Chairman Filner, Congressman Buyer and distinguished members of the committee, my name is Amy Belasco, and I’m a Specialist in U.S. Defense Policy and Budget at the Congressional Research Service (CRS). Thank you for asking me to testify about the important issue the committee is considering: the long-term costs of the current conflicts in Iraq and Afghanistan. This testimony is based on my work on defense budget issues at CRS as well as on over 25 years of experience working in the executive and legislative branches.
As you requested, my testimony is designed to set the stage for this hearing on long-term costs by addressing the cost-to-date as well as future estimates of costs for the three operations that make up what the Bush Administration refers to as the “global war on terror” (GWOT):
- Operation Iraqi Freedom: the war in Iraq;
- Operating Enduring Freedom: predominantly Afghanistan but also including DOD’s counter-terror operations from the Philippines to Djibouti; and
- Operation Noble Eagle: enhanced security for Department of Defense (DOD) bases.
This testimony will also briefly discuss DOD costs for Post-Traumatic Stress Disorder (PTSD) and Traumatic Brain Injury (TBI), two signature medical problems of these wars. Finally, I’ll suggest oversight issues that Congress may want to address.
PROFILE OF SERVICE MEMBERS DEPLOYED SINCE 9/11
Before discussing costs, I would like to cite several DOD figures that can give committee members a profile of the demographic characteristics of the 1.6 million individual service members who have been deployed for Operation Iraqi Freedom (OIF) or Operation Enduring Freedom (OEF) since the 9/11 attacks.1 Since most of the troops and costs are for Iraq and Afghanistan and little is known about DOD’s other counter-terror operations, I’ll refer to the two operations as simply Iraq or Afghanistan.
Of the 1.6 million service members who have been deployed thus far, 72% have been active-duty personnel and 28% have been activated reservists and National Guardsmen. Nine out of ten have been male. Not quite half have been single and the rest married. Some 72% have been white and the remainder black, Hispanic, other minority, or unknown.2
About 60% of all those deployed have been between the ages of 17 and 30, another 25% between 30 and 40 years old and the remaining 13% between the age of 40 and 60. And over 60% of those deployed have been in their first tour of duty. Finally, enlisted personnel have accounted for about 85% and officers about 15%.3 Thus, the typical deployed service member has been a young, white, male, first term enlistee, demographic characteristics that are similar to the make-up of the active-duty force.
CONCERNS ABOUT DEPLOYMENTS
Many observers have raised concerns about how many military personnel have been deployed for more than one or two tours. Press accounts typically report that a particular unit has been deployed for the third or fourth time implying that this applies to all members of that unit. But because of high turnover as service members change assignments, complete enlistments, or retire, military personnel in a particular unit are often not the same individuals who were previously in that unit. Thus, the frequency of a unit’s deployment does not necessarily tell us how often an individual has been deployed.
A better measure of potential stress on the force is the number of individual service members who have been deployed more than once or twice within the past six years of operations. According to DOD data, about two-thirds or one million of all the 1.6 million individuals who have been deployed thus far are in their first tour of duty. Another 25% have been deployed twice. Another 10% have been deployed three or more times, including many Air Force pilots with brief tours. As would be expected, active-duty personnel are more likely than reserve component members — which includes both reservists and National Guardsmen — to deploy more than once.4
Another frequently voiced concern has been the extent of DOD’s reliance on the reserve component in these conflicts. Since 9/11, DOD has deployed a total of 443,000 in the reserve component. In the past two years, DOD has called up about 100,000 National Guard and reservists, a level that is well below the 150,000 activated each year between FY2003 and FY2005. Some of those activated have been deployed and some have served in the United States filling the positions of those deployed or providing enhanced security at bases. The decrease in activations may reflect the fact that many of those in the reserve component have bumped up against the DOD policy cap of 24 months deployed.5
COST-TO-DATE OF IRAQ AND AFGHANISTAN
Now to costs. There are several ways to look at the cost of the current conflicts in Iraq and Afghanistan. DOD witnesses often cite the current “burn rates” or monthly obligations as of a particular date. While this figure reflects current spending, it does not reflect overall costs.
