Economists Predicted Prolonged US Presence In Iraq Could Spark Recession

In yesterday's press briefing, a reporter asked White House Press Secretary Dana Perino about the tie between the current U.S. economy and the Iraq war. Perino quickly dismissed the reporter's question, insisting that the U.S. economy has been "very strong" and adding that the money was necessary to "take the fight to the enemy" after 9/11...

...Oil prices are at approximately $88 a barrel, although they have dropped from the record high of $100 earlier this month. As Nobel laureate Joseph Stiglitz recently noted in Vanity Fair, "The soaring price of oil is clearly related to the Iraq war. The issue is not whether to blame the war for this but simply how much to blame it."

Before the war, economists were predicting that oil prices at just $75 a barrel could potentially send the U.S. economy into a recession. Therefore, the current economic situation should not come as a complete shock to the Bush administration.

Read more, and watch video, here.

Comments

[yappnmutt]

the price of oil certainly has an effect on the economy in the sense that money spent on oil products will not be spent on something else. that's why the effect of the oil price on a household budget involves a lot of over smart economists and some money to figure out the precise numbers derived to make an argument for why that number is correct. the only thing that causes a recession is a lack of liquidity. anything can cause a lack of liquidity including paying more for one thing at the expense of other things. i already said that. in this case the banking excesses, like 1929, caused its own liquidity crisis because the bankers were pigs and pigs get slaughtered in the market. there will soon be pig blood in the street and a lot of white american middle class suffering also, a great show if you like history. oh, gas will be a lot cheaper then, so will gold.

[Moshe]

A retarded chimp could have predicted that the fiasco in Iraq would bankrupt the U.S.

$2 trillion and counting would knock the wind out of a robust economy, but when you have a $9 trillion debt, a $6 trillion trade deficit, almost no manufacturing base left replaced by a "consumer" economy, and you are hemoragging with at least two gapping wounds in the war and the credit market, that ship is going down.

The U.S. had it made. But in a generation we have gone from riches to rags.

The sooner we start bailing the better, but the shit is now directly in front of the fan for maximum dispersion.

The remedy is clear. It is old fashioned personal responsibility in our own lives, and accountability under the Rule of Law in our elected officials. The American People are going to have to stop living beyond their means, spending less and saving more. And those that we elect to represent US shouldn't be able to sell out their own nation for personal gain and then walk away rich. They shouldn't be able to walk away at all, but should be in jail.

It's time for some genuine traditional American values, including fiscal responsibility (personally and collectively), responsible life choices, honesty, mutual respect, and demanding that the Rule of Law be respected by all.

My grandparents, and those of millions of Americans, started with nothing and ended up relatively rich. Today, millions of Americans are starting out relatively rich, and then leaving their children nothing but a massive debt.

That is simply wrong and completely unacceptable.

It's time to start bailing folks.

[SaviourMachine]

One needn't be an economist or a psychic for that matter to have foreseen this.

Got a question for Perino,if the economy is so strong why did Bu$h come up with a "Economic Stimulus Plan"???

Oh Dana,please stop freebasing the Kool Aid powder.

[Moshe]

"Perino quickly dismissed the reporter's question, insisting that the U.S. economy has been "very strong.""

Perino is starting to sound like "Baghdad Bob" in his final moments.

[godlessclif]

Another "No s#!t Sherlock moment for Huffington business news. Yes! a long war of attrition will screw the economy of all antions involved. What was your first clue?

[LeftVetPatriot]

http://www.nationalpriorities.org/costofwar_home

Derrh. Do the MATH!!

[chronic]

Boy, these people are geniouses.

[votingplumber]

Ya don't say!!
You don't have to be an economic wizard to figure that one out!!
But you do have to have courage to admit that the economy is screwed by this war and the outragous spending that came along with it, and to who's advantage? The citizens of Iraq? Nope, the American People? Nope, the hope of peace in the region? Nope. The rich got richer and the rest of the world got screwed, and the rest of us (and our kids) and their kids, will get to pay for it. And we as Americans, we just got hated by everone.
Good job you economic puppets.

[kopyrightliberationfront]

The Iraq War Recession has a nice ring to it, no?

[jeffwtux]

I have just 2 questions:
1. How much do these brilliant, genius, HAAAHVUD Economists make?
2. Why can't I be one?

Thankyou, billiant economists with your observation no one thought of. I've got 2 bits of news for you.

1. We are already in a prolonged presence in Iraq, soon to be 5 years.
2. We are already in a recession.
There, now where's my high 6 figure salary and nobel prize?

[Clarabell]

Is someone paid to come up with these brilliant observations?

[mrcontinental]

We'll be in Iran soon enough.

[olgraydawg]

The French left Viet-nam, we went in...the Soviets left Afghanistan, here we come, always with the gun. Iran, Iraq, Iran, Panama, Iran, where are we winning and what have we won?

[dansama]

I hate to say the name Ron Paul on this site, but he has been saying this since 2002. From his "35 question to ask before invading Iraq": http://www.house.gov/paul/congrec/congrec2002/cr091002.htm
18) Are we willing to bear the economic burden of a 100 billion dollar war against Iraq, with oil prices expected to skyrocket and further rattle an already shaky American economy? How about an estimated 30 years occupation of Iraq that some have deemed necessary to "build democracy" there?

One of the objections before the war was the cost and that after WWII, Korea, Vietnam and the first Gulf War each were followed by recessions.

If the DEMs can't stop this rogue president via impeachment, then he will continue to destroy the dollar, the wealth of this country via his money laundering through Iraq to his KBR & Saudi buddies, and continue to have a fire sale of the assets of our country. Do a search of the business news this week of banks and companies selling parts of themselves to middle eastern states and even China.

[realitytrumpsbull]

Dick Cheney, author of "How to siphon 2 trillion dollars to build my sand castle with",....