Re: Military sizes. I understand Xen's frustrations with preposterous military numbers, but understand that you can't just copypaste real world troop numbers into Eras and expect it to work. Yes, IRL most countries do have armies numbering only in a few tens of thousands or a couple hundred thousand at most. But you have to know /why/ that is. In the present day on Earth, there is no /need/ for modern armies numbering several hundred thousand or even over a million...at least not for now... The modern military is typically used in international policing and peacekeeping operations, and besides that, most of those countries have the US, Russia or China as allies in case of attack (I will not comment on how that may change in the future aside from acknowledging that possibility). Huge militaries are very, very expensive, and if there is no pressing need for it, then slash the budget and put that into government programs or tax cuts.
However, were those countries to be attacked, they would be crushed very quickly. Against one of the big three (China, Russia, USA), 100 thousand men equipped with less than a hundred tanks, a couple hundred APCs, and an entire air force that could fit on a Nimitz-class aircraft carrier with room to spare, is completely, thoroughly, utterly inadequate. It'll do some damage and maybe hold a couple major cities before being wiped out, and that's about it. Getting into the low hundreds of thousands will fare far better, but they'll still be vulnerable to obliteration without international support.
Real-world militaries are as small as they are because the high costs of maintaining a huge force (e.g Canada used to maintain an aircraft carrier and a navy that dwarfed the Kriegsmarine, but no longer maintains more than a handful of frigates in the present) do not outweigh the benefits of added protection against threats that do not (or did not) exist. On Eras...it doesn't work that way. While there are a few fractional alliances and defence agreements (NWU, PU, Pax Latina, Trillium, META), none of them are perceived to offer sufficient protection to justify huge post-Cold-War-style RIF cuts versus the potential benefits of lower taxes, lower deficits and more social services. Whether this is actually the case isn't necessarily important; the members of those alliances do not want to dump their militaries and offload invasion protection to the other members of the alliances (which is actually a serious problem with NATO, as most of its members have cut their militaries so thin that without Uncle Sam they'd be useless against a possible Russian or Chinese attack). The end result of this is that everyone (except Xen) sees the need to build as large a military as they can sustain, and TBH I actually agree with that sort of thinking given the sheer number of wars Eras seems to be so prone to.
THAT BEING SAID, I do think there needs to be a reasonable limit on how large a military any nation would have. 2% has been described, but that's actually /massive/. Like, last-ditch effort in a total territorial invasion massive. 1% would be a more realistic point, although 0.5% would be a decent target for hardcore realism. The key here is that they're percentages, not definite numbers. My nation, Sasten, could equip an army of 1.7 Million with an enlistment rate of ~0.9%. This is still very high, but is reasonably in line with other Erasian countries. Even still, I'd be hard pressed to supply that with less than 20% of my budget, though I could possibly do it on non-major-procurement years given that Sastennic taxes are so high and tax avoidance and evasion being lower than average due to a dedicated (and terrifying) tax collection service and the unusually...lethal consequences that not paying your taxes entails. Smaller countries just shouldn't be able to have such large militaries. A nation like say...Demescia, were they to field 1.5 million active-duty personal, would be using more than 2.16% of their total population. It's...possible, but not sustainable, and their budget wouldn't be able to accommodate modern equipment and training without extremely high taxes, huge deficits, or deep service cuts.
This is also one of the problems with limiting nations to a "realistic" population size. During a war (which rightly or wrongly is the most popular type of RP on NS), everyone wants to emulate either the US or Russian/Soviet militaries, and with good reason; they had the best equipment, coolest tanks, most badass navy ships, and a full-on battle between them would be far more epic and world-war-like than a clash between, say, Canada and Australia. That sort of military, however, is not sustainable by a mid-sized country, which is what most people go for when told to keep a "realistic" population.
Essentially, the problem boils down to a difficult-to-reconcile conflict between having a big military and a reasonable population, and the impasse can only be solved by making the nation bigger, which nobody will recognize, or shrinking the military, which nobody will do.