As the United States slowly faces up to the fact that it's spending way beyond its means, both sides are shouting back and forth about what the problem is.

Here's what the problem is:

The problem is that our entitlement spending is out of control.

But folks who benefit from our out-of-control entitlement spending cast lots of votes, so neither side has the balls to admit that.

Instead, both sides grab on to their favorite "discretionary" spending pet peeves and scream that we need to start cutting such spending immediately.

One favorite budget line item that Democrats love to scream about, for example, is defense spending. The war-loving Republicans' commitment to a huge military, this story goes, is bankrupting the country.

But is that true?

No, it isn't.

We certainly spend way more on defense than we can afford to, and if we are ever to get serious about balancing the country's budget, we're almost certainly going to have to cut back on defense spending.

But our defense spending actually isn't way out of line relative to the amount we've spent on it in the past (as a percentage of GDP). And it's actually not out of line when you look at "troops per capita" and other measures that take into account the relatively big size of this country.

How do we know this? By reading Kleiner Perkins' partner Mary Meeker's excellent analysis of the financial condition of the United States.

One section of the analysis is devoted to defense spending.

First, the big picture. The pie on the left is what the US government took in last year. The pie on the right is what it spent. "Defense spending," green, is a big slice of the "expense" pie, but it's tiny relative to "Entitlements" spending.

Defense spending has grown as a percentage of GDP over the last 200 years, but the reason we're bankrupt is all the other spending we've added in the past century.

Sure, our recent wars have pumped up defense spending. Wars cost a lot. (But at least we're now including them in the budget, which we didn't in the last administration).

Source: http://feedproxy.google.com/~r/typepad/alleyinsider/silicon_alley_insider/~3/JJiIpmaCMjk/defense-spending-2011-3

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