The Long-Term Costs of the War in Iraq
How much will the Iraq war cost us?:
Experts Calculate Billions in Long-term Costs of War, PBS [Real Audio - Download - Streaming Video]: Congress has approved about $450 billion to date for the Iraq and Afghanistan wars, but economists also have been tabulating the long-term costs such as veterans' care. Economics correspondent Paul Solman explores the broader costs of the war.
JIM LEHRER: Now, what the war in Iraq is costing. Democrats in Congress are still trying to pass a war funding bill the president will sign. That legislation will provide money for military operations, but those funds are only part of the larger price tag. The NewsHour's economics correspondent, Paul Solman, has our report.
PAUL SOLMAN [NewsHour Economics Correspondent]: The cost of the Iraq war, it's a far cry from the original estimates.
DONALD RUMSFELD [Former U.S. Secretary of Defense]: The Office of Management and Budget estimated it would be something under $50 billion.
GEORGE STEPHANOPOULOS [Host, "This Week"]: Outside estimates say up to $300 billion.
DONALD RUMSFELD: Baloney.
PAUL SOLMAN: The $50 billion estimate turns out to be a modest fraction of what the war has actually cost thus far, the out-of-pocket, mainly military costs.
GREG SPEETER [National Priorities Project]: We're averaging, over the period of the war, about $275 million a day.
PAUL SOLMAN: Greg Speeter runs the National Priorities Project and its costofwar.com Web site, which tracks the spending per second. At this point, says Speeter, the total is close to $450 billion.
GREG SPEETER: That gives you some indication of just how expensive this war is.
PAUL SOLMAN: But, no, it really doesn't, according to those who've looked at the numbers more broadly. As economist Linda Bilmes explains...
LINDA BILMES [Harvard University]: Even if we withdrew all of our troops from Iraq tomorrow, the war would still keep costing us money for many, many years to come, because there are several long-term costs which are not included in the running costs of the war.
PAUL SOLMAN: With Nobel laureate economist and former Bill Clinton adviser Joe Stiglitz, Bilmes did a cost study that's received a lot of attention for its bottom line.
LINDA BILMES: The total cost of the war would be between $1 trillion and $2 trillion.
PAUL SOLMAN: But how do you get from $450 billion to as much as $2 trillion? Let's take the added costs one at a time.
First of all, says Professor Stiglitz, during any war...
JOSEPH STIGLITZ [Columbia University]: ... you use up equipment. Equipment gets depreciated, deteriorates, and much of that doesn't get replaced until after the war is over.
LINDA BILMES: There's also the cost of what's called resetting the military, retraining the troops and bringing the U.S. military force back up to its pre-Iraq strength.
PAUL SOLMAN: Plus, says Stiglitz...
JOSEPH STIGLITZ: One of the consequences of the war is that people are not volunteering for the Army. To recruit people into the Army, you have to pay big bonuses, so our overall recruitment cost skyrocketed.
The addition of medical costs
PAUL SOLMAN: Summing all increased military costs would add at least $125 billion to the total. An even bigger addition, though, comes from medical costs, present and, more importantly, future.
LINDA BILMES: In this war, there are eight wounds in combat for every fatality and another eight injuries and illnesses for people who are over there. So, in total, it's 16 wounded or injured soldiers for every one who is killed in Iraq. ...
PAUL SOLMAN: We've seen these costs before on the NewsHour: 23-year-old Sergeant Joseph Youn, for example, his brain hit by shrapnel two years ago, a hospital inpatient ever since...
PAUL SOLMAN: Eddie Ryan, also 23, shot in the head by friendly fire. The Veterans Administration pays $250,000 a year to care for him at his rural New York home for as long as he lives.
When Bilmes tried to estimate the cost of all long-term medical care due to Iraq casualties like these, she got a range of $200 billion to $400 billion, depending on how long the war lasts, to which she and Stiglitz also add the cost of long-term disability for soldiers like Brad Heun of Tennessee, a former auto mechanic whose vertebrae were crushed in Iraq.
BRAD HEUN [Injured Iraq Veteran]: There's absolutely no way I could stand on my feet for that length of time or bend over the hood of a car.
PAUL SOLMAN: After the first Gulf War, which lasted about a month, nearly half of the 200,000 Americans who fought filed disability claims. Meanwhile, this time, close to a million Americans have been deployed in Iraq thus far, half of them more than once and for long periods of time.
LINDA BILMES: Just this year, there have been more than 50,000 claims by veterans, disability claims, which involved eight or more separate conditions.
PAUL SOLMAN: Rex Collier happened to be one of our audio men for this story. His son, Bradley, a Marine, was wounded in Ramadi.
REX COLLIER [Father of Injured Marine]: He was hit by a sniper from a rooftop that popped up and shot him with an AK-47 down into his shoulder, through his Kevlar. It went into his lung. And then an RPG hit a truck behind him about the same time and took shrapnel in the other arm.
PAUL SOLMAN: He's been in constant pain ever since, suffers from PTSD, post-traumatic stress disorder. At a restaurant, says Collier, his son...
REX COLLIER: ... would not have his back exposed, was always on the lookout, constantly looking up and finding himself glancing up, looking around all the time, as if he were on patrol for somebody to possibly be hidden away to shoot him.
The issue of disability payments
PAUL SOLMAN: Bradley Collier's disability pay: some $15,000 a year. Brad Heun gets $30,000 for a family of five. But multiply even these modest amounts by the number of soldiers maimed, times their life expectancy, and Bilmes and Stiglitz get a long-term disability number between $70 billion and $150 billion, in which case the total cost of the war would rise to a range of about $850 billion to $1.2 trillion.
But even $1.2 trillion doesn't capture the real cost to Americans, Joe Stiglitz argues, the social cost.
JOSEPH STIGLITZ: If somebody gets disabled, the U.S. government pays him disability for the rest of his life. But these disability payments are typically just a fraction of what this individual would have earned. It certainly doesn't compensate him.
