Ron Paul Says We Subsidize German Socialism. Do We Really? Analysis and Conclusion...
The short answer is, Yes.
However short answers rarely suffice, so I have done the research to bolster Dr. Paul's point that we subsidize German socialism through our military expenditures. Feel free to use this information to support the idea that Ron Paul has incredible depth of insight into our foreign policy, even on such a minute level as EU troop deployment and its economic effects.
US Spending on Bases in Germany Versus German Military Spending
German Active Duty Soldiers
Air Force: 35,752
source: Federal Ministry of Defence, Germany
US Troops in Germany
Army: Approximately 50,000
Air Force: Approximately 15,000
sources: Slate Magazine, Die Welt (German)
German spending on the military in 2011 is projected to be about $41.2bn, or €31.54bn. Germany contributes about $1bn towards U.S. base upkeep. However, the United States spends approximately $1bn maintaining Ramstein Air Base alone, and the 43 other bases cost about $240m each. source: German Information Center, citing a Council on Foreign Relations Report
All told, the United States spends somewhere north of $11 billion maintaining bases in Germany.
Comparing that to the $41.2 billion Germany spends on its own military, we contribute another 20 percent more, or one-quarter of what they spend on their own military. It's hard to say that we don't contribute to Germany's having to spend less on their own military. The numbers bear it out.
US Troops' Economic Impact On German Economy
Heritage Foundation Finds a Relationship
source: The Heritage Foundation
Given the fact that the United States conservatively has about 65,000 troops in Germany, we can safely assume that the economic impact is significantly greater than the 1 percent GDP effect that US troops have in Germany. Heritage's analysis does not reveal the numbers specifically for Germany, so we must infer. That doesn't mean it is a 6.5% GDP increase per annum that can be correlated with troop deployment levels in Germany, but it is surely higher - and the Heritage Foundation data shows this, as Germany is the single non-mission country overseas in which the U.S. has the highest troop deployment at a given time. To put it another way, since WWII, Germany has had more US troops stationed than any other nation on a regular basis.
Proposed Troop Reduction Estimates Economic Loss in German Newspaper
From earlier this year:
sources: Aviation Week, Die Welt (German), Die Welt (English translation by Babelfish)
From this newspaper report, we know that a reduction of 5,507 troops results in an estimated tax loss to Germany of €13.5 million. Other reductions totaling 4,964 civilian and other personnel are mentioned; to factor in the other personnel, we shall estimate that the 5,507 troops and their families account for a tax loss of approximately 7 million euros on the high end, and on the low end, perhaps 6 million euros.
Given our low estimate of 65,000 troops in Germany from earlier, 5,507 troops represents about 8.47% of the force that we have had there. Given the two estimates of 7 million and 6 million euros for the liberal and conservative estimates respectively:
8.47x = 7,000,000 (100) = ~ €82.64m ($114,596,888)
8.47x = 6,000,000 (100) = ~ €70.84m ($98,233,828)
The active duty troops and their families that have been stationed in Germany are funding the German government, at a minimum, between 70.8 million and 82.6 million euros per year.
Germany's 2010 budget was approximately €325.4bn. As a result, our troops' spending make up around 0.025% of Germany's revenue. Does that seem significant? Perhaps it doesn't... but consider this: if we were to apply the same percentage to U.S. tax revenue in 2010 ($2.16 trillion) we would come up with $540,000,000. Not huge money in terms of our federal leviathan, but sufficiently enough for someone to say that it certainly has an impact upon our revenues. When you consider that Germany's tax revenues are only a small amount of the total amount spent by our troops in Germany, you realize that the total economic impact they have is in fact far greater.
Considering total spending by us into Germany, it is hard to conclude anything other than we are expatriating billions of dollars.
Ron Paul is right about us subsidizing Germany.
By spending about one-quarter on our bases in Germany of what Germany itself spends on its entire military budget, we give them plenty of reasons to want to keep us - and plenty of extra money that they don't have to spend further bolstering their own defenses.