Americans have long accepted the need to invest a substantial part of our national income on defense to keep our country safe, but we have not been safe against a pandemic. Even with a vast national security budget, we have been neglecting public health investments that could have made our nation much more secure against the risks of a new contagious disease like the coronavirus. The devastating cost of this year’s pandemic should warn us against identifying national security only with military security. We need a broader definition of national security, if America is to be better prepared for the next non-military challenge.
In the broadest sense, national security spending should include any public investments that can reduce the likelihood and potential cost of any foreseeable risk that involves a possibility of devastating damage to our nation. Even when the probability of a catastrophic risk is low, it may be worth spending money to make it even lower.
Against the risk of pandemic disease, America could have invested in a reserve manufacturing capability for emergency production of personal protective equipment and medical test kits, which would have been at least as valuable for our national security this year as any missiles or warships. The next deadly pathogen could appear in a poor country, and then Americans would be safer if we had a large mobile medical reserve corps ready to deploy and help contain the initial outbreak. From this perspective, an American withdrawal from the World Health Organization seems a step in the wrong direction.
We should also consider national investments to reduce our vulnerability to the risks of increasingly catastrophic damage from storms and wildfires. Those who are skeptical about the risks of climate change may believe that its probability of causing catastrophic damage is relatively small, but even small-probability risks should be taken seriously when a significant part of our nation is at stake.
Even within the scope of 21st century military operations, the effectiveness of our national security spending has been reduced by its focus on purely military capabilities. America’s ability to achieve the goals of military missions in Afghanistan and Iraq was severely limited by inadequate investment in civilian capacity to support post-conflict restoration of order.
Investments to provide security against national catastrophic risks generally require public funding, because the demand for national security cannot be left to private markets. Society would not permit a private investor to extract from millions of people the full value of saving their lives in a national disaster. A competitive market for insurance against national catastrophes would be inhibited by rational doubts about a private firm’s ability to pay huge claims when the whole economy has been devastated.
Standard models of economic growth that ignore such risks have suggested that a policy of minimizing taxes would encourage private investments in economic growth which could increase everybody’s welfare in the long run. But when possibilities of rare catastrophic risks are admitted, we find that reliable long-run growth may actually require substantial taxation for public investments in defensive measures, even though these investments might seem unnecessary and wasteful in most years.
We cannot afford to provide full security against every catastrophic risk that people can imagine, nor should we credit all suppliers’ claims about the effectiveness of the defense systems that they would like to sell. With limited resources, we must prioritize investments that have a real possibility of making serious risks less likely or potentially less damaging. Decisions about public investments in any area of national security should be guided by the best available analysis from independent experts in the area.
Ultimately, our elected political leaders must determine funding priorities in the broad national security budget, and so we need national leaders who will make effective use of all available expertise for these vital decisions. After all the bitter losses that people have suffered in this pandemic year, we should recognize the paramount importance of electing leaders who can be trusted to thoughtfully and prudently assess how our nation should invest in keeping us safe against the complex risks of the world, not just against military threats.
Roger Myerson is a Nobel Laureate in economics and the David Pearson distinguished professor of global conflict studies at the Harris School of Public Policy and Economics Department with the University of Chicago.