If you asked him, "Would you rather have an arm or get that disability payment?" there would be no question. He'd say, "Give me my arm back." So the disability payments vastly underestimate the cost to the individual, to his family, to our society.
PAUL SOLMAN: How much money would you spend, borrow, steal, maybe, to be able to buy your son out of that whole experience so that your son would be the guy he was before he went to Ramadi?
REX COLLIER: There really isn't a price you can put on it. Whatever was asked to avoid that, I would have given that much and found a way to find it, to come up with it.
PAUL SOLMAN: And speaking of priceless, what about life itself?
REX COLLIER: There's no number. If my child was missing in combat, I would do absolutely anything.
PAUL SOLMAN: Anything at all, says insurance agent Bruce McElhaney, who does volunteer work for Iraq veterans and families of the deceased. One way to reckon the value of a life lost: what the family actually gets in life insurance -- at least $100,000 -- plus, if the fallen soldier bought the maximum insurance policy...
BRUCE MCELHANEY [Veterans Volunteer]: ... $400,000.
BRUCE MCELHANEY: There are also some survivorship benefits for the spouse and the children.
Calculating the value of life
PAUL SOLMAN: A lost life, therefore, costs the U.S. government a few hundred thousand dollars at most. With about 3,400 U.S. military deaths in Iraq so far, that would amount to a few billion.
Stiglitz, however, puts the real cost at upwards of $20 billion. That's because economic research shows that Americans themselves value a life at $6.5 million.
JOSEPH STIGLITZ: We know how much people require to compensate them to go into a riskier occupation where there's a higher probability of injury or a death. And it's on the basis of that that this $6 million is calculated and is used throughout the government and academia.
SCOTT WALLSTEN [Progress and Freedom Foundation]: It sounds callous, but there are a few things to keep in mind.
PAUL SOLMAN: Economists Scott Wallsten and Steven Davis are the authors of two other studies on the costs of the Iraq war. While their totals are lower that Bilmes and Stiglitz, they agree that military insurance vastly underestimates the value of a human life.
SCOTT WALLSTEN: The commission that compensated survivors of 9/11 victims based their estimates on the net present value of the victims' future earning streams.
STEVEN DAVIS [University of Chicago]: I don't think there's any way to get around treating lives as something that have implicit economic value.
PAUL SOLMAN: Do you feel a little crass putting a number on a life like that?
JOSEPH STIGLITZ: I do feel crass, but, on the other hand, I think it's even worse not to think about it.
PAUL SOLMAN: Meanwhile, we're not quite finished with the Bilmes-Stiglitz tally. Unlike the other two studies, they include presumed costs to the economy as a whole. The rise in the price of oil, for example, up about $40 a barrel since the war began, costing Americans out-of-pocket, the money flowing to other economies instead of ours.
Ascribing between $5 and $10 of the increase to the war, Stiglitz and Bilmes come up with another range of numbers, huge numbers. And that's how they get to $2 trillion, almost $20,000 for every single American household.
And you could go even higher than they do, including a cost like the absence of the National Guard during disasters, Hurricane Katrina or the Kansas tornado. Nor do any of the estimates include the interest on all the extra debt we've taken on to pay for the war.
And how do you reckon the cost to Iraqis of a protracted war on their turf?
JOSEPH STIGLITZ: If you start thinking about the number of lives who have been killed in Iraq, numbers that have been estimated anywhere from 100,000 to 500,000...
PAUL SOLMAN: And $6 million per person...
JOSEPH STIGLITZ: ... we didn't do that, because it would be mind-boggling.
Comparison to containment policy
PAUL SOLMAN: Now, remember, Bilmes-Stiglitz is the high estimate. Their rival authors think their health care and disability estimates are too high, dismiss the macroeconomic effects by saying the link to the war is too iffy, and, after all, the economy's been doing fine.
They also highlight costs that should be subtracted from the total, the cost of continued murders by Saddam Hussein, for example, had we continued our policy of containment, the cost of the whole policy of containment.
STEVEN DAVIS: We had been pursuing a policy of containment for about a dozen years that was endorsed by the United Nations Security Council. That was also a costly policy. So the alternative to the war wasn't to do nothing or to spend nothing; it was to either continue the containment policy or adopt some other policy which would have also had costs.
PAUL SOLMAN: But though their estimates are therefore lower -- $700 billion for Steven Davis; $1 trillion for Scott Wallsten, on whose study much of Bilmes-Stiglitz was based...
SCOTT WALLSTEN: What strikes me is just the enormity of the resources that we're using for this war and how they're being allocated without critical, rigorous thought as to what we're doing with them. These numbers are so enormous that they warp our sense of perspective.
PAUL SOLMAN: This leads to one last point. The way that economists gain perspective on any course of action is to look at what's called the opportunity cost -- that is, what could America have done with the same amount of money?
GREG SPEETER: We could have built 3.7 million housing units over the period of the war.
PAUL SOLMAN: The National Priorities Project's Greg Speeter.
GREG SPEETER: Every half-second, we could be providing a child with health care.
PAUL SOLMAN: We could have rebuilt the nation's schools, all of them, for about what we've spent each year in Iraq.
JOSEPH STIGLITZ: We could have fixed the Social Security problem for the next 75 years.
PAUL SOLMAN: Finally, if you're more worried about homeland security, think of $1 trillion or $2 trillion more spent on that.
In the end, though, this is a nearly $14 trillion-a-year economy. The Iraq war may now be the second most expensive in American history in direct cost, but we're so much richer it represents a smaller portion of the economy than any major conflict to date.
Small wonder many Americans haven't noticed the cost. But some certainly have: the Americans who disproportionately bear the cost of the Iraq war. In our next report, we'll look at who they are.
Posted by Mark Thoma on Friday, May 25, 2007 at 03:06 AM in Economics, Iraq | Permalink | TrackBack (1) | Comments (50)

When you figure the medical, disability, and death benefits costs of the war you need to add approximately 25% more to cover the costs of the civilian contractors.
The taxpayer is footing the entire bill.
