Finance ministers and central bankers from the Group of Seven industrialized countries held one of their regular meetings last weekend in Paris. Two days of discussions produced a statement promising efforts to stabilize and stimulate their economies and a pledge to convene again in the event of an emergency. The European Central Bank indicated that it might be ready to provide additional stimulus, but this message of reassurance was undercut by the representatives' unwillingness to use the words "war" or "Iraq," and their failure to come up with a concrete program of cooperation in the event that fighting breaks out.

The G7 communique said that member-states were "confident in the underlying strength of our economies," but cautioned that "geopolitical uncertainties" loomed over the horizon. That is banker-speak for war, and while the prospect is unpleasant, it looks increasingly probable. Their reluctance to say as much is not encouraging.

Economists are already factoring in the impact of war. The Organization of Economic Cooperation and Development said the world's 30 largest economies should grow 2.2 percent in 2003, an increase of 0.7 percentage points over last year, but a significant downward revision of last June's forecast of 3-percent growth. The International Monetary Fund worries that war could cut global growth in half, from 3 percent in 2002 to 1.5 percent in 2003. Without a conflict, the IMF believes growth could reach 3.5 percent (which is less than the 3.7 percent forecast offered last year). A recent study by an Australian think tank argues that protracted war with Iraq could cut 2 percent from global growth by 2005 and cost major economies up to $3.6 trillion by 2010. Even a short war could cut world gross domestic product 1 percent a year over the next few years; in the seven years to 2010, the estimated loss would be $491 billion for the United States, $122 billion for Japan and $157 billion for Europe.