Sticker Shock and Awe — The Astronomical Cost of America’s Wars

America spent far more on the Second World War than all its other wars combined, including Iraq and Afghanistan.

America spent far more on the Second World War than all its other wars combined, including Iraq and Afghanistan.

The Cost of Major U.S. Wars provides present day dollar figures (adjusted for inflation) for every U.S. war from the Revolution to the 1991 Persian Gulf War.”

ARMED CONFLICTS DO HARM to more than just the bodies and minds of those unfortunate enough to be swept up in them. They exact a devastating toll on nations’ finances as well. Need proof? Look no further than the staggering cost of the decade old War on Terror. The website Cost of War maintains a real time ticker that tracks in dollars the financial burden the Iraq War and the war in Afghanistan have placed on the American economy. As of the moment of this publishing, the totals were:

Iraq War: $812.4 Billion

Afghanistan War: $626.5 Billion

But how does the financial impact of these two conflicts compare to other American wars in the 18th, 19th and 20th centuries? Well, one defence budgetary specialist working for the U.S. Congressional Research Center crunched the numbers in 2010. The report, entitled Cost of Major U.S. Wars by Stephen Daggett, provides present day dollar figures (adjusted for inflation) for every U.S. war from the Revolution to the 1991 Persian Gulf War. Here is what he discovered:

The War of Independence: $2.4 Billion

The Battle of Bunker Hill. (Image source: WikiCommons)

The Battle of Bunker Hill. (Image source: WikiCommons)

Between 1775 and 1783, the 13 colonies borrowed and spent a total of $101 million fighting for independence from Great Britain. This is the modern day equivalent of $2.4 billion – quite a bargain to establish a new country.

The War of 1812: $1.5 Billion

The Battle of New Orleans . (Image source: WikiCommons)

The Battle of New Orleans . (Image source: WikiCommons)

A generation after achieving nationhood, America went to war again with Great Britain, this time over maritime rights. The widely unpopular two-and-a-half-year conflict, which resolved little and very nearly led to the secession of the New England states, sapped the young republic’s treasury of $90 million, roughly the equivalent of $1.5 billion today. That was 2 percent of the country’s GDP at the time.

The Mexican American War: $2.3 Billion

The storming of Chapultepec. (Image source: WikiCommons)

The storming of Chapultepec. (Image source: WikiCommons)

Fought between 1846 and 1848, the war with Mexico for control of what is now Texas, Arizona, California and New Mexico cost Washington $71 million or $2.3 billion in today’s terms. That was about 1.4 percent of the U.S. GDP.

The Civil War: $59 Billion

Union troops encamped near Fredericksburg. (Image source: WikiCommons)

Union troops encamped near Fredericksburg. (Image source: WikiCommons)

The war to preserve the Union set the federal government back more than all wars to that point combined, and represented a staggering 11.3 percent of the northern state’s GDP. All told, the Civil War cost Washington more than $3 billion in the 1860s, which would represent $59 billion today. Add to that the cost of the war for the 11 Confederate states, which was $1 billion then, or about $20 billion in 2013 dollars. In fact, the four year conflict was 12 times more expensive than all the other American wars up to that point put together.

The Spanish American War: $9 Billion

The USS Olympia in action during the Spanish American War. (Image source: WikiCommons)

The USS Olympia in action during the Spanish American War. (Image source: WikiCommons)

The war with Spain in 1898 to 1899 came in at $280 million at the time, or just over $9 billion in 21st century currency.

World War One: $334 Billion

Doughboys return home after the 1918 Armistice. (Image source: WikiCommons)

Doughboys return home after the 1918 Armistice. (Image source: WikiCommons)

The Great War was entering its final year by the time America joined the fight against Germany. Despite that, the U.S. Treasury spent the modern day equivalent of $334 billion defeating the Kaiser or roughly 13 per cent of the American GDP. At the time, the commitment totalled the then mind boggling sum of $20 billion.

World War Two: $4 Trillion

The raising of the U.S. flag on Iwo Jima, 1945. (Image source: WikiCommons)

The raising of the U.S. flag on Iwo Jima, 1945. (Image source: WikiCommons)

America’s contribution to the First World War would pale in comparison with final tab for the Second World War. Washington spent more than a third of the nation’s GDP in the war’s final year (35 percent) and $300 million in 1940s dollars in total. Today, that would equal more than $4 trillion. Crushing the Axis cost the American people far more than all other U.S. wars before and since combined. See the chart below for a full appraisal.

Korea: $341 Billion

A GI rests on a Chinese bunker on Hill 902. (Image source: WikiCommons)

A GI rests on a Chinese bunker on Hill 902. (Image source: WikiCommons)

Between 1950 and 1953, the U.S. poured $30 billion into pushing the communists back over the 38th Parallel or just over 4 percent of the nation’s GDP at the time. That would represent $341 billion in today’s money.

Vietnam: $700 Billion

U.S. Air Cav troops in the Ia Drang Valley, 1965. (Image source: WikiCommons)

U.S. Air Cav troops in the Ia Drang Valley, 1965. (Image source: WikiCommons)

America’s war against Hanoi was a $111-dollar misadventure, which at its peak in 1968 represented 2.3 percent of the U.S. GDP. The war today would cost Washington about $700 billion, which is comparable to either of the wars in Afghanistan or Vietnam.

Persian Gulf War: $100 Billion

F-15E Strike Eagles on a runway in Saudi Arabia during the build up to the 1991 Persian Gulf War. (Image source: WikiCommons)

F-15E Strike Eagles on a runway in Saudi Arabia during the build up to the 1991 Persian Gulf War. (Image source: WikiCommons)

The six week air war and 100 hour ground campaign to eject Iraqi forces from Kuwait in 1991 set the U.S. taxpayer back a relatively modest $61 billion in 1991, just over $100 billion in today’s terms. The war represented only 0.3 of the nation’s GDP.


 

BREAKDOWN — Wartime Spending at a Glance

Sherman tanks on a Detroit assembly line. (Image source: WikiCommons)

Sherman tanks on a Detroit assembly line. (Image source: WikiCommons)

TO PUT THESE different dollar amounts in perspective, we summarized the data. The visuals speak for themselves:

graph2

graph

6 comments for “Sticker Shock and Awe — The Astronomical Cost of America’s Wars

  1. 3 April, 2013 at 4:47 pm

    Just as a side note (rather, an unreferenced feeling of mine) is that of the cost of the development of the atomic bombs likely was a large explanation for the cost spike. We also have to include American production of all assets (planes, ships, tanks…) in the waning months likely were scrapped or made obsolete; nevertheless, the manufacturing machine could not be stopped with the flick of a switch. Just my two cents.

    • 3 April, 2013 at 4:50 pm

      I think the numbers speak to the unprecedented shift of the American economy to a war footing. 35% of the GDP in 1945 was going towards the effort. That’s astounding. There were over 18,000 B-24s produced and that’s just one aircraft type!!! I have to admit, the numbers really took on a life of their own when I put them in chart form.

  2. 3 April, 2013 at 4:48 pm

    The four legged or the four wheeled kind? 🙂

    • 3 April, 2013 at 6:04 pm

      Ignore the four legged remark. It was for an entirely different blog. I have no idea how it could have jumped here! 🙂

  3. Daniel
    4 April, 2013 at 7:52 pm

    Does this include the opportunity cost of having millions of men under arms rather than in the productive economy? I wonder what the GDP would have been otherwise.

    • 4 April, 2013 at 8:54 pm

      Good question. I don’t know if the data included that.

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