This report from Fortune lists the nine countries that continue to have AAA credit ratings after Fitch’s downgrading of U. S. sovereign debt:
Economies with the highest credit rating at S&P Global Ratings, Fitch and Moody’s Investors Service include Germany, Denmark, Netherlands, Sweden, Norway, Switzerland, Luxembourg, Singapore and Australia. Canada is rated AAA by two of the ratings companies.
Rather than producing a table of the military expenditures of those countries, I’ll just ask a question. What would the credit ratings of those countries be if they were spending 2% of their GDP or more on military spending? I’m guessing it would change their entire economies substantially. We spend more than those countries as a percent of GDP, per capita, and in dollars. That influences our whole economy.
I would guess not much. It looks like Singapore is already at 3% and most fo those others are mid 1%. If total govt spending is 40%-50% then you are adding an extra 2% of spending.
Steve
One counter argument. None of those countries have as expensive a foreign policy as to quote the current President “in a contest — not with China per se, but a contest with autocrats, autocratic governments around the world”. And Biden is typical of US Presidents since Roosevelt at least.
I think the evidence is clear that keeping military spending low and even more important staying out of conflicts creates substantial wealth over the long term of decades and centuries. As an example, Switzerland being one of the richest countries in the world, despite being a small, landlocked, and mountainous country, is tightly coupled with its neutrality policy.
I’m not sure the question is asked correctly. A military spend sufficient to defend a country is probably more of a fixed amount than a percent of GDP. I’d suggest those countries might need to spend 10%+ of GDP without a US backstop.
That would change the dynamic from negligible, as Steve suggests, to prohibitive.
Maybe military spending is not the only metric, how about military exports?
Nations such as Taiwan, Saudi , Arabia, Israel, Italy, Germany, France, The UK, and I’m sure the list is long, depending on the US for weapons and weapons systems helps ensure the dollar’s strength.
https://www.statista.com/statistics/267131/market-share-of-the-leadings-exporters-of-conventional-weapons/