Congressional Budget Office
Director’s Blog

CBO’s Acting Assistant Director in charge of the National Security Division, Matt Goldberg, testified today before the House Committee on Armed Services about the long-term implications of the fiscal year 2010 budget submission for the Department of Defense (DoD). Today’s testimony is similar to CBO’s testimony before the House Budget Committee last month. Decisions about national defense that are made today—whether they involve weapon systems, military compensation, or numbers of personnel—can have long-lasting effects on the composition of the nation’s armed forces and the budgetary resources needed to support them.

In previous years, CBO used DoD’s Future Years Defense Program (FYDP), which the department typically prepares each fiscal year and submits to the Congress as part of the President’s budget request, as a key source of information for projecting defense spending. This year, however, the Administration did not submit a FYDP. CBO’s projections for fiscal years 2011 through 2028 are based on the President’s 2010 budget request; changes to defense plans announced in early April 2009 by Secretary of Defense Robert M. Gates; and other sources, including press releases and briefing materials.
 
Base Projections of Defense Spending
 
CBO’s base projection of DoD’s current plans averages about $567 billion annually (in constant 2010 dollars) from 2011 to 2028—excluding overseas contingency operations (that is, overseas military operations against hostile forces, such as those in Iraq and Afghanistan). That amount is about 6 percent more than the $534 billion in total obligational authority requested by the Administration in its regular 2010 budget. Four main factors in particular account for the higher resources in the long term:

• The likelihood of continued real growth in pay and benefits for DoD’s military and civilian personnel;
• Projected increases in the costs of operation and maintenance (O&M) for aging equipment as well as for newer, more complex equipment;
• DoD’s plans to develop and field advanced weapon systems to replace many of today’s military systems that are nearing the end of their service lives; and
• Investments in new capabilities, such as advanced intelligence, surveillance, and reconnaissance systems, to meet emerging security threats.

Rather than having funding provided through supplemental and emergency appropriations, the Administration has requested a full year of anticipated appropriations for overseas contingency operations along with its regular defense budget request for fiscal year 2010. The Administration’s request of $130 billion would support 100,000 service members in Iraq and 68,000 in Afghanistan. CBO does not have access to DoD’s estimates of costs for overseas contingency operations in 2011 or later that would have been contained in the 2010 FYDP.
 
Potential for Higher Costs
 
The long-term demand for defense resources could be larger than CBO’s base projections. CBO has developed a scenario under which, consistent with the Status of Forces Agreement signed by the governments of Iraq and the United States in November 2008, all U.S. troops would be withdrawn from Iraq by December 31, 2011. Under that scenario, the total number of U.S. military personnel deployed worldwide would decline to 30,000 starting in fiscal year 2013, although those troops would be in unspecified locations and not necessarily in Iraq or Afghanistan. CBO estimates that supporting that number of deployed service members would require recurring annual appropriations of about $20 billion in 2010 dollars. CBO refers to those costs as “contingency unbudgeted costs.”
 
Other factors also could increase defense resources above CBO’s base projections. There could be higher costs for developing and purchasing new weapon systems. In addition, as has been true historically, medical costs could rise more rapidly than DoD has assumed. Accounting for those and other factors, as well as contingency costs, CBO has projected the “total unbudgeted costs” of current defense plans. The inclusion of total unbudgeted costs increases the overall projection to an annual average of $624 billion through 2028, or 17 percent more than the regular funding requested for 2010. Some 38 percent of the total unbudgeted costs between 2013 and 2028 are associated with overseas contingency operations.

Today, CBO’s Acting Assistant Director of the National Security Division testified before the House Budget Committee about the long-term implications of the fiscal year 2010 budget submission for the Department of Defense (DoD). Decisions about national defense that are made today—whether they involve weapon systems, military compensation, or numbers of personnel—can have long-lasting effects on the composition of the nation’s armed forces and the budgetary resources needed to support them.

In previous years, CBO used DoD’s Future Years Defense Program (FYDP), which the department typically prepares each fiscal year and submits to the Congress as part of the President’s budget request. This year, CBO’s projections for fiscal years 2011 through 2028 are based on the President’s 2010 budget request; changes to defense plans announced in early April 2009 and subsequently by Secretary of Defense Robert M. Gates; and other sources, including press releases and briefing materials.

