The defense "cuts" proposed today by Deputy Secretary Bill Lynn are largely notional, not a major change of course. The targets for the first two years are so small as to be meaningless in a $700 b. budget. As the cuts do not include Overseas Contingency Operations accounts, they leave unaffected the 2/3 of the funding in those accounts that is fungible O&M monies, hence a backfill for any O&M cuts in the base budget. In the out-years the cuts are meaningless, as the budget will vary widely after 2013. And that wide variation is likely to be on the down side, as we leave Iraq and Afghanistan and deficit reduction efforts step in to bring defense budgets down more seriously than the Secretary now contemplates.

At 3:45 today, Secretary Gates formally announced his goals for cost savings from reducing Defense Department overhead (click here for the press release, here for details). By July 30th, the services and defense agencies must submit "specific, actionable, and measurable" proposals for cuts amounting to a total $566 million for Fiscal Year 2012 and $3 billion over 2012-2017. That's less than one percent of a Defense Department base budget (as proposed for FY 2011) that, counting the wars in Afghanistan or Iraq, totals $708 billion.

This decline is different. We may have the "largest economy," but this is less and less relevant today for two reasons. One is that a lot of other "economies" are rising at a rapid rate. More seriously, one cannot use "the economy" as a tool in international relations. Those days are gone. The "economy" we have is not in the hands of anyone, is more integrated into the global market for goods, capitol, and labor than ever. The administration cannot "whip the economy around" so it helps our influence in global terms. The economic tools are simply much more limited, and now in the hands of everyone (and no-one - see the global flow of capital and bids against currency fluctuations for evidence."

And the costs of our military in economic terms are simply not part of the argument. Sure, it is (with Energy, VA, interest costs) something like 7-8% of GDP (not 3-4%), but even that does not shake the economy. But it does shake the deficit, and once we are on a slope of deficit reduction and debt control, defense will come down with the rest. That affects our power position; it needs to be anticipated and planned for, not just allowed to happen.

So our decline is (always) relative.

Post World War II, American presidents going back to Eisenhower have recognized that our national security must stand on a firm economic foundation. They have therefore kept defense under control by holding down defense spending. Even Ronald Reagan recognized this: when his supply side economics did not work as intended in his first term, he reduced defense spending in his second term to help rein in the growing budget deficits. Moreover, when we went to war, as we did in Korea and Vietnam, and defense spending had to increase, Presidents Truman and Johnson raised taxes, cut some social programs, and employed the draft to help keep the budget in balance.

The only president to let defense spending rise significantly during wartime without raising taxes was President George W. Bush. In fact, he did the opposite: he cut taxes. As a result, the almost $5 trillion surplus that he inherited from President Clinton turned into a $5 trillion deficit and made it difficult for the Obama administration to provide sufficient economic stimulus to get us out of the economic catastrophe he inherited.

Obama’s new national security strategy does recognize this connection, as do his military leaders. As Admiral Mullen, the Chairman of the Joint Chiefs of Staff, put it, “Our financial health is directly related to our national security.”

If Obama is to bring our mounting debt under control, he too must rein in defense spending. Although Secretary of Defense Gates has said that the gusher is turned off, the administration is still projecting 2 to 3 percent real growth in the baseline defense budget over the next decade. Since U.S. defense spending in real terms is higher than at any time since World War II, accounts for more than the defense spending of the rest of the world combined, consumes more than half of the discretionary budget, and has been growing in real terms since 1998, this cannot continue. Defense spending can and should be cut if the deficit is to be brought under control.

While some Democrats may be concerned that cutting defense spending could cause political problems, they should read Senator Tom Coburn’s (R-OK) letter to the Bipartisan Deficit Commission. Among other things, the conservative Republican called on the commission to “reduce wasteful, unnecessary, and duplicative defense spending that does nothing to make our nation safe.” They could also read Kori Schake’s (Hoover Institution fellow and foreign policy advisor to the McCain-Palin presidential campaign) article “Stop Spending so Much on Defense,” in Foreign Policy online. In the article Dr. Schake says, “Conservatives need to hearken back to our Eisenhower heritage, and develop a defense leadership that understands military power is fundamentally premised on the solvency of the American government and the vibrancy of the US economy.”

Our long-term fiscal imbalance, which increasingly amounts to a massive intergenerational wealth transfer, is clearly a sign of our decline. But it is a decline that has been a long time coming. (I first wrote about the insolvency of the Social Security system as a college sophomore, 23 years ago.) As such, it is tempting for people to assume that we'll figure our way out of this mess before a complete collapse. Let's call them, at the risk of a double negative, the declinist naysayers. And, even if they are willing to admit to the problem in the abstract, the naysayers can point to the more serious, and urgent, imbalances between pensioners and those who pay the pensions in Europe or Japan and say "At least we aren't them."

