The Economist : Armaments supplement

              THE ECONOMIST, October 19, 1929.
The Economist
ARMAMENTS SUPPLEMENT.
SATURDAY, OCTOBER 19, 1929.
CONTENTS.
Introduction :
                                                                                                                                PAGE
Comparison of Expenditure..........................................................................................1
Proposed Model Statements..........................................................................................2
Limitation of Expenditure ..........................................................................................2
Statistical Survey :
Pre-war Situation..................................................................................................................3
War Charges and Budget Totals ........................................................................3
Current Armaments Expenditure .....................................................................4
Armaments and National Incomes ..................................................................5
                                    PAGE
Annexes I.-VI. :
France ......................  5
Germany ...................  6
Great Britain................  6
Italy............................  7
Russia.........................  7
United States of America  7 
Annex VII. :
World Expenditure .......  8
ARMAMENTS EXPENDITURE OF THE WORLD.
The following memorandum has been compiled by Mr. P. Jacobsen, formerly a member of the Economic Section of the Secretariat of the League of Nations, and now Secretary General to the Economic Defence Council of Sweden. The data relating to years earlier than 1909 have been drawn from various sources; and the budget figures for the years 1909-13 have been taken from the closed accounts of the respective countries, as published by the Ministries of Finance or reproduced in statistical Year-Books. The figures for post-war years have been obtained from the closed accounts or budget estimates of the various countries, official sources being used exclusively throughout. It will thus be found that the figures correspond with those given in the Armaments Year-Book (1928) published by the League of Nations. In a few cases only are more recent figures quoted.
The memorandum contains material whose bearing on the work of the Preparatory Commission, on the issues which confront the forthcoming Five-Power Naval Conference, and on the general question of limitation and reduction of armaments, is of capital importance.
INTRODUCTORY.
The magnitude of armaments can be most easily conveyed to the non-expert by reference to the amounts of expenditure in the world's military and naval budgets. Of details concerning armed forces, equipment, stocks, tonnage, aircraft and military service he may know little or nothing; figures of expenditure are comprehensible, and can be related to other facts in which the layman is inclined to take an interest, such as the budget total, rates of taxation, etc. This being the case, the non-expert is naturally prone to employ the expenditure figures for as many purposes as possible, as they are the only data he can conveniently handle. On the other hand, the objection has often been raised that comparison on the basis of expenditure alone may give extremely misleading results, and also that limitation by means of budget restrictions would not be satisfactory.
Different views on these subjects having been put forward in the course of the League's disarmament work, it was decided to investigate the matter. On the initiative of the Preparatory Commission for the Disarmament Conference an expert committee composed of members of the Financial and Economic Committees and of some other League bodies was appointed to deal with these and certain other problems.
Comparison of Armaments Expenditure.
The first question put to the Expert Committee was as follows: —
"Can the magnitude of the armaments of the various States be compared by comparing their military expenditure, and, if so, what method should be followed?"
The Committee came to the conclusion that no such general comparison could be made. Differences in military and naval organisation (voluntary army versus compulsory service), in accounting systems (gross or net budgets), and in levels of prices, salaries and wages, would rule out any direct comparisons — except in a few limited cases, as, for instance, between some Balkan States or some South American States. It would be particularly incorrect to attempt to compare the strength of the English, French and German organisations on the basis of the budget figures, without allowing for all the differences in the respective systems.
The same objections do not apply to a comparison of the figures of defence expenditure from one year to another in the same country. There may, of course, be a change in prices, for which correction has to be made, but, allowing for this factor, analysis of the rise or fall of defence expenditure in a particular country reveals the tendency and development of armaments in that country better than any other method. When changes occur in defence organisations, direct numerical comparisons on the basis of men enlisted, etc., are bound to be misleading. An increase in Air Force material, for instance, may balance a reduction of the army, but a military expert would hesitate to express the fighting value of aeroplanes in terms of infantry numbers. On the other hand, as a country may be expected to get as good value as possible for money expended, comparison in terms of money is the best available criterion.
Quality as distinct from quantity can, in fact, only be measured by means of the money factor. The same " tonnage " may refer to widely different naval strengths, according to the quality of the material used, the age of the ship, and so forth. As to voluntary armies, the stamp of man who enlists and the amount of instruction he receives will largely depend upon the budget provision for " pay " and " schools." Suppose that in a given voluntary army x millions are spent at present in order to obtain a certain stamp of enlisted soldier and to give him a certain degree of instruction. If a sum of 2x millions were expended, the quality of the man attracted would be higher and the instruction would be better.