Today's Krugman:

It's all coming true. Before the war, hawks insisted that Iraq was a breeding ground for terrorism. It wasn't then, but it is now. Meanwhile, administration apologists blamed terrorists, not tax cuts, for record budget deficits. In fact, before the war terrorism-related spending was relatively small — less than $40 billion in fiscal 2002. But the costs of a "bring 'em on" foreign policy are now looming large indeed.

The direct military cost of the occupation is $4 billion a month, and there's no end in sight. But that's only part of the bill.

This week Paul Bremer suddenly admitted that Iraq would need "several tens of billions" in aid next year. That remark was probably aimed not at the public but at his masters in Washington; he apparently needed to get their attention.

It's no mystery why. The Coalition Provisional Authority, which has been operating partly on seized Iraqi assets, is about to run out of money. Initial optimism about replenishing the authority's funds with oil revenue has vanished: even if sabotage and looting subside, the dilapidated state of the industry means that for several years much of its earnings will have to be reinvested in repair work.

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