National Research Council Overstated Cost Of Patriot System; Lexington Retracts Blog

On September 24 I wrote a blog on the Lexington Institute web-site expressing shock at the price-tag for sustaining the Patriot Advanced Capability 3 (PAC-3) air defense system. Patriot is a key feature of the Army’s force structure, capable of intercepting both aircraft and tactical missiles. However, the respected National Research Council had calculated in a draft report that it would cost $14.7-16.2 billion to maintain one fully equipped Patriot battalion over the next 20 years, which implied the cost of sustaining all 15 battalions in the current force for the same period would approach a quarter-trillion dollars. My blog asked why the Army would kill its planned replacement for Patriot when the cost of the existing system seemed to be astronomically high.

It now appears that the research council confused the cost of one Patriot battalion with that of the entire force, and as a result over-stated the system’s sustainment cost by 1500%. My blog was thus grossly inaccurate. We have removed the blog from the Lexington site and want to set the record straight. The Army estimates that it will cost between $14.7 billion and $16.2 billion to sustain the entire Patriot air defense force over the next 20 years, or less than a billion dollars per year. That suggests it costs about $50 million annually to operate and sustain a single Patriot battalion, which is a reasonable price-tag for such a crucial capability.

I have argued for some time that the Army should have kept its next-generation air defense system on track because of likely changes in future threats. The Army contends that upgrades to the existing PAC-3 configuration of Patriot are adequate at a time when military budgets are shrinking and other threats appear more urgent. Whatever the merits of either viewpoint may be, it seems clear that the cost of operating and sustaining the Patriot should not weigh as heavily in program decisions as I argued in my September blog. I apologize for my error. In retrospect, I shouldn’t just have been shocked by the high cost estimate in the research council’s report — I should have realized it was wrong.