Peace dividend was a political slogan popularized by US President George H. W. Bush[1] and UK Prime Minister Margaret Thatcher in the light of the 1988–1991 dissolution of the Soviet Union, that described the economic benefit of a decrease in defense spending.
The term was frequently used at the end of the Cold War, when many Western nations significantly cut military spending such as Britain's 1990 Options for Change defence review.
[2] A political discussion about the peace dividend resulting from the end of the Cold War involves a debate about which countries have actually scaled back military spending and which have not.
On contrary, the fall of the USSR allowed the US to look for new external wars[5] to justify the desired military spending at home.
Over time, from the beginning of the Cold War to the present, the defense aspect has played a smaller or larger part of society, fluctuating according to different conditions.
[6] European nations were sharply criticized by a December 2023 Wall Street Journal article for the lack of progress on arming themselves since Russia's invasion of Ukraine in 2022.
Examples it gave were Denmark having no heavy artillery or air defence, France only having 90 howitzers and Germany only having 2 days of ammunition stored.
[13] While some countries in Europe, such as Finland, did not abolish its conscription and bought many weapons from the disarming nations, such as M270 and Leopard tanks from the Netherlands.
The report noted there is an East to West divide, countries closest to Russia increasing spending the most in general.
[25] Explaining that "Protection against external threats is a public good—and one of the core tasks of a state" ... "Maintaining an armed force, however, is expensive.
[32][33] While EconoFacts questioned what the current defense budget is spent on, including that the peace dividend has caused a lowering of military spending from 6% of GDP to 3%.
[36] While other opinions stay more true to the original definition and express worry about; "This reprioritisation of government spending could hurt Western living standards, including Australia’s.
The absence of the peace dividend could hit the funding of education, health, lower taxes, the transition to a greener economy, housing and so on, as pressing needs other than defence are pushed to the side.
"[37] With others being worried about the peace dividend being to strong in Australia in light of recent world events following the Dissolution of the Soviet Union.
Stating: "Indeed, it is now well recognised that the Australian Defence Force is in a position similar to that of a decade ago, with little progress made in the way of new capabilities being delivered to the ADF" and highlighting the changing times and that Australia should do more in the defense space.
[41] While further commenting on the aftermath of the Battle of Kadesh; "Ramesses II’s strategic aims, the standoff and cessation of hostilites did at least allow him to reap a peace dividend.