Ron Paul says U.S. spends $1 trillion on foreign policy

Republican National Committee Chairman Michael Steele sparked a political frenzy recently when he alleged that President Obama is responsible for the war in Afghanistan and questioned the prospects of a U.S. victory in the region.

"Keep in mind again, federal candidates, this was a war of Obama's choosing. This was not something that the United States had actively prosecuted or wanted to engage in, but it was the president who was trying to be cute by half by building a script demonizing Iraq, while saying the battle really should be in Afghanistan. Well, if he is such a student of history, has he not understood that you know that's the one thing you don't do, is engage in a land war in Afghanistan?" said Steele.

The comments prompted several calls for Steele's resignation among Republicans and conservative pundits.

Steele does, however, have at least one defender: Ron Paul, an outspoken Republican representative from Texas and a former presidential candidate. Asked about the comments in a July 5, 2010, CNN interview, Paul talked about what he sees as widespread public disapproval of the war, including its detrimental financial impact on the U.S. "We're spending $1 trillion a year on our foreign policy," Paul commented.

That caught our attention, so we decided to look into it.

Paul's office sent us an article written by Robert Higgs, a scholar at The Independent Institute, a libertarian-leaning economic research organization.

Higgs argues that looking at how much money goes to the Department of Defense is insufficient. One also has to include the appropriations for the Department of Energy's nuclear weapons program, the Department of State, the Department of Veterans affairs, and the interest payments attributable to past debt-financed defense spending, among other expenses. Crunching the numbers for 2009, Higgs came up with a total that's slightly over $1 trillion.

We consulted numerous defense budget experts on the issue. They all agreed that it depends largely on how one defines "foreign policy." Changing the definition means changing the programs that one includes in the calculation, which impacts the total amount.

Winslow Wheeler from the Center for Defense Information sent us a table which details the "U.S. security" expenses for 2010. The total comes out to $1021.3 billion, slightly over $1 trillion. The calculation includes the interest on the Department of Defense Retiree Health Care Fund and on debt-financed defense spending.

Cindy Williams, a principal research scientist at the MIT Security Studies Program told us to check out her presentation on historical U.S. defense and foreign affairs spending trends. Looking at projected spending for the year 2010, summing up national defense programs, homeland security programs, and international affairs initiatives totals $841 billion. Add in the VA budget of $125 billion and we get $966 billion. Williams said that she wouldn't include the interest payments attributable to past debt-financed defense spending in her own analysis, "since there is no good way to judge whether debt accumulated because we spent too much on security, or because we raised too little in taxes."

We also checked with Stephen Donahoe from the Friends Committee on National Legislation, an anti-war lobby. Donahoe told us that their own calculations do not include the entire State Department budget. Still, taking into account Pentagon spending and money that goes into nuclear defense programs, Veterans Affairs, interest payments on defense-related debt, and other related expenses that are scattered throughout the budget, the group arrives at about $1 trillion. The committee acknowledges on its website that the number varies across groups that track defense spending.

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Finally, the folks at the Committee for a Responsible Federal Budget crunched the numbers for us. They came up with a total of $935 billion for the year 2010 and $950 billion for 2011 based on estimates by the Congressional Budget Office. Those totals include the Department of Defense, overseas contingency operations, the State Department and other international programs, and "a few other agencies and programs typically included in a 'security' budget."

Ron Paul claims that the U.S. spends $1 trillion a year on foreign policy. Our experts acknowledged that the figure largely depends on one's definition of "foreign policy." Changing the definition means altering the expenses that one includes in the calculation. There was disagreement, for example, on whether to include the interest payments on debt-financed military spending and how to calculate that debt.