Iraq War Tab Exceeds $2 Trillion

Iraq War Tab Exceeds $2 Trillion

The massive cost might have been even higher, had it not been for the use of contractors in the war-torn country of Iraq.

The Pentagon’s base budget has increased significantly since the war began. Additionally, the DoD has received about $900 billion in “overseas contingency” and “emergency” funding. The $2 trillion figure also includes interest costs. The government has not imposed taxes or sold many bonds to finance the war. Furthermore, beginning in 2014, the DoD added costs for fighting ISIS elements in Iraq and Syria.

Pentagon spending peaked in 2008, at $140 billion.

The Three Most Expensive Phases of the Iraq War

Deployment, rebuilding, and long-term injury care are usually the three most expensive phases of a foreign conflict. The Iraq War follows this general principle.

Deployment is expensive because it includes both direct and indirect costs. For every unit deployed in Iraq, one stateside unit is training for action and another one is idle and recovering from a tour of duty.

Other indirect deployment costs include transportation and logistics. It is not cheap to send a unit halfway across the world and give it adequate startup provisions.

After the main force departs, the critical reconstruction phase begins. The tab could be enormous. According to some estimates, it may take $1 trillion to rebuild Syria after its current civil war finally ends. That is roughly 16 times the nation’s prewar GDP.

Rebuilding is not limited to physical infrastructure, like schools and roads. The government’s infrastructure must also be rebuilt, sometimes from the ground up. That is especially true in a former authoritarian state like Iraq. Every public official, from the highest office to the lowest office, was beholden to Saddam Hussein in one way or another. Additionally, there is a cult of personality factor. Schools, streets, and towns have ideological names, film production companies have ties to the dictator, and the list goes on.

This social and political rebuilding process is not as easy as it sounds. Numerous soldiers must perform tedious work in the face of public pressure to “bring the boys home.” Immediately following World War II, the Western Powers were determined to remove any traces of Nazi influences from West Germany. That zeal lasted less than a year.

Finally, the government bears the cost of long-term injury care, in the form of the Veterans Administration. The VA’s annual budget is close to $250 billion.

How Contractors Reduce These Costs

In a nutshell, contractors are cheaper for the government because the public bears almost none of these costs.

Contractors, or the companies that employ them, are responsible for their own deployment costs. That is not limited to direct costs. That also includes the aforementioned indirect costs, such as training expenses. When private military contractors arrive in-country, the DoD, State Department, or other agency expects them to be deployment-ready.

Generally, contractors have brief tours of duty. When their deployments end, the government has no further financial responsibility. More on that below.

When fighting ends, many people mistakenly believe the war is over, but conflicts do not end just because one side decides to stop fighting. Many American companies specialize in rebuilding projects that take place in difficult environments. So, large projects are completed quickly and relatively efficiently.

Contractors also handle other rebuilding areas. As mentioned, the process of cleansing a government and society is tedious. Many soldiers are unwilling or unable to do such work. But contractors are flexible enough to handle such chores.

Finally, we get to the injury care phase. News reporters often trumpet the fact that contractors are paid a lot more than regular servicemembers. Anyone who does any contract work knows that contractor wages are higher because there is no withholding, no job security, and no medical care. That last expense is usually the big one, at least in terms of foreign military service.

The $250 billion per year that the government spends on injury care for former servicemembers is a big zero for contractors. No matter how badly they were hurt, contractors receive no injury care benefits. At least, the public pays no such benefits. Injury care is available, however, thanks to the Defense Base Act.

Injury Compensation Available

DBA benefits include not only payment for medical expenses. In most cases, wage replacement benefits are available, as well. However, insurance companies do not simply give this money away.

The benefits process usually begins when victims file claims. The basis could be a trauma injury, like a gunshot wound, or an occupational disease, such as breathing problems. Strict time deadlines typically apply. Victims who file too late could forfeit their eligibility for benefits.

A few weeks after the victim files a claim, a mediator usually presides at a settlement conference. The mediator reviews the medical records and then tries to facilitate a settlement between the victim and insurance company. Occasionally, these conferences are successful. But in most cases, DBA claims proceed to the next level.

This next level is usually a full hearing before an Administrative Law Judge. At the trial-like administrative hearing, attorneys can call witnesses, challenge evidence, and make legal arguments. Thanks to these more liberal rules, many DBA claims settle prior to the administrative hearing.

Contact Barnett, Lerner, Karsen, Frankel & Castro, P.A. for more information about DBA eligibility.