NARRATOR: America spends roughly $265 billion annually on its military. What drives policymakers to propose increases in the defense budget? What are the potential threats that justify the current level of military spending? Has America's military adjusted to deal with the realities of the post-Cold War? Do policymakers misread the public's attitude toward defense spending?

ADM. JOHN SHANAHAN (USN, Ret.): I'm Vice Admiral Jack Shanahan, Director of the Center for Defense Information.

Current thinking on military spending has really changed little since the demise of the Soviet Union. The United States continues to fund military spending at near-Cold War levels and the military strategy of the United States has yet to reflect the challenges of the post-Cold War era.

Americans are very clear that they want to have a strong defense, but by and large the public lacks information about what that entails. Our program today attempts to demystify the Pentagon's budget with a look at how much we spend on the military, how much our potential adversaries spend, and the reasons why we continue to fund the military as we do.

NARRATOR: Current thinking in Washington on US military spending is largely shaped by an elite policymaking community, which includes the president and the executive branch, the Pentagon, Congress, policy analysts and, of course, the media. Since the end of the Cold War, America's policymakers have debated about the proper role of US military forces in the world and the appropriate level of US military spending.

Budgetary pressures have amplified the call for defense cuts, but the Clinton administration has said defense spending is "off the table," while the Republican Congress has pushed for actual increases in military spending.

Meanwhile, the American public has been largely a silent partner in this debate.

ADM INTERVIEWER: In general, do you think about military spending as an issue? Is it something you think about?

MAN-on-the-Street: No, not on a daily basis.

MAN-on-the-Street: Occasionally, I will glance at an article in the newspaper or something that may have to do something with military spending, but that's not an issue that affects me.

WOMAN-on-the-Street: On occasion, when there are things going on in the world, then I start thinking about the military, how much they spend.

NARRATOR: With the American public disengaged from the military spending debate, does current thinking on defense spending accurately reflect the attitudes of the nation at large?

DR. STEVEN KULL: What we were trying to do was find out whether American policymakers have a correct perception of the attitudes in the American public. And what we found is that there is a significant gap between what policymakers think the public feels and what the American public actually feels.

NARRATOR: Dr. Steven Kull is co-director of a University of Maryland-sponsored research center, the Program on International Policy Attitudes. He was the lead investigator for a report by the center called The Foreign Policy Gap: How Policymakers Misread the Public.

DR. KULL: Most centrally, we found that the American public is not nearly as isolationist as policymakers assume. There's an assumption that in the wake of the Cold War, there's this feeling of wanting to disengage from the world, to withdraw from the world, to simply turn inward, but we didn't find that in the public itself.

NARRATOR: Central to understanding what Americans think about military spending is how Americans view the role of the United States in the post-Cold War world.

ANDREW KOHUT: There are more gaps in attitudes between the average American and the so-called American opinion leader about foreign policy than there were during the Cold War years.

NARRATOR: Andrew Kohut is director of the Pew Research Center for the People and the Press, which recently released the findings of a survey called America's Place in the World II.

MR. KOHUT: If you ask opinion leaders, they're much more satisfied with what the world looks like than they were four years ago. They feel we're playing a more influential role in the world. They think that the problem spots that they saw four years ago were less apparent now than then.

The public, on the other hand, is largely dissatisfied when they look out on the larger world. They have a different view, a less aggressive view of what America's place in that world -- what America's leadership place in that world should be.

NARRATOR: With the demise of the Soviet Union, America's policymakers, backed by a massive military, have sought a dominant role for the US in world events.

MR. KOHUT: Both groups agree that the United States should not be the single leader of the world. However, the opinion leaders feel that the United States should play a first-among-equals role among the leading nations, more assertive than other leading nations. And the public thinks that we shouldn't play a more influential role than other leading nations, that we should just be one of the leading nations that deals with global problems.

NARRATOR: Today, US policymakers favor reliance on the military as a force for peace in the world. As such, US troops have been sent to the Persian Gulf to deter Saddam Hussein from aggression, to help the starving in Africa, to keep the peace in Bosnia, and to protect US citizens in Liberia.

