,600,000,000); but it is spending for more relatively—14 percent of its gross national product compared with an average of less than 7 percent for the nine beneficiaries.

Now many Europeans contend that this is just as it should be. They would impose a sort of international progressive income tax. Prof. James Meade of the London School of Economics advocated this explicitly in the October 1951 issue of Lloyds Bank Review: “The United States, with its higher real income per head, should contribute a higher proportion of its national income to the common defense. Indeed, it is inevitable that the progressive principle should be adopted.

Baldly stated, this is the view that the man or country that works more, saves more, and produces more somehow owes part, if not half, of the difference to the man or country that works less, saves less, and produces less. The London Times has carried the “progressive principle” to even greater lengths. “If it is true, as; seems likely,” it wrote on Dec. 19, “that Britain’s [armament] effort is the maximum that is possible economically, and the United States effort is the maximum that is possible politically—for there can hardly be any economic limits to her capabilities. . . .” In other words, no burden can possibly be too big to lay on our taxpayers.

But the second percentage column of the foregoing table is even more significant than the first. The United States is devoting 68 percent of its total Federal expenditures to armament. (Or 75 percent, if our foreign arms-aid program is included.) This means that only 25 to 32 percent of our total government outlay goes for nondefense items. But the arms-beneficiary countries are spending an average of only 25 percent of their total budgets on defense, which means that they are spending 75 percent on nondefense items. They are robbing their own national defense at the cost of comparative luxuries. It is their nondefense expenditures that are responsible for three-fourths of their economic strains and inflation.

Why must American taxpayers pay $5,200,000,000 for Europe’s defense? Why cannot the Europe’s arms-beneficiary governments reduce their nondefense expenditures from $21,400,000,000 to $16,200,000,000, and themselves add the difference to the modest $8,600,000,000 they are spending for defense? Why, because European politicians prefer to spend money on deficits for nationalized industries, food subsidies, socialized medicine, pensions, and other handouts calculated to snare votes at home, should the American taxpayer be called upon to dig in his pocket for what these politicians refuse to pay for their own nations’ defense?