The costs of the Iraq war are officially estimated around $500 billion, a sum which may be compared to the one spent in the Korea and Vietnam wars. However, this is likely to be less than half of the war’s real economic cost. If proper accounting principles are adopted, reasonable estimates lie between $750 and $1269 billion - or between 6% and 10% of America’s GDP. Taking other economic costs into account, such as the medical costs borne by seriously injured soldiers, the loss of income produced by reservists on duty, and increases in oil price and greater uncertainty, adds $380 to $1400 billion in present value terms. SourceHow would a Social Policy Bond regime deal with violent political conflict? In the first place, it would clarify, and make explicit, objectives. Under the current regime, those who initiate armed conflict may have very different goals from their stated intentions.
Second, issuing Social Policy Bonds necessitates estimating and capping of the maximum cost to society of achieving the targeted goals.
Third, Social Policy Bonds would not assume that armed conflict is the best way of achieving such stated goals. The Iraq war appears to be an example of a typical government response to a perceived threat. Let’s say the actual agenda of the conflict was regime change and the installation of a democratic government over the whole of a politically united Iraq. Does anyone seriously believe that contracting out these goals to the market would be as costly – to everybody and in every sense – as the current conflict? War seems to be very much like the ludicrous subsidy programmes, or the crazy construction schemes that characterise so much of big government: real people don’t want it, but it goes ahead anyway because of (1) the power of corporate interests and (2) the obsessive need of government bodies to retain control.
● An fascinating article by George Monbiot in the Ecologist ends by asserting that ‘there’s one obvious question with which every journal and journalist should begin: “who is funding you?”’ I can answer this question accurately and concisely: nobody. If I were to say that this is because there’s no money for original policy ideas or outcome-based policy, but only for vested interests and ideologues I’d be accused of being bitter and twisted, so I shan’t say it, even if it’s true – which it is.