South Korea Can Afford Missile Defense and Its Own Defense

By Charles V. Peña

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 purchased from Germany. Under a cost-sharing pact, South Korea currently pays about 40 percent of the costs for the presence of U.S. forces in their country.  So, presumably, South Korea would pay $640 million of the estimated $1.6 billion for a single THHAD battery (South Korean defense officials have previously said they want two batteries). But there is no reason that South Korea can’t pay for THAAD. Indeed, there is no reason South Korea can’t pay for its own defense – and obviate the need for more than 28,000 U.S. troops on the Korean peninsula.

 Clearly, the immediate military threat to South Korea is North Korea. But according to the CIA, the North “faces chronic economic problems” and that “industrial capital stock is nearly beyond repair as a result of years of underinvestment, shortages of spare parts, and poor maintenance.” North Korea’s gross domestic product (GDP) is estimated at $40 billion – about on par with the tiny Polynesian island nation of Tuvalu. Because North Korea is country 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 (which is in line with the State Department's World Military Expenditures and Arms Transfers report estimate). In other words, North Korea spends an extraordinary amount of its very small economy to maintain an outsized military.

 Contrast that to South Korea’s economy, which is the fourth largest in Asia and the 11th largest in the world.  With a GDP of more than $1.3 trillion, South Korea’s economy is more than 30 times larger than the North’s. According to the Stockholm International Peace Research Institute (SIPRI), South Korea only spends 2.6 percent of its GDP on defense but that still amounts to $36 billion – more than three times what North Korea spends. Simply put, South Korea is a very rich country and North Korea is a very poor country.  And the bottom line is that South Korea has the economic advantage and capacity to maintain a military capability to defend against North Korea.

At a bare minimum, South Korea can afford to pay full freight for the cost of U.S. forces deployed there.  Currently, South Korea is paying about $800 million but can clearly afford to pay more. Assuming South Korea’s current share is 40 percent, the total cost would be $2 billion. But that might actually be low based on a 2015 Congressional Budget Office estimate of $99,000 a year for an active duty soldier. If CBO is right, the actual cost for 28,500 U.S. soldiers in South Korea is more like $2.8 billion (and South Korea would be paying less than 30 percent of the total).

 However, the true cost for 28,500 U.S. troops in South Korea is more than the cost of the troops deployed there. The requirements of 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, the risk is soldiers deciding that a military life is too much of a hardship on themselves and their families – resulting in exodus rather than retention. 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 as much as $2.8 billion for the troops deployed in South Korea, it really costs $8.4 billion taking into account the cost of the other 57,000 troops to be able to rotate deployments.

But even if South Korea was 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 if U.S. national security is not 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.

This piece was originally published by The American Conservative on August 29, 2016. Read more HERE