Just as important, the amount of defense you buy should be a function of what threats you're dealing with. 2014 is not the same as World War II.
Actually, it's worse in terms of cost. In pre1950s America, we weren't required to police the world or otherwise maintain a global military presence. We could reduce spending, but only if you're willing to let the Middle East fight it out without our interference (which is a valid isolationist stance, but not one most politicians here support).
The cost of that hardware (per unit of military usefulness) has gone down, and we're more efficient than we ever were before, so I'd expect the cost of a unit of defense to be a lot lower than it was in the past.
That's simply not true. As technology has advanced, and the threats have increased, the cost of "staying ahead of the curve" and responding to those threats has spiked significantly.
If Iran was a military superpower, we'd likely spend more.
There are more countries today verging on superpower than back when we only had the russians to worry about. At a minimum, there's Russia -and- China, and China has the leg up in both population and economic growth. Using the historical comparison, we should be spending more (or at least the same) than we were then.
Does comparing the size of our military to the size of the militaries we might fight with really not make sense to you, or are you just playing dumb?
Spending isn't a factor of army size alone. It drives innovation and new technology. Right now we're ahead because we spend to stay ahead.