Base Projections of Defense Spending

CBO’s base projection of DoD’s current plans excluding overseas contingency operations (those in Iraq, Afghanistan, and elsewhere) would average about $567 billion (in constant 2010 dollars) annually from 2011 to 2028.  That amount is about 6 percent more than the $534 billion in total obligational authority requested by the Administration in its regular 2010 budget. Four main factors in particular account for the higher resources in the long term:

• The likelihood of continued real growth in pay and benefits for DoD’s military and civilian personnel;
• The projected increases in the costs of operation and maintenance for aging equipment as well as for newer, more complex equipment; 
• DoD’s plans to develop and field advanced weapon systems to replace many of today’s military systems that are nearing the end of their service lives; and
• Investments in new capabilities, such as advanced intelligence, surveillance, and reconnaissance systems, to meet emerging security threats.

Rather than having funding provided through supplemental and emergency appropriations, the Administration has requested a full year of anticipated appropriations for overseas contingency operations along with its regular defense budget request for fiscal year 2010. The Administration’s request of $130 billion would support 100,000 service members in Iraq and 68,000 in Afghanistan. CBO does not have access to DoD’s estimates of costs for overseas contingency operations in 2011 or later that would have been contained in the 2010 FYDP.

Unbudgeted Costs

The long-term demand for defense resources could be larger than CBO’s base projections. CBO has developed a scenario under which, consistent with the Status of Forces Agreement signed by the governments of Iraq and the United States in November 2008, all U.S. troops would be withdrawn from Iraq by December 31, 2011. Under that scenario, the total number of U.S. military personnel deployed worldwide would decline to 30,000 starting in fiscal year 2013, although those troops would be in unspecified locations and not necessarily in Iraq or Afghanistan. CBO estimates that supporting that number of deployed service members would require recurring annual appropriations of about $20 billion. CBO refers to those costs as “contingency unbudgeted costs.”

Other factors also could increase defense resources above CBO’s base projections. There could be higher costs for developing and purchasing new weapon systems. In addition, as has been true historically, medical costs could rise more rapidly than DoD has assumed. Accounting for those and other factors, as well as contingency costs, CBO has projected the “total unbudgeted costs” of current defense plans. The inclusion of total unbudgeted costs increases the overall projection to an annual average of $624 billion through 2028, or 17 percent more than the regular funding requested for 2010. Some 38 percent of the total unbudgeted costs between 2013 and 2028 are associated with overseas contingency operations.

In February 2009, President Obama described his strategy for ending the war in Iraq, and announced that all U.S. combat operations there would cease by the end of August 2010 and all troops would be withdrawn by December 2011. In response to a request by the Chairman of the Subcommittee on National Security and Foreign Affairs of the House Committee on Oversight and Government Reform, CBO released a letter today outlining the costs for ceasing military operations in Iraq under the Administration’s plan and under four alternative timetables for withdrawal. 

The Administration’s Plan

According to the timeline described by Administration officials, the approximately 128,000 U.S. troops currently in Iraq would remain there through the Iraqi elections scheduled for January 2010. After that, the number of U.S. forces would decline to no more than 50,000 by the end of August 2010. In accordance with the Status of the Forces Agreement signed by Iraq and the United States in November 2008, the remaining 50,000 U.S. troops must leave the country by the end of December 2011. CBO estimates that to comply with that timeline, the Administration will need to withdraw military personnel from Iraq in two stages; one between the Iraqi election and August 2010, when almost 80,000 U.S. troops will be removed over a period of seven months, and the other before the end of calendar year 2011, when 50,000 troops will need to be withdrawn. 

CBO estimates that under the Administration’s plan, costs related directly to the U.S. forces conducting the war in Iraq—also called Operation Iraqi Freedom (OIF)—would total $156 billion over the 2009-2014 period, with annual costs decreasing from $69 billion in 2009 to less than $500 million in 2014. Since all U.S. forces would be withdrawn by the second quarter of 2012, nearly all of the costs from 2012 to 2014 (totaling less than $10 billion) would be for repairing equipment that is used in Iraq and returned to the United States and for replacing equipment lost in the conduct of the war.

