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Posted at 6:00 AM ET, 04/18/2008

Paying for the Iraq War

By Michael Dobbs


Hillary Clinton, April 17, 2008.

"I think [the war in Iraq] is the first time we've ever been taken to war and had a president who wouldn't pay for it."
--Hillary Clinton, Democratic debate in Pennsylvania, April 17, 2008.

Congress invented the federal income tax in August 1861 to help pay for the Civil War. But is Hillary Clinton correct in claiming that George W. Bush is the first president in American history to refuse to pay for a war that he launched? It is a little more complicated than that.

The Facts

To help me adjudicate this question, I turned to Robert Hormats, a managing director of the financial firm Goldman-Sachs, who has made a detailed study of the financing of American wars in his book, The Price of Liberty. According to Hormats, it is true to say that Bush is unique among U.S. presidents in failing to raise a nickel in extra taxes to pay for the cost of the Iraq war. On the other hand, previous wars were only partially funded by extra taxation, and all resulted in a considerable increase in the national debt.

By Hormats' calculations, 25 percent of the costs of the Civil War were met by taxes. The proportion rises to 33 percent in the case of World War I, and 45 percent for World War II. President Truman, who did not like borrowing, ensured that almost all the costs of the Korean war were funded through increased taxation. It is difficult to give a precise figure for the Vietnam war, as increased taxes came mainly toward the end.

World War II was easily the costliest war in American history, gobbling up 45 percent of America's gross national product. In addition to levying income taxes on everyone earning more than $600 a year, the government raised the rest of the money through war bonds and deficit financing. The federal debt ballooned from 52 percent of Gross Domestic Product in 1940 to 120 percent by the end of the war, the highest in history.

In relative terms, the Iraq war has been fairly cheap by historical standards, costing about $120 billion a year or around one per cent of GDP, compared to 45 percent of GDP for World War II. In absolute terms, however, the Iraq war is the "second most expensive war" in American history after World War II. According to Hormats, it has been financed largely through the issuing of treasury bonds, 40 to 45 percent of which have been bought by foreigners.

The Pinocchio Test

Hillary Clinton is correct in pointing to Bush as the only American president to fail to increase taxes to pay for a foreign war launched on his watch. On the other hand, with the exception of Harry Truman, most previous presidents only partly funded the wars they launched. Clinton has exaggerated the case against Bush by skating over this fact. One Pinocchio.

(About our rating scale.)

By Michael Dobbs  | April 18, 2008; 6:00 AM ET
Categories:  1 Pinocchio, Candidate Watch, History, Iraq  
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Comments

How odd that Americans like to criticize China for not being more active in the Darfur crisis, as if they were actually the cause of it, while we rely on them to buy our war bonds.

Previous war debts were all dissolved in growth and growth depends on 2 things, more people being more productive.

Posted by: shrink2 | April 18, 2008 9:34 AM | Report abuse

What about Obama's big lies during the debate? About the survey with the handwriting, etc.?

Posted by: Mr. Obvious | April 18, 2008 10:03 AM | Report abuse

Please look at Mr. McCain's comments for their veracity the same way you scrutinize and rate Mrs. Clinton's and Mr. Obama's. Surely he has some statements you could hold to the same stringent standards you appear to solely reserve for the Democrats. (Your insipid "Cindy's Recipegate" doesn't count).

Posted by: rdkling | April 18, 2008 10:45 AM | Report abuse

Who do you predict will win the Pennsylvania Democratic Presidential Primary?

http://www.youpolls.com/details.asp?pid=2127


.

Posted by: Frank, Austin | April 18, 2008 10:59 AM | Report abuse

I'm not a huge Hilary fan, but I have to protest giving any Pinocchios for this one, on the basis that the crucial wiggle-words "I think" were at the beginning of Hilary's statement. You can say that she's mistaken. But you can't accuse her of lying (to ANY degree!) unless you can prove she doesn't really think that....

Posted by: B-W | April 18, 2008 11:49 AM | Report abuse

A pity this article doesn't mention the 1991 Gulf War, from which the United States actually made a net profit according to many calculations.

How did the US make a profit from war without plundering? Simple: because the war was a legal UN action, America's military costs were underwritten with vast contributions from other UN member states.

Plus, oh yeah, the US military didn't try to occupy anyone in 1991.

Posted by: OD | April 18, 2008 12:06 PM | Report abuse

B-W:

You are probably still "thinking" about what the meaning of IS is ...

