To borrow Steven Covey’s phrase, the whole world has gone through a ‘paradigm shift’ with the September 11, events. From established economic and political theories, to religions to human rights to geopolitics and to the very basic concepts of freedom and civilization are coming under scrutiny. As if a clumsily overloaded huge truck has turned turtle spilling all its cargo. Forcing the survivors to decide what to pickup, what to abandon and how to reload the truck more symmetrically, in order to resume the journey more safely.
    The epicenter of this catastrophic earthquake may be in New York and Kabul, but no corner of the globe is spared the jolts. While some welcome America to the real world, one cannot ignore that while the West climbed the steep mountain of individual freedom, rest of the world is still stumbling at its foothills. USA in particular, is in serious danger of losing significant part of that freedom to its government. On the contrary, the existing autocratic governments look in serious danger of losing their grip on their abused peoples. In other words, there is a danger of the West heading towards the authoritarianism from which the Third World governments are likely to be uprooted.
    All this is increasingly translating into drastic economic upheaval for the whole world of which USA was never so deeply interlinked a partner, as it is after September 11. Various economies have become de-compartmentalized and more closely linked with each other. US economy has become more vulnerable to economic developments elsewhere.
    Although the real impact of the attacks is only beginning to be felt and may not be fully appreciated for years, The Organization for Economic Cooperation and Development, whose 30 member countries account for most of the planet's wealth, said in its economic outlook that output was expected to fall by 0.3% in the second half of 2001. It would remain very weak in the first half of 2002.
    While the downturn is sharper than that brought about by the Gulf war in the early 1990s, the OECD expressed hope that aggressive cuts in interest rates in the US were probably enough already to secure a rebound in late 2002.
    The weakening world economy dragged down US exports to $77.3bn, immediately after the event. Their lowest value since March 1999 and imports fell by $10.95.6bn in the month as domestic consumers stayed away from the shops after September 11.
    Four commercial passenger jets worth a total of $385 million; several high-rent Manhattan office buildings valued at between $3 billion and $4.5 billion; cleanup costs and infrastructure replacement of about $3.3 billion.
    Peter Navarro, an economist at the University of California, estimated these and other costs and came up with a property-damage bill of between $10 billion and $13 billion. More tentatively, and delicately, he cites actuarial and life insurance guidelines that suggest the 3,000 or so deaths translate into an economic loss of about $20 billion.
    In the days after the attacks, Navarro also estimated that around $47 billion were lost in the form of packages that weren't shipped, trips that weren't taken, advertising that was canceled and other business that didn't go on as usual.
    That's not too far away from a second estimate, this one by the economic forecasting firm of DRI-Wefa, that the attacks reduced the country's gross domestic product for 2001 by about $40.8 billion.
    DRI-Wefa estimates there will be a net loss of about $318 billion to the U.S. economy this year and another $280 billion in 2003. While those are big numbers, they represent around 3 percent of the nation's total gross domestic product for each year.
    Tighter immigration laws and more implementation is going to have another kind of economic impact on the US economy as this will interfere with the workforce in several industries, including the IT industry.
    That makes it more complicated to figure the real impact of the attacks as time goes on. The economy absorbs and adapts, even to traumatic events such as this one. Nevertheless, DRI-Wefa estimates there will be a net loss of about $318 billion to the U.S. economy this year and another $280 billion in 2003.
    While those are big numbers, they represent around 3 percent of the nation's total gross domestic product for each year.
    There are already longer waits at airports and train stations, and more frequent disruptions caused by false alarms and skittish guards.
    All these bills will have to be paid, either by consumers (through higher prices) or by investors (through lower returns). Navarro calls this the "terrorist tax" and worries about what will happen as "productive capital goes into protective capital."
    Ultimately, he believes, the cost will depend on decisions still being made by individuals, businesses and government. “Either under or overreacting to the challenges ahead could cause a drop in economic productivity”, he says.
That could translate over the years into losses totaling many trillions. Not to mention the inflating war expenditure the US government continues to undertake globally as part of the policy of war against terrorism. This does not include the extraordinary financial and military aid to coalition partners, as well as, writing off the loans payable by these countries.