The Project on Defense Alternatives has a nice item on the defense spending surge. This chart sums things up the best:
The wave-like shape of the historical trajectory is what’s really noteworthy here. There’s been an effort underway to convince people that defense expenditures just naturally drift ever-upwards, but it’s not the case. There were specific spikes associated with the Korean War, the Vietnam War, and the beginning of Ronald Reagan’s administration. The current spike, allegedly, is all about the need to fight al-Qaeda. But it’s not as if 9/11 happened because they outspent us.