Posted by: Anonymous | April 18, 2008 12:12 PM | Report abuse

I disagree with the Pinocchio because all previous Presidents paid for at least SOME of the war -- making Bush unique in this regard.

Posted by: Ryan | April 18, 2008 2:32 PM | Report abuse

One Pinochio for Fact checker or itys source for neglecting to note that, except for Viet Nam, more than a little of the borrowing was in some form of War or Victory Bond campaigns, where in people were asked to help pay for the war by directly loaning the United States money. THE BORROWING WAS UP FRONT, very public, and specifically touted as America contributing for the war.

George does none of that. Even his borrowing is stealth. The cost of the war is as deeply hidden as it can be. For Hillary merely one half embarrassed Gipetto.

Posted by: ceflynline@msn.com | April 18, 2008 4:37 PM | Report abuse

Don't pay much attention to this guy. He is a Clinton hater from way back' He won't fact check ole Obama on his lies> Occasionally a one or two on his real whoppers. He is one of the MSM Obama protectors right now. He will probably change to McCain later.

Posted by: Chief | April 19, 2008 4:53 AM | Report abuse

ceflynline@msn.com
Fact Checker doesn't let the facts get in the way when fact checking Clintons. He is a Clinton hater from way back. His bias is evident. You have to take his words with a grain of salt. Typical MSM Clinton basher. You would think th WaPo would want an honest Fact Checker wouldn't you. Like the pot calling the kettle black here.

Posted by: Chief | April 19, 2008 5:04 AM | Report abuse

This Video says that the Clintons were a part of the build-up too the Iraq war

http://www.bercasio.com/movies/dems-wmd-before-iraq.wmv

Barack Obama was right with his analogy ,
They all were wrong , so why should they, " The Clintons " , have another shot at the Highest Office in the Land ??

Posted by: AJ Mesa , AZ | April 19, 2008 4:43 PM | Report abuse

The Constitution assigned the responsibility to declare war to Congress and for 200 yrs. when lives were on the line, Congress did it's job. We all know the war was a mistake now, but the bigger problem is Hillary and 72 other Senators without the backbone to do their job. What if Hillary were President and refused to do that job as well.

Posted by: will | April 19, 2008 7:40 PM | Report abuse

"Please look at Mr. McCain's comments for their veracity the same way you scrutinize and rate Mrs. Clinton's and Mr. Obama's."

************

They will be happy to, as soon as the democrats nominate someone and we can finally move on to the general election. Trust me, republicans are itching to get started. For now, however, the democrats are busy fighting a battle amongst themselves, a battle which was supposed to be the real "super bowl" (if democratic predicitons were to be believed) so why shouldnt the MSM pay more attention to obama and clinton than mccain? you want scrutiny of mccain then finish your silly and catty nomination fight.

"pity this article doesn't mention the 1991 Gulf War, from which the United States actually made a net profit according to many calculations.

How did the US make a profit from war without plundering? Simple: because the war was a legal UN action, America's military costs were underwritten with vast contributions from other UN member states.

Plus, oh yeah, the US military didn't try to occupy anyone in 1991."

*********

Ummm...whats your point? only fight wars if they dont cost money? theres nothing that worth you sacrificing your lattes for?

Posted by: Anonymous | April 20, 2008 5:04 PM | Report abuse

On an Obama conference call with reporters Saturday, Gen. Walter Stewart said Clinton's misstatements about her trip to Bosnia as first lady mean she "lacks the moral authority" to lay a wreath at the Tomb of the Unknowns at Arlington National Cemetery in Virginia.

Posted by: Eduardo | April 21, 2008 12:53 AM | Report abuse

Actually, Clinton is lying again, as only an expert liar can.

Anybody can come right out and say something blatantly wrong - such as being under fire in Bosnia, but the truly skilled liar is one who only gives part of the facts and leads you away from the truth towards the lie they want you to believe. All without really saying the lie out loud.

Off topic: I can't wait for later this year, when everybody starts blaimed McCain and the Republicans for starting the negative ads and mud slinging. It will be like what is happening now didn't even occur. The Obama/Clinton wars will have been just another make believe story grown from the evil right-wing plot to make the Democrats look bad.

And the reporters will goose-step in line, again, just like 4-8-12-16 ... years ago.

History repeats itself, again.