US troops are being used more to police foreign streets than to crush military adversaries.

ROBERT KAGAN: The fact that we have a world right now where there is one superpower is actually a force for peace in the world. And Americans I think understand that, but sometimes they don't understand the budgetary implications of that.

NARRATOR: Robert Kagan is a senior associate at the Carnegie Endowment for International Peace and a contributing editor with the Weekly Standard.

MR. KAGAN: What people generally don't seem to be paying enough attention to is the fact the United States is not a country like most other countries in the world. We have far-ranging commitments and responsibilities. We are keeping the balance of power and the peace in East Asia, in Europe, in the Middle East, and we need to have the forces to be able to do that.

NARRATOR: While policymakers endorse the use of the US military to maintain peace around the globe, the public seems less interested in America acting as the world's policeman.

ROBERT BOROSAGE: Most Americans want to have the strongest military in the world, and they want the American soldiers to be the best armed in world, and they want them to defend this country. And they are very cautious about defending that commitment to other countries.

NARRATOR: Robert Borosage is the executive director of the Campaign for America's Future, a nonprofit research center in Washington, D.C.

MR. BOROSAGE: Increasingly, our policymakers see us as playing the role of a global policeman, as policing internal civil wars in Bosnia, say, or sustaining a force in Iraq or around Iraq indefinitely, sustaining troops on the border of North Korea on the other side of the globe. And these are all missions, and many more, that policymakers have on their agenda that makes them want to have a much bigger military and to spend a lot more money than perhaps the public were prefer. Certainly, they have a much bigger sense of what the military ought to be doing than the public will support.

DR. KULL: Americans want the US to move away from the role of being dominant world leader, of being the world policeman. And from the point of view of policymakers, that can easily be understood as, 'Well, we want to simply disengage.' But in fact, what Americans are saying is they want to move in the direction of a more cooperative type of engagement, they want to put more emphasis on working multilaterally, on working through the United Nations.

NARRATOR: A key aspect of the debate about America's role in the world is how much the United States should spend on defense.

MR. KOHUT: Four years ago, the opinion leaders overwhelming, about 60 percent, said let's cut back defense spending. We've had cuts over the past four years and the consensus in this survey was let's keep defense spending pretty much where it is. Even though opinion leaders are not concerned about any specific threats, military threats, they felt -- there is a sense that we're at about the right place.

NARRATOR: Currently, the Clinton administration plans to spend $265 billion on the military in 1998, keeping the military budget at near-Cold War averages.

[US military spending 1947-1995 illustrated in chart.]

In Congress, the drive to balance the budget would seem to create pressure to reduce military spending. However, over the past three years, Congress has added $21 billion more to the military budget than the Pentagon requested.

While Congress and the administration have discussed military spending levels, the public has not engaged in the debate.

MR. BOROSAGE: At the end of the Cold War, when the Soviet Union fell apart, there was a large increase in people thinking we ought to spend less on our military. But generally, outside of occasions like that, the public is generally passive. They assume they don't have the expertise of this thing and they assume that Washington, between the Congress and the president, will do a good job.

NARRATOR: Much of the willingness of the public to defer to policymakers on military spending issues has to do with the lack of information.

WOMAN-on-the-Street: I really don't have an informed opinion on how much we should be spending on the military.

ADM INTERVIEWER: And why do you think you don't have an informed opinion? Is there enough attention paid to military spending, do you think? Do we know what's going on?

WOMAN-on-the-Street: Probably if we want to, we do, but I don't know enough.

ADM INTERVIEWER: So, if I told you that our government currently spends roughly $265 billion per year on the military, would you think that that number sounds high, or maybe about right, or maybe too low?

MAN-on-the-Street: Well, I think it's about right. Not too high, but it's about right. And like I say, we need the military.

DR. KULL: They're relatively sanguine about the situation, but that's based on some lack of information about what the real level of spending is and also lack of information about how much our potential enemies are spending, and also lack of information about the current criterion, the current standards that are being applied to US defense capabilities.

