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The Terran Republic is all about power and dominance, the two most dominate symbols of power for a military government are superior firepower and heavily armored machines rolling down the streets and running over your children.
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I actualy agree with you on this. However, if they did increase the armor, I belive they would need to decrease the maximum speed and handleing as well in order to maintain balance.
It makes sence that the tank with a 3-man crew would have both more firepower and more armor, but wouldn't be as powerful.