Alternative Timetables

CBO examined several alternative timetables for withdrawal of U.S. forces from Iraq. Three would withdraw all U.S. forces before the end of December 2011, as planned by the Administration:

• Option 1: Remove U.S. forces beginning in October 2009 at a rate of 14,400 troops per month to complete the withdrawal by the end of June 2010.

• Option 2: Draw forces down more rapidly—at a rate of 17,500 service members per month—starting in October 2009 and removing all troops by May 2010.

• Option 3: Conduct the withdrawal at the same rate as Option 2—17,500 troops per month—but begin after Iraq’s elections, scheduled for January 2010. Under this option, withdrawal would be complete by September 2010.

CBO also examined another plan, Option 4, which would withdraw U.S. forces more slowly and steadily than under the Administration’s plan, at a rate of 5,500 troops per month over 23 months beginning after the Iraqi elections, with all troops withdrawn by the end of December 2011.

CBO identified how some of OIF’s direct costs would change, from the estimated $156 billion over the 2009-2014 period, under the four alternative timetables. Options 1 and 2 would provide the greatest savings—$50 million and $54 million, respectively—as troops would be withdrawn at a rapid pace beginning in October 2009 before the Iraqi elections. Savings relative to the Administration’s plan would be smaller, approximately $34 billion, if the withdrawal of U.S. forces from Iraq did not begin until after the elections and troops were withdrawn by September 2010, as in Option 3. The more gradual withdrawal CBO analyzed—Option 4—would cost about $5 billion more than the Administration’s plan.

CBO’s report describes the procedures involved in withdrawing troops and equipment from Iraq and some of the logistical constraints that may apply. CBO did not evaluate the operational or security disadvantages associated with drawing down U.S. forces in Iraq earlier or more rapidly than planned by the Administration. The withdrawal of significant numbers of U.S. military personnel before the Iraqi elections could increase security risks during a time of high tensions in Iraq.

This letter was prepared by Francis Lussier of CBO’s National Security Division.

Today CBO released a study that examines the Veterans Health Administration’s (VHA’s) experience with quality improvement and health information technology. The assessment also examines how VHA’s system serves its patients.  The information contained in this report may prove useful to private-sector health providers who are working to improve the quality of care in their own facilities as well as to analysts and decision makers considering how veterans’ health care might be affected by proposals for health care reform.

Two decades ago, the veterans’ health system focused largely on inpatient hospital care and had a poor reputation for quality.  Beginning in the mid-1990s, the agency undertook a major transformation effort aimed at improving the quality and efficiency of the care it provides to its patients. VHA eliminated underutilized inpatient beds and facilities, expanded outpatient clinics, and restructured eligibility rules. A major focus of the transformation was the tracking of a number of performance indicators—including quality-of-care measures—and holding senior managers accountable for improvements in those measures.

Since then, VHA has achieved improvements in the quality indicators it measures and for which it holds its staff accountable.  The agency has relied increasingly on electronic health records and other information technology to support efforts to coordinate health care delivery.  Many of VHA’s quality improvement programs use data from computerized clinical records to track both process and outcome measures, including risk-adjusted mortality and morbidity.  Those programs have helped VHA to recognize problems in specific health care facilities as well as to improve performance throughout the agency.  Additionally, much of its own research has focused on the importance of putting evidence-based medicine into practice.

Most veterans who use VHA facilities also seek care from other providers, and this can make it difficult to analyze the quality of care and ensure that patients are receiving services recommended by clinical practice guidelines.  These patterns of health care utilization also highlight the importance of expanding efforts to share health information not just between VHA and the Department of Defense, but also with private providers.

Determining whether VHA is a cost-effective provider of care is not simply a matter of comparing spending per enrollee. VHA spending per enrollee does not reflect the full amount of medical care received by those veterans from all sources.  In this assessment, CBO took into account changes in the mix of enrollees and their reliance on VHA care and found that VHA’s spending per enrollee was relatively flat from 1999 through 2002, but since then it has risen about as rapidly as spending per enrollee in the Medicare program. It is likely that rapid increases in annual appropriations for VHA, efforts to reduce waiting lists within the system, and expansion of mental health and other specialized services have contributed to the recent growth in spending per enrollee.

