Americans could owe $6.5 trillion for wars in Afghanistan and Iraq — and that's just the interest

Although the U.S. is trying to turn the page on two decades of war in the Middle East, American taxpayers can expect to pay for those conflicts for decades to come. 

The ultimate cost of the nation's engagements in Afghanistan and Iraq, on top of the incalculable personal toll on combatants and civilians, reflects a shift in how war has typically been financed. From the American Civil War through the Korean War, the U.S. government has mostly paid for its conflicts through taxes and war bonds. But in the post-September 11 era, U.S. military spending has been financed almost entirely through debt.

Since the September 11 attacks, the U.S. government has spent $2.2 trillion to finance the wars in Afghanistan and Iraq, according to figures from Brown University's Costs of War Project. Yet that sum — which amounts to roughly 10% of the the country's total gross domestic product — only reflects upfront costs. 

Including the cost of interest on those wars will add an additional $2.1 trillion by 2030. And through 2050, the interest alone is forecast to top $6.5 trillion — even if war spending had theoretically stopped in 2019, according to research published last year from Heidi Peltier, director of the "20 Years of War" Project at Boston University's Pardee Center for the Study of the Longer-Range Future.

Such borrowing leads to larger total costs because interest must be paid as long as the debt is owed. That pushes the "true cost of war out to future generations," Peltier told CBS MoneyWatch. 

"What that does is shield the American public from the costs currently," she said. "So, Americans don't realize that they're paying for the cost, because their taxes are not increased. And they're not buying more [war] bonds, they're not in any way feeling the [financial] effects currently."

Tax hikes in previous wars  

Previous wars were largely paid for by taxes. For example, President Harry Truman temporarily raised the top tax rate on the richest Americans to 92% to help pay for the Korean War. And President Lyndon Johnson temporarily raised the top rate to 77% to fund the Vietnam War.

At the outset of the wars in Afghanistan and Iraq under President George W. Bush, however, Congress cut taxes by roughly 8% for the wealthiest Americans. Since then, war costs haven't been included in the regular defense budget, experts have noted. 

"In every previous major war, the war budget was integrated into the regular defense budget after the initial period. This meant that Congress and the Pentagon had to make trade-offs within the defense budget," Linda Bilmes, a lecturer in public policy and finance at Harvard's Kennedy School told Congress in 2017. "By contrast, the post-9/11 wars have been funded mostly by supplemental appropriations."

That additional funding approved by Congress to pay for U.S. wars over the last two decades is exempt from spending caps and doesn't require cuts elsewhere in the budget to offset them, Bilmes noted.

Another hidden cost: military personnel. The U.S. has committed to pay the health care, disability, burial and other costs for about 4 million Afghanistan and Iraq war veterans, which are projected to amount to more than $2 trillion. Those costs will peak after 2048, according to the Associated Press.

Overall, the U.S.' net interest costs — payments the federal government sends to investors and public debt holders minus interest it collects — are rising. That includes the interest on borrowing to fund the wars in Afghanistan and Iraq. Net interest is projected to widen to 2.7% of GDP in 2031, up from 1.3% in 2024, according to a July report by the nonpartisan Congressional Budget Office.

The Associated Press contributed to this report.