March 23, 2007:
The war on terror has cost $510
billion so far. General counter-terror and security operations have accounted
for six percent of that, Afghanistan operations another twenty percent, and
Iraq the rest. Iraq operations are costing about $100 billion a year, while
Afghanistan costs about a fifth of that. The Department of Defense spends about
93 percent of this money.
Most of the costs go to construction,
transportation and hiring of civilian contractors (mainly for support jobs, but
also for security work.) Putting reservists on full time duty status has also
been expensive, but not as much as the higher paid civilians.
About fifteen percent of the money goes to buying
and repairing equipment and weapons. The war effort is building lots of spiffy
new bases, especially in Iraq, but it is also enabling the army and marines to
upgrade their weapons and equipment, while, at the same time, making sure that
new stuff works in combat. The army and marines are quite happy with this, but
keeping quiet about how they are, in the process, obtaining new stuff they
didn't expect to see for another decade. Compared to past wars, not a lot of
ammunition has been used, and this accounts for less than one percent of all
costs.
Even after adjusting for inflation, the war on
terror has cost more than the Korean or Vietnam War. However, World War II is
still Americas most expensive war, at over two trillion dollars. But because
the U.S. economy is so much larger, the war has been a much smaller burden on
the economy. War costs are currently about one percent of GDP a year, compared
to 14 percent during the peak years of the Vietnam war, nine percent during the Korean war, and
nearly fifty percent during World War II.
In the long run, however, the costs of veterans
care will add another 20-30 percent to the cost of the war. Veterans costs will
be lower for the war on terror, than for earlier wars, because far fewer troops are involved, and
casualty rates are much lower than previous wars. Ignoring Saddam Hussein, and
leaving him in power, would have continued to cost about $15 billion a year to
maintain the no-fly zone. A lot cheaper than current costs for dealing with
Iraq. But Saddam, based on past performance, was very likely to cause major
trouble again, and there would then have been an expensive war anyway. No one
knows for sure, because accurate, or at least generally agreed on, predictions
the future are currently not available for any price.