The Department of Defense’s (DoD’s) proposed budget for fiscal year 2010 includes a number of significant changes in planned military programs. Many of the issues addressed in the budget have been apparent for some time to analysts in CBO’s National Security Division. (J. Michael Gilmore led this division from 2001 until earlier this year; Matthew S. Goldberg is CBO’s Acting Assistant Director for National Security.) Indeed, many of the programmatic changes just proposed have been examined by CBO in recent publications, including:

• Budget Options, Volume II (August 2009)
• Options for Combining the Navy’s and the Coast Guard’s Small Combatant Programs (July 2009)
• The Effects of Proposals to Increase Cost Sharing in TRICARE (June 2009)
• An Analysis of the Army’s Transformation Programs and Possible Alternatives (June 2009)
• Alternatives for Modernizing U.S. Fighter Forces (May 2009)
• Options for Deploying Missile Defenses in Europe (February 2009)
• The Army’s Wireless Communications Programs (February 2009)
• Long-Term Implications of the Fiscal Year 2009 Future Years Defense Program (January 2009)
• Resource Implications for the Navy’s Fiscal Year 2009 Shipbuilding Program (June 2008)

Here are some examples of relevant CBO analysis:

• Based on the five-year plan that accompanied last year’s budget request, DoD was planning to expand the active Army from 42 combat brigades to 48 combat brigades by 2011. In a budget option that has long been under formulation (Option #050-1, page 6), CBO noted that the Army would probably be unable to identify 23,000 additional soldiers (beyond those already identified) to fully populate six new brigades under the current cap on total Army personnel. One option analyzed by CBO would explicitly relax the cap and add 23,000 soldiers to the force, at a total cost of about $16 billion over the next five years.
• The Army has been developing its Future Combat System (FCS) program which would encompass eight new models of manned combat vehicles as well as new unmanned aerial and ground vehicles, sensors, and munitions. All of these components would be linked by advanced communications networks into an integrated combat system. Starting with a report released in August 2006, CBO has evaluated several alternatives to the FCS program that would forgo the development of new combat vehicles and instead “spin out” FCS improvements in communications and other systems to upgrades of existing tanks and fighting vehicles. Most recently, CBO estimated in a budget option that these changes to the FCS program could save the Army roughly $5 billion in outlays over the next ten years (Option #050-4, page 10).
• CBO evaluated DoD’s practice of hiring contractors to provide decision-makers with analyses and various other support activities—so-called contract advisory and assistance services. CBO analyzed an alternative that, in conjunction with “spinning out” the FCS program and curtailing or cancelling selected other weapon-system procurements, would reduce the volume of advisory and assistance services by 20 percent. Along somewhat similar lines, Secretary Gates announced a plan to reduce the number of support service contractors from the current 39 percent of DoD’s total workforce to the pre-2001 level of 26 percent and replace them with full-time government employees.

CBO released a study today that examines alternatives to current Navy and Coast Guard long-term procurement strategies for their small surface ships known as small combatants. As articulated in their respective long-term shipbuilding plans, the Navy and the Coast Guard intend to purchase a total of 83 small combatants. CBO estimates these purchases would cost more than $47 billion over the next 20 years.

The Navy is building two versions of its new combat ship designed for operations near coastlines (the littoral zone). Also, the Coast Guard is building replacements for its existing classes of high-endurance cutters and medium-endurance cutters. As the designation “small combatant” implies, the Navy’s two versions of littoral combat ships (LCSs) and the Coast Guard’s national security cutters (NSCs) and offshore patrol cutters (OPCs) are designed to be significantly shorter in length, lighter in weight, and shallower in draft than most Navy surface warships (carriers, amphibious ships, cruisers, and destroyers).

Although all four types of ship are about the same size, they are designed to perform different missions. In general, The Navy’s LCSs are designed to have less range than Coast Guard cutters but to operate at much greater speeds and close to shore during wartime as part of a naval battle network. The Coast Guard ships are meant to operate independently at sea for long periods of time and at some distance from the shore and not to engage in major combat operations.

In the early stages of implementing the ship programs, however, the Navy and the Coast Guard have encountered various challenges—including cost overruns and construction problems. As a result of those delays and cost overruns, some members of the Congress and independent analysts have questioned whether the Navy and the Coast Guard need to buy four different types of small combatant and whether—in spite of the services’ well-documented reservations about using similar hull designs—the same type of hull could be employed for certain missions.

