Costs of Implementing Recommendations of the 2019 Missile Defense Review

In January 2017, the Administration initiated a review of the United States’ missile defense capabilities to recommend policies it could pursue and forces it could field. Two years later, in January 2019, the Administration released the Missile Defense Review (MDR), which focuses on defenses against both ballistic missiles (which are initially launched with a rocket booster and then continue to their target via nonpowered flight) and cruise missiles (which are powered throughout their flight with jet engines). The John S. McCain National Defense Authorization Act for Fiscal Year 2019 (Public Law 115-232) required the Congressional Budget Office to estimate the 10-year costs of implementing recommendations in the MDR. Those estimates are the subject of this report.

Costs of Early Initiatives

Although the report was not released until January 2019, accounts in the press suggest that the MDR was largely completed in fall 2017. In that case, high-priority changes suggested by analysis conducted for the MDR most likely guided a request for emergency appropriations in fiscal year 2018 and were also reflected in the fiscal year 2019 and fiscal year 2020 budget submissions, which were developed before the MDR’s formal release.

To estimate the cost of those changes, CBO first estimated the 10-year costs of the missile defense plans laid out in the Department of Defense’s (DoD’s) 2017 budget submission (the last budget formulated before the Administration commissioned the MDR) and the 10-year costs of the missile defense plans laid out in the 2020 budget submission (the last budget submission developed before the MDR was released). The difference between those two 10-year cost estimates, as described in this report, reflects the cost of the changes to missile defense programs that were informed by analysis conducted for the MDR and implemented before the MDR was released.

CBO estimates that the 10-year costs of DoD’s missile defense plans (as described in the 2020 budget request) would be about $176 billion (in current dollars) from 2020 through 2029. Those estimated costs are about $50 billion (or 40 percent) higher than CBO’s projection of the 10-year costs of the 2017 plan, which covered the 2017–2026 period. That difference, amounting to about $5 billion per year, constitutes CBO’s estimate of the cost of changes to missile defense forces and policies that were incorporated into the 2020 plans before the release of the MDR.

CBO’s 10-year cost estimates include costs associated with research, development, procurement, sustainment, and operation of missile defenses. They do not include the costs of assets like early-warning radars or satellites that were historically part of the nuclear forces even though they are currently used for missile defense. CBO’s estimates come with substantial uncertainty because of uncertainty in some missile defense plans and in the future quantity and capabilities of adversaries’ missile fleets, which could affect those defense plans.

Costs of Recommendations in the Missile Defense Review

The MDR also describes other recommended changes that might be pursued but that were not included in recent budget submissions. Where possible, CBO estimated the costs of those recommendations. Those estimates represent new costs—that is, if the recommendations were implemented, DoD would incur costs over and above CBO’s 10-year projections of the cost of the 2020 plan. Because the current dollar costs would depend heavily on the year in which costs were incurred, and because the schedule is uncertain for all of those efforts, the estimates are in constant 2020 dollars.

The MDR identifies two expansions of current systems that could be pursued if threat conditions warranted:

• Expand Ground-Based Midcourse Defense (GMD) at Fort Greely in Alaska to as many as 100 interceptors from the 60 currently planned. CBO estimates that adding 40 silos and interceptors would cost a total of about $5 billion.
• Establish a new GMD site in the continental United States. CBO estimates that it would cost about $4 billion to establish a new GMD site with 20 silos and interceptors and about $80 million per year to operate the site.

Additionally, the MDR directs DoD to study three potential expansions of current systems:

• Increase the number of Terminal High Altitude Area Defense (THAAD) batteries. The MDR directs DoD to determine whether the current number of THAAD batteries is sufficient. If more were required, each additional battery would cost about $800 million to procure and about $30 million per year to operate, in CBO’s estimation.
• Make all Aegis destroyers fully ballistic missile defense (BMD) capable. Provided that current shipyard capacity was adequate to install necessary upgrades, all 94 Aegis ships available in 2029 could be BMD-capable without any additional cost beyond what is already included in CBO’s projection, the agency estimates. However, new costs could be incurred if DoD purchased more missile defense interceptors than those currently planned to outfit those ships.
• Develop a plan to make the Aegis Ashore test facility at the Pacific Missile Range Facility (PMRF)operational within 30 days of a directive to do so. By CBO’s estimate, no investment costs would be required to enable operations at the test facility. However, costs could be incurred, perhaps substantial ones, to house personnel and relocate non-missile-defense test activities if the test site remained operational for an extended period.

The MDR also directs DoD to conduct several studies that could result in new systems or capabilities. For three of those studies—incorporating the F-35 sensors into missile defense, developing a new satellite constellation to track ballistic and hypersonic missile threats, and developing defenses against hypersonic missiles—there was not enough detail for CBO to fully estimate the costs of developing the systems. For the remaining two studies, CBO provides estimates based on previous technical analyses to illustrate the magnitude of potential costs of developing those systems:

• Boost-phase missile defense interceptors to be fielded on F-35 fighter aircraft. CBO reviewed several past studies of airborne interceptors (ABIs), which all concluded that the aircraft carrying ABIs would have to be close to or within the airspace of the country launching the ballistic missile for an interceptor to be able to reach the ballistic missile while its engines were still burning. Thus, a complete defense would not be possible in peacetime in most cases, particularly against large- or medium-sized countries. However, one study concluded that it might be possible to defend against launches from a relatively small adversary like North Korea during peacetime. CBO estimates that it would cost $15 billion to $20 billion to establish a defensive capability by developing the study’s two types of ABIs, produce 350 of each design, and integrate those weapons onto the F-35. That estimate does not include operation or training costs, which would depend on what those operations entailed.
• Maintaining a standing peacetime defense with the F-35, which would require 30 to 60 aircraft aloft and on station at all times, would incur substantial operating costs. Altogether, CBO estimates, developing and fielding a standing ABI defense against North Korea using F-35 aircraft and the concept described in the referenced study would cost $25 billion to $40 billion, with an additional $10 billion to $20 billion a year to operate it. Costs would be lower if DoD did not have to purchase new F-35s for the mission, and operating costs could be substantially lower if it used a less sophisticated, lower-cost aircraft for the mission.
• Space-based ballistic missile interceptors. Previous studies of space-based interceptors have found that maintaining a robust global defense requires many interceptors to be in orbit. For example, a 2011 study commissioned by the Missile Defense Agency (MDA) estimated that a constellation of 24 satellites would provide a limited defense and a constellation of 960 satellites would provide a more complete defense. Other studies, including one by CBO in 2004 and one by the National Research Council in 2012, reached similar conclusions.
• The 2004 CBO study and the 2012 National Research Council study, when considered together, indicated that fielding and operating constellations of space-based interceptors would cost roughly $50 billion to $400 billion over 20 years. However, space-related costs like launch and satellite production have decreased in recent years. In CBO’s estimation, the 20-year costs would be 20 percent to 30 percent lower if there was a modest reduction in the costs of launch and satellite production relative to the values used in the initial studies, and they would be 30 percent to 40 percent lower if there was a larger reduction in those costs. With such larger cost reductions, the range of costs estimated in those earlier studies would fall to between about $40 billion and $250 billion.