Some argue that high US military spending allows other nations to spend less. But this view seems to change the order of historical events:

* During the Cold War, high spending was common around the world.
* High spending was reduced by allies such as various European and Asian countries as the Cold War ended (almost 2 decades ago) not because other nations felt they would be protected by the US — a dangerous foreign policy choice by any sovereign nation to rely so much on others in this way — but because they perceived any global threat from the Cold War had diminished and simply didn’t need such high spending any more; globalization of trade was supposed to be ushered in and lead to a new era.
* It was only the US as the remaining global super power that maintained a high budget. Many argue this was to strengthen its position as sole super power and that its “military industrial complex” was able to convince their public to maintain it.

Past empires have throughout history have justified their position as being good for the world. The US is no exception.

However, whether this global hegemony and stability actually means positive stability, peace and prosperity for the entire world (or most of it) is subjective. That is, certainly the hegemony at the time, and its allies would benefit from the stability, relative peace and prosperity for themselves, but often ignored in this is whether the policies pursued for their advantages breeds contempt elsewhere.

As the global peace index chart shown earlier reveals, massive military spending has not led to a much global peace.

As noted in other parts of this site, unfortunately more powerful countries have also pursued policies that have contributed to more poverty, and at times even overthrown fledgling democracies in favor of dictatorships or more malleable democracies. (Osama Bin Laden, for example, was part of an enormous Islamic militancy encouraged and trained by the US to help fight the Soviet Union. Of course, these extremists are all too happy to take credit for fighting off the Soviets in Afghanistan, never acknowledging that it would have been impossible without their so-called “great satan” friend-turned-enemy!)

So the global good hegemon theory may help justify high spending and even stability for a number of other countries, but it does not necessarily apply to the whole world. To be fair, this criticism can also be a bit simplistic especially if an empire finds itself against a competitor with similar ambitions, that risks polarizing the world, and answers are likely difficult to find.

But even for the large US economy, the high military spending may not be sustainable in the long term. Noting trends in military spending, SIPRI added that the massive increase in US military spending has been one of the factors contributing to the deterioration of the US economy since 2001. SIPRI continues that, “In addition to its direct impact of high military expenditure, there are also indirect and more long-term effects. According to one study taking these factors into account, the overall past and future costs until year 2016 to the USA for the war in Iraq have been estimated to $2.267 trillion.”

http://www.globalissues.org/article/75/world-military-spending#InContextUSmilitarybudgetvsotherUSpriorities