It really depends. When that quote of yours was first being said, essentially the only way for states to expand their power was to invade and occupy more territory. So states that did a lot of that tended to become more powerful, leading to a very warlike normal.
Nowadays, even radically successful wars are very unreliable means for achieving anything, and wars almost never improve a state's economic situation or power. If Germany had not started WW2, but had instead rested on its greater population and industrialization to increasingly dominate regional politics, you'd see a europe like the one we have today, except even more Germany-centric.
Saddam Hussein, Vladimir Putin, and Adolf Hitler are all examples of weak leaders at the helm of fragile states, throwing the dice repeatedly and basically hoping they get a continual role of sixes until their domestic position is secure. Predictably, it basically never works out. There are almost no examples of successful annexations in today's world: gains are typically temporary, and basically never pay for themselves.
So in the world we live in, where war is basically never a sensible strategy for any goal, you can prepare for peace by, you know, preparing for peace - provided that you have no nutso neighbors. In which case, it's worth joining some kind of joint treaty organization. Which is why everybody does this.
PS: A second thing is, it's no use having a ton of outdated equipment. The USSR had a lot of trouble in WW2 because they had been arming up for too long. It's often better to move to a war footing just a few years before things get hairy than it is to keep massive amounts of obsolete weaponry sitting around.