Cost distribution theory suggests that the costs to the median voter in a democracy of fighting an insurgency with firepower are relatively low compared to a more labor-intensive approach. Therefore, this voter will favor a capitalintensive counterinsurgency campaign despite the resulting diminished prospects of victory. Primary and secondary sources show that President Lyndon Johnson and his civilian aides were very much aware that, although they considered a main force—focused and firepower-intensive strategy to be largely ineffective against the insurgency in South Vietnam, it was politically more popular in the United States. Importantly, civil-military agreement on warfighting strategy does not undermine this explanation, which assumes that civilian leaders, and ultimately the public, play an essential role in that strategy's determination. Appointing and supporting Gen. William Westmoreland was just one means by which the Johnson administration ensured that the U.S. military emphasized the fight against conventional enemy units and relied on the use of firepower for the fight against Vietcong insurgents. Civil-military disagreements over strategy, however rare, therefore provide the essential test of cost distribution theory's explanatory power. When officials suggested that the U.S. military adopt more labor-intensive pacification approaches to fight the insurgency, the Johnson administration rejected them.

A capital- and firepower-intensive military doctrine is, in general, poorly suited for combating an insurgency. It is therefore puzzling that democracies, particularly the United States, tenaciously pursue such a suboptimal strategy over long periods of time and in successive conflicts. This tendency poses an empirical challenge to the argument that democracies tend to win the conflicts they enter. This apparently nonstrategic behavior results from a condition of moral hazard owing to the shifting of costs away from the average voter. The voter supports the use of a capital-intensive doctrine in conflicts where its effectiveness is low because the decreased likelihood of winning is out-weighed by the lower costs of fighting. This theory better explains the development of the United States' counterinsurgency strategy in Vietnam during Lyndon Johnson's administration compared to the dominant interpretation, which blames the U.S. military's myopic bureaucracy and culture for its counterproductive focus on firepower and conventional warfare.