The Us Government Opportunity Costs For Fighting The Global War On Terror
Introduction
The global war on terror is responsible for the current problems in the US economy.
This war began after the fateful September eleventh bombings. These bombings were the major reason that President Bush gave for invading Iraq. However, he somehow managed to change these objectives into others thus bringing about a longer occupation of Iraq. Some experts have suggested that the US's economic problems have been a direct casualty of this global war on terror owing to opportunity costs that the US government forewent in order to pursue the global war on terror. The essay seeks to explore the validity of these statements and whether the US economic crisis has been linked to these problems. (Belasco, 2007)
The opportunity costs
Macro economic opportunity costs.
Opportunity costs of the global war on terror are crucial because they give an insight into other alternatives that the government would have sought if they had not invested in the war. They are also a means of measuring the effect of the measured direct costs of the war. The global war on terror has had serious implications on expenditure patterns in the country owing to the fact that some local expenditures had to be foregone. This has eventually reduced the public's perception of their well being.
Additionally, the global war on terror has caused the US government to reduce the amount of expenditure that they dedicate to economic investments. For instance, the US government has had to reduce the amount they spent on construction of residential buildings. They have also reduced the expenditure on health and education within the country. Investments in fixed businesses and also in infrastructural facilities have been much lower than they were before the global war on terror. It is particularly alarming that the global war on terror has caused a reduced investment in health because this is a crucial sector of the US economy. If people within the country cannot access quality health facilities or services, then they are likely to have lower living standards. This impacts on the GDP very negatively.
According to the Congressional Budget Office, the United States government has dedicated six hundred and fifty one billion dollars on the global war on terror between 2001 and 2007. It should be noted that these estimates do not incorporate what has happened this year. Additionally, many other experts assert that this is a large under estimation. In fact, they argue that these are merely direct costs. (Chernick, 2006)
The Congressional budget estimates were derivatives of what the US government has spent on disability compensation, military operations, survivor benefits and medical costs. As it can be seen there is no mention of opportunity costs because if the same finances would have been invested in other sectors of the economy they would have yielded substantial returns. Analysts have identified areas such a building infrastructural facilities, funding scientific and social research or providing aid to needy countries. In other articles, analysts have even attempted to place a number on the opportunity cost of the war. One such example can be seen in the book the Trillion Dollar war which states that the government has wasted one trillion in form of the foregone opportunity costs. The following are some of the issues that have dealt a blow on the US economy due to the global war on terror;
The Global War on Terror has been possible as a direct result of debt funding. One cannot ignore the negative connotations that come with debt financing because they cause increased inflationary pressures and they also affect prevailing interest rates in the financial market. The US government managed to deal with debt arising from the Global war on terror through the proceeds of debt selling to foreign markets. However, the feasibility of this approach in the twenty first century has been questioned and there are high chances of redirecting those costs to the ordinary American. (Belasco, 2007)
One particular area that depicts just how much the global war on terror has affected the American people negatively is with regard to prices of resources. The most outstanding and affected one is the soaring price of oil. The US is currently suffering a problem with gas pieces owing to a number of internal and external factors. The external factors are related to the consistent war and political instability in these oil-rich countries; one of them is Iraq. Thanks to the global war on terror, one of the world's leading oil exporters has been hampered from providing this precious commodity to the world market. An internal factor that could have caused these rising fuel prices is related to the amount of money dedicated towards the war that would have been redirected to the provision of gas to American consumers. As if to add insult onto injury, large international oil corporations are making so much out of oil owing to its scarcity. Experts assert that the US is not faced with a fuel shortage as such; instead it is faced with poor leadership. This poor leadership has concentrated on things that of affect the economy positively.
Human opportunity costs
One cannot ignore the effects that the global war on terror had on numerous US citizens who chose to fight the war directly. Estimates indicate that over three thousand five hundred US soldiers have died from the global war on terror. There is no way that one could estimate the positive impacts that these individuals would have brought onto the US economy if they were still alive. As if this is not enough, the global war on terror wounded over twenty six thousand US soldiers. These soldiers would have committed a substantial level of their efforts towards other economically productive activities in the country. (Belasco, 2007)
It should also be noted that the global war on terror also affected the Iraqis which the government had claimed to protect in the war. The war caused two million Iraqis to be displaced, it also led to the death of hundreds of thousands of Iraqis. Consequently, these deaths have shown that the US government dedicated significant resources to a war that caused more harm before than after it had occurred both within the country and outside.