There are nearly as many contractors in Iraq right now as there are soldiers.
www.dbacomp.com for more on this
Posted by: Marcie Hascall Clark | Link to comment | May 25, 2007 at 06:06 AM
Thank you so much for this important post, however as usual with public television news I find the coverage trivial and slanted to the conclusion that when all is done Iraq is the second most expensive war but really really really cheap since we are so rich. Let's fight another then.
"In the end, though, this is a nearly $14 trillion-a-year economy. The Iraq war may now be the second most expensive in American history in direct cost, but we're so much richer it represents a smaller portion of the economy than any major conflict to date."
Posted by: anne | Link to comment | May 25, 2007 at 06:45 AM
"Congress has approved about $450 billion to date for the Iraq and Afghanistan wars."
When I have a little time I will find the latest reference on direct appropriations for the wars and occupations, but as usual the number used is ridiculously low. The Washington Post's total of just weeks ago was $609 billion as of the beginning of fiscal 2007, or October 2006.
Posted by: anne | Link to comment | May 25, 2007 at 07:02 AM
These are just the economic costs of course. There are far more costs, and perhaps more damaging. Such as the loss of world respect for the US, the slippage of the US into using torture, the precedent for Washington to lie to the American public, the image of the US as world predator and killer slaughtering thousands of innocent people for the "fun"? of it, the certainty of another failure to blot the record of our declining empire. (This last may be the one benefit of the war, if it teaches the unteachable Americans anything). And much more that will appear in time.
And the spread of hypocrisy and lies to all sectors of US politics. I think of the present Democrite statement that they are "just beginning" to oppose the Iraq war, a statement so full of crap it can hardly be believed. They could have ended this war by now, but are too cowardly to do so, as Pat Buchanan has so well pointed out. I don't think the US has any idea of the total "price" that has been and will be paid for this most stupid of all wars.
Posted by: anon | Link to comment | May 25, 2007 at 07:55 AM
TB fails to see the big picture. The Muslim militancy is the result of Western imperialism that still operates vs. the Muslim world. If the West stopped its imperialistic policy toward the Muslim world it in turn would have no reason to war vs. the West. This is so simple that many bright minds can't grasp it. The point was gingerly made by Ron Paul in the recent debate, setting off a firestorm of vitriol from stupidos like Giuliani. Iraq is simply one manifestation of continuing US/UK imperialism in the Middle East that began with the collapse of the Ottoman Empire. People like TB start on the basis of flawed assumptions about it all, and go on from there to weave intricate excuses of ugly imperialism.
Posted by: anon | Link to comment | May 25, 2007 at 08:15 AM
I might add that Zionists are almost always in the forefront of those attempting to justify Anglo-American imperialism in the Middle East. For the obvious reason that Israel was created as a colony under the auspices of Anglo-American imperialism and survives today under its protection. Zionist see Anglo-American imperialism as necessary to Israel's continued existence.
Posted by: anon | Link to comment | May 25, 2007 at 08:29 AM
Yes; the costs of the wars and occupation was $609 billion as of the beginning of fiscal 2007 or October 2006, with $145 billion more awaiting Congressional action of which about $100 billion was appropriated yesterday. So, $709 billion has been directly spent on the war and occupation with about $45 to come.
Public television tells us $450 billion has already been allocated, where either $609 billion or $709 billion should have been the figure or the $754 billion which will be soon allocated.
The cost figure used by public television news, especially by the supposed economics analyst is a disgrace but a typical disgrace.
Posted by: anne | Link to comment | May 25, 2007 at 09:02 AM
What bothers me is continually hearing and reading costs of the war in Iraq that are dreadfully old and low. While public television has decided for us that the cost of Iraq is cheap enough to fight 2 wars, public radio is using cost figures that are just as disgraceful and have not been looked to since fiscal 2005 or October 2004.
We have squandered insanely and tragically more than $700 billion on war and occupation, but the war and occupation will fly past $2 trillion dollars in cost when all is considered. But, the material cost as the physical and psychological and moral cost of war and occupation is trivialized and masked even by the media we might think most responsible.
Posted by: anne | Link to comment | May 25, 2007 at 09:24 AM
Yes; there is the problem. When the Los Angeles Times discovered that there had been more than 50,000 casualties among our soldiers in Iraq, an assistant secretary of defense immediately called the Dean of the researcher who published the data and the researcher to complain. Then, the data was mysteriously removed from where the researcher had access to it, which was on a government website. The new data told us there were only about 21,000 casualties. I was so gratified.
Posted by: anne | Link to comment | May 25, 2007 at 09:52 AM
Of course, the Veterans Administration had already reported that more than 100,000 returned soldiers from Iraq and Afghanistan had been granted disability status by October 2006. Again, more than 65,000 soldiers had been treated for psychological illnesses by January 2007. Then, military medical researchers found that 17.8% of returned soldiers were suffering from traumatic brain injuries.
What then is the casualty rate?
Posted by: anne | Link to comment | May 25, 2007 at 09:57 AM
The real "big picture": the logic used by Anon drives me to believe that US/UK imperialism in the Middle East (of course, let´s forget about french imperialism over there: Algeria, Tunis, Lebanon and Syria...)after the fall of the Ottoman EMPIRE, was/is caused by ottoman imperialism, that was itself a spawn of the previous Arabic imperialism (the Caliphate of Baghdad).
If one is going to resort to moral relativism ("...yes, they decapitate people, but that is not barabarism is just only proud people excercising what is an ancient way in the Middle East, and they are just reacting to a real threat"), you can do it both ways ("...yes, they are bombing the hell out of those poor arabs, but that is only a reaction to 9/11, and they (US/UK)have the long tradition of reacting and winning when attacked...".
By the way, I am Argentinian and my ancestors were syrians (arabic people).
They came here to Argentina a 100 years ago because they, as christians, a minority, were persecuted by the Ottomans. So, you see, we can really "expand" the picture if we want to.
