What the cost of war really includes

Start with oil

The monetary policy estimate

The geopolitical risk estimate

The stock market estimate

The broad macro forecast

The costs may keep growing

Why boring distinctions matter

The Pentagon said the war with Iran has cost Americans $25 billion. But that number only accounts for missiles fired and equipment destroyed. The true cost of war is measured by the future we’ve given up. In this video — my Director’s Cut of an Op-Ed I wrote last week for the New York Times — I explain why that figure is dangerously misleading and show you the math for a less precise, but far more honest answer.

Using the economic concept of opportunity cost, I walk through six methods for calculating the war’s real price tag, tracing the clues through oil, interest rates, geopolitical risk, the stock market, GDP, and future defense budgets. Each of these prove that this war is not costing tens of billions — but hundreds of billions, and quite possibly trillions.

Every number answers a question, and the Pentagon's $25 billion answers a very small one. Here, I'm asking the bigger one: compared to the world we had before this war, what have we lost? The answer should concern every American household.

NYT Op-Ed: https://www.nytimes.com/2026/05/08/opinion/hegseth-war-cost.html

The Pentagon said the war with Iran has cost Americans $25 billion. But that number only accounts for missiles fired and equipment destroyed. The true cost of war is measured by the future we&rsquo;ve given up. In this video &mdash; my Director&rsquo;s Cut of an Op-Ed I wrote last week for the New York Times &mdash; I explain why that figure is dangerously misleading and show you the math for a less precise, but far more honest answer.
Using the economic concept of opportunity cost, I walk through six methods for calculating the war&rsquo;s real price tag, tracing the clues through oil, interest rates, geopolitical risk, the stock market, GDP, and future defense budgets. Each of these prove that this war is not costing tens of billions &mdash; but hundreds of billions, and quite possibly trillions.
Every number answers a question, and the Pentagon's $25 billion answers a very small one. Here, I'm asking the bigger one: compared to the world we had before this war, what have we lost? The answer should concern every American household.
NYT Op-Ed: https://www.nytimes.com/2026/05/08/opinion/hegseth-war-cost.html

From world events to everyday decisions, economics explains it all. Platypus Economics makes it clear, useful, and actually fun.

From world events to everyday decisions, economics explains it all. Platypus Economics makes it clear, useful, and actually fun.

Platypus Economics with Justin Wolfers

How to measure the true cost of war: Justin Wolfers shows you the math | Diving In

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/7ad102d3-3232-4e39-a058-b44900fab4fc/transcript