Abstract: The next American president will face a daunting list of national security problems, including a serious defense budget crunch. The budget crisis will be deepened by the global financial crisis, a tapering of supplemental funding associated with the wars in Iraq and Afghanistan, and the steady growth of military healthcare and other personnel costs. After six years of rapid defense budget increases, the Pentagon has lost the practice ofmatching strategy and resources. The next president will need to manage risk among investments in irregular warfare, counterterrorism, balancing new super powers, countering weapons of mass destruction, and traditional warfare. He will also need to begin to build non-military ‘‘soft power’’ capabilities outside of the Pentagon.