Posted by: Julián Obaid | Link to comment | May 25, 2007 at 10:15 AM
Now, somehow public television news fails to tells us the expert experts from the University of Chicago who costed, yes costed the war for us before the war actually found the war would, well, pay for itself. War, we find, is, say, costless.
This year, which we are continually told will cost $8 billion a month directly for Afghanistan and Iraq has already had main appropriations of $70 billion and $100 billion and a supplemental of $15 to $20 billion.
Ah, we are not spending $8 billion a month then, as we were in fiscal 2005, but over $15 billion a month. Oh well.
Posted by: anne | Link to comment | May 25, 2007 at 10:16 AM
This is hysterical nonsense and David Kay knows better.
"An attack on the U. S. by just one or two terrorists with the right biological WMD would “cost” far more than both the Iraq war and containment combined, with potentially millions dead and a wrecked economy."
The problem is how do you deliver a bug virulent enough to kill millions that would act before containment is put in place. And no opening a canister in the subway or the Super Bowl is not going to accomplish it. A chemical attack could kill dozens, a biological attack conceivably could kill hundreds, though given current awareness this is unlikely, but what bug out there is so resistant to treatment that millions would die before the infection could be contained?
This is simple fear-mongering playing on ignorance about what chemical and biological weapons capabilities really are, particularly in a modern urban environment with ready access to medical care. If somebody would like to share the combination of bug and vector that would make this plausible then maybe we can talk. Otherwise this is pure rubbish.
Why isn't everyone in Africa dead of Dengue Fever? It is incurable, spreads easily by contact, and there have been a number of outbreaks in recent years. Well because even in areas of rural Africa unserved by medical care people will draw a lesson when people start dropping dead.
Posted by: Bruce Webb | Link to comment | May 25, 2007 at 10:35 AM
TB: Imagine an alternative world, in which the United Arab Republic (Egypt and Syria) defeated Israel, and/or renewable energy drastically cut down on demand for oil. Would triumphant Nasserism have been easier to deal with than petrostate-fueled extremism?
Militant Islam may be the immediate cause of the present bout of terrorism, but that's like saying that Archduke Ferdinand's assassination caused the First World War. Simmering resentments last for generations, as, indeed, we saw in the Balkans. The victors don't remember the same things as the losers.
Anne, user@harvard.edu: Is your name a clever female variant of "Anonymous"? Maybe I should call myself Arne or something. Signed, user@alum.mit.edu. We should meet, if only I were still in Cambridge.
Seriously, I wouldn't be surprised if the number is lower than it actually is. But does it really matter? i.e. Will it convince people to change their minds on the war? The war is a matter of order of magnitude.
Posted by: Anonymous | Link to comment | May 25, 2007 at 10:35 AM
Well, yes, numbers matter. Numbers matter especially to war lovers who are forever using numbers to show just how happily affordable war is, tra la. Numbers matter, say, like the number of Iraqi excess deaths since the war began or like the number of Iraqis wounded or the number who have fled Iraq or fled homes. Numbers matter so much the Iraqi government has masked the number of Iraqi deaths for what will soon be a year.
Posted by: anne | Link to comment | May 25, 2007 at 11:02 AM
Jim Lehrer, by the way, was the lovely anchor who 4 years ago basking in the triumph of shocking and awing, asked a group of panelists what we needed to do now in Iraq. There was this plan and that, but when the chair of the department of Middle Eastern studies at Columbia spoke, he said we had a matter of weeks to leave Iraq. We had to leave immediately. Lehrer, the lovely anchor, however immediately retorted, "you mean we should just cut and run?" Then, Lehrer simply went on to another panelist. I was astonished, and have not bothered with public television news since.
Posted by: anne | Link to comment | May 25, 2007 at 11:10 AM
Yes; as I was saying just this very morning, "Jake, have you checked the camel lately? Where's the therrmommeterr?"
Cough, cough, cough.
Posted by: anne | Link to comment | May 25, 2007 at 11:20 AM
Remind me never to ride a camel, again. Cough, cough, cough. "On to Iraq, Jake."
Posted by: anne | Link to comment | May 25, 2007 at 11:23 AM
Anne: Watch BBC instead of PBS, maybe you'll feel better. They at least aren't embarrassingly uninformed when they interview people, and actually try to ask probing questions rather than lobbing softballs. (It's debatable how much they succeed, though.)
Jim Lehrer is not the worst example of News Hour deficiencies -- that distinction probably goes to Margaret Warner. I remember several cringe-inducing moments when she totally behaved like an ignorant American with foreign guests, and didn't even do a good job of hiding it (as some good reporters can do).
And this is one of the better news shows on television. Read a newspaper instead -- it may still be biased, but it's at least better than TV.
Posted by: Anonymous | Link to comment | May 25, 2007 at 12:10 PM
Agreed completely; I have come to much appreciate the scope and thoroughness of BBC, while the willingness of reporters to be combative further impresses me. As for reading, I read the New York Times carefully.
Posted by: anne | Link to comment | May 25, 2007 at 12:17 PM
I wish it were amusing to watch people voice their paranoid fantasies, but it isn't.
If one looks at every effort made to date on "weaponizing" biological warfare agents, one sees the obvious fact that everything possible is done to in fact limit their spread, because a pandemic-type bioweapon isn't a weapon at all. It just kills indescriminately, and is as much or more of a danger to the attacker as the attacked. That is why anthrax has had so much attention given to it, because it is, in fact, not very contagious, and behaves more like a chemical attack than a plague.
Bioweapons are, however, very cool subjects for lurid action adventure fiction and motion pictures, and that is the primary source of information for people who natter on about the topic.
Or put another way, booga booga boo, and be sure you duct tape all your doors and windows because scary scary scary they're out to get you for sure.
