As if it wasn’t pretty obvious with the premature troop withdrawals from Iraq and Afghanistan, the latest plans announced by the Obama administration for a significantly smaller military send two very distinct messages: (1) a crass political choice to allow the entitlement regime to continue to crowd out defense spending and avoid a confrontation with the budget realities of Medicare, Medicaid, Social Security, and Obamacare and (2) a clear message that America is reducing its global standing and leadership a la Western Europe. Gone will be the capacity to engage two major war fronts simultaneously, and the projected spending levels as a percentage of GDP after the cuts will be at the level of 1940, not a very good year. The administration’s game attempt to characterize this decision as a “strategic shift” as opposed to a pullback was belied by Defense Secretary Leon Panetta’s demeanor and I think he knows that this is a major retreat.