Report: Increases in Military Spending and Security Assistance Since 9/11 – World Policy Institute – Research Project


Increases in Military Spending and Security Assistance Since 9/11

An Arms Trade Resource Center Fact Sheet

by Michelle Ciarrocca,
and William D. Hartung,
October 4, 2002

How much is the Bush administration spending to wage its war on terrorism? Leaving aside for the moment the crucial question of how much of the funding that has been added in the name of fighting terrorism is being used for that purpose, the sheer scale of the increased spending has been impressive. This fact sheet will detail what is known about increases in military spending, security assistance, and homeland security in the wake of the September 11th terror attacks. We will also provide estimates of future costs of the Bush administration’s militarized foreign policy, such as its proposed military intervention in Iraq.

The costs of the terror war are mounting rapidly. In its 22 months in office, the Bush administration has sought more than $150 billion in new military spending, the vast majority of which has been approved by Congress with few questions asked.

Spending on national defense is nearing $400 billion for FY 2003, up from $329 billion when the Bush administration took office (see table, below). Spending on the related budget category of homeland security has increased dramatically as well, from $19.5 billion in FY 2001 to $37.7 billion in FY 2003. In addition to the rapid increases in its yearly budget, the Pentagon has been the biggest beneficiary of the $68.9 billion in emergency and supplemental spending approved since the September 11th attacks, receiving $30 billion via this route. Billions more of the supplemental funds have gone to the State Department for military assistance for allies and nations supporting the war on terrorism, as well as to the various agencies that have been targeted for inclusion in the Bush administration’s proposed department of homeland defense.

As the dollars continue to flow, the scale of the anti-terror effort has been growing as well. U.S. arms, training, and military personnel have been dispatched not only to Afghanistan but also to Pakistan, India, Uzbekistan, Kyrgyzstan, Georgia, the Philippines, and Yemen. Forward bases for U.S. forces have been established or expanded at thirteen sites in nine countries, and administration policymakers are now taking aim at a new adversary, Iraq. Left unchallenged, this expansion of U.S. global military presence and military commitments will generate tens of billions of dollars in additional costs for decades to come.

U.S. National Defense Budget ($ billions)


FY 2001

FY 2002

FY 2003


$309.9 billion

$329.9 billion

$378.6 billion





DOE/other related budgets

$16.05 billion

$17.73 billion

$18.18 billion





Total National Defense (050)

$329.0 billion

$350.7 billion

$396.8 billion





Emergency Supplemental Spending Bills

Public Law 107-38 1

$20 billion total

à $13.8 billion went to DOD

Public Law 107-117 2

$20 billion total

à $3.4 billion went to DOD




Public Law 107-206 3 $28.9 billion total

à $14.4 billion went to DOD


Budget Authority By Function ($ billions)


FY 01

FY 02

FY 03

FY 04

FY 05

FY 06

FY 07

National Defense








International Affairs








Source: Department of Defense, March 2002, Table 1-1, NATIONAL DEFENSE BUDGET SUMMARY, page 12,

Emergency Supplemental Funds

Right after the September 11, 2001 attacks, Congress approved a $40 billion emergency measure, the 2001 Emergency Supplemental Appropriations “Act for Recovery from and Response to Terrorist Attacks on the United States,” (Public Law 107-38). Of the first $20 billion allocated, the Pentagon received $13.7 billion for “situational awareness,” “improved command and control,” “increased worldwide posture,” and “offensive counter-terrorism.”

The second $20 billion of emergency money approved by Congress was tagged on to the FY 2002 budget request (Public Law 107-117). Roughly $3.5 billion of that went to the Pentagon for the “Defense Emergency Response Fund” and other operation and maintenance accounts.

The emergency requests of Fall 2001 were followed by a supplemental request submitted in the spring of 2002 to pay for the ongoing costs of the war in Afghanistan and other administration anti-terror initiatives. The bill was passed by Congress and signed by the President in August of 2002. An analysis of that bill, the FY 2002 Supplemental Appropriations Act (Public Law 107-206), indicates that $14.4 billion will go to the Pentagon. Of that amount, $11.9 billion is labeled the “Defense Emergency Response Fund,” $1.45 billion will go towards weapons procurement, and $1.3 billion will go for Pentagon personnel and operation and maintenance accounts. The bill also provides $390 million to reimburse Pakistan, Jordan, and other nations deemed key allies in the war on terrorism.

U.S. State Department Budget ($ billions)


FY 2001 (actual)

FY 2002 (estimate)

FY 2003 (request)

DOS/International Affairs

$22.835 billion

$24.013 billion

$25.428 billion





Foreign Operations

$14.982 billion

$15.353 billion

$16.137 billion

Economic Support Fund

$2.315 billion

$2.224 billion

$2.290 billion

Foreign Military Financing

$3.568 billion

$3.650 billion

$4.107 billion

International Military

Education & Training

$58 million

$70 million

$80 million

Emergency Supplemental Spending Bills

Public Law 107-38 4

$20 billion total

à $5 million

Public Law 107-117 5

$20 billion total

à $1.1 billion Foreign Ops




Public Law 107-206 6 $28.9 billion total

à $1.6 billion ($1.3 billion for For. Ops)



Military Assistance

Eager to reward and reinforce America’s allies in the war on terrorism, the U.S. has stepped up military assistance to allies old and new. The State Department and International Affairs budget request for FY 2003 is $25.4 billion, up $1.4 billion from last year. While the numbers pale in comparison to the Pentagon budget, security assistance has increased substantially. Furthermore, restrictions on military aid and arms transfers to regimes involved in human rights abuses, support for terrorism, or nuclear proliferation were lifted for a number of countries in exchange for their support in the administration’s war on terrorism.