To explore that possibility, CBO examined three alternatives to the Navy’s and the Coast Guard’s current plans for these four ships.

• Option 1 explores the feasibility of having the Coast Guard buy a variant of the Navy’s LCS—to use as its offshore patrol cutter.
• Option 2 examines the effects of reducing the number of LCSs the Navy would buy and substituting instead a naval version of the Coast Guard’s national security cutter.
• Option 3 examines the advantages and disadvantages of having the Coast Guard buy more national security cutters rather than incur the costs of designing and building a new ship to perform the missions of an offshore patrol cutter.

According to CBO’s estimates, all three alternatives and the services’ plans would have similar costs, regardless of whether they are calculated in terms of acquisition costs or total life-cycle costs. CBO’s analysis also indicates that the three alternative plans would not necessarily be more cost-effective or provide more capability than the services’ existing plans. Specifically, even if the options addressed individual problems that the Navy and Coast Guard might confront with their small combatants, the options would also create new challenges.

Eric J. Labs of CBO’s National Security Division wrote this report. Eric has been at CBO for 14 years and holds a Ph.D. from MIT. With three children, two dogs, and two cats, Eric’s hobby is sleeping.

The TRICARE program provides health care for members of the uninformed services, for military retirees, and for their families—the more than 9 million people eligible to use its integrated system of military health care facilities and providers and regional networks of contracted civilian providers. User fees for TRICARE beneficiaries have remained the same (or even been reduced) since the mid-1990s, when the current program was first set up. At the same time, taxpayers’ costs for the program have risen dramatically. The Department of Defense (DoD) has not requested any TRICARE fee increases for the upcoming fiscal year 2010. In light of previous proposals, however, a CBO report released today looks at the impact of possible cost-sharing changes in TRICARE on the federal budget.

In 2008, DoD’s spending on health care was $42 billion, or about 6 percent of DoD’s total funding; under current policy, CBO projects that the share of defense spending devoted to health care will rise sharply further in coming years. In its budget submissions for 2007, 2008, and 2009, DoD proposed that enrollment fees, deductibles, and copayments of some TRICARE beneficiaries (generally retirees between the ages of 38 and 65) be increased to encourage more-efficient use of the system and reduce medical spending.

In its analysis, CBO compared the proposed increase in fees for military retirees with the growth seen in several measures of nonmilitary health care spending. It found that the proposed enrollment fees accurately adjusted for trends in spending growth observed in the civilian sector since 1995. For example, if the Prime plan’s enrollment fee of $460 for family coverage had grown at the same pace as the average premium in civilian health plans, the amount today would be close to the new fees proposed in DoD’s 2009 budget submission. Nevertheless, the level of DoD’s proposed fees would still be below premiums commonly seen in civilian plans. The average annual health insurance premium for family coverage in a health maintenance organization in 2008, for example, was about $13,100, of which the average worker’s contribution was about $3,400. Under the proposal, most DoD retirees who were not yet eligible for Medicare would have paid $1,100 per year to enroll their family in TRICARE Prime in 2011.

CBO also determined, on the basis of currently available research, that DoD used reasonable assumptions about TRICARE beneficiaries’ responses to some of the changes in the 2009 proposal and that the actual reductions in spending could be larger than DoD has foreseen. CBO also found, however, that DoD did not include in its estimates the effects that increased cost sharing for TRICARE might have on other federal programs—such as Medicaid and the Federal Employees Health Benefits (FEHB) program—and on revenues. Those effects would decrease, though to a relatively small degree, the reductions in spending that might be realized from increasing TRICARE beneficiaries’ costs.

This paper was written by Carla Tighe Murray of CBO’s National Security Division. Carla has been at CBO for seven years and holds a Ph.D. from the University of Illinois (Urbana-Champaign).  She enjoys yoga and gourmet cooking.

The near- and long-term implications of the Modularity Initiative and the Future Combat Systems (FCS) programs, which would change how the Army is organized and equipped, are examined in a CBO study released today. Also explored in the study are three alternatives for modernizing the Army’s combat forces using modified versions of the FCS program.

