As Trump Orders New Attacks, Cost of Iran War Pegged at $103 Billion

At the NATO summit, Trump promised new attacks against Iran.
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By Yuval Rosenberg and Michael Rainey

U.S. military forces launched a new round of strikes against Iran today, hours after President Trump declared that the ceasefire in the war is "over." Trump told reporters he's not sure he wants to make a deal with Tehran. He called Iranian leaders "liars" and "scum." In a social media post, U.S. Central Command said, "The United States is holding Iran accountable for recent unjustified aggression against commercial shipping and civilian crews freely navigating a vital international waterway." Here's what you should know tonight.

As Trump Orders New Attacks, Cost of Iran War Pegged at $103 Billion

President Trump said Wednesday that the ceasefire with Iran is "over" and promised a new round of attacks in retaliation for Iranian attacks on three oil tankers in the Strait of Hormuz this week. Hours later, the United States bombed Iran for the second night in a row.

"I think it's over," Trump told reporters gathered at the NATO summit in Ankara, Turkey. "I don't want to deal with them anymore. They're scum." Trump added that he thinks the Iranians are "led by sick people" who are "vicious, violent people" and "cuckoo."

Trump said he planned to continue bombings that began Tuesday night, and perhaps seize Kharg Island, a key transit point for Iranian oil, as well as reinstitute an embargo on Iranian oil exports. At the same time, Trump said the recent U.S. bombings do not mean that "long-term" military action would resume - leaving most observers wondering what the status of the war actually is.

Global economic cost: The bombing and Trump's apparent rejection of the ceasefire sent oil prices sharply higher Wednesday and raised new concerns about the fiscal and economic cost of Trump's war, which began in February when U.S. and Israeli forces attacked Iran and killed much of its leadership.

The International Monetary Fund warned Wednesday that the global economy is poised to slow significantly, due largely to the destruction of energy infrastructure in the Persian Gulf. In April, the IMF reduced its estimate of the global 2026 growth rate from 3.5% to 3.1% due to the war. Now it is further reducing that estimate to 3.0%.

The IMF said the global economy had weathered the initial weeks of war better than expected, although inflation had taken a toll, with energy prices 25% higher than before the war and expected to remain elevated. Discussing the report, which was written before the recent flare-up of hostilities, an IMF analyst noted that there is considerable uncertainty. "A renewed escalation in the conflict could reignite commodity price volatility, tighten financial conditions, strain policy buffers, and worsen food insecurity in low-income countries," Petya Koeva Brooks, deputy director of the IMF's research department, told reporters, per Reuters.

Rising fiscal costs: In May, Pentagon officials told Congress that the Iran war had cost roughly $29 billion up to that point, but some experts believe that the cost was likely considerably higher and has only risen in the weeks since. Last month, the Pentagon requested $67 billion in supplemental funding for the war, indicating that costs have indeed been considerably higher, even though additional details have been scarce.

Stephen Semler, a contributor to the Costs of War project at Brown University and a co-founder of the Security Policy Reform Institute, a think tank that works to have U.S. foreign policy better serve working-class interests, released an analysis Wednesday that estimates that the war has cost $103.3 billion through the first 120 days, up until late June.

Semler based his estimate on costs directly associated with the war, "including operations, personnel, and matériel."

The estimate - which Semler notes is "larger than all but three countries' military budgets" - breaks down as follows:

  • Military operations: $28.5 billion;
  • Weapons used: $46.7 billion;
  • Destroyed or damaged assets: $20.3 billion;
  • Costs to non-military agencies: $4.8 billion;
  • Subsidies for Israel: $2.9 billion.

Semler said his analysis leaves out indirect costs of the war, which will include interest on the increased debt incurred, since Congress does not seem interested in offsetting the cost through tax increases or spending cuts. "War is never paid for when you fight it," House Appropriations Committee Chair Tom Cole said in March. "We didn't pay for World War II or Korea or World War I ... so I don't think [the cost of the Iran war] should be offset." (Semler notes that Cole is wrong as a matter of history, since Congress raised taxes sharply during the major wars he cites.)

