Purchasing Firepower Parity

Not intended as a criticism of Matt Yglesias’ post, but a genuine question. You see the claim often made that the United States spends more on defense than the next 10 countries combined, or something like that. How are these comparisons made? In dollars? At what exchange rate?

It seems to me that we really want to know two things: first, how much we’re spending; second, how much we’re “getting” for that spending. Some of the latter is hard to measure, but the military already tries to do it, comparing the value of one of our tanks versus one of theirs, one of our airplanes versus one of theirs, etc. So it should be possible to use these kinds of metrics to get some kind of “purchasing power parity” equivalent for comparing military “output” across nations.

You certainly can’t reduce questions like “do strategic nuclear weapons have any real defense value” or “how much is it worth to preserve our submarine-building capability” or “which is worth more: a new stealth bomber or a new Special Forces unit” or “how much recruiting and retention benefit do we gain from a given increase in spending on veterans” to one metric. But you could at least reveal how much of the difference between, say, Chinese and American military spending is due to lower labor and manufacturing costs in China, how much is due to superior American technology and human capital, how much is due to specific American and Chinese decisions about the nature of our force posture (driven by any number of factors including different demographics, different missions, different internal political dynamics, etc.), and how much is due to us just wanting (or believing we need) a bigger boat.

Like I said: an honest question. Anyone know how the numbers that are usually bandied about are calculated? Anyone know if a military equivalent of purchasing-power-parity comparisons is also flying about?