Military opportunity costs
The war on terrorism could have been tackled in a different way militarily thus representing the opportunity cost that the country has foregone by choosing the path that they did. The government needed to reprioritize some of the issues that took precedence in the global war on terror. For instance, the government would have dedicated more finances towards homeland security so as to prevent future terrorist threats. The country itself is still vulnerable in this area.
Additionally, the US Government could have chosen to partner with Afghanistan by giving them aid. This would foster economic development and would also encourage democracy since one cannot receive grants or loan if they don't adhere to democratic principles. By adhering to this, the government would have ensured that there is no need for illegal activities in Iraq or Afghanistan. It should be noted that drug warlords and other similar economic activities have funded most of the terrorist activities in the latter countries. (Chernick, 2006)
Experts have claimed that the six hundred and fifty five billion dollars spent on the global war on terror could have been administered in a better way. For example, the government could have dedicated more towards protecting US ports. The government's war on terror has been targeting the wrong areas; Iraq and Afghanistan since only half a million dollars has been directed towards protecting US ports. US laws themselves stipulate that one requires seven point five billion to secure ports. If the government had focused a little more on this then the global war on terror would have yielded a better return on the country's investments.
Besides that, the global war on terror should also have been concentrated on checking cargo security. If the US government prevented illegal commodities from entering the country, then it could reduce this terrorism threat. On top of that, it also possible that the global war on terror would have been made more feasible by eliminating some security threats prevalent within the international market. There are some shoulder fired missiles threatening the US as a country. If the government dedicated around ten billion towards countering those missiles in the black markets, then they would have effectively prevented future threats. Shown below is a summary of what the government could have done within the military to deal with global terrorism. All these approaches concentrate on other areas of security other than Afghanistan or Iraq(Pan et al, 2008)
Suggested military expenditures to heighten success of global war on terror
Venture No.
Venture
Costs (billion of US dollars)
1
Safeguarding ports
7.5
2
Upgrade Coast fleets
4
3
Cargo security improvement
2
4
shoulder fired missiles
10
5
Baggage screening devices
5
6
Airport explosive detectors
0.24
7
Increasing local police
7
8
Fire department funding
2.5
9
Radio systems emergencies
0.35
10
Securing roads
3
11
Secure nuclear material
30.5
12
Nunn Lugar funding
2.25
13
Army divisions
24
14
Special operations troops
15.5
15
Rebuild Afghanistan
8.6
16
Stop Afghanistan's opium
11
17
Increasing aid in Middle East
10
18
Increase public diplomacy
0.78
(Pan et al, 2008)
The graph above shows the potential military investments that the US government should have considered instead of taking on Iraq and Afghanistan head on. These would have played a great role in undermining their terrorist activities.
Conclusion
Owing to the fact it is rather difficult trying to measure the overall effect of the global war on terror with conventional metrics, then many people have resorted to expert opinions as suitable indicator of the feasibility, economic implications and opportunity costs of the war. Almost eighty percent of experts on this matter assert that the US government made a big mistake in fighting the global war on terror. This is because the country has not won the war and has also contributed to immense levels of suffering among citizen in the country.
The truth of the matter is that the global war on terror resulted in concentration of military activities yet these would have otherwise been directed towards other significant economic opportunities. For instance, the issue of soaring gas prices would not have been prevalent if the government had not participated in the war. As if that is not enough, the global war on terror could have been tackled in a different manner so as to achieve greater outcomes. Besides that, it resulted in human related costs that would have benefited the country today and in the future.
Reference
Pan, M. Crowley, A. and Robert, B. (2008): The opportunity cost of the Iraq War; Centre for American Progress Report, No. 825
Belasco, A. (2007): The Cost of Iraq, Afghanistan and Other Global War on Terror Operations; No. RL33110CRS Report for Congress, 14th March
Chernick, H. (2006): The Economic Impact of 9/11; Russell SageFoundation, 2005
The global war on terror is responsible for the current problems in the US economy.
