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View Full Version : Cost of Iraq war could surpass $1 trillion


RVD
Mar 18th, 2006, 07:00 AM
Honestly now...
Is anyone really surprised?! :shrug:

http://www.msnbc.msn.com/id/11880954/
Estimates vary, but all agree price is far higher than initially expected

By Martin Wolk
Chief economics correspondent
MSNBC
Updated: 7:25 p.m. ET March 17, 2006

One thing is certain about the Iraq war: It has cost a lot more than advertised. In fact, the tab grows by at least $200 million each and every day.

In the months leading up to the launch of the war three years ago, few Bush administration officials were willing to comment publicly on the potential costs to the United States. After all, no cost would have been too high if the United States faced an imminent threat from an Iraq armed with weapons of mass destruction, the war's stated justification.

In fact, the economic ramifications are rarely included in the debate over whether to go to war, although some economists argue it is quite possible and useful to assess potential costs and benefits.

In any event, most estimates put forward by White House officials in 2002 and 2003 were relatively low compared with the nation's gross domestic product, the size of the federal budget or the cost of past wars.

White House economic adviser Lawrence Lindsey was the exception to the rule, offering an "upper bound" estimate of $100 billion to $200 billion in a September 2002 interview with The Wall Street Journal. That figure raised eyebrows at the time, although Lindsey argued the cost was small, adding, "The successful prosecution of the war would be good for the economy.”

U.S. direct spending on the war in Iraq already has surpassed the upper bound of Lindsey's upper bound, and most economists attribute billions more in indirect costs to the war effort. Even if the U.S. exits Iraq within another three years, total direct and indirect costs to U.S. taxpayers will likely by more than $400 billion, and one estimate puts the total economic impact at up to $2 trillion.

Back in 2002, the White House was quick to distance itself from Lindsey's view. Mitch Daniels, director of the White House budget office, quickly called the estimate "very, very high." Lindsey himself was dismissed in a shake-up of the White House economic team later that year, and in January 2003, Defense Secretary Donald Rumsfeld said the budget office had come up with "a number that's something under $50 billion." He and other officials expressed optimism that Iraq itself would help shoulder the cost once the world market was reopened to its rich supply of oil.

Those early estimates struck some economists as unrealistically low. William Nordhaus, a Yale economist who published perhaps the most extensive independent estimate of the potential costs before the war began, suggested a war and occupation could cost anywhere from $100 billion to $1.9 trillion in 2002 dollars, depending on the difficulty of the conflict, the length of occupation and the impact on oil costs.

The most current estimates of the war's cost generally start with figures from the non-partisan Congressional Budget Office, which as of January 2006 counted $323 billion in expenditures for the war on terrorism, including military action in Iraq and Afghanistan. Just this week the House approved another $68 billion for military operations in Iraq and Afghanistan, which would bring the total allocated to date to about $400 billion. The Pentagon is spending about $6 billion a month on the war in Iraq, or about $200 million a day, according to the CBO. That is about the same as the gross domestic product of Nigeria.

Scott Wallsten, a resident scholar at the conservative American Enterprise Institute, put the direct cost to the United States at $212 billion as of last September and estimates a "global cost" of $500 billion to date with another $500 billion possible, with most of the total borne by the United States.

PAGE 2 LINK HERE... http://www.msnbc.msn.com/id/11880954/page/2/

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This is absolutely amazing!
Never in my wildest dreams would I have EVER thought the American people [especially Congress] asinine enough to spend $500 BILLION, let alone $1 TRILLION!!!!! :fiery:

That's 1000 BILLIONS folks!!

Just one question...
What is the return on this investment???????????????????????????????

Veritas
Mar 18th, 2006, 07:04 AM
Shocking :eek:

And to think there's still countries out there in desperate need of capital. Couldn't the U.S. have at least spent that amount on their own poor and unemployed?

What is the return on this investment???????????????????????????????

Satisfaction that the U.S. is still the world's most powerful country? :p

Lord Nelson
Mar 18th, 2006, 12:45 PM
Shocking :eek:

And to think there's still countries out there in desperate need of capital. Couldn't the U.S. have at least spent that amount on their own poor and unemployed?



Satisfaction that the U.S. is still the world's most powerful country? :p
The American economy is actually healthier than those of many European nations. But you are right, instead of wasting money giving to the Palestinians with the region in Hamas's hands, the U.S. would be better of in giving that money to social programs in the U.S.

^bibi^
Mar 18th, 2006, 12:46 PM
The American economy is actually healthier than those of many European nations.

:haha: :haha:

Veritas
Mar 18th, 2006, 01:18 PM
The American economy is actually healthier than those of many European nations. But you are right, instead of wasting money giving to the Palestinians with the region in Hamas's hands, the U.S. would be better of in giving that money to social programs in the U.S.

Exactly.

But the U.S. economy's becoming more of a worry. It's better off than Europe (Italy's GDP shrank last year, Germany has an unemployment rate of nearly 10% and France's economy's basically been stagnant for God knows how long), but then again, health care, labour, and just public costs in general are eating into American pockets.

