Do We Live in the United States of Amnesia?
or
Why the Iraq War May Cost More Than $1 Trillion

January 7, 2006

Comment #545, Revised January 9, 2006



Attached references:

[Ref.1] Jamie Wilson, "Iraq war could cost US over $2 trillion, says Nobel prize-winning economist ," The Guardian, January 7, 2006

[Ref.2] Paul E. Schroeder, "A Life, Wasted: Let's Stop This War Before More Heroes Are Killed," Washington Post, January 3, 2006; Page A17

Cited reference:

"The Economic Costs of the Iraq War," by Linda Bilmes and Joseph E. Stiglitz, 309KB PDF on the Columbia University site.


Reference 1 is a report in The Guardian that discusses a new analysis of the life cycle cost of the Iraq war. It was written by Joseph Stiglitz, winner of the Nobel prize for economics in 2001, and Linda Bilmes of Harvard. Stiglitz and Bilmes estimate the war will eventually consume between one and two trillion dollars, or more than 10 times what the Bush Administration estimated after it became clear that its original prediction of "self financing" via Iraq's oil revenues was, like most free lunches, a pipe dream. This analysis will be posted on http://www.josephstiglitz.com/. A bio of Stiglitz can be found at http://www2.gsb.columbia.edu/faculty/jstiglitz/bio.cfm.

For many years, I have written about the constitutionally subversive effects of the "defense power games" (front loading & political engineering) as practised by the Military - Industrial - Congressional Complex or MICC. This writing has usually be in the context of weapons procurement, but it is now clear beyond a shadow of doubt that the Iraq War has become a case study of these games being waged by the Bush Administration and Congress. The corrosive moral effects of these games are now insinuating themselves into the body politic on a colossal scale.

For those readers who doubt this conclusion, consider please, the following questions:

I. Regarding the front loading power game (downplaying the future consequences of current decisions)

  • Was not the necessity for the preemptive invasion of Iraq grotesquely exaggerated? Remember, for example, the bogus claim of a clear and present danger posed by weapons of mass destruction and the implied threat of a nuclear-armed al Qaeda being forged by the links between Saddam and Osama.

  • Were not the benefits of removing Saddam grotesquely exaggerated? Remember, for example, the bogus predictions of being welcomed by the Iraqi people with flowers or how removal of Saddam would trigger a domino effect of spreading democracy throughout the Arab world, thereby transforming a regional state system into one at peace with and empathetic to the interests of the United States and Israel.

  • Were not the costs of the war grotesquely understated? Remember, for example, how Deputy Defense Secretary Paul Wolfowitz dissed General Shinseki for projecting large force requirements, or Wolfowitz's bizarre economic prediction that exploitation of Iraq's oil revenues would make the Iraq War self-financing, or the prediction made by Larry Lindsey, Bush's economic adviser, that Iraq's costs might reach $200bn. Bear in mind, Congress has already appropriated at least $250 billion, and as of now, there is no end in sight.

II. As for the political engineering power game (locking in Congress to a decision by quickly spreading commitments to that decision around congress, before its consequences become apparent), consider please these questions:

  • Did not Mr. Bush use the full power of the Presidency to stampede Congress in the immediate aftermath of Sept 11 into voting to give him a blanket war making authority which was tantamount to a formal abdication of the clear Constitutional requirement that only the Congress can declare war?

  • Did not their approval of this extra constitutional authority effectively lock those members of Congress into supporting the President's decision to invade Iraq, even though those members did not know they were committing to this when they were voting for that authority?

  • Does not that formal abdication still work to lock in that support, even though the requirements for and the supposed benefits of the invasion have evaporated, while its costs have skyrocketed?

  • Has not, for example, this locking-in phenomenon been self-evident after the fact? Remember the 2004 election campaign, where presidential candidate Senator Kerry and VP candidate Senator Edwards (who both voted for the abdication), as well as though mainstream democrats who voted for the abdication (like Senators Clinton and Biden), campaigned for or gave speeches in supporting of a vapid platform that described their opposition to Iraq as merely one of means not ends.

