diet coke for breakfast

Thursday, September 25, 2003

Posted by Jake
Iraq costs require some perspective -- By Larry Lindsey

Kevin Patrick at contributed this link:

The cost to defeat Saddam was less than half a percent of America's annual income (measured as gross domestic product). If spending continues at the current pace, our involvement could cost us 0.4% of our income for the rest of this year. If President Bush's request for $87 billion for Iraq and Afghanistan is approved, the cost of these two fronts will amount to about 0.8% of our income next year...

But what does that really mean? Each year American households spend about 1% of their income on alcoholic beverages and another 1% on tobacco products. We spend about 0.7% of our money on cosmetic products. In other words, our combined operations to combat terror in the Middle East cost a bit more than we spend on makeup and shampoo and a bit less than we spend on booze or tobacco.

Compare this for a second to the huge amount lost when the economy went into recession. This was not entirely the result of 9/11, but I think most people would agree that persistent fears of terrorism at least had something to do with the recession lasting so long.

The question is not how much it will cost to carry out this war. The question is how much cheaper it will be if we do it well.


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