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South Korea Can Afford Its Own Defense

In July, the United States and South Korea announced the deployment of a Terminal High Altitude Area Defense (THAAD) battery in Seongju County, in the country’s south. South Korea’s deputy national defense minister, Yoo Jeh Seung, said that the THAAD deployment will “protect one-half to two-thirds of the entirety of our citizens from North Korean nuclear and missile threats.” THAAD will be added capability to South Korea’s Patriot PAC-2, which it purchased from Germany.

Under a cost-sharing pact, the South Koreans currently pay about 40 percent of the costs of keeping U.S. forces in their country. However, South Korea isn’t paying a nickel of the estimated $1.6 billion cost of the THAAD battery; all it will do is provide the land and build a base. But there is no reason that South Korea can’t pay for its THAAD battery—or batteries, as officials there have previously said they want two—by itself. Indeed, there is no reason South Korea can’t handle its own defense entirely, obviating the need for the 28,500 U.S. troops currently on the Korean peninsula.

Clearly, the immediate military threat to South Korea is North Korea. But South Korea is far richer than North Korea, and thus can afford to maintain a military capable of defending against it. North Korea’s gross domestic product (GDP) is estimated at $40 billion—about on par with the tiny Polynesian island nation of Tuvalu—while South Korea’s economy is more than 30 times larger at $1.3 trillion. According to the CIA, the North “faces chronic economic problems” and its “industrial capital stock is nearly beyond repair as a result of years of underinvestment, shortages of spare parts, and poor maintenance.”

Because North Korea is largely closed off from the rest of the world, estimates vary on how much it spends on its military, but South Korean Defense Minister Han Min-koo believes the number is $10 billion—or about 25 percent of GDP. This is in line with the State Department’s World Military Expenditures and Arms Transfers report estimate. According to the Stockholm International Peace Research Institute, South Korea spends only 2.6 percent of its GDP on defense, but that still amounts to $36 billion—more than three times what North Korea spends.

At a bare minimum, South Korea can afford to pay full freight for the cost of the U.S. forces deployed there. Currently, South Korea is paying about $800 million, but it can clearly afford to pay more. Given that South Korea’s current share is about 40 percent, the total cost should be around $2 billion—though it’s worth noting that the 40 percent estimate may not be accurate. The Congressional Budget Office estimates that an active-duty soldier costs $99,000 a year, which would add up to $2.8 billion, in which case South Korea is currently paying only about 30 percent of the costs.

In addition, the true cost of 28,500 U.S. troops in South Korea is more than the cost of the troops deployed there. Maintaining a professional volunteer military means that the troops deployed overseas must eventually be relieved by fresh troops. If deployments are excessively long or result in being away from home and family too frequently, soldiers may decide that military life is too much of a hardship on them and their families. For an all-volunteer force, the rule of thumb for retaining soldiers over time is a 3:1 rotation ratio (meaning three total units are needed to keep one unit deployed) for active-duty forces. So if it costs $2 billion for the 28,500 troops deployed in South Korea, it really costs much more taking into account the other 57,000 troops needed to be able to rotate deployments.

But even if South Korea is willing to pay for the full cost of U.S. troops, there really is no reason for the U.S. to have 28,500 troops in South Korea. North Korea is not a direct military threat to the United States, so there is no need to put American soldiers at risk. Moreover, if North Korea (with a nearly one-million-man army) decided to invade South Korea, the defense of South Korea would rest primarily with that country’s 700,000-man military, not 28,500 U.S. troops.

Charles V. Peña is a senior fellow with the Defense Priorities Foundation. He has more than 25 years of experience as a policy and program analyst and senior manager, supporting both the Department of Defense and Department of Homeland Security. Peña is the former director of defense-policy studies at the Cato Institute and author of Winning the Un-War: A New Strategy for the War on Terrorism [1].

