Murphy's Law: The High Price Of Peace


May 18, 2015: Britons are wondering why they have 611 military aircraft available for service while the United States, which has a defense budget nearly 12 times larger, has 23 times as many military aircraft available for service. Put another way, Britain has one military aircraft for every $83 million in annual defense spending while the Americans have one for every $42 million.

The main reason for the discrepancy is economies of scale (overhead and maintenance costs spread over a larger number of aircraft). For each aircraft type a nation has in service there has to be a maintenance infrastructure (spare parts, specialized equipment and personnel skilled in dealing with that aircraft) unique to the needs of that aircraft. Britain has been trying to address this with novel maintenance arrangements, like contracting civilian firms to deal with maintenance and upgrade work done outside the combat zone. But the military still has to use specialist troops and aircraft specific equipment to keep the aircraft flying in a combat zone. The outsourcing approach has saved a lot of money and Britain (and other nations) are seeking to make more use of this approach. But you cannot get away from the fact that nations with large fleets of military aircraft (like the United States, China, Russia and India) will always have the edge because of economies of scale.

Britain has other problems, like nearly constant annual cuts in the defense budget since the Cold War ended in 1991. This “peace dividend” was expected but some overhead is easier to quickly shrink than others. As is the case in most countries cuts in the defense budget are heavily influenced by political decisions. This often means there is always pressure to preserve civilian (and to a lesser extent uniformed military) jobs at the expense of everything else. The United States, even with its lower cost per aircraft, is still beset by this curse of excessive overhead and other politically motivated costs.




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