The Three-Trillion-Dollar War
By Barry Ritholtz - January 27th, 2011, 2:00PM
Speaking of costly wastes of money: This colorful graphic via Perceptual Edge, shows the outrageous costs of war in Iraq:
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click for truly ginormous infographic
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Whenever I hear a a congress critter discussing deficit spending, the first thing I do is check their vote on the Iraq war to see if they are legitimately concerned about deficits, or not.
Deficit hawk or Hypocrite? You decide:
• Iraq War Resolution, Roll Call Vote – House (clerk.house.gov)
• Iraq War Resolution, Roll Call Vote – Senate (senate.gov)
You will find most of these born again deficit hawks are hypocritical partisan hacks . . .
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January 27th, 2011 at 2:14 pm
“Deficit peacock” is the phrase all the cool kids use.
January 27th, 2011 at 2:15 pm
You’re forgetting what the great South Carolinian, Robert Harper, said in 1798:
“Trillions for Middle-Eastern dictators in league with Iran, but not one cent for the American people!”
He was *way* ahead of his time!
January 27th, 2011 at 2:30 pm
I like the video of that super wealthy tool Issa blowing off the loss of a coupla billion. When I saw that my vital signs went nuts. NOW he’s got religion.
January 27th, 2011 at 2:44 pm
@Drungo
How about the fact that Issa is a three time car thief who burned his own factory to the ground for the insurance money?
http://en.wikipedia.org/wiki/Darrell_Issa
January 27th, 2011 at 2:45 pm
But it’s the entitlements that are bankrupting our nation!
Sheesh, Barry, you are so unpatriotic.
January 27th, 2011 at 2:52 pm
Yeah.
I dont see any of the “deficit hawks” actually talking about common sense solutions to social security or medicare either!
All we would have to do is move up the eligibility age by 1-month per year = permanent overfunding.
Also, we should remove the 100k cap on social security taxes (12.4%!) and make it 6.2% on ALL INCOME. This also = permanent overfunding.
But yeah, cutting govt funded science research. That must be key!
January 27th, 2011 at 2:53 pm
Even just fighting medicare / medicaid WASTE alone… is probably worth $50B+ annually.
Nope… lets cut funding for NPR and save $100m. Must be the key!
January 27th, 2011 at 2:54 pm
It is hard to fathom how they (congress, pres) can’t find the 800 lb gorilla in the budget room.
Shut down the non-declared wars in Iraq and Afghanistan – turn the “war on terror” abstract into a Intel operation, protect the borders and strike the terrorists as necessary to keep down the formation of any structure.
Stop the nation building and imperialism, close large % of international bases — bring the troops home.
Cut all State Dept nation building and foreign aid budgets.
Cut DHS, focus on Special Forces Terrorist Hunt and protecting the borders.
The big runaways in the budgets and gov’t expansion can be traced back to 9/11 2001 — perhaps the best way to get back to fiscal sanity would be to roll back to pre-9/11 budgets and structure.
January 27th, 2011 at 2:56 pm
Conservatives claim that they were angry at Bush for betraying their fiscal conservatism by running up the debt for the two wars and medicare prescriptions.
The Republican House could make good on this claim by paying for it now, but I’m not holding my breath.
Their mendacity knows no bounds.
January 27th, 2011 at 2:59 pm
Unless I missed a decimal point, that works out to spending $100,000 for each man, woman and child in Iraq. And they still claim the war was “worth it”.
January 27th, 2011 at 3:12 pm
Thanks Franklin, but I refuse to read anymore about any of these clowns. My heart you know. Issa does seem to be in a league all by himself.
January 27th, 2011 at 3:44 pm
“You will find most of these born again deficit hawks are hypocritical partisan hacks . . .”
The worst offender being Paul Ryan; the mendacity, asshatery and sheer dishonesty of this guy is enough to convert von Mises to Keynesianism. (How’s that for real bad??)
January 27th, 2011 at 4:02 pm
For once, I agree with cognos. What a moronic thing to even discuss the deficit without discussing this first and foremost.
January 27th, 2011 at 4:02 pm
Hey – Wasn’t this war supposed to pay for itself?
January 27th, 2011 at 4:06 pm
if I remember correctly, the US ran a deficit during WWII, and in the ’60s when it declared war on poverty, space, and viet nam. So, what is new? O, I get it: Democrat Presidents led the US into both World Wars, and the Wars on Poverty, Space, and Viet Nam, but Republicans didn’t. if I also remember correctly, we lost the Wars on Poverty and Viet Nam.
January 27th, 2011 at 4:06 pm
Not to mention our war with Germany – or somebody in or around Germany – with our 52,440 troops there…
http://en.wikipedia.org/wiki/United_States_Armed_Forces
…and our war with Japan – and Asia in general – with our 35,688 there. And our 10,000 in The UK and 10,000 in Italy.
