Seven months in, the bill for the Iran War continues to grow. A report released by the Congressional Budget Office (CBO) estimated that the first five months of the Iran War, through August 1, cost the Pentagon $38 billion. The DoD itself told Congress earlier this month the total is even higher: at least $43.6 billion through September 3. CBO estimates that each additional month of conflict could cost another $2–$3 billion, with costs climbing higher still if the violence escalates.
Outside estimates have put the war’s cost well above CBO’s number. One such estimate, from an in-depth report in May, placed the cost of the war’s first 60 days at nearly $72 billion. Much of that gap comes down to differences in what CBO counted and how those costs are calculated. For instance, CBO could not put a price tag on damage to U.S. military bases. That’s partly because the Department of Defense did not respond to CBO’s requests for information. According to the House Budget Committee, the Pentagon’s withholding of such information breaks with historical precedent.
The omitted costs don’t stop at damaged bases. CBO excluded the cost of some lost equipment already slated for replacement, potential foreign aid and diplomatic costs, future maintenance costs, and long-term veterans’ disability and health care costs. Other estimates have put some of those costs in the billions. Add it up, and the true toll on taxpayers is likely well north of what CBO’s $38 billion estimate captures.
The CBO estimate follows the administration’s request for an additional $67.1 billion in supplemental military spending in June. While the administration claimed the funding was necessary to address “urgent needs” related to the Iran War, CBO found that only $42.3 billion appeared to be directly related to the war. That leaves nearly $25 billion, over a third of the request, that CBO did not classify as directly related to the war.
Americans are also facing a serious economic burden from the war beyond the billions going directly to the Pentagon. CBO estimates that economic disruption from the war will leave inflation roughly 0.5 percentage points higher in early 2027 than previously projected. Nowhere is that pressure more visible than at the pump, with U.S. gas prices up about 44% since the war began. Economist Mark Zandi estimated the additional energy costs for American consumers at $115 billion, or $860 per household. That $860 reflects the extra cost of energy, like gasoline, diesel, and jet fuel, and doesn’t account for higher prices for other consumer goods as increased transportation costs work their way through the economy.
The war is also burning through U.S. munitions stockpiles, and there’s no silver bullet waiting to refill them. More than half of CBO’s $38 billion estimate comes from replacing munitions used in the conflict. The easy instinct would be to throw more money at the problem. But replenishing munitions will take years. Congress cannot appropriate five years of production into existence. More money could help increase production, but not enough to change the basic reality of the problem. CBO estimates that rebuilding depleted missile-defense interceptor inventories would probably take at least five years even if production increased.
A recent investigation from ProPublica offers an important example of how dumping money into the munitions procurement industry does not guarantee results. The investigation revealed that the Army spent $533 million on a new General Dynamics artillery factory. The result of that half-billion-dollar investment? Not a single usable shell produced. Expanding the defense industrial base requires new skilled workers, supply chains, and a lot of time, not just government funds.
If Congress and the Pentagon are genuinely worried about dwindling munitions inventories, they should work to rein in the war. In the short term, slowing the rate at which these weapons are consumed would reduce pressures on U.S. inventories faster than simply appropriating additional billions. The longer hostilities continue, the more ordnance will be depleted and the larger the replacement challenge will become. The administration’s supplemental war funding request would help sustain continued operations, which means it would also sustain continued depletion.
The tradeoff for Congress is increasingly clear: critical munitions consumed in Iran must be replaced before they can be available elsewhere, requiring years of production and billions in taxpayer funds. Congress should judge further Pentagon spending, from war supplementals to this year’s NDAA and DoD appropriations bills, not by how many billions it provides, but by whether those dollars leave the United States better prepared for the threats ahead. Until the war ends, handing out additional taxpayer funds to the Pentagon risks worsening the readiness problem it is supposed to solve.