That is a pretty shoddy argument, but it seems to be ruling the day. We can talk about the obvious unsustainability of using taxes on current workers to pay benefits for retirees until we're blue in the face. And my second grader can do the math on a system that was designed when workers outnumbered beneficiaries by 16.5 to 1, and in which, by 2030, that ratio will fall to 2 to 1. It simply doesn't add up. (For more on this, much more, see my colleague Jagadeesh Gokhale's latest.)

But this isn't a math problem; this is a political problem. The incentive to kick the can down the road is overwhelming. The pain in attempting to deal with the problem in the here and now is, well, painful. It is hardly surprising, therefore, that members of Congress / Parliament / Bundestag / Diet, etc, have become very good at avoiding the issue altogether. And many of those who have chosen to tackle it are "spending more time with their families."

What does all this mean for the United States's standing as the world superpower? Less than you might think. Our difficulties in two medium-sized countries in SW/Central Asia have done more to puncture the illusion of American power than our political inability to deal with domestic problems. Our fiscal insolvency might convince other countries to play a larger role, if they genuinely feared for their safety. But other countries, especially our allies, are cutting military spending, while Uncle Sam continues to bear the weight of the world on his shoulders. In other words, our ability to maintain our global superpower status isn't driven by our economic problems. But it is strategically stupid.

It is here that I take issue with Ron Marks's contention that we spend less today than during the Cold War. While technically accurate, measuring military spending as a share of GDP is utterly misleading (as I've argued elsewhere.) If the point is to argue that we could spend more, I agree. But the measure doesn't address whether we should do so.

We should think of military spending not as a share of the American economy, but rather relative to the threats we face. In real terms (constant current dollars), we spend today more than when we were facing down a nuclear-armed adversary with a massive army stationed in Eastern Europe and a navy that plied the seven seas from Cam Ranh Bay to Cuba. We spend more than during the height of the Vietnam or Korean Wars. Today, terrorist leaders are hunkered down in safe houses somewhere in, well, somewhere. In other words, what we spend is utterly disconnected from the threats we face, a point that is easily obscured when one focuses on military spending as a share of total output.

We spend so much today not because we are facing down one very scary adversary, but because we are facing down dozens or hundreds of small adversaries that should be confronted by others. After the Cold War ended, our strategy expanded to justify a massive military. Since 9/11, it has expanded further. Our fiscal crisis alone won't force a reevaluation of our grand strategy. It will take sound strategic judgment, and a bit of political courage, to turn things around.

In the cover letter to his just-released National Security Strategy, President Obama acknowledged that it doesn't make sense for any one country to attempt to police the entire planet, irrespective of the costs. Unfortunately, the document fails to outline a mechanism for transferring some of the burdens of global governance to others who benefit from a peaceful and prosperous world order. We should assume, therefore, that the U.S. military will continue to be the go-to force for cleaning up all manner of problems, and that the U.S. taxpayers will be stuck with the bill.

The word "fearful" is not what I feel about the combination of debt, deficits, international borrowings, the graying of the nation (although my hair is getting grayer), the entitlements bulge, and so forth in my original post. My feeling is more of a mixture of frustration and guarded hopefulness with intermittent feelings of cynicism and intellectual resignation at the failures of some in our leadership. I am neither a democrat nor a republican (note the small letters). Both parties have failed us. The combination of the parties has truly failed us because their mostly self-serving (or party-serving) actions are not directed a the national security of this nation. They are mostly arging with each other as the problems mount. The House and Senate are mostly dysfunctional. We deserve better. But, let's remember, we voted them in.

As I think of those who have died, been maimed or are psychologically scarred from the wars my feeling turns to a mixture of frustration and deep sadness. Those young men and women are the biggest costs we have in our national security strategy.

We should never forget that. Never.

The other day I helped place a wreath on the Tomb of the Unknown in Normandy. (I thank the military people who allowed me to join them in this. It was an experience I will not forget.) I felt the weight of all of those losses and it was beyond words.

If we truly and honestly looked at the costs and benefits of our foreign and military policies, the structure of our alliances, and the cognitive disconnect between national security and its costs would we be doing what we are doing? Would we be in the situation we are in now economically? Would we be in such a mess in Afghanistan? Would we be sitting on the powder keg called Iraq? Would we be constantly showing invertebracy on some issues that require serious backbone, especially in the Middle East? We are a great country. Let's behave like one.

