This is just my opinion as a humble civvie. Firstly, i think defence spending comes pretty low on the list when you ask joe public about their main concerns for the country (so it isn't really an election winner). The public's concern (and anger) about being heavily involved in Iraq seems to be more of a question of whether it was illegal or not, rather than troops being killed or a lack of equipment.
Previous Labour heavy defence cuts happened when the economy was strong and buoyant, so i dread to think what future defence cuts are going to be like when you consider the economy is looking fragile and nervous (i think a lot of stealth cuts could be on the cards). What would lose the Government more votes: closing a few a&e wards or scraping a few tornado squadrons (doubt the latter would even make the local paper)? Also, the welfare budget is going through the roof and someone has just used my money to buy a bank i didn't want (me,me).
We still seem to live in a "me, me" country where if it doesn't effect No.1 then i don't really care.
I really think that we are at the beginning of the end in being heavily involved at the cutting edge in wars like Afghanistan, etc. I'm sure we will start to slowly turn around into a more French and German way of doing things through NATO, rather than being little brother to the US, when the time arises...e.g not straying into southern Afghanistan and not committing too much. Even more reason to cut back.