DOD’s war cost reporting system captures the amounts that have been obligated for Iraq, for Afghanistan, and for enhanced security and hence shows how funds have been allocated after the fact or once contracts or purchase orders are signed and military or civilian personnel are paid. DOD’s figures do not reflect the total amount that Congress has appropriated to date which includes funds that remain to be obligated in later years.
Nor does DOD’s reporting system capture some intelligence funding that DOD does not administer and it may not include some funds that are not strictly war-related such as monies to restructure Army and Marine Corps units. Nor does DOD capture amounts that have actually been spent.6 Concerned about the accuracy of its reporting, DOD asked a private firm to conduct an audit on war cost tracking.7 Although DOD’s current FY2008 request identifies the funds for Iraq vs. those for Afghanistan, DOD has not presented a breakdown by operation of all funds received to date.8
To present a more complete picture, CRS has estimated how all funds appropriated-to-date are split between Iraq, Afghanistan and enhanced security relying on DOD and other data. In addition, CRS includes not only DOD appropriations but also State Department funds for its diplomatic operations, AID funds for reconstruction and aid programs, and Department of Veterans Affairs (VA) funds for medical care of veterans of these two conflicts. CRS estimates do not, however, include any VA disability benefits for Iraq and Afghan veterans since CRS was not able to get figures from the VA. About 90% of total funds appropriated to date have been for DOD military operations in theater as well as to train Iraq and Afghan security forces.
Total Cost-To-Date. CRS estimates that Congress has provided a total of about $615 billion for Iraq, Afghanistan and other counter-terror operations, and enhanced security at U.S. bases, often referred to by the Bush Administration as the global war on terror (GWOT). This total includes about:
- $573 billion for DOD;
- $41 billion for foreign aid, reconstruction, and building and operating embassies in Iraq and Afghanistan; and
- $1.6 billion for VA medical care for veterans of these conflicts.
On a monthly basis, CRS estimates that DOD is spending about $11.7 billion for the three GWOT operations. This year’s average monthly spending for Iraq and Afghanistan is running substantially higher than the $8.8 billion in FY2006 and the $7.7 billion in FY2005. These increases reflect both higher spending by the services to buy new weapon systems to replace and upgrade war-worn equipment and higher operating costs — particularly in Iraq — much of it unexplained.9
Cost of Iraq. CRS estimates that Congress has provided about $455 billion for Iraq including:
- $423 billion for DOD;
- $31 billion for State/AID; and
- $1.5 billion for VA medical care.
Average monthly spending for Iraq is running about $9.7 billion, well above the $7.4 billion in FY2006 and the $6.5 billion in FY2005. Only a small amount of the increase in FY2007 reflects the “surge” in troops in Iraq.10
Cost of Afghanistan. CRS estimates that Congress has provided a total of about $127 billion for Afghanistan including about:
- $117 billion for DOD;
- $10 billion for State/AID; and
- $100 million for VA Medical costs.
Average monthly obligations are running about $1.7 billion for Afghanistan, again substantially more than the $1.4 billion in FY2006 and the $1.1 billion in FY2005. The increase may reflect higher troop levels and operating costs.
Enhanced Security and Other. CRS estimates that Congress has appropriated about $28 billion for enhanced security at DOD bases. Average monthly obligations for enhanced security now run about $30 million a month, less than half of last year’s level.
Of the $615 billion total for the three missions appropriated thus far, CRS was unable to allocate about $5 billion in war-related appropriations that appear not to have been captured by DOD’s tracking system, a problem also identified by GAO.11
COMPARISONS TO OTHER MAJOR WARS
One way to put Iraq and Afghanistan war costs into perspective is to compare them to those of previous wars. Looking strictly at military costs and using estimates prepared by CRS Specialist, Stephen Daggett that are adjusted for inflation, the discussion below compares the cost-to-date after six years of operations to previous wars.12
First, let’s first compare the cost of all funds appropriated thus far for the three GWOT operations. That total now equals about 90% of the 12-year war in Vietnam ($670 billion) and about double the cost of the Korean war ($295 billion).13
The cost of all three operations thus far is now over six times as large as the cost of the first Persian Gulf War ($94 billion). Comparisons to that war are problematic, however, because the United States paid some $7 billion or about 7% of the cost of the war because our allies, principally Kuwait and Saudi Arabia, reimbursed the United States for most of the cost.14
Some would prefer to look only at the cost of the Iraq war. On that basis, Iraq has thus far cost about 65% as much as Vietnam. On the other hand, Iraq has cost about 50% more than Korea to date and about four and a half times more than the costs incurred for the first Persian Gulf War.
