How U.S. Taxpayers Are Paying the Pentagon to Occupy the Planet
Picking Up a $170 Billion Tab
“Are you monitoring the construction?” asked the middle-aged man on a bike accompanied by his dog.
“Ah, sì,” I replied in my barely passable Italian.
“Bene,” he answered. Good.
In front of us, a backhoe’s guttural engine whined into action and empty dump trucks rattled along a dirt track. The shouts of men vied for attention with the metallic whirring of drills and saws ringing in the distance. Nineteen immense cranes spread across the landscape, with the foothills of Italy’s Southern Alps in the background. More than 100 pieces of earthmoving equipment, 250 workers, and grids of scaffolding wrapped around what soon would be 34 new buildings.
We were standing in front of a massive 145-acre construction site for a “little America” rising in Vicenza, an architecturally renowned Italian city and UNESCO world heritage site near Venice. This was Dal Molin, the new military base the U.S. Army has been readying for the relocation of as many as 2,000 soldiers from Germany in 2013.
Since 1955, Vicenza has also been home to another major U.S. base, Camp Ederle. They’re among the more than 1,000 bases the United States uses to ring the globe (with about 4,000 more in the 50 states and Washington, D.C.). This complex of military installations, unprecedented in history, has been a major, if little noticed, aspect of U.S. power since World War II.
During the Cold War, such bases became the foundation for a “forward strategy” meant to surround the Soviet Union and push U.S. military power as close to its borders as possible. These days, despite the absence of a superpower rival, the Pentagon has been intent on dotting the globe with scores of relatively small “lily pad” bases, while continuing to build and maintain some large bases like Dal Molin.
Americans rarely think about these bases, let alone how much of their tax money -- and debt -- is going to build and maintain them. For Dal Molin and related construction nearby, including a brigade headquarters, two sets of barracks, a natural-gas-powered energy plant, a hospital, two schools, a fitness center, dining facilities, and a mini-mall, taxpayers are likely to shell out at least half a billion dollars. (All the while, a majority of locals passionately and vocally oppose the new base.)
How much does the United States spend each year occupying the planet with its bases and troops? How much does it spend on its global presence? Forced by Congress to account for its spending overseas, the Pentagon has put that figure at $22.1 billion a year. It turns out that even a conservative estimate of the true costs of garrisoning the globe comes to an annual total of about $170 billion. In fact, it may be considerably higher. Since the onset of “the Global War on Terror” in 2001, the total cost for our garrisoning policies, for our presence abroad, has probably reached $1.8 trillion to $2.1 trillion.
How Much Do We Spend?
By law, the Pentagon must produce an annual “Overseas Cost Summary” (OCS) putting a price on the military’s activities abroad, from bases to embassies and beyond. This means calculating all the costs of military construction, regular facility repairs, and maintenance, plus the costs of maintaining one million U.S. military and Defense Department personnel and their families abroad -- the pay checks, housing, schools, vehicles, equipment, and the transportation of personnel and materials overseas and back, and far, far more.
How much does the United States spend each year occupying the planet with its bases and troops?The latest OCS, for the 2012 fiscal year ending September 30th, documented $22.1 billion in spending, although, at Congress’s direction, this doesn’t include any of the more than $118 billion spent that year on the wars in Afghanistan and elsewhere around the globe.
While $22.1 billion is a considerable sum, representing about as much as the budgets for the Departments of Justice and Agriculture and about half the State Department’s 2012 budget, it contrasts sharply with economist Anita Dancs’s estimate of $250 billion. She included war spending in her total, but even without it, her figure comes to around $140 billion -- still $120 billion more than the Pentagon suggests.
Wanting to figure out the real costs of garrisoning the planet myself, for more than three years, as part of a global investigation of bases abroad, I’ve talked to budget experts, current and former Pentagon officials, and base budget officers. Many politely suggested that this was a fool’s errand given the number of bases involved, the complexity of distinguishing overseas from domestic spending, the secrecy of Pentagon budgets, and the “frequently fictional” nature of Pentagon figures. (The Department of Defense remains the only federal agency unable to pass a financial audit.)
