LadyMod at scam.com
12-02-2007, 08:21 AM
And what did we get for our $50,000 per US family? Here, pick one. Did we get:
A better world? Fewer terrorists? Happier Iraqis? Happier Americans? A strong US military? A stronger US economy? A world that respects the US more?
A freer America? A strengthened US Constitution? Better care for our Vets? A more peaceful Middle East? Lower oil prices? A more secure energy future?
IF this is how the Neocons exist, on borrowed money and up to their eyeballs in debt, it's no wonder this war is popular to them.
War At Any Price? (http://www.mindfully.org/Reform/2007/Iraq-War-Costs-JEC13nov07.htm)
The Total Economic Costs of the War Beyond the Federal Budget
A Report by the Joint Economic Committee
Majority Staff Chairman, Senator Charles E. Schumer,
Vice Chair, Rep. Carolyn B. Maloney
Nov. 17, 2007
Executive Summary
The long wars in Iraq and Afghanistan have cost the United States in many ways. For the American Armed Forces, the human toll has been profound: as of November 9, 2007, 4,578 American soldiers have lost their lives, and 30,205 have been wounded, many of them gravely. The damage to our international reputation at a time when the United States faces grave security challenges all over the world has also been severe. And the full economic costs of the war to the American taxpayers and the overall U.S. economy go well beyond even the immense federal budget costs already reported. These “hidden costs” of the Iraq war include the ongoing drain on U.S. economic growth created by Iraq-related borrowing, the disruptive effects of the conflict on world oil markets, the future care of our injured veterans, repair costs for the military, and other undisclosed costs.
In this report, the Joint Economic Committee estimates the total costs of the long war in Iraq to the American economy as a whole:
• The total economic costs of the wars in Iraq and Afghanistan so far have been approximately double the total amounts directly requested by the Administration to fight these wars.
• The future economic costs of a prolonged military presence in Iraq would be massive. Even assuming a considerable drawdown in troop levels, total economic costs of the wars in Iraq and Afghanistan (with the vast majority of costs a result of in the war Iraq) would amount to $3.5 trillion between 2003 and 2017. This is over $1 trillion higher than the recent Congressional Budget Office (CBO) Federal cost forecast for the same scenario, which counted only direct spending and interest paid on war-related debt resulting from that spending.
• The total economic cost of the war in Iraq to a family of four is a shocking $16,500 from 2002 to 2008. When the war in Afghanistan is included, the burden to the American family rises to $20,900. The future impact on a family of four skyrockets to $36,900 for Iraq and $46,400 for Iraq and Afghanistan when all potential costs from 2002 to 2017 are included. The American people and Democrats in Congress have urged a dramatic change of course in Iraq. This war has cost Americans far too much, in terms of lives, dollars, and our reputation around the world. This report also demonstrates that a change in course would bring substantial economic savings to our country.
Through 2008, the True Cost of the War has been Double the Administration’s Budgeted Cost
To date, the President has requested a total of $607 billion for the Iraq war alone since 2003. This is over ten times higher than the $50 to $60 billion cost estimated by the Administration prior to the start of the war. Costs have increased every year since the start of the war in 2003. The Administration has requested $804 billion for the Iraq and Afghanistan wars combined (CRS 2007, Bumiller 2003).1
To provide some perspective on these figures, just the funds requested for the Iraq war through 2008 would have been sufficient to provide health insurance coverage to all of America’s uninsured for the 2003-2008 period. (There were approximately 45 million uninsured Americans at the start of the war in 2003 and this number rose to 47 million by 2006, which is the latest figure available from the U.S. Census Bureau).
But even beyond these direct fiscal impacts, there are a large number of costs that do not appear directly in Administration funding requests for the Iraq war. The most important of these include the following:
• Borrowed money to finance the Iraq War has displaced productive investment. Since taxes have been cut and other spending has increased since the beginning of the Iraq war, it seems clear that the war has been and continues to be funded using borrowed money. The increase in government borrowing displaces substantial amounts of productive investment by U.S. businesses, thus reducing productivity in the economy over many future years. Interest costs paid by taxpayers are only a subset of these costs.
