When I wrote this post last month, I thought my little ballpark guess about the true cost of our Iraq adventure might be a bit on the high side:
The "conservative" (pun intended) 5-year forecast ... would be:$3 billion per month x 12 months = $36 billion
$36 billion x 5 years = $180 billionAnd that's just to pay for the troops. Since it appears Iraq's oil revenues won't even cover the country's basic needs, and since Proconsul Bremer already has promised to steer at least some of those revenues directly to the Iraqi people in the form of dividend checks -- a la Alaska's Permanent Fund -- we probably should add something to the U.S. tab for Iraq's reconstruction. So let's call it an even $5 billion a month, which equals $60 billion a year, which equals $300 billion over five years.
But now, if anything, it looks like that may have been too low:
War's Cost Brings Democratic Anger
(Oooooh those pesky Dems, always worrying about the taxpayers' hard-earned dollars. Why can't they learn to relax and look at the big picture -- like the Republicans?)
The Pentagon's new estimate that military costs for Iraq would average $3.9 billion monthly for the first nine months of this year produced surprise and anger today among Congressional Democrats, who said the amount was not only more than they had been told, but far too large given the budget deficit.
Let's see, in April the Pentagon estimated the occupation would cost $2 billion a month. By early June, the pricetag had risen to $3 billion a month. Now it's almost $4 billion -- a 50% increase in less than three months. That's pretty good, even for government work. And, as the Times points out, there may be other unexpected costs coming down the pike:
Administration officials disclosed, meanwhile, that the cost of running the civilian parts of the stabilization and reconstruction of Iraq also are increasing, and that the roughly $7 billion available to pay for much of these costs is expected to run out near the end of the year . . .Officials involved in financing the nonmilitary part of the stabilization effort say that once Iraq's oil industry is restored sometime next year, it may produce two million to three million barrels of oil a day, yielding $15 billion to $20 billion in annual revenue.
But sabotage and troubles repairing the oil fields make that goal uncertain ...
Hmmm, looks like those Alaska-style dividend checks may not be landing in Iraqi pockets after all. In fact, before this mess is finished, we may to invade Saudi Arabia to get the oil to pay for our Iraq occupation ...
Uh, just kidding. Rummy? Wolfy? You hear me? It was a JOKE.
I shouldn't be giving them ideas.
Anyway, call it another example of that great Pentagon planning that Doug Feith was bragging about the other day:
Mr. Zakheim, the Pentagon comptroller, said the Defense Department's prewar budget planning was based on the assumption that the conflict might last three to six weeks, followed by six months of stabilization and transition. Approximately $13 billion was set aside for that, he said, which produced his rough estimate in April of $2.1 billion to $2.2 billion in monthly war expenses.By the time he went to Capitol Hill in June to testify on war costs, [Pentagon comptroller Dov] Zakheim said: "I already knew the numbers were rising. Sure enough, when you looked at the actual costs from January to the end of April, that number was about $4.1 billion per month."
Sure enough. But, of course, the administration has a stock answer for this sort of thing, which is, roughly: How were we supposed to know?
Zakheim said the unknown course of postwar stabilization in Iraq, and the uncertainties of allied troop contributions, made it impossible to predict exact military costs for Iraq into the next fiscal year.
Maybe he should talk to these guys:
In a detailed estimate, the Congressional Budget Office ... said it would cost as much as $13 billion to redeploy U.S. troops in Iraq; up to $9 billion a month to fight the war itself; as much as $7 billion to send the troops back home; and up to $4 billion a month to occupy Iraq.A war lasting two months with a five-year occupation, in other words, could cost as much as $269 billion.
The CBO acknowledged that its estimates are fraught with uncertainty and could even be on the low side. For example, they do not include "any costs for reconstruction or foreign aid that the United States might choose to extend after the conflict ends."
The CBO put those estimates out last October.
Maybe they should let the CBO run the damned war.
An change from $2 billion to $4 billion is an increase of 100%, not 50%.
Check your math. Going from $2 billion to$4 billion isn't a 50% increase. It's a 100% increase, or a doubling.
Yup, there are going to be a lot of explaining about all those schools, hospitals, bridges, and highways not built, and police and firemen who are going to have to 'sacrifice' for Georgie's War on top of a Stupid Tax Shift.
However, Tom DeLay is no poster child for compassionate conservatism either.
Maybe all that district re-jiggering in Texas is not going to help all that much... hope these clowns get tarred and feathered in Nov 2004!
MMMM'Kaaaay! (South Park!)
You also forgot the... what was it? $800 million a month for Afghanistan? Nah let's just call it a round $1 billion.
So that's $5 billion a month just to have or men become bullet sponges.
I wonder what we'll run out of first: dollars or soldiers?
Also, in a CNN.com article today about the House panel on foreign aid, there's a brief mention that the administration didn't request any foreign aid money for Iraq for the coming year (just like they "forgot" Afghanistan this past year.) Apparently they assumed oil revenues would pay for it, and will be making a special funding request "later," now that it's clear those revenues won't be available.
Just priceless.
To answer Lupin's question, we'll run out of soldiers first. Congress owns the printing press with regards to money. They can & will crank out billions till they go blue in the face. Grunts are a different proposition altogether. We've already suffered approximately 1,200 casualties in the last 3 months. That's a batatllion. Once the Shiite's pull the plug and start active resistance we'll be losing that many troops a week. Say hello to the draft & even that won't save their sorry asses. The Republicans are going down on this one.
Note this in the McCain quote:
>yesterday from Rumsfeld
Not "Secretary Rumsfeld", not "Donald Rumsfeld" just "Rumsfeld."
