The Budget Cost of a Volunteer Military

by Steven L. Canby, Benjamin P. Klotz

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An all-volunteer military with the combat effectiveness of a 2.65-million-man draft-induced force would cost only $2.1 to $2.5 billion more yearly, including longevity and retirement. Short-run budgetary phasing-in costs are about $.75 billion — a fraction of earlier estimates. Less training and fewer officers are needed. The Army's distinctive recruitment problem is analyzed separately. Lowest-category men, always in oversupply, need no further attraction. The number of U.S. males turning 18 each year has increased sharply since 1964. The perceived wage is the crucial variable — fringe benefits are not valued anywhere near their cost to the government. Selective enlistment bonuses are recommended to offset the Army's recruiting disadvantage. Because of perceived pay and depressed wage levels for entrants, results are insensitive to changes in youth unemployment and supply elasticity.

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