Search Engine with PJ Vogt

Episode: The Cost of War

April 17, 2026

Episode Overview

In "The Cost of War," host PJ Vogt digs into a question perplexing even the most attentive citizens: What exactly is the U.S. war with Iran costing, and how do we account for it? With most Americans unclear on the reasons for the conflict, Vogt sidesteps moral and political debates to focus on its financial realities. Featuring public finance expert Professor Linda Bilmes of Harvard Kennedy School, the episode dissects the true (and often intentionally hidden) price tags of modern American wars—past and present—including upfront, medium-term, and generational costs.

Key Discussion Points & Insights

1. Confusion Over War’s Purpose and Public Awareness

• PJ Vogt admits confusion over the rationale for the war with Iran:

  “I genuinely, if you were to ask me, PJ, explain why the United States is currently at war with Iran, I would have to answer, I don’t know.” (02:01)

• Cites that two-thirds of Americans don’t understand the reason for the war (02:47).
• Raises the possibility that there may be no sensible underlying reason, but whether or not there's a rationale, Americans should be able to grasp the costs (03:25).

2. Introducing the Costs – Why Billions and Trillions Don’t Feel Real

• Prof. Bilmes explains why the public struggles to comprehend war costs:

  “Partly because the words millions, billions, and trillions rhyme in English, we don’t even really fully grasp the scale of the spending on wars. … A billion seconds ago is like the 90s...and trillions is woolly mammoth era.” (06:01)

• There is a psychological disconnect between massive war expenditures and local spending debates, like funding after-school sports (05:52).

3. How War Costs Are Calculated (or Not)

• War spending is intentionally obfuscated:

  “The government spends war money less honestly than it spends most of its budget. ..." (07:06)

• Explains the use of "emergency appropriations" during Iraq and Afghanistan to keep war costs out of the regular budget, minimizing visible deficits and undermining Congressional oversight (10:35, 11:17).
• Pentagon accounting is notoriously poor—fails its audits every year, can’t account for about 50% of assets (13:07, 13:24).
  • Quote: “If the Pentagon were a private sector organization, there would be extreme penalties for failing to be able to account for spending...” (14:25)

4. The Shift from “Pay As You Go” to “Buy Now, Pay Much Later”

• Historically, the U.S. paid for wars with tax hikes and budget cuts, requiring public debate and shared sacrifice:

  “President Wilson in World War I raised corporate taxes from 1% to 12%...Truman raised top marginal tax rates to 92%...Johnson imposed a tax surcharge…” (17:14)

• After 9/11, the U.S. not only began the War on Terror without raising taxes, it cut them—even as spending soared (18:35).
  • “Now we just add it to the deficit.” (18:37)
• Reasons behind the shift:
  • Dysfunctional budgeting in Congress,
  • Historically low interest rates (made borrowing easy/cheap),
  • Defense Department advantages in accessing flexible, off-budget spending (19:03–22:06).

5. Iraq and Afghanistan: The True Cost

• Bilmes’s and Brown University’s upper estimates for the total long-term bill:

  “...between $5 and $6 trillion, Iraq and Afghanistan wars together. Brown University estimated it at $8 trillion.” (22:10)

• PJ Vogt: “That war...cost us a price that would have paid for a full century of free education at all public American universities.” (23:03)

6. Applying the Framework: The New War With Iran

Upfront Costs

• Within the first six days, the Pentagon claimed $11.3 billion spent on Operation Epic Fury (27:46).
  • Replacement costs are even higher (Tomahawks: $2m in inventory, $3.5m to restock).
  • The reported numbers undercount full costs: replace/repair, extended deployments, carrier strike group expenses, etc. (29:22).
• The largest slices of upfront cost:
  • War machine & munitions, not troop pay (30:00).
  • Loss of high-value military assets (e.g., $700 million surveillance plane destroyed) (30:46).

Hidden & Long-term Costs

• Exposure of 50,000 troops to toxins implies generational costs (lifelong disability, healthcare) (31:30).
  • “...we owe $7.3 trillion in just disability benefits, not even counting medical care to living veterans.” (31:59)
  • No mechanism to track these future liabilities in detail (33:20).
  • “We know that the floor is $7.3 trillion, which is just the benefits we've already promised but not yet paid." (33:53)

Medium-Term Costs

• Infrastructure repairs: U.S. bases, embassies, and potentially allied facilities (Qatar’s gas facility: $26 billion to repair) (36:51).
• Economic ripple effects from strategies like Iran’s closure of the Strait of Hormuz, government-backed reinsurance for shippers ($20 billion)—more hidden government costs. (35:54, 36:02)

Ongoing/Total Bill

• A $200 billion supplemental request to Congress (37:19).

