The New U.S. Price Tag for the War Against ISIS: $40 Billion a Year

The $40 billion is the tip of a very deep iceberg

With the war against ISIS off to a rocky start, there are signs that the Obama administration is getting ready to up the ante substantially on weaponry, manpower and aid to allies – at a cost of an additional $30 billion to $40 billion a year.

Earlier, Gordon Adams, a military analyst at American University, told The Fiscal Times that the mission to stop ISIS will cost $15 billion to $20 billion annually, based on his "back of the envelope" calculations. Other analysts have made similar forecasts. But based on soundings of the defense establishment, Adams said Thursday that the Defense Department would almost certainly request funding of twice that level later this year.

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The estimated $30 billion to $40 billion of new spending would come on top of the Pentagon's $496 billion fiscal 2015 operating budget for personnel and contractors and the roughly $58.6 billion in an "Overseas Contingency Operation" fund that is used to finance U.S. war operations in the Middle East.

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The OCO, as it is known, has paid for the protracted U.S. military engagement in the Middle East with borrowing that adds to the long-term U.S. debt. If Adams' projections are correct, then the OCO would total as much as $80 billion to $90 billion in the coming year.


House Democratic Whip Steny Hoyer (D-MD) has urged the Armed Services and Appropriations Committees to schedule hearings as soon as possible to provide taxpayers with a realistic assessment of what it may cost in the coming decade to battle ISIS -- and gauge the likely impact on the deficit and other spending priorities.

Adams said he has taken into account a number of factors in coming up with his new ISIS war price tag. For one, he said, Defense Secretary Chuck Hagel is determined to persuade Congress to offset recent budget cuts or sequesters mandated under the Budget Control Act that he believes have hurt the country's defense posture.

Moreover, the war is proving more complex and challenging than many assumed, and ISIS is proving to be remarkably resilient. Finally, there is a need to bolster NATO and Middle Eastern allies who are backing the U.S. campaign of airstrikes.

"There will be a good deal of that money for air operations, a good deal of that for support on the ground for the Iraqis, and a good deal of that for support on the ground for the Syrian opposition," Adams said in speculating how the huge surge in spending may be used. "Also, there will be something in there for the Jordanians and other coalition companies that can't pay their own way and a good deal for replenishing munition stocks that have been reduced by the air operations."

"I have consummate faith that they can get to $30 billion to $40 billion a year without breaking a sweat," he added.

Until recently, how the government would finance the costs of the war received little attention. After all, Obama had allies to help. He forged a U.S.-led coalition of more than 40 Middle Eastern and European allies that pledged to fulfill the president's goal of "degrading and ultimately destroying" the Muslim jihadist terrorists.

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The United States has spent about $1.1 billion since mid-June on military operations in Iraq, including the more recent airstrikes in Syria, according to the Defense Department. That works out to roughly $7 million to $10 million a day – a drop in the DOD bucket compared with the hundreds of millions of dollars it spent daily fighting in Afghanistan in 2013.

The Center for Strategic and Budgetary Assessments, a Washington think tank, recently issued an estimate of the cost of operations against ISIS that ranged from $4 billion to $22 billion a year, depending on the duration, scope and the extent to which ground forces get involved.

President Obama has been adamant that the U.S. will not deploy ground troops to Iraq beyond the 1,600 to 2,000 soldiers who will be there for security and to protect U.S. interests. Obama has said his goal is to arm and train "moderate" Syrian rebels to help combat ISIS in Syria as well as somehow bolster the Iraqi government's rag-tag army.

However, House Speaker John Boehner and other congressional Republican leaders are skeptical that Obama's strategy can work without substantially more resources – including more ground troops.

Moreover, Army Gen. Martin Dempsey, the chair of the Joint Chiefs of Staff, testified on Capitol Hill last month, "If we reach the point where I believe our advisers should accompany Iraqi troops on attacks against specific [Islamic State] targets, I'll recommend that to the president."

An analysis of the Center for Strategic and Budgetary Assessments, a "lower-intensity air campaign" would cost between $2.4 billion and $3.8 billion a year, a "higher intensity air campaign" would cost $4.2 billion to $6.8 billion, while an all-out "boots on the ground" campaign would cost $13 billion to $22 billion. That third option assumes 25,000 U.S ground personnel would be deployed to Iraq and Syria.

"This force is assumed to consist of several thousand special operations forces at the 'tip of the spear,' supported by a combat aviation brigade, two brigade combat teams, and other forces providing logistical and medical support, all based in Iraq and/or Syria," the report stated.

The Wall Street Journal reported earlier this week that ISIS "appears to have largely withstood the airstrikes so far and with scant pressure on the ground in Iraq and Syria, the militants have given up little of the territory they captured before the campaign." Moreover, the Pentagon has said that airstrikes alone cannot save the ISIS-besieged town of Kobani, a strategically vital area along the Syria-Turkey border, The Washington Post reported yesterday.

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Some experts are cautioning that the U.S. may be stumbling into another long-term conflict in the Middle East with huge budgetary implications, just as it did a dozen years ago following the 9/11 attacks on the U.S.

A study by a Harvard researcher last year estimated that the U.S. wars in Afghanistan and Iraq will ultimately cost taxpayers a startling $4 trillion to $6 trillion when "taking into account the medical care of wounded veterans and expensive repairs to a force depleted by more than a decade of fighting," The Post reported.

Linda J. Bilmes, a public policy professor at Harvard, found that the U.S. has already spent about $2 trillion for the military campaigns in Afghanistan and Iraq. Those costs, she said, "are only a fraction of the ultimate price tag."

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"In addition to the bill for military operations, there are costs associated with veterans' benefits, depreciation of equipment, humanitarian aid, covert action, and paying (as the U.S. frequently does) for the military efforts of our coalition 'partners,'" Bilmes wrote this week in the Boston Globe.

There are other factors that may eventually drive up the total cost that were not reflected in Adams' projections, who was a senior White House official for national security and foreign policy budgets during the Clinton administration.

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Those include increased spending to beef up homeland security and border control operations, increased cyber security, a possible replacement for USIA to thwart the social media propaganda of ISIS, and other steps to prevent ISIS or its sympathizers from attacking Americans or U.S. national interests.

The government over the years has poured unprecedented sums into the operations of the sprawling Department of Homeland Security and scores of other agencies that are responsible for protecting Americans and their food supply, government buildings and national parks from terrorist attacks. According to one recent estimate, the government spends about $70 billion annually on homeland security operations throughout the government.

John Mueller, a senior fellow at the Cato Institute and an authority on homeland security, said the government is already is spending so much on homeland security that it would probably take an attack by ISIS or panic among the public to prompt Congress to approve a substantial increase.

"Two things could happen," he said in an interview yesterday. "Number one, there could be an attack on the United States, at which all bets are off and all that expense goes up. Thing number two -- which is more subtle to measure -- is that officials at places like Homeland Security come in and argue in the budget process, 'You know, Mr. President, if you really want to convey to the American people that we are safe on all fronts, we think you will probably have to increase our budget."

If that were to happen, Mueller said, it might result in a "10 percent to 20 percent" increase in Department of Homeland Security spending next year.