The financial costs of war
With increasing frequency, I’ve noticed that Barack Obama and Hillary Clinton make a point of emphasizing the extraordinary financial costs associated with the war in Iraq. The message must be resonating with voters because this morning, the president offered a detailed response to the charge.
Indeed, I’ve been listening to Bush’s speeches on Iraq since the beginning, and I think this was the most detailed take on the financial costs of the war he’s ever made.
“Some in Washington argue that the war costs too much money. There’s no doubt that the costs of this war have been high. But during other major conflicts in our history, the relative cost has been even higher.
“Think about the Cold War. During the Truman and Eisenhower administrations, our defense budget rose as high as 13 percent of our total economy. Even during the Reagan administration, when our economy expanded significantly, the defense budget still accounted for about 6 percent of GDP. Our citizens recognized that the imperative of stopping Soviet expansion justified this expense.
“Today, we face an enemy that is not only expansionist in its aims, but has actually attacked our homeland — and intends to do so again. Yet our defense budget accounts for just over 4 percent of our economy — less than our commitment at any point during the four decades of the Cold War. This is still a large amount of money, but it is modest — a modest fraction of our nation’s wealth — and it pales when compared to the cost of another terrorist attack on our people.”
As White House rhetoric goes, that may not sound like an awful pitch, but there are three key angles to this that are important, and about which the president was deceptive.
First, the majority of our defense spending is devoted to the war in Iraq. Dick Cheney’s palaver notwithstanding, Iraqis did not “actually attack our homeland.”
Second, if Bush wants to look at defense spending in a historical context, I’m delighted: “[T]oday’s defense spending is 14% above the height of the Korean War, 33% above the height of the Vietnam War, 25% above the height of the ‘Reagan Era’ buildup and is 76% above the Cold War average. In fact, since the September 11, 2001 attacks, the annual defense budget — not including the costs of military operations in Iraq and Afghanistan — has gone up 34%. Including war costs, defense spending has gone up 86% since 2001.”
And third, the president referenced previous presidents and military eras without noting a key detail: before Bush, no president ever cut taxes during a war. Lincoln raised taxes to pay for the Civil War. McKinley raised taxes to finance the Spanish-American War. Wilson raised the top income tax rate to 77% to afford WWI. Taxes were raised, multiple times, to help the nation pay for WWII, Korea, and Vietnam. Even the first President Bush raised taxes after the first war with Iraq to, you guessed it, keep the deficit from spiraling out of control.
Why is this important? Because Bush isn’t just spending extraordinary sums on a disastrous war, he’s doing so in the most fiscally insane way possible — by becoming the first president to ever put a military conflict on the nation’s charge card, handing the bill to future generations.
With this in mind, Bush spoke this morning as if current defense spending was modest and inconsequential. This is sheer nonsense.
The Decider speaking nonsense? . . . The real tragedy is that he listens exclusively to nonsense before he makes decisions. . . But, that does sort of explain the quality of his decisions.
Did he do a little soft shoe while he spoke? i think he did….
His whole presidency has been sheer nonsense.
The following need to be brought before a war crimes tribunal immediately:
Ashcroft, Tenet, Rumsfeld, Powell, Rice, Cheney, and Bush.
You could add a few more but these are the folks who brought you the “War on Terror.”
There are substantially sound arguments to be made that never before in our history have the opportunity costs of war been as high as they are at this critical juncture. Accounting will never measure the degree of harm that this has done to the future of the US and the entire planet.
Boy George II is implying we are spending that money to defend the homeland when in fact we are spending it to defend Exxon’s claim to Iraq’s oil.
Going after Osama bin Laden would be a lot cheaper than trying to protect our fantasy oil concessions in Iraq.
Al Queda vs. USSR.
When it comes to presidential challenges, we’re obviously grading on a curve.
Bush keeps referencing the defense budget in his comments, but the Iraq war has been funded in large part by supplementals that are not part of the budget. I suspect that rhetorical slight of hand is part of his overall smoke and mirrors package.
