ASG Blog
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Tracking Hidden War Costs
Published: February 22nd, 2012
Mary Kaszynski
Afghanistan Study GroupHow much have the wars in Afghanistan and Iraq cost the American taxpayer? It seems like an easy question. Add up all those supplemental war appropriations from the Bush years and the overseas contingency operations, and you should have the answer.
It’s not that simple. The US invaded Afghanistan in October 2001. More than ten years later, we’re still at war, and we still don’t know how much we’ve spent on it. That says something about the Pentagon’s accounting practices—the Department of Defense still can’t complete an audit—and the way we budget for war in particular. Most importantly, it says something about accountability and transparency in government spending in general.
We recently tried to add up America’s war bill and encountered some difficulties just trying to get the right number. We looked at various agency budgets to locate line items that contribute to the cost of war in Iraq and Afghanistan. Our hope is to demonstrate that arriving at a firm number is a herculean task.
Defense War Budget – the primary costs of war should be in the Department of Defense Overseas Contingency Operations (OCO) account. However, all war costs are not in the OCO account – and everything in the OCO account is not for the war. Included in OCO is the cost of the military “reset”, which allocates monies for repairing and restoring equipment used during the war.
How much of the reset actually has to do with the war is unclear. The Congressional Research Service estimates that more than 40% of what the Army calls “reset” is used for things other than repair and replacement.
Defense Base Budget – Sometimes non-war costs are moved from the base to the war account to evade budget caps. Sometimes it goes the other way; In this year’s budget the administration moved about $10 billion in enduring operations costs to the base budget.
It’s hard to estimate just how much of the base defense budget goes towards the wars. The defense budget, excluding war funding, has grown significantly since 2001, which shows that some portion of the base defense budget can be attributed to the cost of war in Afghanistan and Iraq. How much? Economist Joseph Stiglitz estimates at least 25% of the base budget increase is due to the wars (The Three Trillion Dollar War, page 46). With an increase of $670 billion since 2001 in the base budget, that would mean an additional $168 billion in war costs.
Other Agencies – Since 2001, CRS estimates that State and USAID have spent $67 billion in Iraq and Afghanistan. These agencies will take on more as combat operations wind down, and war funding reflects this. State’s 2013 request for OCO (a new account in 2012) is $8.2 billion.State’s OCO account may be small, but that doesn’t mean following the money is any easier. Take state money for Afghanistan for example. State OCO includes $3.3 billion for the war in Afghanistan.
Associated Costs – There is much more to paying for war than the costs of ongoing operations. One big associated cost is caring for veterans of Iraq and Afghanistan. The Veterans Affairs budget has grown significantly over the past ten years, and it will continue to grow long after the wars are over.The cost of caring for veterans is never included in the Pentagon’s war estimate, but full-cost analyses commonly take this into account. The projected total cost of veterans’ health care and disability is $422 billion to $717 billion, according to a recent study by the Center for American Progress. The 2013 VA request is $140 billion.
The wars in Iraq and Afghanistan are also a main driver of the national debt. In 2013, the payment on the national debt due to DOD war costs will be about $5.8 billion.* Stiglitz estimates that the wars are directly responsible for at least a quarter of the increase in the national debt – that’s over $2 trillion since 2003.
So how much have the wars in Iraq and Afghanistan cost? The Department of Defense war budget (supplementals plus OCO) totals $1.2 trillion since 2001. But as you can see, DOD OCO is just the beginning. Once you start adding in all the hidden costs, the total is much, much greater.
*DOD OCO is approximately 2.3% of total government spending (88.5/3800). Payment on the debt in 2013 is $248 billion. Assuming war costs account for the same percentage of debt as total government spending, we have $248B*2.3%=$5.7B. See Winslow Wheeler’s calculation for the defense budget and payment on the debt: “Which Pentagon Numbers Are Real? You Decide!” -
Afghanistan Weekly Reader: $97 billion for another year of war
Published: February 16th, 2012
The defense budget is driving the news this week. The president’s request for fiscal year 2013, unveiled Monday, includes $89 billion in war costs for the Department of Defense, plus $8 billion for State – a total of $97 billion. Problems with this number are already starting to pop up. Funding for inefficient and unsustainable infrastructure projects continues in the 2013 request, as does the Pentagon’s habit of hiding non-war costs in the war budget.