Posted by: DC Voter | April 21, 2008 10:45 AM | Report abuse

As I have said before this column is so dumb. You parse Clinton's comments at the debate evening saying she is basically right and you totally don't deal with Obama's remarks.

I am sure the Republicans are using a handwriting expert to look at the writing Obama denies is his on the questionairre over guns.

They are looking at his relationshps to Rezko which has changed everytime someone uncovers more donations Rezko made to him.

The are looking at his lie about not hearing Rev. Wrights sermons and then admitting he heard some of them when he gave his speech on race.

They are trying to find anything that Obama did to work across the isle in the Senate and will most likely find nothing which they will tout.

It is interesting that no matter how slanted the post news columns have been to Obama - this column included- the editors have not endorsed him.

Guess it proves the separation of editorial to news but it certainly doesn't account for the Washington Post being an Obama newsletter for most of the campaign.

Posted by: peter DC | April 21, 2008 11:07 AM | Report abuse

I don't understand why the current administration is never subject to The Fact Checker. There's plenty of material to work with.

Posted by: JWG | April 21, 2008 12:56 PM | Report abuse

Examples of Hillary's prevarications are legion. Why would the esteemed Mr. Dobbs choose a statement in which she is essentially truthful and anything but misleading upon which to criticise her? Rather than doing public enquiry a service, this column is becoming as irrleavant as a George Stephanopoulus question.

Posted by: Stonecreek | April 21, 2008 1:02 PM | Report abuse

Baloney.

HRC deserves no Pinocchios (and I am an Obama supporter).

She is UNDERSTATING the fiscal irresponsibility associated with the Iraq War, which is indeed unprecedented and FAR WORSE than anything in our past.

Bush is the first President to fund war by foreign borrowing. The national debt increased around $4 trillion on Bush's watch, with an unprecedented $1.33 trillion or so being borrowed from abroad, roughly what has been spent on the Iraq War.

This is a recipe for disaster: it was the root cause of the decline of Hapsburg Spain and Bourbon France.

It may well be our undoing. too. It has FAR MORE to do with the housing bubble, subprime fiasco, and skyrocketing oil prices (in dollar terms) than has yet been reported or realized.

Posted by: mnjam | April 21, 2008 1:25 PM | Report abuse

Was Bosnia a free ride? Gee, didn't we have a President on day one back then?

Maye the Tuzla Terror just mis-remembered or had a senior moment?

Huh?

Posted by: John of Arizona | April 21, 2008 2:28 PM | Report abuse

Actually, Hillary's reference is correct. Bush has done nothing except increase our debt and increase our spending. He is the one that lied first, telling the American people that this war would cost no more than 60 billion. That number has long passed. I would say that VP Cheney's connections have profited more than 60 billion over this war. Please do not split hairs here...Bush has not paid for this war, bottom line. That was her statement, period!

Posted by: Gilbug | April 21, 2008 8:10 PM | Report abuse

Actually, Hillary's reference is correct. Bush has done nothing except increase our debt and increase our spending. He is the one that lied first, telling the American people that this war would cost no more than 60 billion. That number has long passed. I would say that VP Cheney's connections have profited more than 60 billion over this war. Please do not split hairs here...Bush has not paid for this war, bottom line. That was her statement, period!

Posted by: Gilbug | April 21, 2008 8:10 PM | Report abuse

Actually, Hillary's reference is correct. Bush has done nothing except increase our debt and increase our spending. He is the one that lied first, telling the American people that this war would cost no more than 60 billion. That number has long passed. I would say that VP Cheney's connections have profited more than 60 billion over this war. Please do not split hairs here...Bush has not paid for this war, bottom line. That was her statement, period!

Posted by: Gilbug | April 21, 2008 8:10 PM | Report abuse

Actually, Hillary's reference is correct. Bush has done nothing except increase our debt and increase our spending. He is the one that lied first, telling the American people that this war would cost no more than 60 billion. That number has long passed. I would say that VP Cheney's connections have profited more than 60 billion over this war. Please do not split hairs here...Bush has not paid for this war, bottom line. That was her statement, period!

Posted by: Gilbug | April 21, 2008 8:13 PM | Report abuse

Actually, Hillary's reference is correct. Bush has done nothing except increase our debt and increase our spending. He is the one that lied first, telling the American people that this war would cost no more than 60 billion. That number has long passed. I would say that VP Cheney's connections have profited more than 60 billion over this war. Please do not split hairs here...Bush has not paid for this war, bottom line. That was her statement, period!

