Iraq containment would have cost nearly as much as the war. The financial cost of the war in Iraq is going into hundreds of billions, and some even estimate that it could end up surpassing a trillion. To my mind, this puts the age-old theory that the Iraq war was just a "war for oil" to bed forever. The "war for oil" theory is a simple-minded one at best, and a colossally ignorant one at worst. If all America wanted from Iraq was oil, it would have been much cheaper to simply buy it. A number of countries (France, Germany, Russia, China) had cut billion-dollar oil deals with Saddam Hussein's regime -- which, I believe, is the reason those countries opposed the war. If all Saddam wanted for oil was a billion, or even several billion, it would have been much cheaper and easier for the U.S. to buy it from him than to invade and occupy his country. Besides, the price of oil has certainly not declined since Saddam was removed from power -- it has increased! As I write this, a barrel of oil is topping $70. This would certainly not be the case if the U.S. was raiding and plundering the oil supply of Iraq.

Although the monetary costs of the Iraq war and reconstruction may be astronomical, economists at the University Of Chicago estimate that the costs of continuing containment would have been nearly the same. And, in my view, there would have been far less to show for it.

Here is the report from Newsmax:

Amid estimates that the cost of the war in Iraq could run into the trillions, some economists say the real expense could be only slightly higher than what it would have cost to merely contain Iraq instead of invading.

A study by three economists at the University of Chicago's business school - Steven Davis, Kevin Murphy and Robert Topel - gives seven scenarios for the war, and the likeliest two indicate a final cost of between $410 billion and $630 billion.

But the economists also evaluate a range of possible outcomes if the U.S. had chosen the alternative to war.

They note that even before the 9/11 attacks, the United States had 28,000 troops in the region around Iraq, as well as about 30 ships and 200 aircraft enforcing no-fly zones. These forces alone were costing $11 billion to $18 billion a year, according to a report on the study in the influential publication The Economist.

The economists estimate that, without an invasion, there was a 3 percent chance each year that the rule of Saddam Hussein or his sons would collapse.

"Given what America was spending on Iraq, the authors reckon, it would have cost at least $200 billion, in present value terms, to keep containing it until it no longer posed a threat," The Economist reports.

Furthermore, containment would have involved a few contingencies, such as the periodic need for a show of force.

The University of Chicago economists figure that there would have been a 10 percent chance every year of having to send troops to the region again to keep Saddam under control.
Under these assumptions, they "estimate that the expected cost of containment would have been around $400 billion, only a little less than the $410 billion that they now expect the war to cost," according to The Economist.

Predictions of the war's cost by the Bush administration have proved too low. Defense Secretary Donald Rumsfeld cited a figure of $50 billion to $60 billion, and Bush's top economic adviser Larry Lindsey put the figure at $100 billion to $200 billion.

Now an estimate by Linda Bilmes of Harvard University and Joseph Stiglitz of Columbia University put the cost at an astronomical $2.24 trillion through 2015.

But The Economist points out that the Bilmes-Stiglitz estimate takes into account higher oil prices, which are only slightly dictated by the war in Iraq, and interest payments on U.S. spending in Iraq. It also includes $3 billion annually to be spent on veterans' care over the next 20 to 40 years.

A third study by Scott Wallsten and Katrina Kosec for the AEI-Brookings Joint Centre predicts that the war will eventually cost America from $540 billion to $670 billion.