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National Defense Budget Standing
Analysis of Modern Weapon Systems
Military alliance and arrangement of the defense budget
Strategic sharing

The American security pledge to Korea implies the securing of automatic intervention and provision of the nuclear umbrella with the nuclear warhead strategy and annual ‘Team Spirit Training’.

The expansion of the function of American forces in Korea means the expansion to a wider role extending to the Pacific, Indian and Atlantic Oceans, as part of the world strategy and as a consequence defense sharing by Korea is required.

Korea should take responsibility for about 20 million dollars annually owing to the military contribution required for the seaway security reaching the Persian Gulf that occupies 48% of the oil import. In addition, Korea had agreed that three Korean destroyers participate in Rimpac, the ocean sea maneuver training under the control of the American third fleet in the middle of 1990.

The Korean navy will also establish a base to participate in the wider function of the American forces in Korea as an organization of the triangle security system of Korea, the U.S., and Japan at this time as Japan has developed the capacity to take charge of the protection of the sea road of 1,000 knots to Taiwan from Tokyo Gulf.

The basic principle of the combined control war power of the present Korea and U.S. is based on the strategic principle to deter invasion and to recover the peace under profitable conditions for the U.S. and allied nations in the case of failure to deter, in addition to the tactical principles of the centralized decision making policy with decentralized execution, and common military doctrine.

Korea should consider the historical fact of the mistake by the American army that failed to expect or prevent the intervention of China’s forces, which frustrated the reunification of the Korean Peninsular and became the Korean War that was centered on the Korean Peninsular and was considered a controlled local war.

Consequently, it is obvious that an invasion war of the Korean containment attack or a self-defense war by prevention of attack will never be permitted now that the united restraint strategy concept is based on the American national strategy. In the case of an invasion by North Korea, the cease-fire line breakthrough drive, the next stage of peace recuperation in preventing the extension of war will be restrained. A strategic dilemma exists between Korea and the U.S. in this respect.

However, the American forces in Korea aren’t stationed in this territory eternally, and it is uncertain what position the local domestic and foreign threat will develop into. It is obvious that the position for Korea with a large military potentiality will be created.

The intelligence cooperation relations between Korea and the U.S. have been maintained to exclusive devotion and dependence on the U.S. The military information cooperation was attained during the Korea War. The American Central Intelligence Agency (CIA) operated in a decisive role to help the training of the Korean army prepare for the guerrilla warfare and penetration to the rear line of the opponent. Then the CIA reported the strategic intelligence to the relevant agency and has maintained a close and familiar relationship with the Korean government.

Although, the Korean Central Intelligence Agency may bring about conflict between the same kind of agencies in Korea and the U.S. by not following the mission and concentrating on the search for disorder factors and detection of system overturn actions.

The intelligence organization called J2 under the Korean and U.S. Combined Headquarters shares a large quantity of military intelligence. However, Korea complains of the limited exchange of the military intelligence. In other words, the American forces in Korea provide more intelligence for England, Australia, and New Zealand than for Korea. In spite of this problem, Korea and the U.S. have exchanged telecommunication intelligence according to UKUSA Telecommunication Exchange since 1947.

INSCOM of the American army, Classic Wizard, the intelligence agency to the submarine and water ships of the American navy, and high-frequency direction detection agency play the decisive role of collecting military intelligence on North Korea in Korea.

Technological sharing

One of the problems related to the Korean and U.S. defense sharing is the absence of the Korean independent intelligence capacity. In other words, the absence of the military operations capacity is a basic obstruction factor impossible for Korea and the U.S. to share the strategy. The urgent and important task is to develop equal intelligence exchange between Korea and the U.S. to establish the Korean army’s independent military information collection system.

At present the Korean ammunition, armored cars, and missiles are produced as part ofthe American military technical support. This one-sided state of dependence on the U.S. in the defense industry technology field becomes an obstruction factor to the improvement of the independence of the Korean defense industry and the export of Korean licensed weapons.

