Defense Spending Cuts Would Not Cover Medicare for All

Trump signs the 2018 National Defense Authorization. DOD photo by Stephanie Chasez.

A recent article in the New York Times by Lindsay Koshgarian claims that defense spending cuts could pay for Medicare for All. I have two issues with this claim: first of all, it is simply untrue, and second of all, the author does not fully explore the radical foreign policy implications of what they are suggesting. This article is not intended as an attack on Medicare for All (which I support). Rather, Americans must understand the fiscal implications of Medicare for All and not be misled regarding its implementation.

The way Koshgarian discusses Medicare for All is confusing and misleading; only by scrutinizing her exact words can we grasp what is going on here. She writes:

All these ambitious policies [Medicare for All, Green New Deal, etc] of course will come with a hefty price tag. Proposals to fund Medicare for All have focused on raising taxes. But what if we could imagine another way entirely?

Over 18 years, the United States has spent $4.9 trillion on wars, with only more intractable violence in the Middle East and beyond to show for it. That’s nearly the $300 billion per year over the current system that is estimated to cover Medicare for All (though estimates vary).

Source: the New York Times.

In the first paragraph, Koshgarian says there is “another way entirely” to implement Medicare for All, one that does not rely on raising taxes. Based on this paragraph, one would expect her subsequent military spending cut proposal to entirely cover the cost of Medicare for All. If it did not, taxes would still need to be raised, and military spending cuts would not be “another way entirely.” There is no other way to interpret this paragraph. Koshgarian is claiming that her defense cuts would fully cover the cost of Medicare for All without a need to raise taxes.

Herein lies the problem: this is simply false. Let us focus on the second paragraph quoted above, which seems to imply that $300 billion per year is the cost of Medicare for All. The wording of this sentence, whether intentional or not, is extremely misleading. The study she cites does have a $300 billion dollar figure: this is the increased system-wide cost Medicare for All would incur by providing coverage to the uninsured and underinsured. It is not the overall cost of Medicare for All. The actual projected cost of Medicare for All is provided one line below and is about $3.5 trillion dollars per year. Koshgarian does some rhetorical gymnastics here; she acknowledges that $300 billion is an increase over current system-wide costs but fails to mention that, under Medicare for All, virtually all existing insured expenditures would come from government revenue; this is trillions of dollars. Obviously, Koshgarian’s $300 billion defense spending reduction would not pay for this. Thus, the dichotomy she presents between cutting military spending and raising taxes is simply false. Moreover, the article misleads readers regarding the relative magnitude of defense spending and healthcare spending.

Oddly enough, Koshgarian references an article, also by the New York Times, which provides multiple estimates of Medicare for All’s cost: all are over $2.5 trillion.

So, Koshgarian’s implication that defense cuts could replace Medicare for All tax increases is highly misleading at best. But, you may be wondering, why not cut $300 billion from the military and put it towards Medicare for All anyways?

We could cut $300 dollars from the military budget, but the foreign policy implications would be monumental, far moreso than Koshgarian lets on.

At issue here is a common talking point: that the US military spends more than the next x number of countries combined (x varies depending on the year one’s data is from, how defense spending is calculated, etc.). Proponents of massive defense cuts often raise this point, with the implication that huge reductions would be safe, as we would still have the largest military budget.

There is an obvious problem with this argument: China and Russia get far more for their dollar than does the US. Even if America were to field a military exactly equal in capabilities to Russia or China, it would need to spend significantly more. This article provides purchasing power parity-adjusted military budgets for the US vs. Russia and China; the math here is rough, as military goods are not the type of thing normally considered in PPP calculations. Nonetheless, it gives a rough illustration of my point. I’d estimate that the Chinese military budget (around $225 billion at market exchange rates) actually equates to at least $350 billion worth of purchasing power vis a vis the US military.

The massive differences in labor expenditure arise from America’s higher state of economic development and its all-volunteer force, which receives good benefits (especially by global military standards). In contrast, Russia relies extensively on conscripts, which cost almost nothing compared to an American soldier. The Chinese armed forces are largely professional and volunteer, but their personnel are still paid a fraction of their American counterparts. The same goes for materials, the wages of engineers and defense industry workers, etc. So, if the US were to actually reduce spending to Chinese USD levels, the result would be a US military significantly weaker than the PLA. This is true even more so regarding Russia.

Nonetheless, even when making PPP adjustments, the US military budget is larger than Russia and China combined. Why is this?

Basically, the US military is asked to do things no other military has to do. Take, for example, aircraft carriers; countries such as Russia or China have one or two mid-size carriers, whereas the United States has 10 state-of-the-art nuclear carriers. The Russian Air Force has around 19 Il-78 tanker aircraft, and China has even fewer. The US Air Force has close to 450. These disparities reflect the difference in role between the US military and other major powers: our armed forces are designed to support allies in faraway places. If North Korea attacks South Korea, China invades Taiwan, or Russian tanks roll into the Baltic, assets like refueling aircraft, sealift ships, aircraft carriers, and surface warships would be essential to beating back the attack and getting American forces to the front lines. Moreover, the mere presence of American assets near likely conflict zones discourages potential aggressors from military adventurism. All of these capabilities are extremely expensive, and Koshgarian acknowledges they would need to be cut for the $300 billion reduction. Asking our partners to spend more is important, but states like Estonia will never be able to defend themselves even if they spend 50% of GDP on their military. Realizing the $300 billion cut in defense spending would be, in effect, to abandon these allies.

Another issue: Koshgarian advocates a massive cut to nuclear arms spending under the assumption the US could reach complete nuclear disarmament. This is an admirable goal, and, unlike some others, I do think a nuclear-free world is something to strive for. However, we are nowhere close to achieving full disarmament; in fact, the proliferation of nuclear weapons is increasing. And successive US failures to stop North Korea’s nuclear weapons program demonstrate that nuclear disarmament is not coming anytime soon. If the US were to unilaterally dispose of its nukes, the results could (and almost certainly would) be catastrophic: any nuclear-armed state could start wars at will and use devastating nuclear strikes to gain leverage or obliterate their adversary’s industrial capacity. Having no nuclear weapons of its own and a crippled military thanks to $300 billion in cuts, the US would have no way to respond.

To conclude, this article is not intended as a critique of Medicare for All but a reality check on what implementation will require. A $300 billion dollar cut to defense spending would not cover Medicare for All, as Koshgarian claims, and such a reduction would leave America bereft of nuclear weapons and unable to defend its allies. To be clear, I do not believe that the military is perfect at budgeting nor that current expenditures should go unscrutinized. The military budget can surely be streamlined and allies could be asked to shoulder a larger portion of the burden, but this will not yield anywhere close to $300 billion. Simple structural factors account for high American defense spending relative to major adversaries, and not much can be done to rectify them aside from abandoning alliances and overseas commitments.

This is a defense site, but I am going to venture into punditry anyways. Medicare for All advocates should stop evading and simply lay out their calculus: your taxes will go up, but we predict that you (and the economy) will save money on healthcare in the long run. Let Americans judge this argument on its merits rather than pretending that cuts to discretionary spending could provide the massive amount of cash needed to implement Medicare for All.

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