The US-led war in Iraq affects the whole world. Nobel prize-winning economist, chief economist of the World Bank, Joseph Stiglitz, believes that mankind will suffer direct and indirect losses of six trillion dollars as a result of the war. The amount is comparable with gold and currency reserves of all countries of the world and a half of USA’s annual GDP.
The USA’s spending on military operations in Iraq has already exceeded the expenditure on the war in Vietnam which lasted for 12 years. In addition, the Iraqi campaign has already doubled the cost of the war on the Korean Peninsula.
The repayment of loan costs of military operations in Iraq will make up another trillion dollars for the US authorities. The total spending will thus reach three trillion dollars.
The rest of the world will suffer losses similar to those of the USA – about three trillion dollars as well, the scientist believes. The world will have to suffer such an enormous damage because of oil prices, which continue to grow mainly because of the Iraqi war.
Stiglitz also said that 13 African countries have already reported a three-percent decrease in the income level of their population because of the growing fuel prices. The losses of European and East Asian oil importers already make up over one trillion dollars.
Joseph Stiglitz and Linda Bilmes, a former economic advisor at Bill Clinton’s administration, started studying the spending on the Iraqi war in 2005, when the Congressional Budget Office published a report evaluating the war at $500 billion. The figure seemed to be a suspiciously small amount for such an extensive military campaign.
Stiglitz and Bilmes presented their own report in 2006 evaluating the Iraqi war at about two billion dollars. Nowadays, Stiglitz says that it was a very conservative estimation because he did not want to look absurd, The Guardian wrote.
Joseph Eugene "Joe" Stiglitz (born February 9, 1943) is an American economist and a member of the Columbia University faculty. He is a recipient of the John Bates Clark Medal (1979) and the Nobel Prize in Economics (2001). Former Senior Vice President and Chief Economist of the World Bank, he is known for his critical view of globalization, free-market economists (whom he calls "free market fundamentalists") and some international institutions like the International Monetary Fund and the World Bank. In 2000 Stiglitz founded the Initiative for Policy Dialogue (IPD), a think tank on international development based at Columbia University. Since 2001 he has been a member of the Columbia faculty, and has held the rank of University Professor since 2003. He also chairs the University of Manchester's Brooks World Poverty Institute and is a member of the Pontifical Academy of Social Sciences. Stiglitz is among ten most cited economists.
Prepared by Dmitry Sudakov
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