• Substantial Iraq-related costs have been borrowed from foreigners. The interest payments on this debt constitute a flow of funds from Americans to those foreigners who have bought our debt.
• The war in Iraq has disrupted world oil markets leading to increased prices. The Iraq war has occurred in a context of greatly increasing world demand for oil, as well as declining excess production capacity. Both the direct effect of the war in reducing Iraqi oil production and the indirect effect of creating greater instability in the Middle East can act to increase oil prices. Relatively small increases in oil prices can have substantial economic effects.
• Other economic and budgetary costs have grown due to the Iraq war. These expenditures include the costs of treating the wounded and disabled, lost productivity from those injured, potential future expansions in the size of the military made necessary by the war, the costs of repair and refit for military equipment, increases in recruitment and retention costs for the military, and economic disruptions created by the deployment of the Reserves.
The sum of the costs listed above raises the economic costs of the war from $607 billion in direct funding for the Iraq war to $1.3 trillion. If spending in Afghanistan is included, costs could reach $1.6 trillion by the close of FY 2008.
There are numerous other impacts of these wars that are not listed above and are difficult if not impossible to measure. These include the horrible human cost of the nearly 4,000 U.S. fatalities since the start of military operations in Iraq, the impact on our reputation and credibility throughout the world, and the budgetary and economic costs to other nations besides the U.S. (most notably Iraq). Finally, the debate over the broader national security impacts of the Iraq war, and related costs or benefits, is a complex issue that goes beyond the scope of this report (DoD 2007).
If We Don’t Change Course, the Cost of the War will Balloon to $3.5 Trillion
The costs described above represent only the impacts of the Iraq war through the close of FY 2008 (if the President’s current budget requests are approved in full). Yet at least some spending on the war will continue beyond FY 2008. Assumptions about the future course of the war are necessary to forecast the full eventual fiscal and economic impacts. Because the Administration has not been clear about future plans for U.S. forces in Iraq, these assumptions must be hypothetical.
This study mainly examines potential future costs over a ten year window, up to the year 2017, similar to the budget spending window that the CBO used. The paper focuses on a scenario corresponding to the recent statement by Secretary of Defense Robert Gates that a protracted “Korealike” presence would be required in Iraq. This scenario involves a drawdown in Iraq troop levels of 66 percent by the year 2013, and a smaller drawdown of 33 percent in Afghanistan forces. The scenario also assumes that some active conflict with insurgents continues over the period (CBO 2007a).
In recent testimony, the nonpartisan CBO detailed Federal direct appropriations and interest costs for this scenario (CBO 2007b). These CBO estimates are used as a base for the analysis in this report. Once the full economic costs of the war are added to the approximately $2.4 trillion in Federal spending forecast under the CBO scenario, the total economic cost of the wars in Iraq and Afghanistan rise by over $1 trillion to $3.5 trillion.
Costs could far exceed these projections if the significant drawdown assumed in this scenario does not materialize. This CBO budgetary scenario projects that appropriations for the Iraq war will begin to drop significantly in 2009. But historically appropriations for the Iraq war have increased every year since the invasion, by between 12 and 40 percent annually (CRS 2007).
This report also presents costs for several alternative budgetary scenarios (Appendix A). These include costs for a rapid withdrawal from Iraq while maintaining troops in Afghanistan, and the costs to maintain current (post-surge) troop levels in Iraq for the next decade. These scenarios generate very different economic costs over the next decade. For example, maintaining post-surge troop levels in Iraq over the next ten years would result in costs of $4.5 trillion.
Each state is assumed to bear a share of the total war costs proportional to its share of the total national economy. On this basis, the report presents total state costs accrued through FY 2008, as well as potential future costs through 2017.
Part I: Taxpayer Costs of the War
This section estimates current and future taxpayer expenditures for the war, based on budgetary information from the Congressional Research Service (CRS) and Congressional Budget Office (CBO).
