How Americans were swindled by the hidden cost of the Iraq war
George Bush sold the war as quick and cheap; it was long and costly. Even now, the US is paying billions to private contractors
When the US invaded Iraq in March 2003, the Bush administration estimated that it would cost $50-60bn to overthrow Saddam Hussein and establish a functioning government. This estimate was catastrophically wrong: the war in Iraq has cost $823.2bn between 2003 and 2011. Some estimates suggesting that it may eventually cost as much as $3.7tn when factoring in the long-term costs of caring for the wounded and the families of those killed.
The most striking fact about the cost of the war in Iraq has been the extent to which it has been kept "off the books" of the government's ledgers and hidden from the American people. This was done by design. A fundamental assumption of the Bush administration's approach to the war was that it was only politically sustainable if it was portrayed as near-costless to the American public and to key constituencies in Washington. The dirty little secret of the Iraq war – one that both Bush and the war hawks in the Democratic party knew, but would never admit – was that the American people would only support a war to get rid of Saddam Hussein if they could be assured that they would pay almost nothing for it.
The most obvious way in which the true cost of this war was kept hidden was with the use of supplemental appropriations to fund the occupation. By one estimate, 70% of the costs of wars in Iraq and Afghanistan between 2003 and 2008 were funded with supplemental or emergency appropriations approved outside the Pentagon's annual budget. These appropriations allowed the Bush administration to shield the Pentagon's budget from the cuts otherwise needed to finance the war, to keep the Pentagon's pet programs intact and to escape the scrutiny that Congress gives to its normal annual regular appropriations.
With the Iraq war treated as an "off the books" expense, the Pentagon was allowed to keep spending on high-end military equipment and cutting-edge technology. In fiscal terms, it was as if the messy wars in Afghanistan and Iraq were never happening.
More fundamentally, the Bush administration masked the cost of the war with deficit spending to ensure that the American people would not face up to its costs while President Bush was in office. Despite their recent discovery of outrage over the national debt, the Republicans followed the advice of Vice-President Dick Cheney that "deficits don't matter" and spent freely on domestic programs throughout the Bush years. The Bush administration encouraged the American people to keep spending and "enjoy life", while the government paid for the occupation of Iraq on a credit card they hoped never to have to repay.
Most Americans were not asked to make any sacrifice for the Iraq war, while its real costs were confined to the 1% of the population who fought and died there. As a result, the average American was never forced to confront whether pouring money borrowed from China into the corrupt Iraqi security services was worth it, or whether it made more sense to rebuild infrastructure in Diyala, rather than, say, Philadelphia.
One consequence of the way that the true costs of the Iraq war was hidden from the American people was an explosion of fraud, waste and abuse. The recent final report of the Special Inspector General for Iraq Reconstruction (Sigir) estimates that the US lost to corruption or waste at least $8bn of the $60bn devoted to reconstructing Iraq.
Much of the reconstruction expense had no useful political effect: as Spencer Ackerman has pointed out, Iraqi officials cannot point to a single completed project that the US managed during the course of the occupation. The hundreds of ill thought-out projects and half-baked ideas that marred the American reconstruction effort provides a powerful explanation for why the US campaign for "hearts and minds" never worked, and why Iraq is hardly a pro-American bastion in the Middle East today.
An occupation conducted through under-scrutinized emergency appropriations enabled dozens, if not hundreds, of private companies to act like pigs at the trough – wasting taxpayer dollars on frivolous expenses while the insurgency raged around them. These private companies were able to behave so rapaciously because they were so desperately needed by the US government to run the Iraq war without revealing its true cost to the American public.
Another factor that was kept hidden from the American public was the skyrocketing costs of deploying US troops abroad. According to a Congressional Research Service estimate (pdf), the average annual operational cost per US soldier in Iraq was $462,000 between 2005 and 2009. To control costs and avoid imposing a draft, the US resorted to a parallel army of private contractors, numbering 100,000 people or more at the height of the war.
Yet, this policy backfired, as private contractors cost nearly as much and wasted millions – by one estimate, losing $12m a day between the wars in Iraq and Afghanistan. The only advantage they had was that they allowed the American people to be lulled into thinking that the Iraq war had cost them nothing.
The extent to which the US hid the costs of the war by relying on private contractors has left a disastrous legacy within Iraq itself. Many of these contractors behaved recklessly; sometimes, they even shot at crowds when they felt trapped or threatened. Thus private military contracting help to turn the population even more against the US and the occupation.
Even after the US withdrawal, Iraq has had to contend with dozens of private security companies, many still under US contract, running operations in contravention of Iraqi law. An estimate in February 2012 revealed there were 109 separate private security companies, with 36,000 men under arms, still operating in Iraq months after the American army had gone home. While US attention has drifted from Iraq, the costs of this reckless war are still being incurred. The American embassy in Baghdad remains a heavily-armed fortress: a relic of the imperial ambitions that the US had in that country.
Through 2012, the US is projected to have spent $17.7bn (pdf) on police training and civilian reconstruction projects in Iraq. This at a time when hundreds of states and towns across the US face harsh budget cuts in essential services and care for their poor and sick.
The Iraq war provides many lessons, but among the most important is that the promise of a cheap and easy war never turns out to be true. The Bush administration sold the American people a bill of goods with Iraq, offering them a short and glorious war while secretly running up a tab that future generations will be left with. Along with Afghanistan, the war in Iraq added $1.4tn to the national debt.
The dishonesty of this approach is due to a fundamental fact about the United States: that while its leaders may have grand international ambitions, most Americans have no appetite for, or interest in, nation-building abroad. This mismatch between our leaders and ourselves means that our politicians will lie to us about running their wars on the cheap while finding ways to pass on the costs to those not yet born. That lesson should be remembered by any American who sees a future president promise, as George Bush did, that such embarking on such a conflict today will "lift a terrible threat from the lives of our children and grandchildren".
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