Paulson: $70 Billion War Budget Is A ‘Placeholder,’ Will Need ‘Unknowable Amount’ Later

By Satyam Khanna on Feb 5, 2008 at 4:58 pm

In announcing his new budget yesterday, President Bush proclaimed that it “achieves balance by 2012.” Congress, however, pointed out that the budget didn’t include billions of dollars in Iraq-related spending.

In fact, Bush’s $70 billion budget for the Iraq and Afghanistan wars account for costs only up to the first half of FY2009. In a budget hearing today, Treasury Secretary Hank Paulson confirmed that the budget drastically lowballs Iraq war-related costs:

PAULSON: What we’ve got in terms of 2009, you have $70 billion which is a placeholder. And that will be needed to be updated when Gen. Petraeus comes back and reports and so on. In terms of what we’re going to spend this year, Congress, I believe, is yet to appropriate $108 billion which is going to be needed right now.

SEN. BINGAMAN: So we need the $108 billion plus we need the $70 billion plus we need whatever Gen. Petraeus says in his report in March? And the amount that Gen. Petraeus asked for is not included in the budget?

PAULSON: It’s an unknowable amount. … That’s a placeholder and it will change based on what the requirement is.

Watch it:

[flv http://video.thinkprogress.org/2008/02/iraqpaulson2.320.240.flv]

Bush’s proposed budget will likely lead to a deficit of over $400 billion by 2009, “just shy of the record $413 billion set four years ago.” While Bush foresees a balanced budget by 2012, the unaccounted war costs will lead to a “deficit that remains in the $200 billion range in 2012,” according to Rep. John Spratt (D-SC).

Today, Secretary of Defense Robert Gates also declined to specify the war costs, claiming there are “too many variables.” “There’s a lot of games, smoke, mirrors, incomplete numbers, basically there’s not much realism” in the budget, Sen. Judd Gregg (R-NH), the Budget Committee’s top Republican, charged. “They’re playing the usual games.”