- Days left

Where has all your money gone? To a little place called Iraq...

×

Recently, I came across an interesting figure. Congressional analysts estimate that the United States is currently spending $12 billion a month on its overseas wars. According to Joseph Stiglitz and Linda Bilmes, co-authors of The Three Trillion Dollar War, an analysis of the U.S. interventions in Iraq and Afghanistan, the conflicts and subsequent occupations will end up costing the United States between $1.7 and $2.7 trillion dollars by 2017.

Frankly, I can't even imagine that much money. To be honest, I can't even wrap my mind around the buying power of $12 billion! Still, as we're nearing tax time, and as we're debating the cost of our upcoming "Economic Stimulus Package," I started to think about how much money $12 billion is. For research, I decided to check out a few other government programs to compare the relative cost of this war.

Of course, everybody's favorite foil for the military is education, so I decided to start there. While federal funding for education covers only 12% of the total cost, it is still quite significant. According to the Department of Education, Federal educational spending for school year 2007-2008 is $68.6 billion, or just over 46% of the yearly cost of the wars. To give another comparison, in 2007, the United States total spending on highways was $39.6 billion, or roughly 27.5% of the money spent on the two wars in the same period.

To give you an idea of how much money this war is siphoning out of your pocket, keep in mind that our gargantuan economic stimulus package is running $168 billion, $110 billion of which is going to individuals and families. Even if considering the overall cost, this major package is only $24 billion more than America is going to spend on the wars in 2008. Considering the actual part that's going to real people, the economic stimulus package is actually $34 billion less than the cost of the current wars.

In 2003, not long after the Iraq war began, Defense Secretary Donald Rumsfeld stated that "When it comes to [Iraq's] reconstruction, before we turn to the American taxpayer, we will turn first to the resources of the Iraqi government." His statements were amplified by his Deputy Defense Secretary, Paul Wolfowitz, who said, "The oil revenues of [Iraq] could bring between $50 and $100 billion dollars over the course of the next two or three years [...] we are dealing with a country that can really finance its own reconstruction and relatively soon."

Wolfowitz was surprisingly prescient. In fact, Iraq is currently exporting over 1.9 million barrels of oil per day. In 2007, that generated $41 billion, and it has already generated $9.4 billion this year. However, this money is not going to pay for Iraq's reconstruction; instead, it appears to be sitting in non-Iraqi banks. Recently, Senators Carl Levin (D-Mich.) and John Warner (R-Va.) asked the Government Accountability Office to review Iraqi oil revenues and reconstruction funding to determine why such a large percentage of these costs are currently being shouldered by American taxpayers.

Seems like a pretty good question.


Increase your money and finance knowledge from home

Goal Setting

Want to succeed? Then you need goals!

View Course »

Introduction to Preferred Shares

Learn the difference between preferred and common shares.

View Course »

TurboTax Articles

Are You Exempt From Health Care Coverage?

The Affordable Care Act, or Obamacare, is an individual mandate that requires all eligible Americans to have some form of basic health coverage by 2014. Those without insurance will receive a penalty when they file their tax returns ? that is, unless they have an exemption. TurboTax's Exemption Check can help you find out whether or not you qualify for an exemption.

Essential Tax Forms for the Affordable Care Act

The Affordable Care Act (ACA), also referred to as Obamacare, affects how millions of Americans will prepare their taxes in the new year. The law now includes penalties for all who haven?t obtained health insurance -- and those penalties are expected to be paid at tax time. The ACA also provides tax credits to help people pay for insurance, and you can claim those credits when you file your taxes. The Internal Revenue Service (IRS) has introduced a number of tax forms to accommodate the ACA.

Mortgage Refinance Tax Deductions

When refinancing a mortgage to get a lower interest rate or obtain more favorable loan terms, you're really just taking out a new loan and using the money to pay off your existing home loan. In general, the same tax deductions are available when you're refinancing a mortgage as when you're taking out a mortgage to buy a home.

How to Determine if You Have Minimum Essential Coverage (MEC)

The Affordable Care Act, also known as Obamacare, requires most Americans to have health insurance that meets a government standard known as "minimum essential coverage," or MEC. Whether your insurance qualifies as MEC depends not on the plan itself, but on how you obtained your coverage.

Rental Property Deductions You Can Take at Tax Time

Rental property often offers larger deductions and tax benefits than most investments. Many of these are overlooked by landlords at tax time. This can make a difference in making a profit or losing money on your real estate venture. If you own a rental property, the IRS allows you to deduct expenses you pay for the upkeep and maintenance of the property, conserving and managing the property, and other expenses deemed necessary and associated with property rental.

Add a Comment

*0 / 3000 Character Maximum