STATUS OF FY2008 REQUEST
Congress has not yet acted on the Administration’s FY2008 request for war funding with one exception. As of today, the Administration has requested $152.4 billion for war-related activities in Iraq and Afghanistan including DOD costs, State and AID, and VA medical.15 This figure also includes an additional request of $5.2 billion for Mine Resistant Ambush Protected (MRAP) vehicles, trucks with a V-shaped hull that have proven more effective against attacks from Improvised Explosive Devices than uparmored HMMWVs. Congress provided funds for MRAP vehicles in the FY2008 Continuing Resolution.16
The total of $152.4 billion does not include the $42.3 billion and possibly additional State/AID funds that Secretary of Defense Robert Gates stated in late September would be requested shortly.17 If those additional funds are requested, the total for FY2008 will reach $194.7 billion.
Senior appropriators have said that they may not consider the FY2008 supplemental request until January or February of 2008, though some interim or bridge funding may be included in DOD’s FY2008 regular Defense Appropriations bill which has been passed by the House and Senate.18 When DOD receives its regular or baseline appropriations, it is expected to finance war costs until a supplemental is passed by using regular funds slated to be needed at the end of the year and any interim funds provided.
ESTIMATING FUTURE WAR COSTS
Future war costs depend on several factors:
- the duration of the wars in Iraq and Afghanistan;
- the number of troops deployed each year;
- the intensity of conflict;
- the number, size, and location of bases; and,
- the scope of post-war costs.
DOD’s current plans call for ending the current “surge” in troops by June 2008, and Secretary of Defense Gates has suggested that troop levels could be reduced to 100,000 in Iraq by the end of 2008.19 DOD has not, however, provided Congress with any estimates of future costs beyond its FY2008 request and a $50 billion “placeholder” figure for FY2009.20 Since 2003, the Congressional Budget Office has estimated future war costs over ten-year periods based on assumptions specified by members of Congress. Typically, DOD has requested larger amounts than CBO has predicted even when troop levels are similar, in part, because DOD has included many expenses as war costs that could be considered part of its baseline budget.21 Since there are no DOD requests, CRS is unable to identify or assess potential differences between CBO and DOD.
This year, CBO estimated the cost over the next ten years of several different scenarios for Iraq and Afghanistan which, at least, lays out a range of future costs depending on various troop levels. These scenarios assume:
- a draw down of current troop levels to 30,000 by 2010;
- a more gradual draw down to 75,000 troops by 2013; and
- a steady-state “Korea” like scenario with 55,000 troops.22
CBO’s Ten-Year Cost of Two Drawdown Scenarios. CBO estimates the U.S. government would incur additional costs of $481 billion to $603 billion for Iraq and Afghanistan over the next ten years, assuming troop levels in Iraq and Afghanistan are drawn down to 30,000 troops by 2010 and remain at that level. The range in the estimate reflects different assumptions about how long the Administration’s current troop increase continues and when a draw down would begin.23 With these assumptions, CBO estimates would total between $1.1 and $1.2 trillion by 2017 including all funds appropriated to-date and future estimated costs.24
Assuming a more gradual draw-down scenario in which troop levels drop to 75,000 by 2013, CBO estimated that costs over the next ten years could total between $924 billion and $1.010 trillion, again with the range again reflecting how long the current troop “surge” is maintained. Under that scenario, costs would reach a total of between $1.5 trillion and $1.6 trillion by 2017. Under both scenarios, CBO includes not only DOD's operational and investment costs but also $50 billion to train and equip Afghan and Iraqi security forces, $16 billion for diplomatic operations and foreign aid and $9 billion to $13 billion for veterans’ benefits and medical care.25
Alternative Steady State Annual Cost. Another way to look at future costs is the annual spending when the troop draw down reaches a steady-state level. CBO estimates that the annual steady-state cost of would be about $22 billion for 30,000 troops and $61 billion for 75,000 troops. These figures include not only the cost of DOD’s military operations and support but also the cost of training Iraqi and Afghan security forces, State Department diplomatic costs, and aid programs, and VA medical costs.26 These levels are considerably lower than the FY2007 appropriation of $173 billion.27
In a new analysis, CBO estimates the annual cost of maintaining a long-term presence of 55,000 troops in Iraq, characterized as a “Korea” option. With this troop level, CBO estimates the cost would be $25 billion in a “combat” scenario similar to today’s Iraq.28 This estimate, however, does not include State, AID, and VA medical costs. Making a rough adjustment for those costs based on CBO figures, the cost to maintain 55,000 troops in combat conditions would be about $33 billion a year.29
POST-WAR COSTS: POST-TRAUMATIC STRESS DISORDER AND TRAUMATIC BRAIN INJURY
There are many challenges in estimating not only future costs but also post-war costs — those that could be incurred after the conflicts in Iraq and Afghanistan have ended. For DOD, the largest unknown may be reset costs, the amount needed to repair and replace war-worn equipment. In the case of military personnel, however, the greatest unknown may be future medical treatment costs for those injured.