NARRATOR: A lack of access to information about defense spending may contribute to the perception that the American public is comfortable with current levels of military spending.

DR. KULL: But when it comes to multilateralism, when it comes to spending relative to potential enemies, when it comes to spending relative to other items in the budget, then it becomes clear that the orientation of the public is really quite different than the orientation of our current policies.

NARRATOR: Most Americans are not aware of the magnitude of US defense spending.

ADM INTERVIEWER: Do you have any idea what the military budget is?

MAN-on-the-Street: Big.

MAN-on-the-Street: No idea.

MAN-on-the-Street: No. I don't have no idea how much they spend or what they should spend, no.

MAN-on-the-Street: That's a very good question. I think it's about $300 billion or something like that. There was a time I would have known that figure very easily, but I think it's about that or maybe less than that, I'm not sure.

NARRATOR: A quick look at the top ten military spenders reveals that the United States far outspends the rest of the world. Most of the countries in the top ten are, in fact, US allies.

Worldwide military spending has steadily declined from a high of $1.3 trillion in 1987 to $840 billion today.

Currently, the $265 billion US military budget is a staggering one-third of the worldwide total, and it is going up. The Pentagon plans to steadily increase military spending through the year 2002.

[US military spending, 1997-2002, illustrated.]

But what are the threats to US security that justify increased military spending?

Policymakers often point to the so-called "rogue states," such as Iran, Iraq, North Korea, Libya, Syria and Cuba, as potential adversaries. However, when compared to the military budgets of potential adversaries, US military spending dwarfs the spending of all of them combined.

[US military spending vs. potential adversaries chart.]

MR. BOROSAGE: The rogue nations, the ones the Pentagon points to as supposed threats -- Iran, Iraq, Cuba, North Korea -- collectively spend about $15 billion on their military each year. We spend over $250 billion. None of them have a weapon -- except perhaps Cuba -- have a weapon that can even reach our shores. So, there is no threat that justifies this military spending if your concern is the defense of the United States.

DR. KULL: If the question is phrased in terms of, "How much do you want to spend relative to the spending of our potential enemies?" the majority of Americans say that they want to spend only as much as all our potential enemies combined or as much as the strongest one. Only a very small portion, less than 10 percent, say that they want to spend twice as much as all of our enemies, potential enemies combined, when, in fact, that is what we're currently spending. So, here again, the factor of information is quite critical.

NARRATOR: Another area where the public differs from policymakers on military spending is the Pentagon's post-Cold War strategy. For decades, the United States positioned large numbers of troops in Europe and Asia to contain the spread of communism. Today, the threat of the Soviet war machine is gone, yet US troops remain stationed abroad at their Cold War era outposts.

For instance, the United States keeps 100,000 troops in Europe and another 100,000 in Asia as part of the Pentagon's two-war strategy. This strategy calls for the United States to be prepared to wage two large-scale wars at the same time.

MR. KOHUT: A majority of our opinion leading groups, especially the security experts, favor a policy of having sufficient military preparedness to fight two regional wars at one time.

NARRATOR: While many policymakers favor the two-war strategy, the public thinks differently.

DR. KULL: The public feels that we should have the capability to protect ourselves, of course, and to protect other countries, but the emphasis is that we should have that capability as part of a multilateral effort. That's how much we should spend, that's how much capability we should have, and that's also how we should do it. That we should not make those commitments to do that unilaterally. And this is an important difference here again between the orientation in the policymaking community and the public.

NARRATOR: Another difference is the question of how much we should rely on other countries to play a critical role in fulfilling our defense obligations.

MR. KOHUT: Well, in almost every survey that we've conducted, a multilateral approach has more appeal to both the public and to the opinion-leading groups. The public likes to think that the United States is not out there alone dealing with a problem that affects the West or affects the entire planet. And a sense that the US has partners and that those partners are paying their fair share is an important component of public opinion.

