The military argument is based solely from a domestic defense perspective and on a few assumptions:
1. Our one and only neighbor is friendly (and very strong)
2. If there was a problem, our neighbor and friend would help
With these in mind, we don't need a strong military fully capable of defending our borders. We could then channel those dollars that would be needed otherwise into economic development. Korea's situation is different in that they have a hostile neighbor but a strong friend. In both cases, however, Canada and Korea were (are) able to focus more on development.
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