For DOD, war-related medical costs are generally short-lived because many of those injured complete their enlistments and leave the service.30 At that point, they may turn to the Department of Veterans’ Affairs for treatment. Nevertheless, it may be useful to look at the number of patients and costs that DOD has experienced to date for two of the signature medical problems of these wars — Traumatic Brain Injury or TBI and Post-Traumatic Stress Disorder or PTSD. Although this may give a window into the incidence and cost of TBI and PTSD in the first few years, it does not necessarily capture those whose symptoms are not caught or which appear later on, or the difficulties faced by individuals.
Based on DOD data, about 60,000 troops have been diagnosed with either PTSD or TBI. This total includes about 34,000 with PTSD and 26,000 with TBI between FY2003 and FY2007.31 Based on these figures, about 4% of the 1.6 million service members who have deployed to Iraq and Afghanistan have been diagnosed with these conditions while in the service. As an overall average, this figure does not capture the likelihood for those deployed multiple times or for longer periods or for those personnel on the ground—primarily Army and Marine Corps soldiers—who would be expected to be more likely to experience these conditions.
Treating these patients has cost about $291 million over the past five years counting all care associated with TBI or PTSD symptoms. Some might argue that all costs for the care of those individuals should be counted even if the symptoms were not related to the diagnosis. If that broader definition were used, treatment costs have been $782 million over the past several years.32
The annual DOD cost per person has averaged about $1,850 for PTSD and $5,500 for TBI, counting all treatment, mental health and pharmacy costs related to those conditions. Using the broad definition of all care provided to those patients including care not related to either condition, the cost would be $6,600 for those with PTSD and $11,200 for those with TBI.33
During the past several years, annual costs for both TBI and PTSD have increased rapidly from $18 million in FY2003 to $90 million in FY2006, which may reflect higher patient loads as the wars have continued. Each year, DOD has requested emergency funds to cover the costs of war-related medical care including the cost of treating PTSD and TBI.
Concerned about these conditions, Congress recently appropriated $900 million in the FY2007 Supplemental (P.L.110-28) specifically for TBI and PTSD, including $600 million for treatment and $300 million for research. These funds will be available in FY2007 and FY2008. The language in the act permits the Secretary of Defense to transfer any funds that are “in excess of DOD requirements” to the Department of Veterans’ Affairs for the same purpose.34
It is not clear whether DOD will need all the funds appropriated in the next two years. Recently, the two-year cost of TBI and PTSD has been running about $170 million including costs related to these conditions. If all care for individuals diagnosed with either condition is counted, total treatment costs have been about $500 million.35
PROBLEMS IN IDENTIFYING THOSE DEPLOYED AND OVERSIGHT ISSUES
Predictions of future costs depend on accurate information about current costs as well as understanding the factors that drive costs. Yet even in the sixth year of conflict, some basic information remains in dispute and explanations for the rapid increase in DOD costs are few. One good example is the various figures identifying the number of service members deployed to the Iraq and Afghanistan theaters of operations.
