Tag Archives: China

Where America leads: #1 in military spending and #1 in arms exports

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America has been the predominant military power for the last fifty years.  With the break up of the USSR in the late1980s, the US stands alone in its military spending.  Americans of my Gen-X generation, are now asking the question, “Should America Serve as the World’s Policeman?” and more cynically, “Can We Afford It?”

Clearly, the world is still a violent and messy place.  It is still a realpolitik world where geopolitical power is sadly demonstrated (as Mao so in-eloquently stated ) “from the barrel of a gun”.  There are too many failed economies, unconscionable despots, and tribal conflicts to leave people to their devices.  Unfortunately, we are a far cry from the world envisioned by Woodrow Wilson.  In many ways, the UN plays only a supporting role.

The United States has the highest military expenditures.  The US spends ~ 4.8% of GDP or $700 billion on the military annually.  To put that in perspective:

  • Since there are about 315 million Americans currently, this equates to each of us paying about $2,300 annually in military spending
  • Since there are about 7 billion people in the world, this means Americans pay about $100 annually in military expenditure for each global citizen
  • In the graph from the Economist, you can see that the US military spend is the same as the next 17 countries combined

Military Spenders GraphUnsurprisingly, China has the most soldiers. China has almost 2.3 million soldiers, which is 10x more than the Japanese.  In terms of Naval power (shown in the dark blue bars), the US, China and Russia are the only real contenders.  China recently acquired and retrofitted an aircraft carrier, but the NY Times notes here that it is only for training purposes and actually has no planes that can land on the vessel.  North Korea is also an outlier (as it often is) because it has 49 military personnel for every 1,000 people.  So sad.

Military by Country Graph

Military Industrial Complex.  President Eisenhower saw it coming 50 years ago.  He warned that a Military Industrial Complex would create an environment where the government, armed forces, and private companies share a mutual interest in maintaining a permanent military infrastructure.  Eisenhower said in his 1961 farewell address:

“We must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex.  The potential for the disastrous rise of misplaced power exists, and will persist.   We must never let the weight of this combination endanger our liberties or democratic processes.  We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals so that security and liberty may prosper together.”

Global arms trade is big business.  According to the Stockholm International Peace Research Institute (SIPRI), arms exports have been approximately $20-30 billion annually for the last twenty years, as shown in the graph below.   It hit a low in the 2002-2003 time frame, and now it is at a high.  SIPRI has a lot of country-level data here for download.

Arms Exports Graph

The US and Russia (ex Cold War players) are exporting the most.   Seems like the military industrial complex in both countries still have a lot of arms to sell to the rest of the world.  The US sells a lot to South Korea and Australia, while Russia sells a lot to India and China.  Interestingly, the Greeks buy a lot of arms from the Germans and the French.

Arms Exporters GraphSo, what should role of America’s military be?   In a fascinating debate on the topic of “America Should be the World’s Policeman”, six experts discussed the pros / cons of an activist US foreign policy here.  Some might consider this a politically-charged topic, and it is.  It deserves discussion.  The safety of 1.5+ million American military personnel and $700 billion in annual US military spending hinge on the outcome of the national debate.

PS: Economist article on when China may outspend the US in military spending here.

Olympic Medals Measured by Population, By Productivity, By GDP

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As a consultant, it always seemed odd that news reporters routinely compare the medal count between the USA and China – after all, the USA has 530 athletes compared to China’s 380.  Seems like the total number of medals is only one of many potential metrics.  For example, productivity (i.e., # of athletes needed to win a medal) would be a metric that levels the playing field among countries of different sizes.  Thinking along those lines, I smashed together data of the last 40 years and came up with this:

If you’re from Iceland, there is a good chance you are an Olympic Athlete. . .

Most selective Olympic team

In 2010, there were 319K people in Iceland and yet they sent 27 people to London for the Olympics.  Simple math tells us that they sent 1 athlete for every 11K people.  In fact, it is really easy to be an Icelandic Olympic athlete compared to the Bangladeshi.

I took the country’s 2010 population here and divided it by the number of athletes that each country sent to the London Olympics.   You can see that China sent 1 athlete to the Olympics for every 3.5M citizens.  The US sends 1 athlete for every 580K citizens.  It is easier to go to the Olympics as an American than a Chinese – less selective.

Olympics by Population 1972-2008If you are from Bangladesh, your chances of going to the Olympics as an athlete are slim.  Only 1 in 30 million Bangladeshi go to compete in the Olympics.  As a thought-experiment, if all the teams sent 1 athlete for every 30M people . . .

  • The US Olympic team would only send 10 people (not 580)
  • The total Olympics would only be 233 Athletes (not the 10,700+ it currently is)
  • Only 40 countries (over 30M population) would be competing

The most productive Olympic athletes are from . . . . Panama

Athlete productivity

Why does data surprise us?  Looking at all the medals won in 2008, and then dividing it by the number of athletes sent to Beijing by country, Panama wins the prize for the most productive athletes.   Panama will win 1 medal (over average) for every 3 athletes they send to the Olympics.  It is correlation, not causality – but it is still impressive.

Olympics Medals

  • South Africa won 1 medal in 2008 with 136 athletes
  • Burkina Faso also won 1 medal in 2008, with only 6 athletes

Of all the medals that China wins, more than 50% are gold

Gold as a percentage of medals

In a previous post, I discovered that only 32% of medals are gold (more than 36% are bronze).  When analyzing the medals over the last 40 years, the Chinese have stood out as a strong bunch.  51% of their medals are gold vs. 32% of US medals being gold.

Olympic Gold %

In terms of the GDP per athlete, the Indonesia was the highest

GDP per Athlete flag

Looking at the country-based GDP numbers here, Indonesia has $32B in GDP (2010) for every athlete sent to London 2012.  By comparison, every Tuvalu athlete symbolizes only $10M in GDP output.  Likewise, the US Olympic athlete symbolizes $27B in output compared to $4B represented by the British athlete.

GDP per Athlete

China keeps winning. . .

Looking at the current medal leaders in London, you can see that the United States (in white) has been consistently winning ~ 100 medals every summer Olympics except in the 1980 Olympics where there was a boycott.   The British  (in blue) have done well since 2000, but the Chinese are the stand outs.  They had no Olympic team in 1980, yet they had 100 medals in 2008.

Summer Olympic Medals US China UK

I am a patriotic American.  Huge believer in US constitution, freedom of speech, Chik-Fil-A sandwiches, our top-shelf graduate education system, Pixar movies, micro-brews, Teddy Roosevelt, National parks and NPR.  (Yes, I do wish the Economist was a US paper).  Love watching the women’s soccer (not football) team beat the Japanese, and the women’s volleyball finals US vs. US.  Michael Phelps is impressive too.

That said, we also need to give credit where credit is due.  The Chinese have been rocking the Olympics.  A balanced scored card of the Olympics might look like this.

Scorecard US China UK

China won 100 medals in 2008 summer Olympics which was a 59% increase over 2004.  Each Chinese athlete has a 1 in 3.5 million chance of making the team, but when they get to the Olympics ~ it takes 6.4 athletes to win a medal, and 51% of the time it is gold.

The Olympics are awesome to watch and one of the most democratic sporting events, if you are willing to measure medal counts a little bit differently.  Enjoy the games.  Go USA.

Note: The Huffington Post has also done an excellent job with this line of thinking – alternate ways to count medals.  Look here.