Yeah, McCain is a tough-talker, but ALL Senators hew to a certain level of decorum amongst themselves and other big-wigs.
Nobody likes that guy, and his fall is going to be delicious to watch.
To put the cost of this war in terms that even a Rush listener could understand....
It takes $20 per month from every man woman and child in this country to keep Dubya's war machine in Iraq.
So for your average American family (2.5 kids), it works out to almost $100 a month, for possibly the 5 year total of $5400. You could put a lot of food on your family with that kind of scratch.
As the favorite mantra of the right reminds us, "IT'S YOUR MONEY".
To answer Lupin's question, we'll run out of soldiers first. Congress owns the printing press with regards to money. They can & will crank out billions till they go blue in the face.
What a pity for the rest of the world there's no candidate for an alternative reserve currency.
Hey, wait a minute...
http://economist.com/agenda/displayStory.cfm?story_id=1919390
"Tommy Franks, until recently the battle commander there, told the Senate's armed-services committee that the number of troops in Iraq, currently 148,000, would probably hold steady for the “foreseeable future”, and that America might well stay on for two to four years—hardly the quick pull-out that some politicians had hoped for. The price tag came as more of an unpleasant surprise: Donald Rumsfeld, America's defence secretary, told the committee that the cost of keeping troops there (which does not include reconstruction costs) had risen to about $3.9 billion a month, rather more than the roughly $2 billion monthly bill forecast in April."
http://fareedzakaria.com/articles/newsweek/071403.html
"From the start, internationalizing the Iraq operation has seemed such an obvious solution. But the Bush administration has not adopted it because it holds a whole series of prejudices about the United Nations, nation-building, the French, the Germans and multilateral organizations. In clinging on to ideological fixations, the administration is risking its most important foreign-policy project."
http://economist.com/World/na/displayStory.cfm?story_id=1893625
"Veronique de Rugy of the Cato Institute points out, federal spending has increased at a hellish 13.5% in the first three years of the Bush administration (“he is governing like a Frenchman”). Federal spending has risen from 18.4% of national income in 2000 to 19.9% today. Combine this profligacy with huge tax cuts, and you have a recipe for deficits as far ahead as the eye can see.
"Why has the self-proclaimed party of small government turned itself into the party of unlimited spending? Republicans invariably bring up two excuses—the war on terrorism and the need to prime the pump during a recession; and then they talk vaguely about Ronald Reagan (who sacrificed budget discipline in order to build up America's defences).
"None of this makes much sense. The war on terrorism accounts for only around half the increase in spending. The prescription-drug entitlement will continue to drain the budget long after the current recession has faded. As for Mr Reagan, closer inspection only makes the comparison less favourable for Mr Bush. The Gipper cut non-defence spending sharply in his first two years in office, and he vetoed 22 spending bills in his first three years in office. Mr Bush has yet to veto one."
http://online.wsj.com/article_email/0,,SB105780270564803300,00.html
"A widening federal budget deficit is expected to push Treasury note net issuance up to $89 billion in the third quarter this year, a 19% jump from that of the previous quarter and a 134% surge from that of the year-earlier quarter, according to a survey of primary dealers conducted by the Bond Market Association."
http://economist.com/finance/displayStory.cfm?story_id=1912021
"Asian economies are supporting America's profligate habits. By buying American government securities they help finance America's large external deficit, hold down interest rates, and so sustain the boom in consumer spending and mortgage borrowing. This may benefit America in the short term, but it allows even bigger imbalances, in the shape of consumer debt and foreign liabilities, to continue to build. The eventual consequences for America—and the world economy—could be more painful."
http://www.cm1.prusec.com/yararch.nsf/(Files)/t_051203.pdf/$file/t_051203.pdf
"While foreign investors have cooled to the U.S. stock market, they can't seem to get enough U.S. Government Agency bonds. These are mostly mortgage-backed securities. Indeed, their appetite for these securities has been growing steadily and reached a record high of $210 billion during the 12 months ended February 2003, with record highs of $110 billion and $71 billion for Asians and Europeans, respectively (Figure 9). So foreigners have become a significant source of funds for the U.S. housing market. Last year, they accounted for 22% of the demand for Agencies."
http://online.wsj.com/article_email/0,,SB1057955986494400,00.html
"House Financial Services Chairman Michael Oxley (R., Ohio) has called Mr. Snow to testify July 25 before the full committee on the regulatory structure for Fannie Mae and Freddie Mac. Mr. Snow is expected to comment on a bill sponsored by Rep. Richard Baker (R., La.) that would remake Fannie and Freddie's regulator -- the Office of Federal Housing Enterprise Oversight.
"Mr. Snow's testimony will be key if Mr. Baker is to get his long-awaited bill. The Treasury Department under the Bush administration has been extremely cautious when commenting publicly on either company, keenly aware of the damage done to the markets in 2000 when a top Clinton administration official told Mr. Baker that Congress should repeal the companies' $2.25 billion line of credit with the U.S. Treasury, among other changes.
"Mr. Bush's first Treasury secretary, Paul O'Neill, set the administration's tone on GSE issues last year: “When I hear people say, 'Oh my God, we've got to do something with Fannie and Freddie,' I start with the medical proposition, which is first do no harm.”"
This bit of information, grudgingly disclosed by Rumsfeld in a Congressional hearing yesterday, may just make conservatives think twice about giving Dubya a free pass on all his decisions. If anything makes those folks sit up and take notice, it's dollar signs followed by numbers with 9 or more digits. A few bil here, a few bil there, and it really begins to add up.
Particularly when the domestic economy is in the tank, and Iraq doesn't turn out to be nearly the threat it was believed to be, conservatives are going to be thinking hard about the opportunity costs of all that money being spent on foreign adventures.