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A new exhaustive analysis undertaken by Harvard Kennedy School Senior Lecturer Linda Bilmes indicates that the U.S. military engagements in Afghanistan and Iraq have resulted in "the most expensive wars in U.S. history." And, as a result she argues, the federal government will face some extremely difficult defense budget tradeoffs in the years ahead.
Bilmes, who is a former CFO of the US Department of Commerce, calculated all direct and indirect war related expenditures, "including long-term medical care and disability compensation for service members, veterans and families, military replenishment and social and economic costs." The total pricetag, she calculates, will amount to between $4 and 6 trillion dollars.
"The largest portion of that bill is yet to be paid," Bilmes writes. "Since 2001, the US has expanded the quality, quantity, availability and eligibility of benefits for military personnel and veterans. This has led to unprecedented growth in the Department of Veterans Affairs and the Department of Defense budgets. These benefits will increase further over the next 40 years."
Bilmes examines the growing costs of the VA health care system, VA disability benefits, and the TRICARE system at the Department of Defense. Her study reveals that 886,161 veterans from Iraq and Afghanistan have been treated by VA for medical conditions, and 783,623 of them have filed disability claims with the VA. This is a far higher percentage than in previous wars. She also finds that TRICARE is growing faster than VA Medical care, Medicare or Medicaid, and is projected to rise from 8% to 18% of the total Pentagon budget in the next decade if current trends continue.
"The national security agencies -- which are already scheduled to shrink, will come under pressure," Bilmes concludes. "One likely result is that the budgetary constraints will tilt the US in a direction of fewer military personnel in the forces, due to the immediate and long-term cost of maintaining active-duty end-strength. Instead of peopl , budget considerations will favor greater investment in unmanned weaponry, robotics, and other technological solutions -- which may or may not be a wise choice over the longer-term."
Linda J. Bilmes is Daniel Patrick Moynihan Senior Lecturer in Public Policy. Her research focuses on US budgeting and public administration, particularly on the costs of war, veterans' affairs and the civil service. Her recent books include the New York Times bestseller "The Three Trillion Dollar War: The True Cost of the Iraq Conflict" (with Joseph E. Stiglitz, 2008) and "The People Factor: Strengthening America by Investing in Public Service" (with W. Scott Gould, Brookings, 2009). She has held senior positions in government including Assistant Secretary and CFO of the US Department of Commerce under President Clinton.
Linda J. Bilmes, Daniel Patrick Moynihan Senior Lecturer in Public Policy
"The national security agencies -- which are already scheduled to shrink, will come under pressure," Bilmes concludes. "One likely result is that the budgetary constraints will tilt the US in a direction of fewer military personnel in the forces, due to the immediate and long-term cost of maintaining active-duty end-strength."