In short, stability in East Asia has played an important role in making it possible for that region to develop robustly growing economies and improving living standards. That economic growth/development has benefited the U.S., too. The U.S. has a major stake in ensuring such stability continues and the busy Pacific shipping lanes cannot be blocked by any single nation.
Another key interest involves a capacity to prevent a hostile state from dominating the Persian Gulf Region through which a disproportionate share of the world's present oil passes. That share will grow over time based on proved reserves and depletion in other parts of the world. Needless to say, a credible energy policy that seeks to move the U.S. and its allies away from reliance on oil for a large share of its energy needs would be a wise investment. The geopolitical and national security argument for such investment is a strong one.
Those are two examples. When one is evaluating the capabilities the U.S. needs, one needs to factor in the net benefits/opportunity costs associated with various capability options. A pure look at military spending as a percentage of GDP overlooks that broader context.
Personally, I don't know what level of reduction could be possible before each dollar of cost savings would yield adverse consequences (increased risk, adverse consequences from growing instability in key theaters, reduced deterrence, etc.,) that outweigh the financial savings. Only a robust and comprehensive examination would provide the proper details. My guess is that meaningful savings (perhaps on the order of 5% or more of annual national defense expenditures excluding costs related to the Afghanistan/Iraq military operations) probably can be derived without harming national security, but I can't put an exact number on it.Our current military spending almost equals the rest of the world combined. Why would cutting that spending by 50% hurt our defensive capability?
My point is that the U.S. military, even as it is expected to become more efficient and effective, needs to be sustained at a level whereas the U.S. is able to preserve/advance its critical interests.