Official Iraq war costs don't tell the whole story

	Posted on Tue, Dec. 05, 2006
	By Kevin G. Hall and David Montgomery McClatchy Newspapers WASHINGTON - During a recent visit to a military family center at Fort Hood in Texas, Joyce Raezer was dismayed to find a sign in a stall in the ladies' room. It asked women to clean up because janitorial service had been cut back. "What message does that send to a family member when they walk into a family center?" asked Raezer, the director of government relations for the National Military Families Association. At Fort Leonard Wood in Missouri, swimming pools closed a month early this fall, and shuttle vans were sharply curtailed in an effort to trim spending. At Fort Sam Houston in Texas, unpaid utility bills exceeded $4 million, and the base reduced mail delivery to cut costs. Belt-tightening at the bases is only the beginning. As the United States spends about $8 billion a month in Iraq, the military is being forced to cut costs in ways big and small. Soldiers preparing to ship to Iraq don't have enough equipment to train on because it's been left in Iraq, where it's most needed. Thousands of tanks and other vehicles sit at repair depots waiting to be fixed because funds are short. At the Red River Army Depot in Texas, the Fort Worth Star-Telegram reported in October that at least 6,200 Humvees, Bradley Fighting Vehicles, trucks and ambulances were awaiting repair because of insufficient funds. There's a virtual graveyard of tanks and fighting vehicles at the Anniston Army Depot in Alabama. Depot spokeswoman Joan Gustafson said that the depot expects to repair 1,885 tanks and other armored vehicles during the fiscal year that began on Oct. 1. That's up from the 1,169 and 1,035 vehicles repaired in the prior two fiscal years. Some of the depot's private-sector contractors haven't been able to supply enough parts in time to make all the repairs, she said. The depot is trying to reduce the time it takes to get repair and replacement parts from 120 days to 60 days. Tanks and helicopters are one thing; the toll on America's warriors and their families is another. More than 73,000 soldiers returning from Iraq and Afghanistan have been diagnosed with post-traumatic stress disorder (PTSD) and with problems such as drug abuse and depression. That's enough people to fill a typical NFL stadium. Internet blogs written by soldiers or their wives tell of suicide attempts by soldiers haunted by the horror of combat, civilian careers of reservists who've been harmed by deployment and redeployment, and marriages broken by distance and the trauma of war. "Back-to-back war deployments has changed both of us - to where it's as if a marriage does not exist anymore," wrote a woman calling herself Blackhawk wife on an Iraq war vets Web site. "We just go through the daily steps of life and raising children as best we can." A mother of a returning soldier posted this: "Since he has been back, he has had 3 DUIs, wrecked his truck, attempted suicide, been diagnosed with PTSD" and is being kicked out of the Army. The length of the war in Iraq has strained all aspects of the armed forces, said Dov Zakheim, who was the Pentagon's chief financial officer from 2001 to 2004. "In 2003, I don't think anybody predicted it would go as long as World War II and the wear and tear on equipment would be as intense," said Zakheim, now a vice president for global strategy consultant Booz Allen Hamilton Inc. "When I left the department, we were spending less than $4 billion a month on Iraq. Now it's pretty much doubled." The length of the Iraq war surpassed that of World War II last month. The costs of the wars in Iraq and Afghanistan and the global fight against terrorism are expected to surpass the $536 billion in inflation-adjusted costs of the Vietnam War by spring. That's more than 10 times the Bush administration's $50 million prewar estimate. Through the fiscal year that ended on Sept. 30, Congress authorized about $436 billion in war spending, according to the Government Accountability Office, the investigative arm of Congress. In October, President Bush signed legislation that tacked on $70 billion, bringing the total to more than $506 billion. That number will rise again once Congress appropriates Iraq stabilization and reconstruction funding. The armed services, seeking to replace aging equipment and address quality-of-life issues for military families, are believed to be seeking $100 billion to $160 billion in a supplemental spending bill for spring. If that's approved, war funding - three-quarters of it going to Iraq-related operations - would reach nearly $700 billion. If U.S. troops remain in Iraq through 2010, it will approach $1 trillion. In January, Nobel Prize-winning economist Joseph Stiglitz released a study that said the true costs of the Iraq war could exceed $1 trillion and perhaps reach $2 trillion. "When I saw that figure, I thought it was an exaggeration. I no longer think it's an exaggeration," said Rep. John Murtha, D-Pa., a decorated Vietnam veteran who's criticized how the war has been fought and funded. The Stiglitz report focused on hard-to-measure things such as lifetime care for injured soldiers and the economic effect of higher oil prices as a result of the war. But his final numbers for unofficial costs are on pace to be matched by the official costs - which don't add the intangibles. "We were very conservative on the numbers, and the numbers have repeatedly come in higher than we estimated," said Stiglitz, a former chief economist of the World Bank, in a telephone interview from Spain. "Those costs continue to pile up: the health care costs, the disability costs, the replacement costs - and there's obviously an open question now if we ever reconstruct" Iraq. Here's a look at some of the costs: -RESET Until recently, little of the authorized war funding went toward reset, the military term for replacing fighting vehicles, tanks, helicopters and other equipment that are wearing out from heavy use. "We have a backlog of maintenance work to reset, fix, retool all our equipment, and at the same time we have to take