We have a powerful economy. Let's nourish it with the proper laws, regulations and incentives, rather than just letting the wolves run the feed lot for the sheep.

Someone on this list mentioned the 1950s and how we grew out of our debts of WW2. Well, things are very different now. We have the entitlements bulge coming aroudn the bend. We do not have a baby boom to pay for our retirees. We have a retiree boom. We are also massively in debt at the public and private levels like never before -- when we add up mortgage, government debt and credit cards.

Ah, yes, the credit card. It was not much in use in the 1950s. Now the average family has over $9,000 in credit card bills outstanding. The government also has been caught into the credit card binge.

We are no longer the thrifty and hard working nation of the past.

We need to regain our old principles of economic wisdom and of wiser and more effective national security policy. We also need to remember that they are very much connected.

It is time to get out the shovels and start digging for a better future on all sides.

It is also time for a lot of pushback on the counter-security economic and foreign policies that we sometimes follow. This is a democracy and it is time it became a more functional one again.

1.) A federal government that cannot control its spending, is irretrievably in debt, and concentrates its borrowing from the coffers of U.S. enemies, China and Saudi Arabia.

2.) A military establishment that is the best and most expensive in the world, but is led by men and women who cannot win a war or even define winning.

3.) A federal government that takes $25-30 billion/yr from citizens and gives it to foreigners, while Americans, some jobless and hungry, watch the industrial/transport infrastructure rot.

4.) A higher education system that has taught three generations of kids that wars can be fought without killing, and that, in any event, America is not really worth defending.

6.) A culture that cries crocodile tears for dead Gulf of Mexico shrimp, but celebrates the use of a "right" that has seen AMA members kill for profit 47-million Americans since 1973.

7.) A federal government that will not lift a finger to control its borders, thereby knowingly endangering national security and surrendering any claim to national sovereignty.

8.) A set of politicians, media, and university professors who wage legal and legislative war against America's dominant faith, but fawn over and appease Judaism and Islam.

9.) A bipartisan political leadership that believes America is adequately defended by a few unmanned drones firing missiles at sporadically available and always uncertain targets.

10.) A governing elite that has ceded to Israel the decision of when America goes to war, putting the lives and fortunes of 300 million citizens in the hands of Torah-toting Israeli theocrats.

11.) A governing elite that has gotten 5,500 of our soldier-children killed and 35,000 wounded or maimed so Mrs. Muhammad can vote, but has still not annihilated our enemies.

12.) Federal governments that have wasted 40 years since the first oil embargo and left the U.S. economy vulnerable to America's oil-producing enemies, Saudi Arabia, Venezuela, etc.

13.) A Congress, Senate, and federal bureaucracy owned by an agent-of-a-foreign-power, AIPAC, that makes sure U.S. taxpayers and their children bleed money and blood for Israel.

14.) Governors who let Washington: act illegally in the states, stop efforts to protect citizens: and mandate school curricula made by an effete, pagan, and libertine federal bureaucracy.

15.) Industrial leaders who seek ever greater profits by routinely sending the best U.S. jobs overseas under the guise of free trade and concern for the Third World.

16.) Corporate chiefs in the oil and arms-making industries who lobby/corrupt the federal legislature to keep their companies in the good graces and on the gravy trains of Arab tyrants.

17.) An environmentalist clique rabid to protect Artic hares and sunny Pacific coastal waters and happy to pay the cost thereof in dead U.S. soldiers and Marines.

18.) Churches of all denominations that prefer pacifism to national security; break the law to aid/hide illegal immigrants; and abandon beliefs to get federal funding for their schools.

19.) The 2008 presidential choice between Barack Obama and John McCain.

20.) Citizens who think there is no duty to posterity and lack the courage, patriotism, and civic virtue to destroy the foregoing realities by taking up arms against a sea of troubles.

Will the economy (jobs) recover enough for us to afford our overseas adventures, industrial disasters, and commitments to free trade? We can only hope. Having been an adolescent in the '50s, a time of endless possibilities, I find it hard to think that America will not recover to its previous prosperity. Nevertheless, this kind of recovery seems unlikely in the long run. We bestrode the world. No more. Now we think, along with our miniscule ally, Israel, that we can ignore world opinion and changing circumstance. We think this whatever the cost. Well, good luck to us.