In justification material for the FY2007 and FY2008 supplementals, the Defense Department estimated that some 320,000 military personnel were dedicated to Iraq and Afghanistan operations including most of the increase or “surge” in troops this summer.36 This figure is almost twice as large as the total of 160,000 including some140,000 troops in Iraq and another 20,000 troops in Afghanistan that is commonly reported in the press, and sometimes referred to as “boots on the ground.”
The increase in troop levels in Iraq (as well an increase in Afghanistan) could account for some but by no means all of the difference. Assuming an additional 30,000 for the “surge” would still leave unaccounted for another 130,000 troops of those identified by DOD in its justification material. DOD has not publicly explained the mission or location of these other personnel or allocated these personnel between Iraq and Afghanistan.
From other DOD data sources, it appears that some of these other military personnel are deployed or training up in neighboring countries such as Kuwait, Bahrain, Qatar, and the United Arab Emirates, some may be backfilling positions for those in the United States, and about 30,000 are in unknown locations.37 Earlier years pose the same problem.
That Congress lacks a clear picture of the number or allocation of all military personnel dedicated to Iraq and Afghanistan either in the past or today makes prediction of future costs — whether future operational or medical costs — problematic. For example, troop location may be important in gauging the likelihood that service members face intensive combat and hence, a higher risk of developing PTSD or TBI.
Similarly, the cost of future operations and the extent of stress on the force depend on how many troops are dedicated to Iraq and Afghanistan operations. Thus far, however, DOD has not resolved this basic discrepancy and has provided little analysis of the factors that drive cost trends whether for medical costs or operating tempo. While there is considerably more detail in DOD’s latest justification materials, there is little transparency about the assumptions and rationale for requests for funding for reset, operating tempo, procurement or medical costs, gaps which may limit Congressional oversight.
1 This DOD figure does not include additional activated guard and reservists who backfilled positions of those deployed or provided enhanced security at U.S. bases since 9/11.Defense Manpower Data Center, Contingency Tracking System,”Profile of Service Members Ever Deployed as of August 31, 2007.”
4 Analysis by CRS of Defense Manpower Data Center, Contingency Tracking System, “Total Number of Deployment Events by Service and Component,” August 2007.
5 Data from Defense Manpower Data Center, Report 17523, Monthly Average Deployed Personnel and Activated Reservists, from September 2001 through July 31, 2007. DOD has a longstanding policy that places a cumulative cap of 24 months on activations of those in the reserve component.
6 DOD’s financial systems do not segregate “amounts spent” or outlays for war expenses from its regular or baseline budget because the funds are mixed in the same account.
7 CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 by Amy Belasco. For example, DOD does not consider the 10 C-17 aircraft added by Congress in the FY2007 supplemental to be war-related.
8 See Table 1a. In DOD, FY2008 Global War on Terror Request, February 2007 http://www.dod.mil/comptroller/defbudget/fy2008/fy2007_supplemental/
9 Table 6, Ibid.
10 CRS estimates that the increase of 30,000 troops in Iraq cost between $3.5 billion and $4 billion in FY2007, adding about $300 million to monthly spending and accounting for 13% of the increase.
11 The $615 billion includes the $5.2 billion provided to DOD in Sec. 123, H.J. Res 52, P.L. 110-92, FY2008 Continuing Resolution, Sept. 29, 2007. See also, Table 3 in CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 by Amy Belasco.
12 Calculations prepared by CRS Specialist, Stephen Daggett of DOD costs, relying on a variety of data and converted to FY2007 dollars.
14 Department of Defense, Annual Report to Congress for Fiscal Year 1994, January 1993; converted to FY2007 dollars by CRS.
15 This figure includes $141.7 billion for DOD, $4.6 billion for State/AID and $800 million for VA Medical costs that was requested in the Administration’s FY2008 budget in February within agencies baseline request and as additional emergency requests. It also includes an additional $5.3 billion for DOD for Mine Resistant Ambush Protected (MRAP) vehicles requested on July 31, 2007 in a budget amendment.