MR. BOROSAGE: Americans want to keep the strongest military in the world and we, of course, have it, by far. One of the problems with that is that, of course, it then allows other countries to be free riders, and we're seeing that increasingly where our allies really don't maintain a fair share of the burden. And there is this, I think, quite generalized phenomenon where countries are happy to allow Americans to carry a lot of the weight.

MR. KAGAN: I think that history has placed us in this position whether we like it or no. Maybe Americans would prefer that somebody else would pick up the mantle of maintaining international peace. I don't think that's what's going to happen if the United States abandons that role. I really do think it is up to us right now.

NARRATOR: But to keep its military commitments abroad, the United States has to make sacrifices at home.

WOMAN-on-the-Street: I think that as the noble American out there, that we expend a lot of energy on an international level to have presence in the world, which is good and kind, but it's remiss in what we need to do for ourselves.

NARRATOR: Under the current balanced budget agreement, Congress cannot increase military spending without cutting domestic programs or raising taxes. And yet, the military budget continues to be kept off the table in budget-balancing efforts by both the president and Congress.

REPORTER (at DoD press conference):

"There are those who say that in the next three years that given balancing the federal budget and the population getting older, that assuming a $250 billion defense budget beyond the year 2000 is simply unrealistic, unless some major event occurs in the world to rally people 'round the flag. How do you answer that?"

WILLIAM COHEN, Secretary of Defense:

"It all depends on what the American people want for this country. If we intend to remain a world superpower, shaping and influencing events that will work to our advantage, then we will maintain a budget that is roughly 3.2 percent of our total overall national domestic product, as such.

"We think that prudence requires us to maintain a level that is about 15 percent of our overall spending in our budget. That that's not too much for the American people to bear for the benefits that we get out of having a stable, relatively peaceful, prosperous world in which we're sharing in that prosperity."

MR. BOROSAGE: Well, of course, we can afford this military budget. That is, it's only about four percent of our gross domestic product, probably a little less than that now, and we could sustain this level if we choose to. But at the same time, we are in a budget context in which all of the pressure is for austerity, for cutbacks, and we've been cutting back domestic investments over the last decade.

ADM INTERVIEWER: Where do you think the government spends your tax dollars?

MAN-on-the-Street: Where? I don't know where.

WOMAN-on-the-Street: I have no idea how my tax dollars are spent. I've always been one that has thought that we should be able to select, like we do on our income tax forms, to be able to check off where we would prefer our money to be spent.

NARRATOR: The money the federal government spends each year is divided into two categories: mandatory spending and discretionary spending. Mandatory spending includes programs that the federal government is required by law to fund, such as Social Security, Medicare, Medicaid, federal retirement pay, and paying off the national debt.

Discretionary spending is the money the president and Congress allocate and spend each year for education, law enforcement, transportation, and other domestic needs. The military absorbs over 50 percent of this discretionary budget.

ADM INTERVIEWER: If someone were to ask you, do you have an idea on roughly how large or small the military budget is, would you be able to throw out a number randomly?

MAN-on-the-Street: No, not at all.

ADM INTERVIEWER: What if I told you they spend $265 billion per year? Would you think that that figure sounds really high or would you say that figure sounds about right, or what impressions does that give you?

MAN-on-the-Street: I would have to have something to compare it to, compared to like what we were spending on other things in order to like kind of be able to compare the two. But 265, I mean, that's a lot of money, but, I mean, it just depends on what you're comparing it to.

DR. KULL: When Americans are asked, "How do you feel about the current level of defense spending? Are we spending too little, too much, or about right?" they tend to center around we're spending about right. And yet, that attitude seems to be based on some misunderstanding about how much the US is actually spending.

Because when we present it to them, a breakout of the current budget, and they could see how defense spending related to other elements of the budget and then asked them how they wanted that balance to be, they cut defense spending very deeply. On average, they cut it 42 percent.

ADM INTERVIEWER: Where do you think your tax dollars should be spend?

MAN-on-the-Street: They should be spent through the public wisely. I would say to help out more on health care.

WOMAN-on-the-Street: I would like to see more money spent on education and on solving our problems with poverty. I think it's a scandal for the richest country in the world to have people living on the streets.

