The great unknown: How to pay for war in Iraq

By Herbert Winkler, dpa

Washington (dpa) - As soon as the heated debate about the looming war in Iraq is steered toward the cost of such a military operation, the U.S. administration remains tight-lipped.

"It's impossible to have a global number or an estimate for it because that all depends on what the outcome is,'' Ari Fleischer, spokesman for U.S. President George W. Bush, keeps saying.

But experts agree that the sum will be astronomical and will far exceed the 76.1-billion-dollar cost of Desert Storm after adjusting for inflation.

No doubt, the United States will need its allies to pitch in. The Bush administration is already in debt and will be insolvent by early April if Congress does not raise the government's credit limit for the second time in nine months, this time to 6.4 trillion dollars.

But its allies won't stand in line to fork over money for war this time around. During the 1991 invasion of Iraq, Washington paid 12 per cent, or 7 billion dollars, of the total cost. Saudi Arabia footed 29 per cent of the bill, while Kuwait helped with 26 per cent, Germany with 16 per cent, Japan with 10 per cent and Great Britain with 7 per cent of the cost.

Iraq's oil riches won't come into play until later to refill the war and reconstruction coffers, even if the war is successful.

If Iraqi President Saddam Hussein's followers set the country's oil fields on fire, there is no telling what the consequences would be. U.S. officials estimate restoration of burned oil fields alone would put a 10-billion-dollar dent into the checking account.

Another great unknown is the Iraqi opposition, which reacted angrily to proposed U.S. plans to rid the country only of the ruling elite while keeping in place middle- and lower-ranking officials to rebuild the country after a war.

If Kurds and Shiites react similarly as warlords did in Afghanistan, peace could be far off in Iraq.

Officials, think tanks and experts estimate that a brief military campaign with 250,000 soldiers would cost between 40 billion and 60 billion dollars. Postwar measures would make the bill skyrocket to 100 billion to 200 billion dollars.

Military economist Michael O'Hanlon said the United States would be left with an annual payment of up to 20 billion dollars for multilateral troops even if allies paid for two-thirds of the expenses.

"Leaving aside immediate humanitarian needs, which will be massive, reconstruction will take between 25 [billion] and 100 billion dollars,'' said a report by an expert group led by former ambassador and Middle East pundit Edward J. Djerejian.

Repairs for existing installations for oil exports will require another 5 billion dollars and reconstruction of the power network could cost 20 billion.

It will take 18 months to three years before the oil industry would reach its production of the early 1990s of 3.5 million barrels a day.

Humanitarian aid will also be a massive financial burden, even before reconstruction is feasible.

Human Rights Watch predicted that a war could displace another 2 million Iraqis, 1.1 million within the country and 900,000 to neighbouring countries. Iraq already has up to 1 million refugees within its borders and 1 million to 2 million abroad, according to the United Nations. The majority of the population depends on a central distribution system that would be severely handicapped during a war.

It would be the U.S. military's job to provide food and repair the infrastructure in the beginning stages. Retired General Jay M. Garner, a veteran of the first Gulf War, heads the Pentagon office responsible for that task. He reports to General Tommy Franks, commander of U.S. troops in the Gulf.

The U.N. estimates that more than 14 million Iraqis would depend on foreign aid in the event of war. But whether the Pentagon is capable of supplying that kind of aid is yet another question mark, as is the duration of such an operation.

Douglas Feith, undersecretary of defence for policy, said during a congressional hearing that he couldn't even begin to estimate how long it would take.

And a bipartisan commission found that Washington is "woefully'' unprepared for the Herculean task of reconstruction in Iraq. The commission identified 17 weaknesses, ranging from a lack of central planning to finance models.

dpa hw vb ls AP-NY-02-20-03 2012EST

Copyright (c) 2003 dpa Deutsche Presse-Agentur GmbH
Received by NewsEdge Insight: 02/20/2003 20:13:13


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