The U.S. in Iraq: An economics lesson

Tuesday, the U.S. "stood down" in Iraq, finalizing the pullout of 140,000 troops from Iraqi cities and towns -- the first step on the long path home. After more than six years, most Americans are war-weary, even though a smaller percentage of us have been involved in the actual fighting than in any major conflict in U.S. history. We have relegated the car and suicide bombings to the inside pages of newspapers, accepting at face value that the "surge" has calmed things down enough so we can finally leave the whole sorry Iraq adventure behind us.

But not so fast. The conflict that began in 2003 is far from over for us, and the next chapter -- confronting a Taliban that reasserted itself in Afghanistan while the U.S. was sidetracked in Iraq -- will be expensive and bloody. The death toll for U.S. troops in Iraq and Afghanistan reached 5,000 in June. An additional 80,000 Americans have been wounded or injured since the war in Iraq began. More than 300,000 of our troops have required medical treatment, and Army statistics show that more than 17% of our returning soldiers suffer from post-traumatic stress disorder.

Meanwhile, in Iraq, even though most of the population has long told pollsters they can't wait for U.S. forces to leave, U.S. officials have said we are likely to station 50,000 troops at military bases in the country for the foreseeable future. This is because the situation in Iraq is highly precarious. The country ranks high on lists of the most dangerous places on Earth, with a continual stream of suicide bombings and murders targeting political and religious leaders as well as civilians. According to the Brookings Institution's Iraq Index, 2 million people -- largely from the middle class by most accounts -- fled Iraq during the war, but only a handful have returned. (The vast majority of Iraq's doctors, lawyers and other professionals are now living abroad, and many are seeking asylum.) An additional 2.7 million "internal" refugees -- 10% of the population -- abandoned their homes, and most are too frightened to go back. The struggle for power among Kurds, Shiites and Sunnis is still in flux, with battles looming over oil and land.