Joseph Stiglitz and Linda Bilmes. The Three Trillion Dollar War.
Article Type: Book review
Subject: Books (Book reviews)
Author: Khan, Abdul Qayyum
Pub Date: 03/22/2010
Publication: Name: Pakistan Development Review Publisher: Pakistan Institute of Development Economics Audience: Academic Format: Magazine/Journal Subject: Business, international; Social sciences Copyright: COPYRIGHT 2010 Reproduced with permission of the Publications Division, Pakistan Institute of Development Economies, Islamabad, Pakistan. ISSN: 0030-9729
Issue: Date: Spring, 2010 Source Volume: 49 Source Issue: 1
Topic: NamedWork: The Three Trillion Dollar War (Nonfiction work)
Persons: Reviewee: Stiglitz, Joseph; Bilmes, Linda
Accession Number: 238556932
Full Text: Joseph Stiglitz and Linda Bilmes. The Three Trillion Dollar War. Penguin Group. 2008.311 pages. Hardbound. UK Pound 20.00 pounds sterling].

The quick and costless conflict in Iraq, predicted by the Bush administration, is nowhere to be seen and the actual costs of the war in Iraq far exceeds the estimates developed by the then administration before going to war. This is the central message of The Trillion Dollar War by Joseph Stiglitz and Linda Blimes.

The authors argue that the cost of the military operation in Iraq has exceeded the cost incurred on the 12-year war in Vietnam and is more than two times the cost incurred on Korean War. They show that the per troop cost of the Second World War was less than $100,000, in real terms, while the cost of war in Iraq is around $ 400,000 (in 2007 dollars). The authors lament that the war in Iraq has been financed from borrowings rather than taxes. They argue that recognition of the cost of war cannot be put off for long and cannot be transferred to the coming generations without risking adverse consequences for the economy.

The authors argue that the estimates of war expenditure were nothing but fallacious. Larry Lindsey (Bush's economic advisor) had put the estimate of the total expenditure on war at $200 billion as the war began. This figure was cut down to an unbelievable $60 billion by Mitch Daniels, secretary to Donald Rumsfeld, the then Defense Secretary. The fallacy of these estimates was exposed when the U.S. Congress approved $845 billion for 2008 alone, for military actions and war supplemental requisites, in Iraq and Afghanistan. Only the running expenditure on military operations cost the U.S. exchequer $12.5 billion per month in 2008. This does not cover the $500 billion per year expenditures of the U.S. Defense Department and other hidden costs.

Human life, though priceless, must be priced to arrive at some reasonable estimate of the expenditures on wars, and this is what the book does to account for the U.S. casualties in the war. Putting the price tag of $7 million on human life--the monetary value typically assigned by the U.S. government to a young man killed in a car accident, the authors put the cost of 4000 casualties of American soldiers at $28 billion. If the casualties like, 'killed in night-time vehicle accident', which the government terms as non-combat incidents, are also accounted for, then the cost of human tragedies shores up significantly. Arguing in this manner the authors arrive at an estimate of $3 trillion as the cost of Iraq War, to the United States alone, add to it the explicit and implicit, expenditures incurred by rest of the world and the estimates balloon.

United Kingdom--The second major player in the Iraq War has also paid heavily for the war. The book establishes an estimate of the cost of the war for United Kingdom as well. The estimates show that by the end of 2007 the estimated direct monetary cost to UK had reached to 7 billion [pounds sterling]. With thousands of soldiers becoming disable and many family members sacrificing jobs to care for their wounded relatives, the social costs to UK was no different than that incurred by the U.S. The authors expect that the long term macroeconomic costs for UK might be lesser than what the U.S. would have to assume. The reason, the book argues, lies in the tight fiscal policy maintained by the UK. However despite the reduction in troops and the corresponding cut in personnel cost, the aggregate cost of war in Iraq will increase by 2 percent for the United Kingdom. Based on these assumptions the total cost to UK of the wars in Iraq and Afghanistan exceed 20 billion [pounds sterling] in 2010, if the social cost is included.

To conclude, the book induces the reader to ponder, whether the war planners themselves believed in the estimates and what benefits they had in mind to justify the costs and whether the benefits will outweigh the costs. The book is highly recommended for those with interest in political economy.
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