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Cost of War

Congressional Democrats estimate cost of the wars so far to be $1.5 trillion. $800 billion requested, with the rest coming from high oil costs, reservists being pulled out of the productive economy, interest on money borrowed to pay for the war, forgone investment return on war expenditures, and veteran treatments (though the bottom of the article puts that at $30 billion, chump change on this scale.) White House calls it inaccurate and politically motivated.

Apparently reservists often come home, if they do, to find that they don't have a job anymore, with minimal help from the government.

Do the numbers make sense? Let's make some estimates -- not for precision, not even ballparks I'd necessarily bet on; sometimes the estimation itself is informative, or at least pleasant.


I can't tell easily how many reservists are activated or what that means. I've seen 7 brigades in Iraq, for 14,000-21,000 people, but also reports of 130,000 reservists activated -- are those support troops overseas, or ones here?

Assuming $20,000 per reservist civilian job, that's lost income (and economic output) of $280 million to $2.6 billion a year. Probably double or triple that, since I was lowballing the salary estimates, and workers generally produce more than they get paid. That's still an upper bound of $9 billion * 6 years = $54 billion.

US consumes about 388 million gallons of gasoline a day, call it 140 billion gallons a year. Say prices jumped 50 cents a gallon for 2003 through 2005, and another 50 cents for 2006 through 2007 (prices have gone higher, but they also go down, I'm trying to do a half-assed integral here), and say we can blame that almost entirely on the war, then that's additional oil costs of 3*$70 billion + 2 * $140 billion = $490 billion. Even if you skeptically knock off a fair bit of that, you'd still get $300 billion. If you assume most of it would have happened anyway, and the war's only good for 10 cents on the gallon, that'd be $70 billion.

If we'd borrowed the $800 billion war cost at 5% interest, that'd be $40 billion a year. If we'd borrowed the same amount but invested it in something (infrastructure? education?) at 6% then we'd be making $8 billion, rather than spending $40 billion. $800 billion is from the article, and might be high; I see somewhat lower numbers on the web, and maybe a fifth of that is Afghanistan, which had some justification. So maybe a conservative interest/investment total cost of $80 billion for the past four years, and a bold estimate (use full figure, assume 8% investment return) of $200 billion.

We've lost 3000 soldiers in Iraq, and maybe 4-5 times that have been crippled. Monetary value estimates on an American life are in the $1-3 million range, I think, so losses of $3-15 billion, particularly including medical costs. Then there's knock-on costs of "hey, I lost my husband/father" which I won't try to estimate.

So, on the high end, additional costs of $490+200+54+15 = $760 billion. Lower end, maybe $300 billion.


The exchange rate GDP of Iraq is about $40 billion/year, by the way. So just the amount we've openly spent so far, never mind these additional estimates, has been a decade's worth of Iraq's entire economy. We're spending twice as much money on Iraq as it produces, per year. Somehow I don't think their standard of living has tripled.

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( 13 comments — Leave a comment )
slow_war
Nov. 13th, 2007 11:17 pm (UTC)
Iraqi Standard of Living
It has in fact declined tremendously for most people, even exclusive of the violence they face on a daily basis. Services have broken down, schools are unfunded or non-existent, and professionals have fled the country. One of my interpreters told me that he was a medical student: "But all my professors left the country because they were afraid of the irHabiin [troublemakers, i.e. insurgents]. Then the irHabiin blew up my college...."
jordan179
Nov. 14th, 2007 05:21 pm (UTC)
The relevant question is:

How much would it have cost us if we had left Saddam Hussein alone?
mindstalk
Nov. 14th, 2007 07:11 pm (UTC)
The word "nothing" comes to mind.
jordan179
Nov. 14th, 2007 07:45 pm (UTC)
You're assuming that if we left Saddam alone, that he would have left us -- and our allies -- alone. This is not a safe assumption.
mindstalk
Nov. 14th, 2007 08:25 pm (UTC)
Saddam Hussein ran a bankrupt country with no WMDs, and a past history of engaging in aggressive behavior *when potentially profitable*. Leaving us alone seems a very safe assumption, since he lacked means or motive.

You're probably concerned about his payments to the families of Palestinian bombers. I could respond with "proportional response", e.g. what trashing an entire country isn't. Or I could note that for what we've spent we could airlift the entire Palestinian population to civilized countries, with a $100,000 bonus per capita to boot, rather than getting 3000 Americans killed, another 10-20,000 crippled, and tens of thousands of Iraqis killed while *still* not solving the Palestinian problem. The words "not cost-effective" come to mind.
jordan179
Nov. 15th, 2007 01:29 am (UTC)
Saddam Hussein ran a bankrupt country with no WMDs, and a past history of engaging in aggressive behavior *when potentially profitable*. Leaving us alone seems a very safe assumption, since he lacked means or motive.