Our contributors have cut through the particulars of Obama's National Security Strategy to a fundamental question: Is the U.S. economy, the ultimat source of America's global power, in decline? And -- a critical nuance -- is that decline relative or absolute? Relative decline means that we are simply becoming less "dominant" than during the heady years of the post-Cold War "unipolar moment" as our economic growth slows down and other countries, chiefly China, catch up. Absolute decline is decline of the "...and fall" variety, where things in the U.S get measurably worse.

As I read the bloggers, Paul Sullivan is the most clearly fearful of absolute decline, the result of a three-way collision of public debt, private debt, and rising entitlements. Gordon Adams speaks explicitly of an end of US "dominance" and says "the political-economic playing field is leveling" -- the language of relative decline. Michael Bremer seems to straddle both camps, with one breath speaking of "the erosion of American dominance" and with the other of "stranded armies...in remote locations even as the metropole degrades."

In contrast, Ron Marks emphatically rejects the premise of decline in either form, pointing out that the U.S. is still the world's largest economy and that defense expenditures, while staggering in absolute terms, are at historic lows as a share of GDP.

I myself feel compelled to ask: Is our current economic situation, as miserable as it is, any worse than, say, the "stagflation" and oil shocks of the 1970s? Are our current wars, as costly as they are in blood and treasure, anywhere near as damaging to our military institutions or our global prestige as Vietnam? And if the U.S. is doomed to decline, even in purely relative terms, who exactly is doing the catching up? Europe and Japan have their own problems with aging populations, ailing economies, and political sclerosis; China and India are riding the tiger of economic growth and social change so rapid they have left much of their population behind.

The basis for military power is economic power. It is also clear that a runaway budget and trade deficits in a limping economy reflect profligate public policy. To restore our economic base, we must spend less and gather in more revenue. Similarly, we must discipline our appetite for foreign goods and learn to create more exportables. If we don't do this, we will become a demi-hegemon and the world will be a more chaotic and fractious place.

Assuming that we summon the moxie to bite this very big bullet, what in the field of national defense will have to go. One can't tighten the national belt when you are dishing out 700 billion per yr to my bubbas in the Pentagon. Iraq will have to be downsized, and Afghanistan will have to become security assistance-centric, not expeditionary-centric. How long can we continue to spend 80 billion dollars per year on A'stan, a country whose GDP is @ 25 billion dollars per annum?

Dozens of systems must die, starting with the 2d engine for the F35, the USMC's amphibious tractor cadillac, and the carrier version of the F35. Military personnel over time must be returned to pre-9/11 levels. We must do more with drones. We need new tanker a/c. We need cheaper naval vessels. Spending on intelligence and diplomacy/development will have to be held level. We should work harder on security and economic assistance that is oriented on preventing conflict and helping others defend themselves. On other fronts, national commissions must help us to bring entitlements under control. We can continue to be a superpower, but not if our accounts begin to look like Greece's. While we can, we need to cut back and rationalize to build our strength for the future.

[Blog contributor Paul Pillar spoke on this very subject recently at the Nixon Center's annual National Policy Conference. Retired Lt. Gen. David Barno wrote up the conference at Tom Ricks's blog, The Best Defense -- click here for the whole item, but I've reproduced the section sppcifically about Dr. Pillar below:]

Only Paul Pillar truly got at the larger issue of how our growing commitment in Afghanistan fits inside of a changed global strategic context for the United States.

Some of his tough questions:

• Why are we actually in Afghanistan?
• Is the availability of "sanctuary" (in a world of myriad sanctuaries) really important?
• Do the benefits of denying sanctuary in Afghanistan fit into any cost-benefit logic for the U.S.? (vs. benefits of Afghan sanctuary to the terrorists)
• Are we confusing sunk costs with future investment decisions?
• Do we truly understand that successful COIN is a means toward an end -- rather than an end in and of itself?
• And most importantly: Are our actions in Afghanistan and the region reducing the terrorist threat to the U.S.?

Pillar's views stood in stark contrast with the usual suspects of debate: civilian surge adequacy, Karzai's governing capacity, the prevalence of corruption, or the speed of Afghan security force growth. They were a timely reminder that in the all-consuming nature of war, the trees quickly grow to obscure the forest, and that it is important to remind ourselves of first principles. Pillar pulled our lens back from the riveting small picture of the day-to-day fight in Afghanistan to the fuzzier big picture - regional, global, economic as well as military. It was both discomfiting and necessary.

