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War Costs at $904 Billion: CSBA

How much have we spent on the wars in Iraq and Afghanistan? The answer is $904 billion, according to a new report by Steven Kosiak, the renowned defense budget number cruncher at the Center for Strategic and Budgetary Assessments, in Washington, D.C. A rough projection of future costs, assuming combined troop levels in Iraq and Afghanistan drop from the current 200,000 to somewhere below 75,000, estimates the federal tab for the wars will climb to $1.3-1.7 trillion by 2018.

Waging war today is a far costlier endeavor than past U.S. military operations; the U.S. has already spent 50 percent more fighting in Iraq and Afghanistan than it did in the Vietnam War. The reason today’s wars are more expensive is largely due to rising personnel costs, including salaries and benefits, and pricier equipment, such as night vision and body armor. Kosiak cites a recent Congressional Budget Office estimate that pegs the costs per troop/per year at $750,000.

Most of the money for the wars, $509 billion, has gone into DoD’s operations & maintenance accounts, as would be expected. Around $190 billion has gone to procurement, to buy more ammunition, better equip troops going into combat, upgrade existing equipment, and accelerate production of “next-generation” weapons that have long been on service wish lists. That money has come from the emergency wartime supplementals that Congress is determined to pare back.

“There is no way to easily or precisely estimate how much funding for weapons procurement included in recent supplementals might be reasonably attributed to the wars in Iraq and Afghanistan, and how much might be more appropriately attributed to the Services’ long-term modernization requirements.” The amount of money going into the latter category has increased dramatically over the past four, and especially the last two, years, Kosiak says.

That increase comes from an increasingly expansive definition of what is included in the military’s “reset” program, intended to repair and refurbish war-worn equipment, Kosiak says. “Over the past several years, far more has been requested and provided for procurement and reset than either DoD or CBO estimates suggest is needed to simply cover equipment replacement and repair costs.” Reset money has been used to fund new programs such as the CV-22 Osprey and the F-35 Joint Strike Fighter.

Has spending on the wars hurt the U.S. economy? The short answer is no. Kosiak says the current wars have been less burdensome, as a percentage of GDP, than either Korea or Vietnam. The national debt stands at $10 trillion. Assuming the wars have been financed entirely by borrowing, they still account for less than 10 percent of total national debt.

In an era of $700 billion financial system bail-outs and discussions of $1 trillion and larger fiscal stimulus packages, spending nearly $1 trillion to wage a war that is entering its eighth year may appear to many as not all that unreasonable.

But what if the American people are forced to make a choice on either funding distant and bloody wars or spending government funds here at home to resuscitate a moribund economy? For the past eight years they haven’t had to make that choice as the economy boomed. That was then and my how things have changed.

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