Hey, at least we don’t have any in France.
January 27th, 2011 at 4:06 pm
Cognos; I am with you on social security (which is 100% solvent way past any timeline anybody ever managed to successfully predict anything within). Other ideas would be to leave the income limits but apply social security taxes to capital gains. Even if that was limited to CapG’s above 100K, and/or at a low (1-2%) rate, and/or with a cap on max amount of taxes paid, it would easily fix social security for the next 1000 years.
January 27th, 2011 at 4:10 pm
@Thor: Yes, with “entitlement cuts” of the Sheeple. Not enough money there, you say? Oh, never mind then.
January 27th, 2011 at 4:10 pm
Fred C Dobbs;
The difference is that during those wars we had top tax-rates of 70%+
January 27th, 2011 at 4:22 pm
Here’s all you really need to know on the subject of war.
http://www.youtube.com/watch?v=Cr7ePrCAqzo
We are the killingist bastards to ever walk the earth. Our entire being and our entire culture is built on that simple premise.
January 27th, 2011 at 4:34 pm
Fred, seems like Vietnam started in the Eisenhower administration, a Republican. we can gripe at the democrats for expanding it though. and the space race also started under Eisenhower but was again expanded by the democrats. but then again we did get a lot of technology and inventions out of it. like much smaller computers (back in the day they weren’t smaller than a building. and not a small one either. and that miniaturization process would never have happened with out the demand from NASA and DOD. business was quite happy with those large machines ). now you are on to some thing about the war on poverty, that doesn’t sound like some thing the GOP would have any care about.
and in WW2 we also had a much higher tax rate on the highest paid individuals since they could contribute the most and it was war. seems we lost the urgency this time around. even if we had been told that there were WMD in Iraq. or was it just regime change. i can’t keep up with the different reasons we were there
January 27th, 2011 at 4:36 pm
Deficit hawk or Hypocrite? You decide
no doubt . . .that’s why you should love Libertarians who’s natural tendancy is no to foreign excursions- and global empire . .. can’t be said for the two parties . . .
January 27th, 2011 at 4:45 pm
Thor,
Fieldmarshal Wolfowitz promised we could pay for the war with gasoline savings, not that we invaded Iraq to get their oil…we wanted Osama Bin laden dead or alive!
January 27th, 2011 at 4:50 pm
Amen Ahab.
The only way to get the growth to which their overseer plutocrats are addicted is to keep expanding the empire. But empires, like trees that don’t grow to the sky, eventually reach the limits of their expansion.
January 27th, 2011 at 4:59 pm
Indeed. Because the potential cost of the war was the only factor a representative should have considered in making the decision which way to vote, correct?
You seem to have forgotten your own analysis of other factors that may have swayed a vote entitled “Not-So-Hidden Agenda: Strategic and Economic Assessments of U.S. led Invasion in the Middle East”: http://bigpicture.typepad.com/comments/nothiddenpdf/PreWarEdition%20Mar.19.pdf
Hint: The section containing other factors that may have been under consideration at the time was labelled “PART III: Potential Benefits of Military Occupation”
With 20/20 hindsight from 8 years later it’s easy to paint a silly charicature of a person’s vote. I’m not sure it’s particularly honest or helpful, however, especially considering your own contribution to the “potential benefits” side of the discussion.
~~~
BR: The analysis I reached on the night of the invasion, months after the vote was taken? The one that said the war would last 10 years and cost a trillion dollars?
Seriously, WTF are you talking about?
January 27th, 2011 at 5:04 pm
obsvr-1
You sound just like Ron Paul!
January 27th, 2011 at 5:04 pm
A few facts:
Even if you cut military spending to zero, there would still be a budget deficit.
However, military spending is one of the few items in the budget specified by the Consititution. Article 1 Section 8.
According to the CBO’s numbers, the Iraq war has cost $709 billion.
Opinion:
When all the troops leave Iraq will there still be trillion dollar deficits, almost certainly.
January 27th, 2011 at 5:05 pm
um… definitely hypocrite. That and the tax cut extension. Dont extend tax cuts for the top 1% (or everyone for that matter) and then say you care about the deficit. Absolute bullshit. One or the other.
Question Mr. Ritholtz,
NPR was saying something about social security will be running a deficit (been hearing that for years actually). The new payroll tax cut reduces employee SS contribution from 6.2% to 4.2%. So, is that a big part of the SS deficit (in addition to the demographic shift)?
January 27th, 2011 at 5:07 pm
These costs don’t even include the other costs that we will incur now that Iran is the regional power. Iraq under Saddam was strategically better for the US. Iraq was a deterrent to Iran.
