Somalia Illustrates the High Cost of Failed States

Secretary of State Hillary Clinton's Africa visit earlier this month disappointed experts who'd hoped for groundbreaking new policies. But it certainly made one man happy: Sheik Sharif Sheik Ahmed, president of Somalia's transitional government, who won promises of more money, equipment, and training for his beleaguered country.

If the promised millions have much effect, Washington will be getting a bargain. The global cost of anarchy in Somalia and other failed states like Haiti is far higher than most assume. The total bill, according to new estimates by political scientists at Oxford University, comes to $270 billion a year and includes the damage from civil war and the lost income due to nonfunctioning economies. Even in the era of trillion-dollar financial bailouts, that's still a shockingly high figure, and a conservative one at that—it doesn't include the impossible-to-pin-down costs of the global threats, such as drug trafficking, spawned by failed states. Still, the brunt of the tab—some 87 percent—is borne by the neighbors of failed states, whose national incomes are depressed by the nearby chaos. That can drag down -vital U.S. allies like Kenya, which now hosts some 300,000 Somali refugees, and expand the region in which pirates, terrorists, and other international dangers thrive. Such a calculus should revise U.S. thinking, as it makes the price of nonintervention much higher than previously thought—even when the immediate risk is far from American shores.