2 The taxpayer costs can be divided into direct appropriations for the war and interest costs for Iraq-related debt. (These interest costs are a subset of the wider economic costs calculated in this report).
DIRECT APPROPRIATIONS FOR THE WAR
Prior to the start of the Iraq war in 2003, the Bush administration estimated the total cost of the war at between $50 to $60 billion (Bumiller 2003).
The President has now requested over ten times this initial estimate just in direct appropriations for the war between FY 2003 and 2008. If the President’s latest request for supplemental funding is approved, the direct expenditures authorized specifically for the Iraq war from FY 2003 to FY 2008 will total some $607 billion (CRS 2007; JEC estimates). This includes $450 billion already authorized by Congress between FY 2003 and FY 2007, plus an estimated $158 billion for Iraq from the supplemental request that the administration has made for FY 2008.3
Estimates of budgetary costs after 2008 depend on assumptions about the future course of the war. Appendix A of this report outlines costs for a variety of alternative scenarios, ranging from a rapid drawdown of troops to a continuation of post-surge funding and troop levels through the foreseeable future.
In the main body of this report, we focus on the CBO “considerable drawdown” scenario, which corresponds to the “Korea-like presence” recently predicted by Secretary of Defense Robert Gates. Following the war in Korea, force levels dropped to a level of between 50,000 and 60,000 troops throughout the 1960s and 1970s (Kane 2004). This scenario assumes that force levels in Iraq drop from their current level of 180,000 troops down to 55,000 by 2013, and are maintained at this level through 2017.
This level of drawdown implies that beginning in FY 2009 funding levels for Iraq will begin to drop for the first time in the history of the war. The scenario predicts direct appropriations for the war drop from $135 billion in FY 2007 to less than $60 billion in FY 2013. For these reasons, the scenario should be seen as a conservative one. This CBO scenario implies an additional $690 billion in Iraq war spending through 2017 (CBO 2007a).
MORE (http://www.mindfully.org/Reform/2007/Iraq-War-Costs-JEC13nov07.htm)
.
A better world? Fewer terrorists? Happier Iraqis? Happier Americans? A strong US military? A stronger US economy? A world that respects the US more?
A freer America? A strengthened US Constitution? Better care for our Vets? A more peaceful Middle East? Lower oil prices? A more secure energy future?
IF this is how the Neocons exist, on borrowed money and up to their eyeballs in debt, it's no wonder this war is popular to them.
War At Any Price? (http://www.mindfully.org/Reform/2007/Iraq-War-Costs-JEC13nov07.htm)
The Total Economic Costs of the War Beyond the Federal Budget
A Report by the Joint Economic Committee
Majority Staff Chairman, Senator Charles E. Schumer,
Vice Chair, Rep. Carolyn B. Maloney
Nov. 17, 2007
Executive Summary
The long wars in Iraq and Afghanistan have cost the United States in many ways. For the American Armed Forces, the human toll has been profound: as of November 9, 2007, 4,578 American soldiers have lost their lives, and 30,205 have been wounded, many of them gravely. The damage to our international reputation at a time when the United States faces grave security challenges all over the world has also been severe. And the full economic costs of the war to the American taxpayers and the overall U.S. economy go well beyond even the immense federal budget costs already reported. These “hidden costs” of the Iraq war include the ongoing drain on U.S. economic growth created by Iraq-related borrowing, the disruptive effects of the conflict on world oil markets, the future care of our injured veterans, repair costs for the military, and other undisclosed costs.
In this report, the Joint Economic Committee estimates the total costs of the long war in Iraq to the American economy as a whole:
• The total economic costs of the wars in Iraq and Afghanistan so far have been approximately double the total amounts directly requested by the Administration to fight these wars.
• The future economic costs of a prolonged military presence in Iraq would be massive. Even assuming a considerable drawdown in troop levels, total economic costs of the wars in Iraq and Afghanistan (with the vast majority of costs a result of in the war Iraq) would amount to $3.5 trillion between 2003 and 2017. This is over $1 trillion higher than the recent Congressional Budget Office (CBO) Federal cost forecast for the same scenario, which counted only direct spending and interest paid on war-related debt resulting from that spending.
