Tag: cost of war

War costs money*

Posted on by patdaniel

*and it’s OUR money.

During the past month, Engaging Peace has offered a number of perspectives on the financial aspects of war.  Some highlights:

  • The true costs of war are difficult to determine because of the intricacies of federal budgeting and accounting, as well as the use of deficit spending
  • Some of the financial impacts of war will occur in the future, due to veterans’ benefits and social costs to families of returning service people
  • Aside from the direct costs, war has a generalized negative effect on the economy, as seen in fewer jobs, increased debt, diversion of money from health care, education, environment, and other domestic needs
  • War tax resistance is a method that some have used to protest the funding of war by tax dollars

Despite the challenges of determining the accurate costs of war, totals for the Iraq war alone are estimated to be as high as $4-6 trillion.

To learn more specifics about the costs to the U.S., check out the Costs of War project.  For perspective from the U.K., watch a video on the economic impact of Britain’s involvement in U.S.-led wars.

You might wonder who is paying the taxes that support the war machine. It’s ordinary people like you and me–and not the most wealthy or the corporations that often profit from war efforts.

As an outgrowth of the Occupy Wall Street movement, a number of groups across the U.S. are calling attention to inequities in our tax structure–specifically the low tax rates paid by the 1%. For example, in Boston, a Tax Day march and rally on April 17 will be based on the message “Corporations and the 1%: Pay your taxes! Fund our communities!” Minneapolis, San Francisco, and other communities have also focused attention on these disparities.

The world economy is hurting. The pocketbooks and bank accounts of ordinary citizens are hurting. We feel it especially during tax season in the midst of what feels like a never-ending recession.

How to ease the pain and start the money flowing again?  The answer is clear:  Stop the wars.

Pat Daniel, Ph.D., Managing Editor of Engaging Peace

$300 billion in social costs (Cost of war, Part 4)

Posted on by kathiemm

[The final post in the series by guest author Neta Crawford]

Now we come to the fourth reason our estimates for the dollar costs of these wars have been too low. Federal spending is not the entire cost of the Iraq war. There are several other huge categories of economic costs.

Targeting military spending
Targeting military spending; photo by Joe Mabel. Used under CC Attribution-Share Alike 3.0 Unported license. From Wikimedia Commons.

There will be at least $300 billion in social costs of these wars, much of it borne by the close family members of injured veterans.

There are the macro-economic effects of borrowing for war, namely increased interest. Further, there is the opportunity cost of military spending.

The two largest opportunity costs are the consequences of the deferred maintenance of U.S. infrastructure and the potential jobs created by other forms of federal spending.

We are constantly told that military spending creates jobs. Indeed, every $1 billion in military spending creates about 11,200 jobs. If there were tax cuts instead and people spent that money themselves, more than 15,000 jobs could be created.

Indeed, military spending produces fewer jobs compared with spending on housing or non-residential construction, health care, or education.

Americans have been told at least three times — in May 2003 when the mission was “accomplished”; in September 2010 when the “combat” phase was over, and in December 2011 — that the Iraq war was won and over. All that was left was promoting democratization and stability.

But is the war really over for either Iraqis or Americans? Iraq remains extremely violent. Thousands of U.S. State Department and private contractors will remain in Iraq for the indefinite future. As Catherine Lutz wrote recently in Foreign Policy, “5,500 security personnel join 4,500 ‘general life support’ contractors who will be working to provide food, health care, and aviation services to those employed in Iraq, and approximately 6,000 US federal employees from State and other agencies.”

The dollar costs of war, as Eisenhower said more than a half-century ago, means dreams deferred or lost for millions. A few years before that, George Orwell’s main character in 1984, Winston Smith, wrote, “All history was a palimpsest, scraped clean and reinscribed exactly as often as was necessary.”

The next step in a full picture of the Iraq war’s toll would be to account for the death, displacement, and economic devastation the war has caused in Iraq and the region.

Neta C. Crawford is a Professor of Political Science at Boston University and co-director of the Costs of War study (www.costsofwar.org).

Until the last soldiers come home (Cost of war, Part 3)

Posted on by kathiemm

[A continuing series by guest author Neta Crawford about why it so difficult to accurately assess the true costs of war.]

The third reason the official numbers are low is the tendency to focus on what has already been spent, forgetting future war-related obligations. But of course, paying for the wars will not end when the last soldiers come home.

Disabled veterans poster
Image in public domain

The two most expensive future costs for the federal budget are future interest on war spending, and the costs of veterans care (medical and disability payments). Economist Ryan Edwards estimates that interest payments on appropriations through this year for both wars will be about $1 trillion to 2020. It would be nice if the war related debt was paid by then.

But more expensive and difficult to predict are the costs of caring for the more than 2.2 million veterans of these wars over the next 40 years. Linda Bilmes estimates that the VA will spend between $600 billion but likely closer to $900 billion for the more than 1 million discharged through last year.  When all are home, the estimates and the costs will rise.

Why will the costs of veterans’ care be so high?  First, these veterans will need to draw more medical and disability care than veterans of previous wars because they face more and in many cases more complex injuries than the past. This is in part due to advances in trauma medicine.

In World War II, the ratio of injured to dead was 3 to 1; in Iraq the ratio is about 8 to 1. More than 600,000 veterans have already been treated at the VA and more than 600,000 have claimed disability.

As these veterans — dealing with an average of more than 5 medical conditions — age, their injures will often become more complex and expensive to treat.

If we add the past spending and estimates for future federal expenditures, the total for Iraq alone is between $2.7-3.3 trillion.  If we add the costs of Afghanistan, the total rises far higher.

Neta C. Crawford is a Professor of Political Science at Boston University and co-director of the Costs of War study www.costsofwar.org

“Give the military whatever they need and more” (Cost of war, Part 2)

Posted on by kathiemm

[Note from Kathie Malley-Morrison:  Today we continue the series by guest author Neta Crawford. Part 2 picks up on the question of why it so difficult to accurately assess the true costs of war.]

First, there is a tendency to focus on what has been appropriated by Congress specifically for the war, with the consequence that the larger costs of war in Iraq are either missed or downplayed.

Dollars and dollars and dollars
"Artwork" with 20 Dollar Bills by selbstfotografiert, used under Creative Commons Attribution-Share Alike Unported 3.0 license

Specifically, many tallies focus on Congressional appropriations to the Department of Defense for the Iraq war, most of which were authorized in special emergency or supplemental appropriation, not included in the regular Pentagon “base” budget appropriations.

Others rightly include war related appropriations to the Veterans Administration and the State Department and US Agency for International Development (AID).  One of the most sophisticated of these analyses, by Amy Belasco of the Congressional Research Service (CRS) totals appropriations to Pentagon, State/USAID and the VA at $806 billion from 2003-2011.

But overall Pentagon appropriations and spending increased over the war in large part due to the Congressional desire to give the military whatever they needed and more.

Winslow Wheeler, of the Center for Defense Information, estimates that the base budget increase attributable to both the Iraq and Afghanistan wars is more than $600 billion over the last 10 years (whether one counts in current or constant dollars, and that matters).

If Wheeler is right or even right by half, then the share of the increase in base appropriations to the Pentagon that can reasonably attributed to the Iraq war is between $190 billion and $380 billion.

The second reason the official estimates are low compared to what the war will actually cost is the tendency to forget how the Iraq war was financed — almost entirely by deficit spending.  If one calculates the interest on debt for just the Pentagon, State, and VA appropriations, using the amount appropriated according the CRS, for the Iraq war already paid, the total is about $117 billion.

Neta C. Crawford is a Professor of Political Science at Boston University and co-director of the Costs of War study www.costsofwar.org