NEW YORK ― The September 11 , 2001 , terror attacks by al - Qaida were meant to harm the United States , and they did , but in ways that Osama bin Laden probably never imagined . President George W . Bush ’ s response to the attacks compromised America ’ s basic principles , undermined its economy , and weakened its security . The attack on Afghanistan that followed the 9 / 11 attacks was understandable , but the subsequent invasion of Iraq was entirely unconnected to al - Qaida ― as much as Bush tried to establish a link . That war of choice quickly became very expensive ― orders of magnitude beyond the $ 60 billion claimed at the beginning ― as colossal incompetence met dishonest misrepresentation . Indeed , when Linda Bilmes and I calculated America ’ s war costs three years ago , the conservative tally was $ 3 - 5 trillion . Since then , the costs have mounted further . With almost 50 percent of returning troops eligible to receive some level of disability payment , and more than 600 , 000 treated so far in veterans ’ medical facilities , we now estimate that future disability payments and health care costs will total $ 600 - 900 billion . But the social costs , reflected in veteran suicides ( which have topped 18 per day in recent years ) and family breakups , are incalculable . Even if Bush could be forgiven for taking America , and much of the rest of the world , to war on false pretenses , and for misrepresenting the cost of the venture , there is no excuse for how he chose to finance it . His was the first war in history paid for entirely on credit . As America went into battle , with deficits already soaring from his 2001 tax cut , Bush decided to plunge ahead with yet another round of tax “ relief ” for the wealthy . Today , America is focused on unemployment and the deficit . Both threats to America ’ s future can , in no small measure , be traced to the wars in Afghanistan and Iraq . Increased defense spending , together with the Bush tax cuts , is a key reason why America went from a fiscal surplus of 2 percent of GDP when Bush was elected to its parlous deficit and debt position today . Direct government spending on those wars so far amounts to roughly $ 2 trillion ― $ 17 , 000 for every U . S . household ― with bills yet to be received increasing this amount by more than 50 percent . Moreover , as Bilmes and I argued in our book “ The Three Trillion Dollar War , ” the wars contributed to America ’ s macroeconomic weaknesses , which exacerbated its deficits and debt burden . Then , as now , disruption in the Middle East led to higher oil prices , forcing Americans to spend money on oil imports that they otherwise could have spent buying goods produced in the U . S . But then the U . S . Federal Reserve hid these weaknesses by engineering a housing bubble that led to a consumption boom . It will take years to overcome the excessive indebtedness and real - estate overhang that resulted . Ironically , the wars have undermined America ’ s ( and the world ’ s ) security , again in ways that bin Laden could not have imagined . An unpopular war would have made military recruitment difficult in any circumstances . But , as Bush tried to deceive America about the wars ’ costs , he underfunded the troops , refusing even basic expenditures ― say , for armored and mine - resistant vehicles needed to protect American lives , or for adequate health care for returning veterans . A U . S . court recently ruled that veterans ’ rights have been violated . ( Remarkably , the Obama administration claims that veterans ’ right to appeal to the courts should be restricted ! ) Military overreach has predictably led to nervousness about using military power , and others ’ knowledge of this threatens to weaken America ’ s security as well . But America ’ s real strength , more than its military and economic power , is its “ soft power , ” its moral authority . And this , too , was weakened : as the U . S . violated basic human rights like habeas corpus and the right not to be tortured , its longstanding commitment to international law was called into question . In Afghanistan and Iraq , the U . S . and its allies knew that long - term victory required winning hearts and minds . But mistakes in the early years of those wars complicated that already - difficult battle . The wars ’ collateral damage has been massive : by some accounts , more than a million Iraqis have died , directly or indirectly , because of the war . According to some studies , at least 137 , 000 civilians have died violently in Afghanistan and Iraq in the last 10 years ; among Iraqis alone , there are 1 . 8 million refugees and 1 . 7 million internally displaced people . Not all of the consequences were disastrous . The deficits to which America ’ s debt - funded wars contributed so mightily are now forcing the U . S . to face the reality of budget constraints . America ’ s military spending still nearly equals that of the rest of the world combined , two decades after the end of the Cold War . Some of the increased expenditures went to the costly wars in Iraq and Afghanistan and the broader Global War on Terrorism , but much of it was wasted on weapons that don ’ t work against enemies that don ’ t exist . Now , at last , those resources are likely to be redeployed , and the U . S . will likely get more security by paying less . Al - Qaida , while not conquered , no longer appears to be the threat that loomed so large in the wake of the 9 / 11 attacks . But the price paid in getting to this point , in the U . S . and elsewhere , has been enormous ― and mostly avoidable . The legacy will be with us for a long time . It pays to think before acting . By Joseph E . Stiglitz Joseph E . Stiglitz is University Professor at Columbia University , a Nobel laureate in economics , and the author of “ Freefall : Free Markets and the Sinking of the Global Economy . ” ― Ed . ( Project Syndicate )