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Argument: Mandatory military service is more expensive

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Bruce Chapman. "A bad idea whose time is past: the case against universal service." Brookings Institute. 2002: "The $20,000 per involuntary volunteer estimated by Litan is too low. The more realistic total figure would be more like $27,000 to $30,000. First, the federal cost for a full-time AmeriCorps member is about $16,000, according to AmeriCorps officials. And that, recall, is for an average 10-month stint, so add another $3,000 or so for a 12-month term of service. (The $10,000 figure cited by Litan appears to average the cost of part-time volunteers with that of full-time volunteers.) Giving the involuntary volunteers the AmeriCorps education benefit of some $4,000 brings the total to about $23,000 of federal contribution for the full-time, one-year participant, which, with local or private match, will easily reach a total cost of some $30,000. Few unskilled young people just out of school make that in private employment!

Because organized compulsion costs more than real volunteering, however, the indirect expenses for governments would be still greater. Chief among these are the hidden financial costs of universal national service to the economy in the form of forgone labor. That problem plagued the old draft and would be more acute now. The United States has suffered a labor shortage for most of the past two decades, with the dearth of educated and trained labor especially serious. Yet universal service advocates want to pluck out of the employment ranks some 4 million people a year and apply a command-and-control approach to their optimal use. How can we even calculate the waste?

Litan says that in 1995 the GAO "positively evaluated" a cost-benefit study of three AmeriCorps programs that found them to produce quantifiable monetary benefits of $1.68 to $2.58 for every dollar invested. But Litan overstates the GAO's "positive evaluation" of the private study's findings. The GAO study merely analyzes the methodology of the private study based on the assumptions that are baked into it. These assumptions (of future benefits and their dollar values) are inherently "problematic," based as they are on "projected data." And neither the GAO nor the private study whose methodology it checked says anything about the applicability of the private study to some universal service program. Inferring GAO endorsement for some putative financial benefits from a national service scheme—let alone a program of compulsory national service—is not good economics.

By contrast, a recent review of the literature and evidence of government spending by William Niskanen, former chairman of the President's Council of Economic Advisors (under Ronald Reagan), concluded that "the marginal cost of government spending and taxes in the United States may be about $2.75 per additional dollar of tax revenue." As the late Nobel economist Frederick Hayek said, "There is only one problem with socialism. It does not work."

The cost of universal service for one year would not be $80 billion, with certain additional economic benefits, as Litan would have it, but roughly $120 billion, with considerable additional losses to the economy as a whole."

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