Jeffrey Grey is a Professor of History at the University of New South Wales, Canberra (ADFA), and foundation Director of the Australian Centre for the Study of Armed Conflict and Society.

Democracies display a lamentable inclination to believe in 'peace dividends' and to retrench military establishments savagely not only after major wars (when there may, arguably, be a short-term rationale for doing so), but in periods of domestic and international political confusion when the tea leaves are difficult to read.

The victorious allies were absolutely correct to demobilise the massive wartime forces with which they had defeated the Central Powers in 1918 – socio-economic factors alone dictated this. The British Government may have been justified in introducing the 'Ten Year Rule' in 1919 ('the British Empire will not be engaged in any great war during the next ten years Expeditionary Force will be required'); its use to derail force modernisation (not expansion) of the fleet in 1925 was certainly abuse of its intent, and the decision in 1928 to acquire a 'rolling' end-date (renewable and extendable each year thereafter) was quickly demonstrated to be seriously flawed.

The Attlee Government adopted a version of the Ten Year Rule again in 1946, for understandable reasons given the economic situation Britain faced at the end of the Second World War, but was forced to abandon it by the deepening of the Cold War in 1950-51.

So much for our track record in predicting the likelihood and shape of future conflict: ten years after the original Ten Year Rule was abandoned in 1932, Britain and the empire were deep in the third year of the Second World War, a struggle for survival, while the re-introduced Rule in 1946 did not last even half of its allotted span before being junked by circumstances that were predictable at least as early as 1947.

There are two problems with imposing a 'boom-or-bust' cycle on the armed forces. The first is the loss of capabilities that drastic reductions bring directly and inevitably in their wake. 'Planned' reductions — in the sense that these are managed on a rational basis with a clear understanding of their likely impact — are rarely anything of the sort. Once lost, capabilities are difficult and expensive to reacquire assuming, of course, that the strategic situation allows us the luxury of time to do so.

Equipment is part of capability but it is not a synonym for it. As James Goldrick has pointed out on The Interpreter, 'the sort of "train spotting" which sometimes accompanies discussions about equipment and platforms, particularly jet fighters' adds nothing very much to consideration of the defence options we face and must choose between.

The second deleterious effect is largely unquantifiable but all too apparent to observers, at least in hindsight. The human capital of the armed forces is more than the sum total of the wages bill. Savage cuts in personnel numbers of the kind likely to be imposed on the army, the most manpower-intensive of the three services, degrades not simply our capacity to do things but our knowledge and understanding of how to do things. The economic historian George Peden has noted that the original Ten Year Rule was not intended 'to hamper the development of ideas' in the interwar British Army, but a climate of relentless resource deprivation had precisely that effect not only on the services but upon industry as well, which when war came in 1939 was simply not able to meet the requirements for expanded production with the rapidity that decision-makers in the 1920s had assumed.

Nor do those outside the services really appreciate just how complex human military systems are, nor how long it takes to acquire real capacity in them. In reflecting on the first 18 months of the First World War the British Official Historian, Brigadier Sir James Edmonds, noted the real lesson of the war: raising and fielding effective infantry battalions was the task of months, but effective Staffs were the product of years, and it was inexperienced and deficient staff work that explained many of the operational difficulties and disasters encountered in the course of that year, and beyond.

Australian defence policy is too often the victim of bad national habits of mind, and of too many cosy assumptions uncritically acquired. Australians are not natural soldiers (any more than anyone else), and the ability to train, command, plan and administer in war is learned and taught, something which takes time.

There are two words that ought to be sufficient to deter attempts to erode further the already badly-diminished resource base of the ADF: East Timor. To understand their full import, it is first necessary to dispense with the self-congratulatory rhetoric which accompanies public consideration of the operations in late 1999 and recognise just how near-run a thing INTERFET was, and that responsibility for that parlous state of affairs lay firmly in the squeezing of service budgets and 'peace dividend' assumptions prevalent in the 1980s and for most of the 1990s.

Photo by Flickr user Son of Groucho.