To be fair, the current scope of government for most of the world is far beyond mutual defense at this point. Governments of the 19th and 20th Century also provided defense, and did so with a much smaller portion of GDP.
I think there's a pretty strong argument that global military is close to a zero-sum game, but I agree that this doesn't mean there is a obvious alternative.
Last, I think it's pretty indisputable that there's been significant scope creep given that western government taxation & spending are now pushing 50% of GDP. If you look at the US, the federal government was 2% of GDP in 1920, and closer to 25% today. This is despite 10x in inflation adjusted GDP per capita. This means that more realistically, government is consuming/directing 100x more productive capacity per person.