Friday, September 28, 2007

The Political Economy of War

The Washington Post reports that Saddam Hussain was willing to go into exile just before the invasion for a mere $1 billion. Assume that Lawrence Lindsey's $100 billion estimate reflected the administration's optimistic best guess of the cost of war. What do you think the administration thought might have been worth more than the $99 billion difference?

http://www.washingtonpost.com/wp-dyn/content/article/2007/09/26/AR2007092602414.html?sub=AR

8 comments:

  1. Yes, well, and I think, if I remember correctly, that this $100 billion estimate by Lindsey was why he was fired. After all, the Iraqis were going to pay for it all with their oil and gratitude.

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  2. The wars aren't a cost. They are a way of shifting government expenditures from one sector of the economy to another. The nice thing about bombs and expenses for "security" is that they don't leave any messy infrastructure behind.

    So we can continue to spend on these sectors without new bridges and levees impeding future plans.

    The only more efficient scheme would be to dig a hole in the ground and shovel money into it.

    The admin is also funding the wars with borrowed money, so the Chinese are actually paying for it. When the scheme collapses (as it did with Vietnam) it will the problem for the next administration to deal with. The difference between GWB and LBJ is that Johnson knew he had screwed up and had no plan to fix things, and thus left. Bush sails blithely on...

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  3. it's an interesting question.

    back before BushWar I, Saddam offered to leave Kuwaitt, but that was loudly dismissed in the press as a "ploy."

    Now I am not so smart that I can say for sure that it was not a ploy. But after reading the papers for a few dozen years I get the feeling that someone is lying to me.

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  4. My favorite along these lines was the prediction of Bill Kristol about five years ago that this war would cost us no more than 0.2% of GDP (circa $20 billion). Now Mr. Kristol is arguing that he had always advocated a larger military force be sent it than the one we did send in. I guess he thinks a 300,000 man invasion force would have costs us very little. So much for the analytical and forecasting skills of this neocon nitwit.

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  5. pgl,
    Why would Kristol be taken seriously by any serious person? He is nothing more than a commentator, not even up to the level of a journalist. He's a publicist with a serious inclination to being a propagandist. So why does any one even pay him any mind when, in the first place, he talks like a fool with nothing to say, and in the second place he fudges his prior commentary to hide his own stupidity about the world around him. His buddy Georgie Boy expected to spend $50 billion. At least that's what he told his adoring public.

    I'm with Feinman, as I've made clear recently on this site, revenues wasted by our loyal officials is otherwise revenue earned by their close associats in the war making industry. KBR isn't there out of loyalty to the troops. Blackwater isn't dooing its patriotic duty. This is a massive scheme to put money where it's least needed. Unfortunately it's our money that's going in those directions.

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  6. There are a couple of themes at work here.

    US Presidents are overwhelmed by their constitutional role of Commander-in-Chief as they commence their presidencies, wishing to "make their bones" for historical recognition, hopefully with a small war, and be the conquering hero.

    In recognition of the role of the US as superpower, rulers of third world countries design variations on the theme of "The Mouse That Roared" as their means of cashing in on the wealth and largess of the US economy.

    Perhaps if there had been a deal made similar to the one Admiral Dewey had in hand before the battle of the Philippines (before it got out of hand), George W could have made his bones on the cheap and Saddam might have settled down on an oasis with a lot of dates and other goodies.

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  7. Because fraud is a felony.

    Unless you're the president handing out bucks to your war profiteer buddies.

    And we wanted all that "cheap" oil. Which is working out so darn well, isn't it?

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  8. "Hossam Shaltout, a Canadian aerospace engineer, former American pilot, and founder of the peace organization Rights and Freedom International (http://www.rightsandfreedom.com), who said that war could have been averted, but Bush aides blocked
    his efforts to announce Saddam's decision.

    "Saddam was willing to yield to all American demands, announced and unannounced, to reach peaceful
    resolution," said Shaltout, "but the Bush administration, including Elizabeth Cheney, undersecretary
    of State, David Welch, the U.S. ambassador in Egypt, and Gene Cretz, his political attache, did not respond to his offers."

    Shaltout said he was planning to fly from Amman to Baghdad to announce Saddam's decision, but the
    Royal Jordanian Airlines officials claimed that the US ordered the flight to leave five hours earlier causing him to miss the flight, preventing him from announcing on CNN that Saddam would bow to the Bush ultimatum. Shaltout said he traveled by road to Baghdad, delaying him almost one day,
    but raced to get the communique approved from Saddam to broadcast over international TV stations
    broadcasting from Baghdad.

    Couple of hours before the expiration of the Bush ultimatum, Saddam ordered Colonel Amer, his

    strongman, to facilitate Shaltout's broadcast of the communique. Colonel Amer ordered Allaa Mecky,

    the head of the Iraqi Channel 2 television, to accompany Shaltout and help him broadcast the communique."

    It was very late at night and CNN in Baghdad was closed. So they went to al-Jazeera, and Shaltout told al-Jazeera Washington correspondent Hafez Almirazy on the air that he had the Iraqi government's official reply to the Bush ultimatum. Moments after Mirazy asked him for a brief, the plug was pulled on the transmission. Shaltout has a copy of that interrupted broadcast.

    Shaltout said that when the Americans arrived in Baghdad, he offered his assistance to U.S. military officials. Instead he was arrested by Marines who went to his hotel suite taking his documents.
    Shaltout has the videotape of his arrest, and several supporting documents.
    "

    http://biz.yahoo.com/prnews/061030/nym224.html?.v=44
    Monday October 30, 4:35 pm ET 2006
    (The link no longer works)

    +
    (regarding the very high oil prices in 1974. The extra revenues were used to bail out the US weapon makers)
    ".In May, 1972, Richard Nixon and Henry Kissinger stopped off in Iran and signed a secret agreement which gave the Shah a carte blanche to buy any and all conventional weapons he wanted from the U.S. It was the first and only agreement of its kind, escalating to new heights the means of enforcing the- Nixon Doctrine of policing the world through regional mini-powers under U.S. tutelage (e.g., Iran, Brazil, Indonesia, Nigeria).
    Arguably, it also saved key corporate pillars of the beleaguered U.S. arms industry. Indeed, several U.S. officials, including the ex-ambassador to Saudi Arabia, James E. Akins, recently argued that Kissinger acquiesced in the Shah-led oil price hikes beginning in 1974 to provide Iran with the finances to help out ailing Northrup, McDonnell Douglas, General Dynamics, Boeing, Grumman and Litton Industries. Between the Nixon/ Kissinger trip and the onset of the Iranian Revolution in November, 1978, Iran squandered $19 billion on U.S. arms, with most selections personally tested and approved by the Shah. When the Revolution began, $11 billion more was on order. .
    .
    "

    Business In the Shah's Iran by John Cavanagh
    http://multinationalmonitor.org/hyper/issues/1980/12/cavanagh.html
    The Multinational Monitor
    DECEMBER 1980 - VOLUME 1 - NUMBER 11

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