This war began after the fateful September eleventh bombings. These bombings were the major reason that President Bush gave for invading Iraq. However, he somehow managed to change these objectives into others thus bringing about a longer occupation of Iraq. Some experts have suggested that the US's economic problems have been a direct casualty of this global war on terror owing to opportunity costs that the US government forewent in order to pursue the global war on terror. The essay seeks to explore the validity of these statements and whether the US economic crisis has been linked to these problems. (Belasco, 2007)
The opportunity costs
Macro economic opportunity costs.
Opportunity costs of the global war on terror are crucial because they give an insight into other alternatives that the government would have sought if they had not invested in the war. They are also a means of measuring the effect of the measured direct costs of the war. The global war on terror has had serious implications on expenditure patterns in the country owing to the fact that some local expenditures had to be foregone. This has eventually reduced the public's perception of their well being.
Additionally, the global war on terror has caused the US government to reduce the amount of expenditure that they dedicate to economic investments. For instance, the US government has had to reduce the amount they spent on construction of residential buildings. They have also reduced the expenditure on health and education within the country. Investments in fixed businesses and also in infrastructural facilities have been much lower than they were before the global war on terror. It is particularly alarming that the global war on terror has caused a reduced investment in health because this is a crucial sector of the US economy. If people within the country cannot access quality health facilities or services, then they are likely to have lower living standards. This impacts on the GDP very negatively.
According to the Congressional Budget Office, the United States government has dedicated six hundred and fifty one billion dollars on the global war on terror between 2001 and 2007. It should be noted that these estimates do not incorporate what has happened this year. Additionally, many other experts assert that this is a large under estimation. In fact, they argue that these are merely direct costs. (Chernick, 2006)
The Congressional budget estimates were derivatives of what the US government has spent on disability compensation, military operations, survivor benefits and medical costs. As it can be seen there is no mention of opportunity costs because if the same finances would have been invested in other sectors of the economy they would have yielded substantial returns. Analysts have identified areas such a building infrastructural facilities, funding scientific and social research or providing aid to needy countries. In other articles, analysts have even attempted to place a number on the opportunity cost of the war. One such example can be seen in the book the Trillion Dollar war which states that the government has wasted one trillion in form of the foregone opportunity costs. The following are some of the issues that have dealt a blow on the US economy due to the global war on terror;
- Increasing budgetary deficits linked to the war in Iraq and Afghanistan
- Increasing cost of fuel; the cost directly linked to the war are five dollars for every barrel
- Debt repayments caused by getting loans to finance the war
The Global War on Terror has been possible as a direct result of debt funding. One cannot ignore the negative connotations that come with debt financing because they cause increased inflationary pressures and they also affect prevailing interest rates in the financial market. The US government managed to deal with debt arising from the Global war on terror through the proceeds of debt selling to foreign markets. However, the feasibility of this approach in the twenty first century has been questioned and there are high chances of redirecting those costs to the ordinary American. (Belasco, 2007)
One particular area that depicts just how much the global war on terror has affected the American people negatively is with regard to prices of resources. The most outstanding and affected one is the soaring price of oil. The US is currently suffering a problem with gas pieces owing to a number of internal and external factors. The external factors are related to the consistent war and political instability in these oil-rich countries; one of them is Iraq. Thanks to the global war on terror, one of the world's leading oil exporters has been hampered from providing this precious commodity to the world market. An internal factor that could have caused these rising fuel prices is related to the amount of money dedicated towards the war that would have been redirected to the provision of gas to American consumers. As if to add insult onto injury, large international oil corporations are making so much out of oil owing to its scarcity. Experts assert that the US is not faced with a fuel shortage as such; instead it is faced with poor leadership. This poor leadership has concentrated on things that of affect the economy positively.
Human opportunity costs
One cannot ignore the effects that the global war on terror had on numerous US citizens who chose to fight the war directly. Estimates indicate that over three thousand five hundred US soldiers have died from the global war on terror. There is no way that one could estimate the positive impacts that these individuals would have brought onto the US economy if they were still alive. As if this is not enough, the global war on terror wounded over twenty six thousand US soldiers. These soldiers would have committed a substantial level of their efforts towards other economically productive activities in the country. (Belasco, 2007)
It should also be noted that the global war on terror also affected the Iraqis which the government had claimed to protect in the war. The war caused two million Iraqis to be displaced, it also led to the death of hundreds of thousands of Iraqis. Consequently, these deaths have shown that the US government dedicated significant resources to a war that caused more harm before than after it had occurred both within the country and outside.
