- 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

How much house can I afford

Home buying 101, evaluating one of your most important financial decisions.

View Course »

Economics 101

Intro to economics. But fun.

View Course »

TurboTax Articles

Tax Tips for the Blind

Anyone whose field of vision falls at or below 20 degrees, who wears corrective glasses but whose vision is 20/200 or less in his best eye, or who has no eyesight at all, meets the legal definition of being blind and is eligible for certain tax deductions.

What is Form 4255: Recapture of Investment Credit?

When is a tax credit not a tax credit? When the IRS takes it back. If you're in the situation where you have to file IRS Form 4255, you might have to pay back a tax credit you've earned in prior years. This process, known as recapture, occurs if you claim a credit -- in this case, a credit for a specific type of business investment -- and then no longer qualify for that credit.

The Most Important Tax Forms for ALEs (Applicable Large Employers)

In 2015, some parts of the Affordable Care Act specifically apply to businesses, in particular, large employers. The Employer Shared Responsibility provisions affect companies with 50 or more full-time employees or an equivalent of part-time or seasonal workers. These companies are called Applicable Large Employers, or ALEs. 2015 is considered a transition year as everyone gets used to the new normal for workplace health plans.

Employer Sponsored Health Coverage Explained

The Affordable Care Act, also known as Obamacare, is simpler than some people may give it credit for. The basic rule to remember is that everyone must carry Minimum Essential Coverage (MEC) or pay a penalty. Employers with 50 full-time employees or more are obligated to sponsor plans for their workers to help them meet this requirement.

How to Report RSUs or Stock Grants on Your Tax Return

Restricted stock units (RSUs) and stock grants are often used by companies to reward their employees with an investment in the company rather than with cash. As the name implies, RSUs have rules as to when they can be sold. Stock grants often carry restrictions as well. How your stock grant is delivered to you, and whether or not it is vested, are the key factors when determining tax treatment.

Add a Comment

*0 / 3000 Character Maximum