The items requiring the prior approval of the U.S. State Department are numerous. There are 42 kinds of weapons produced in Korea at present requiring approval, such as M-16 rifles, M-60 auto rifles, 20mm Vulcan cannons, and 8" howitzers and their cannon balls. The items related to the quantity limitation include 105mm and 155mm howitzers, 81mm and 4.2" mortars, and their cannon balls.

The American control reinforcement measure is to ensure a continuous monopoly of the world’s traditional weapon market in addition to its won defense industry protection strategy.

The problem facing Korea is not to lapse into the dilemma of depending on export for operating the production facility as it approaches the stage where the defense industry products exceed the domestic demand. Korea should make diplomatic negotiations so as to permit the overseas sale of the Korean licensed weapons with transfer of the technology, mutual development of weapons, and improvement of common areas.

The major obstruction in defense industry cooperation between Korea and the U.S. lies in the one-sided dependent relationship. The reason that the transfer number of technological materials by the American defense industry has been reduced is that the overseas export of Korean licensed weapons encroaches on the U.S. market.

Principle and prospect of the defense budget sharing

The requirements of the American defense sharing didn’t go beyond the strategic cost-sharing category in the past. The requirement of support, economic assistance, or wage support for the U.S. army employed workers can be viewed as the indirect and strategic increasing push for the augmentation of role and function.

It is expected that the requirements of the defense sharing for Korea will increase considering the present situation where the budget for the American forcesin Korea has been reduced by dropping the national defense budget to settle the economic difficulty suffered owing to the emergence of the American decline theory and severe financial and trade deficits.

However, that the U. S. has stationed military power in excess of one army division should be understood in the vein that the stability of the Korean Peninsular is part of the American world strategy. Consequently, the mutual partial conflict can be settled by mutual reliance and respect on the assumption of a problem-sharing consciousness in respect of the national profit that Korea and the U.S. pursue for the settlement of the present problem related to defense sharing.

The NATO and Japanese shared defense budgets

The arrangement of the defense budget means the fair distribution of political, personnel, material, and economic budgeting among nations for the maintenance and management of allied relations, as the concept is applied to the military cooperation through the military alliance. The main target of sharing includes the defense budget size, budget support of the stationed nation, and the united defense budget.

NATO doesn’t represent an adequate balanced allocation among the membership nations and as such, contributes to the severe political conflict at present. I intend to aid the arrangement of the defense budget policy development with the U.S. by examining the dispute on the grounds of the recently emphasized proper sharing for the defense budget as it stands between the U.S., NATO, and Japan.

Background of arrangement demand of the defense budget

That The American national power has become relatively weak in relation to the remarkable economic development of other allied nations over the past 20 years is a major reason why the U.S. strongly requires the shared arrangement of the defense budget with allied nations. The American economic power, which occupied 34% of GNP of the whole world in the 1960s, decreased to 20% in the 1980s, and went from a 110 billion dollar deficit and a 200 billion dollar financial deficit in 1984.

Conversely, the economic power sharply improved for the former West Germany and Japan. The1970s GNP of these American allies, improved by four times for the former West Germany and by five times for Japan by the 1980s. The U.S. can’t resist using the capacity of the rich allied nations to recover from its military inferiority caused by its reduced economic power.

The theoretical background and measurement index of the arrangement of the defense budget

The logical conditions for the arrangement of the defense budget are to consider trailing the budget in respect of its public economic theory by treating the alliance relations as public material.

The trial, to deduce the basis for sharing the theoretical defense budget in relation to national economic security taxes, includes the profit principle and payment capacity principle. The profit principle is the opinion that the nation should share the security profit through the alliance and the payment capacity principle is the logic for sharing equally in the national economic payment capacity.

However, the fundamental problem of these principles is that it is difficult to measure the national security profit. Consequently the use of the most important economic payment capacity index and political settlement is inevitable.

