"Moral Hazard" and the War

This article by Uwe Reinhardt from Monday's Washington Post makes a good point about how Americans have a very low, if any, sense of the cost of the wars abroad--emotionally, financially, etc.

The administration and Congress have gone to extraordinary lengths to insulate voters from the money cost of the wars -- to the point even of excluding outlays for them from the regular budget process. Furthermore, they have financed the wars not with taxes but by borrowing abroad.

The strategic shielding of most voters from any emotional or financial sacrifice for these wars cannot but trigger the analogue of what is called "moral hazard" in the context of health insurance, a field in which I've done a lot of scholarly work.

...Moral hazard can explain why, in wartime, the TV anchors on the morning and evening shows barely make time to report on the wars, lest the reports displace the silly banter with which they seek to humor their viewers. Do they ever wonder how military families with loved ones in the fray might feel after hearing ever so briefly of mayhem in Iraq or Afghanistan?

Moral hazard also can explain why the general public is so noticeably indifferent to the plight of our troops and their families. To be sure, we paste cheap magnetic ribbons on our cars to proclaim our support for the troops. But at the same time, we allow families of reservists and National Guard members to slide into deep financial distress as their loved ones stand tall for us on lethal battlefields and the family is deprived of these troops' typically higher civilian salaries. We offer a pittance in disability pay to seriously wounded soldiers who have not served the full 20 years that entitles them to a regular pension.

...When our son, then a recent Princeton graduate, decided to join the Marine Corps in 2001, I advised him thus: "Do what you must, but be advised that, flourishing rhetoric notwithstanding, this nation will never truly honor your service, and it will condemn you to the bottom of the economic scrap heap should you ever get seriously wounded."

...Unlike the editors of the nation's newspapers, I am not at all impressed by people who resolve to have others stay the course in Iraq and in Afghanistan. At zero sacrifice, who would not have that resolve?