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Asia's Free-Riders

The U.S. turn to the East makes sense. But tacitly telling its allies in Asia that it's going to foot the bill for their security is foolish and unsustainable.

BY JUSTIN LOGAN | NOVEMBER 9, 2011

It's on the record. President Barack Obama's administration wants to pivot U.S. foreign policy away from the Middle East and toward East Asia. Secretary of State Hillary Clinton's recent Foreign Policy article exemplified this thinking. "The future of the United States is intimately intertwined with the future of the Asia-Pacific," Clinton wrote, touting Washington's "irreplaceable role in the Pacific."
The desire to focus on the Asia-Pacific is sound, but the administration's policies there are not. The impulse to reassure America's Asian allies that the U.S. commitment to their security is rock solid perversely makes it likely that they will continue to free-ride on America's exertions -- in an era when Washington has less and less money to spend.

Both Robert Gates and Leon Panetta, during their tenures as U.S. defense secretaries, have traveled to Europe to hector allies there for not spending enough on their militaries. This is not a new phenomenon in Europe -- even during the Cold War, America's European partners were only supporting actors in the drama between Washington and Moscow. Since the collapse of the Soviet Union, the disparity has grown worse: Only four of the 27 non-U.S. NATO militaries spend the agreed-upon 2 percent of GDP on defense.

The reason these NATO allies have shirked on their defense commitments is because they are smart. They know that if they fail to provide for their own defense, Uncle Sam will do it for them. This has allowed the Europeans to spend their resources on a variety of goods other than defense, from expansive welfare states to impressive infrastructure programs. U.S. taxpayers -- and now their creditors -- are left footing the bill for Europe's defense.

As far back as the 1960s, U.S. policymakers puzzled over the low levels of defense spending among the European members of NATO. In a 1966 article, economists Mancur Olson Jr. and Richard Zeckhauser showed that in the provision of collective goods (like security) in organizations (like alliances), the largest members will tend to bear a "disproportionately large share of the common burden." When a group declares something a common interest, it is rational for the poorer members to shirk and allow the wealthier members to carry a disproportionate portion of the load.
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Sources: Foreign Policy
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