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$75 billion supplemental for US operations in Iraq, January 25, 2005

'White House Confirms $80 Billion Supplemental Request', January 25, 2005.

THE WHITE HOUSE
Office of the Press Secretary
January 26, 2005

PRESS BACKGROUND BRIEFING ON THE SUPPLEMENTAL BY SENIOR ADMINISTRATION OFFICIALS

Room 450
Eisenhower Executive Office Building
January 25, 2005

1:21 P.M. EST

SENIOR ADMINISTRATION OFFICIAL: There is a -- the President has issued a statement that is coming out now, you'll have it shortly. I'll summarize it here.

When the President decided to protect American security and remove Saddam Hussein from power, he pledged that our troops will have whatever they need to protect themselves and complete their mission successfully, and that the United States would stand with the Iraqi people in their effort to build a democratic society in the face of the enemies of democracy.

The President will -- the administration will request an FY2005 supplemental appropriation. It will be in the range of $80 billion, maybe slightly above that amount, and not including the anticipated request for additional funds for tsunami release -- relief. This supplemental budget request will help fulfill the President's pledge to our troops and to the Iraqi people and will make clear to the terrorists that our resolve is firm and that we will complete the mission in Iraq.

Most of these funds will support American troops on the ground by continuing to provide them with equipment and other supplies that they need. The request also provides for the continuing pursuit of al Qaeda and other terrorist elements in Afghanistan, while supporting the great progress that Afghanistan has made towards joining the community of free nations.

Resources are also included to accelerate efforts to train and equip Iraqi and Afghan forces so that they can soon -- can assume greater responsibility for their own security.

The supplemental also includes funding for other important priorities of American foreign policy, such as helping the Palestinian people to build a democratic state, improving the economic and humanitarian situation of the Palestinian people, and bridging differences between Israelis and Palestinians.

And my colleague has some further comments on some of the defense aspects of the supplemental.

SENIOR ADMINISTRATION OFFICIAL: Approximately $75 billion of this request -- and I should emphasize this is a request that will be delivered to the Congress next month, we're giving the broad outlines -- approximately $75 billion will be requested to fund DOD's ongoing military operations in the global war on terrorism, particularly in Iraq and Afghanistan. That's in addition to the $25 billion provided by Congress in the FY'05 Defense Appropriations Bill.

The main difference between this year's supplemental request and past years' supplemental is in the past years we've primarily addressed immediate operational and personnel-related costs. This supplemental request will take into account requirements that have been accumulated -- accumulating and emerging, I guess I would say, to -- "emerging" is a better word -- to refurbish equipment and procure new equipment. The President has pledged that our troops will have what they need to fight and win this war on terror, and that supplemental request will keep that pledge by focusing on, first of all, funding basic war costs.

When I talked about emerging requirements, I'm referring to the fact that we're using our equipment at a higher rate, what in the Pentagon we call a higher operating tempo, which is causing some of that equipment to wear out at a faster than planned rate. For example, many of our Bradley fighting vehicles are being driven over 4,000 miles a year, and under extremely difficult conditions, which comes out to about five times their planned usage. Our commitment is to keep our military units at full combat strength, and provide them with the equipment they need to do their job.

Second, we are improving Army combat capability to expand the rotation base of available combat units, within both the active Army and the reserve component. The Army is proceeding with a multi-year program to reorganize the force structure. It's called, in our lingo, "modularity," which I guess I translate, it means breaking down the Army force structure into a larger number of smaller modules. We're going from 33 deployable combat brigades in the active Army to 43 deployable, and possibly more. And I believe on the reserve component, it's about 15 deployable combat brigades going to 22, and probably higher.

That means additional equipment costs for those new brigades, and that's going to be funded initially with the supplemental request, at least the early requirement.

Ultimately, as I guess I've said already, the program will result in 10 new deployable combat brigades in the active component and additional deployable brigades in the Guard and Reserve. Beginning in FY'07, we plan to fund modularity in the base in our regular budget, and in the interim to upgrade the equipment and to reorganize units deploying to Iraq and Afghanistan. We'll be funding the first three of the additional ten brigades in the supplementals.

And the third major piece here is training and equipping Iraqi and Afghan security forces. The request we'll be making in February will fund the vital strategic goal of training and equipping military and security forces in those two countries. The elections in Afghanistan and the coming elections in Iraq are major milestones in each government's assumption of responsibility for its national security.

As you've probably noticed, Osama bin Laden has declared war on the Iraqi elections. His colleague, Mr. Zarqawi, has really declared war on Iraqi democracy now. Building the capability of Iraqis and Afghans to defend themselves and to defend their own government institutions as these develop is essential to success in both countries. Developing strong, self-sufficient security forces in Iraq and Afghanistan ensures that these countries will become more self-sufficient and less reliant on U.S. or any other international forces for the vital function of their own defense.

The balance of the funds requested are primarily to the State Department for embassy construction and operations in Iraq, for accelerating reconstruction in Afghanistan and for supporting critical partners in the war against terror, as well as some unanticipated activities, such as addressing the humanitarian crisis in Darfur.

I guess my colleague is now going to say something about the process going forward.

