The war in Iraq has already cost the United States more than $400 billion by the most conservative tally, but the total bill could surpass three trillion dollars, according to Nobel Prize-winning economist Joseph Stiglitz.
By the Pentagon's count, $527 billion were allocated from September 2001 through December 2007 to finance the war against terrorism, including $406 billion for Iraq.
The Congressional Budget Office reported in October 2007 that Iraq accounts for $421 billion, or 70 per cent, of the $602 billion that the Congress has authorised for military operations in Iraq and Afghanistan.
The CBO estimates that the total cost of the two wars could reach $2.4 trillion by 2017 including interest on the debt, with Iraq accounting for 70 per cent of the spending, or $1.68 trillion.
But even that pales by comparison with estimates put forward by Stiglitz and Linda Bilmes, a Harvard professor, in a book called The Three Trillion Dollar War: the True Cost of the Iraq Conflict.
According to the authors, the United States is spending $12 billion a month in 2008 to prosecute the war in Iraq. When Afghanistan is included, US war spending bumps up to $16 billion a month.
Looking out to 2017, they contend the conflict will cost more than $3trillion.
They argue that administration cost estimates omit several crucial factors: bonuses offered to attract and retain troops; health coverage for veterans, replacing military equipment; and the impact of the war on the price of oil, which in five years has soared from $25 to more than $100 a barrel.
"I think they throw everything in the kitchen sink into the survey, including the interest on the national debt. So it seems like an exaggerated number to us," said Pentagon press secretary Geoff Morrell.
The independent Center for Strategic and Budgetary Assessments (CSBA) says the inflation-adjusted cost of the Iraq war is now far greater than the 1991 Gulf War ($88 billion) and is on the verge of surpassing the Korean War ($456 billion) and the Vietnam War ($518 billion).
But spending on Korea and Vietnam accounted a higher percentage of the gross domestic product, CSBA said in a report in September.
The CSBA report estimated the total cost of ongoing military operations in Iraq through 2017 at $835 million to $1.26 trillion.
"However, projections of funding requirements for FY (fiscal year) 2008 and, especially, beyond are highly speculative," it said.
"These costs could vary dramatically, depending primarily on how many troops the United States keeps in Afghanistan and Iraq, and for how long." (AFP)
Iraq: a $3trillion war?