Drs. Joseph E. Stiglitz and Linda Bilmes presented a new analysis of the cost of the Iraq war on Sunday at the American Economic Association meeting in Boston. Their analysis shows the total costs will probably exceeds $2 Trillion.
The Boston Globe reports:
The cost of the Iraq war could top $2 trillion after factoring in long-term healthcare for wounded US veterans, rebuilding a worn-down military, and accounting for other unforeseen bills and economic losses, according to a new analysis …
The figure is more than four times what the war was expected to cost through 2006 — around $500 billion, according to congressional budget data.
Stiglitz and Bilmes included many long term macroeconomic impacts to arrive at the $2 Trillion figure, but even the direct costs are staggering:
“There are 16,000 people with serious injuries,” Stiglitz said. “That number is predicted to double [by 2010], and every injured person has health costs, plus disability. That is an obvious but important example that represents costs in Iraq not reflected” in the official numbers,
Those costs bring the price tag of the war up to about $650 billion, Stiglitz said, but that doesn’t include broader economic factors such as the war’s drag on the federal deficit.
And Stiglitz thinks the final number might be much worse:
“There are quite a few things that are not being captured in the budgetary numbers” presented by the government, said Stiglitz, who received the Nobel Prize in Economics in 2001. “When you add up all of those numbers, it increases substantially. I think $2 trillion is conservative.”
I haven’t read the analysis yet, but I’ve wondered how we account for the loss of good will and the tarnished American brand. And what if a real threat emerges – will America have called wolf one time too often?
Happy New Year to all. CR Calculated Risk