Before changes were announced in April by Secretary of Defense Robert Gates, the FCS program would have, among other things, replaced the Army’s heavy tracked armored vehicles developed in the 1960s and 1970s with lighter and more mobile combat vehicles that would be equally as survivable. The Modularity Initiative would reorganize the Army’s warfighting forces from divisions containing 12,000 to 17,000 or more soldiers to a larger number of smaller, interchangeable, and independent teams of 3,000 to 4,000 soldiers. Army leaders have contended that the FCS program and Modularity Initiative would yield an Army that could respond to crises around the world more quickly and that would be more mobile and technically sophisticated—and, hence, more effective—once it arrived.

CBO’s analysis of the Modularity Initiative shows that the program has cost more and yielded fewer benefits than were originally estimated:

• The Army has had to add personnel to support the additional units;
• The planned increases in personnel are unlikely to be sufficient to fully support the force structure of 76 brigade combat teams (BCTs) that was planned at the end of 2008;
• Although modular BCTs might require less time to prepare to respond to an overseas crisis than their premodular predecessors, they require roughly the same amount of time to transport their equipment overseas; and
• The costs to carry out the initiative have grown beyond the initial estimate of $21 billion and may total more than $140 billion through 2013.

CBO’s analysis also reaches the following conclusions concerning the Army’s FCS program included in the previous Administration’s 2009 plan and associated modernization programs:

• The FCS program would have fielded a full set of equipment to less than 20 percent of the Army’s BCTs and would not have been completed until 2030.
• Although one of the main goals of the FCS program was to speed the movement of Army combat units overseas, replacing the current armored vehicles with FCS manned vehicles would not have significantly reduced transportation times.
• According to the Army’s estimates, the annual costs of the FCS program and its associated Spin-Out program could have approached $10 billion at their peak, an expenditure that could have been difficult to afford given other demands on the Army’s budget.
• Alternative approaches to introducing FCS technologies into the Army’s combat units—approaches that would eliminate all or part of the program’s ground vehicles while retaining its communications network and, in some cases, its components with sensors to detect enemy troops and their movement—would yield annual savings of $3 billion to $8 billion in the cost of FCS-related programs included in the previous Administration’s 2009 plan.
• Because FCS manned vehicles would not have replaced the armored combat vehicles in all of the Army’s BCTs, additional annual funding of $2 billion to $4 billion could have been required over the next 20 years to modernize vehicles that the Army will retain indefinitely.

In April, Secretary of Defense Robert Gates recommended changes to these programs, including:

• Reducing the active Army’s goal for combat units by 2013 from 48 BCTs to 45 brigade combat teams, and
• Canceling the manned vehicle portion of the FCS program and accelerating the spin-out of FCS technologies to all of the Army’s brigade combat teams, rather than just infantry brigades.
  Although the administration’s 2010 request was submitted shortly before CBO published this report, that request did not contain sufficient programmatic details to allow CBO to conduct a complete reassessment of either the revised Modularity Initiative or the FCS program.

Frances M. Lussier of CBO’s National Security Division prepared the paper.  When not performing her CBO duties, Fran is an accomplished choral singer and amateur ornithologist.

The United States Air Force, Navy, and Marine Corps are in the process of replacing most of today’s fighter aircraft with new F/A-18E/F, F-22, and F-35 Joint Strike Fighter (JSF) aircraft. Although procurement plans call for purchasing about 2,500 aircraft over the next 25 years, the services are projecting that those purchases will be unable to keep pace with the need to retire today’s aircraft as they reach the limit of their service life.

Today CBO released a study of U.S. fighter forces that compares the size and capability of today’s forces with the forces that would be fielded under the Department of Defense’s (DoD’s) modernization plans and several alternative plans that would offer varying levels of capability and require varying levels of budgetary commitment. CBO’s analysis of DoD’s plans and the alternatives included comparisons of the number of aircraft in each force, the types and technological sophistication of those aircraft, and their aggregate capacity to carry air-to-ground and air-to-air weapons. Using those criteria, CBO found the following:

