Financial crisis: Will it hit defence spending?

We are in the economic equivalent of a rolling national security crisis.

That's an interesting turn of phrase from the Prime Minister. Presumably this was Rudd's attempt to communicate the scale and urgency of the problem, though it's also a reminder that threats to national security aren't always physical. The government has committed itself to maintaining 3% growth in the defence budget to 2018, but there might be some nervous officers on Russell Hill today as they contemplate the future. The government wants to pump prime the economy with new infrastructure projects, and since most of our weapons are bought overseas, could the government consider cuts there in order to boost domestic spending?

UPDATE: A colleague notes that the fall of the Australian dollar will also hurt the Defence Department's buying power when it comes to US and European weapons.