SENIOR ADMINISTRATION OFFICIAL: A little bit on process. We're working with affected agencies to finalize the details of their needs, and we'll plan on submitting the supplemental request to the Congress shortly after we deliver the FY 2006 budget on February 7th. As we work to finalize the details of the supplemental request, we'll also continue to work with Congress, the congressional leadership, to determine when Congress will be best positioned to take up and act on the submission. As you know -- or as most of you know, OMB will transmit the President's 2006 budget to Congress on February 7th. At that time, we'll also release deficit projections for the five year budget window. Earlier today, CBO -- the Congressional Budget Office -- announced their estimate of the deficit for fiscal year 2005 at 3.0 percent of GDP, or $368 billion in nominal terms. As CBO explained, that number did not include the outlay effects of the supplemental we're announcing today. CBO did note that with additional war costs, their estimate would likely rise to approximately 3.3 percent of GDP, or $400 billion, approximately.

In the 2006 budget that we release on February 7th, OMB will estimate that the 2005 deficit, including the outlay effects from the supplemental we're discussing today, will be 3.5 percent of GDP, or, in nominal terms, $427 billion. That's about $30 billion higher than CBO's estimates with the war costs included.

The reason -- primary reason for the difference in our estimate of the deficit versus CBO's estimate is that CBO has traditionally estimated lower outlays or lower spending rates from a certain of our mandatory government programs than has OMB. That pattern holds true again this year based on our review this morning of CBO's report. And while we're hopeful that the actual numbers for 2005 turn out to be closer to CBO's expectations than to OMB's projection, we are, again, taking the more cautious position in our estimates as we did this time last year.

We do -- we do, I think, have a small difference with CBO on the spending associated with the supplemental we're announcing today, but that's understandable, given CBO did not have that information.

As I said, the administration's deficit estimates for 2006 and beyond will be a part of the budget release on February 7th, and at that time, our projections will show that we remain on track to cut the deficit in half by 2009.

And with that, we'll open it up for any questions.

Q: Could somebody brief us how much is in the supplemental for training? You've mentioned training of Iraqi forces, but how much is that and how much -- what's it compare with?

SENIOR ADMINISTRATION OFFICIAL: We're actually not going to get into breaking out the details of the supplemental at this time. All those details will be evident when the administration submits the supplemental request, as I said, sometime after February 7th, based on our discussions with Congress. But as my colleague suggested, there will be significant funding in the supplemental request to accelerate the training and equipping of Iraqi and Afghanistan forces so they can take on responsibility for more of their own security.

Q: UESTION: I'm hearing that you will have these numbers in your '05 deficit forecast. Will you have Iraqi and Afghan spending in the '06 deficit forecast?

SENIOR ADMINISTRATION OFFICIAL: There will be -- the '06, and actually beyond '06 -- numbers, do reflect the outlay effects from this supplemental, as well as the $25 billion supplemental. The '06 budget request will not project additional anticipated supplemental requirements in 2006, just as the 2005 budget that we released last year did not. Obviously, as with last year, very difficult to project where we'll be a year from now.

Q: Without getting into specifics, of the $75 billion, we understand that most of that will be going to the Army. And will any of it, other than UABs, be for new weapons systems, or just to replace and repair those that have been damaged or deployed in the war?

SENIOR ADMINISTRATION OFFICIAL: There's going to be a certain amount, not insignificant, addressing a variety of initiatives that are underway to address particularly the problem of defeating improvised explosive devices. We have a joint task force led by the Army, but with all services participating and substantial civilian participation, to identify a wide range of initiatives that can go to defeating this particularly horrible threat. And those will be fully funded in this request.

Q: But other than UABs, any new gee-whiz weapons systems? Is most of the $75 billion going to the Army?

SENIOR ADMINISTRATION OFFICIAL: The Army -- I don't have the service years exactly, and as was just said, we don't have the final details. The bulk -- the largest single will be the Army. If you just look at last year's numbers, for example, and I don't know -- it may be helpful if I were to say, the two biggest chunks last year, one was what we call MILPERS, or the cost of people, and that includes the cost of paying mobilized reservists. Last year that was approximately $19 billion, of which approximately $13 billion went to the Army -- including, by the way, paying for roughly 30,000-person increase in U.S. Army personnel. There's a lot of discussion about, do we need a larger army, and the discussion seems to miss the fact that we have a larger army. We're also increasing the deploy-ability of that army with the initiative I described earlier. But we have about 30,000 people on active duty above authorized end strength. That's permitted in emergency circumstances. And somebody might help me with the numbers, but a six-figure number of activated Reservists and National Guardsmen. That's what's paid with that $19 billion, the Army is a $13 billion share of it.

Another breakdown is of what we call OPTEMPO, which is basically the additional costs that come from having to deploy these forces overseas and bring them home and sustain them when they're over there. Again, I think last year's numbers are helpful, because nothing -- in these two, you're not going to see dramatic changes; last year was $32 billion for OPTEMPO, of which $21 billion went to the Army.