• Increased 'base' defense budget (“from $1 trillion to $1.5 trillion”) (38:57).

  "And once you get that increase in the base, that goes on and on." (40:06)

• The high cost of U.S. interception technology vs. Iran’s cheap drone tactics:

  • “Iranians produce very cheap drones for $20,000, maybe $30,000, and we use $2 million, $3 million interceptors to down these drones. This is highly asymmetric...” (40:22)

7. The Political Feedback Loop

• Presidents (currently Trump, previously Biden) have engineered war spending to keep the public from feeling the financial impact—e.g., using reserves to reduce gas prices. (47:57)

• Ironically, when the Strait closure finally raised gas prices, Trump’s popularity sank, and MAGA media turned against him (44:25).

• Wars don’t end for moral reasons, Bilmes concludes—historically it’s when the “blood or treasure” runs out (46:18).

  “If we pay for every war on credit card… one of the most basic deterrents to perpetual war is missing.” (46:18)

Notable Quotes & Memorable Moments

• On scale and perception:

  • Linda Bilmes: “A billion seconds ago is like, you know, in the 90s when The Lion King came out, and trillions is woolly mammoth era.” (06:01)

• On Pentagon accountability:

  • Bilmes: “They cannot account for at least 50% of their assets around the world.” (13:24)

• On Congressional oversight:

  • Bilmes: “The money used to have to come from somewhere… Congress had to get involved because Congress has to approve tax increases. So this forced the fiscal committees…to approve these taxes. … Congress spent a lot more time grappling with how are we going to pay for these wars?” (17:12)

• On borrowing for wars:

  • Bilmes: “If you borrow, that leads to war and that leads to prolonging war because it makes the costs invisible.” (46:18)

• On opportunity cost:

  • PJ Vogt: “That war… cost a price that would have paid for a full century of free education at all public American universities.” (23:03)
  • Vogt: "For $1 trillion, the US government could fund free school lunch for every K through 12 student in America for over 40 years. ... Or buy every sports team in the NFL, NBA, MLB, and NHL, and have money left over..." (49:35)

• On the new era of warfare:

  • Bilmes: “We have expensive weapons that are really, really good at precision and are wildly expensive to produce. And we're sending them for every one of these very cheap weapons … We've reduced by half our inventory.” (41:58)

Important Timestamps

• 02:01 – PJ Vogt admits confusion about the rationale for war.
• 05:40 – Professor Linda Bilmes explains her background and obsession with war costs.
• 13:07–13:24 – Pentagon’s historic failure to account for assets.
• 17:14–18:35 – Discussion of historical and current war financing methods.
• 22:10 – True estimate for Iraq and Afghanistan Wars' cost ($5–8 trillion).
• 27:46–28:19 – $11.3B reported for first six days of Iran war, real cost higher.
• 31:30–33:53 – Long-term costs of veterans’ health/disability and lack of transparency.
• 36:02 – $20B federal reinsurance for Gulf shippers after Strait closure.
• 37:19–38:57 – $200B emergency supplemental and defense budget escalation.
• 44:04–45:06 – Domestic backlash and unpopular war, leading to fragile ceasefire.
• 46:18 – “Wars ended when countries ran out of blood or treasure.”
• 47:57–49:35 – How governments shield the public from war’s price—and what was done in the past.

Concluding Thoughts

The show leaves listeners with a stark perspective: Modern American wars have become financially disconnected from public awareness and accountability, largely because their costs are hidden, deferred, or disguised. As a result, both moral and pragmatic brakes on war are weakened. Unless the true fiscal burden is made visible and felt, history suggests the U.S. risks ever-more frequent and costly conflicts.

Guest featured:

• Professor Linda Bilmes (Daniel Patrick Moynihan Senior Lecturer Chair in Public Policy & Public Finance, Harvard Kennedy School)

Host: PJ Vogt

For further reading:

• Bilmes’s forthcoming book: The Ghost Budget