The Long-Term Costs of the War in Iraq

The Long-Term Costs of the War in Iraq

How much will the Iraq war cost us?:

Experts Calculate Billions in Long-term Costs of War, PBS [Real Audio - Download - Streaming Video]: Congress has approved about $450 billion to date for the Iraq and Afghanistan wars, but economists also have been tabulating the long-term costs such as veterans' care. Economics correspondent Paul Solman explores the broader costs of the war.

JIM LEHRER: Now, what the war in Iraq is costing. Democrats in Congress are still trying to pass a war funding bill the president will sign. That legislation will provide money for military operations, but those funds are only part of the larger price tag. The NewsHour's economics correspondent, Paul Solman, has our report.

PAUL SOLMAN [NewsHour Economics Correspondent]: The cost of the Iraq war, it's a far cry from the original estimates.

DONALD RUMSFELD [Former U.S. Secretary of Defense]: The Office of Management and Budget estimated it would be something under $50 billion.

GEORGE STEPHANOPOULOS [Host, "This Week"]: Outside estimates say up to $300 billion.

DONALD RUMSFELD: Baloney.

PAUL SOLMAN: The $50 billion estimate turns out to be a modest fraction of what the war has actually cost thus far, the out-of-pocket, mainly military costs.

GREG SPEETER [National Priorities Project]: We're averaging, over the period of the war, about $275 million a day.

PAUL SOLMAN: Greg Speeter runs the National Priorities Project and its costofwar.com Web site, which tracks the spending per second. At this point, says Speeter, the total is close to $450 billion.

GREG SPEETER: That gives you some indication of just how expensive this war is.

PAUL SOLMAN: But, no, it really doesn't, according to those who've looked at the numbers more broadly. As economist Linda Bilmes explains...

LINDA BILMES [Harvard University]: Even if we withdrew all of our troops from Iraq tomorrow, the war would still keep costing us money for many, many years to come, because there are several long-term costs which are not included in the running costs of the war.

PAUL SOLMAN: With Nobel laureate economist and former Bill Clinton adviser Joe Stiglitz, Bilmes did a cost study that's received a lot of attention for its bottom line.

LINDA BILMES: The total cost of the war would be between $1 trillion and $2 trillion.

PAUL SOLMAN: But how do you get from $450 billion to as much as $2 trillion? Let's take the added costs one at a time.

First of all, says Professor Stiglitz, during any war...

JOSEPH STIGLITZ [Columbia University]: ... you use up equipment. Equipment gets depreciated, deteriorates, and much of that doesn't get replaced until after the war is over.

LINDA BILMES: There's also the cost of what's called resetting the military, retraining the troops and bringing the U.S. military force back up to its pre-Iraq strength.

PAUL SOLMAN: Plus, says Stiglitz...

JOSEPH STIGLITZ: One of the consequences of the war is that people are not volunteering for the Army. To recruit people into the Army, you have to pay big bonuses, so our overall recruitment cost skyrocketed.

The addition of medical costs

PAUL SOLMAN: Summing all increased military costs would add at least $125 billion to the total. An even bigger addition, though, comes from medical costs, present and, more importantly, future.

LINDA BILMES: In this war, there are eight wounds in combat for every fatality and another eight injuries and illnesses for people who are over there. So, in total, it's 16 wounded or injured soldiers for every one who is killed in Iraq. ...

PAUL SOLMAN: We've seen these costs before on the NewsHour: 23-year-old Sergeant Joseph Youn, for example, his brain hit by shrapnel two years ago, a hospital inpatient ever since...

PAUL SOLMAN: Eddie Ryan, also 23, shot in the head by friendly fire. The Veterans Administration pays $250,000 a year to care for him at his rural New York home for as long as he lives.

When Bilmes tried to estimate the cost of all long-term medical care due to Iraq casualties like these, she got a range of $200 billion to $400 billion, depending on how long the war lasts, to which she and Stiglitz also add the cost of long-term disability for soldiers like Brad Heun of Tennessee, a former auto mechanic whose vertebrae were crushed in Iraq.

BRAD HEUN [Injured Iraq Veteran]: There's absolutely no way I could stand on my feet for that length of time or bend over the hood of a car.

PAUL SOLMAN: After the first Gulf War, which lasted about a month, nearly half of the 200,000 Americans who fought filed disability claims. Meanwhile, this time, close to a million Americans have been deployed in Iraq thus far, half of them more than once and for long periods of time.

LINDA BILMES: Just this year, there have been more than 50,000 claims by veterans, disability claims, which involved eight or more separate conditions.

PAUL SOLMAN: Rex Collier happened to be one of our audio men for this story. His son, Bradley, a Marine, was wounded in Ramadi.

REX COLLIER [Father of Injured Marine]: He was hit by a sniper from a rooftop that popped up and shot him with an AK-47 down into his shoulder, through his Kevlar. It went into his lung. And then an RPG hit a truck behind him about the same time and took shrapnel in the other arm.

PAUL SOLMAN: He's been in constant pain ever since, suffers from PTSD, post-traumatic stress disorder. At a restaurant, says Collier, his son...

REX COLLIER: ... would not have his back exposed, was always on the lookout, constantly looking up and finding himself glancing up, looking around all the time, as if he were on patrol for somebody to possibly be hidden away to shoot him.

The issue of disability payments

PAUL SOLMAN: Bradley Collier's disability pay: some $15,000 a year. Brad Heun gets $30,000 for a family of five. But multiply even these modest amounts by the number of soldiers maimed, times their life expectancy, and Bilmes and Stiglitz get a long-term disability number between $70 billion and $150 billion, in which case the total cost of the war would rise to a range of about $850 billion to $1.2 trillion.

But even $1.2 trillion doesn't capture the real cost to Americans, Joe Stiglitz argues, the social cost.

JOSEPH STIGLITZ: If somebody gets disabled, the U.S. government pays him disability for the rest of his life. But these disability payments are typically just a fraction of what this individual would have earned. It certainly doesn't compensate him.

If you asked him, "Would you rather have an arm or get that disability payment?" there would be no question. He'd say, "Give me my arm back." So the disability payments vastly underestimate the cost to the individual, to his family, to our society.

PAUL SOLMAN: How much money would you spend, borrow, steal, maybe, to be able to buy your son out of that whole experience so that your son would be the guy he was before he went to Ramadi?

REX COLLIER: There really isn't a price you can put on it. Whatever was asked to avoid that, I would have given that much and found a way to find it, to come up with it.

PAUL SOLMAN: And speaking of priceless, what about life itself?

REX COLLIER: There's no number. If my child was missing in combat, I would do absolutely anything.

PAUL SOLMAN: Anything at all, says insurance agent Bruce McElhaney, who does volunteer work for Iraq veterans and families of the deceased. One way to reckon the value of a life lost: what the family actually gets in life insurance -- at least $100,000 -- plus, if the fallen soldier bought the maximum insurance policy...

BRUCE MCELHANEY [Veterans Volunteer]: ... $400,000.

BRUCE MCELHANEY: There are also some survivorship benefits for the spouse and the children.