The US has very large debt and deficit problems. Both work into each other. As deficits increase so does the debt. As debt increases the interest payments on the debt also increase. Interest payments are part of the budget of the US government. The deficits of the US have been, well, scary, of late: http://perotcharts.com/category/challenges/budget-deficit/. This is especially so given that the other side of the federal budget equation is not going up as needed for some balance to occur. These are tax and other revenues. Actually, given the recession they have been going down compared to what they would have been otherwise. Here are some charts from the Concord Coalition that show the importance of the deficit compared to sources of revenue and spending: http://www.concordcoalition.org/learn/budget/federal-budget-pie-charts. Well, that is a big ouch, no?

Here is an interesting link to a debt clock that should act as a wake up call: http://www.usdebtclock.org/. This link also gives a sense of the side of the debt issue that is usually separated in the minds of many in leadership and in the public. That is the terrible addition of public and private debts. That is mortgage, corporate, credit card and other private debts added into the ballooning public debt. Both the private sector and the public sector have seen the fees and interest payments on their debts increasing in shocking ways. Part of the solution to the private debt problems we saw recently was for the government to intervene. It intervened, but also took on massive debts in the process. It is still yet to be seen how this will work out.

In Greece, Ireland, Italy, Iceland, Spain, and Portugal this transfer of debt from the private to the public sector has been a real problem. So far it does not seem to be a huge game changer in the US, but we will have to see how the public debt crisis, which replaced the private debt crisis, in the EU will effect the US and world economies over the next few months and even years.

If the US only had to deal with public and private debt as is normally considered then we would have a much easier time of getting ourselves out of this mess via productivity change and economic growth, as well as with a lot of luck. However, we also have an entitlements crunch coming that may prove to be a much more powerful influence on our ability to act freely and effectively toward our national security here and abroad. The really big issue here is the expected entitlement liabilities via Medicare. Social Security and Medicaid are much less of an expected liability burden, but still shocking.

Here are some charts from the famous chart man and former Presidential candidate, Ross Perot on these issues: http://perotcharts.com/category/challenges/medicare-and-medicaid/. Note the interest payments ballooning as we head toward 2050. All this can be turned around with proper policy changes for entitlements and for taxation, but these will not be easily done politically. By the way, given what we will likely face in the future taxes will have to go up --- and a lot. That is unless our leadership and others can get their acts together before the increasingly faster and thicker glacier of debt starts scraping away at the economy and our people.

Here is something you might want to look at from the Concord Coalition’s “Fiscal Wake Up Tour”: http://www.dev.concordcoalition.org/act/fiscal-wake-tour/fiscal-wake-call . After reading this, have any of you woken up?

This situation is worrisome. I have young children and I worry about what kind of future they will have given the fiscal irresponsibility this country has been involved with for a very long time. We need to get real about what we can do and what entitlements we can really take care of in the future.

You might want to look at this PowerPoint chart from the Concord Coalition on “Short and Long Term Budget Trends”: http://www.concordcoalition.org/files/uploaded_for_nodes/WebSiteTalk032010.pdf. If this does not make you more than a bit nervous then please go back to the grill and your beer…and stop biting your nails. Doing something means more than just wondering and worrying. Write your Congressmen and others to get moving on figuring out what to do about this.

Please look at chart #3 in particular. This should be a serious focus of those who are thinking hard about our national security future. Look at how mandatory expenditures are pushing out discretionary expenditures. Mandatory include things like Medicare, Medicaid, Social Security and, of course, those interest payments on debt. As the mandatory expenditures, mostly from entitlements that already have massive liabilities (go back to the debt clock link earlier in the article and start sweating on that one) and on interest payments.

For those of you who don’t know defense and foreign affairs budgets are discretionary expenditures. That means their budgets go from year to year. As the mandatory expenditures squeeze the discretionary our ability to protect the country and to help ensure national security will be at risk. Debt, deficits, entitlements and interest payments are a big part of a national security equation for any nation.

Oh yes, take a look at chart 14 of http://www.concordcoalition.org/files/uploaded_for_nodes/WebSiteTalk032010.pdf . There are less people per retired person than before. Each working person will need to pay more and more into the entitlements pool in order to keep this system in some form of functionality. That adds up to more taxes. We are a graying nation and we had better get used to it and adjust to it.

