Monday, August 11, 2003

This takes the old phrase "You break it, you bought it" to a whole new level.
More than three months after Bush declared an end to major combat operations in Iraq, even the cost of the ongoing U.S. military campaign remains clouded in confusing numbers.

Defense Department officials have said U.S. operations are costing about $3.9 billion monthly. But that figure excludes indirect expenses like replacing damaged equipment and munitions expended in combat.

Dov Zakheim, the Pentagon's top budget official, has said that when all the costs are combined, he expects U.S. military activities in Iraq to total $58 billion for the nine months from last January through September. That includes part of the buildup, the six weeks of heaviest combat that began March 20, and the aftermath.

That sum, however, is what Congress provided this year for Defense Department activities not only in Iraq but also against terrorism worldwide � including Afghanistan, where U.S. military costs are running about $1 billion a month, according to officials.

In a report last month, the nonpartisan Congressional Budget Office projected that Pentagon costs in Afghanistan and Iraq plus other U.S. military efforts against terrorism around the globe could reach $59 billion next year.
So apparently, the Pentagon's punch line to Congress is: "you ain't seen nothin' yet!"

This is truly stunning. At a minimum, the war/occupation will cost the US government $70bn in 2003 and another $45bn or so in 2004. Private think tanks put the long-run sums at truly staggering levels.
Brookings Institution fellows Lael Brainard and Michael O'Hanlon said in a Financial Times article this month that military and reconstruction costs could be from $300 billion to $450 billion.

Taxpayers for Common Sense said postwar costs over the next decade could range from $114 billion to $465 billion. The American Academy of Arts and Sciences projected 10-year expenses from $106 billion to $615 billion.
The low-ball figures for both these latter groups are already passe. And with the US strategy of rent-an-ally combined with the unexpectedly slow return of Iraqi to the world market, the billions coming out of the US Treasury will continue to flow like water downhill.

It seems undoubted now that the GDP figures for 2003:III and probably 2003:IV will be heavily skewed by this military spending, just as the numbers from 2003:II were. But I've got to believe that sooner rather than later the House Republicans will really start to feel that "budget discipline" itch.

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