  • In effect, by arguing that the Democrats should be put in charge of the war because they could wage it more effectively than Bush and the Republicans), did the Democrats not reveal they were and are afraid to admit they had been snookered by a gigantic bait and switch operation (Congressman Murtha, to his credit, now excepted)?

  • Is not this locking phenomenon evident when Mr. Bush justifies "staying the course" by asserting that leaving Iraq would dishonor the sacrifices of those Americans who already sacrificed their lives and limbs in this war? Bear in mind, he and his minions went out of their way to downplay the sacrifices of others before the sacrifices came due when, for example, under the pain of repetition, he allowed his minions to claim American troops would be welcomed with flowers and he allowed them to diss Army Chief of Staff General Shinseki for claiming much larger forces would needed to pacify Iraq.

While economists would dismiss Bush's "stay the course" logic as logically absurd, because it is based on sunk costs not future costs, the sunk cost argument exerts a powerful psychological appeal for those invested in a decision and those incurring losses. It is reflected, for example, in the addicted gambler's belief that a recurring decision to stay the course in a losing game of chance because of an irrational faith that future winnings must exceed the losses already incurred. And like the the mind of the addicted gambler, the mind of a practitioner of war (which is struggling to achieve a goal in the presence of resistance, menace, and uncertainty) is far more dependent on psychology and moral values than the clinical rationalism of theoretical economics. In fact, the "logic" of redeeming failure by spilling more blood to justify that already spilt is one of the oldest themes in war. And its use is most revealing of the moral quality of leadership, particularly if that leadership is not partaking in those losses.

[Casualty data revised 1/9/06] General Sir Douglas Haig, the mediocre commander of the British Expeditionary Force (BEF) in the WWI's Battle of the Somme, is perhaps history's greatest practitioner of this mad logic. Under his leadership, the British army suffered 60,000 casualties, including 19,000 killed, on the first day of the battle, July 1, 1916 (and this was after a stupendous 7-day bombardment to soften of the German lines which he predicted would pulverize German resistance). But this initial "setback" did not deter Haig, who was determined to "stay the course." Isolated from the carnage in a comfortable chateau far behind the battle lines, Haig's iron determination over the next four and one half months produced a months long Battle of the Somme, which eventually petered out on Nov 13 1916, with no decision. By then, Haig's determination to redeem failure, no matter what the future cost, had accumulated an actual cost of 500,000 to 600,000 British casualties (depending on whether diversionary attacks are counted), 204,000 French casualties, and 230,000 German casualties.  The allies, in other words, not only gained nothing of value, but suffered three times the casualties of the Germans.  What did Haig lose? He remained as commander of the BEF until the end of the war in 1918, and he was rewarded repeatedly in its aftermath: promoted to Commander in Chief of Home Forces in 1919, made an Earl in 1919, a Baron in 1921, and awarded a huge tax free golden handshake of 100,000, which would have made the scion of the Haig & Haig distillery fortune a multimillionaire in his own right when expressed in today's currency.

So, the "stay the course" argument is emotively powerful albeit illogical and monstrously dangerous when, unlike the gambler of his own money, the individual making a decision is not suffering from the consequences of that decision. But there remains the moral question: do we honor the dead, as Mr. Bush's argues, by spilling more blood in the hope of redeeming his faltering front loaded, politically engineered agenda for aggressive war? With this question in mind, I now urge you to read Paul Schroeder's, eloquent rebuttal in Reference 2 below and decide for yourself.

Perhaps, as Gore Vidal opines, we live in the United States of Amnesia, because to ask these questions is to answer them and perhaps we don't want to hear those answers, because to reflect on them is to reflect on a Republic that is losing its constitutional bearings and is slipping ever more rapidly into a authoritarian quagmire that is being becoming ever more entangled by an elite political class of Republicans and Democrats addicted to tricking the people in a morally corrosive political game of bait and switch.