Posted by: James Killus | Link to comment | May 25, 2007 at 12:40 PM
Hm. I wonder why Dick Cheney is quoted for just a couple of comments, and then disappears? It could be, of course, that, like the rest of the administration, he does not do math ("We have people for that..."). But, as we are indulging in paranoid fantasy here (according to James Killus... who has, apparently, not followed the rise in research to target genetic differences between people that could, in fact, lead to bioweapons that are eugenics-like in their specific effects....).... well, here's mine:
Dick Cheney and the others of this Kleptocracy are entirely unconcerned about the eventual costs of this war to the USA, because, like Haliburton, they have no intention of staying here. Methinks they are preparing new land in the Gulf for them currently, somewhere off the shore of sparkling Dubai.... all part of the degradation of the American brand...
Posted by: Robinia | Link to comment | May 25, 2007 at 01:11 PM
http://www.washingtonpost.com/wp-dyn/content/article/2007/05/07/AR2007050701582_pf.html
May 8, 2007
The Cost of War, Unnoticed: Why Iraq and Afghanistan Haven't Squeezed the Average American's Wallet
By Lori Montgomery - Washington Post
The global war on terror, as President Bush calls the fighting in Iraq and Afghanistan and related military operations, is about to become the second-most-expensive conflict in U.S. history, after World War II.
Since the Sept. 11, 2001, terrorist attacks, Congress has approved more than $609 billion for the wars, a figure likely to stand as lawmakers rework their latest spending bill in response to a Bush veto. Requests for $145 billion more await congressional action and would raise the cost in inflation-adjusted dollars beyond the cost of the wars in Korea and Vietnam.
But the United States is vastly richer than it was in those days, and the nation's wealth now dwarfs the price of war, economists said. Last year, spending in Iraq amounted to less than 1 percent of the total economy -- about as much as Americans spent shopping online and less than half what they spent at Wal-Mart. Total defense spending is 4 percent of gross domestic product, the figure that measures the nation's economic output. In contrast, defense spending ate up 14 percent of GDP at the height of the Korean War and 9 percent during the Vietnam War.
And this time, the war bill is going directly on the nation's credit card. Unlike his predecessors, Bush is financing a major conflict without raising taxes or making significant cuts in domestic programs. Instead, he has cut taxes and run up the national debt. The result, economists said, is a war that has barely dented the average American's pocketbook and caused few reverberations in the broader economy.
"This war is easier to manage because it's a very small portion of GDP compared to the past," said Robert D. Hormats, a managing director at Goldman Sachs and a former Reagan administration official who recently published a history of war financing. "Even the borrowing of money is relatively small compared to past wars, so the impact on the economy is relatively minor." ...
Posted by: anne | Link to comment | May 25, 2007 at 02:31 PM
Including most of the costs of containment is laughable on the face of it. The Persian Gulf is a dangerous neighborhood and we would have maintained a large naval and air presence in the region even if Saddam's Iraq had miraculously turned into Switzerland. So it's simply dishonest to try and attribute our presence in the region as a cost of containment. And the cost of maintaining the "no fly zones" was not a cost of containment, but more accurately a cost of trying to provoke Saddam into a war. This is critical because if those troops and forces would have been in the region (or even CONUS doing training) irrespective of whether Saddam was in power or not, then almost all of the containment costs are irrelevant to the analysis.
And in the Univ of Chicago paper by Steven Davis (along with Kevin Murphy and Robert Topel), "War in Iraq Versus Containment," he cites a CBO analysis of Bosnia and Kosovo that concludes the cost of peacekeeping at $226,000 per soldier per year for personnel compensation, transportation and support costs. These costs are wildly off the mark. The Army uses a FORCES model and Contingency Operations Support Tool (COST) to estimate personnel compensation, transportation and support costs. The numbers in those two models are WELL south of $226,000 per person. And the CBO numbers are not only overstated, but are amortized values that include fixed overhead costs that would have been incurred irrespective of whether or not there would have been a containment policy. A better analysis would have used marginal costs rather than amortized overhead.
Posted by: 2slugbaits | Link to comment | May 25, 2007 at 04:42 PM
Later I am going to read through some Niall Ferguson, who argues that history has shown developed economies have suprising capacity to fund wars. I was sent over the writing a while ago. I am not worried about our ability to materially afford Iraq however, but worried about the alternative development limits we run to because of Iraq. Iraq is destructive materially in a profound way, I argue. Also, we will, of course, as I wrote, soon be at $754 billion in direct spending for the war and occupation.
Posted by: anne | Link to comment | May 25, 2007 at 04:49 PM
James Killus... who has, apparently, not followed the rise in research to target genetic differences between people that could, in fact, lead to bioweapons that are eugenics-like in their specific effects
On the contrary, Robinia, I have at least a semi-professional interest in all manner of science fictional tropes, fantasies, and speculations. And I eagerly await our genetic overlords...did I say overlords? I mean protectors. I'm sure the day is coming when an AB negative targeted virus wipes out the...Basques. (Note to self: must write more stories involving Basques).
Not really expecting cutting-edge biowarfare to come from the caves of Afghanistan, but hey, I've been wrong before. Quick question though: how long did it take for you to realize that the anthrax attacks were from a domestic source?
Somebody needs to tell TB the difference between suicidal leadership and suicidal followership, though, and how, if your goal is to reestablish the Caliphate, it might help not to kill off all potential Caliphs.
Posted by: James Killus | Link to comment | May 25, 2007 at 04:49 PM
Slug, nicely argued.
Posted by: anne | Link to comment | May 25, 2007 at 04:52 PM
Apologies, James Killus. Apparently, you have been following the genetically-specific biowarfare edge. I suspected anthrax attack to have had a domestic perpetrator pretty quickly. Once you have read once about Dr. Strangelove, the mad science guy is not too hard to envision. I also suspect at least a few of those cave-dwelling jihadists have had US university science training, too...
But, my all-time favorite was the guy who drove his tractor right up onto the DC mall not so long after 9-11. He was upset about the end of tobacco subsidies doing in the "way of life" of his entire region. As he was a tractor-guy, it did not occur to anyone to stop him. Tractors, like science, are only dangerous in the "wrong hands" (determined via profiling). Me, I've always seemed to have two left ones....