• Under DoD’s procurement plans, fighter inventories are likely to fall below the services’ stated goals in the coming years. Nevertheless, many military capabilities would remain equal to or improve relative to today’s capabilities because of the enhanced performance that is expected to result from the technological advances that have been incorporated into the latest generation of fighters. Some of those improvements might be offset by the increased capabilities of potential adversaries, however.
• Alternative approaches to modernization that included purchasing less advanced but less costly fighter aircraft could avoid inventory shortfalls, achieve long-term cost savings, or both. They would not offer the same capability improvements (especially in terms of the ability to evade an adversary’s air defenses) that would be realized by purchasing JSFs, although they could maintain or improve upon today’s level of capability.
• Force structures in which some fighters are replaced with smaller numbers of attack aircraft possessing longer ranges, larger weapons loads, or both, could be fielded at costs similar to current plans. Compared to forces equipped with fighters alone, forces equipped with a mix of fighters and such attack aircraft would offer improvements such as increased basing flexibility and persistence over the battlefield but would have decreased air-to-air combat capabilities.

The study was written by Dave Arthur and Kevin Eveker.

As part of ongoing efforts to protect the United States and its allies from attack by ballistic missiles, the U.S. Missile Defense Agency (MDA) is working to deploy a missile defense system in Europe to “defend allies and deployed forces in Europe from limited Iranian long-range threats and expand protection of [the] U.S. homeland.” As proposed, the system would be in the field by 2013 and would include interceptor missiles in silos to be built in Poland, a tracking radar in the Czech Republic, and another radar at an unspecified location near Iran.

CBO’s study of this system, released today, compares the potential cost and performance of MDA’s proposed European system with the cost and performance of three other options for deploying missile defenses in Europe:

• Standard missile interceptors located on U.S. Navy Aegis ballistic missile defense ships operating at three locations around Europe, supported by two transportable radars;
• Ground-based standard missile interceptors operating from mobile launchers located at two existing U.S. bases, supported by two transportable radars; and
• Ground-based kinetic energy interceptors (a new high-acceleration interceptor under development at MDA), also operating from mobile launchers located at two existing U.S. bases and supported by two transportable radars.

CBO developed these alternatives using components that are already being planned rather than entirely new systems. Like MDA’s proposal, the alternatives are all midcourse-phase defense systems (they would intercept an enemy missile after its rocket booster had burned out and the missile was “coasting” on a ballistic trajectory above the atmosphere). (Note for the uninitiated: the report has an introduction to ballistic missiles– you can find it in Appendix A.)  

CBO compared MDA’s proposed deployment and the alternatives for the defense that they provide to Europe, the additional defense they would provide to the U.S. relative to existing system, their costs, and when the alternatives could be available. Using those four criteria, CBO found the following:

• Defense of Europe. All of the alternatives CBO considered would provide defense of most of Europe roughly equivalent to the defense provided by MDA’s proposal against most types of ballistic missiles that Iran is thought to have developed or could develop in the future. Because the alternatives CBO considered would locate interceptors closer to Iran than MDA’s planned system, they would generally provide more extensive defense of southeastern Europe than would MDA’s proposal. Moreover, because they would be composed of mobile or transportable components, deploying the alternative systems would not require building permanent facilities—including missile silos—at European sites.
• Extended defense of the United States. A second goal of MDA’s proposed European system is to give the United States an extra layer of defense against potential Iranian intercontinental ballistic missiles. CBO’s analysis indicates that by 2012 systems already in place at two bases in the United States would protect more than 99 percent of the U.S. population from this threat. MDA’s proposed European system would extend defensive coverage to the other 1 percent of the U.S. population. It would also provide redundant defense from a third interceptor site for all of the continental United States, giving system operators more flexibility by creating an opportunity to launch a second interceptor from the United States, if necessary. None of the alternatives considered by CBO provide as much additional defense of the United States.
• Costs. For roughly the same cost as MDA’s European system—a total of about $9 billion to $14 billion over 20 years—the United States could deploy either of the ground-based alternatives. The ship-based alternative would cost almost twice as much as MDA’s proposal—a total of about $18 billion to $26 billion over 20 years—largely because CBO assumed that the Navy would need to buy additional ships to operate it.
• Availability. The alternatives that CBO examined might not be available as early as MDA’s proposed European system.

Kudos to Michael Bennett of the National Security Division for the development of this report, and to Maureen Costantino, who prepared the many interesting and informative maps and figures.