MAN-on-the-Street: I think I'd rather see that money in the people's pockets. I don't think we should be giving as much to the government actually.

MR. BOROSAGE: I think what you're seeing now over the last decade since the Cold War ended and the Soviet Union fell apart was that there was an enormous historic opportunity to change priorities and to put significant resources into rebuilding this society, which had not happened over the 40 years of the Cold War, and that opportunity was lost.

ADM INTERVIEWER: Since the end of the Cold War, do you think the world is more or less stable?

MAN-on-the-Street: Definitely more stable.

ADM INTERVIEWER: And does that influence your thinking about international issues?

MAN-on-the-Street: Yes. I think since the end of the Cold War, that we really shouldn't need to be spending so much on defense. I mean, we should have a ready military force, but not as much as say when the Cold War was going on.

NARRATOR: Given planned increases, military spending will exceed non-military spending in the coming years through the year 2002.

MR. BOROSAGE: Well, if we sustain this course -- and the projections are we will sustain military spending at about this level -- I think over the next decade, you will see more and more our economy paying the price for having schools that are not top-notch, for having sewer systems that don't work, for having roads and bridges that are inefficient, for not doing the research and development that keeps us ahead of the curve economically.

ADM INTERVIEWER: Are you more concerned with domestic or with international issues, overall?

WOMAN-on-the-Street: I am probably more concerned with domestic issues. I think we end up spending too much money abroad and helping out other countries. Meanwhile, here in Washington, D.C., for example, I pass homeless people every day. So, I think we need to take care of us first and the rest of the world later.

DR. KULL: Well, Americans are more concerned about domestic affairs, in general, than they are external affairs or foreign affairs. They're concerned about the economy, or they're concerned about jobs, or they're concerned about crime, or they're concerned about education. Those are more salient to their mind than any kind of external threat.

At the same time though, they do see that the American economy is growing more interdependent with the world economy, so that they see that it's in the US interest to contribute to efforts to maintain world stability.

ADM INTERVIEWER: Would you say that the world is more or less stable since the end of the Cold War?

WOMAN-on-the-Street: Oh, I'd say the world's more stable. I mean, the US is now very clearly the world's superpower and everyone looks to us to watch over their country. Right or wrong, that's the way it is.

NARRATOR: A majority of Americans do not want to disengage from the world, but they do want engagement to have a different emphasis than in the past.

DR. KULL: There's the feeling right now that the US is excessively playing the role of dominant world leader and world policeman and there's a desire for the US to move into a role in relation to other countries where it's contributing its fair share to multilateral efforts or it's playing a strong role, but is not playing so much the dominant role.

In some ways, you might say, well, the public isn't necessarily realistic about that because sometimes it's hard bring about that kind of multilateral decisionmaking. But it's still the direction that the public wants to go and they would like to see American defense spending be consistent with the movement in that direction.

NARRATOR: Ultimately, deciding the appropriate level of military spending for the United States ought to be determined through the democratic process and an ongoing dialogue between the public and policymakers.

MR. KOHUT: Well, I think that there's a fair amount of misreading in both directions. I think the public is having a difficult time in the post-Cold War world of figuring out what our place in the world is and what the connections are. Opinion leaders often misunderstand a lack of information for a lack of good judgment. Because when the public gets informed and comes up to speed on an issue, it generally makes some pretty good judgments about what the nation's course should be.

ADM. SHANAHAN: Worldwide military spending has declined from a peak of $1.3 trillion to $840 billion today, the lowest level since 1966. The United States accounts for 268 billion, or 40 percent, of the $840 billion total.

However, contrary to the worldwide trend of declining military budgets, US policymakers plan to increase military spending by the year 2002. The growing consensus among US policymakers is that we should increase military spending and keep the defense budget off the table while trying to balance the federal budget.

It remains to be seen how long the American public will stand by and watch funds for transportation, education, law enforcement and other key elements of our national security reduced in favor of new weapons to fight nonexistent enemies.

For "AMERICA'S DEFENSE MONITOR," I am Jack Shanahan.