Economic Support Fund (ESF) allocations are provided on a grant basis and are available for a variety of economic purposes, like infrastructure and development projects. Although not intended for military expenditure, these grants allow the recipient government to free up its own money for military programs. Foreign Military Financing (FMF) grants and loans must be used by the recipient nation to purchase U.S. defense-related items–a nice boost for U.S. defense contractors. International Military Education and Training grants are given to foreign governments to pay for professional education in military management and technical training on U.S. weapons systems.

About $5 billion of $25.4 billion international affairs budget request for FY 2003 request is officially designated for the war on terrorism. This includes: $3.4 billion for programs such as IMET, FMF, and ESF; $88 million for programs in Russia and other former Soviet Union states; $50 million for the IAEA; and $69 million for counter-terrorism programs, including training and equipment to help other countries fight global terror.

The 2003 ESF budget request is $2.29 billion. Top recipients include: $600 million for Israel, $615 million for Egypt, $200 million for Pakistan, $60 million for Indonesia, and $25 million for India. The 2003 FMF budget request of $4.107 billion includes $2.1 billion for Israel, $1.3 billion for Egypt, $20 million for the Philippines, $50 million for Pakistan, $50 million for India, and $98 million for Colombia. This year’s $80 million IMET budget request represents a 27.5% increase over 2001. Top recipients include major allies in the war on terrorism: India, Pakistan, Uzbekistan, Georgia, Philippines, Jordan, Oman, and Yemen.

The following funds were doled out as part of the emergency supplemental bills: $600 million in ESF for Pakistan; $40.5 million in economic and law enforcement assistance for Uzbekistan; $45 million in FMF for Turkey and Uzbekistan; $45.5 in Non-proliferation Anti-terrorism Demining and Related programs; $42.2 million for training and equipment for border security forces in Uzbekistan, Tajikistan, Turkmenistan, Turkey, Kyrgyzstan, Azerbaijan, and Kazakhstan; $108 million for a variety of counter-terrorism training programs and demining in Afghanistan. The FY 2002 Supplemental (Pl-107-206) included $665 million for ESF, $387 million for FMF, $110 million for Assistance for Independent States of the former Soviet Union, and $88 million for Non-Proliferation, Anti-terrorism, De-mining, and Related programs ($12 million of which will go to Indonesia).

Homeland Defense

According to the OMB, prior to 9/11 about $20 billion in the budget went to homeland security and combating terrorism. A total of $10.6 billion was dedicated to homeland security out of the initial $40 billion in emergency funds appropriated by Congress.

The President has proposed the creation of the Department of Homeland Security. In turn, the 2003 budget request “nearly doubles funding for a sustained strategy of homeland security, focused on four key areas: bioterrorism, emergency response, airport and border security, and improved intelligence,” up from $19.5 billion to $37.7 billion. The request will provide $11 billion for border security, $3.5 billion for the nation’s “first responders” – our police, firefighters and Emergency Medical Teams, $6 billion to defend against bioterrorism, $700 million to improve intelligence-gathering and information-sharing between agencies and throughout all levels of government, $230 million to create Citizen Corps to help your community be better prepared for a terrorist attack.

Ongoing and Future War Costs

Undersecretary Dov S. Zakheim, the DOD’s chief financial officer, said the U.S. military effort around the world and at home is costing $2.5 billion per month, which includes roughly $500 million for transportation of personnel and equipment to and from Afghanistan, $600 million for mobilization costs, $350 million for air sorties and the time ships spend at sea, and $50 million for combat air patrols over U.S. cities. Other costs include aid to allies such as Pakistan, he said.

The 1991 Gulf War cost about $60 billion, according to the Congressional Budget Office (that is about $80 billion in 2002 dollars). But U.S. allies footed 80% of that bill. The impending war will cost at least that much, possibly much more, and this time around the U.S. does not have many allies willing to publicly support military action, much less pick up the tab. Chief economic policy adviser to the President, Lawrence B. Lindsey caused a stir when he announced that the cost of a war with Iraq could be as high as $100 billion to $200 billion. The White House later distanced itself from Lindsey’s off-the-cuff projection, but a September 23rd analysis by the Democratic staff of the House Budget Committee indicated that if the full costs of an invasion of Iraq were taken into account, including additional personnel costs, fuel, munitions, and post-conflict occupation, the $100 to $200 billion figure cited by Lindsey might not be far off.

The Congressional Budget Office (CBO) has estimated the cost of activities related to possible military operations in Iraq. CBO estimated that the incremental costs of deploying a force to the Persian Gulf (the costs that would be incurred above those budgeted for routine operations) would be between $9 billion and $13 billion. Prosecuting a war would cost between $6 billion and $9 billion a month–although CBO cannot estimate how long such a war is likely to last. After hostilities end, the costs to return U.S. forces to their home bases would range between $5 billion and $7 billion. Further, the incremental cost of an occupation following combat operations could vary from about $1 billion to $4 billion a month.

While war is always expensive, cleaning up afterwards is even pricier. In testimony before Congress in August, retired Colonel Scott Feil, Executive Director of the Role of American Military Power (RAMP), estimated that the post-conflict reconstruction of Iraq could cost up to $16.2 billion a year and could take at least ten years. Samuel Berger, National Security Adviser to President Clinton, estimates that total reconstruction could cost anywhere from $50-150 billion.



12001 Emergency Supplemental Appropriations Act for Recovery from and Response to Terrorist Attacks on the United States



4 2001 Emergency Supplemental Appropriations Act for Recovery from and Response to Terrorist Attacks on the United States




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