February 11, 2008

Honorable Kent Conrad
Chairman
Committee on the Budget
United States Senate
Washington, DC 20510

Dear Mr. Chairman:

As you requested, the Congressional Budget Office (CBO) has reviewed the funding provided for military activities in Iraq, Afghanistan, and elsewhere in the war on terrorism and analyzed the increases in appropriations that have occurred over the past several years.

The United States began combat operations in Afghanistan in fiscal year 2002 and in Iraq in fiscal year 2003. To finance those operations (and other activities related to the war on terrorism), the Congress provided $18 billion and $76 billion in emergency appropriations in those years, respectively. With the exception of a slight decrease in 2004, to $74 billion, funding has increased steadily each year, to a total of $165 billion for 2007. If the Administration’s request for 2008 is funded in full, appropriations for military operations and other war-related activities in Iraq, Afghanistan, and elsewhere in the war on terrorism will rise to $188 billion this year and to a cumulative total of $752 billion since 2001.

Most of the spending is concentrated in two categories—operation and maintenance, which has roughly doubled from 2004 to 2008, and procurement, which has increased tenfold over that period. The reasons for some of the increases are difficult to determine precisely because available data on the pace of operations and other factors that might affect costs are limited and because some of the funding and reporting categories are very broad. CBO’s enclosed analysis is based on supplemental budget requests submitted by the Administration, budget justification materials provided by the Department of Defense, reports on obligations incurred during the war, and committee reports accompanying appropriation acts.

If you wish further details on this analysis, we would be happy to provide them. The CBO staff contacts are David Newman and Jason Wheelock.

Sincerely,

Peter R. Orszag
Director

Enclosure

cc: Honorable Judd Gregg
Ranking Member

Honorable John M. Spratt Jr.
Chairman
House Committee on the Budget

Honorable Paul Ryan
Ranking Member

Honorable Carl Levin
Chairman
Senate Committee on Armed Services

Honorable John McCain
Ranking Member

Honorable Ike Skelton
Chairman
House Committee on Armed Services

Honorable Duncan Hunter
Ranking Member

Honorable Robert C. Byrd
Chairman
Senate Committee on Appropriations

Honorable Thad Cochran
Ranking Minority Member

Honorable David R. Obey
Chairman
House Committee on Appropriations

Honorable Jerry Lewis
Ranking Member

Honorable Daniel K. Inouye
Chairman

Subcommittee on Defense
Senate Committee on Appropriations

Honorable Ted Stevens
Ranking Member

Honorable John P. Murtha
Chairman
Subcommittee on Defense
House Committee on Appropriations

Honorable C. W. Bill Young
Ranking Member