Defense Secretary Panetta expects an agreement on the US presence in Afghanistan in the next few weeks. That may help clear up some questions about future war costs. But if this year’s war budget is any indication, war spending won’t be going down anytime soon.
From ASG
2/14/12
Capping War Costs at Only $450 Billion
Afghanistan Study Group by Mary Kaszynski
The president’s budget proposes a $450 billion cap on war spending over the next nine years. This is a step in the right direction, but the proposed cap is far too high, leaving plenty of room for unnecessary spending.ARTICLES
2/10/12
Defense budget magic
CNN by Libby Lewis
Defense Secretary Leon Panetta hasn’t revealed much so far about his department’s budget proposal for the next fiscal year. But he has offered a peek at some numbers, like this one: $88.4 billion for war funding…The war is expensive, true, but some defense budget experts say there may be also be some defense budget magic going on. It’s a magic made possible by two things.2/12/12
Risks of Afghan War Shift From Soldiers to Contractors
New York Times by Rod Norlund
Even dying is being outsourced here.
This is a war where traditional military jobs, from mess hall cooks to base guards and convoy drivers, have increasingly been shifted to the private sector. Many American generals and diplomats have private contractors for their personal bodyguards. And along with the risks have come the consequences: More civilian contractors working for American companies than American soldiers died in Afghanistan last year for the first time during the war.2/15/12
Pentagon hides $3 billion in budget accounting maneuver
Foreign Policy by Josh Rogin
The Pentagon’s new budget request moves $3 billion of military pay and benefits out of the base budget into the war budget in an accounting maneuver experts and congressional staffers say is meant to get around legally mandated budget caps and bolster the administration’s plan to cut the size of the Army and Marines.OPINION
2/14/12
450 Bases and It’s Not Over Yet
TomDispatch by Nick Turse
Whether the U.S. military will still be in Afghanistan in five or 10 years remains to be seen, but steps are currently being taken to make that possible. U.S. military publications, plans and schematics, contracting documents, and other official data examined by TomDispatch catalog hundreds of construction projects worth billions of dollars slated to begin, continue, or conclude in 2012. -
Capping War Costs at Only $450 Billion
Published: February 14th, 2012
The president’s budget plan for fiscal year 2013, unveiled yesterday, includes $96.7 billion for war funding ($88.5 billion for the Department of Defense and $8.2 for State – see page 89 of the budget). The Afghanistan war accounts for almost all of the request – $88.9 billion.
While the numbers themselves are interesting (interestingly high, that is), even more significant is the administration’s proposal to establish a cap on the war funds account:
Leaving OCO [overseas contingency operations, or war costs] funding unconstrained could allow future Administrations and Congresses to use it as a convenient vehicle to evade the fiscal discipline that the BCA [Budget Control Act of 2011] caps require elsewhere in the Budget. With the end of our military presence in Iraq, and as troops continue to draw down in Afghanistan, this Budget proposes a binding cap on OCO spending as well. From 2013 through 2021, the Budget limits OCO appropriations to $450 billion. [Emphasis added. See page 26 of the president’s budget.]
Before diving into the implications of the proposed cap, a couple of notes. First, the debt deal left a loophole for war costs, and that that loophole must be closed if policymakers are serious about getting nation’s fiscal house in order. Second, this is a cap, not a request. So $450 billion over the next nine years is a maximum; costs may not get that high.
These caveats aside, take another look at the cap itself. The proposal would limit war costs to $450 over the next nine years, an average of $50 billion per year. That might seem like a good deal, until you remember that we have spent $570 billion on the Afghanistan war since 2001. Assuming most of the proposed $450 billion would be for Afghanistan, that would bring the cost of the war to over $1 trillion.