Posted by: Gilbug01 | April 22, 2008 10:35 AM | Report abuse

"I think [the war in Iraq] is the first time we've ever been taken to war and had a president who wouldn't pay for it."

Where in that statement are the words "failed to pay 100% for the war through taxes on the population."???

Yet that is the test Fact Checker applies in giving Hillary a Pinocchio.

What has Bush done to raise capital for paying for the expenses of the war, capital above what the country would be providing in absence of a war? Anything? Did any other president lower taxes during a war? In the past, presidents as least attempted to raise the extra money - Hillary is saying Bush is the first who hasn't done the same. Is she wrong? How is it an exaggeration?

No Pinocchios, IMO.

Posted by: Ron | April 22, 2008 3:36 PM | Report abuse

"I don't understand why the current administration is never subject to The Fact Checker. There's plenty of material to work with."

Posted by: JWG | April 21, 2008 12:56 PM

Simple, JWG: there's no evidence to work with. It's all been hidden or destroyed, and no one on Capitol Hill has the cojones to work to subpoena answers. We can hope a more sympathetic Justice Department will have more success, but I have little hope there will be anything left to find by then.

Posted by: DaveG | April 22, 2008 6:01 PM | Report abuse

The problem is that no-one in the media has the guts or talent or interest to do actual investigating reporting work on this administration. With the media we have today Nixon would have happily finished his second term. As far as Clinton's statement in question: she is fundamentally correct here, does not deserve anything but praise for bringing this very painful fact up. If we had the media a well functioning democracy needs and deserves we would not be in Iraq. But, we have what we deserve, based on our public indifference and ignorance that allowed the total concentration of the media in very few hands like Mr. Murdoch, who does not feel any responsibility to the public to deliver unbiased news, only responsibility to make profit and more profit to himself. The rest has been following him and his ilk like sheep.

Posted by: Simon | April 22, 2008 10:04 PM | Report abuse

In a true democracy,the mass media would have ardently helped the American people and congress successfully impeach George W.Bush at least two years ago, in his malignant narcissistic stance on continuing the unlawful Iraq war. Calling George W.Bush a liar, a moron, and an idiot, just doesn't cut it! An internationally corrupt government would have been eliminated by most advanced nations,i.e. of Europe by now! Hurting the American poor and underprivileged,including the ignorant is criminal, and the cancerous regime should have long ago been extirpated! As an immigrant in self-imposed exile I feel quite badly about the "raw deal" most Americans are facing.

Posted by: Dottor Giorgio da Caltanisetta | April 23, 2008 6:57 AM | Report abuse

bush isn't paying for part of the war?dang just how much did Lincoln or FDR take out of thier pocket to pay for thier wars?Oh they used taxes to pay?Then what you really ment to say was the people payed for the war perhaps?Lets get it right here.The people are paying for this senceless war unless of course you call the corporations who are reaping record profits the people.What is the difference between paying for it with taxes or paying for it with the devaluation of the dollar?The dollar has lost 56cents in seven years so
bush can have his war.As I see it the only difference is the words used.Of course bush won't raise taxes to pay for this blunder but down the road someone will have to then our children and grandchildren will get to pay for it.Hmmm! we pay and our children pay.bush maybe onto something here.I think we should all be more complacent and elect
any one of the canidates the corporate controled media has selected for us to vote for.We can elect either Clinton or Obama and spend more on thier pet programs or we can elect McCain and continue to spend on this war and a new one with Iran.The only difference being the rate at which the USA crumbles like the USSR from spending more than they have.I say go with McCain and get it over quickly.I think I will go to the bigger gun store before the election so I have a chance to get the loaf of bread when we drop into the abiss of chaos.

Posted by: pooty | April 23, 2008 12:20 PM | Report abuse

Just a little info here for those well informed individuals above.The USA is not a democracy it is a republic.And an addon for those that claim the media is not doing thier job.Walter Cronkite is no longer doing the news.The news is controled by big corporations.Big corporations profit from not having bush out of power.pelosi isn't going to allow bushs impeachment wonder why?I mean the real reason why?And the fact check is the media is doing thier job.They are keeping the people in line and voting for the canidates they choose.Any canidate who honors his oath to the constitution is maginalised.After all the constitution is just a bunch of rules for the federal government to follow and no one needs that when it gets in the way of record profits for the corporations.

Posted by: pooty | April 23, 2008 12:38 PM | Report abuse

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