None of which has much to do with adding up the incalculably expensive cost of pointless war. The pursuit of apparent pointlessness may appear to be madness from the outside, but, doubtless, from inside the perpetrator's head, it seems to all add up. Still, am glad the tobacco subsidies were not reinstated to avoid future tractor-attacks on the government, and, I think we should really consider whether this mad pursuit of jihadists (which seems to create many more of them than it eliminates) is proving affordable in any rational sense to the non-perpetrating public (who foot the bill).
Posted by: Robinia | Link to comment | May 25, 2007 at 06:28 PM
I have my doubts as to the availability of even P3 containment environments in Afghanistan...
I think we should really consider whether this mad pursuit of jihadists (which seems to create many more of them than it eliminates) is proving affordable in any rational sense to the non-perpetrating public (who foot the bill).
Any policy that produces the opposite effect to what is desired should indeed be reconsidered, if rationality is the goal.
Rationalization is another matter, of course. I'm reminded of the quack medicine "toxin purge," where increasing symptoms are considered to be a good thing, evidence that the "toxins are being purged" from the body.
Althernately, one may consider the whole thing as part of a giant scam to loot the U.S. Treasury. Most of the money being "spent" on Iraq, after all, is actually going into pockets in the U.S. And, of course, crippled soldiers do not show up on any corporate balance sheet, so they may be ignored.
But at least that would mean that the thing is in somebody's self interest, and I guess that's something. Murderous and sociopathic, but at least it's not insane, to quote George Papoon.
Posted by: James Killus | Link to comment | May 25, 2007 at 07:58 PM
There was a time, a brief time, when a Martin Luther King could crystallize considerable opposition to the war in Vietnam by taking a moral tack on the terrible self-defeating nature of the war in Vietnam and almost all war beyond. This is not a time when a moral argument against the war in Iraq has considerable resonance, though I do not know why. Possibly the reason a moral argument against Iraq is not presently resonant is simply the absence and rarity of a King.
Nonetheless, the argument against Iraq comes to the insanity of a war and occupation when America was in no way threatened, a war and occupation that have directly cost $709 billion, going to $754 billion, and in all will fly in cost over $2 trillion.
Posted by: anne | Link to comment | May 26, 2007 at 04:36 AM
So, yes, numbers are important is arguing against the terrible war and occupation since morality while there will not now do. The question then should be to look carefully at what the costs of Iraq really are, from the hundreds of billions being directly spent, to how to value the very lives taken, whether at $1500 an Iraqi life inadvertently lost, to the costs of life or soundness of a soldier.
A needless strategically insane war and occupation that have cost thousands of American dead, another hundred this month, tens of thousands of American casualties, over 100,000 disability grants made to returned soldiers by October 2006, over 65,000 soldiers treated for psychological illness by January 2007, 17.8% of returned soldiers suffering from traumatic brain injuries.
An immoral, yes immoral war and occupation, during which hundreds of thousands of Iraqi excess deaths have been recorded, and casualties uncounted. Millions of Iraqis displaced from Iraq or from home.
Posted by: anne | Link to comment | May 26, 2007 at 04:43 AM
Morally Iraq has been lost, for war or occupation were neither justified, nor could Iraq have been ours to win; strategically Iraq has been lost, for the war and occupation have extended interminably and continually harmed us; economically Iraq has been and will be a disaster of foregone opportunity.
We need to leave Iraq immediately, and we could leave Iraq immediately, but we will not; and the losses will continue morally, strategically and economically while many about do all they can to deny and belittle and justify the losses.
Posted by: anne | Link to comment | May 26, 2007 at 04:53 AM
Another measure of the insane direct cost of Iraq is that Iraq will cost $95 billion these coming 4 months. These surgy destructive fruitless tragic times will cost $23.7 billion a month through September 2007.
Posted by: anne | Link to comment | May 26, 2007 at 06:05 AM
The failure to properly record the disastrous cost of the war in and occupation of Iraq, related directly and importantly to a continuing failure to properly gauge costs of environmental degradation. Now, in gauging costs I am not thinking of being all that precise but just of showing what trade-offs amount to. We are arrived at a century since the birth of Rachel Carson, who began the environmental movement only in 1961, interestingly contemporary with Martin Luther King, an environmental movement that was a century in developing from Charles Darwin's "Origin of Species."
Posted by: anne | Link to comment | May 26, 2007 at 06:11 AM
Rachel Carson work brought forth immediate disparagement, disparagement that continues still with the precious and beautiful "Silent Spring" rated by lunatic conservatives recently as among the very most destructive books of the century. But, while the environment movement will not be turned from, we are far from properly and easily costing nature's degradation. Similarly, we turn decidedly from any proper costing of the tragedy of Iraq.
Posted by: anne | Link to comment | May 26, 2007 at 06:13 AM
http://www.newyorker.com/archive/1964/05/02/1964_05_02_035_TNY_CARDS_000276700?printable=true
May 2, 1964
Rachel Carson
By E. B. White
"When in my thoughts these shores, so different in their nature and in the inhabitants they support, are made one by the unifying touch of the sea. For the differences I sense in this particular instant of time that is mine are but the differences of a moment, determined by our place in the stream of time and in the long rhythms of the sea."
Rachel Carson is dead, but the sea is still around us, the edge of the sea still supports life in almost unbelievable variety, and the manufacturers of pesticides are enjoying their usual spring up-surge in sales. In the lower Mississippi, fish have been dying from a cause as yet undetermined. In Oklahoma, quail are not hatching their full clutches of eggs. In Maine, salmon bearing a rich payload of DDT have been taken from Sebago. In the Gulf of Mexico, shrimpers are wondering whether their catch will be next on the list of victims. In Washington, representatives of a chemical company that makes endrin have testified that no "substantial" amounts of the poison enter the Mississippi from the company's plant, but, as Miss Carson pointed out in her last book, no one can yet say what a "substantial" amount of a modern poison really is. The federal agencies concerned with the problem bicker among themselves. Secretary Udall recommends prohibiting the use of pesticides that do not remain on the field to which they are applied. Secretary Freeman argues that such a stricture is unwarranted, because "too little is known" about the persistence of pesticides and their movements. The Freeman doctrine appears to be that the less you know about a poison the freer you should feel to use it.
