LaPORTE - How could he have gotten it so wrong?  How could Mitch Daniels have failed to properly advise his President and his country on the true costs of war?  Yes, volumes have been written on how nearly "All the President’s Men" gave him bad advice in the lead-up to war and trimmed and tailored their views to suit the President’s inclination to wage a war of choice. But how could the man with ultimate responsibility for our federal budget  - Mitch Daniels - have gotten war cost estimates so wrong when he was White House budget director?  Shouldn’t that horrendous lapse of judgment  raise continuing questions about his judgment now when it comes to objectively valuing state assets or resisting impulses to further privatize state resources like the Indiana lottery?

When it came time for a hard-nosed assessment of war costs, Mitch Daniels not only missed the mark, he missed it by a mile. And our country is still paying for it. We now have the burden of an additional four years of Iraq War costs since Daniels’ election in 2004 to know how tragically mistaken he was when he served in the highest levels of our federal government.

As White House Budget Director, Mitch Daniels brashly predicted that the Iraq War would not only be "an affordable endeavor," he had the audacity to tell the world the Iraqis "would not require sustained aid."  Sitting in the comfort of his kitchen at his Geist Reservoir mansion, Mitch Daniels insisted by phone to a reporter for the New York Times on December 31, 2002,  that the Iraq War costs "will be in the range of $50 to $60 billion."

What amazes many to this day is the pure hubris of a man who had never known the horrors of war, who had never served a day in uniform, not only predicting with absolute certainty the costs of this war, but participating in the public flogging of a fellow administration member, Lawrence Lindsey, whose war estimate was a lot closer to reality than his own.

Former Bush Press Secretary Scott McClellan says, in his tell-all book  that the President became enraged in September 2002 when Lindsey, at that time the president’s top economic adviser, was cited in the Wall Street Journal as saying the war might cost $100 billion to $200 billion. McClellan quotes Bush as saying, "It’s unacceptable. 

White House Budget Director Mitch Daniels gets a pointer from President George W. Bush in the Oval Office as Lawrence Lindsey looks on. (White House Photo)

He shouldn’t be talking about that." Clearly a realistic view of war costs wasn’t "part of the script" for selling the war to the American public. Yet, Mitch Daniels felt the need to ingratiate himself with the President’s inner circle by publicly claiming that Lindsay’s assessment was "very, very high" and that we were somehow poised for a bargain basement rout in this conflict.

Our governor seems to have been an all-too-willing participant in the selling of what Scott McClellan now admits was an "unnecessary" war. At a time when our country desperately needed candor and honesty from its public officials, Mitch Daniels aided and abetted what the president’s spokesman now says was a "political propaganda campaign" which was "aimed at manipulating sources of public opinion."

As has been his pattern as governor, Mitch Daniels simply ignored contrary views and chose not to listen. It appears the White House budget director never even factored in the disastrous impact of the Iraq War on our economy, such as estimating the impact of war on the price of oil. It was $25 per barrel right before the war, with gas at about $1.50 per gallon. Now oil has hit $130 per barrel and gas is over $4 a a gallon.

The quadrupling of oil prices was predictable had Mitch Daniels only looked. A Brookings Institution study in 2001 projected a worst case scenario with oil at $75 a barrel and gas at $3 a gallon based on an interruption in the world’s oil supply in the event of a war lasting 18 months.

Months before we invaded Iraq, Yale economics professor William Nordhaus, a former member of the President’s council of economic advisers, wrote that a protracted war would result in a recession, just as we suffered a short recession following the relatively brief first Gulf War.

This war is now over five years old and will be the most expensive in history, apart from World War II, according to Joesph Stiglitz, Nobel Laureat economist. Stiglitz has predicted that our Iraq War undertaking will cost far more than $2 trillion when taking into account lifetime healthcare and disability benefits for returning veterans and the special round-the-clock medical attention needed for many of the tens of thousands of brave American men and women returning with long-term health problems.  We’re spending $275 million every day on a war that another one of Bush’s yes-men, Paul Wolfowitz, told us would be fully paid for by Iraqi oil!

At a time when Mitch Daniels had an extraordinary opportunity to perhaps provide some candor and yes, unwanted news to this President, he failed  as OMB director and our country has subsequently poured hundreds of billions in national treasure into the sandy pit that is Iraq as a result.  Robert Hormats, vice-chairman of Goldman Sachs put it into context in March when he testified before the Joint Economic Committee of Congress.  As Hormats made clear, the money spent on the war each day is enough to enroll an additional 58,000 kids in Head Start for a year, or make a year of college affordable for 160,000 low income students through Pell grants, or pay the annual salaries of nearly 14,000 more police officers.

Mitch Daniels wasn’t the only hopeless optimist around this president who insisted on absurdly low estimates of the costs of war.  Five years ago, President Bush’s Defense Secretary Donald Rumsfelt also mocked  Lawrence Lindsey for  estimating the war might cost $200 billion. Yet wind the clock forward and we find Congress having already appropriated $600 billion for the Iraq War, some 10 times Mitch Daniels’ estimate. An entire generation of Americans will pay the price as billions more are borrowed  from foreign dictators to pay for this war while  countless schools, roads and bridges in this country are starved of their much needed public investments. In the meantime,  we all pay dearly at the gas pump as the war continues fueling commodity speculators and uncertainty in the futures market.

There should be a reckoning for these kinds of mistakes. Many Americans have paid the ultimate sacrifice for this conflict and the horrendous costs continue to mount. Hoosiers will have an opportunity to tell Mitch Daniels in November they won’t abide that kind of grossly negligent conduct and they aren’t willing to trust that kind of judgment at the helm of our state government for the next four years.

Friedman practices law in LaPorte, Ind., and is a regular Howey Politics Indiana column contributor.