The representative index used to measure the economic payment capacity of the defense allocation includes the GNP occupation rate and the prosperity index. The GNP occupation rate means the rate that the national GNP is occupied in relation to the total GNP and the prosperity index is the index by which to consider the total GNP and GNP per person. The value of the prosperity index can be calculated using the following formula multiplying the occupancy rate for the GNP of the allied nations as a whole by the national GNP per person when compared with GNP per person, calculating the maximum level required from the allies as a percentage.

Classified

GNP occupancy(1)

GNP per person(2)

(1)×(2)

Prosperity index

COUNTRY A

60%

1
60
75%

COUNTRY B

40%

0.5
20
25%

Total

100%

-
0
100%
<Table 2-3-4> Prosperity index of COUNTRY B

The prosperity index is assessed to have a lower value than GNP occupancy rate in nations with a low living standard and the nations with largest national GNP and GNP per person should take responsibility for a greater share of the common defense budget. This was applied in NATO.

The index to measure the contribution for the common defense organization, in other words, the defense budget charge includes the occupancy rate of the defense budget, the occupancy rate of military power, and the actual increase int he defense budget. The occupancy rate of the defense budget is the rate that the national defense budget occupies out of the total defense budget ;the occupancy rate of the military power is the rate that the national military power occupies out of the total military power of the allies as a whole. Whether the arrangement of the defense budget is reasonable can be judged using the indexes mentioned so far.

Classified

GNP occupancy (1)

GNP occupancy (1)

(2)/(1)

COUNTRY A

60%

40%

0.67

COUNTRY B

40%

60%

1.50

<Table 2-3-5> Arrangement index of defense budget

The arrangement of the defense budget of NATO and Japan

The result in calculating and comparing the arrangement level for defense budget of NATO and Japan, using the arrangement index of the defense budget discussed above, can be seen in <Table 2-3-6>.  

The nations where the defense budget in comparison with the sharing capacity exceeds the reasonable base ‘1’ are the U. S., France, England, and Turkey and those nations under ‘1’ are Japan, the former West Germany, Italy, and Canada, and in particular, Japan is extremely low.

The defense budget is larger than the capacity in the developed NATO nations including Turkey, Portugal, and Greece when compared to the common defense sharing between NATO nations and Japan in respect of contribution for the defense sharing for the following prosperity index. The defense budget is also lower than the capacity in France, the former West German, and Japan.  

The resolution for a 3% actual defense budget increase as a symbol of defense sharing among NATO membership nations wasagreed by the membership nations with strong assertion from the Carter administration in 1978 for raising a caution and settling the war power difference. However, the nations over the object level were the U.S., England, and Italy and the contribution of NATO European nations in comparison with the U.S. was low as seen in <Table 2- 3- 7>.

In the early days only 5 nations participated in the Infrastructure program, but at present 14 nations participate. Its objective was to construct a common facility of NATO forces for the wartime over 5 years.

The major project target contained 14 projects including the airdrome, the telecommunications facility, and ammunition storage facility and the project size was expanded from 700 million dollars in the first half of 1970s to 78 billion dollars in the late 1980s.  

The former West Germany increased from 14% in the first half of 1960s to 26.5% in the first half of 1980s and England increased from 9.8% to 12%, while the American cost sharing remained similar to the reduction tendency that the American defense budget, out of total defense budget of NATO, decreased from 74% in 1960 to 60% in 1980.

The U.S. forced the military power of about 520 thousand persons, 21.3% of total military power of the U.S. to be stationed in 1983. 250 thousand persons, 25% of them were stationed in the former West Germany and 50 thousand persons in Japan. These took the various supports from the stationed nations according to SOFA between stationed nations and the U.S.

The U. S. requires that stationed nations support the cost of the stationed American forces according to SOFA as mentioned beforehand in addition to flexible adjustment for the American forces tosave on the maintenance cost for the overseas American forces. Though to convert the various cost supports into the money may be less than accurate, the result calculated using the limited data is as <Table 2-3-10>.