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11 Comments To "South Korea Can Afford Its Own Defense"

#1 Comment By Dan On August 29, 2016 @ 9:29 am

Yes of course South Korea could manage its own defence against N Korea but if America wants to keep a variety of bases in South Korea why should they?

Korea is sitting between China, Japan and Russia. It has a good economy with lots of US multinationals having an intrest in the continuing expansion of the South Korean economy.

In terms of ground troops the Korean Army contributes 500,000 men while the US contributes 20,000. The 20,000 is the barest minimum contribution the US can make without a fully independant Koran forign and defence policy.

The US wants to have bases in Korea to stop Korea doing a deal with Russia, China or Japan. At present if the US left collaboration between S Korea and China would be most likely. It has even kept going a long term fiction of the multi-national UN Command Korea to justify US bases in Japan.

The US wants to have bases all over the world, it wants to use the leverage of its enormous military to influence politics and Ecconomics, as described by a rules based system as long as Americans write the rules! However it then wants everyone else to be grateful, and in theory it wants other countries to spend more on defence but to only use their military on terms the US will allow.

Part of the THAAD example is the US is cautious about selling the technology to Korea as it would lose some control over how it would be used, and fears espionage leakage to China.

#2 Comment By Uncle Billy On August 29, 2016 @ 9:45 am

Those 28K US troops in South Korea serve as a trip wire. If the North Koreans attack and kill a bunch of Americans, then the US Military will be justified in destroying them by any means necessary, up to and including tactical nukes.

I would bet money that we have let the Chinese know that if North Korea attacks and kills some of our people, then there will be no holding back. I would bet that we have let Boy Wonder in North Korea know this too.

#3 Comment By LouisM On August 29, 2016 @ 11:49 am

There is only one real defense of south korea and that is reunification.

I keep hearing that South Korea cant afford reunification because the North is too poor, or that China would allow losing its proxy state, or that Japan wouldn’t allow a rival in a unified korea to emerge. ITS ALL HOGWASH! HORSE HOCKEY!

1) a unified korea would be a greater asset to the United States and Japan
2) china would much prefer a unified korea than japan and south korea becoming nuclear states.
3) south korea, japan, Taiwan are already distancing themselves from US hegemony out of fear of reprisal from china (reprisals that the US is insulated). The time for treating them like vassal states has long passed. Setting them free may mean they do not follow US dictates 100% but I don’t think they would be any less reliable allies. Each has millennia of history with their neighbor and each has experienced more autonomy and freedom and rising living standards than they would under Chinese hegemon. Each will continue to balance between the US and China whether or not they are vassal states under US hegemon but set free…it will be their money, their troops and their decisions in an alliance. The result is restraining the US from feckless and reckless foreign interventions but far more reliable partnership in defense and diplomacy when the needed.

#4 Comment By Tiber On August 29, 2016 @ 1:04 pm

Just as Dan says, we don’t keep troops in South Korea out of charity. We keep troops there because the U.S. government wants a force stationed in different corners of the world so that it can react immediately to any threat to its interests. You can agree or disagree with this philosophy, but North Korea is just one small part of why this deal is in place.

LouisM, while I would be happy to see the North Korean government ousted and Korea reunited, I’m afraid your assessment of the situation is all wrong. China wants to be the 800 lb. gorilla of the east, and in a sense they already are. However, this 900 lb. gorilla called the U.S. keeps trying to have its way in the east and the west. China has long been an imperial power in Asia, and the U.S. and Britain disrupted that. Many Asian countries have very old grudges with China (and for that matter Japan), and find it worth siding with the U.S. to counter China, regardless of their personal opinion of U.S. foreign policy. I’m pretty sure China hates having to deal with the crazy Kims; however they want much less to have to deal with a wave of refugees if the North and South ever duke it out, and they certainly don’t want a country that’s very friendly with the U.S. at their border afterwards. I also believe Taiwan is friendly to the U.S., because China wants Taiwan back under their thumb, but the U.S. privately offers support to prevent that from happening.