• The total economic cost of the war in Iraq to a family of four is a shocking $16,500 from 2002 to 2008. When the war in Afghanistan is included, the burden to the American family rises to $20,900. The future impact on a family of four skyrockets to $36,900 for Iraq and $46,400 for Iraq and Afghanistan when all potential costs from 2002 to 2017 are included. The American people and Democrats in Congress have urged a dramatic change of course in Iraq. This war has cost Americans far too much, in terms of lives, dollars, and our reputation around the world. This report also demonstrates that a change in course would bring substantial economic savings to our country.
Through 2008, the True Cost of the War has been Double the Administration’s Budgeted Cost
To date, the President has requested a total of $607 billion for the Iraq war alone since 2003. This is over ten times higher than the $50 to $60 billion cost estimated by the Administration prior to the start of the war. Costs have increased every year since the start of the war in 2003. The Administration has requested $804 billion for the Iraq and Afghanistan wars combined (CRS 2007, Bumiller 2003).1
To provide some perspective on these figures, just the funds requested for the Iraq war through 2008 would have been sufficient to provide health insurance coverage to all of America’s uninsured for the 2003-2008 period. (There were approximately 45 million uninsured Americans at the start of the war in 2003 and this number rose to 47 million by 2006, which is the latest figure available from the U.S. Census Bureau).
But even beyond these direct fiscal impacts, there are a large number of costs that do not appear directly in Administration funding requests for the Iraq war. The most important of these include the following:
• Borrowed money to finance the Iraq War has displaced productive investment. Since taxes have been cut and other spending has increased since the beginning of the Iraq war, it seems clear that the war has been and continues to be funded using borrowed money. The increase in government borrowing displaces substantial amounts of productive investment by U.S. businesses, thus reducing productivity in the economy over many future years. Interest costs paid by taxpayers are only a subset of these costs.
• Substantial Iraq-related costs have been borrowed from foreigners. The interest payments on this debt constitute a flow of funds from Americans to those foreigners who have bought our debt.
• The war in Iraq has disrupted world oil markets leading to increased prices. The Iraq war has occurred in a context of greatly increasing world demand for oil, as well as declining excess production capacity. Both the direct effect of the war in reducing Iraqi oil production and the indirect effect of creating greater instability in the Middle East can act to increase oil prices. Relatively small increases in oil prices can have substantial economic effects.
• Other economic and budgetary costs have grown due to the Iraq war. These expenditures include the costs of treating the wounded and disabled, lost productivity from those injured, potential future expansions in the size of the military made necessary by the war, the costs of repair and refit for military equipment, increases in recruitment and retention costs for the military, and economic disruptions created by the deployment of the Reserves.
The sum of the costs listed above raises the economic costs of the war from $607 billion in direct funding for the Iraq war to $1.3 trillion. If spending in Afghanistan is included, costs could reach $1.6 trillion by the close of FY 2008.
There are numerous other impacts of these wars that are not listed above and are difficult if not impossible to measure. These include the horrible human cost of the nearly 4,000 U.S. fatalities since the start of military operations in Iraq, the impact on our reputation and credibility throughout the world, and the budgetary and economic costs to other nations besides the U.S. (most notably Iraq). Finally, the debate over the broader national security impacts of the Iraq war, and related costs or benefits, is a complex issue that goes beyond the scope of this report (DoD 2007).
If We Don’t Change Course, the Cost of the War will Balloon to $3.5 Trillion
The costs described above represent only the impacts of the Iraq war through the close of FY 2008 (if the President’s current budget requests are approved in full). Yet at least some spending on the war will continue beyond FY 2008. Assumptions about the future course of the war are necessary to forecast the full eventual fiscal and economic impacts. Because the Administration has not been clear about future plans for U.S. forces in Iraq, these assumptions must be hypothetical.