Right there, it seems to us, is the basic flaw in our regulatory machinery. American justice holds the accused person innocent until proved guilty; somehow this concept has crept over into industry, where it doesn't belong, and has been applied to products of all kinds. Why should a poison dust or spray, however greatly it may advantage a grower or a housewife in a private project, enjoy immunity while there is any reason to suspect that it may endanger the public health or damage the natural scene? Rachel Carson posed this question and spent years of hard work documenting her thesis. She was not a fanatic or a cultist. She was not against chemicals per se. She was against the indiscriminate use of strong, enduring poisons capable of subtle, long-term damage to plants, animals, and man. No contributor to these pages more effectively combined a warm passion for nature's mysteries with a cool warning that things can easily go wrong. We take her words seriously, and we'd like to see government departments set aside their jealousies and declare poison guilty until proved innocent.
There is a pond in Maine that has lately fallen on evil days, a victim of what Julian Huxley has termed "our effluent society." For countless thousands of years, Sebasticook lay peacefully under its sky, changing only as the seasons changed. For the past hundred years or so, it was a pleasant place for fishermen and campers. Then, almost overnight, the pond went bad. Its inlet began discharging a steady stream of raw sewage and industrial waste from the little town of Corinna, to the north. Invigorated by the sewage, plant life in the pond exploded, and the shores were ringed with green scum. Campers countered with a burst of poison spray. The spray slowed up the weed growth, but it also killed fish in great numbers. Soon, on top of a green-scum problem, the campers found themselves with a dead-fish problem. Health authorities banned swimming, because of the sewage. With no swimming, no fishing, and no untainted air, the pond was deserted by its habitués, who went elsewhere for recreation. Property values declined; the pond was as good as dead. We have no doubt that the resuscitation of Sebasticook is already under way, but it will not be easy, for it's never easy to restore a habitat whose balance has been deeply disturbed. This small lake is a sad reminder of what is taking place, in some degree, all over the land, from man's carelessness, shortsightedness, and arrogance. It is our pool of shame in this our "particular instant of time."
Posted by: anne | Link to comment | May 26, 2007 at 06:15 AM
"Our goal isn't to pursue jihadists, it is to eliminate the conditions that creates them."
Since you've argued that the jihadist cause is 100% religion, then you're advocating eliminating a religion.
Posted by: evagrius | Link to comment | May 26, 2007 at 06:16 AM
The United Nations (IRIN) has been recording environmental effects on Iraq of these terrible times of war and occupation, and the measures while woefully incomplete are simply chilling. * But, think to a direct cost these coming 4 months in Iraq of $23.7 billion a month.
We must leave Iraq immediately; we are not leaving immediately.
* Mark Thoma found for us, some months ago, a gross estimate of the material cost to Iraq of these last years.
Posted by: anne | Link to comment | May 26, 2007 at 06:30 AM
This war is a major waste of money and talent.
I think the truth is that it was considered a "tipping point" in that once we danced in and out, were greated by the grateful Iraqis, there would be a new democracy that would start a trend towards democracies being established all over the middle east. Oil was icing on the cake: US oil companies would be in control of much of it, to the enrichment of their elites running the companies.
What did we get? Lies. Not just WMD, the hidden terrible toll on the "contractors" which we are little aware of. We only see the mounting toll of US young men being killed. The figure would be much higher, if we also included the "contractors." Meanwhile, those who hate the US are having a field day working up anti-US sentimate all over the world.
Posted by: real person from the real world | Link to comment | May 26, 2007 at 08:22 AM
I have heard of a twist in how to look at the cost of war. These big numbers are hard to grasp. Maybe some economists can say whether these numbers are right. I hear that every $5,000,000 in government spending causes a premature death of an American. The mechanism seems to be that taking the money out of the economy through taxes decreases safety. So whatever the cost of the war in dollars, it should be possible to also view it in terms of loss of life. Since some of the cost of war is borrowed, the loss of life might apply to our children.
Well, regardless of whether that is a valid way to look at the cost, the cost is too high. I would favor the Ron Paul approach of avoiding war by not meddling in the internal affairs of other countries. (And if people want, he will lead us to much lower taxes, and presumabley greater safety.)
Posted by: Dar | Link to comment | May 26, 2007 at 12:31 PM
Precisely the tack Brad DeLong has taken:
April 23, 2007
http://delong.typepad.com/sdj/2007/04/falling_indicat.html
Falling Indicators of Human Development in Mississippi
Edited by Brad DeLong
Governor Haley Barbour manages to achieve a thing that many corrupt dictators have not: to lower the Human Development Index of the people he governs:
In Turnabout, Infant Deaths Climb in South
By Erik Eckholm - New York Times
[I]n recent years the [infant] death rate has risen in Mississippi and several other states. The setbacks have raised questions about the impact of cuts in welfare and Medicaid and of poor access to doctors.... “I don’t think the rise is a fluke, and it’s a disturbing trend, not only in Mississippi but throughout the Southeast,” said Dr. Christina Glick, a neonatologist in Jackson, Miss., and past president of the National Perinatal Association....
And, of course, Erik Eckholm doesn't have control over the data or the statistics.. He doesn't seem to know that there are 2.8 million people in Mississippi. He doesn't seem to know that about 15% of the non-elderly population--make that 350,000--were on Medicaid. Cut Medicaid enrollments by 50,000, by 1/7. 42,000 babies born in Mississippi each year. For the share who die to jump from 0.97% to 1.14%... That's a less than 1/3000 chance. That's worth saying.
Posted by: anne | Link to comment | May 26, 2007 at 12:51 PM
Though Governor Haley Barbour could subvert any public health program, the increase in infant mortality in Mississippi and elsewhere through the South appears directly related to failing to fund family health care needs as we were insanely funding destructiveness in Iraq.
