Iraq and Afghanistan wars may total $2.4 trillion

Today at 10:00 a.m. the House Budget Committee is holding a hearing entitled, “The Growing Budgetary Costs of the Iraq War.” Dr. Peter Orszag, Director, Congressional Budget Office, Amy Belasco, Congressional Research Service and Professor Linda Bilmes, John F. Kennedy School of Government, Harvard University will be testifying.

Iraq and Afghanistan wars may total $2.4 trillion
Ken Dilanian, USA TODAY – October 24, 2007

WASHINGTON — The cost of the wars in Iraq and Afghanistan could total $2.4 trillion through the next decade, or nearly $8,000 per man, woman and child in the country, according to a Congressional Budget Office estimate scheduled for release Wednesday.

A previous CBO estimate put the wars’ costs at more than $1.6 trillion. This one adds $705 billion in interest, taking into account that the conflicts are being funded with borrowed money.

The new estimate also includes President Bush’s request Monday for another $46 billion in war funding, said Rep. John Spratt, D-S.C., budget committee chairman, who provided the CBO’s new numbers to USA TODAY.

Assuming that Iraq accounts for about 80% of that total, the Iraq war would cost $1.9 trillion, including $564 million in interest, said Thomas Kahn, Spratt’s staff director. The committee holds a hearing on war costs this morning.

“The number is so big, it boggles the mind,” said Rep. Rahm Emanuel, D-Ill.

Sean Kevelighan, a spokesman for the White House budget office, said, “Congress should stop playing politics with our troops by trying to artificially inflate war funding levels.” He declined to provide a White House estimate.

The CBO estimates assume that 75,000 troops will remain in both countries through 2017, including roughly 50,000 in Iraq. That is a “very speculative” projection, though it’s not entirely unreasonable, said Loren Thompson, a defense analyst at the non-partisan Lexington Institute.

As of Sept. 30, the two wars have cost $604 billion, the CBO says. Adjusted for inflation, that is higher than the costs of the Korea and Vietnam conflicts, according to the Washington-based Center for Strategic and Budgetary Assessments.

Defense spending during those two wars accounted for a far larger share of the American economy.

In the months before the March 2003 Iraq invasion, the Bush administration estimated the Iraq war would cost no more than $50 billion.

You can watch the hearing live via webcast: High Bandwidth or Low Bandwidth (Audio Only).

$2.4 trillion is enough to:
· Provide every college freshman in the country with a free, four year education at a private college or university
· Provide health care coverage to every American for one year
· Pay off 26% of our current national debt 

Chairman John Spratt gives opening remarks:

Chairman Spratt: “The cumulative cost by 2017 could be an astounding $1.7 trillion. While these costs are enormous, they omit any calculation of interest on the funding borrowed for war operations. And since the government has run substantial deficits from 2003 through 2007, and since future borrowing to some extent can be expected, interest needs to be imputed to the total cost of the war. This expense, as I said, has previously been omitted, but if included, according to CBO, interest cumulatively could be as much $705 billion by 2017. Added to direct costs… the total cost could reach $2.4 trillion by 2017.”

Chairman John Spratt questions CBO Director Dr. Peter Orszag on whether the Department of Defense has challenged the CBO’s calculations previously:

Chairman Spratt: “Have you, in the past when you’ve done this, received any criticism from the Department of Defense, or have there been specific objections made to specific forecasts that you’ve produced by DOD?”
Orszag: “To my knowledge, there was one incident in which there was some criticism, but I believe that the facts have proven us to be correct, and that had to do with the size, and therefore the cost of the so-called surge that has occurred this year. We put out an analysis earlier this year trying to delineate the potential size of that given the number of brigades that the Administration had identified as being involved in it, and there was some Administration criticism of those figures. But as the facts have turned out, I believe our analysis has proven to be correct.”

Rep. Lloyd Doggett (TX-25) questions the curious absence of Republican Members of Congress at the hearing:

Rep. Doggett: “I assume, by Mr. Ryan being here, that every member of this panel, including every Republican member on that side of the aisle where all the seats are vacant, received notice about this hearing about the cost of war in Iraq?”
Chairman Spratt: “I’m sure they did.”
Rep. Doggett: “And when was this notice of the hearing sent out?”
Chairman Spratt: “Seven days ago, as required by the rules.”

Rep. Lloyd Doggett questions CBO Director Dr. Peter Orszag:

Rep. Doggett: “I’m sure you recall that when the President’s top economist, Lawrence Lindsey, suggested that perhaps the initial White House figure of $50 billion for the total cost over all time for the war in Iraq might be off a little bit, they found him another job outside the administration. If I understand the burn figures, as they’re referred to, presently, we currently spend in about four months in Iraq what the White House told the American people initially would be the cost of the total war. Is that about right?”
Orszag:“We’re spending roughly… $11 billion a month”
Rep. Doggett: “We had an estimate of $12 billion from witnesses this summer from the Pentagon, but perhaps five months, or almost five months…”

Rep. Dennis Moore (KS-03) questions CBO Director Dr. Peter Orszag on military readiness:

Rep. Moore: “But there are other costs to the states and the readiness potentially in the future, would that also be a fair statement?”
Orszag:“And let me just hone in on readiness. There’s no question, the military has set a sort of norm that there should be two units at home for every unit deployed abroad for regular readiness purposes and training and what have you, and we are nowhere near that. We’re somewhere close to one for one, with ranges between .75 and 1.5 in terms of units at home relative to deployed abraod, and that is an unsustainable situation.”
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