On March 19, 2008, the U.S. will have been in Iraq for five years. The Bush administration was wrong about the need for the Iraq war and about the benefits the war would bring to Iraq, to the region, and to America. It has also been wrong about the full cost of the war, and it continues to take steps to conceal that cost.

In the run-up to the war there were few public discussions of the likely price tag. When Lawrence Lindsey, President Bush’s economic adviser, suggested that it might reach $200 billion all told, Secretary of Defense Donald Rumsfeld dismissed the estimate as “baloney.” Deputy Defense Secretary Paul Wolfowitz went as far as to suggest that Iraq’s postwar reconstruction would pay for itself through increased oil revenues. Rumsfeld and Office of Management and Budget Director Mitch Daniels estimated the total cost of the war in the range of $50 to $60 billion, some of which they believed would be financed by other countries.

For fiscal year 2008 the administration has asked for nearly $200 billion to fund the wars in Iraq and Afghanistan. If Congress provides the money, as it almost certainly will, then the total appropriated for direct operations in these two countries (including reconstruction, embassy costs, enhanced base security, and foreign aid) since the wars began will come to roughly $800 billion. It is extremely difficult to disentangle the Iraq and Afghanistan numbers, but Iraq is by far the larger endeavor and accounts for about three-fourths of the total. By the administration’s own reckoning, then, the cost of the Iraq war, counting only the money officially appropriated, will soon be some $600 billion, or more than 10 times Rumsfeld’s original number.

The administration’s estimates have been low—and wrong—from the start. Some of this is the result of its shortsightedness about every aspect of the war, beginning with its nature and duration. For instance, extensive use of reservists and the National Guard avoided the need to increase the size of the armed forces or resort to a draft—but at a heavy price, including reliance on highly paid contractors, people who in other contexts would have been called mercenaries. Another factor is the soaring price of fuel caused by the increase in the price of oil—which is itself, in part, a consequence of the war.

But even the $600 billion number is disingenuous—which is to say false. The true cost of the war in Iraq, according to our calculations, will, by the time America has extricated itself, exceed $3 trillion. And this is a deliberately conservative estimate. The ultimate cost may well be much higher.

Why the huge difference between our number and the administration’s? One big reason lies in the misleading way the federal government does its accounting. Any publicly owned business, no matter how small, is required by law to use a method of accounting that takes future obligations into consideration. This is known as “accrual” accounting. But Defense Department accounting is done on a “cash” basis, which logs only what the government is actually spending day by day and ignores future obligations. In the case of the Iraq war, the future obligations are huge. They include the cost of replacing military equipment, which is being used up at 6 to 10 times the peacetime rate. They also include the cost of providing health care and disability payments for our returning troops. These costs will be especially high because of our improved ability to keep even the most horribly wounded soldiers alive.

The cash type of accounting also provides an incentive to make short-term savings. It was only in 2007, four years after the war began, and after roadside bombs had caused some 1,500 American fatalities, that the Pentagon decided to replace its vulnerable fleet of 18,000 Humvees with vehicles designed to withstand blasts from so-called improvised explosive devices (I.E.D.’s). The short-term savings have resulted in a great deal of long-term human suffering and have brought on higher-than-anticipated costs for medical care.