The Cost Of Conflict.(World Affairs; Interview)(Joseph E. Stiglitz and Linda J. Bilmes)(Interview)

Byline: Rana Foroohar

Nobel laureate Joseph Stiglitz says that the war in Iraq will add up to $3 trillion, as the meter ticks on.

Before America invaded Iraq, officials in the Bush administration estimated that the war might cost tens, at most hundreds, of billions of dollars. Nobel Prize-winning economist Joseph E. Stiglitz and Linda J. Bilmes of Harvard's Kennedy School lay out very different figures in their new book, "The Three Trillion Dollar War: The True Cost of the Iraq Conflict." In it, they tally data on everything from troop pay to equipment to veteran's entitlements to larger social and economic costs, and examine how mismanagement, opaque accounting, and the privatization of conflict have resulted in a megabill that Americans could be paying back for the next half-century. Stiglitz recently spoke with NEWSWEEK's Rana Foroohar. Excerpts:

NEWSWEEK: How much is $3 trillion over the course of 50 years? What else could the U.S. have done with that money?

Stiglitz: You can look at it and say, "This is a small percentage of a rich economy," or you can look at things like the proposed children's health-insurance program that was recently vetoed as too expensive--that can be measured in the cost of days of fighting in Iraq. Funding for a major autism research effort is equal to hours of fighting. Bush has said there's a "giant hole" in our Social Security program, but for one sixth the cost of the war in Iraq, we could have fixed Social Security for the next 50 to 75 years.

Why are your numbers so much higher, not only than what the administration came up with, but than your own initial 2006 estimates of $1 trillion to $2 trillion?

The war has gone worse than people thought it would, and it has gone on for much longer. Things like the cost of recruitment have gone up because the war has gone so badly. There's more use of private contractors--there are security guards that get $1,000 per day, and we also pay for the insurance on these people. There are also ambiguities in accounting. For example, if the first tank in a convoy is blown up, that counts as a military loss, but if the second one crashes into the first, it's called something else, and doesn't get tallied in the defense budget. But taxpayers still foot the bill.