But on the gee-whiz stuff that you're saying, most of what I would think of as gee-whiz will be inside these measures I was talking about to defeat special weapons -- although, there's a lot of other stuff that's just as important, like up-armoring vehicles and so forth, which will be in that additional cost I described for Army equipment. That's an account that's going to increase significantly, but most of that is stuff we know about.

Q: Can you just clarify, when you said the balance of funds for the State Department and other uses, you meant the $5 billion remaining, you said initially $75 billion and then there was $5 billion you didn't talk about. That was that balance of funds for the State Department, et cetera; is that correct?

SENIOR ADMINISTRATION OFFICIAL: That's right. The overall figure, as the first speaker suggested, approximately $80 billion, in the range of $80 billion, possibly slightly above, and the balance would be for the State Department costs and the other things that the second speaker talked about.

Q: Can you give us any general estimate for tsunami relief?

SENIOR ADMINISTRATION OFFICIAL: I think we're still working on estimates. The President obviously came out early on with a $350 billion [sic] figure, but we've been clear since then, and at that time, that we'll continue to revise those estimates. I think we'll see a significant request, very generous assistance from -- I'm sorry, $350 million; thank you very much.

Q: You're not used to just talking in millions, are you? (Laughter.)

Q: Can I ask you to elaborate just a little bit more on about how much is going to be spent on this new development of things to come, about IEDs and what are they talking about, in terms of doing that? What are --

SENIOR ADMINISTRATION OFFICIAL: And by the way, just so there's no mistaking, the numbers I gave you are last year's numbers; we're not giving this year's numbers yet. But in those categories that I was describing last year, you're not going to see big changes up or down. The changes are going to come in the categories I described in my opening comments. How much can I say about things we're doing?

It's -- well, order of magnitude, it's probably going to approach a billion dollars, but it's lots of small things; some of them are pretty classified. I think I better wait until a couple weeks from now when we have the actual request, because I'm a little concerned about talking on an unclassified basis about things that I'm too familiar with.

It consists, though, of everything from improved intelligence collection against people who make these things, it includes things as simple as training dog teams, it includes surveillance systems to spot the placement of IEDs, and I think -- I don't want to get beyond that. But it's -- there's no silver bullet for this particular threat. But there are a lot of individual things that people have been working on it very hard on.

Q: And just to follow up, after the elections are over, if the new government were to ask the U.S. to draw down its forces in Iraq, would we be willing to do that?

SENIOR ADMINISTRATION OFFICIAL: No, we've made clear all along, I think -- it was made particularly clear last June when Iraq assumed sovereignty that if the sovereign government asked us to leave, we will do so, but that's a very hypothetical question. I think the attitude of most Iraqis seems to be summed up by one mayor of a small town in Anbar province who said to one of our Marine generals a few months ago -- in the middle of a pretty tense period -- and Anbar, as you know, is the province that's probably least happy about our presence. This mayor said, "In my heart, I want you to leave tomorrow. In my head, I know I need you for a while longer."

I think there's a general agreement that the goal here is to use our presence and our capability and our funds to the extent necessary to get them on their own feet. That's our goal; it's their goal. And we don't want to leave before that job is finished and we don't want to stay after it's done.

Q: If I could just ask you --

SENIOR ADMINISTRATION OFFICIAL: This one's for my colleague? (Laughter.)

Q: -- kind of a big-picture question. There was an estimate today that the total cost since September 11th of military operations around the world is upwards now of $300 billion and that that's in real dollar, in constant dollar terms, about half of the cost of the Vietnam War and of World War I. What do you make of that comparison? And why, given the scale of those efforts, has this effort been so expensive so quickly?

SENIOR ADMINISTRATION OFFICIAL: I guess I'm not -- I don't know which particular estimate you're referring to. I mean, there's some pretty spectacular figures associated with the cost to this country of 9/11, and that's child's play compared to the cost the terrorists would like to inflict on us. There's no question that they are able, with relatively small expenditures, to force us to much more substantial ones. That's true on the damage side; it's also true on the military side. And, yet, the fact is, they are under enormous stress because of our success in Afghanistan; they're under enormous stress because of this war they've declared on us in Iraq. It's taxing their much more limited resources, and I think that's the way you have to think about it.

The other thing I would say, I don't know the $300 billion number, but you've given me a chance to mention, I was just in Indonesia and Sri Lanka and Thailand looking at that catastrophe and at what the United States has been able to do. And the cost of that operation is estimated at about $5 million a day, which is not a small amount of money, and it's going to be in supplemental request also, right?

But what the world sort of fails to notice is if the American taxpayer hadn't invested on the order of, I think it's $28 billion, and the ships and helicopters and aircraft that are doing that job, you couldn't -- there's nowhere else in the world you could go and hire that capability. It's a -- it's a big investment this country makes in peace and stability, and I think, though, the whole world, including very much our country, is better off for it. So -- yes?

Q: Sir?

SENIOR ADMINISTRATION OFFICIAL: This is for my colleague?

Q: No, this is for you, sir. (Laughter.)

SENIOR ADMINISTRATION OFFICIAL: The next one is going to be for my colleague. (Laughter.)

Source: US State Department, Washington File, http://usinfo.state.gov.

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