What is another graying nation? China. With the one child policy all of the massive amounts of money we have been borrowing from China will not be there for long. The children of today need to take care of their parents and others who are aging in the future. Excess Chinese cash will be less available surely. There is an international economic squeeze there as well. The countries in the EU and many countries elsewhere which are also major lenders to us and hold massive amounts of our public debt are also facing entitlements crises. So, we cannot live off this borrowed money so easily much longer. Please see this list of the countries which hold much of our debt and think about their economic, aging and entitlements issues: http://www.ustreas.gov/tic/mfh.txt

Another corollary to all of this: we need to be far more careful on how we spend the national security budgets. We need to be more careful than ever before given the triple squeeze of growing debt, increasing entitlements, and less cash available to borrow from others. Policy makers need to incorporate economic ideas much more so into national security strategies. This entails more than the usual nice rhetoric. It entails actions to fully and seriously consider and start managing better our national security strategies within the limits of our ability to keep paying for them given our other needs.

Now try to listen to Dr. Linda Blimes on the “Three Trillion Dollar War”: http://www.npr.org/templates/story/story.php?storyId=87855957 . Now remember this interview was three years ago and costs continue to mount. Now let’s think of the costs of the war in Afghanistan: http://www.usatoday.com/news/military/2010-05-12-afghan_N.htm. These are now more than the costs in Iraq. Now look at the conservative numbers that just look at contemporary costs of the wars in Iraq and Afghanistan: http://www.cbo.gov/ftpdocs/108xx/doc10871/Chapter1.shtml#1099447 . Now consider the interest costs, the veterans’ benefits and medical costs in the long run and so much more.

Are we awake yet?

One the interesting parts of being a member of the chattering class is to listen to certain lines being flogged over and over again. One is the decline of America and its consequent decline/overexposure on the world stage. Always a good money maker. But, slightly misquoting Mark Twain, the reports of our death are greatly exaggerated.

Ok, let's get some facts on the table before we start talking national security strategy. We are still the largest economy in the world with one of the highest GDP's per head. We have 300 million people who are mostly middle class. Our society is fairly lacking in wholesale political corruption. And no one is touching the dollars in terms of a worldwide currency. GDP devoted to defense is still running about 3-4 percent -- low versus Cold War and certainly to major conflicts like WW II and VIetnam.

On the lousy side, we have a big debt left over from the Bush Administration's refusal to bump up taxes to pay for a war on terror and a very badly timed tax cut. And we are paying for the financial excesses of banking system that got out of control -- here and around the world. Consequently, the economy is still trundling along at a very slow recovery -- though better than our European and Japanese friends.

And, yes, our bogeyman Chinese are still moving ahead with some speed and want a share of the power. Fine, Welcome to the table. Let's play world superpower. They have some economic power. Good, they have earned it. From a political and military standpoint, they are more talk and speculation than reality. And, their military is more interested in making money through their own little industrial projects than invading countries and making blue water navies. They are also not sticking their necks out too far as they have major headaches with a dodgy banking system and a billion citizens who are not middle class and are being financially squeezed. China is Brazil with more people and a few more bucks.

So what about the new National security document -- a lovely statement based on the current snapshot of the world as they always are. We are going to have more soft power and more emphasis on bilateralism. We are going to have a emphasis on fighting to control cyberspace. We are going to battle terrorism world wide. And we are going to talk about extending national security within the Homeland. As I said, a lovely statement of intention. And like most such documents gone with wind the moment something happens.

We are engaged globally because we are a global power. We have political, financial and cultural influences around the world. The war in Iraq is winding down and the one in Afghanistan is muddling along. Our defense against Al-Queda and their fellow travelers in other lands is not that expensive and necessary because our European bretheren would rather spend it on a welfare state they can no longer afford -- one thing the current euro crisis is beginning to drive home.

The bottom line is the United States is the indispensible nation. Whatever document we put our and whatever our temporary financial problems, we will continue to make global commitments for the sake of our interests and others. We are not spending that much of our national treasury on it. And, please chattering classes, find another nation to decline for awhile because this is getting boring.

A gap always exists between the stated words of a strategy paper and the actions of the leaders who promulgate it. The disparities and discrepancies may be relatively minor or monumental. Minor gaps are to be expected. One reason is that the former enunciates principles and presents a mental picture in broad strokes whereas the particular is rooted in hard realities of a given time and circumstance. Sound policy-making nonetheless refers to the more encompassing, more abstract cognitive map for assessing the meaning of the particular, its linkages with other issues and how alternative courses of action relate to the larger design. When that does not occur, the strategy loses cogency and the aggregation of individual policies loses coherence. That is more often the case than not. For concerted behavior over time in accordance with a logically conceived design is prey to the vicissitudes and distractions of a democratic polity. – as well as the limitations of individuals.

