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Originally published Friday, December 26, 2008 at 12:00 AM

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$1 trillion war bill spurs call for change

President-elect Obama's administration needs to monitor war spending more closely than the current White House has, according to a new study that criticized President Bush's approach to paying for the Iraq and Afghanistan wars, a bill that is projected to approach nearly $1 trillion next year.

The Washington Post

WASHINGTON — President-elect Obama's administration needs to monitor war spending more closely than the current White House has, according to a new study that criticized President Bush's approach to paying for the Iraq and Afghanistan wars, a bill that is projected to approach nearly $1 trillion next year.

Even with declining troop numbers in Iraq, the direct price tag of the two wars could reach $1.7 trillion by 2018, the Center for Strategic and Budgetary Assessments reported. The defense think tank's figure does not include potentially hundreds of billions more in indirect economic and social costs, such as higher oil prices and lost wages.

The war in Iraq alone has cost more in inflation-adjusted dollars than every other U.S. war except World War II, the center's analysis found.

Defense Secretary Robert Gates, named by Obama to continue in that job, has made it clear the incoming administration will scrutinize military spending, which has mushroomed since 2001 as a result of the wars and related costs.

"We need to take a very hard look at the way we go about acquisition and procurement," he said this month.

The center agreed and blamed the ballooning budgets on the Bush administration's unprecedented decision to pay for the wars through giant emergency-spending measures rather than through appropriations requests.

"The process has reduced the ability of Congress to exercise effective oversight. It has also tended to obscure the long-term costs and budgetary consequences of ongoing military operations," the report says.

Steven Kosiak, a defense-budget expert and author of the study, said the Obama administration should "budget in a more straightforward way, to provide better justification for war-related costs" by having a budget for military operations and long-term force modernization, and limiting supplemental spending to "a real emergency."

The Office of Management and Budget (OMB) declined to comment on the report. It said Congress has appropriated $819.6 billion for the conflicts in Iraq and Afghanistan through fiscal 2008. Fiscal 2009 ends Sept. 30.

The report noted that the Iraq war has cost far more than the Bush administration estimated before the March 2003 invasion, and it cited an interview that Mitch Daniels, then the OMB director, gave to The New York Times, in which he indicated the Iraq war could cost $50 billion to $60 billion. "These estimates have already proven to be wildly optimistic," the report says.

Direct costs of the wars have increased from about $17 billion in 2001, when the United States overthrew the Taliban government in Afghanistan, to $93 billion in 2003, when the U.S. military invaded Iraq, and $182 billion for 2008. Those costs cover military operations, the building of Iraqi and Afghan forces, foreign assistance and veterans benefits. The study was based on a broad survey of official and unofficial war-cost assessments.

The report also rapped the Bush administration's paying for the wars through borrowing, rather than tax increases and spending cuts. That approach, it concluded, will lead to interest costs through 2018 that range from about $70 billion to as high as about $700 billion, depending on how much of the war funding came through bond sales.

Copyright © 2008 The Seattle Times Company

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