Orszag: Ending the Iraq War Saves Money

From budget director Peter Orszag, who posts an occasional "blog" at OMB:

The President is committed to responsibly winding the war. I don’t do foreign policy, but I can tell you this: ending wars saves money – and so the Administration’s budget includes savings from ramping down overseas military operations over time.

Yet critics are claiming that, in calculating the amount saved by ramping down operations in Iraq and Afghanistan, the Administration is wrong to compare its proposed funding levels to the level in 2008—the last year in which overseas operations were fully funded. Such criticisms are inconsistent not only with common sense but also established practices of budget accounting (and even what the critics themselves have said in the past).

The last time the United States began to ramp down from a prolonged, expensive military engagement, President George H.W. Bush was in office. With the Cold War having just been won, President Bush, for the 1991 budget, proposed a deficit reduction package that included substantial reductions in defense funding. Read more