A less innocent reason for the ‘gap’ is that it was not taken seriously from the outset. The exercise may have been launched because that is what is expected of new Presidents, especially foreign affairs neophytes. In those cases, the document can be little more than an amalgam of ideas generated in various corners of the foreign policy bureaucracy without much theme or direction. Consequently, it simply is not very helpful as a guide to purposeful action – and it does not lodge very securely in the minds of senior officials.

A variant of this second phenomenon is to affirm an abstract theme or two that offers a measure of verbal continuity while falling short of a producing a strategic framework suited to the demands of the country’s multifaceted and wide-ranging external relations. Here, the motive is to impress on the audience a concept that conforms to the cultivated self-image and public style of the President, e.g. human rights for Jimmy Carter, diplomacy for the current incumbent.

Obama’s security opus is a mix of the innocuous and the self-indulgent. It is not a serious strategic statement – despite the lavish praise bestowed on it by a scion of the Washington foreign policy establishment who declared it a work of statesman-like genius, perhaps not seen since Bismarck. The basis for this critical judgment is three-fold.

First, it is too self-conscious in reiterating lofty ideals that have been staples of Obama’s rhetoric since the campaign. Nothing wrong with that in principle. It is just that he abandoned them in practice from the moment his foot crossed the threshold of the White House. They include, inter alia, transparency, openness, square-dealing and – in the foreign policy realm – cooperation, consultation, coordination, multilateralism and the primacy of diplomacy. To stick to the latter, this administration has followed those precepts only slightly more than did its predecessor, although skilful at creating an impression at variance with behavior – an impression now fading among our erstwhile enthusiastic well wishers abroad.

The NSS boldly declares that the United States must be “sensitive to the strategic objectives of other states” and must “emphasize listening to others.” This is hardly an accurate description of what this administration has been doing for the past sixteen months. The list of governments and groups with whom it refuses to speak grows steadily. It devalues the counsels of partners, and lecturing friend and foe alike is the characteristic mode of communication.

The second reason for discounting the new strategy’s seriousness is its failure to occupy the intellectual middle ground between the abstruse and the concrete. This long document begins with 9/11 and Afghanistan; the ‘war on terror’ looms over everything else. For that is unmistakably designated the paramount security concern of the United States. That is a highly dubious proposition; yet, it is given no more scrutiny in this self-consciously farsighted document than it is in everyday discussions. (One wonders whether Bismarck would have deemed the bin-Laden bunch as more important than managing the consequences for the world system of China’s rise). So the immediate focus is narrow, yet the study covers just about every aspect of American public life and public policy, e.g. education, civics, energy, finances. This is reminiscent of the Cold War days when a similar encompassing perspective was driven by the threat and multiform competition from the Communist world. It was great to have federal money poured into area study programs but today it is hard to see how the shortcomings of American education are related in any way whatsoever to al-Qaeda. Are so-called Charter Schools (the White House’s discredited pet initiative) the imagined instrument for contending with the dangers posed by violent Islamic jihadists? Are charter schools now to be our counter madrassas?

A conscientious security strategy would provide guidance, at the very least, for addressing the deep issues raised by our interventions in Iraq, Afghanistan, Pakistan and elsewhere. They include: is the country prepared to live with any level of terrorist threat from the Greater Middle East? If not, what are the implications?; what place does nation-building in that region have in our omnibus security strategy?; how do we appraise the intangibles of alienating a large swath of the region’s population and losing our moral standing worldwide?; how do our leaders engage the American people in thinking honestly about these questions?

Finally, this broad gauge report is a committee product with all the drawbacks of the genre. It is a consensus document leaning toward the lowest common denominator of agreement and anodyne language. The preliminary materials that went into its composition may or may not have been braver and more incisive The President is unlikely to have read them. I doubt that he will ever reread this composite.

I have taken much space to comment about the report as a whole. As to the critical economic dimension, here are a few thoughts.

1. A grand security strategy is not the best vehicle to address the profound structural problems that bedevil the American economy. There are thin grounds for deferring to those currently responsible for our macro economic policy, especially as regards the parlous financial situation. Yet that is exactly what this report does in limiting itself to bromides and vague exhortation. From a security perspective, there is much more to be said.

2. America’s exalted sense of self is rooted in the belief that we are pace-setters and world beaters in every domain. Yet the great financial crisis that continues to menace us was an American product in every respect. Its underlying philosophy, its dubious innovations, its practices – all bear the mark MADE IN USA. We have lost a good amount of authority as a consequence. Moreover, we find ourselves in the impossible position of either stifling that uncomfortable truth in order to sustain national mythology, and sense of prowess, or we have to admit that we are not as exceptional as we think.

