Volume 9, Issue 6, August 18, 2017
Amid an escalating exchange of threats between the United States and North Korea, President Donald Trump claimed in a tweet Aug. 9 that his “first order as President was to renovate and modernize our nuclear arsenal. It is now far stronger and more powerful than ever before.” He reiterated this claim in a press briefing Aug. 11.
Like many of the president’s utterances, these assertions don’t come close to resembling the truth. The U.S. nuclear arsenal is no more, or less, powerful than when Trump took office Jan. 20. The president did order the Pentagon to conduct a Nuclear Posture Review (NPR) to examine and provide recommendations on U.S. nuclear weapons policy and posture, but that review, which officially began in April, is still ongoing and won’t be completed until the end of this year at the earliest.
In fact, it was President Barack Obama that set in motion plans to undertake a massive and costly rebuild of the arsenal. Much of this effort is still in its infancy, and will take decades to complete. Trump inherited this program, and his first budget request, which has yet to be acted on by Congress, proposes to move full steam ahead with the Obama approach. This is not surprising, given that the administration has yet to put its own stamp on U.S. nuclear policy.
What has been lost in much of the important fact checking of Trump’s erroneous (and dangerous) nuclear saber-rattling is that while the capability of the U.S. nuclear arsenal hasn’t changed over the past seven months, the projected annual costs of the current all-of-the-above upgrade plans are rising significantly—and not because of anything Trump has done.
A Congressional Budget Office (CBO) report in February estimates that the United States will spend $400 billion on nuclear weapons from fiscal year 2017-2026. That is an increase of $52 billion, or 15 percent, from the CBO’s previous 10-year estimate of $348 billion, which was published in January 2015.
The 10-year estimate captures the beginning of the major planned ramp-up in spending to recapitalize all three legs of the existing nuclear “triad” of submarines, missiles, and bombers and their associated warheads and supporting infrastructure, but even larger bills are still to come.
How large? Analysis of budget figures recently released by the Pentagon suggest that, even though the Trump administration has yet to make any significant changes to the Obama administration’s spending plans, the total 30-year cost could approach and perhaps even exceed $1.5 trillion when including the effects of inflation. This is 50 percent more than the commonly cited estimate of roughly $1 trillion.
If the forthcoming Nuclear Posture Review by the administration does not reshape the current nuclear weapons spending plans—or worse, accelerates or expands upon them—the massive spending on nuclear weapons will pose a major threat to other high priority national security programs, to say nothing about Trump’s pledge to expand the non-nuclear military.
What makes the growing cost to sustain the nuclear mission so worrisome for military planners is that costs are scheduled to peak during the mid-2020s and overlap with large increases in projected spending on conventional weapon system modernization programs. Numerous Pentagon officials and outside experts have warned about the affordability problem posed by the current approach and that it cannot be sustained without significant and sustained increases to defense spending or cuts to other military priorities.
Trump has declared his ambition to “greatly strengthen and expand” U.S. nuclear weapons capabilities, and has criticized the 2010 New Strategic Arms Reduction Treaty (New START) with Russia, suggesting he may be looking to change nuclear policy in significant ways.
But there is no room in the budget to “expand” the scope and the cost of the upgrade plans.
Though defense spending might see a boost during the Trump administration, it's unlikely to be as high as many people think. In any event, the proposed nuclear recapitalization effort is not a one, two, or three-year effort. It will require at least 15 years of sustained increased spending. Pressure on the defense budget, and the trade-offs such pressure will require, is likely to persist.
The current approach also assumes that the United States will maintain a nuclear arsenal like the one it has now for decades to come. However, the Obama administration, with the support of the Joint Chiefs of staff, determined that the United States can reduce the size of its deployed strategic nuclear arsenal by up to one-third below the 2010 New Strategic Arms Reduction Treaty (New START) levels.
As the projected costs for programs designed to replace and upgrade the nuclear arsenal continue to rise, Congress must demand greater transparency about long-term costs, strengthen oversight over high-risk programs, and consider options to delay, curtail, or cancel programs to save taxpayer dollars while meeting deterrence requirements. Tens, if not hundreds, of billions could be saved in the coming decades by reshaping the plans and funding a smaller number of projects, while still leaving the United States with a highly credible nuclear deterrent.
Counting the Nuclear Dollars
My estimate of the 30-year cost of U.S. nuclear forces is based on tabulating Defense Department and Energy Department estimates in the following three categories: the cost of operating and sustain the current triad of U.S. nuclear delivery platforms and supporting command, control and communications systems; the cost to recapitalize the triad; and the cost of the semiautonomous National Nuclear Security Administration’s (NNSA) nuclear weapons activities.
Based on the below analysis I estimate the total cost of nuclear forces from fiscal 2018 to 2047 at between $1.25 trillion and $1.46 trillion in then-year dollars, meaning it includes price increases due to inflation over the 30-year period of the estimate.