January 27th, 2011 at 5:18 pm
So, is that a big part of the SS deficit (in addition to the demographic shift)?
No. SSA is paying out more now than it is taking in via payroll taxes.
The 2% cut is going to be made up with Treasury giving SSA more of its special Treasuries. This is how Treasury pays the $150B/yr interest burden on the $2.6T trust fund, so there’s no real difference here.
The 2% FICA cut is essentially a 2% tax cut on the first ~$100,000 of income. It doesn’t affect social security at all.
January 27th, 2011 at 5:24 pm
Thanks for explaining that Mr. Flintstone…
January 27th, 2011 at 6:07 pm
*******************************************
*Sigh*
That a person believed the potential benefits of the Iraq invasion outweighed the potential costs back in 2003, does not make them a hypocrite when they express concern about the deficit in 2011. That line of argument is simply incoherent. It’s not even remotely serious. Add to that the fact that in the same time period you yourself came up with YOUR OWN LIST of those potential benefits suggests that you are now engaged in a rather selective and questionable recounting of history. As though there never was and never could have been anyone who legitimately and fairly thought that it might be the best course of action to take with the information that was available at the time. It’s the exact kind of partisan slant you like to attribute to others.
~~~
BR: The information available at the time (and in that report) was that there were no WMD in Iraq, that this was a war of choice, mot necessity, and that it was likely to be extremely costly. That was in my report, and it is what numerous other analysts had determined.
Next up:
1) How about the Bush tax cuts in 2001? 2003? 2010?
2) How about the Prescription drug plan, an enormously expensive entitlement, made even more so by the giveaways to the drug companies?
3) What about the bank giveaways during the bailout?
Other than Ron Paul, most of the current Deficit Peacocks were in favor of all of these budget busters.
What are their excuses for these?
January 27th, 2011 at 6:21 pm
“…… You will find most of these born again deficit hawks are hypocritical partisan hacks . . .”
Really……?
January 27th, 2011 at 6:55 pm
Welcome to the post-modern world.
Balance the budget? Desperately needed.
But NIMBY.
First and foremost, those most in favor of taking a hatchet to social programs are those most insistent on continuing the Bush tax cuts. Create jobs? Where? In Davos?
I will agree totally that Medicare is overflowing with fraud and abuse. Fix it? You bet. Ain’t gonna happen.
I will agree that the parts of Social Security that support fraudulent disability claims needs to be fixed.
It’s just a given in our current moral culture: I am gonna get mine anyway possible.
Until our tax rates match those of other developed countries, with all the loopholes removed, and until we are out of Iraq and Afghanistan totally, taking food out of the mouths of our seniors, and future seniors, to fund a corrupt mullah in Iraq or Afghanistan is unconscionable.
January 27th, 2011 at 6:57 pm
Ooops.
Social security is not an entitlement. Citizens paid for a future return.
What other parts of the government budget are similar in that respect?
January 27th, 2011 at 7:05 pm
I identified this boondoggle in real time..took a little heat at the time, but the cred I gained at my shop for calling it is gratifying.
“freedom fries” “mushroom cloud over NY” “with us or against us” “wmd” To me the whole “product launch” (as one bush minion put it) just did not make sense to me.
Like the banksters and the banking crisis, in the Iraq war nobody truly at fault really lost anything for being wrong..THE LITTLE GUY AND THE TAX PAYER CAN PICK UP THE MESS.
January 27th, 2011 at 7:38 pm
Ahab,
59% of libertarians voted to RE-ELECT George W. Bush in 2004:
http://reason.com/archives/2006/11/07/who-deserves-the-libertarian-v
“Libertarians” should ask yourselves whether you want to continue “enabling” the Religious Right, murderous war pigs, anti-free-market oligopolies, pro-pollution oligarchs masking themselves as free-market proponents, and a police state. If “libertarians” don’t approve of those things, then they should’ve stayed home in Nov 2004 rather than vote for someone who advanced policies supposedly so antithetical to their beliefs.
January 27th, 2011 at 8:02 pm
Wunsacon – I would imagine that’s because so many of the “Libertarians” these days are nothing of the sort. Most of these guys, especially the one’s you find trolling the blogs are about as far to the right as you can get. Simply taking away the religion and social issues from far right Republican ideology does not make one a true libertarian.
January 27th, 2011 at 8:50 pm
Well, there you have it, wunsacon. It seems to me that most so-called “libertarians” only now disassociate themselves with Bush well AFTER the fact. Big shocker there.
@gman: I took the same heat at my “shop” as well for being against the war from the outset. I’m no longer at that “shop”, but I’d guess that most still wouldn’t give me much cred for getting right because being right no longer matters. It’s being in the “cool” crowd and not going against the grain if it hurts your career prospects and social standing. That’s mainly why most people don’t speak up anymore about anything even remotely controversial. Bad for career prospects in the corporate gulag.