Military opportunity costs
The war on terrorism could have been tackled in a different way militarily thus representing the opportunity cost that the country has foregone by choosing the path that they did. The government needed to reprioritize some of the issues that took precedence in the global war on terror. For instance, the government would have dedicated more finances towards homeland security so as to prevent future terrorist threats. The country itself is still vulnerable in this area.
Additionally, the US Government could have chosen to partner with Afghanistan by giving them aid. This would foster economic development and would also encourage democracy since one cannot receive grants or loan if they don't adhere to democratic principles. By adhering to this, the government would have ensured that there is no need for illegal activities in Iraq or Afghanistan. It should be noted that drug warlords and other similar economic activities have funded most of the terrorist activities in the latter countries. (Chernick, 2006)
Experts have claimed that the six hundred and fifty five billion dollars spent on the global war on terror could have been administered in a better way. For example, the government could have dedicated more towards protecting US ports. The government's war on terror has been targeting the wrong areas; Iraq and Afghanistan since only half a million dollars has been directed towards protecting US ports. US laws themselves stipulate that one requires seven point five billion to secure ports. If the government had focused a little more on this then the global war on terror would have yielded a better return on the country's investments.
Besides that, the global war on terror should also have been concentrated on checking cargo security. If the US government prevented illegal commodities from entering the country, then it could reduce this terrorism threat. On top of that, it also possible that the global war on terror would have been made more feasible by eliminating some security threats prevalent within the international market. There are some shoulder fired missiles threatening the US as a country. If the government dedicated around ten billion towards countering those missiles in the black markets, then they would have effectively prevented future threats. Shown below is a summary of what the government could have done within the military to deal with global terrorism. All these approaches concentrate on other areas of security other than Afghanistan or Iraq(Pan et al, 2008)
Suggested military expenditures to heighten success of global war on terror
Venture No.
Venture
Costs (billion of US dollars)
1
Safeguarding ports
7.5
2
Upgrade Coast fleets
4
3
Cargo security improvement
2
4
shoulder fired missiles
10
5
Baggage screening devices
5
6
Airport explosive detectors
0.24
7
Increasing local police
7
8
Fire department funding
2.5
9
Radio systems emergencies
0.35
10
Securing roads
3
11
Secure nuclear material
30.5
12
Nunn Lugar funding
2.25
13
Army divisions
24
14
Special operations troops
15.5
15
Rebuild Afghanistan
8.6
16
Stop Afghanistan's opium
11
17
Increasing aid in Middle East
10
18
Increase public diplomacy
0.78
(Pan et al, 2008)
The graph above shows the potential military investments that the US government should have considered instead of taking on Iraq and Afghanistan head on. These would have played a great role in undermining their terrorist activities.
Conclusion
Owing to the fact it is rather difficult trying to measure the overall effect of the global war on terror with conventional metrics, then many people have resorted to expert opinions as suitable indicator of the feasibility, economic implications and opportunity costs of the war. Almost eighty percent of experts on this matter assert that the US government made a big mistake in fighting the global war on terror. This is because the country has not won the war and has also contributed to immense levels of suffering among citizen in the country.
The truth of the matter is that the global war on terror resulted in concentration of military activities yet these would have otherwise been directed towards other significant economic opportunities. For instance, the issue of soaring gas prices would not have been prevalent if the government had not participated in the war. As if that is not enough, the global war on terror could have been tackled in a different manner so as to achieve greater outcomes. Besides that, it resulted in human related costs that would have benefited the country today and in the future.
Reference
Pan, M. Crowley, A. and Robert, B. (2008): The opportunity cost of the Iraq War; Centre for American Progress Report, No. 825
Belasco, A. (2007): The Cost of Iraq, Afghanistan and Other Global War on Terror Operations; No. RL33110CRS Report for Congress, 14th March
Chernick, H. (2006): The Economic Impact of 9/11; Russell SageFoundation, 2005
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