Stiglitz's Book Triggers White House Criticism

University Professor and Nobel laureate Joseph Stiglitz’s sharp criticism of the Iraq War surely hasn’t curbed accusations that Columbia provokes controversy at home and abroad.

A professor at the Columbia Business School and the School of International and Public Affairs, as well as in the economics department of the Graduate School of Arts and Sciences, Stiglitz shook the political scene this year with the publication of his new book, The Three Trillion Dollar War. Written in collaboration with budget and finance expert Linda Bilmes from the Harvard University Kennedy School of Government, Stiglitz’s book examines the cost of the Iraq War, emerging with an estimate—apparent from the title—that he still considers “conservative.”

“It’s always good to get a reaction out of the White House,” Stiglitz said. “Those in the administration do not have the courage of their own convictions.”

In 2002, when Lawrence Lindsey, President George W. Bush’s economic adviser, suggested that the war might cost $200 billion, then-Secretary of Defense Donald Rumsfeld dismissed the figure as “baloney,” endorsing Office of Management and Budget estimates in the range of $50 to $60 billion.

As of last year, the cost of the invasion has exceeded $400 billion, and the Congressional Budget Office estimated in August 2007 that the appropriations for the war would eventually reach $1 trillion or more.

Yet Stiglitz insists the government manages its accounting in a “misleading” way.
“They’ve used emergency appropriations to finance the war. Those are not object to scrutiny,” Stiglitz said.

In The Three Trillion Dollar War, Stiglitz proposes a 10-step calculation to reach the astronomical figure that caused a stir at the White House. Some of the aspects include “hidden costs” in the budget, the full costs of health care and disability payments for the returning veterans, and, most strikingly, the way the war has cost other parts of the economy.

“We calculated that for one-sixth of the costs, we could have put Social Security on its own footing for 50 years or longer,” Stiglitz said.

White House spokesman Tony Fratto lambasted Stiglitz on thinkprogress.org, claiming that “People like Joe Stiglitz lack the courage to consider the cost of doing nothing and the cost of failure.”

President Bush went even further to denounce the participation of academics in political economics. “We don’t go to war on the calculations of green eye-shaded accountants or economists,” Bush was quoted as saying in the Guardian.

Stiglitz, who has served the chair of President Clinton’s Council of Economic Advisors, insists that the Bush administration is the one “lacking the courage to engage in a democratic debate. They refuse to go to the American people and say ‘you need to pay for this war.’”

He contends that nobody calculated the costs before operations started, and now the White House avoids evaluating the costs and saying why it thinks the numbers are exaggerated, despite repeated pleas from Stiglitz’s team to bear “serious discussions.”

Following the official comments from the White House, Senator Charles Schumer (D-N.Y.) said on thinkprogress.org that he is “tremendously disappointed” at how the administration has disparaged Stiglitz and his work.

While the debate continues, Stigltiz’s bottom line is clear. “After five years of saying ‘victory is around the corner,’ you lose credibility,” he said.

angela.radulescu@columbiaspectator.com