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Defense spending and deficit? To put an end to some false good ideas...

Watch out for miracles! - Jordanian desert (credit: Navy)
Beware of mirages! – Jordanian desert (credit: Navy)

(BRUSSELS2) If France has a deficit, it would in some way (also) be due to its significant military spending. Expenditures that it would incur for the common, European good, which it would then be fair to be able to deduct from the deficits. The argument is attractive and is taken up, from time to time, in different circles. This argument is not without foundation, as my colleague Jean Quatremer pointed out, on his blog, which is based on the Franco-German couple to argue. This comparison, however, comes up against a number of questions which it is not negligible to detail..

1st question : peut-on talk about dropping the budgets of France and Germany? No !

In absolute figures, France and Germany are now tied with a budget of around 31 billion euros. Germany is even slightly in the lead in 2013-2014. In relative figures, compared to the wealth of the nation, Germany still lags behind France with 1,1% of GDP compared to 1,5% in France (*). The gap is closing. The comparison therefore remains limited. Comparing France and Germany in terms of Defense would also require taking into account the respective strategies of the two countries. However, these are quite different. The French defense has certain constraints that Germany does not have and does not want (and cannot have!).

First of all, it concerns the nuclear deterrence. Its cost is often difficult to estimate and gives rise to controversy in France. Equipment credits alone represent a little more than 3 billion: 3,5 billion in 2014, 3,6 billion euros in 2015, according to official documents, which should increase to 4,5 billion according to the head of the General Staff of the Armed Forces, at the end of the 2019 period. Or 0,15% of GDP. A figure to which must be added the operating cost (submarines, presence at sea, security, strategic air forces) which is rarely detailed.

Second, one must take into account the overseas presence, in the departments and communities French, or on permanent bases abroad. These overseas forces (sovereignty and presence) require 11.400 soldiers (of the approximately 200.000 in the French army), or approximately 10% of the workforce.

NB: imagine a Germany equipped with nuclear weapons and with 3 permanent bases, I dare not imagine the howls not only in the Bundestag but in France, sometimes from the same people who criticize Germany for being a little “slow” and “weak” in defense.

2nd question: can we claim the high cost of French Opex? No !

It is a reality, the cost of French external operations (OPEX) explodes each year, going from 450 million euros in the initial finance law to between 800 million and more than a billion in certain years. This chronic underestimation is not an absence of forecasting, it is on the contrary a subtle budgetary tactic, making it possible not to initially count all OPEX operations in order to be able to find financing elsewhere if necessary.

Over time, however, the German and French OPEX budgets are quite similar over time. Over 20 years, we arrive at around 17 billion for Germany compared to around 20 billion euros for France.

Certainly, we could estimate that France is carrying out more intense “first entry” or “force” operations (read: The ability to enter first...). It's true ! But very often Germany continues these actions and is long-term. For example, in the Indian Ocean, the German navy has assumed a permanent commitment to Operation EUNAVFOR Atalanta, since the start of the operation, with a minimum of 2 ships throughout the period. Where the French are now present more irregularly. Ditto in Mali, where Germany will take over from the Spanish as framework nation for the EUTM Mali operation. Let us also mention Iraq where Berlin provided a nice package of (very offensive) weapons to the Peshmerga, even if German planes did not participate in the bombings (read: Berlin will deliver substantial military equipment to Iraq).

Starting to distinguish financial expenditure according to the intensity of the commitment or the utility, which will always be more or less subjective of such commitment, seems quite risky from a public finance point of view.

3rd question: can military expenditure be deducted from the deficit? Very delicate!

Distinguishing the “good” expenditures which should be deducted from the calculation of the deficit and the debt from the others seems quite difficult. How would defense spending around the world be deductible and not other external security spending, such as the gendarmerie, maritime police, security at sea (example for Operation Mare Nostrum)? Finally, the debate will be very risky: why security spending and not health, development and research spending? The debate risks being endless... I often hear this type of comment. But for me it amounts to wanting to send a fighter plane, heavily weighted with bombs, for a long distance, without a refueling plane along the way. He will have 2 solutions to return safely... drop his bombs anywhere and lose them... or crash, kamikaze style.

4th question: can certain military expenditures be converted into investments? Yes in part.

C'is already done. At least in part! Since last September, the SEC2010 statistical system has already made it possible to count the purchase of armaments or weapons systems as investments and not as expenses, which increases the GDP and automatically reduces the deficit and the debt. But for a relatively modest level.

Only one problem: financial solidarity

There remains a general problem, which has not been resolved, of reinforced financial solidarity between the different European countries to participate in jointly decided operations. Today, anyone who engages in a European operation pays twice, or even three times: once by committing his soldiers, the second by participating in the collective effort, and the third by engaging politically (if there is If there are deaths or a slippage, it is the national leader who will be accountable to his population or his national representation). The idea of ​​greater coverage of expenses has been mentioned but is currently encountering certain reluctance, particularly from Germany. This is where the real problem lies, in my opinion, with “European defense”. Today. And despite François Hollande's outburst a year ago regarding the operation in the Central African Republic, this question has not been resolved at all...

(Nicolas Gros-Verheyde)

(*) figures excluding pensions, excluding gendarmerie, according to NATO statistics, more credible than World Bank figures.

Nicolas Gros Verheyde

Chief editor of the B2 site. Graduated in European law from the University of Paris I Pantheon Sorbonne and listener to the 65th session of the IHEDN (Institut des Hautes Etudes de la Défense Nationale. Journalist since 1989, founded B2 - Bruxelles2 in 2008. EU/NATO correspondent in Brussels for Sud-Ouest (previously West-France and France-Soir).

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