Fighting ISIL – How much will it cost? Op-ed by Linda J. Bilmes

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http://www.bostonglobe.com/opinion/2014/10/07/fighting-islamic-state-how-much-will-cost/xub6sT2eWP1k67t1HWBsFL/story.html?comments=all&sort=HIGHEST_RATING

The Boston Globe

TWELVE YEARS ago we stumbled into a war in Iraq with little thought as to how much it would cost or how we might pay for it. Trillions of dollars later, we are about to wade into another protracted conflict, and once again there is no financial strategy.

President Obama and his military top brass have pronounced that the effort to defeat the Islamic State will be “long” — translation: expensive. The Pentagon has admitted to spending over $1 billion so far, with the current pace running at some $10 million per day. Todd Harrison of the Center for Strategic and Budgetary Assessments believes the annual bill for military operations will range from $4 billion to $22 billion, depending on duration, scope, and the extent to which ground forces get involved — which is becoming increasingly likely. Obama has ruled out sending troops, but it is clear the Pentagon has not given up on boots on the ground — they just may not be worn entirely by Americans.

The experience of Iraq and Afghanistan proves that the price tag may be steep. In addition to the bill for military operations, there are costs associated with veterans’ benefits, depreciation of equipment, humanitarian aid, covert action, and paying (as the US frequently does) for the military efforts of our coalition “partners.”

Caring for veterans is a major expense, even in a short conflict. In the 1991 Gulf War, Kuwait and Saudi Arabia paid for most of the upfront US military operations — but today the Department of Veterans Affairs pays $4 billion per year in compensation to US veterans of that conflict. For Iraq and Afghanistan, the veterans’ costs will be much higher. Fifty percent of the troops who served to date will receive medical and disability benefits for the rest of their lives — amounting to some $1 trillion that the United States owes but has not yet paid.

Even bigger than the direct costs of the new campaign against the Islamic State is the dramatic U-turn in the political mood toward military spending. Twelve months ago, the wartime culture of “endless money,” as former Defense Secretary Robert Gates dubbed it, with its endless “emergency” funding from Congress (nearly $2 trillion in more than 30 special funding bills) — was finally coming to an end. The Beltway was filled with talk of belt-tightening at the Department of Defense, including a 10-year $497-billion cut imposed by the so-called sequester. The Pentagon was proposing to shrink the size of the armed forces, trim military compensation and benefits, and mothball expensive weapons and military installations left over from the Cold War.

But now that’s all so-last-fiscal-year. The new trend is ramping up Pentagon spending. At their press conference last week, Defense Secretary Chuck Hagel and Martin Dempsey, the Chairman of the Joint Chiefs of Staff, declared that they don’t have enough funding to conduct the operation against the Islamic State.

In addition, Congress is refusing to let the Pentagon make even modest changes to its current base benefit plan. This will surely encourage the department to ask for another blank check to pay for new operations. Requests are already mounting.

The combined cost of abandoning planned cutbacks at the Defense Department, new spending to combat the Islamic State, and extra foreign military assistance means that America will wind up spending up to $100 billion more on military activities than we had expected this year alone.

This amount should force Americans to debate the trade-offs between current spending priorities and the cost of expanding military operations against the Islamic State. But instead, Washington assumes that we will simply borrow whatever is needed — and continue to pass the cost of today’s wars onto future generations. This feckless approach has already led to much higher national debt, as well as rampant waste and corruption in our military appropriations. More importantly, the policy of paying for wars on the credit card has contributed to a widening gap between the small percentage of the US population who are serving in the volunteer force and the rest of us — who are neither serving nor bearing the financial burden.

Financing the Iraq and Afghanistan conflicts with debt has hidden the true costs from public view. Over the past 14 years, it has seemed almost unpatriotic to question whether the nation could afford to continue spending 20 cents of every tax dollar on the military — regardless of whether the item in question was necessary or even good value. The United States is a wealthy country, but we are now coping with the legacy of two expensive wars. President Obama has just asked Americans to embark on another decade-long military engagement. He needs to propose a strategy for how it should be paid for, and what sacrifices will be required.

Iraq Mortality estimated at more than 400,000

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A new peer-reviewed study estimated that mortality in Iraq during the war years resulted in 405,000 more deaths than would have occurred in the absence of the conflict.

Previous estimates of mortality in Iraq attributable to the 2003 invasion have been heterogeneous and controversial, and none were produced after 2006. The purpose of this research was to estimate direct and indirect deaths attributable to the war in Iraq between 2003 and 2011.     Mortality in Iraq Associated with the 2003–2011 War and Occupation.

Cost of Iraq and Afghanistan estimated $4 to $6 trillion

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Linda Bilmes new paper revises war costs upwards based on increased utilization of medical care by active duty troops, families and veterans,  as well as increasing volume and complexity of disability claims by veterans from Iraq and Afghanistan.

Read the paper:

https://research.hks.harvard.edu/publications/workingpapers/citation.aspx?PubId=8956&type=WPN

 

The Watson Institute at Brown University, funded by the Eisenhower Institute, has published a wide-ranging new study of Iraq and Afghanistan war costs that was compiled by some 20 academic contributors and led by Professors Catherine Lutz (Brown) and Neta Crawford (Boston University).  Contributors include Andrew Bacevich (BU) , Winslow Wheeler (Center on Defense Information), Anita Dancs (National Priorities Project), Ryan Edwards (Queens College, NYU) and many others.  Linda Bilmes wrote the section of the report that estimates the costs attributable to veterans medical care and disability benefits.

The study focused particularly on war costs that have occurred (or been incurred but not yet paid) during the past decade since September 11, 2011.  It features important new work on the casualties and costs to defense contractors, and the social impact on military families.   The section by Winslow Wheeler analyzes the increases in the defense base budget over the past decade.  Portions of the report focus on costs to Iraq and to the region.   The website includes a range of charts and tables.    The study covers overlapping, but somewhat different ground, from the Stiglitz-Bilmes study.

SEE: http://costsofwar.org/

Stiglitz Bilmes new book chapter in the Oxford Handbook of the Economics of Peace and Conflict

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Read our latest book chapter, Chapter 13: in the Oxford Handbook of the Economics of Peace and Conflict:

Link to Book: http://www.socsci.uci.edu/~mrgarfin/OUP/

Link to Chapter 13: “Estimating the costs of war: Methodological issues, with applications to Iraq and Afghanistan.” http://www.socsci.uci.edu/~mrgarfin/OUP/papers/Bilmes.pdf

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