Those of you who read Mike Green's post this morning and who have followed the coverage of US Defense Secretary Chuck Hagel's budget bid will understand that this is not the last word on the US defence budget. Congress will try to fight some of the cuts, the sequester may impose further cuts, and as Mike noted, the next president will also determine the long-term picture.

For now, though, the downward trend in US defense spending seems well established, with cuts coming every year since 2010, and more on the way. As this article says, further personnel cuts to the US Army are likely (which means more misleading headlines about the US military being cut to 'pre-World War II levels').

What's more, as Interpreter readers learned back in October last year through this interview with US defence budget specialist Todd Harrison, by historical standards the Pentagon has several more years of cuts ahead of it. Here's the key graph from Harrison's recent study; note the peaks during Korea, Vietnam, and the Reagan-era Cold War build-up, followed by years of decline. There's another peak during the war on terror, but by historical standards the budget has not bottomed out yet:

What does all of this mean for Australia and the Asia Pacific?

Mike Green argues that Hagel's budget leaves the credibility of the Obama Administration's pivot intact. And it is true that the US military remains incredibly powerful. As the BBC points out, Washington maintains by far the most capable and well funded military organisation in the world.

But the US is also unique in being the only country to claim and exercise truly global military reach and responsibilities. So its not terribly meaningful to compare US defence spending to that of China, because the latter is an Asia Pacific force with (at present) no pretensions to matching such capabilities.

But it does increasingly have the capability to deny the US the control it has exercised over the Asia Pacific maritime domain. And that, as Mike Green points out, is probably why the US is maintaining its production of submarines. Along with the cuts to the Ticonderoga-class cruisers, this can be seen as an acknowledgment of the growing vulnerability of surface ships to China's vast array of anti-ship capabilities, and of America's strong lead in sub-surface capability.