Ever the fool and armed only with the power of searchable PDFs, I nonetheless plunged into the bizarro world of Pentagon accounting, where ledgers are sometimes still handwritten and $1 billion can be a rounding error. I reviewed thousands of pages of budget documents, government and independent reports, and hundreds of line items for everything from shopping malls to military intelligence to postal subsidies.
Wanting to err on the conservative side, I decided to follow the methodology Congress mandated for the OCS, while also looking for overseas costs the Pentagon or Congress might have ignored. It hardly made sense to exclude, for example, the health-care costs the Department of Defense pays for troops on overseas bases, spending for personnel in Kosovo, or the price tag for supporting the 550 bases we have in Afghanistan.
In the spirit of “monitoring the construction,” let me lead you on an abbreviated account of my quest to come up with the real costs of occupying planet Earth.
Although the Overseas Cost Summary initially might seem quite thorough, you’ll soon notice that countries well known to host U.S. bases have gone missing-in-action. In fact, at least 18 countries and foreign territories on the Pentagon’s own list of overseas bases go unnamed.
Particularly surprising is the absence of Kosovo and Bosnia. The military has had large bases and hundreds of troops there for more than a decade, with another Pentagon report showing 2012 costs of $313.8 million. According to that report, the OCS also understates costs for bases in Honduras and Guantánamo Bay by about a third or $85 million.
And then other oddities appear: in places like Australia and Qatar, the Pentagon says it has funds to pay troops but no money for “operations and maintenance” to turn the lights on, feed people, or do regular repairs. Adjusting for these costs adds an estimated $36 million. As a start, I found:
$436 million for missing countries and costs.
That’s not much compared to $22 billion and chump change in the context of the whole Pentagon budget, but it’s just a beginning.
At Congress’s direction, the Pentagon also omits the costs of bases in the oft-forgotten U.S. territories -- Puerto Rico, Guam, American Samoa, the Northern Mariana Islands, and the U.S. Virgin Islands. This is strange because the Pentagon considers them “overseas.” More important, as economist Dancs says, “The United States retains territories... primarily for the purposes of the military and projecting military power.” Plus, they are, well, literally overseas.
Conservatively, this adds $3 billion in total military spending to the OCS.
However, there are more quasi-U.S. territories in the form of truly forgotten Pacific Ocean island nations in “compacts of free association” with the United States -- the Marshall Islands, the Federated States of Micronesia, and Palau. Ever since it controlled these islands as “strategic trust territories” after World War II, the U.S. has enjoyed the right to establish military facilities on them, including the nuclear test site on the Bikini Atoll and the Ronald Reagan Ballistic Missile Defense Test Site elsewhere in the Marshalls.
This comes in exchange for yearly aid payments from the Office of Insular Affairs, adding another $571 million and yielding total costs of:
$3.6 billion for territories and Pacific island nations.
Speaking of the oceans, at Congress’s instruction, the Pentagon excludes the cost of maintaining naval vessels overseas. But Navy and Marine Corps vessels are essentially floating (and submersible) bases used to maintain a powerful military presence on (and under) the seas. A very conservative estimate for these costs adds another $3.8 billion.
Then there are the costs of Navy prepositioned ships at anchor around the world. Think of them as warehouse-bases at sea, stocked with weaponry, war materiel, and other supplies. And don’t forget Army prepositioned stocks. Together, they come to an estimated $604 million a year. In addition, the Pentagon appears to omit some $861 million for overseas “sealift” and “airlift” and “other mobilization” expenses. All told, the bill grows by:
$5.3 billion for Navy vessels and personnel plus seaborne and airborne assets.
Also strangely missing from the Cost Summary is that little matter of health-care costs. Overseas costs for the Defense Health Program and other benefits for personnel abroad add an estimated $11.7 billion yearly. And then there’s $538 million in military and family housing construction that the Pentagon also appears to overlook in its tally.
So too, we can’t forget about shopping on base, because we the taxpayers are subsidizing those iconic Walmart-like PX (Post Exchange) shopping malls on bases worldwide. Although the military is fond of saying that the PX system pays for itself because it helps fund on-base recreation programs, Pentagon leaders neglect to mention that the PXs get free buildings and land, free utilities, and free transportation of goods to overseas locations. They also operate tax-free.
