18 Mar. 2008

What's Fitzgibbon's Game?

It seems like just yesterday that Defence Minister Joel Fitzgibbon was telling the media how wasteful the Howard government had been on defence, and how many billions could be saved by some competent Labor management. Now it sounds like he wants to increase the Defence budget instead:
Many new equipment projects inherited from the coalition were problematic and the cost of sustaining defence capability had been alarmingly underestimated and underfunded, Mr Fitzgibbon told an Australian Strategic Policy Institute forum.

He warned that a defence budget of two per cent of GDP might not be enough.
Err, Kev? Are you guys drinking the Kool Aid? I refer readers to an old speech by Peter Costello:
Now in 2003-04, that $15 billion of expenditure will amount to a little under 2 percent of GDP, around 1.9 percent. There are some people that argued that is still not enough, that we should be spending more than 2 percent of GDP. Let me make the point, and I think it is made very well in this paper, that it is a false analysis to determine Defence expenditure as a proportion of GDP, because there are two variables in any such analysis.

The first is Defence expenditure, the second is the size of your GDP. We could cut Defence spending but increase it as a proportion of GDP by throwing the economy into recession. We could cut Defence expenditure but increase it as a proportion of GDP by throwing the economy into recession. Would Australia have a stronger Defence Force? No.
And let's not keep pretending that our armed forces are the key to national security in the 21st Century. I will refer readers to this quote from the top story at antiwar.com today, No Oil for War by Robert Bryce:
In today’s multi-polar world, economic interests, not military force, predominate. “It used to be that the side with the most guns would win,” says G.I. Wilson, a recently retired Marine Corps colonel, who has written extensively on terrorism and asymmetric warfare and spent 15 months fighting in Iraq. Today, says Wilson, the side “with the most guns goes bankrupt.”

Since World War II, America has held fast to the idea that controlling the oil flow out of the Persian Gulf must be assured at the point of a M-16 rifle. But the cost of that approach has been crippling. As the U.S. military pursues its occupation of Iraq—with the fuel costs approaching $1 billion per week—it’s obvious that the U.S. needs to rethink the assumption that secure energy sources depend on militarism. The emerging theme of the 21st-century energy business is the increasing power of markets. The U.S. can either adapt or continue hurtling down the road to bankruptcy.
Where do WE stand, Kev?

UPDATE: Web Diary has Fitzgibbon's speech.