The 1960s Revisited: Guns vs. Butter Debate

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Back in the 1960s, then-president Lyndon Johnson argued that the United States was capable of funding both expensive social programs like Medicare and Medicaid and fighting a war in Vietnam. It was known as the guns vs. butter debate.

Flash forward 50 years. Today President Obama is fighting for vast social programs like health care reform, while at the same time dealing with both economic stimulus to combat the current recession and waging a war in Afghanistan. As today’s budget deficits reach historic proportions, more and more consideration is being given to one of our nation’s largest expenses: defense.

Example: No help for the long term unemployed

The most recent jobless bill designed to extend employment benefits to 1.3 million long-term unemployed failed to get through the U.S. Senate.

Senators will take it up again next week when they are back from their Fourth of July vacation. The House passed a version of the bill but the Senate is arguing about where the $33.9 billion will come from at a time of record federal deficits.

In today’s red-ink atmosphere, Republican senators, joined by Sen. Ben Nelson (D-Neb.) refused in late June to vote against ending the debate on the jobless bill. Since the Democrats needed 60 votes to proceed, Senate Majority Leader Harry Reid (D-Nev.) said the Senate had to move on to other matters.

Democrats called the Republicans heartless.

At a time when unemployment is near 10 percent, less than 50 percent of those laid off now find jobs in six months, the traditional cutoff of unemployment benefits.

But Senate Minority Leader Mitch McConnell (R-Ky.) countered that “the only thing Democrats are insisting on in this debate is that we add to the debt.” The Republicans said they will vote to extend the benefits if the money is taken from unused stimulus money.

While some legislators point to runaway entitlement programs as the problem behind deficits, others point to growing military spending as the culprit. The $34 billion cost of extending unemployment benefits is only about 4 percent of annual U.S. military spending.

The mother of all military budgets

Last year, the United States spent by far the most on its military of any nation in the world — $661 billion. China, with more than 4 times the U.S. population, was a distant second, spending just $100 billion, or less than a sixth of the U.S. tab. Uncle Sam’s Cold War enemy, the Russians, now dole out less than a tenth of U.S. military spending. The United States continues to fund military facilities throughout the world, including large outposts in Germany even though it has been more than 65 years since the end of World War II.

From a recent report from The Center for Strategic and Budgetary Assessments (CSBA) called The New Guns Versus Butter Debate:

The Department of Defense is the single largest employer in the United States. With a total of 2,250,000 full-time civilian and military personnel (not including part-time members of the Guard and Reserve), DoD personnel make up 51 percent of the total federal government workforce. DoD employs more Americans than Wal-Mart (1,400,000 ) and the US Post Office (599,000 ) combined.

In the weeks ahead Uncle Sam will be sending more troops – and spending money – as the last phase of the surge begins in Afghanistan. The proposed U.S. budget for 2011 has military spending jumping to $708 billion.

Nearly a half century after Lydon Johnson and a Democratic Congress pushed through Medicare and Medicaid, the expenditures for those two programs – which have cost far more than what was first projected — are ballooning. So is Social Security. And the escalating costs are only beginning as more baby boomers retire in the next decade.

While defense is still regarded by many as untouchable, expect to see a return in the months ahead to a 50 year old debate: one that was never resolved.

To read more about the deficit go to another Money Talks News story that details just how much a trillion dollars is. To learn more about the guns vs butter debate, check out this recent story from CNN/Money.

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