Let’s get one thing straight: Wars cost money. Even the small ones. Already, the United States has spent hundreds of millions of dollars firing Tomahawk missiles into Libya. Analysts say that the total price tag for the operation, if everything goes well and there’s no escalation, could easily exceed $1 billion. That’s peanuts compared with our $3.8 trillion budget. But it’s not nothing.
A billion dollars, for instance, is more than 40 times the total NPR subsidies that inspired House Republicans to convene an emergency session of the Rules Committee to speed cuts along to the floor of Congress. That’s not to say saving the lives of Libyans isn’t a better investment than supporting “All Things Considered,” but it’s real money, and because it’s going to Tomahawk missiles in Libya, it can’t go to something else.
Ezra Klein
Ezra Klein is the editor of Wonkblog and a columnist at the Washington Post, as well as a contributor to MSNBC and Bloomberg. His work focuses on domestic and economic policymaking, as well as the political system that’s constantly screwing it up. He really likes graphs, and is on Twitter, Google+ and Facebook. E-mail him here.
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But for more than a decade now, we’ve waged war as if it were free, keeping our wars off the budget and, rather than paying for them as they were fought, slapping them on the national credit card. Paying as you go, after all, is hard. It forces you to make decisions about competing priorities. When you don’t pay up front, those decisions become easy. And war should never be easy.
But before we can start paying for war, we need to account for it properly. You might recall Lawrence Lindsey, director of President George W. Bush’s National Economics Council, being taken to the woodshed for estimating the costs of the Iraq War at $200 billion, when the administration was trying to sell the invasion as a $50 billion venture. Both numbers were tossed around like they were price tags for the entire war. They weren’t. They were estimates of its first six months. That’s one way we lowball the costs of war: estimating them only a few months at a time. The Congressional Budget Office now says the tally is likely to total $1 trillion.
Even that estimate, however, is far, far too low. It primarily counts “direct costs” — what will be spent on soldiers, supply chains and weaponry over the course of the war. But what about the long-term care for veterans who return with brain injuries or mangled limbs? Or the expense of replacing the equipment that is destroyed or worn down in combat? What about the costs to the broader economy when the price of oil soars?
A few years ago, Harvard budget expert Linda Bilmes and Nobel Prize-winning economist Joseph Stiglitz set out to construct a more holistic estimate of the costs of the Iraq War. They ended up nearer to $3 trillion, and they were trying to be conservative. For those playing along at home, that’s about equal to every dollar of debt Bush piled up in his eight years as president.
Honest budgeting serves a purpose beyond making sure revenue matches spending. “My Nobel Prize was in the economics of information,” Stiglitz said in a 2008 speech presenting these findings. “Information affects decisions.” The debate leading up to these exchanges can be hot, emotional and polarizing. The numbers on the page — and the trade-offs they demand — are as close to rational as the political process can get. That’s the point of them. By forcing us to make the tough decisions, they help us make good decisions.
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