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Financial Times (London, England) October 28, 2004

War costs estimate undercuts White House

By Thomas Catan and Demetri Sevastopulo

A top US military official's statement this week that the Bush administration will soon request another Dollars 70bn for military operations in Iraq and Afghanistan has undercut White House efforts to play down reports that the cost of the Iraq war will rise further.

General Paul Kern, the official who heads the US army materiel command, said on Tuesday that the White House was preparing to ask Congress for the additional Dollars 70bn in emergency military funds.

A White House spokeswoman declined to comment specifically on Gen Kern's remarks. "We have not determined what the supplemental request will be," said Claire Buchan. "We have just begun the process."

The White House is expected to submit the next supplemental request for funding in January or February, if President George W. Bush is re-elected.

The figure that the administration is reportedly seeking would be broadly in line with what it requested to fund the war effort in 2004. The rest of the Dollars 87bn supplemental request was earmarked for Iraqi reconstruction - which the White House says will not be included in this year's request.

If anything, analysts said, the figure was likely to be higher as the extended hostilities took their toll on the military. The army is reassessing its needs in the light of spreading Iraqi insurgency and the growing likelihood that it will be in the country for several years.

The military is "making a transition from a short-war mentality to along-war mentality", said John Pike of Globalsecurity.org. For example, the military is seeking to add armour to its Humvees in Iraq and buy additional body armour for its troops. The marines, Mr Pike said, had expressed discontent with kit.

The rising price of oil could also add billions to the fuel bill in Iraq. At the same time, the US is running out of its stockpiles of military hardware.

Before the war, administration officials promised that the invasion and its aftermath would cost the US taxpayer little. "We are dealing with a country that can really finance its own reconstruction and relatively soon," Paul Wolfowitz, the deputy secretary of defence, told Congress at the time.

The Dollars 87bn supplemental budget for Iraq approved last October by Congress included Dollars 66bn to cover military expenses and reconstruction and Dollars 18.4bn for reconstruction. But military costs have been higher than anticipated.

In August Congress approved a further Dollars 25bn in spending to bridge the gap until the next supplemental request early next year. A Dollars 70bn request would bring the cost of the Iraq war to more than Dollars 225bn.

Nancy Pelosi, the Democratic leader of the House of Representatives, said the mounting price was the result of "poor planning". "The war in Iraq has been and will continue to be much more expensive and last far longer than the administration originally intended," she said.


Copyright 2004, The Financial Times Limited