Cost in Military Operating Expenditures and Aid, and Prospects for "Transition.”
It is surprisingly difficult to get a meaningful estimate of the total cost of the Afghan conflict, total spending on Afghan forces and total spending on various forms of aid. More data are available on US efforts – which have dominated military and aid spending, but even these data present serious problems in reliability, consistency, and definition. Moreover, it is only since FY2012 that the US provided an integrated request for funding for the war as part of its annual budget request. The data for the period before FY2009 are accurate pictures of the Department of Defense request, but there is only a CRS estimate of total spending the previous years.
It addresses the fiscal cost to the US of the Afghan War from FY2000-FY2013. It provides estimates of total cost, cost to the Department of Defense, and estimates concerning aid costs to State, USAID, and other federal agencies. It also reports on the total cost of international aid when this takes the form of integrated aid to Afghan development and Afghan forces – a fraction of total aid spending. No reliable estimate exists of total international aid to Afghanistan, since so much of this aid has been direct and has not passed through the Afghan Central government.
The resulting figures provide important insights for “transition.” They show the scale of past US efforts, how the aid has been allocated, and the differences between the total aid appropriated during the course of the war, the amount obligated (around 60% of the amount appropriated), and the amount actually disbursed (around 45% of the appropriation).
Several points are clear:
The vast majority of aid went to the Afghan security forces and not development.
Most aid was very erratic in annual levels of effort, making it extremely difficult to plan the most effective use of the money and ensuring that program continuity was not possible.
The bulk of the total spending and aid has been allocated since FY2009, and came after the insurgency had reached high levels. It is a clear case of too much, too late.
The surge in aid spending creates the irony that the maximum actual cash flow – “disbursements” – is only occurring now that transition is in place and major cuts are coming between 2012 and 2014.
The data only tell the amount of money made available on a total category basis. They do not tell how much money actually reached Afghanistan, they do not tie spending to any clear objectives, they do not reflect any effective contracting and auditing system, and there are no measures of effectiveness or success.
This latter set of points is critical. No one who has served in government, or observed it, will ever claim that the ability to allocate and spend money is a measure of effectiveness. After more than a decade of war, this is in practice the total limit of Department of Defense, State Department and USAID reporting. The only exceptions are limited audit coverage by the Special Inspector General for Afghanistan (SIGAR), reports by the GAO, and some audits by the inspector generals of given Departments.
Not only did the money come far too late to prevent the rise of a major insurgency, when it did come, it came in areas where there were no effective overall planning, management, and contacting systems. No adequate fiscal controls, and no real measures of effectiveness. The system virtually invited waste, fraud, and abuse.
It is important to note that reforms have taken place in many areas of contracting, and there is now better auditing. The Afghan government has also promised important reforms in its control of spending and efforts to reduce corruption.
The fact remains, however, that if the CRS and OMB figures for FY2001-FY2013 that follow are totaled for all direct spending on the war, they reach $641.7 billion, of which $198.2 billion – or over 30% – will be spent in FY2012 and FY2013. This is an incredible amount of money to have spent with so few controls, so few plans, so little auditing, and almost no credible measures of effectiveness.
It is also clear that the end effect has been to sharply raise the threshold of corruption in Afghanistan, to make transition planning far more difficult, and raise the risk that sudden funding cuts will undermine the Afghan government’s ability to maintain a viable economy and effective security forces.