This is a crucial time for the U.S. to step up a gear if it hopes to remain at the centre of the world's spotlight. China, India and maybe Russia are rising fast. Even Japan, who's had a decade of economic problems, outgrew and outperformed the U.S. since its reforms took effect in 2003.

Countries are improving left to right, and the U.S. must at least keep up with the pace. The "at least we're better off than the Europeans" excuse won't work for long - Germany, also infamous for economic stagnation, is slowly getting back on its feet. New and old competitors are popping up, and out of the blue, the U.S. decides to blow trillions on a war that makes little to no sense.

IMO, Bush should concentrate on how to put a brake on the U.S. enormous trade deficits. It's an embarassment that nearly all of its bonds, securities and gold are held in Chinese and Japanese hands. That means the Americans are relying on foreign capital to make sure the economy doesn't collapse from the weight of its national debts.

Imagine how much debt the U.S. could've gotten rid with the money spent on the war!

Cashif
Mar 18th, 2006, 01:53 PM
Does anyone really care, if anyone really does then that chimp President wouldnt have been elected back to power..

Lord Nelson
Mar 18th, 2006, 02:24 PM
:haha: :haha:
I see that economics is not really your thing. Check the financial news now and then and you would see that the U.S.'s economy is growing faster then let say Belgium's. Veritas seems to be quite knowledgable on he subject so read what she said in her post above. So U.S. is doing well but should remain careful if it does not want to stagnate in the near future. As for you I suggest you read more of 'The Economist' and less of 'Voici'. :wavey:

PamShriverRockz
Mar 18th, 2006, 02:43 PM
Jeez. :speakles: *sigh*

Scotso
Mar 18th, 2006, 02:51 PM
Worse than the monetary cost is the cost in lives. Conclusion? This "war" has been a tremendous waste.

wipeout
Mar 19th, 2006, 12:40 AM
All those tens of thousands of lives lost, hundreds of thousands of lives damaged and a trillion dollars spent and it's all basically just for one set of a few hundred politicians to remove another set of a few hundred politicians from their jobs. :tape:

Martian Jeza
Mar 19th, 2006, 12:45 AM
I see that economics is not really your thing. Check the financial news now and then and you would see that the U.S.'s economy is growing faster then let say Belgium's. Veritas seems to be quite knowledgable on he subject so read what she said in her post above. So U.S. is doing well but should remain careful if it does not want to stagnate in the near future. As for you I suggest you read more of 'The Economist' and less of 'Voici'. :wavey:

Comparing Belgium with the US is totaly ridiculous !

Lord Nelson
Mar 19th, 2006, 01:07 AM
Comparing Belgium with the US is totaly ridiculous !
I mentioned Belgium becasue it was in bibifoc's avatar. Ok then France with the U.S. or Germany with U.S. Both Germany and France are worse financial situation than U.S. Look what is happening in France right now because of the CPE which unfortunately is needed. Many in France say that no country would like to adopt their economic system with 35 hours of work and a rigid economic system compared to the UK or U.S.

Martian Jeza
Mar 19th, 2006, 01:07 AM
Ok then France with the U.S. or Germany with U.S. Both Germany and France are worse financial situation than U.S. Look what is happening in France right now because of the CPE which unfortunately is needed. Many in France say that no country would like to adopt their economic system with 35 hours of work and a rigid economic system compared to the UK or U.S.

We are one of the most little country in the world, you cannot compare us with the US....

Lord Nelson
Mar 19th, 2006, 01:12 AM
We are one of the most little country in the world, you cannot compare us with the US....
Make up your mind you are Swiss or Belgian. :p
I am Swiss too by the way, from Geneva. I mentioned Belgium just like that. I meant to compare Europe as a whole compared with the U.S. and if you work in the financial sector you would hear your co workers say that economic situation is better in U.S. then here. But we have the secret bancaire. ;)

Martian Jeza
Mar 19th, 2006, 01:19 AM
Make up your mind you are Swiss or Belgian. :p
I am Swiss too by the way, from Geneva. I mentioned Belgium just like that. I meant to compare Europe as a whole compared with the U.S. and if you work in the financial sector you would hear your co workers say that economic situation is better in U.S. then here. But we have the secret bancaire. ;)

At tennis side, I'm Swiss Minded : Martina Hingis ( my tennis idol ) and a bit Federer ;)

At other things, I'm Belgian 101% : Anyway, I'm not into economic things, this is a thing I should learn ...

Justeenium
Mar 19th, 2006, 03:40 AM
At tennis side, I'm Swiss Minded : Martina Hingis ( my tennis idol ) and a bit Federer ;)

At other things, I'm Belgian 101% : Anyway, I'm not into economic things, this is a thing I should learn ...

http://www.weforum.org/site/homepublic.nsf/Content/Global+Competitiveness+Programme%5CGlobal+Competit iveness+Report

;)

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