"The tension between these conflicting aims is perhaps particularly acute in the late twentieth century because of the publicity given to the existence of various alternative “models” for emulation. On the one hand, there are the extremely successful “trading states”—chiefly in Asia, like Japan and Hong Kong, but also including Switzerland, Sweden, and Austria—which have taken advantage of the great growth in world production and in commercial interdependence since 1945, and whose external policy emphasizes peaceful, trading relations with other societies. In consequence, they have all sought to keep defense spending as low as is compatible with the preservation of national sovereignty, thereby freeing resources for high domestic consumption and capital investment. On the other hand, there are the various “militarized” economies—Vietnam in Southeast Asia, Iran and Iraq as they engage in their lengthy war, Israel and its jealous neighbors in the Near East, and the USSR itself—all of which allocate more (in some cases, much more) than 10 percent of their GNP to defense expenditures each year and, while firmly believing that such levels of spending are necessary to guarantee military security, manifestly suffer from that diversion of resources from productive, peaceful ends. Between the two poles of the merchant and the warrior states, so to speak, there lie most of the rest of the nations of this planet, not convinced that the world is a safe enough place to allow them to reduce arms expenditure to Japan’s unusually low level, but also generally uneasy at the high economic and social costs of large-scale spending upon armaments, and aware that there is a certain trade-off between short-term military security and long-term economic security."