Freedom from Blog

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Friday, June 24, 2005

Finance One Week of the U.S. Occupation of Iraq!

So I was playing with a mortgage calculator today and decided that it would be fun to see how much it would cost to finance one week in Iraq using a standard mortgage arrangement. I entered in $1 B USD as the principal, four percent as the interest rate (a bargain), over 30 years (monthly payments). The monthly payment would be $4.8 M USD, and the total pay-off would be almost $1.8 B USD over the life of the loan.

I don't know if even Oprah could afford that kind of monthly payment.

Now, I know mortgages and government borrowing work differently (although I don't understand much more than that). But it seems to me that the financial costs of Mr. Bush's War are not receiving the attention they are due. Especially from "small government conservatives." How much of the U.S. GDP in the next three decades will be consumed by taxes to repay the money we are borrowing to fund this unnecessary war? If you want government to consume less of GDP, can you really support this kind of massive expenditure, seemingly without end?

The reason we can't discuss these costs--because if you bring it up, the issue changes to supporting the troops. But the point is that the troops wouldn't need so much support if they weren't blasting through so much ammo, fuel (which is very expensive over in the Middle East, for some reason, even though that's where most of it is (?)), armor, blood, treasure, body bags, sweat, tears, and so on.

Here's the page I generated:

Principal borrowed: $1000000000.00
Annual Payments: 12 Total Payments: 360
Annual interest rate: 4.00% Periodic interest rate: 0.3333%
Regular Payment amount: $4774152.95 Final Balloon Payment: $0.00
The following results are estimates which do not account for values being rounded to the nearest cent.
Total Repaid: $1718695062.00
Total Interest Paid: $718695062.00
Interest as percentage of Principal: 71.870%

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