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MARCH 5, 2003
7:08 AM
CONTACT:  Economists Allied for Arms Reduction
Sean Meyer, 413-259-9129;
From Peace Dividend to War Surcharge;
Prominent U.S. Economists Oppose Unilateral Iraq War and Warn of Growing Economic Peril
PEARL RIVER, N.Y. - March 5 - Many of the nation's leading economists today issued a statement opposing a unilateral U.S.-led war against Iraq and warning policy makers and all Americans that long-term U.S. and global economic security is at stake.

Released by Economists Allied for Arms Reduction (ECAAR), a New York-based research and policy organization, the statement is signed by seven Nobel laureates and a large number of other prominent U.S. economists. The Nobel laureates are Kenneth J. Arrow, Lawrence R. Klein, Daniel McFadden, Douglass North, William F. Sharpe, Robert M. Solow and Joseph E. Stiglitz.

The signatories express concern for the "immediate human tragedy and devastation of war" and that this war might "increase the risk of future instability and terrorism." They argue "given the precarious state of our own economy, America requires the attention and focus of leadership and resources to address economic problems at home." The statement also says "the American people cannot afford to tolerate a mismanaged economy or a naive underestimation of America's economic perils."

"The Bush Administration is not playing it straight with the American public as to the potential economic consequences of this war," says Professor James K. Galbraith, LBJ School of Public Affairs at the University of Texas at Austin. "And with its rush to war, the Administration is diverting the public's attention away from dire economic problems that we are not working to solve."

The statement reads, "no administration can credibly promise to solve all problems simultaneously." It also refers to the following "serious problems" that the American economy is experiencing "as a result of our administration's comparative neglect."

-- Private business investment has not yet started to recover in most areas -- resulting in a continuing and growing lack of jobs; focus on military sector will impede recovery of technology sector

-- Troubling slowdown in consumer spending -- growing household debts; continuing decline in the U.S. dollar; war could drive up interest rates and energy prices and unleash major consumer retrenchment

-- State and local government budgets continue to suffer -- resulting in severe cuts in services and tax increases, continuing lack of federal support for homeland security funding requirements, inadequate attention to health care, education, unemployment, poverty and other problems

"On the brink of war, it's time for us to take stock and consider all aspects of what makes us, as a nation, secure," says Columbia University Economics and Finance Professor Joseph E. Stiglitz, the 2001 Nobel laureate in economics. "We cannot make this monumental decision -- to go to war -- without weighing carefully the entire scope of what is at stake, from the potential for tragic human consequences to further erosion of our already tenuous economic situation."

Go to for the entire statement and the complete list of over 130 signatories.

About ECAAR: Based in Pearl River, N.Y., Economists Allied for Arms Reductions (ECAAR) -- -- is an organization of U.S. economists and business leaders that seek to promote objective economic analysis and appropriate action on global issues relating to peace, security and the world economy. The organization can be reached at 845-620-1542 or by email at


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