Nation

Index

Japan

Former West Germany

U. S. Army occupation forces (80)

46 thousand persons (8.1%)

244 thousand persons (49.9%)

Total annual maintenance cost (A)

1,050 million dollars

558,800 million dollars

Maintenance cost per head

228,000 dollars

22.900 dollars

Assistance from stationed nation(A)

101,700million dollars

5,000-6,000 million dollars

Assistance per head

22,100 dollars

20.000-24.600 dollars

Stationed countries’ budget sharing (A: B)

0.96 times

0.89-1.07 times

<Table 2-3-10> Stationed countries budget sharing

In 1980, the number of U. S. Army personnel in Japan was about 46 thousand, about 8% of the total of the foreign-stationed military power of the U. S. Army. They consumed total 1,050 million dollars as annual maintenance cost. This equates to 24,000 dollars per head. The Japanese government supported the U. S. Army in Japan, to the amount of 1,017 million dollars, so the assistance per head was about 22,100 dollars and the sharing rate of the stationed budget of the U. S. and Japan was 1: 0. 96

On the other hand, 244,000 U. S. Army personnel in former West Germany used 5,588 million dollars annually for maintenance while former West Germany spent 5,000-6,000 million dollars for the army, and the sharing rate of the stationed budget was 1: 0.89-1.07, which was similar to that of Japan.  

Despite such a burden of stationed country assistance, the U. S. made full-scale negotiations with many nations of NATO and Japan, and 1n 1982 reached an agreement on stationed country support(Host Nation support) with former West Germany, England, the Netherlands, Belgium, Luxembourg and Japan, and in particular, executed a warfare stationed country support agreement with former West Germany to guarantee stationed country support in peacetime and war time in 1983.  

The arrangement of the defense budget is designed to let the countries share the cost in proportion to the merit they receive from common defense it is somewhat like the mentality of using light. The persons who did not share the costs for construction and maintenance of the lighthouse can still enjoy the benefits from it. In this way, there may be the free riders that want to share the benefits under the umbrella of the defense community without cost sharing, while the burden is taken on more readily by the countries that have the economic capacity or feel the threat more keenly and will take charge for the lager portion of the cost.  

To measure the level of defense sharing, various measurement indexes were provided. But it is not easy to select an index that is satisfactory to every nation, so sometimes it is inevitable to take political solutions.  

When we look into the arrangement of the defense budget standing of NATO and Japan, the U.S. is allotted slightly above the reasonable level, but the wealthy European nations are in the lower level. In particular, Japan has an extremely low sharing rate compared to its economic power. In the case of the NATO perpetual base project, which can be called a united defense budget, the sharing rate of America has been diminished gradually, while the portion of former West Germany has tended to increase. As stationed country budget support, former West Germany and Japan spent 2,200 dollars per head on stationed U. S. Army personnel this is an equal amount to the rate of the American share.

This arrangement of the defense budget among the U. S., NATO and Japan suggests many things. Korea and the U.S. are military allies but at the same time, both are in competition in economy. We have to develop a policy toward the U.S. to cope withstand the potential of requests for rising defense costs.  

Military cost /

GNP

GNP per person

Under 200

200-499

500-999

1,000-2,999

3,000-9,000

Over 10,000

10% or more

Vietnam,Cambodia,Laos

South Yemen,Afghanistan, Guyana

North Yemen,Morocco,Albania

North Korea,Jordan,Syria, Angola, Mongolia

Oman, Iraq, Israel, Saudi Arabia, Russia, Libya, Nicaragua Bulgaria

Qatar

5-9.9%

Ethiopia,

Mozambique

Zambia, Pakistan

Zimbabwe,El Salvador, Thailand, Honduras, Bolivia,Ecuador, Senegal

Egypt,

Lebanon,

Cuba,Gabon

Iran, Poland, Czech,Slovakia, Greece, Rumania, Hungary, Singapore

Arab Emirate,

U. S. A.,

Kuwait

2-4.9%

Tanzania,

Somalia,

Mada Cascara

China, India, Liberia, Chad, Togo, Sri Lanka, Myanmar, means, Kenya, Benin, Indonesia

