NEW: Trump’s War in Iran Cost DoD Nearly $40 Billion and Drove Nearly Half of Inflation, According to CBO Report

Text of Report (PDF) Washington, D.C. – Today, in response to an inquiry led by Senators Elizabeth Warren (D-Mass.), Jeff Merkley (D-Ore.), Ranking Member of the Senate Budget Committee, along with Minority Leader Chuck Schumer (D-N.Y.), the nonpartisan Congressional Budget Office (CBO) released new data on the cost of President Trump’s war in Iran. The major findings include: Trump’s war with Iran cost the Department of Defense (DoD) nearly $40 billion as of Aug 1 – without including the cost of damage to “hundreds of buildings and structures at U.S. bases” in the region. The U.S. military will not be able to replace munitions destroyed in the war for at least five years. CBO estimates that more than 40% of inflation from the second quarter of 2026 is a consequence of Trump’s war. CBO estimates that inflation will be 0.5 percentage points higher in the first quarter of 2027 than it would have been without the war—ultimately driving interest rates higher and increasing borrowing costs for American families and businesses. CBO estimates that it will take “at least five years—even if production was increased” to replace the munitions destroyed. CBO’s estimate did not include $113 million in costs incurred by State , including $79.2 million “to respond to contingencies stemming from the Iran conflict.” Additionally, given that the macroeconomic projections were based on data through August 17, 2026, and global oil prices and futures have increased since then, it’s likely that these estimates do not capture the full extent of the war’s continued impact on inflation. “Trump’s illegal war with Iran is a one-two punch that’s burning a hole in Americans’ pockets and burning a hole in our munitions supply, hurting our military readiness,” said Senator Warren . “This war is a betrayal of the American people, and it needs to end.” “After months of the Trump Administration hiding the true cost of his illegal war of choice with Iran, the American people are finally getting independent and objective answers on the cost of the conflict,” said Senator Merkley . “As prices for everything from groceries to gas skyrocket, we must end this abuse of taxpayer dollars and double down on ending Trump’s illegal war. It has cost America dearly.” Senator Warren has fought to hold the Trump administration accountable for waging an illegal war in Iran: On July 30, 2026, Senator Warren (D-Mass.) and Representative Pat Ryan (D-N.Y.), a member of the House Armed Services Committee, led 11 members of Congress in opening an investigation into reports that the DoD failed to provide adequate medical care to service members injured in a March drone strike on a U.S. military post at Port Shuaiba in Kuwait. On April 22, 2026, Senator Warren (D-Mass.) pressed General Randall Reed, Commander of the U.S. Transportation Command (TRANSCOM), on the Trump administration’s failures in evacuating Americans from the Middle East at the start of President Trump’s illegal war in Iran. On April 20, 2026, Senators Warren (D-Mass.) and Van Hollen (D-Md.) led nine senators in opening a new investigation into Secretary of Defense Pete Hegseth’s role in weakening civilian harm prevention programs and the catastrophic civilian impacts of President Trump’s war in Iran. On April 7, 2026, Senator Warren (D-Mass.) released a new video condemning President Trump’s threat to wipe out the “whole civilization” of Iran and called for Majority Leader Thune to bring the Senate back into session immediately to vote to stop Trump’s war. On March 20, 2026, Senator Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, wrote to Secretary of Treasury Scott Bessent and other members of the Trump administration, raising concerns about the financial costs for American families from President Trump’s illegal and reckless war with Iran. On March 20, 2026, at a hearing of the Senate Armed Services Committee, Senator Warren (D-Mass.) sounded the alarm about the Trump administration’s sidelining of the military’s Judge Advocate General Corps, who are responsible for providing independent legal advice to commanders. Senator Warren pressed the commanders of United States Northern Command and United States Southern Command about the impact the sidelining of JAGs has on civilian harm as the war against Iran continues. On March 11, 2026, Senators Warren (D-Mass.), Van Hollen (D-Md.), Kaine (D-Va.), Schatz (D-Hawaii), Leader Chuck Schumer (D-N.Y.), and 41 colleagues pressed Defense Secretary Pete Hegseth for a full investigation into the airstrikes on a school in Minab, Iran, and other civilian casualties in the Trump administration’s war on Iran. On March 12, 2026, at a hearing of the Senate Finance Subcommittee on Fiscal Responsibility and Economic Growth, Senator Elizabeth Warren (D-Mass.) questioned the Director of the Congressional Budget Office on the financial implications of the Iran war and highlighted that the enormous financial cost could instead be used to lower the cost of health care. On March 5, 2026, Senator Warren (D-Mass.) led the entire Massachusetts delegation in pressing Secretary of State Marco Rubio to explain the Trump administration’s “complete failure” to evacuate U.S. citizens — including Massachusetts residents — from the Middle East following the administration’s starting a reckless war in Iran. On March 3, 2026, Senator Warren (D-Mass.) took to the floor of the U.S. Senate to call on Congress to end President Donald Trump’s reckless war in Iran and demand accountability. ###