$2 Trillion or Not $2 Trillion?

War on Iraq Will Cost $2 Trillion!
Current moderate estimates for the cost of the war in Iraq: $2 Trillion!

Reuters reports this total, which is far above the US administration's prewar projections which rejected an early figure of $100-200 billion. A new study by Columbia University economist Joseph E. Stiglitz, who won the Nobel Prize in economics in 2001, and Harvard lecturer Linda Bilmes concludes that the total costs of the Iraq war could top the $2 trillion mark.

Even taking a conservative approach, we have been surprised at how large they are," the study said, referring to total war costs. "We can state, with some degree of confidence, that they exceed a trillion dollars."

Third World Debt
The foreign debts of developing nations are growing at an uncontrollable and unserviceable rate. For all Third World countries debts have risen from $610 billion in 1980 to $2.3 trillion in 1997.

This means an annual average increase of 8.2%. Now, over the same period of time the average annual economic growth of these same nations has risen by 5%. Statistics like these demonstrate a debt growth in excess of economic growth, reducing the ability of nations to pay back debt.

Amount US owes to the United Nations
The UN has always had problems with members refusing to pay the assessment levied upon them under the United Nations Charter. But the most significant refusal in recent times has been that of the U.S. For a number of years the U.S. Congress refused to authorize payment of the U.S. dues, in order to force UN compliance with U.S. wishes, as well as a reduction in the U.S. assessment.

U.S. arrears to the UN currently total over $1.3 billion. Of this, $612 million is payable under Helms-Biden. The remaining $700 million result from various legislative and policy withholdings; of course, there are no current plans to pay these amounts.


The Cato Institute Disagrees
Despite the fact that news articles routinely discuss the U.S. debt to the United Nations, no such debt exists. Assertions about this nonexistent debt ignore the billions of dollars of military and other assistance that has been provided to the world organization but neither properly credited nor reimbursed to the United States; they divert attention from the administration's policy of providing resources, personnel and equipment to the UN without the approval of Congress.