What it may cost to stay in Iraq

President Bush talks of an 'enduring' relationship; researchers speculate on a $1.5 trillion price tag.

By David R. Francis | columnist

from the September 24, 2007 edition

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Alan Greenspan certainly kicked up a storm when he wrote in his new book, "the Iraq war is largely about oil."

After the White House reaffirmed that the US invasion of Iraq was really about weapons of mass destruction, the former Federal Reserve chairman backtracked somewhat from his controversial statement during a publicity push last week for his book, "The Age of Turbulence."

Whatever the motive or motives of President Bush for his decision to go to war, his oil-industry background would have made him aware of the importance of Middle East oil, including that of Iraq, to the energy needs of the United States.

As Mr. Greenspan writes: "The intense attention of the developed world to Middle Eastern political affairs has always been critically tied to oil security."

Mr. Bush didn't specifically mention oil in his talk to the nation 11 days ago. His emphasis was on fighting terrorism. But, he warned, "Extremists could control a key part of the global energy supply." And he did talk of an "enduring relationship" with Iraq requiring a United States political, economic, and security engagement extending beyond his presidency.

That relationship could be expensive.

The latest estimates of the cost of the Iraq war by Steven Kosiak, an analyst at the Center for Strategic and Budgetary Assessments, a Washington think tank, puts the cost of the Iraq war so far (measured by congressional appropriations) at $450 billion, and that of the Afghanistan operation at $127 billion. By the end of fiscal year 2008, about a year away, the combined bill will be $808 billion.

"The war in Iraq, alone," notes Mr. Kosiak, "has already cost the US more in real [inflation-adjusted dollars] than the 1991 Gulf War and the Korean War, and it will almost certainly surpass the cost of the Vietnam War by the end of next year."

If the two military operations drag on for a decade, the cost could amount to between $1.09 trillion and $1.62 trillion, he speculates, depending partly on what level of military forces are left in the two nations.

Those numbers, admits Kosiak, don't include the cost of the extra debt piled up by Washington to pay for the operations. Those would add "several hundred million" more to the bill in the next decade. He says the Bush administration has put the cost of the operations "on the national credit card."

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