Ivory Coast, Guatemala, Papua New Guinea, Dominica, Swaziland, Philippine, Jamaica

Peru, Korea, Congo, Turkey, South Africa, Chile, Venezuela, Malaysia, Tunisia, Algeria, Yugoslavia, Panama

Taiwan,

Bahrain,

Portugal,

Spain

England, France, Norway, Netherlands, Germany, Belgium, Sweden, Australia, Italy, New Zealand, Canada, Denmark, Switzerland

1-1.9%

Zaire, Bangladesh, Malawi, Gambia, Nepal

Haiti,

Guinea,

Uganda

 

Cameroon, Uruguay, Argentina, Columbia, Paraguay

Ireland,

Malta

 

1% or less

 

Ghana,Niger,Nigeria

 

Brazil, Costa Rica, Mexico

Cyprus

 

<Table 2-3-11> relative share standing of world national military cost (1987)

(Source: World military Budget and Weapon Transfer, 1988-1989, p. 14)

Natural withdrawal viewpoint

Let us consider the Korean-stationed U.S. army withdrawal policy that the recent American CATO Institute presented in the administration and Congress report of Senator Carl Levin of the Democratic Party.

Korea continues to experience political crisis, but democracy has taken root in Korea. Korea has grown to become a strong nation in the northeast of Asia with American support, but serious tension hangs between Korea and the U.S. Consequently, the period to re-examine the withdrawal problem of American forces in Korea has come about. Korea has rise to an economic power 5 times that of North Korea and more than twice the population. It possesses worldwide competitiveness in computers, automobiles, and the construction industry. In addition, threat decreases as China and North Korean allied forces have projected the peaceful settlement of the Korean Peninsular dispute. Therefore the American forces in Korea will not be needed any longer for defending Korea.

The U. S. cannot undertake the unbalanced charge of maintaining the common defense of the free world in relation to the active change of the international security environment any more. The U. S. having maintained the security shield for the allied nations has contributed little to the common defense except in that the partial allied nations have developed their own national resources for their economic development.

Cost sharing means the distribution of ventures, roles, and responsibilities among the allied nations. Korea has thrown a third of the national budget and 5-6% of GNP into the national defense budget for the past 10 years in respect of the economy. It shows that Korea disburses more than other allied nations of the American army.

Similarly, as the U.S. individually takes charge of the balanced defense share, the U.S. loses excessively in as far as it causes inconvenience in the future economic growth.

Considering this, the U. S. set up a 5 year time limit for Korea to achieve a self maintaining capacity at which point, it will withdraw the American forces in Korea completely. The U.S. should persuade Korea to purchase the American forces equipment in Korea using the annual trade surplus of billions of dollars.

The U.S. will then avoid the inevitable automatic intervention in the emergency area. This is a most important and useful trip wire function in the withdrawal of American forces in Korea, and can save the national budget. In addition, the worldwide unbalanced charge that the U. S. bears can be reduced, and the Korean and American defense treaty will be able to be revised to settle the political friction between Korea and the U.S.

Withdrawal objection viewpoint

There are a number of factors contending the decision to adopt the course of Carter’s withdrawal policy. In particular, General Richard G. Stilwell who held the position of American forces Commander in Korea form 1973 to 1976 emphasized the station necessity of the American forces in Korea. He presented the following reason, which has been accepted as the most persuasive logic so far in the American position.

