What do we have to show for that tab? Two wars that continue to occupy 150,000 troops and tie up a quarter of our defense budget; a bloated homeland-security apparatus that has at times pushed the bounds of civil liberty; soaring oil prices partially attributable to the global war on bin Laden's terrorist network; and a chunk of our mounting national debt, which threatens to hobble the economy unless lawmakers compromise on an unprecedented deficit-reduction deal.
By any measure, bin Laden inflicted a steep toll on America. His 1998 bombing of U.S. embassies in Africa caused Washington to quadruple spending on diplomatic security worldwide the following year--and to expand it from $172 million to $2.2 billion over the next decade. The 2000 bombing of the USS Cole caused $250 million in damages.
Al-Qaida's assault against the United States on September 11, 2001, was the highest-priced disaster in U.S. history. Economists estimate that the combined attacks cost the economy $50 billion to $100 billion in lost activity and growth, or about 0.5 percent to 1 percent of GDP, and caused about $25 billion in property damage. The stock market plunged and was still down nearly 13 percentage points a year later, although it has more than made up the value since.
The greater expense we can attribute to bin Laden comes from policymakers' response to 9/11. The invasion of Afghanistan was clearly a reaction to al-Qaida's attacks. It is unlikely that the Bush administration would have invaded Iraq if 9/11 had not ushered in a debate about Islamic extremism and weapons of mass destruction. Those two wars grew into a comprehensive counterinsurgency campaign that cost $1.4 trillion in the past decade--and will cost hundreds of billions more. The government borrowed the money for those wars, adding hundreds of billions in interest charges to the U.S. debt.
Spending on Iraq and Afghanistan peaked at 4.8 percent of GDP in 2008, nowhere near the level of economic mobilization in some past conflicts but still more than the entire federal deficit that year. "It's a much more verdant, prosperous, peaceful world than it was 60 years ago," and nations spend proportionally far less on their militaries today, says S. Brock Blomberg, a professor at Claremont McKenna College in California who specializes in the economics of terrorism. "So as bad as bin Laden is, he's not nearly as bad as Hitler, Mussolini, [and] the rest of them."
