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Report: Iraq War could end up costing more than WWII


War has never been cheap, but it sure is expensive now.

Think about G.I. Joe slugging his way through Europe on K Rations, cigarettes and his M1 Garand, and compare that to today's forces. As we recently heard from Joint Chiefs chairman Gen. Martin Dempsey, it takes 22 gallons of fuel to support one soldier per day in Afghanistan, up from one gallon per day back in World War II. Today's troops fly around in helicopters and cargo aircraft; go to fight with advanced electronic equipment; and often can get at least three flavors of ice cream back in the chow hall.

War today is so expensive, in fact, that Iraq alone may wind up costing more than all of World War II, even adjusted for inflation, according to a report quoted by the Christian Science Monitor. Let's be clear -- as with all military math, these numbers could be fuzzier than the dice under your rear-view mirror, because of the many ways you can slice and calculate the data. But it's probably fair to say they're at least somewhere in the ballpark of the truth, even though we may never know exactly what the full cost of the past decade has been.

Here's how David R. Francis put it in the Monitor:

President Obama’s announcement that all US troops will be out of Iraq by year end should mean some drop in ongoing military spending. But the budget relief probably won’t be as much as you might expect. Tragically, beside the financial cost, there is the human toll. The war in Iraq has resulted in some 4,480 US troops killed and more than 32,000 wounded. (The Iraqis have suffered far more fatalities, about 654,965, according to the British medical journal The Lancet.) Thus, ongoing medical and disability claims and treatment of US veterans will boost the costs of the Iraq war even more.

Throw in the replacement of vehicles, weapons, equipment, etc., and the eventual tab for the United States could reach $4 trillion to $6 trillion, according to University of Columbia economist Joseph Stiglitz and Harvard University budget expert Linda Bilmes. Those are big numbers.

They would be on par with the $4.6 trillion the US spent on the recent financial bailouts, according to Barry Ritholtz, CEO of Wall Street research firm Fusion IQ and author of the popular blog The Big Picture. (Another estimate puts the bailout cost at $8.7 trillion.) The sum spent on the Iraq war could pay for a good chunk of Obamacare, professor Bilnes estimates. It’s more than the $3.6 trillion the US spent to fight World War II, even after adjusting for inflation, Mr. Ritholtz estimates.

Washington was not prepared to pay -- or even acknowledge -- these kinds of costs, Francis writes:
When President George W. Bush launched the war, charging incorrectly that Iraq had weapons of mass destruction, the Pentagon estimated its cost at $50 billion to $60 billion. Economic adviser Lawrence Lindsey got in hot water at the White House when he guessed in public the war could cost as much as $200 billion. One oddity of the Iraq and Afghanistan wars is that even as military preparations were under way, Congress cut taxes in 2001 and again in 2003. These Bush tax cuts meant in effect that the wars were financed by adding to federal debt, rather than paid for from revenues. US outstanding debt zoomed from $5.7 trillion when Mr. Bush took office to $10.6 trillion when he left. And all but $700 billion of that debt was accumulated before the Wall Street bailouts began under the Troubled Asset Relief Program in October 2008.
Francis doesn't say so, but President Obama and Congress have continued adding to the debt, to the tune of more than $14.8 trillion as of Tuesday afternoon. (You can check the latest numbers here, including your personal share!) That's the mountain that the "super committee" is tasked to start chipping away by eliminating about $1.2 trillion by Christmas -- some of which could come from DoD's budget.

It's a depressing analysis: At the end of World War II, the United States emerged as a global superpower and led the world for the rest of the 20th century. As for this year's planned end of the Iraq War -- the jury's still out.

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