While there’s no estimate for the value of the buildings, land, and utilities that taxpayers provide, the exchanges reported $267 million in various subsidies for 2011. (Foregone federal taxes might add $30 million or more to that figure.) Add in as well postal subsidies of at least $71 million and you have:
$12.6 billion for health care, military and family housing, shopping and postal subsidies.
We can’t forget about shopping on base, because we the taxpayers are subsidizing those iconic Walmart-like PX (Post Exchange) shopping malls on bases worldwide.Another Pentagon exclusion is rent paid to other countries for the land we garrison. Although a few countries like Japan, Kuwait, and South Korea actually pay the United States to subsidize our garrisons -- to the tune of $1.1 billion in 2012 -- far more common, according to base expert Kent Calder, “are the cases where the United States pays nations to host bases.”
Given the secretive nature of basing agreements and the complex economic and political trade-offs involved in base negotiations, precise figures are impossible to find. However, Pentagon-funded research indicates that 18% of total foreign military and economic aid goes toward buying base access. That swells our invoice by around $6.3 billion. Payments to NATO of $1.7 billion “for the acquisition and construction of military facilities and installations” and other purposes, brings us to:
$6.9 billion in net “rent” payments and NATO contributions.
Although the OCS must report the costs of all military operations abroad, the Pentagon omits $550 million for counternarcotics operations and $108 million for humanitarian and civic aid. Both have, as a budget document explains about humanitarian aid, helped “maintain a robust overseas presence,” while the military “obtains access to regions important to U.S. interests.” The Pentagon also spent $24 million on environmental projects abroad to monitor and reduce on-base pollution, dispose of hazardous and other waste, and for “initiatives…in support of global basing/operations.” So the bill now grows by:
$682 million for counternarcotics, humanitarian, and environmental programs.
The Pentagon tally of the price of occupying the planet also ignores the costs of secret bases and classified programs overseas. Out of a total Pentagon classified budget of $51 billion for 2012, I conservatively use only the estimated overseas portion of operations and maintenance spending, which adds $2.4 billion. Then there’s the $15.7 billion Military Intelligence Program. Given that U.S. law generally bars the military from engaging in domestic spying, I estimate that half this spending, $7.9 billion, took place overseas.
Next, we have to add in the CIA’s paramilitary budget, funding activities including secret bases in places like Somalia, Libya, and elsewhere in the Middle East, and its drone assassination program, which has grown precipitously since the onset of the war on terror. With thousands dead (including hundreds of civilians), how can we not consider these military costs? In an email, John Pike, director of GlobalSecurity.org, told me that “possibly a third” of the CIA’s estimated budget of $10 billion may now go to paramilitary costs, yielding:
$13.6 billion for classified programs, military intelligence, and CIA paramilitary activities.
Last but certainly not least comes the real biggie: the costs of the 550 bases the U.S. built in Afghanistan, as well as the last three months of life for our bases in Iraq, which once numbered 505 before the U.S. pullout from that country (that is, the first three months of fiscal year 2012). While the Pentagon and Congress exclude these costs, that’s like calculating the New York Yankees’ payroll while excluding salaries for each year’s huge free agent signings.
Conservatively following the OCS methodology used for other countries, but including costs for health care, military pay in the base budget, rent, and “other programs,” we add an estimated:
$104.9 billion for bases and military presence in Afghanistan and other war zones.
Having started with the OCS figure of $22.1 billion, the grand total now has reached:
$168 billion ($169,963,153,283 to be exact).
That’s nearly an extra $150 billion. Even if you exclude war costs -- and I think the Yankees show why that’s a bad idea -- the total still reaches $65.1 billion, or nearly three times the Pentagon’s calculation.
But don’t for a second think that that’s the end of our garrisoning costs. In addition to spending likely hidden in the nooks and crannies of its budget, there are other irregularities in the Pentagon’s accounting. Costs for 16 countries hosting U.S. bases but left out of the OCS entirely, including Colombia, El Salvador, and Norway, may total more than $350 million. The costs of the military presence in Colombia alone could reach into the tens of millions in the context of more than $8.5 billion in Plan Colombia funding since 2000. The Pentagon also reports costs of less than $5 million each for Yemen, Israel, Uganda, and the Seychelles Islands, which seems unlikely and could add millions more.
