Missile Wars
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the budget : what will it cost?

There has been much speculation and confusion about the projected cost of the Bush administration's "layered" missile defense program. Here's a closer look.

On June 27, 2001, Secretary of Defense Donald Rumsfeld asked Congress for $8.3 billion for missile defenses -- an increase of nearly $3 billion over the previous year -- making it the largest single weapons program in the Pentagon budget. Congress approved $7.8 billion, and, pending final passage of the Defense Appropriations bill, the administration will maintain that level of funding in its 2003 budget.

There has been much speculation and confusion about the projected cost of the proposed "layered" missile defense program. So far there have been no reliable estimates, in part because the Pentagon has given few details about many of the specific systems it plans to develop. In other words, with most of it still on the drawing board, the architecture of the system, the timing and the costs have not been defined.

Still, in January 2002 the Congressional Budget Office (CBO) released its findings about the costs of a limited number of systems the Pentagon may deploy. Adding the numbers for three individual programs -- ground- and sea-based systems for intercepting long-range missiles in midcourse, and a space-based laser that could destroy them in their "boost" phase -- would yield potential costs between $198 and $238 billion in current dollars. But in a letter submitting the report to the Senate, the budget office warned that it might be inaccurate to add all the components together, arguing that the Pentagon could save money by developing all the systems together and sharing technology among them.

In the same letter, however, the CBO added, "In many cases substantial uncertainty exists about the relationship between the system descriptions available to CBO and whatever missile defenses might ultimately be deployed." In other words, it was unable to estimate costs for systems like ship-based boost-phase defense and the airborne laser.

"It's too early to start using these numbers," Colonel Rick Lehner, a spokesman for the Missile Defense Agency said. "You don't know whether any of these programs will ever be deployed. Obviously, we will have a missile defense system, but what will be deployed remains to be determined."

Meanwhile, a team of military analysts and economists brought together by Economists Allied for Arms Control (ECAAR) has criticized both the Pentagon and the CBO figures because neither reports cost estimates for all of the systems under development in the Bush administration's "layered" missile defense program. The ECAAR team has undertaken a study of its own, using publicly available information as a starting point, but going beyond the prior attempts to estimate costs by taking into account the likelihood of schedule delays, technical difficulties, and other factors that, they say, "have historically led to cost overruns and higher expenses than indicated by official estimates." In addition, the study estimates annual operation and support costs that must be borne after missile defense systems are deployed. These costs, together with R&D and acquisition, are known as "life cycle" costs.



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The ECAAR report, which will be released publicly next month, will also estimate the costs of the systems for which there are no official estimates. One such system is the airborne laser intended to be used against missiles in the boost phase. Another consists of the terminal-phase defenses which would be used against missiles that have re-entered the atmosphere and are about to strike their targets. According to ECAAR, "the cost figures will be seen as substantially greater than those previously reported."

If past skirmishes over budget figures are any indication, an accurate accounting of the total costs of a long-range missile defense may never be possible. In April 2001, the Center for Defense Information estimated that since President Ronald Reagan's Strategic Defense Initiative in 1983, the Pentagon had spent almost $100 billion on national missile defense. But the Congressional Research Service (CRS) has written that "the question of exactly how much has been spent on ... missile defense since its inception is controversial and problematic. Analysts do not all agree on what exactly to count and how to count it once identified."



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