Operating and Sustaining the Current Triad
In testimony to the House Armed Services Committee May 25, Robert Soofer, Deputy Assistant Secretary of Defense for Nuclear and Missile Defense, stated that the cost to sustain and operate the existing triad of delivery systems and command and control systems is $12-$14 billion in fiscal 2018 dollars. In its fiscal 2018 budget request the administration proposed to spend $14 billion on the current force.
These maintenance costs would be necessary even if the United States were to forgo its plans to recapitalize the arsenal.
Using $12-$14 billion as the baseline, I calculated a low and high estimate over 30-years that takes into account the impact of inflation over time. To do so I assumed an annual increase of 2.1 percent from fiscal 2018 through fiscal 2022, which is consistent with the anticipated growth rate of the overall defense budget due to inflation over the next five years as projected by the White House Office of Management and Budget. For the years beyond fiscal 2022, I assumed an annual inflation rate of 2.1 percent plus a real growth rate of 1.5 percent above inflation. The additional 1.5 percent is consistent with the real growth rate for Defense Department operation and support activities (which includes operation and maintenance and military personnel) assumed by CBO in its analysis of long-term defense costs.
Based on these assumptions I estimate a low range cost of $596 billion and a high range cost of $695 billion.
There are a number of assumption built into this projection that if altered could push the cost up or down.
First, force sustainment costs increased from $12 billion in fiscal 2017 to $14 billion in fiscal 2018. The cause of this growth is unclear, but the increase suggests that the $12 billion figure that is the basis of my low-range estimate might be unrealistically low.
Second, a real growth rate of 1.5 percent might be too conservative. Sustainment costs could increase above this rate, particularly starting in the late 2020s when the Pentagon will need to pay the cost of maintaining both legacy delivery systems and their replacements (which will begin entering service during this period). Older systems cost more to maintain as they age and newer systems typically cost more to operate when they enter service as operators adjust due to new technology.
Third, the price to maintain the current triad includes more than operation and support costs: it also includes acquisition (research and development and procurement) and infrastructure costs. The price of these activities is likely to grow at different rates.
Fourth, the Pentagon’s estimate of sustainment appears to include the full cost of operating the B-52H and B-2A bombers, which have both nuclear and conventional roles. Attributing a smaller percentage of the cost of these bombers (and later the B-21) to the nuclear mission would reduce the price of my 30-year estimate. It remains to be seen how many of the 100 B-21s the Air Force plans to buy will be certified for the nuclear mission. The retirement dates of the B-52H and B-24 bombers and how the cost to operate the B-21 will compare to the existing bombers are also unclear.
Fifth, it is not clear how the Pentagon calculates the cost of command, control, and communications systems, most of which are used by both nuclear and conventional forces. The Pentagon says that it uses an “objective weighting” to determine the portion of each command and control element to the nuclear mission. However, according to the Government Accountability Office, the department’s methodology “is not fully transparent, because it lacks a discussion of the assumptions and potential limitations of the methodology.”
The department is planning to spend $40.5 billion on nuclear command and control between fiscal 2017 and fiscal 2026.
Recapitalizing the Triad
In his May 25 testimony, Soofer stated that the Defense Department is projecting to spend $230-$290 billion to recapitalize U.S. nuclear delivery and command, control, and communications systems between fiscal 2018 and 2040, in constant fiscal 2018 dollars. The estimate includes the total cost of strategic delivery systems that have a nuclear-only mission, and a portion of the cost of the B-21 bomber (which will have both conventional and nuclear roles) that according to the department is consistent with the historical cost of delivering nuclear capability to a strategic bomber. The total also includes the cost of modernizing nuclear command, control, and communications systems and an estimate to replace the Trident II (D5) submarine-launched ballistic missile (SLBM), though a program of record for this system does not yet exist.
The Pentagon told me in July that this estimate does not include the costs to operate and sustain the recapitalized systems nor does it include any funds in support of NNSA’s warhead life extension programs and other stockpile activities.
The Pentagon also said that when the effects of inflation are included, the $230-$290 billion estimate is equal to $280-$350 billion in then-year dollars. I was told that the range reflects “uncertainty in long-term cost projections” and that the projections will be refined in the future. Some of the department’s upgrade programs, notably the replacement for the Minuteman III intercontinental ballistic missile (ICBM) system—also known as the ground based strategic deterrent, or GBSD—are still early in the research and development phase. Most of the programs have yet to enter production.
The cost range projected by the department for recapitalizing the arsenal could be understated for several reasons.
First, the projection covers a period of 23 years. The 30-year cost is likely to be higher given that some upgrade efforts will continue beyond fiscal 2040, most notably the replacement program for the Trident II (D5).
