Economic Costs
Costs of War research tallies U.S. spending on war and military operations and examines the broader economic consequences of this spending.
When calculating the U.S. federal price tag for war, it is important to look beyond just direct congressional war appropriations, to spending on items like U.S. veterans’ health care and interest on war borrowing. Wars lead to increased budgetary costs decades into the future, including financial obligations to veterans as well as interest owed on the debt used to finance war spending.
Military spending also entails other broad costs to the U.S. economy. Over half the annual Pentagon budget – hundreds of billions of taxpayer dollars per year – goes to private companies, especially weapons manufacturers. This high rate of spending yields a cycle of political power: companies receive large contracts, which are often spread throughout multiple states, enabling the contractors to seem indispensable. The largest contractors spend millions of dollars on lobbying and campaign contributions to ensure that military spending remains high and that they continue receiving lucrative contracts.
Additionally, there are “opportunity costs,” which are the foregone opportunities of public spending on the military – money which could have gone towards societally beneficial expenditures such as infrastructure improvements, educational investments, and environmental protection.
The many private costs associated with war are almost incalculable – they include, for example, the lost income by family members of injured servicemembers who give up their jobs to become unpaid caregivers.
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