Posted by: anne | Link to comment | May 26, 2007 at 12:54 PM
Numbers, we see do matter. How much mother-child well-being in Mississippi could be assured for a token amount of the $23.7 billion a month that will be spent these coming 4 months on Iraq? Governor Haley Barbour willing, of course.
Posted by: anne | Link to comment | May 26, 2007 at 12:57 PM
"Experts Calculate Billions in Long-term Costs of War" This headline, while literally true, is innumerate, as the war has already cost hundreds of billions of dollars in immediate spending. It's like saying, "This brand-new SUV will cost hundreds of dollars!" Or "Los Angeles is literally miles from New York!"
The long-term cost to the US of this aggressive war is probably tens of trillions of dollars. If I could do so, I'd make it cost those who drove us to war quadrillions of dollars.
The actual long-term damage to the world from the war -- demoting the US from its pedestal as an example of moral democracy (or just maybe exposing the horrid underside of US behavior) with strong economy and letting China replace us as the example of a powerhouse dictatorship economy -- creating a whole new young generation of people who hate the US -- overall destruction of democracy in the US -- might be measured in the quintillions of dollars.
Posted by: John H. Morrison | Link to comment | May 26, 2007 at 02:59 PM
Yes; clever when we are subject to the nutty fear-mongers mongering away about 12 trillion dollars in Social Security short or long falling in the coming 2 centuries. Social Security has of course a massive and growing surplus, while war which is impossibly expensive here and now, however, is as nothing.
Posted by: anne | Link to comment | May 26, 2007 at 03:33 PM
For a good analysis of the BUDGETARY costs of the wars in Afganistan and Iraq see the Congressional Research Office:
http://www.fas.org/sgp/crs/natsec/RL33110.pdf
The Budget Authority is about $600 billion through FY 2007. The actual costs of course will be much higher when the indirect costs and future costs are included. The most important costs though are additional recruits to various Jahidists causes, the loss of American influence, the destruction of the country of Iraq and the probably several million refugees (ticking bombs) created. Sadam Husein was an awful leader but he existed for a reason. Will his replacement make the US safer? Has his demise created a safer world for Iraquies?
We got into this war without much public analysis of the consequences of options. That mistake will not be corrected by a failure to attempt to analyze the consequences of options going forward. A first step is to admit to uncertainty and to the fact that the US is really limited in the extent to which it can control the outcome.
Posted by: Sonia | Link to comment | May 26, 2007 at 05:39 PM
Thank you so much, Sonia. But, again, recording the costs of war and occupation is tricky. Where the cost could be cited at $509 billion by October 2006, and about $95 billion higher with the passing of the latest allocation, to make $604 billion, I have been conservatively adding $105 billion to bring the costs above $705 billion. Why? The answer is private contracting which has previously run about $8.8 billion a month for Iraq and Afghanistan, and is running $10 billion a month since October 2007. I have only taken the private contracting payments for fiscal 2006, which were $105 billion.
Posted by: anne | Link to comment | May 27, 2007 at 08:52 AM
http://www.fas.org/sgp/crs/natsec/RL33110.pdf
March 14, 2007
Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11
By Amy Belasco - Congressional Research Service
Summary
With enactment of FY2007 appropriations, Congress has approved a total of about $510 billion for military operations, base security, reconstruction, foreign aid, embassy costs, and veterans' health care for the three operations initiated since the 9/11 attacks: Operation Enduring Freedom (OEF) covering Afghanistan and other counter terror operations, Operation Noble Eagle (ONE) providing enhanced security at military bases, and Operation Iraqi Freedom (OIF), Iraq.
The $510 billion total includes the $70 billion in DOD's regular FY2007 bill intended to bridge the gap between the first part of the fiscal year and passage of a supplemental as well as war-related appropriations for other agencies included in the FY2007 Continuing Resolution (H.J.Res 20/P.L.110-5).
Of the $510 billion appropriated thus far, CRS estimates that Iraq will receive about $378 billion (74%), OEF about $99 billion (19%), enhanced base security about $28 billion (5%) with about $5 billion that CRS cannot allocate (1%). Generally, about 90% of these funds are for DOD, about 7% for foreign aid programs and embassy operations, less than 1% for medical care for veterans, and 1% unallocated. DOD has not provided Congress with the cost of each operation for all previously appropriated funds.
On February 5, 2007, the Defense Department submitted a $94.4 billion FY2007 Supplemental request. If enacted, DOD's total emergency funding for FY2007 would be $163.4 billion or 40% more than the previous year and 50% more than OMB estimated last summer. The Administration also requested about $3 billion for Iraq and $1 billion for Afghanistan in emergency foreign and diplomatic operations funds. If the FY2007 Supplemental request is approved, total war-related funding would reach about $607 billion including about $448 billion for Iraq, $126 billion for Afghanistan, $28 billion for enhanced security and $5 billion unallocated.
For FY2008, DOD requested $481.4 billion for its regular or baseline budget and $141.7 billion for war costs. If Congress approves both the FY2007 and FY2008 war requests, total funding for Iraq and the Global War on Terror would reach about $752 billion, including about $564 billion for Iraq, $155 billion for Afghanistan, $28 billion for enhanced security, and $5 billion unallocated.
Based on new data, CRS lowered its estimates for DOD's average monthly obligations for contracts and pay to $8.8 billion per month including about $7.4 billion for OIF, $1.4 billion for OEF. DOD reports that in FY2007 so far, spending rose to $10 billion per month including $8.6 billion for Iraq and $1.4 billion for OEF....
Posted by: anne | Link to comment | May 27, 2007 at 08:54 AM
My oh my, I have a stalker, a crazed intimidating stalker; a stalker intent on foul-mouthed intimidation of every other participant.
Posted by: anne | Link to comment | May 27, 2007 at 12:59 PM
If you haven't seen the film WHEN I CAME HOME yet, watch this one-minute trailer at :
http://www.whenicamehome.com
Its all about homeless Iraq War veterans in New York City.
Support our Veterans!
Posted by: SUPPORT THE VETS | Link to comment | Jun 24, 2007 at 08:05 PM