Rupert Cornwell: Out of America

Whoever wins the presidency will most likely fail to take on the unholy trinity of arms manufacturers, the Pentagon, and Congress

That, of course, is precisely what George W Bush would like you to think of his "war on terror", even though the closest the average citizen here ever gets to it is a security line at an airport. But those commercials are part of another struggle, less violent but no less relentless. It is being fought out by companies like Lockheed over the lucrative and effectively captive US government arms market.

Obscured by the great Obama-Hillary battle and the drama of Super Tuesday, the final budget of the Bush era was published last week. It covers the 2009 financial year, and contains one startling fact. If this President has his way, the US will next year be spending more on its military (adjusted for inflation) than at any time since the Second World War.

The raw figures are mind-boggling. The official Pentagon budget for 2009 runs to $515bn (£265bn), or around 4 per cent of America's total economy (the equivalent figure for Britain is 2.5 per cent), and about the same size as the entire output of the Netherlands. Throw in an expected $150bn of supplementary outlays and you've got defence spending larger than Australia's entire gross domestic product.

Even that may be an understatement. Add in various "black items", such as military spending tucked away in other parts of government, and some claim that America's total annual spending on the military now exceeds a trillion dollars – roughly half the entire British economy.

Students of these matters claim that the wind-down of the surge in Iraq, and the likelihood that the Democrats will recapture the White House in December, mean that the latest growth cycle in Pentagon spending, that began at the end of the Clinton era, has probably peaked. But don't bet on it.

A faltering economy may be the biggest worry for voters this election year, but national security runs it close. On Thursday, Mitt Romney justified his decision to drop out of the Republican race for the White House by his party's need to set aside divisive internal squabbling "at this time of war". As for John McCain, the man now set to carry the Republican standard in November, maintaining the strength of the US military is his top priority. The economy, he freely admits, is not his strong suit. National security, however, is. If McCain wins, it will be because Americans deem him the candidate to keep them safe...[Open in new window]