How we got the numbers

The Cost of War calculates in real time using the cost of the US-led invasion and occupation of Iraq. Estimates of these costs vary, the Cost of War calculator takes the "fixed" costs, to deploy and return US forces to base ($26.9 billion) and then increments the cost of the fighting as time passes. These costs are incremented at the rate of $15.4 billion for the first month and $11.5 billion for subsequent months.

If you're comparing our costs and what the government says the war cost, please see the section "Why Does the Department of Defense Say the War Costs $20 Billion and You Say $40 Billion?" below.

Cost of Deployment and Return

In a September, 2002 letter to Congress the Congressional Budget Office estimated that the cost of sending to the Persian Gulf and returning them to their home bases after a war would range from $14 to $20 billion. The “Heavy Air Option,” which relies on smaller ground forces, was estimated to cost $9 billion to deploy and $5 billion to return. Since the government is funding the war through deficit spending, to this $14 billion figure are added the cost of financing the war through 30-year Treasury notes at the current rate of 4.96%. This raises the total cost of deployment to $26.9 billion.

Monthly War-Fighting Costs

The Congressional Budget Office letter also states the “Heavy Air Option” would cost $8 billion for the first month of fighting and $6 billion for every subsequent month. At the current T-bill rate, this would cost, after 30 years, $15.4 billion for the first month and $11.5 billion for every subsequent month of fighting.

Comparative Costs

Head Start

The cost of a child in Head Start comes from the Head Start Program Fact Sheet issued by the US Department of Health and Human Services. The average cost per child for 2002 of $6,934 was raised by 2% to adjust for inflation to $7,073.

Children's Health Care

The figure of $2,333 per child insured under Medicare is from the National Priorities Project's analysis of the trade-offs of military spending. The average cost of Medicaid per child is based on the most recent figures available (1998) and then adjusted for inflation by 10% a year (to compensate for the faster rate of inflation in health care).

Affordable Housing

The figure of $70,000 per housing unit is based on the work of the National Priorities Project, and specifically their comparison of the costs of military spending and its alternatives: Military Spending and What it Could Really Pay For.

Teachers

The US Department of Labor's 2000 National Occupational Employment and Wage Estimates gives the average wage for elementary and secondary teachers as $42,000. In line with the analysis of the work of the National Priorities Project, we have increased this number by $25% to reflect the cost of benefits for a total of $52,500.

Four-Year College Scholarships

The College Board report Trends in College Pricing estimated that the cost of attending a four year public college or university in 2002 was $9,963, or $38,652 for four years. To this figure was added 2% to adjust for inflation, or $39,425.

Conversion to Natural Gas:

The US Department of Energy states that the cost of converting an automobile to Compressed Natural Gas (CNG) ranges from $2,500 to $4.000. The Cost of War calculator uses the $4,000 figure to calculate the cost of conversions.

Why Does the Department of Defense Say the War Costs $20 Billion and You Say $40 Billion?

After the press briefing on April 16, by US Department of Defense Comptroller Dov Zakheim, there were a flurry of reports in the American media reporting that the war in Iraq had cost $20 billion to date. On that day, the Cost of War calculated war costs as exceeding $40 billion. Why the discrepancy?

The DOD Comptroller estimated that between $10-$12 billion had been spent on military operations, which, he said, covered the cost of airlift and sealift of troops and their equipment. The Cost of War calculator estimated $9 billion in deployment costs, an underestimate of $1-3 billion. Comptroller Zakheim also stated that the war had already cost another $9 billion in the first 3 1/2 weeks of conflict, compared to the Cost of War calculator which estimated $8 billion for the first month of combat.

Lost in most of the media reports of the comptroller's remarks was the cost of returning troops and equipment to base, which the comptroller estimated to be another $5-$7 billion.

Since this cost is unavoidable, even if the United States were to completely withdrawal from Iraq today, the direct costs would be between $24-$28 billion.

The Bush Administration is funding the Iraqi war and occupation through deficit spending; at today's 30-year Treasury note interest rate, $24 billion in war costs will exceed $46 billion in tax payments; $28 billion will exceed $53 billion in subsequent tax payments.

As a result, long after Bush is out of office tens of billions of dollars will be spent on interest payments instead of college scholarships, children's health insurance, housing, or energy conversion.

Elias Vlanton & Niko Matsakis
April 17, 2003

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