I have two points to make about this topic.
First, war should not be faught without all the might of a nation behind the war. To invest that much resource, there should be a very good reason to go to war.
For example, the war in Iraq. Supose for a minuet that we had a just reason to attack iraq. If we did, we should have held a draft, destroyed every threat avaiable, untill the country surreneder uncondisionally.
Then, for what ever reason we went to Iraq, would be delt with, (say nuclear weapons (yea i know he didnt have them) so we would find search all of iraq for WMD, destroy any. Then set up treaties with the country, saying they will not produces WMD, then place a goverment to see that the treaty is not broken, and leave.
The outline above is the only way our country should fight war.
Now, to unleash total war uppon another nation, we would need a darn good reason, such as genocide, against a people, AND a realistic and potenial threat against our country. Much like the japansee possed to us in WW2. The Japaneese killed over 11 million chinesse (that sounds like genocide to me) And launched a fairy strong attack against pearl habord, thus a realist threat to our country. We may also feel that we have this right to unleash such a war if the country in question was attacking our allies, such as canada.
If another country had done simliar things to japan, then we would have probable cause to attack them.
Second
No matter the size of there army or country, we should attack with no less then 150 million military people (hence airmen army men, marines, navy, Ext. Thats half of the popution of this country. While not all of those poeple would make up the front lines, those that where not of able body, such as those over 40, could drive trucks, operate tanks, ect. Those of combat age, 18 to 35, would make the magorety of the infantry.
Given this senario, there is no room for corperations. Corperations would essentually be comenderd to create supplies, weapons, ext.
The other half of the population would feed the war machine, and defend the soil of the country + make up all those unfit for war at all, the handy capped, wounded, or mentally unfit, or overage, 65+)
This in my opinion is the only way to fight a war. Swift crushing might, while the lagistics of such a war would be a nightmare, it would be possible.
The war in Iraq was basically over in the first few days, however, if 300,000 troops came into the theater every 3 mounths, (that is as supplies and training for them became avaible) there would be no insurgancy.
If we had 150 million people on the soil of iraq, there would be no terrorist there.
The only way to fight a war is with absoluatly crushing and unrentlous force.
Thus, there are very very few times to actually go to war.
In a war like this, there is no room for countractors, with 150 million americans in Iraq, the country would be rebuilt in a matter of weeks, probably to a standard never seen before. Local economy would sour (150 million solders must eat, the local farmers would be strentched to the limits to feed them, as would our supply lines. Soliders bring money, they often drink, this builds more econimic infanstructure, soon Iraq would be a nice country. However the culture would be destoryed, such is the cost of war.
The cost to america would be great, but with the unconditional surrender of a country, we could imposs trade with them. Once our troops leave they would need many things, and we could supply them with that. We could also take there reasources if we so felt inclinded.
I stress again war should only be fault in the direstest of situations.
Anyway, short answer the military should not be outsourced.