How much has the Iraq war cost?

The U.S. congress is today debating the allocation of a further $94.5 billion for the war in Iraq. This has led me to speculate about how this breaks down in terms of the U.S. taxpayer base. Lots of americans are in favour of the war, but the huge budgetary numbers being tossed around seem disconnected from their actual tax payments.

(Of course, the U.S. is funding this war on debt, but that debt will one day need to be repaid, so for the sake of this back-of-the-envelope calculation, let’s just divide the cost by the number of taxpayers.)

First, we need to know how many taxpayers there are in the states. The IRS publishes tax stats. I used table 3.3 from the “Individual Income Tax Returns Publication 1304” for 2003 (the latest year available). There were 130 million returns, of which 88 931 904 actually paid income tax in a total amount $748 017 488 000.

Regarding cost of the war, getting a good estimate is tough. Very tough. That is because there is politicization of the amount. We know that Bush originally said the war would cost $50 billion. The amount I’ve seen in the news today, seemingly a total of labelled war spending to date is 320 billion dollars. Former World Bank chief economist Joseph Stiglitz has put the ultimate cost, including long term effects on the US economy at 1.026 trillion dollars (839 billion direct costs, and 187 billion in economic damage).

So, how does this work out per taxpayer?

Let’s put this in perspective. The CBC reports the $320 billion US is about 1.5 times the total expenditure of the Canadian government in 2005.

Prefer an american example? According to the US Department of Education there were estimated to be 1 343 000 undergrads graduating in 2006. The money spent to date on the war could have paid for their entire cost of 4 years of education including tuition, room and board.

And you know what? You could do that 4 times over before you ran out of cash… 5.6 million students could be put through their entire 4 year degree for free with just the obvious money that’s been spent so far.

(How did I come up with that? The average tuition room and board cost for a year is $14283, multiplied by a four-year college degree is $57132 per student. The 320 billion divided by $57132 is 5.6 million students put through their entire 4 year degree for free.)

Imagine the effect on the US economy of 5 million highly trained citizens with NO student debt.

I could go on, but I’ve made my point. What would you do with $3500-11000 dollars? Spend it in Iraq?

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› normative     2006-06-15 19:49   ...2