Petorado beat me to it… isn’t most of the Iraq funding off-budget? Bush is lying once again.
Are the special appropriations for Iraq spending included in expenditures Bush is citing, or is he merely referencing money that’s in the budget proper?
My guess is the special appropriations are not included.
In which case hundreds of billions of extra dollars can be added to the total.
Ooops.
Petrado beat me to it, too.
Even if Bush’s argument made sense from a financial point of view, it is so incredibly stupid. Since Al Qaeda’s stated purpose is to destroy our economy, this sounds a lot like “bring ’em on.” As Sunni militias threaten to desert and refuse to fight Al Qaeda because we’ve stopped paying them $10/day, it’s offensive. Since we pay so much for shoddy work from defense contractors and have so much money unaccounted for, he might as well have said, “pocket change”. In light of his insistence on saving money by vetoing SCHIP, this percentage of GDP nonsense is truly offensive.
But then, Bush always sounds like he’s talking to a prozac-free third grade class.
petorado, Hannah, bee thousand – I see you’re all members of the ‘Great Minds’ coalition.
Like many of you, I was indeed skeptical about the horrendous bill we seemed to racking up for the war on terror. And, like many of you, I blamed the current administration. But President Bush’s comments today have convinced me that the War in Iraq is a good idea after all.
It’s all so clear now. The numbers he said today sounded lower than the other numbers he said. I was pleasantlyu surprised by this. Weren’t you?
I can draw but one conclusion: This is the cheapest war we’ve ever fought. And, just as we must always buy a pair of shoes or box of ammunition when it’s on sale, so must we rededicate ourselves to buying — and winning! — the War in Iraq.
I’m sold, Mr. Bush! Bring it on!
Raising taxes to pay for the war would have prevented the war. Hence the dishonest accounting before the war. Same goes for the troop requirements.
This war was predicated on deception, and would never have been approved if the Bushies had been honest about the costs, much less the actual aims of the war (ask Greenspan, he knows what it was about: OIL)
I’m going to climb way out on a limb and guess that Bush isn’t including a lot of the true costs of the war in his estimates. Long-term veteran health care, equipment replacement, ongoing base costs, and the interest on the debt he racked up so his millionaire “base” could keep their tax cuts, etc etc.
Let’s see that included, and then go from there.
By the way, I was very disappointed by “Speaker” Pelosi and “Leader” Reid’s remarks after Bush’s speech. Both were off-track and spacy in their remarks, instead of being on-point, as they should have been. They had Jon Soltz and another anti-war veteran with them, and while both Soltz and the other guy were good, it would have been far better if Reid and Pelosi had been speaking alone, with laser precision against Bush.
Notice how Bush interconnects Iran and al Qaeda:
Got that? al Qaeda “could gain safe havens in Iraq” and at the same time Iran (which hates al Qaeda) “would work to fill the vacuum in Iraq”.
Too bad we don’t have a real media, this would be called out as BS and shown to be a carbon copy of the deceptions perpetrated about Iraq and al Qaeda in 2002 and 2003.
I guess when you consider the pallet-fulls of unaccountable cash “we” were dropping on Korea and Vietnam and Central America, Bush has a poin… Oh. Never mind.
What gripes me about misdirection and lying like that pointed out by petorado and his fan club is that in all the talk everybody continually repeats the number of soldiers that we have over there, and that we’ll have over there once the returns stop again in July. It’s all over the news today, that we’ll have 140,000 troops over there at the end of the summer. How about the 150,000+ mercenaries? Oh excuse me, “contractors.” Aren’t they also Americans in Iraq, who are wholy identified with the USA and considered with, if anything, more disdain by the Iraqis than our regular soldiers? And aren’t they costing us more than our own soldiers? Why are these people so invisible in all the discussion of the war? We’ve got two entire armies over there, and the second costs more and has less accountability than the other one, but for all the news media talks about it they might as well be ghosts. I’m sick of being lied to!
