ABSTRACT
This chapter examines the nature of national defense in order to clarify the underlying goal of military spending. Economists have called many things public goods and then endlessly debated whether the label really applies, but national defense has remained the quintessential public good. Americans in Alaska and Hawaii could very easily be excluded from the US government's defense perimeter, and doing so might enhance the military value of at least conventional US forces to Americans in the other forty-eight states. The public-goods justification for military expenditures rests upon a fundamental equivocation over exactly what service national defense entails. The military's coercive funding unfortunately prevents people from revealing their true preferences about national defense directly and unambiguously. The state has strong incentives to provide national defense that protects itself and its prerogatives, but it has very weak incentives to provide national defense that protects its subjects' lives, property, and liberty.
