CBO Report: Iran War Costs $38 Billion, Depletes Weapons Stocks

A Congressional Budget Office (CBO) report released Tuesday estimates the war with Iran has cost the United States at least $38 billion through the end of July, projecting further inflationary pressures for American households. The nonpartisan analysis warns that munitions stockpiles have been significantly depleted, potentially crippling the Pentagon’s ability to respond to future major conflicts.

The CBO, which serves as Congress’s independent fiscal scorekeeper, noted that the Pentagon did not cooperate with the assessment or provide requested information. Consequently, the report relied heavily on public data. The cost estimate covers direct expenditures from the joint U.S.-Israel campaign against Iran, which began on Feb. 28 and ran through Aug. 1, though it excludes expenses related to U.S. bases damaged by Iranian bombardments.

Munitions constitute the bulk of the spending. The CBO projects monthly costs between $2 billion and $3 billion, with the total bill potentially rising during sustained combat. The agency also forecast that the war could add approximately 0.5 percentage points to the inflation rate early next year, driven largely by soaring energy prices and supply disruptions in the Middle East.

Strategic Inventory Shortfalls

The conflict has severely reduced U.S. inventories of missiles and anti-air defense systems. The CBO cautioned that rebuilding these stocks could take five years or longer, creating a dangerous vulnerability if a conflict emerged with an adversary possessing large arsenals of ballistic and cruise missiles.

Concerns regarding low inventory levels predate the current conflict. A congressionally mandated commission warned in 2024 that U.S. munitions could be exhausted within three to four weeks in a war with China, with critical anti-ship missiles potentially running out in days. According to the CBO, missile defense interceptors are produced at low rates, limiting overall availability.

Pricing for key interceptors varies widely: Patriot and SM-6 missiles cost roughly $4 million each, THAAD interceptors are approximately $12 million apiece, and advanced SM-3 interceptors can reach $28 million. Despite these figures, Adm. Brad Cooper, the top commander of the war, told CBS Sunday he was unconcerned about depletions, stating, “We’re armed and ready for any contingency.”

Critical Care and Base Damage Costs Excluded

The CBO’s current estimate excludes significant long-term liabilities, including veterans’ care and benefits. More than 800 U.S. troops have been wounded, with traumatic brain injuries identified as a signature injury of the conflict. Additionally, the report leaves out costs associated with damage to U.S. bases in Kuwait, Bahrain, and Jordan, which have faced Iranian bombardment.

Rep. Mark Takano, ranking Democrat on the House Veterans Affairs Committee, criticized the narrow scope of the calculation. “Counting munitions expended while leaving veterans’ care and benefits is not a real war-cost analysis,” Takano said. “It is a bill sent to veterans and taxpayers later.”

Funding Stalls in Congress

Congress has yet to enact funding to cover the war’s expenses. In July, the House passed a $95 billion budget blueprint, allocating up to $60 billion for military operations and $13 billion for intelligence. However, Senate Majority Leader John Thune indicated that legislative action is unlikely before the midterm elections, suggesting any push for funding would occur afterward.

Rep. Brendan Boyle, ranking Democrat on the House Budget Committee, condemned the delay. “Donald Trump and Republicans have spent years telling Americans that we cannot afford to help families here at home, but apparently they can find tens of billions of dollars, and potentially much more, for a reckless war that is leaving Americans to pay the price,” Boyle stated.

The financial strain has already impacted military operations, with ABC News previously reporting that the Army dramatically scaled down training this year to accommodate the surprise costs of the conflict.