While the United States took advantage of its nuclear arsenal to help reduce the size of its conventional forces, it never went quite as far as it could, and still had millions of soldiers and hundreds of ships deployed during the Cold War. The Soviet Union, PRC, and now the DPRK still deploy massive conventional forces in addition to their nuclear forces.
How plausible would it have been for the Cold War to have seen defense budgets of around 3% or even 4% of GDP, around half as much as historical spending? How much would the economies of the nuclear powers be improved by having resources and manpower freed up for the civilian economy?