#5 Comment By GregR On August 29, 2016 @ 3:29 pm

This really misses the point. Having troops stationed in S Korea and Japan actually saves the US Government money. It’s not like we can justifying them home and all of a sudden the entire cost of those troops disappears after all.

Taken as given that it costs about $100k to have a troop deployed to S Korea, and about $90k to have that same troop stationed in California. If S Korea is carrying $40k per troop stationed there, bringing troops home will end up costing us about $30,000/year for every military member brought home.

There is a reasonable argument that out military is too large (and one I wouldn’t quibble with) but on a per troop cost the ones that are deployed are actually the cheapest we have.


#6 Comment By Uncle Billy On August 29, 2016 @ 3:38 pm

Let the Chinese be the 800lb gorilla in East Asia. Let the Koreans, Japanese, Vietnamese, etc work out their own deals with the Chinese. The United States should not go to war with China over a border dispute between CHina and Vietnam.

#7 Comment By Tao Dao Man On August 29, 2016 @ 8:05 pm

I live in Korea 6 months out of the year, and 6 months in the US.
When I tell Koreans that the US military should leave Korea, I get that deer in the headlight look. THAAD will NOT cover Seoul where more than 10 million Koreans live.
DPRK has 30,000 rockets aimed at Seoul that would devastate the City.If,big IF DPRK attacks the ROK the US would make a nuclear parking lot of the north.
Right now IF the north attacks all ROK troops are instantly under the US command.
ROK is nothing more than a US military colony aimed at China. The day will come when a Sino-Russo security agreement will be given to the DPRK, because the last thing the US wants is Peace on the peninsula. If there is peace, then the US can not justify its Korean colony.

#8 Comment By jk On August 29, 2016 @ 8:12 pm

I like the “it is cheaper to have troops deployed” variant.

Kind of makes you wonder what is the point of US troops if they are all forward deployed protecting other rich nations?

One of the biggest personnel costs (other than pensions and healthcare) in the military are the trainup of the troops. S. Korea has zero dollars invested in it. There is also the rentier aspect of the host nation where the local contractors and government officials (sometimes combination of both) have an incentive to maximize the costs imposed on the US personnel and their dependents and extract as much benefits from them as possible.

Another cost that is not taken into account is the moral hazard of having forward deployed US troops. This has been touched on numerous times and enables countries to act more boldly and perhaps recklessly since they believe they have US military insurance to fall back on no matter how reckless they are.

Also the US forces stationed in S. Korea are not an asset for the US military at large. They do not go to the “hotspots” of the world. They are not a global 911 force. They cannot deploy from S. Korea since their purpose is to defend S. Korea. So tens of thousands of troops are allocated to protect another country while that country gets all the benefits of the protection. They are not an asset for the US at all.

How does indefenite presence in Korea benefit the US?

#9 Comment By jk On August 29, 2016 @ 8:17 pm

Who cares if S. Korea “deals” with Russia? Samsung, Kia et al are all benefiting from global trade at US defense expense anyways. Seems like a one way deal to me, just like NATO.

US assumes the costlier and riskier military/diplomatic costs, client states profit from security apparatuses the US provides and may even profit from trade with “enemies” of the US.

That’s freeloading to the core.

#10 Comment By Carlton Meyer On August 30, 2016 @ 3:02 pm

South Korea doesn’t pay the USA a cent! Where did you get that 40% figure? They pay rent to Koreans for land use, and pay for some buildings, but they don’t pay us anything. Please correct that, and don’t cite some BS US Army figure that provides no data.

#11 Comment By Lance On August 31, 2016 @ 7:31 pm

Its call influence. From a geopolitical standpoint, we want other countries dependent on us. The goal is a stable world, which is much cheaper for everyone. What would it cost the U.S. if a large scale war broke out between Asian countries?

Its like the misguided concerns over foreign aid spending. Foreign aid is a euphemism for geopolitical influence.