This study mainly examines potential future costs over a ten year window, up to the year 2017, similar to the budget spending window that the CBO used. The paper focuses on a scenario corresponding to the recent statement by Secretary of Defense Robert Gates that a protracted “Korealike” presence would be required in Iraq. This scenario involves a drawdown in Iraq troop levels of 66 percent by the year 2013, and a smaller drawdown of 33 percent in Afghanistan forces. The scenario also assumes that some active conflict with insurgents continues over the period (CBO 2007a).
In recent testimony, the nonpartisan CBO detailed Federal direct appropriations and interest costs for this scenario (CBO 2007b). These CBO estimates are used as a base for the analysis in this report. Once the full economic costs of the war are added to the approximately $2.4 trillion in Federal spending forecast under the CBO scenario, the total economic cost of the wars in Iraq and Afghanistan rise by over $1 trillion to $3.5 trillion.
Costs could far exceed these projections if the significant drawdown assumed in this scenario does not materialize. This CBO budgetary scenario projects that appropriations for the Iraq war will begin to drop significantly in 2009. But historically appropriations for the Iraq war have increased every year since the invasion, by between 12 and 40 percent annually (CRS 2007).
This report also presents costs for several alternative budgetary scenarios (Appendix A). These include costs for a rapid withdrawal from Iraq while maintaining troops in Afghanistan, and the costs to maintain current (post-surge) troop levels in Iraq for the next decade. These scenarios generate very different economic costs over the next decade. For example, maintaining post-surge troop levels in Iraq over the next ten years would result in costs of $4.5 trillion.
Each state is assumed to bear a share of the total war costs proportional to its share of the total national economy. On this basis, the report presents total state costs accrued through FY 2008, as well as potential future costs through 2017.
Part I: Taxpayer Costs of the War
This section estimates current and future taxpayer expenditures for the war, based on budgetary information from the Congressional Research Service (CRS) and Congressional Budget Office (CBO).
2 The taxpayer costs can be divided into direct appropriations for the war and interest costs for Iraq-related debt. (These interest costs are a subset of the wider economic costs calculated in this report).
DIRECT APPROPRIATIONS FOR THE WAR
Prior to the start of the Iraq war in 2003, the Bush administration estimated the total cost of the war at between $50 to $60 billion (Bumiller 2003).
The President has now requested over ten times this initial estimate just in direct appropriations for the war between FY 2003 and 2008. If the President’s latest request for supplemental funding is approved, the direct expenditures authorized specifically for the Iraq war from FY 2003 to FY 2008 will total some $607 billion (CRS 2007; JEC estimates). This includes $450 billion already authorized by Congress between FY 2003 and FY 2007, plus an estimated $158 billion for Iraq from the supplemental request that the administration has made for FY 2008.3
Estimates of budgetary costs after 2008 depend on assumptions about the future course of the war. Appendix A of this report outlines costs for a variety of alternative scenarios, ranging from a rapid drawdown of troops to a continuation of post-surge funding and troop levels through the foreseeable future.
In the main body of this report, we focus on the CBO “considerable drawdown” scenario, which corresponds to the “Korea-like presence” recently predicted by Secretary of Defense Robert Gates. Following the war in Korea, force levels dropped to a level of between 50,000 and 60,000 troops throughout the 1960s and 1970s (Kane 2004). This scenario assumes that force levels in Iraq drop from their current level of 180,000 troops down to 55,000 by 2013, and are maintained at this level through 2017.
This level of drawdown implies that beginning in FY 2009 funding levels for Iraq will begin to drop for the first time in the history of the war. The scenario predicts direct appropriations for the war drop from $135 billion in FY 2007 to less than $60 billion in FY 2013. For these reasons, the scenario should be seen as a conservative one. This CBO scenario implies an additional $690 billion in Iraq war spending through 2017 (CBO 2007a).
MORE (http://www.mindfully.org/Reform/2007/Iraq-War-Costs-JEC13nov07.htm)
.