Chuck Spinney

"A popular government without popular information, or the means of acquiring it, is but a prologue to a farce or a tragedy, or perhaps both. Knowledge will forever govern ignorance, and a people who mean to be their own governors must arm themselves with the power which knowledge gives." - James Madison, from a letter to W.T. Barry, August 4, 1822

[Disclaimer: In accordance with 17 U.S.C. 107, this material is distributed without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only.]


Reference 1

Iraq war could cost US over $2 trillion, says Nobel prize-winning economist

  • Economists say official estimates are far too low

  • New calculation takes in dead and injured soldiers

Jamie Wilson in Washington
The Guardian
Saturday January 7, 2006
http://www.guardian.co.uk/Iraq/Story/0,2763,1681119,00.html?gusrc=rss

The real cost to the US of the Iraq war is likely to be between $1 trillion and $2 trillion (1.1 trillion), up to 10 times more than previously thought, according to a report written by a Nobel prize-winning economist and a Harvard budget expert.

The study, which expanded on traditional estimates by including such costs as lifetime disability and healthcare for troops injured in the conflict as well as the impact on the American economy, concluded that the US government is continuing to underestimate the cost of the war.

The paper on the real cost of the war, written by Joseph Stiglitz, a Columbia University professor who won the Nobel prize for economics in 2001, and Linda Bilmes, a Harvard budget expert, is likely to add to the pressure on the White House on the war. It also followed the revelation this week that the White House had scaled back ambitions to rebuild Iraq and did not intend to seek funds for reconstruction.

In 2003, as US and British troops were massing on the Iraq border, Larry Lindsey, George Bush's economic adviser, suggested the costs might reach $200bn. The White House said the figure was far too high, and the deputy defence secretary, Paul Wolfowitz, said Iraq could finance its own reconstruction.

The unforeseen costs of the war have been blamed on poor planning and vision by the architects of the invasion. In a frank admission yesterday, Paul Bremer, the first US administrator of postwar Iraq, said the Americans did not anticipate the uprising that has persisted since flaring in 2004. "We really didn't see the insurgency coming," he told NBC television

Mr Stiglitz, a former World Bank chief economist, said the paper, which will be available on josephstiglitz.com, did not attempt to explain whether Americans were deliberately misled or whether the underestimate was due to incompetence.

Reference 2

A Life, Wasted
Let's Stop This War Before More Heroes Are Killed

By Paul E. Schroeder
Washington Post
Tuesday, January 3, 2006; Page A17
http://www.washingtonpost.com/wp-dyn/content/article/2006/01/02/AR2006010200974.html

But when heard repeatedly, the phrases "he died a hero" or "he died a patriot" or "he died for his country" rub raw.

"People think that if they say that, somehow it makes it okay that he died," our daughter, Amanda, has said. "He was a hero before he died, not just because he went to Iraq. I was proud of him before, and being a patriot doesn't make his death okay. I'm glad he got so much respect at his funeral, but that didn't make it okay either."

I am outraged at what I see as the cause of his death. For nearly three years, the Bush administration has pursued a policy that makes our troops sitting ducks. While Secretary of State Condoleezza Rice told the Senate Foreign Relations Committee that our policy is to "clear, hold and build" Iraqi towns, there aren't enough troops to do that.

In our last conversation, Augie complained that the cost in lives to clear insurgents was "less and less worth it," because Marines have to keep coming back to clear the same places.

I choose to honor our fallen hero by remembering who he was in life, not how he died. A picture of a smiling Augie in Iraq, sunglasses turned upside down, shows his essence a joyous kid who could use any prop to make others feel the same way.

But their deaths will not be in vain if Americans stop hiding behind flag-draped hero masks and stop whispering their opposition to this war. Until then, the lives of other sons, daughters, husbands, wives, fathers and mothers may be wasted as well.

The writer is managing director of a trade development firm in Cleveland.

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