“This is still a large amount of money, but it is modest — a modest fraction of our nation’s wealth — and it pales when compared to the cost of another terrorist attack on our people.”
Is he crazy, or what? Assuming the invasion of Iraq has something to do with the war on terrorism, which it doesn’t, let’s compare apples and apples. The 9/11 attack cost $20 billion in property damage, and fewer than 3000 lives. Iraq has cost over half a trillion American taxpayer dollars, over 4000 American lives, and nearly 30,000 wounded. And 100,000 innocent Iraqi civilian lives, God knows how many injured, 4 million displaced from their homes, and a completely destroyed economy and infrastructure of inestimable value.
What the hell is Bush talking about? This is the most colossal waste of blood, treasure and opportunity in American history.
And we’re far less safe than we were on 9/12. Global terrorism is far worse than it was then.
Oh, and don’t forget international goodwill. Everybody hates us now.
The Three Trillion Dollar War
http://www.amazon.com/Three-Trillion-Dollar-War-Conflict/dp/0393067017
This sobering study by Nobel Prize winner Joseph E. Stiglitz and Harvard professor Linda J. Bilmes casts a spotlight on expense items that have been hidden from the U.S. taxpayer, including not only big-ticket items like replacing military equipment (being used up at six times the peacetime rate) but also the cost of caring for thousands of wounded veterans—for the rest of their lives. Shifting to a global focus, the authors investigate the cost in lives and economic damage within Iraq and the region. Finally, with the chilling precision of an actuary, the authors measure what the U.S. taxpayer’s money would have produced if instead it had been invested in the further growth of the U.S. economy. Written in language as simple as the details are disturbing, this book will forever change the way we think about the war.
This is still a large amount of money, but it is modest — a modest fraction of our nation’s wealth — and it pales when compared to the cost of
another terrorist attack on our peoplemillions of uninsured children missing out on preventative medicineAnd therein lies just one of zillions of possible examples of the stupidity of the Worst President Ever’s illogical defense of his war.
We borrowed huge sums for previous wars, but we borrowed the money, mostly, from ourselves, which meant that there were few untoward macroeconomic implications from paying it back.
We borrowed the Iraq War funding from Japan and China and from the Arab oil states.
This is a critical difference.
What? Is that Bush guy still running this show? Somebody wake me Obama brings some reality-based leadership back to the country.
before Bush, no president ever cut taxes during a war.
I’ve always thought the quickest way to end George Bush’s war would be to force him (and his Republican allies) to actually find a way to pay for it.
The Iraq supplemental showdown last year would have looked a lot different if the Democrats had tagged on a war tax to cover the bill.
Hark, 4000+ dead soldiers…but dont forget, when the total was around 3000, there were already 1000+ contractors killed as well, so Id say, at this point, we’re probably pushing close to 6000 total. But eh, whatever, right. No costs there, they volunteered. (sigh…) Cant believe these criminals are going to run the clock out on this and bamboozle the press the whole way through. So utterly depressing…
G2K: Cant believe these criminals are going to run the clock out on this and bamboozle the press the whole way through. So utterly depressing…
watching Hardball last night; mathews and cilozza and buchanan beating the war drums on attacking iran — i sat there in utter amazement at their glee and bravado to going forward with attacks against iran, and not one of them offered a downside (e.g. oil prices going absolutely thru the roof). utterly depressing indeed.
We’ve got to change the meme. As long as the occupation in Iraq is called a war, then those of us who want peace have an uphill battle. No matter how bloody wars are or can be, there is a noble or at least positive connotation to the word, with a definitive beginning and ending.
We need to start calling it for what it is: the Iraq Occupation. I think occupation has a negative connotation to it and an occupation is open-ended.
The U.S. won the Iraq war when we entered Baghdad and toppled Saddam’s regime. The U.S. now occupies Iraq, with no end in sight.
I think we need to hammer this point again and again. And correct those that refer to it as a war.
#27 — very good point.