16 See Sec. 123, H.J.Res 52,P.L.110-92 enacted September 29, 2007.
17 See Senate Appropriations Committee, Transcript of hearing, “Fiscal 2008 War Supplemental,” September 26, 2007.
18Conferees to H.R. 3222, the FY2008 DOD Appropriations bill have been appointed by the House but not the Senate.
19Philadelphia Inquirer, “Bush Says U.S. Will Shift More Troops To Support Role,” September 16, 2007.
20 See Table 3 in CRS Report RL33999, Defense: FY2008 Authorization and Appropriations by Pat Towell, Stephen Daggett, and Amy Belasco, updated September 28, 2007.
21 For example, CBO recently estimated that 40% of the Army’s request for reset to repair and replace war-worn equipment was not war-related; see CBO, Replacing and Repairing Equipment Used in Iraq and Afghanistan: The Army’s Reset Program, September 2007; http://www.cbo.gov/ftpdocs/86xx/doc8629/09-13-ArmyReset.pdf
22 Testimony of Robert A. Sunshine before the House Budget Committee, “Estimated Costs of U.S. Operations in Iraq and Afghanistan and of Other Activities Related to the War on Terrorism,” July 31, 2007; and CBO, Letter to Senator Conrad, “The Possible Costs to the United States of Maintaining a Long-Term Military Presence in Iraq,” September 20, 2007; http://www.cbo.gov/ftpdocs/86xx/doc8641/09-20-ConradLTpresenceinIraq.pdf.
23 The low end of the CBO estimate assumes the draw down begins in FY2008 and the high end that the draw down does not begin until FY2009; see Table 5 in Ibid.
24 Testimony of Robert A. Sunshine before the House Budget Committee, “Estimated Costs of U.S. Operations in Iraq and Afghanistan and of Other Activities Related to the War on Terrorism,” July 31, 2007, p. 6-p. 7 and Table 1.
25 Testimony of Robert A. Sunshine before the House Budget Committee, “Estimated Costs of U.S. Operations in Iraq and Afghanistan and of Other Activities Related to the War on Terrorism,” July 31, 2007, p. 7-p. 8 and Table 1.
26 Ibid, Table 1.
27 CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 by Amy Belasco.
28 CBO also estimates the cost of keeping 55,000 troops in Iraq in a “non combat” scenario with low-intensity operations and troops remaining at established bases for extended tours; see CBO, Letter to Senator Conrad, “The Possible Costs to the United States of Maintaining a Long-Term Military Presence in Iraq,” September 20, 2007.
29 See Testimony of Robert A. Sunshine before the House Budget Committee, “Estimated Costs of U.S. Operations in Iraq and Afghanistan and of Other Activities Related to the War on Terrorism,” July 31, 2007; CRS adds $7.7 billion, the annual average of CBO’s ten-year estimate that covers the cost to train security forces, support diplomatic operations and foreign aid and provide VA benefits and services.
30 For example, as of May 2007, about 44% of those patients diagnosed with either TBI or PTSD between FY2003 and May 2007 were still eligible for DOD medical care; see DOD data provided to CRS by the Office of the Secretary of Defense, Health Affairs, May 31, 2007.
31 DOD data for FY2003 - May 2007 provided to CRS by the Office of the Secretary of Defense (OSD), Health Affairs.
32 DOD provided data showing the number eligible as well as the number of patients each year.
33 CRS calculations based on DOD data from the OSD, Health Affairs, May 31, 2007.
34 See Section, “Defense Health Program,” Title III, Chapter 3, P.L.110-28 May 25, 2007.
35 CRS calculation using FY2005 and FY2006 cost, the two most recent complete years of data.
36 DOD, FY2007 Emergency Supplemental Request for the Global war on Terror, Feb.2007, p. 16; http://www.dod.mil/comptroller/defbudget/fy2008/fy2007_supplemental
/FY2007_Emergency_Supplemental_Request_for_the_GWOT.pdf; and DOD, FY2008 Global War on Terror Request, February2007,p.12; http://www.dod.mil/comptroller/defbudget/fy2008/fy2007_supplemental/
37 Defense Manpower Data Center, DRS 11280, Country Analysis, September 2001 through April 2007; this data series includes some double-counting as service members move from one location to another such as those who go to Kuwait before going to Iraq.