It's an understandable decision given historical context. Mon Mothma lived through the Clone Wars and saw what happens when a Republic gives too much power to the military. More over the New Republic needed to prove to it's members and any potential hold outs that it wasn't going to just become another Empire. It would be foolish, naïve and arrogant to presume that won't happen
"because we're the good guys!"
The galaxy had been at war and under military occupation for going on three decades. It needed to end.
Leia's position is also understandable in that the threat could out there and they couldn't afford to be so complacent.
Ideally there should have been more of a middle ground approach; galaxy-wide disarmament and force reduction leaving only a small naval force that would act as a significant deterrent to any would-be warlord, but not enough that it could be used to occupy or blockade, all while setting up a smaller, leaner trouble shooting task force to look for trouble in the border systems and deal with them before it gets out of hand.
Who knows, maybe in the early years that's just what happened, but over the *decades* they just got complacent. Such is the nature of politics and compromise; "why are we spending a third of the budget on Incom's new model fighters and yet more Starhawks when half the mid-rim is still on rationing?!". And to be fair:
"a massive fleet and army of kidnapped children being built and trained in uncharted space led by a giant wizard in a gold dressing gown, who's really a puppet of the old resurrected Emperor" certainly sounds like some crazy, conspiracy theory bantha crap.
It's also worth baring in mind that in the thousands of years of history, there had probably NEVER been a mass invasion from outside of settled space. All of the various wars were expansionist small powers, coups and internal civil wars. Even the Sith take over and the fall of the Old Republic probably fell into that category.
The idea that a massive fleet would just pour out of the Unknown Regions would sound as outlandish as us being worried about an invasion from the moon...
It would be like Britain standing down its armed force in WW2 just cause we won the battle of Britain stopping a invasion. Forgetting there is still a continent of fascists still with guns pointed.
No it would be like stepping down after the defeat of Germany and the Japanese surrender...we pretty much did. National service (and rationing, incidentally) went on for a bit to keep the numbers stable in the reconstruction period, but almost right after VJ day the was a mass demobbing of squaddies.
You can't maintain a military of that size indefinitely; our economy was already on it's knees, supply chains stretched beyond the breaking point, and we were already so financially in debt to the US that we'd spend the rest of the century paying it off. You think we dismantled the Empire and founded the Commonwealth in the 50's out of the kindness of our hearts? Fuck no. There was no choice. It was a case of disarm or die.
We didn't abolish the military obviously, but we reduced it to a level where we'd only have to worry about defending the UK, our slice of West Germany and a handful of overseas territories, as opposed to pre-war which was basically two thirds of the planet!