costs

Afghanistan: Financial Folly

Armand Biroonak — Tue, 01 Dec 2009 14:04:38 -0500

President Obama’s expected announcement Tuesday night of a 34,000 troop surge in Afghanistan is indeed a worrisome as well as costly decision. Putting policy discussions aside on troop levels and what defines success of this eight-year-plus-long mission, a troop increase is certainly a budget-buster of misplaced priorities. We have domestic rebuilding needs right here in our country that unfortunately will remain deferred because of a misguided, wrong strategy in Afghanistan.

The cost of Afghanistan already stands at $300 billion through fiscal year 2010. Add in the Iraq War and the figure climbs to over $1 trillion. Nobel Prize winner Joseph Stiglitz and Linda Bilmes predict the total cost of both wars to tally up to $3 trillion if we consider veteran care and the other social and economic costs that are incurred during and decades after combat.

The price tag of this war is staggering. With Obama’s surge of nearly 35,000 troops, this brings the total number of American troops to about 100,000. It is estimated that to deploy each soldier to Afghanistan, it costs $1 million annually. That doesn't even include such war costs as weapons and equipment replacement or supply transport. For example, shipping just one gallon of gas to the mountainous region costs an astonishing $400, but this figure can balloon up to $1,000 per gallon in some cases. Keep in mind that the Marines in Afghanistan alone consume 800,000 gallons of gas a day.

Rep. David Obey, D-Wis., has gained a lot of attention this past week with his proposed war surcharge. Essentially his idea would place a tax upon middle- and high-income earners to help pay for operations abroad and to build a sense of shared sacrifice and burden upon Americans that largely has been absent the past eight years. Not surprisingly, Congress has little appetite to pass such a drastic proposal, but Obey’s idea makes a strong statement on its own: We just cannot afford large scale military operations without fiscal action.

Misplaced Priorities

It is time we take a hard look at our nation’s investment strategy. We simply cannot afford to do it all at home and abroad, without addressing the elephant in the room: defense spending. The Pentagon and its operations already consume more than half of total federal discretionary spending–far more than education, health and transportation combined. While our politicians bicker and conservative hawks screech over the costs of providing universal health care or rebuilding our transportation and infrastructure–real tangible benefits that will help America grow stronger–little ruckus is made by the nearly $700 billion in defense spending appropriated for this year alone.

Source: Office of Management and Budget

Rep. Obey said it best, stating,

“The Pentagon has only one job, and that's to talk about this war and this war only…But [Obama] has, and I have jobs that require us to look at everything else that's tied into it. “I have to look at the entire federal budget, as chairman of the committee, for instance. I have to see what $400 billion or $500 billion, $600 billion, $700 billion, over a decade, for this effort, will cost us on education, on our efforts to build the entire economy. And - and when you look at it that way, I come to a different conclusion than [Obama] does.”

We have gone too long signing a blank check over to the Pentagon, while avoiding needed investments here at home that bolster our national and economic security. The American Society of Civil Engineers places our infrastructure investment needs at $2.2 trillion over the next five years. The Obama administration and Congress did well by making down payments on education, transportation and energy in the American Recovery and Reinvestment Act (the “stimulus”), but it is only a drop in the bucket. Fortunately, there are progressive members in Congress who recognize that we must rebuild America, not risk financial folly that is Afghanistan —we should stand with them.

Private Insurers Overcharge Medicare By $1.3 Billion

Armand Biroonak — Tue, 16 Dec 2008 13:58:04 -0500

Under a program called Medicare Advantage, the federal government pays insurers for delivering Medicare benefits. The insurance companies' payments are based, in part, on their anticipated revenues and expenses. If the companies had been more accurate, they could have spent much of that $1.3 billion on enhanced health benefits or lower monthly premiums, and they still would have maintained their expected profit margin, the Government Accountability Office said in a report expected to be released Thursday.

Rising Health Care Costs are to Blame for Rising Medicare Cost

Armand Biroonak — Tue, 14 Oct 2008 00:00:00 -0400

The Congressional Budget Office reports the main factor in the rising cost of Medicare is the growth of health care costs—health expenditures as a percent of GDP have more than doubled since 1970, growing from 7.0 percent to 14.8 percent in 2002.

Bush Administration's Medicare Advantage Plan Costs Double

Armand Biroonak — Tue, 14 Oct 2008 00:00:00 -0400

The Bush Administration’s privatized “Medicare Advantage” plans are rising twice as fast as costs in traditional Medicare, according to the Government Accountability Office, the Congressional Budget Office, and the Medicare Payment Advisory Commission.

Costs of Worn-out Iraq Equipment High

Alexander Sewell — Thu, 02 Oct 2008 12:33:11 -0400

The U.S. Government Accountability Office reports that it will take years and cost about $200 billion to repair or replace equipment that was worn out or broken in the Iraq war.

More than $13 Billion for Iraq Reconstruction Unaccounted For

Armand Biroonak — Wed, 01 Oct 2008 17:06:18 -0400

A former Iraqi official recently estimated that more than $13 billion meant for reconstruction projects in Iraq was wasted or stolen through elaborate fraud schemes.

Iraq War Costs

Armand Biroonak — Tue, 30 Sep 2008 00:00:00 -0400

The federal government has authorized $656 billion for the Iraq war. Of that total, $152 billion was appropriated to fund the Iraq war during the current fiscal year. That amounts to more than $12 billion per month and $416 million per day.

Contractors Used Heavily in Iraq War

Armand Biroonak — Tue, 30 Sep 2008 00:00:00 -0400

A record number of private contractors are used in Iraq--receiving almost 20% of funding for operations or $85 billion-- these contractors are often not held accountable for their use of the money.

Health Insurance Costs Grow More Gradually in 2008

Armand Biroonak — Wed, 24 Sep 2008 17:15:31 -0400

Over the past decade, insurance premiums have grown much more quickly than wages and inflation. That wasn't the case this year. But to help slow the costs of health insurance, companies are increasingly offering coverage that requires their workers to pay more of their medical expenses before the insurance will kick in.

Iraq War Costs

Armand Biroonak — Wed, 10 Sep 2008 18:12:32 -0400