Second, the Pentagon has yet to establish replacement programs of record for the Trident II (D5) and elements of the command, control, and communications system. While the Pentagon recapitalization estimate includes a placeholder for the D5, the value of this placeholder and the assumptions behind it are unknown.
Third, the department’s recapitalization estimate does appear to account for the possibility of cost increases above its current projections. However, it is not clear what accounts for the large gap between the low and high range estimate and thus hard to determine whether the high estimate realistically captures the growth potential.
There is a significant amount of cost uncertainty associated with some of the recapitalization programs of record. For example, the Pentagon’s independent cost assessment and program evaluation office last year estimated the cost of the GBSD program at between $85 billion to over $140 billion in then-year dollars.
Finally, the overall upgrade estimate only includes a small portion of the cost to acquire the B-21. I have been told by multiple sources that the amount the Pentagon attributes to the nuclear mission could be as low as 5 percent of the total cost. If the total acquisition cost of the program were to be counted, this could add as much as $100 billion to the inflation adjusted recapitalization projection.
Sustaining and Upgrading Nuclear Warheads
The National Nuclear Security Administration (NNSA) is responsible for sustaining and upgrading U.S. nuclear warheads, science and engineering programs to maintain the arsenal without nuclear explosive testing, and maintaining and replacing aging infrastructure.
Since 2014 the agency has published an annual Stockpile Stewardship and Management Plan (SSMP), which includes a 25-year estimate (in then-year dollars) of the cost off NNSA’s nuclear weapons program.
The most recent version of the plan was published last year and covers fiscal 2017-2041 (the fiscal 2018 version of the SSMP has yet to be released). Given uncertainties about longer-term warhead life extension and infrastructure costs, the SSMP includes a low and high range estimate.
In order to calculate a 30-year estimate starting in fiscal 2018, I subtracted fiscal 2017 from last year’s plan and inflated the fiscal 2041 low and high range estimates at a rate of 2.25 percent through fiscal 2047. The inflation rate of 2.25 percent is the same rate used by NNSA in the fiscal 2017 SSMP to estimate costs beyond fiscal 2026.
Based on these assumptions I project a low range cost of $369 billion and a high range cost of $417 billion.
The projection for NNSA is likely too low, and perhaps significantly so. First, it does not include any funds from other NNSA accounts, such as naval reactors and the office of the administrator that directly contribute to sustaining and upgrading nuclear warheads and their supporting infrastructure.
Second, the cost projections beyond fiscal 2041 do not include any real growth beyond inflation, even though NNSA will still be in the throes of conducting several large-scale warhead life extension programs. The agency is projecting to spend between $73 and $95 billion to upgrade two air-delivered warheads and develop three new interoperable warheads for use on both ICBMs and SLBMs.
Third, NNSA has a troubled history of failing to control the costs of major programs, particularly construction projects. While there is some cost growth built into the high-range estimate, additional growth is probably more likely than not. Moreover, plans for several NNSA priorities, such as sustaining plutonium capabilities and reducing the number of aging facilities that require maintenance, have yet to be fully developed and thus do not have accurate cost estimates.
Finally, the long-term cost projections in the yet to be released fiscal 2018 version of the SSMP could be higher than the fiscal 2017 plan.
What’s Different Here
There are a number of key differences between the above analysis and other independent projections of the long-term cost of nuclear forces.
In its biennial, 10-year estimate of nuclear weapons costs, CBO attributes 25 percent of the cost to operate the B-52H to the nuclear mission, 100 percent of the B-2A cost, and 25 percent of the B-21 acquisition cost. CBO also includes a higher estimate of the cost of command, control, and communications systems than the Pentagon. Furthermore, CBO includes an estimate of additional costs based on historical cost growth.
CBO is planning to release to 30-year estimate of the cost of nuclear forces, according to news reports.
In 2014 the Middlebury Institute of International Studies at Monterey published a report that projected the 30-year costs of nuclear forces between fiscal 2014 and fiscal 2043 at between $872 billion and $1.082 trillion in constant fiscal 2014 dollars (though the estimate for NNSA’s weapons program appears to be in then-year dollars). The report covers an earlier time-period than the above analysis and did not assume any real growth in the cost to sustain and operate the triad. The report also does not appear to have included any projected cost to upgrade command, control, and communications systems.
In 2015 the Center for Strategic and Budgetary Assessments (CSBA) published a report that projected the 25-year costs of nuclear forces between fiscal 2015 and fiscal 2039 at $816 billion in then-year dollars. The CSBA estimate covers a shorter and earlier time-period than the above analysis. In addition, the estimate only included 25 percent of the cost to operate the B-2A bomber and 10 percent of the cost to acquire and 25 percent of the cost to operate the B-21 bomber. The estimate also attributed a much smaller percentage of the costs of command, control, and communications systems to the nuclear mission.—KINGSTON REIF, director for disarmament policy