The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 Amy Belasco Specialist in U.S. Defense Policy and Budget September 28, 2009 Congressional Research Service 7-5700 www.crs.gov RL33110 CRS Report for Congress Prepared for Members and Committees of Congress The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 Summary With enactment of the FY2009 Supplemental (H.R. 2346/P.L. 111-32) on June 24, 2009, Congress has approved a total of about $944 billion for military operations, base security, reconstruction, foreign aid, embassy costs, and veterans’ health care for the three operations initiated since the 9/11 attacks: Operation Enduring Freedom (OEF) Afghanistan and other counter terror operations; Operation Noble Eagle (ONE), providing enhanced security at military bases; and Operation Iraqi Freedom (OIF). Congress is currently considering the FY2010 War request that was submitted to Congress along with DOD’s baseline request. The House passed its bill on July 30, 2009 (H.R. 3326) and the Senate is expected to act on its version in late September 2009. This $944 billion total covers all appropriations approved by Congress for FY2001 to meet war needs through FY2009, the current fiscal year ending September 30, 2009. Of that total, CRS estimates that Iraq will receive about $683 billion (72%), OEF about $227 billion (24%) and enhanced base security about $29 billion (3%), with about $5 billion that CRS cannot allocate (1%). About 94% of the funds are for DOD, 5% for foreign aid programs and embassy operations, and less than 1% for medical care for veterans. As of July 2009, DOD’s average monthly obligations for contracts and pay were about $10.9 billion, including $7.3 billion for Iraq, and $3.6 billion for Afghanistan. Compared to a year ago when the surge ended but troop levels remained high, average obligations have fallen by about 12%. Decreases in costs as troops are withdrawn from Iraq have been largely offset by increases in costs for additional troops for Afghanistan. The FY2010 war request totals $139 billion including $130 billion for DOD for both wars, $6.4 billion for the State Department’s foreign and diplomatic operations, and $2.1 billion for VA medical costs for OEF and OIF veterans. Overall war funding is decreasing from the peak of $185 billion in FY2008 during the surge in Iraq to $150 billion in FY2009. This decline reflects primarily lower war-related procurement as DOD’s returned to a narrower, more traditional definition of war-related costs, rather than lower troop levels since increases for Afghanistan offset decreases for Iraq. Based on the current request, the cost of the Afghan and Iraq wars would fall by another 8% in FY2010, a decrease that is less than the currently planned 19% decrease in overall troop levels. If the Administration’s FY2010 war request is enacted, total war-related funding would reach $1.08 trillion, including $748 billion for Iraq, $300 billion for Afghanistan, $29 billion for enhanced security, and $5 billion that cannot be allocated. Of this cumulative total, 69% would be for Iraq, 28% for Afghanistan, and 3% for enhanced security. On August 30, 2009, General Stanley McChrystal, Commander in Afghanistan, submitted a strategic assessment and a request for additional troops was reportedly given to Secretary of Defense Gates on September 26 , 2009. That request is unlikely to be vetted either within DOD and the Administration until additional ongoing White House reviews of the strategy are completed. In a January 2009 update, the Congressional Budget Office projected that additional war costs for FY2010-FY2019 could range from $388 billion, if troop levels fell to 30,000 by 2011, to $867 billion, if troop levels fell to 75,000 by about 2013. Under these CBO projections, funding for Iraq, Afghanistan and the GWOT could total about $1.3 trillion to about $1.8 trillion for FY2001- FY2019 depending on the scenario. Congressional Research Service The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 Contents Introduction ................................................................................................................................1 Total War Funding Enacted ...................................................................................................1 Total War Costs if FY2010 Request is Approved ...................................................................2 Pending FY2010 Request......................................................................................................3 Potential Troop Increases in Afghanistan.....................................................................................4 th War Cost Issues in the 111 Congress..........................................................................................4 War Cost Estimates for Iraq and Afghanistan.........................................................................6 Problems with Reliability of DOD’s Estimates by Operation ...........................................7 Estimates of War-Related Budget Authority.....................................................................8 Funding for Each Agency..............................................................................................10 Trends in War Funding..............................................................................................................12 Estimates for Iraq and Afghanistan and Other Operations ....................................................15 CBO Projections of Future Costs...................................................................................16 Past Trends and Future DOD Costs in Iraq ....................................................................17 Past Trends and Future DOD Costs in Afghanistan........................................................19 Past Trends and Future Costs in Enhanced Security.......................................................19 DOD Spending Thus Far.....................................................................................................19 Changes in Average Monthly Obligations......................................................................22 Troop Level Changes in the Bush and Obama Administrations............................................23 Funding to Train and Equip Iraqi and Afghan Security Forces .............................................24 Reset and Reconstitution.....................................................................................................26 DOD Changes Definition of War Costs .........................................................................26 Procurement Funding in FY2007 and FY2008...............................................................27 Front Loading Reset Funding........................................................................................27 Carryover of DOD War Investment Funding..................................................................28 Accuracy and Expansion of Reconstitution Requests.....................................................29 Modularity as an Emergency Expense ...........................................................................30 Growing the Force as a War Cost ..................................................................................30 Questions About War-Related Procurement Issues.........................................................31 Potential Readiness Issues...................................................................................................32 Congressional Options to Affect Military Operations...........................................................33 Problems in War Cost Estimates and Reporting .........................................................................35 Difficulties in Explaining DOD’s War Costs........................................................................36 Changes in Troop Strength ............................................................................................37 Reliance on Reservists Falls..........................................................................................40 Changes in Military Personnel Costs .............................................................................41 Changes in Operating Costs ..........................................................................................42 Changes in Investment Costs.........................................................................................42 Special Funds and the Flexibility Issue..........................................................................43 Average Cost Per Deployed Troop and Future Costs............................................................45 Estimates of Future Costs..............................................................................................46 Congressional Research Service The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11 Figures Figure 1. Active-Duty and Reserve Shares of OIF/OEF Average Annual Troop Levels, FY2003-Early FY2007...........................................................................................................41 Tables Table 1. Estimated War Funding by Operation: FY2001-FY2010 War Request ............................9 Table 2. Estimated War Funding by Agency: FY2001-FY2010 .................................................. 11 Table 3. Budget Authority for Iraq, Afghanistan, and Other Global War on Terror (GWOT) Operations: FY2001-FY2010 Request.....................................................................13