The Cost of the "War on Terror"

by Manlio Dinucci

A US university institute has made a detailed assessement of the cost of the “war against terrorism” for the US alone. It revealed that the actual bill is likely to be three times as high as the amount voted by Congress and that it is a determining factor of the financial crisis lashing the country. Manlio Dinucci deplores that the estimate disregards the cost for the countries devastated by the war.

What is the economic cost of the “war on terror" that the US launched ten years ago? The Watson Institute for International Studies at Brown University (New York) has worked it out [1]. The invasions of Afghanistan in 2001 and Irak in 2003 together with the successive extension of military operations in Pakistan entailed an estimated cost of 4 trillion dollars.

In order to have an idea of what it represents, one need only think that it is the equivalent of three centuries of Afghanistan’s GNP and one and a half in that of Iraq’s.

The Institute’s team of over twenty researchers focused above all on direct military spending, constituted by the sums allocated for the war added by Congress to the Pentagon budget: 2 trillion dollars. That amount was not available in the public coffers. It was thus borrowed from banks and international organisations, which compelled the federal government to pay outrageously high interest (with taxpayer money): some 200 billion dollars in ten years. An additional 74 billion dollars were spent, under the guise of extraordinary aid, to back the puppet regimes brought to power in Iraq and Afghanistan. Moreover, the "war against terrorism" ran up a bill of some 400 billion dollars, spent on strengthening “homeland security”. To these expenses must be added the costs for assistance to the wounded and disabled by war: running at 32 billion dollars so far. This is only the tip of the iceberg: the veterans claiming compensation for injuries and disabilities are more than one million. It has been estimated that, in 30-40 years, their cost will jump from 600 billion to 1 trillion dollars.

In spite of the much trumpeted plan to downsize the number of troops in Afghanistan and Irak, more war funding has been requested: at least 118 billion for fiscal year 2012, which will come on top of the 553 billion Pentagon base budget. Thus, the cost of war will climb well beyond 5 trillion dollars. Public debt is growing as a consequence, a debt that the State will not be in a position to reimburse and interests could reach 1 trillion dollars in the course of the current decade. This is leading to an increase in interest rates (i.e. the cost of money) with a cascading effect over the US middle class. Last year, because of the increase in interest rates, house buyers saw their mortgages rise by 600 dollars on average.

On the other hand, the war replenished the coffers of the Pentagon’s contractual partners: in four years, Halliburton jumped from half a billion to 6 billion dollars worth of contracts and Lockheed Martin harvested 29 billion in one year. Major deals were also in store for private military businesses: in 2003 in Iraq there were more "contractors" than military personnel. The human cost for the US was estimated at some 6,000 dead in action and more than 500,000 invalids. The number of civilian war casualties reached 125,000 in Irak and 50,000 in Pakistan and Afghanistan.

But these are figures arrived at largely by default: hundreds of thousands of injured and about 8 million refugees continue to die. Out of sight and far from the heart of the great democracies that went to rescue them from the threat of terrorism.