The Economics of the Military Draft

by | May 5, 2004

Last year, Sen. Fritz Hollings (D-S.C.) and Rep. Charles Rangel (D-N.Y.) introduced bills calling for reinstatement of the military draft. A far more descriptive term for the military draft is government confiscation of labor services, but keeping with the spirit of euphemistic obfuscation, I’ll stick to the term draft. Let’s first ask why a draft […]

Last year, Sen. Fritz Hollings (D-S.C.) and Rep. Charles Rangel (D-N.Y.) introduced bills calling for reinstatement of the military draft. A far more descriptive term for the military draft is government confiscation of labor services, but keeping with the spirit of euphemistic obfuscation, I’ll stick to the term draft. Let’s first ask why a draft would be needed in the first place.

Rest assured that if the military offered a compensation package of, say, $50,000 to $100,000 a year, it could get all the soldiers it wanted. Thus, lesson No. 1 is that whenever there’s a draft, you know that the wage is too low to get a sufficient number of people to voluntarily supply their labor services.

Sen. Hollings said, “One way to avoid a lot more wars is to institute the draft.” That’s a statement that reflects gross economic ignorance. In terms of incentives, it produces the opposite effect. Why? The draft is used because the wage the military offers isn’t high enough to get what’s deemed as a sufficient number of people to volunteer.

Here’s my no-brainer question: Under which scenario is war cheaper for the Defense Department — the volunteer army or the draft? Obviously, it’s the draft since the Defense Department doesn’t have to pay the higher wages to get men to sign up voluntarily. Since the Defense Department has a smaller manpower expense, the draft disguises the true cost of war, and one would expect more, not less, military adventurism.

Waging war requires much more than soldiers. You need tanks, bombs, bullets and aircraft. Have you heard a call to draft $15 million F-15 fighter jets or $4.3 million M1 Abrams Main Battle Tanks? I haven’t. The reason is that the government pays the kind of prices whereby producers voluntarily supply these products. Of course, if the Pentagon were willing to pay McDonnell Douglas only $5 million for an F-15 and General Dynamics only $1 million for a tank, it would have to draft (read: confiscate) jets and tanks.

Does one have a “duty” to defend his country? I say yes. In order to field one soldier, I’m guessing you need hundreds of civilian workers to supply him with boots, food, bullets, tanks, jets, medical equipment and thousands of other items needed in war in addition to soldiers. Thus, if you’re engaged in producing these items, you are participating in the defense of your country.

Being employed producing the hardware for the defense of our country need not be voluntary. The government could send us draft notices ordering us to report for work at General Dynamics’ Texas track-vehicle facility at $400 a month. If the government did this, would you call it a draft or slave labor? Not to worry, the Defense Department offers attractive contracts to firms like McDonnell Douglas and General Dynamics, and they in turn offer attractive wages to employees, and thus, volunteerism gets the right number of workers to make the right number of jets and tanks.

The Defense Department might argue that a draft is needed because it would be too expensive to pay market wages to get the desired number of soldiers. It would be right so far as the military budget is concerned but wrong when it comes to military’s true cost to the nation. The true cost of a soldier in the army is the value of what he could have produced, and society must sacrifice, were he not in the army — what economists call “opportunity cost.” Even if the military paid the soldier nothing, the nation must forgo what the soldier could have produced were he not in the military.

National defense is an important government function; for rational decision-making, we mustn’t permit concealment of its cost through measures like the draft.

Walter Williams (March 31, 1936 – December 1, 2020) was an American economist, commentator, academic, and columnist at Capitalism Magazine. He was the John M. Olin Distinguished Professor of Economics at George Mason University, and a syndicated editorialist for Creator's Syndicate. He is author of Race and Economics: How Much Can Be Blamed on Discrimination?, and numerous other works.

The views expressed above represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine. Capitalism Magazine sometimes publishes articles we disagree with because we think the article provides information, or a contrasting point of view, that may be of value to our readers.

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