Monday, December 11, 2006

Opinion (Kevin Hassett): Time to Face Facts About Surging Iraq War Costs

The Iraq Study Group

Dec. 11 (Bloomberg) -- The report by the Iraq Study Group added fuel to the fiery foreign and defense-policy debate last week. But it also focused the attention of budget experts on the past and future costs of the war.

As one pores through the spending numbers, one thing is clear: The costs will be steep no matter what. The open question is, will Congress continue to act as if that doesn't matter?

While opinions differ sharply on the best way to help Iraq make the transition to an acceptable future, there is fairly broad agreement among economists about the numbers. One can project with some precision the different possible budget paths that would occur depending on whether the war goes well or continues to go poorly. Those different paths could have an enormous impact on our fiscal future.

Lee Hamilton, co-chairman of the Iraq Study Group, suggested last week that the costs of the war may rise to more than $1 trillion.

Read the rest at Bloomberg