It can reinforce the companion relations with Japan,

it can minimize the Russian power combative spirit,

it can contribute to the improvement of relations with China,

it forces the Far East area to continue to improve the economy,

it creates the appropriate environment for democratic system development of the nations in the area,

it can secure the nuclear spread prevention through the security pledge.

The National Defense Secretary We in berger presented the following six suggestions for the American Pacific Ocean policy in his speech in the Washington Press Club in December 1983.

American will to hold the Pacific Ocean power

Importance of the U.S. and Japanese security relations

American commitment to security of the Korean Peninsular

Continuous relations improvement with China

Assistance in keeping up with the Asean empire

Relations with the ANZUS treaty membership countries.

I The reaction caused by tension between Korea and the U.S. in their relations may encourage closer relations among Korea, China, and the former Soviet Union.

The provocation possibility from North Korea is increased in the absence of power in the Korean Peninsular.

The U.S. will lose the usefulness of familiar relations with China and Japan and the contact with China and the former Soviet Union of the Asean empire will be promoted.

As the influence of China and Russia on North Korea increases competitively, the mutual cooperation relations will get worse.

The U.S. pursues the defensive demilitarization for the Russian nuclear war power by realizing the SDI concurrently with mutual restraint through superiority in strategic nuclear war power in respect of three factors of the American national strategy as mentioned earlier. In addition, the U.S. continuously makes advance arrangements in the coastal regions of the Pacific Ocean and in the Atlantic Ocean for cooperation of front line defense for the American world strategy and intends to cope with the powerful Russia by forming the united war power with the allied nations in the center of the maritime power.

Arrangement of the defense budget

The U.S. requires that the stationed nations will take charge of the maintenance cost of overseas-stationed military power since the financial deficit deepened several years ago. The requirement of the U.S. can be expressed as defense budget sharing in the sense that the stationed nations should pay the cost that which the U.S. army takes charge of.

The requirement of the American defense budget sharing meets the various difficulties in the world owing to tension relaxation and the reduction efforts of traditional and nuclear weapons.

Though the assertion for the withdrawal of American forces in Korea is raised, the relations between both nations in relation to the defense budget sharing are very friendly. Korea’s government has expressed that it will expand the defense budget sharing.

The issue on arrangements of the defense budget will be brought up for as long as the American forces are maintained in Korea. The size of Korea’s shared amount depends on the stipulated role of American forces in Korea. Investigation and official agreement on this topic between Korea and the U.S. has emerged as an important pending problem that can no longer be put off.

In fact, the present authorized role of the American forces in Korea is the historical result of the Korean and U.S. relations over dozens of years. The standing of the American forces in Korea has been reinforced through many agreements, treaties, and memorandums since the Korean War. The Korean military operations authority was transferred to the U.S. in a series of letters between President Lee Seung Man and General Macarthur in July 1950 during the war, and the unlimited authority of the American forces in Korea was secured according to the Mutual Defense Treaty in August 1953.  

The preferential treatment that the American forces enjoy in Korea is regarded as exceptional and therefore brings about various side effects such as the prevalence of smuggled goods by the American forces in Korea. As Korea hasn’t secured the independent customs examination authority for the American forces in Korea, unlike Japan or NATO membership nations, the smuggling by the American forces in Korea and their families is common. The smuggling that the Customs Administration Office exposed from 1981 to 1988 is totalized to 2,417 cases and 7,976 million dollars. In addition, Korea gave up the jurisdiction of 99.3% of U.S. army crimes, amounting to33,068 cases, that happened during the 20 years following the announcement of the Korean and U.S. Administration Agreement in 1967, as Korea couldn’t execute the jurisdiction for the U.S. army crimes on its own people.

The preferential treatment that the American forces enjoy in Korea directly affects the role of investigation work and as a result, it leads to suspicion regarding the requirements and approval of the defense budget sharing. This issue of the defense budget sharing is in line with Korean and U.S. relations. Therefore, negotiation on the defense budget amount by specific individuals or minor political groups has scheduled limitations.