January 27th, 2011 at 8:56 pm
The information available at the time (and in that report) was that there were no WMD in Iraq
BR- c’mon man- Bush was going into no matter what- WMD/no WMD- whatever- and congress let him do it-
travesty
Wunsacon-
yeah- I get what you’re saying . . .just like the liberals who voted for Obama . . .only to get more of the same . . .
can’t win can you
January 27th, 2011 at 9:01 pm
Great point, ahab, although many of us foolishly thought the O man would be different. However, this time in ’12, I won’t be voting for anyone, and unlike the so-called “libertarians” who sold out and voted for Bush, I’ll be staying home on election day.
January 27th, 2011 at 9:08 pm
“I’ll be staying home on election day.”
just vote for someone else . . .a 3rd party or a write in. . .
and just to make a point . . .there are those that would make voting mandatory (left wing spectrum)- so staying home would be against the law-
that’s the State telling you what you to do . . .
I will always be opposed to the State telling me what to do
January 27th, 2011 at 9:17 pm
I may do that too. Maybe I’ll write my dog’s name in. Or Jesse Ventura. LOL.
January 27th, 2011 at 9:44 pm
Manny – I feel your pain, in the opposite way though! I was still in SF at the time of the Iraq war and i was about the only person at work of that opinion. I still remember the day we invaded, watching the protests from the 20th floor of our office downtown, I told some co workers that those people protesting were idiots and that they would be proven wrong in due course. . . . .Luckily I now live in LA so my coworkers aren’t constantly giving me shit.
January 27th, 2011 at 9:51 pm
>> yeah- I get what you’re saying . . .just like the liberals who voted for Obama . . .only to get more of the same . . .
Ahab, maybe others will. But, I will *not* vote to re-elect Obama. (I try to learn from my own mistakes…) I will vote for 3rd party candidates, like Mannwich’s dog or Jesse Ventura.
January 27th, 2011 at 10:21 pm
If only imperialism wasn’t so frowned upon in modern society these wars would have made much more fiscal sense. With a trillion in minerals in Afghanistan and the oil in Iraq these wars would have paid for themselves if it was acceptable to “conquer”. I think in modern anti-imperialistic times it will almost always be a poor decision, monetarily, to go war.
January 27th, 2011 at 10:51 pm
Obama has been fiscally sound. He has stood in ground and has not been bullied into invading Iran..like all “fiscal conservatives” would have him. Hmmm …cost of that war…12-15T ..yeah we REALLY care about the deficit..ok..after Iran…Pakistan will blow up so ..
January 27th, 2011 at 10:56 pm
Mannwich..It helps to be a partner..i forced it down a couple of peoples throats.
January 27th, 2011 at 11:07 pm
A meal of humble pie and “freedom fries” is best served up cold to neo-cons. Oh wait the new brand is The Tea Party.
January 28th, 2011 at 12:18 am
Not to mention all of that French wine poured down the drain.
January 28th, 2011 at 7:34 am
Well, most of the expenses on that chart would be there with or without a war, unless, of course, in 2003 we planned to ‘lay off’ all of the troops, stop paying their wages and didn’t give them healthcare. A lot of the expense for “helicopters” sorta kinda goes to American companies that actually make this stuff, not to some Iraqi helicopter manufacturer in the Sunni Triangle. Get real.
It’s a mess, yes, but hard to take any of it seriously with the half-assed “analysis” on a cool looking chart.
As for the cost itself, it has largely been a waste. But, given that in 2003 there were 5 crazy-ass countries (Iraq, Syria, Iran, North Korea, Libya) pursuing nu-clear weapons, and now we’re down to just 2–that has to be worth something.
January 28th, 2011 at 9:52 am
rktbrkr, if anyone wants to talk like Ron Paul, first and foremost they have to tell everyone else what biological ethics they must believe, then what they can and cannot do with their uterus as a result. That’s always been his first agenda.
January 28th, 2011 at 11:07 am
I just re-read the whole joint resolution, and it is basically just an authorization for war. The decision to go to war (or to re-open a previous one whose treaties were not kept) is composed of many factors, little of which is fiscal cost. To even entertain the notion that war is justifiable or not based on fiscal cost is a dangerous one. War should be avoided if possible at ANY COST!
BR, your examples of fiscal irresponsibility, tax cuts, prescription drugs, bank bailouts, in the response above are almost purely fiscal decisions, and you should have led with those, as the definitive factor for evaluating a true fiscal hawk. The prescription drug plan is the holy grail of fiscal recklessness. The bank bailouts are such an easy example, because they contain moral and fiscal hazard… not a comprise between the two.
Michael