When it comes to the general U.S. presence abroad, other costs are too difficult to estimate reliably, including the price of Pentagon offices in the United States, embassies, and other government agencies that support bases and troops overseas. So, too, U.S. training facilities, depots, hospitals, and even cemeteries allow overseas bases to function. Other spending includes currency-exchange costs, attorneys’ fees and damages won in lawsuits against military personnel abroad, short-term “temporary duty assignments,” U.S.-based troops participating in exercises overseas, and perhaps even some of NASA’s military functions, space-based weapons, a percentage of recruiting costs required to staff bases abroad, interest paid on the debt attributable to the past costs of overseas bases, and Veterans Administration costs and other retirement spending for military personnel who served abroad.
Beyond my conservative estimate, the true bill for garrisoning the planet might be closer to $200 billion a year.
Those, by the way, are just the costs in the U.S. government’s budget. The total economic costs to the U.S. economy are higher still. Consider where the taxpayer-funded salaries of the troops at those bases go when they eat or drink at a local restaurant or bar, shop for clothing, rent a local home, or pay local sales taxes in Germany, Italy, or Japan. These are what economists call “spillover” or “multiplier effects.” When I visited Okinawa in 2010, for example, Marine Corps representatives bragged about how their presence contributes $1.9 billion annually to the local economy through base contracts, jobs, local purchases, and other spending. Although the figures may be overstated, it’s no wonder members of Congress like Senator Kay Bailey Hutchison have called for a new “Build in America” policy to protect “the fiscal health of our nation.”
And the costs are still broader when one considers the trade-offs, or opportunity costs, involved. Military spending creates fewer jobs per million dollars expended than the same million invested in education, health care, or energy efficiency -- barely half as many as investing in schools. Even worse, while military spending clearly provides direct benefits to the Lockheed Martins and KBRs of the military-industrial complex, these investments don’t, as economist James Heintz says, boost the “long-run productivity of the rest of the private sector” the way infrastructure investments do.
To adapt a famous line from President Dwight Eisenhower: every base that is built signifies in the final sense a theft. Indeed, think about what Dal Molin’s half a billion dollars in infrastructure could have done if put to civilian uses. Again echoing Ike, the cost of one modern base is this: 260,000 low-income children getting health care for one year or 65,000 going to a year of Head Start or 65,000 veterans receiving VA care for a year.
A Different Kind of “Spillover”
Bases also create a different “spillover” in the financial and non-financial costs host countries bear. In 2004, for example, on top of direct “burden sharing” payments, host countries made in-kind contributions of $4.3 billion to support U.S. bases. In addition to agreeing to spend billions of dollars to move thousands of U.S. Marines and their families from Okinawa to Guam, the Japanese government has paid nearly $1 billion to soundproof civilian homes near U.S. air bases on Okinawa and millions in damages for successful noise pollution lawsuits. Similarly, as base expert Mark Gillem reports, between 1992 and 2003, the Korean and U.S. governments paid $27.3 million in damages because of crimes committed by U.S. troops stationed in Korea. In a single three-year period, U.S. personnel “committed 1,246 criminal acts, from misdemeanors to felonies.”
As these crimes indicate, costs for local communities extend far beyond the economic. Okinawans have recently been outraged by what appears to be another in a long series of rapes committed by U.S. troops. Which is just one example of how, from Japan to Italy, there are what Anita Dancs calls the “costs of rising hostility” over bases. Environmental damage pushes the financial and non-financial toll even higher. The creation of a base on Diego Garcia in the Indian Ocean sent all of the local Chagossian people into exile.
So, too, U.S. troops and their families bear some of those nonfinancial costs due to frequent moves and separation during unaccompanied tours abroad, along with attendant high rates of divorce, domestic violence, substance abuse, sexual assault, and suicide.
“No one, no one likes it,” a stubbly-faced old man told me as I was leaving the construction site. He remembered the Americans arriving in 1955 and now lives within sight of the Dal Molin base. “If it were for the good of the people, okay, but it’s not for the good of the people.”
“Who pays? Who pays?” he asked. “Noi,” he said. We do.
Indeed, from that $170 billion to the costs we can’t quantify, we all do.
Copyright 2012 David Vine