To: jttmab who wrote (817 ) 3/21/2003 10:58:27 AM From: Ron Read Replies (2) | Respond to of 21614 Tallying the Cost of War Billions For War Effort Add to Economic Strain of Deficits, Tax Cuts By Betsy Stark ABCNEWS.com March 21 — The Bush administration has been asked many times to estimate a cost for the war with Iraq. So far it has refused to answer that question. The White House says it will submit a supplemental budget request to Congress to help pay for the cost of war but it has given no timetable for that. Sources say the White House could seek as little as $40 billion or as much as $100 billion. The cost of the build-up to war has already been substantial. Getting the military's high-tech arsenal half way around the world — along with 250,000 troops — has been a roughly $13 billion undertaking. And the monthly cost of maintaining this force is expected to be around $9 billion. "A lot of the costs are very mundane, like bringing in fuel, bringing in food, building a laundry facility for troops in the region, paying for combat pay for military personnel, activating the reserves," says Steve Kosiak, a military analyst for the Washington, D.C-based think tank Center for Strategic and Budgetary Assessment. Now that the fighting has begun, the bill will rise some more. The military's plan to "shock and awe" the Iraqis requires a heavy expenditure of munitions. According to retired U.S. Air Force General Richard Hawley, "All told you're going to find somewhere between 500 and 800 individual missions flown per day. And those 500 to 800 attack sorties, weapons-delivering sorties, will put somewhere between 1,500 and 2,000 weapons on target each day." Everything that will be used in this war has been bought and paid for already, from the $55 bullets and million-dollar cruise missiles to the $4 billion aircraft carriers and the $50 million jets on board. What taxpayers may not realize is that many things will have to be paid for again. "One of the costs of the war will be replacing equipment we lose in combat or in accidents and also munitions that we expend during the war," says Kosiak. Real Cost May Be In Iraq Occupation How expensive the fighting part of the war is depends on the intensity of battle and how long it lasts. The estimates range from $18 billion for a one-month war to $85 billion for a six-month war. Sound expensive? It's probably the cheap part. "What makes this war potentially expensive is the number of years we might be in occupation," says Laurence Meyer, an economist and former Federal Reserve Board governor now with the Center for Strategic and International Studies in Washington, D.C. Securing the peace in Iraq is expected to cost far more than waging the war. It's a process likely to require thousands of American troops and up to a decade of reconstruction and humanitarian aid. Already the Pentagon has authorized $900-million for post-war rebuilding in Iraq, including the rebuilding of roads and bridges, the building of schools, hospitals and homes, and the repairing of the electrical grid and other utilities. "We're talking about as much as $50 billion a year for 10 years," adds Meyer. "Well, you can see that gets very expensive and dwarfs dramatically the cost of the combat phase." Another expense that could dwarf the cost of combat is the fallout from any terrorist reprisals in the United States. The cost of defending the homefront could be significant, especially for cities and states already struggling with big budget deficits. "I think a big difference between this war and the Gulf War of 1991 is that we do have to think about the consequences here at home," says Kosiak. New York City estimates the cost of additional security to protect its bridges, ports, subways and key landmarks at $5 million a week. New York Mayor Michael Bloomberg has met with President Bush to secure Washington's help in paying this bill. The president promised to help, but no dollar commitment was made. Burden for Struggling Economy The consequences for the broader economy have been dramatic — gas prices up sharply, stock prices down, consumers and businesses in a state of paralysis. "The build up to war has certainly added uncertainties to an already struggling economy," says Robert Hormats, vice chairman of Goldman Sachs International. Stock prices have improved in the past week but remain vulnerable. Investors seem to be betting on a best-case outcome to this war and that's a risky bet. The war in Iraq and the tighter homeland security are also adding to a $250 billion deficit. And this time there are no allies promising to foot part of the bill. Some wonder if the nation can afford this war … and everything else on the president's agenda. Says Hormats: "We can afford a war, we can afford domestic programs and we can afford tax cuts. The problem is we probably can't afford all of them at once." For now, the administration seems intent on trying.