Obama Plans $42 Billion Cut in War Costs With Iraq, Afghan Troop Reduction

The Obama administration’s plan to reduce the number of U.S. troops in Iraq and Afghanistan will cut the Pentagon’s war budget by $42 billion -- a 26 percent decrease from this year’s level, according to government officials.

The proposed $117 billion for fiscal year 2012, which begins Oct. 1, would be the lowest expenditure for the wars since fiscal 2005.

The war-spending request will accompany a $553 billion defense base budget for fiscal 2012 that is expected to go to Congress the week of Feb. 14, the officials said. That compares with the $525 billion stopgap defense measure Congress passed last month, said Congressional Research Service analyst Stephen Daggett.

The drop from the Pentagon’s fiscal 2011 war-spending request of $159 billion reflects President Barack Obama’s plan to reduce troop levels in the war zones and stricter White House rules on what costs can be included in the war budget, said the officials, who asked that their names not be used because the budget has not been formally released.

“That’s the largest year-to-year decrease in total war funding since” the Afghan war began, Todd Harrison, a defense budget analyst for the nonpartisan Center for Strategic and Budgetary Assessments in Washington, said in an e-mail.

“The bigger question here is what does this indicate in terms of strategy?” Harrison said. “With a year-to-year reduction in war funding of this magnitude, it appears to signal an intent to continue the withdrawal from Iraq and to begin reducing troops levels in Afghanistan during fiscal 2012,” he said.

Troops Deployed

The Pentagon today has roughly 97,000 troops in Afghanistan and 47,000 in Iraq. The 144,000 total is the lowest since July 2006, when the U.S. had about 148,100 deployed, according to military data compiled by the nonpartisan Congressional Research Service. U.S. troops are scheduled to leave Iraq by the end of this year.

The war-spending number is the smallest since Congress approved $102.6 billion in fiscal 2005, said Amy Belasco, war cost analyst at CRS.

Annual Pentagon-only war costs peaked at $179.7 billion in fiscal 2008, with the height of troop deployments to both nations totaling 194,000 in May 2008. That figure included 158,900 U.S. troops in Iraq as the Bush administration surge was starting to wind down, according to CRS data.

From the September 2001 terrorist attacks through last Sept. 30, the end of fiscal 2010, Congress has authorized $1.2 trillion to pay for military operations, base security, embassy costs and Noble Eagle homeland defense air patrols, CRS said. Through Nov. 30, 2010 -- the latest data available -- the Pentagon has obligated, or put on contract, $954.3 billion, according to Pentagon Comptroller figures provided yesterday.

For the first three months of this fiscal year, the Pentagon spent a monthly average of $4.3 billion in Afghanistan and $3.4 billion in Iraq.

In fiscal 2008, the Pentagon averaged $10.9 billion a month for Iraq and $2.7 billion for Afghanistan, according to Comptroller figures.

To contact the reporter on this story: Tony Capaccio at acapaccio@bloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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