Not just a world cop, US spends big to keep peace

President Clinton announced Nov. 30 the US would give an extra $400 million to Yasser Arafat's Palestinian Authority next year, for a total of $500 million. Just last week Israel asked the United States for an extra $1.25 billion.

Various economic levers wielded by the US around the world - from trade sanctions to funding for election monitors - eventually carry a high cost, as widespread efforts to quell conflicts or keep the lid on potential new ones are taxing, literally.

Compared with war, peace is a bargain. The cold war's end has saved the US some $400 billion since 1992 in defense spending. But a hard look at the kinds of nonstandard military and other costs associated with US peace efforts in Rwanda, Bosnia, the Korean Peninsula, the Arab-Israeli arena shows how the costs of peace add up.

The case of North Korea shows how costly it can be for the US and for some other industrial nations.

Under an agreement reached four years ago, Pyongyang was to suspend the operation of a nuclear reactor and a fuel reprocessing plant capable of making weapons-grade plutonium.

In return, the US was to end economic sanctions and join Japan and South Korea in building two nuclear-energy reactors costing $5 billion in North Korea that could not be easily adapted to produce suitable plutonium. Japan was to provide $1 billion for the reactors.

Congress would not provide funds for the reactors. So the US pledged to provide $35 million a year for 500,000 metric tons of fuel oil annually until the reactors came on line.

"War, or even maintaining the forces for war, is far more expensive than keeping the peace," says Gordon Adams, deputy director of the International Institute for Strategic Studies (IISS), a London think tank that keeps track of world military spending.

A $1 billion buildup

Aside from the monetary cost of wars, armed conflicts have taken some 45 million lives in the 50 years since World War II. Yet winning, building, and maintaining peace in the post-cold-war era is requiring the world's well-to-do nations to spend many billions of dollars.

For example, the November military buildup in the Persian Gulf has cost taxpayers well over $1 billion. The goal is to prevent Iraq from developing weapons of mass destruction.

The United Nations spent $1.3 billion on its 15 peacekeeping operations around the world in the fiscal year that ended June 30. It has budgeted approximately $1 billion in its current fiscal year. The US share is 25 percent, Congress says, 30.5 percent according to the UN. The US money comes from the State Department budget.

Cumulative overall costs for ongoing UN peace operations are estimated at $6.6 billion in the years up to and including 1997-98, reckons the IISS.

More than 14,000 UN peacekeeping troops from some 76 nations are trying currently to keep hostilities at bay in such places as the contested Golan Heights, in southern Lebanon, along the Kuwait-Iraq border, in Cyprus, in Kashmir between India and Pakistan, in Angola, the Western Sahara, Georgia, Tajikistan, and so on.

Some 588 are American, donning the blue helmets or berets of UN peacekeeping forces.

"The UN operates on a shoestring," says Barry Blechman, chairman of the Henry L. Stimson Center, a public policy group in Washington dealing with defense and disarmament issues. He's critical of the US failure to pay its full dues to the organization. "We should be improving the UN capabilities for peacekeeping. It is criminal the US is not living up to its obligations. It increases the demand on our own forces."

More than twice as many troops as those from all nations working for the UN are engaged elsewhere by NATO or some other body in peacekeeping operations, according to Terry Taylor, assistant director of IISS.

Some 8,000 US military personnel are engaged in these non-UN operations. The US Army provides them with special training for such operations as separating belligerents, ending hostilities, establishing buffer zones, protecting and assisting relief efforts, evacuating noncombatants, and preparing to turn territory over to peacekeeping forces.

The NATO-led Stabilization Force has more than 30,000 troops in Bosnia-Herzegovina. The cost for the UN since 1996: $5 billion; $4 billion is budgeted this fiscal year.

Over time, the West has spent $14.6 billion on the Bosnia affair - more if the cost of reconstruction aid is included.

The Organization for Security and Cooperation in Europe is supposed to send 2,000 unarmed observers to Kosovo to verify Serbian compliance with UN resolutions, including withdrawal of troops from Kosovo and the return of ethnic Albanian refugees.

That too, along with reconstruction efforts, will cost money.

Cost of sanctions

The US currently maintains some form of economic sanctions against 26 countries, accounting for half of the world's population. These include China, India, Pakistan, Iran, Iraq, and Cuba. Sanctions can be expensive for the US in lost trade and other economic ties.

Three US economists, Gary Hufbauer, Kimberly Elliott, and Jeffrey Schott, estimate sanctions cost the US $20 billion a year in lost exports, or 200,000 jobs.

One sanction against India and Pakistan for setting off nuclear bombs last spring was the prohibition of Export-Import Bank (Exim) loans on exports to these nations. The action blocked $500 million in loans for six projects for India, the US indicated. Such sanctions could hit US companies like Boeing, hoping to sell billions of dollars of aircraft to these nations, financed by Exim loans.

Under the Cooperative Threat Reduction Program initiated by Senators Richard Lugar (R) of Indiana and Sam Nunn (D) of Georgia, the US has provided more than $2 billion to Russia, Ukraine, Kazakstan, and Belarus since 1991 to help pay for, among other things, scrapping nuclear weapons. This year's US Defense Department budget provides $442.4 million for the program, up from $381 million.

Under a disarmament treaty with the US, Ukraine this month began cutting to pieces the first of its 44 warplanes capable of carrying nuclear bombs.

Because of fears that some of Russia's impoverished nuclear scientists might leave for aspiring nuclear powers like Iran and Iraq, the US Department of Energy has pledged some $30 million in assistance through 1999 to start up new Russian businesses in 10 cities with nuclear facilities. The hope is to attract hundreds of millions in Western investment.

Other costs besides those of sanctions add up. The US contribution to the UN operation in Somalia amounted to $2.2 billion between 1992 and 1995, according to the General Accounting Office.

One problem for the Clinton administration is that the costs of peace usually fall within the $20 billion or so in the budget for foreign affairs, notes Mr. Adams. And Congress is stingy in approving such spending.

Defense Department expenditures sail through Congress with relatively few challenges. So does the more than $700 million for humanitarian efforts, such as relief for the hungry or for refugees.

Most US humanitarian aid flows through the State Department or other foreign-affairs budget items. But the Defense Department has budgeted $63.3 million this year for demining and other humanitarian efforts, up from $56 million last year.

Peace "doesn't have a lot of domestic support," says Adams. "It is hard to fund."

Cost of peace for the US

* Beyond US spending for normal military deterrence of war, the US also spends large amounts to encourage peace in world trouble spots. Here are some big expenditures:

For Israeli-Egypt peace this year - $5.1 billion (aid to Israel since 1979 - $74 billion; cumulative aid to Egypt - $51 billion).

Assistance to Rwanda - $450 million since the 1994 genocide.

Contribution to UN peacekeeping - About $250 million this year.

Oil given to North Korea to drop its nuclear project - $35 million a year.

For 1992-95 operation in Somalia - $2.2 billion.

For former Soviet states, including Russia, to scrap various nuclear, chemical, and other weapons - $2 billion.

Military peacekeeping costs in Bosnia this fiscal year - $1.86 billion.