Yet, in reality, he repeatedly violated the terms of the truce which ended the 1990-91 war, to the point of actually shooting at American warplanes, and at one point launching a probing raid into Kuwait. He seems not to have been taking your advice, and based on his prior history, I'm fairly certain that if we'd just left him alone, he would have attacked us or our allies at some point.

I could respond with "proportional response", e.g. what trashing an entire country isn't.

Two points:

(1) We have no responsibility to respond "proportionately" to attacks. Proprotionate response means that one gives up on the goal of victory, and lets the other side set the intensity of the war. This means a surrender of the initiative, and a loss of the advantages of superior strength.

Proportionate response is, in short, a suckers' game.

(2) We didn't "trash the whole country," though we most certainly could have done so. Instead, our invasion took care not to smash the Iraqi infrastructure.

The main reason why Iraq is still a mess is the "insurgency." Are you holding us responsible for the actions of the enemy?

By that logic, it was the Allies who were responsible for the Holocaust, since Hitler would rather have expelled the Jews, but was deprived of that option by the Allied blockade!

mlc23
Nov. 14th, 2007 09:58 pm (UTC)
Lots of evil dictators have no other motive than just to stay in power. In that case, screwing with the US is not a good idea.

There is also the example of al-Gaddafi in Libya, who has started to play nice because he has decided that being a regional player is possible if you have some legitimacy in the international community.
jordan179
Nov. 15th, 2007 01:24 am (UTC)
Lots of evil dictators have no other motive than just to stay in power. In that case, screwing with the US is not a good idea.

Saddam repeatedly demonstrated his recklessness. He launched two wars of aggression (against Iran, then against Kuwait) and refused to abide by the terms of the truce ending the last one.

There is also the example of al-Gaddafi in Libya, who has started to play nice because he has decided that being a regional player is possible if you have some legitimacy in the international community.

Qadaffi stopped sponsoring international terrorism for one reason and one reason alone -- he saw the mood America was in after 9-11, and realized that he was going to get invaded and overthrown if he didn't "play nice." Had we pursued a less agressive enforcement of our rights viz Afghanistan and Iraq, Qadaffi would not have changed his ways.


mindstalk
Nov. 15th, 2007 01:32 am (UTC)
Oh look, you're lumping Afghanistan and Iraq together again.

Afghanistan: home of a terrorist network which actually attacked the US.

Iraq: not.

Not to mention the crappier human rights conditions under the Taliban... not that our policy is governed by such things.
(Anonymous)
Nov. 15th, 2007 02:04 am (UTC)
Oh look, you're lumping Afghanistan and Iraq together again.

I am, quite intentionally, considering them as two campaigns of the same war, rather than different wars.

Afghanistan: home of a terrorist network which actually attacked the US.

Iraq: not.


Iraq: home of a state which actually attacked US forces and violated the truce that ended the 1990-91 war all through the 1990's. And the Iraqi attacks included an attempt on the life of the former President Bush, so you can't even argue that they were only going after military targets.

Not to mention the crappier human rights conditions under the Taliban... not that our policy is governed by such things.

Our policy is not governed by such things, but it is most certainly influenced by them. Besides, given Saddam's sadistic tyranny, about the only thing you can say about Saddam's violations of human rights compared to Omar's is that at least Saddam's weren't religiously inspired.
jordan179
Nov. 15th, 2007 02:05 am (UTC)
Previous statement: me. I forgot to log in when I posted.
mlc23
Nov. 14th, 2007 09:51 pm (UTC)
Well, it was costing us something in terms of Operation Southern Watch - the mission to patrol Iraqi airspace. The air force actually had a pretty heavy deployment rotation (well, heavy for the air force :) ) for it.

I don't know what the answer was there, since OSW was becoming an expensive burden (though certainly not as expensive as OIF), but I don't think invasion was the best choice.

I definitely think in terms of cost/benefit there are better places we could be spending the money - national security wise.

And I think slow_war's point is valid - the day-to-day lives of the Iraqi people are worse off because of the war.
mindstalk
Nov. 15th, 2007 01:29 am (UTC)
I didn't think of the air patrols. How expensive? Not that it could compare to the war, as you say. Wikipedia says the patrols and bombings intensified in 2002 as preparation for the war (Operation Southern Focus.)

In the meantime I hear we're still not guarding our infrastructure properly. Or even maintaining it *cough* 13% of bridges rated as under par *cough*.
( 13 comments — Leave a comment )

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