Bush Aide Says Iraq War Cost May Reach $200 Billion

Reuters ^ | September 16, 2002

[Jordi]

NEW YORK (Reuters) - President Bush's chief economic adviser estimates that the U.S. may have to spend between $100 billion and $200 billion to wage an Iraq war, but doubts hostilities would push the nation into recession or sustained inflation, The Wall Street Journal reported Monday.

Lawrence Lindsey, head of the White House's National Economic Council, projected the "upper bound" of war costs at between 1 percent and 2 percent of gross domestic product, the Journal reported.

With the U.S. GDP at about $10 trillion per year, that translates into a one-time cost of $100 billion to $200 billion, according to the Journal article. That is considerably higher than a preliminary, private Pentagon estimate of about $50 billion, according to the Journal.

In an interview in his White House office, Lindsey dismissed the economic consequences of such spending, saying it would not have an appreciable effect on interest rates or add much to the federal debt, which is already about $3.6 trillion, the Journal reported.

At the same time, he doubted that the additional spending would give the economy much of a lift, according to the Journal.

Other administration economists say that their main fear is that an Iraq war could lead to a sustained spike in prices, according to the Journal.

The past four recessions have been preceded by the price of oil jumping to above $30 a barrel, the Journal reported, citing BCA Research.com in Montreal.

But the White House believes that removing Iraqi oil from production during a war -- which would likely lead to a short-term rise in prices -- would be insufficient to tip the economy into recession.

[kcvl]

Still cleaning up the mess of the Clinton binge...

[Waco]

So? Take out one $Trillion worth of oil! No prob. No biggie!

[NYS_Eric]

Good. This implies that we will prosecute this war with overwhelming force (up to $200 billion) rather than try and get out of this on-the-cheap. There are some things more important than trying not to run up a deficit and this is one of them.

And when we're all done, I hope the annual defense budget sees a permanent and substantial upward boost so the rebuilding can begin. We are stretched too thin.

[ReleaseTheHounds]

I agree with your "pay for it with oil revenues" -- no reason we shouldn't "charge" Iraq (and the rest of the world for that matter) for the cost of prosecuting this war.

And no matter what the cost (and we should spend enough for "overwhelming" strength to prosecute it), the benefit is more than worth it. What was the cost of winning the Cold War (thanks to Ronald Reagan)? Yes, huge deficits that were ultimately replaced by surpluses (thanks to Reagonomics)... but the worldwide benefit cannot be calculated in financial terms: billions of people liberated from Communism; countless billions of future generations growing up under relative freedom and free markets compared with the alternatives.

Bush's war on terrorism has the same potential: it would rid the world (or significantly reduce the threat) of one of the few remaining global threats to world peace and human liberty.

[Squantos]

Cleaning up more 9-11 style attacks will surpass the 1 trillion mark IMHO with regards to more security and rebuilding here at home if such occurs or is allowed to continue.

I say take the fight to their own backyard. I want to see all 12 presidential-King-Grand Poohbah mansion sites that Saddam now hides in turned into smoking holes in the ground. Hopefully one of them becomes his grave.

Lets get it done NOW !

Stay Safe !

[kellynla]

I still like the Marine Corps Sniper way. One shot, one kill. And the cost to eliminate Saddam with one bullet... Semper Fi

[marron]

Nothing wrong with getting our accounting straight.

While we're at it, though, don't forget to include the cost, for comparison purposes, of maintaining a war-fighting force in the region for a decade in order to keep a lid on this guy. This may give an indication of what the continueing cost will be if we don't deal with him.

We can also take a look at the cost of maintaining a major force in Germany, where they are no longer needed, and furthermore are hostage to the whims of a leftist prime minister, who has refused to give permission for the use our own troops. What ever that cost of, its wasted in the post-NATO world. Which we have been in since the commencement of the Afghan War.

[ppaul]

[Grampa Dave]

Thanks, it sounds like one of the best use of our tax $'s since I started paying taxes.

If Saddam sets off one nuclear weapon in NYC, LA, DC or Miami, the costs to the nation will be Trillions and Trillions of $'s.

Our new 51st state called Freedom, (the former countries of Iran/Iraq/Syria will bring a lot of petro $'s. We can start taxing the Opecker Nations for the cost of the war.

We can pull out of Nato and other Euro trash areas.

By not signing into the Kyoto punish America BRAVO SIERRA, President BUSH has paid for the Iraqi war and more.

When we vote out a large number of Pro Iraqi/Islamakazi Senators this November, Da$$hole and his tax and spenders will have to slither to the rat holes in the Senate. The savings to the country by not having Da$$hole, the Hildebeast, Kennedy, Boxer, Chi Fi Frankenstein in charge of the senate will be in the trillions in the next 6 years.

[Grampa Dave]

Iraqi skeet shooting as demoed by Saddam!

[FreedomFriend]

Hint: There will never be world peace until Christ returns.

[FreedomFriend]

Our new 51st state called Freedom, (the former countries of Iran/Iraq/Syria will bring a lot of petro $'s. We can start taxing the Opecker Nations for the cost of the war.

That's interesting that you'd support an Arabic state. It'd be a constant problem for the US. Furthermore, you'd support the US take-over of sovereign nations?

[Grampa Dave]

I knew that someone like you would jump and strike that big old fishing fly I cast out there.

There will be no 51st state!

Have you had a moment of sorrow for those innocent Americans killed on 9/11/2001?

How many more Americans should be sacrified to satisfy your goals to hide our heads in the sand, 10%, 30%, 60%, 80% or more of our population?!

[lexington minuteman 1775]

Iraq has the second highest oil reserve in the world.How about we take a percentage of oil from Iraq to defray war costs. The Iraqi people benfit from no longer having a Sadaam to live with.Seems like a fair trade-off.

[hchutch]

They started the war. They knew going in that they could LOSE the war, and that one of the risks of losing the war is losing soverignty or territory.

I wouldn't go so far as statehood right away, but "The American Middle East Territory" has a nice ring to it.

[Rockitz]

Send the bill to the Saudis.

[Registered]

How can one nuclear bomb cost that much money?

[ConservativeNewsNetwork]

If we annex Iraq, Iran, and Syria this shit will never end. A democratically ruled Iraq, Iran, or Syria will naturally tend to have strong ties with the US, because we are the best market for their national resource - oil. With money going through more hands than Hussein or the ibn Sauds, the people will become more prosperous and be less likely to want to fly planes into buildings. The reason that the third world hates us is because their corrupt leaders keep their people in squalor for their own benefit. The people will get rich, we'll get richer, and the Euroweenies will feel even more irrelevant then they already do. It's win-win for the US and the Arab people.

[Jordi]

Some of you think that an easy repayment would be the prolonged occupation of Iraq, and even of Iran and Syria. Surely there's enough petroleum around there to keep the world running for years (and you could calculate an average net return of 10$ for each barrel extracted). But in this case you have to add in the minus column the expense to mantain a million or so sized garrison there (I mean, if the US occupy Iraq, Iran and Syria, for Iraq alone perhaps 300-400k would be enough). If the average expense, all included, is some 200k $ a year for each militar there, it means further 200 billion more a year.