3. The erosion of American dominance, and thereby influence, is occurring more rapidly and cutting more deeply in the economic sphere than in the political or, certainly, military realms. That already is beginning to register in the manifestly greater independence of mind shown by other states - even as we flex our military muscles in obscure places and devise plans to extend the field of action. If we continue in this manner, we will be left with stranded armies physically able to do almost anything in remote locations even as the metropole degrades.

4. Spending a few trillion dollars in the futile attempt to obliterate totally and forevermore the ‘terrorist’ threat accelerates that process.`

Our economic and fiscal weaknesses have significant indirect and direct consequences for our national security position and international leadership. They reflect a changing position of the US in the global economy and are ushering in an era very unlike the dominance the US had in the global economy or in the international system during the Cold War years.

The most immediate source of the problem is our unprecedentedly high deficits and debt. The latter is forecast to reach 80-100% of our Gross Domestic Product by the end of the coming decade. As the report from the Peterson-Pew Commission pointed out last year, yawning deficits and growing debt bring increased risks of inflation, a decline in the value of the dollar, slowing demand for Treasury notes, with higher interest rates, slower economic growth, and flat or declining wages.

All of this has an impact on the US global role. In an interdependent global economy, the US becomes more dependent on the “kindness of strangers” for its well-being, the funding of its debt, the value of its currency, even its dominant position as a reserve currency. As the balance in the global economy shifts, the political-economic playing field is leveling. Twenty countries, not eight, are now the forum for resolving global financial and economic dilemmas. US leadership in international economic and financial institutions, such as the IMF, the World Bank will inevitably change into partnership. A new kind of global equality is slowly, and inexorably emerging, to which the US will have to adjust.

The recognition of the long-term consequences of sustained, high deficits and growing debt has led to growing focus on the need for serious deficit reduction efforts, including a Presidential Commission and a private effort led at the Bipartisan Policy Center, led by former OMB Director Alice Rivlin and former Senate Budget Committee Chair Pete Domenici. These deficit reduction and debt stabilization efforts will have a direct impact on the US international position, as well. Efforts to reduce the deficit share one common principle: they only work politically if everything is on the table.

This means the DOD budget - and the force structure and hardware it supports – are going to be on the table, and in short order. DOD is not prepared for, does not acknowledge, and is not planning for, this reality. The reductions to come are much deeper than those acknowledged by Secretary Gates, who aims for growing defense budgets, at a rate one percent above inflation, and seeks to save $10-15 billion a year at defense by trimming around the edges of the number of flag officers, and excessive administrative costs.

The looming decline in the defense budget will be driven not only by deficit reduction, but by a domestic political reality. As the US withdraws from Iraq, and as an Afghanistan withdrawal appears on the near horizon, domestic and congressional support for unprecedentedly high defense budgets will erode.

This reality is not without precedent. The deficit reduction drive, from 1985 to 2002, had to include defense, or it would never have happened. And in 1989, the political underpinning of high defense budgets went away with the fall of the Berlin Wall and the Warsaw Pact. Between 1985 and 1998, defense budgets fell more than 36% in constant dollars. The US active duty force shrank from 2.2 million to 1.4 million; civilian employment fell from 1.04 million to just over 700,000; hundreds of hardware programs, large and small, were terminated. And almost all of that happened under a Republican Secretary of Defense, Dick Cheney.

The economic and political trends will require even more US adjustment than contemplated in the new National Security Strategy (NSS) or in the Quadrennial Defense Review (QDR). We are still to some degree, operating under the illusion that our own actions are enough to restore US dominance and leadership in the international arena. And while the QDR recognizes the importance of partners, the unprioritized set of mission it gives our military forces - fight insurgents, stabilize and rebuild other nations, battle terrorists, secure the “global commons,” ensure regional security, protect the homeland, and knock down the doors of anyone that denies us access – far exceed our military capabilities and would demand defense budgets even larger than the historically unprecedented (since World War II) level they have reached today.

US leadership will never be the same, and budgets will not grow to support such an ambitious set of missions. Our resources will not allow it, and such a role is no longer globally welcome. It is time to end the illusion and rethink our view of ourselves and of our role in the world. The NSS is only the first step in that journey, and still seems to labor under the illusion that a restoration of past dominance is possible. The QDR points in an unreal direction altogether. The Quadrennial Diplomacy and Development Review (QDDR), still under way at State/USAID, may provide other answers and greater detail. But the deficit, debt, and end-of-war realities we face call for a major rethink of the way we intend to engage the world. We are, at best, only part way there.