Remember too that the Pentagon has announced plans to transition to local security forces by mid-2013. If the US combat role ends in 2013, what could possibly account for $450 billion in war costs through 2021?
A couple of explanations come to mind. First, the drawdown plan for 2013 and beyond is still unclear. US troops’ combat role may be ending, but who knows how long the training mission will last, and how many troops will be left in Afghanistan to see it through. Estimates range from 5,000 to 30,000, according to Afghanistan’s former deputy interior minister.
The second explanation isn’t much better. Troop levels alone are unlikely to account for $450 billion, meaning there will still be plenty of room for shady budgeting. Federal budgeters intend to keep doing what they’ve been doing all along, hiding non-war costs in the war budget. This has happened before – in 2012 alone some $7 billion was moved from the base defense budget to the war account. And it’s likely to happen again, with a cap as high as $450 billion.
Capping war costs is a good step towards fiscal responsibility in the defense budget. But this cap still leaves plenty of room for unnecessary spending. More serious efforts to restrain spending are necessary.
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Afghanistan Weekly Reader: Another $88 Billion, For What?
Published: February 9th, 2012
Military leaders like to tell us that we’re making progress in Afghanistan. Some politicians and pundits say that if we just stay the course, leave the troops there, then we might “succeed.”
But it seems that the outlook in Afghanistan isn’t as rosy as we have been lead to believe. A new intelligence estimate calls the war a stalemate. A NATO report details pervasive corruption in Afghanistan. And now a US Army officer is speaking out about how what he saw in Afghanistan in no way matches what officials have been telling the American public.
As these facts pile up, it becomes harder and harder to justify the bloated war budget. $120 billion in 2011, $110 billion in 2012, and now the Defense Department wants $88 billion for war costs in 2013. We keep spending, but by all accounts we’re not getting much out of it. How much evidence do we need before coming up with a smarter strategy?
From ASG
2/7/12
Do You Want To Spend Another $88 Billion In Afghanistan?
Afghanistan Study Group by Mary Kaszynski
The price tag for the war in Afghanistan – $88 billion if the 2013 request is fully funded – will include a war that the majority of Americans do not support, plus some equipment that the Army doesn’t need, and who knows what else. The war may be winding down, but the Defense Department’s shady accounting practices continue, at the expense of the American taxpayer.ARTICLES
2/6/12
In Afghan War, Officer Becomes a Whistle-Blower
New York Times by Scott Shane
On his second yearlong deployment to Afghanistan, Lt. Col. Daniel L. Davis traveled 9,000 miles, patrolled with American troops in eight provinces and returned in October of last year with a fervent conviction that the war was going disastrously and that senior military leaders had not leveled with the American public.OPINION
2/2/12
Could and Should U.S. End Combat Role in Afghanistan Early?
PBS NewsHour Interview with
Gen. Jack Keane and Celeste Ward Gventer (University of Texas)
Gventer: I think we need to step back and ask the question, fighting season to fight for what, and who are we fighting, and to what end?…It’s not clear who our enemy is or what another fighting season or two more fighting seasons or 10 more fighting seasons is really going to achieve, at the expense of American lives and treasure.2/2/12
Romney Playing With Fire on Afghanistan
National Journal by Alex Roarty
Mitt Romney’s sharp criticism Wednesday of President Obama’s newly planned troop withdrawal in Afghanistan raises a thorny question for the presumptive GOP presidential nominee: Why is he intent on aligning himself with such an unpopular position? The answer might lie in a candidate willing to lose a battle to win the war.2/3/12
Afghanistan 2013: America’s Next Groove
The Atlantic by Steve Clemons
Former State Department official and US Marine Matthew Hoh, now a Senior Fellow at the Center for International Policy, and I had a very good discussion with Chris Matthews on MSNBC’s Hardball about Defense Secretary Leon Panetta’s comments that the US would cease combat operations in Afghanistan in 2013 — rather than the end of 2014. -
Do you want to spend another $88 Billion in Afghanistan?
Published: February 7th, 2012