Taking the direct and indirect costs into account, estimates of the overall cost of the Iran war soar into the hundreds of billions. Linda Bilmes, an expert on public finance at Harvard University, said in April that she expects the final cost to top $1 trillion.

"Wars always cost more than expected," Bilmes said in an interview with the Harvard Kennedy School at the time. "Throughout history, those who get into wars tend to be optimistic about the cost and about the length of time it will take. For example, Russia thought it could take control of Ukraine in a few weeks. President George W. Bush fired his economic advisor, Larry Lindsey, for predicting that the Iraq War might cost $200 billion (it ended up costing $5 trillion). We see the same pattern with Iran."

Click here for the methodology behind Semler's analysis.

Obamacare Premiums Set for a Second Straight Double-Digit Jump

Health insurance premiums for Affordable Care Act plans are likely to jump again in 2027, according to a new analysis by KFF, a health policy research organization.

Insurers in the ACA marketplace have proposed a median premium hike of 14% for next year, according to the KFF analysis, which looked at preliminary filings by insurers across 16 states and the District of Columbia. Of the 77 insurers that have submitted filings ahead of a July 15 deadline, 20 are seeking premium increases of more than 20%, KFF says.

"This is the second consecutive year of double-digit premium hikes," KFF's analysts write. They add that last year's median proposed rate change was 18%, and the median finalized rate change was 20%. The proposed 14% increase for 2027 would be the second-highest since 2018. "If these early indications of median premium increases for 2027 hold, typical premiums for insurers participating in the ACA Marketplaces will have jumped by more than one-third over a two-year period," the new report says.

(The new analysis was published by the Peterson-KFF Health System Tracker, a partnership of the Peterson Center on Healthcare and KFF. The Fiscal Times is an editorially independent publication separately funded by the Peterson family.)

The insurers' filings reportedly cite the rising cost of hospitalizations, doctor visits and prescription drugs as well as broader inflation and the expiration of enhanced ACA tax credits at the end of last year. Some insurers also cited regulatory changes as a factor driving premiums higher.

"The underlying cost of medical care and prescription drugs has risen by 10% for 2027-greater than the 8% average growth seen over the last few years," KFF said in a news release.

The expiration of the more generous ACA subsidies already led to a 58% increase in average out-of-pocket premium costs for this year and deductibles of about $1,000 more per person, according to KFF. The increased cost led many healthier enrollees to drop their ACA plans, leaving a smaller pool of somewhat sicker enrollees, who are more expensive to cover, in the marketplace. Enrollment in ACA plans fell to about 19 million people as of February 2026, down from a high above 22 million people in 2025.

Insurers estimate that the changing pool of enrollees drove premiums up by about 4 percentage points this year and will do so again for 2027, according to KFF. The higher premiums also drive up subsidy spending for lower-income enrollees.

The bottom line: Insurance rates for 2027 will be finalized later this summer, but the healthcare affordability squeeze looks likely to get significantly worse in 2027.

Charts of the Day: The Federal Money Flowing to Trump-Linked Companies

President Trump's nearly 1,000-page financial disclosure last week revealed more than $2 billion in revenue for 2025, Steve Rattner, an investor and former "car czar" under President Obama, today highlighted another way the Trump family is cashing in on the presidency.

"The Trumps aren't just using their family name to make money," Rattner wrote in a post on X. "Their companies have received almost a billion $$ in federal contracts - a shocking and unprecedented display of corruption."

The two Rattner charts below show how Trump's wealth has grown and how ventures tied to the Trump family have benefited from hundreds of millions of dollars in federal funds.

Charts of the Day: The Federal Money Flowing to Trump-Linked Companies

Fiscal News Roundup

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