Wednesday, October 24, 2007

The Iraq War, the Pentagon and Your Tax Dollars

The Congressional Budget Office did a study to figure out how much the Iraq war will cost if it continues until 2017. The answer is 2.4 trillion. Nicole Belle did the math. The cost would be $8,000 for every man, woman and child in the US. A possible way to fund a 2017 Iraq war is an increase in interest payments. The Federal Reserve would have to figure out many ways to squeeze banks and foreign lenders if the war is going to be paid for without tax increases.

The CBO was lowballing the costs because the Pentagon (surprise) does horrible bookkeeping. CBO is projecting that President Bush would make significant cuts in the amount of troops in Iraq. No one believes that.


On the basis of the two scenarios specified by Chairman Spratt, CBO projected the costs of activities associated with operations in Iraq and Afghanistan and the war on terrorism through 2017. Because DoD does not report detailed operational statistics, those projections—which CBO derived by calculating the ratio between current force levels and funding requested by the Administration for 2008—are rough approximations.3


In the first scenario, the number of personnel deployed on the ground for the war on terrorism would be reduced from an average of about 200,000 in fiscal year 2008 to 30,000 by the beginning of fiscal year 2010 and then remain at that level through 2017. CBO estimates that costs to the U.S. government under this scenario would total $570 billion over the 2008–2017 period (see Table 1).


In the second scenario, the number of personnel deployed to Iraq and other locations associated with the war on terrorism would decline more gradually, from an average of about 200,000 in fiscal year 2008 to 75,000 by the start of fiscal year 2013 and then remain at that level through 2017. CBO estimates that costs to the government under this scenario would total $1,055 billion over the 2008–2017 period.


In addition to estimating the costs of the two scenarios over the next decade, CBO recently estimated the potential costs of maintaining a longer-term U.S. military presence in Iraq. The budgetary implications of maintaining such a presence are discussed in Box 1.


The answer is the Iraq war, to run to 2017, would cost much more than the CBO estimate. Republicans would just say it could be paid for with tax cuts.

The study shows that the Pentagon needs serious reform. The reports states "determining how much has actually been spent is difficult." The taypayers don't even know what the DoD is doing with their money. In 2002, the DoD didn't know where 25 percent of their funds went.

"According to some estimates we cannot track $2.3 trillion in transactions," said Former Sec. of Defense Donald Rumsfeld.

Nothing has changed since then.

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