care of our civilian soldiers," said Rep. Solomon Ortiz, D-Texas, who in January will become chairman of the House Armed Services subcommittee on readiness. "Many of the units in the United States Reserve or National Guard do not have any equipment because their equipment stayed in Iraq ... Humvees, weapons, trucks, tanks. You name it, they need it." Gary Schmitt, a defense expert for the American Enterprise Institute, a conservative think tank, said the problem existed before 2001. "The war has obviously made that much worse," he said. "People would be surprised, but the reality is the increases in defense spending have been personnel and operational," not for upgrading or modernizing the armed forces. The October bridge funding, which bridges the gap that occurs when the fiscal year begins before funds have been appropriated, included $24 billion for reset costs across the armed services. The Army's deputy chief of staff, Lt. Gen. David Melcher, told Congress in March that he expected reset costs of at least $12 billion a year while troops are in Iraq and for two years after withdrawal. In the 2006 fiscal year, the Marine Corps' reset request was three times bigger than its regular procurement budget. The nonpartisan Congressional Budget Office estimated a $60 billion reset price tag through 2016, assuming a reduction in U.S. troops in Iraq by 2010. "As long as the current level of intensity is maintained in Iraq operations, there's not going to be enough money to meet all the services' needs," said Loren Thompson, a defense analyst at the Lexington Institute, a military think tank. "We're really burning up money over there at a furious pace." Policymakers are stymied in their efforts to predict war costs, partly because the Department of Defense provides only vague estimates of future costs. "DOD has provided little information about overall requirements to replace worn equipment or to upgrade capabilities, or how war requirements relate to ongoing peacetime investment," Amy Belasco, a defense budget analyst for the nonpartisan Congressional Research Service, said in a September report. As the chief economist on President Bush's Council of Economic Advisers in 2002 and director of the CBO from 2002 until last year, Douglas Holtz-Eakin wrestled with that same problem. "It was hard to get actual cost data," he said. -HEALTH Between Oct. 1, 2001, and June 30, 2006, 35 percent of returning active-duty soldiers and 31 percent of Army reservists and National Guardsmen sought medical care from Veterans Affairs health centers. That figure from the Veterans Health Administration doesn't include treatment at VA hospitals. In that period, more than 33,000 returning troops received preliminary diagnoses of post-traumatic stress disorder. Others experienced depression and drug abuse. "The wear and tear on soldiers and the wear and tear on their families have been immense," said John Grady, a spokesman for the Association of the United States Army, a nonprofit group that lobbies on behalf of active and retired soldiers. Problems are getting corrected, he said, "but they're getting corrected very slowly because the money is very slow in arriving." In the first Gulf war, in which 700,000 U.S. soldiers were involved, 44 percent filed for some sort of disability compensation. More than 1.4 million U.S. soldiers have been deployed to Iraq and Afghanistan since late 2001, and about 26 percent have filed disability claims, according to raw data provided by the Department of Veterans Affairs. That percentage could grow as soldiers leave the armed forces. "I see the whole thing as a mini-Medicare, another huge entitlement program which is going to be sprawling out over the course of our lifetimes and our children's lifetimes," said Linda Bilmes, a Harvard University public finance professor and co-author of the Stiglitz study. "The big costs come when they get back ... they stand a good chance of being really underfunded and not taken care of properly." Veterans groups worry that they'll be forced to compete with other government programs for funds. Not enough attention is being given to the future mental health and medical needs of Iraq and Afghanistan war vets, they say, especially given how those wars differ from previous ones. "First, they are deployed to war longer. Second, they are being deployed to the war zone two or three times. The combat there is more intense than the Gulf War for nearly every one deployed," said Paul Sullivan, a Desert Storm veteran and director of programs for Veterans for America. "There are no rear-area jobs. Everyone is on the front lines ... cooks and clerks and truck drivers ... the entire country is a war zone." -FUTURE READINESS Military commanders complain that they've been forced to fight a war on the cheap, despite its large costs. That's because military spending totals about 4 percent of the broader economy, a historically low level. Some critics, including Murtha, want to see more funds dedicated to the military's long-term needs. "As the ships get older, the airplanes get older, we won't have the deterrent capability that we need," Murtha said. Big-ticket U.S. military programs have been delayed since the 1990s, said Schmitt at the American Enterprise Institute. There are now so many unfunded replacements and upgrades scheduled in the years ahead that the nation faces a "procurement bow wave" that could swamp the federal budget. A "spasm of endless spending in Iraq and Afghanistan" threatens future Air Force readiness, said Rep. Neil Abercrombie, D-Hawaii, the incoming chairman of the House Armed Forces subcommittee on air and land. Zakheim, the Pentagon's former CFO, said diverting money from acquisition programs is akin to "eating our seed corn for the future." --- For more on GAO concerns about funding and the global war on terror: www.gao.gov/new.items/d06885t.pdf For the Congressional Research Service report on war costs, go to www.fas.org/sgp/crs/natsec/RL33110.pdf For a military challenges report by Gary Schmitt of the American Enterprise Institute, go to www.aei.org/publications/filter.all,pubID.25097/pub_detail.asp