I’ve read through the new Davis, Murphy, and Topel paper on the Iraq War. They conclude that if you account for the future dangers of a Saddam-led Iraq, the war might make sense in cost-benefit terms, and yes that does count dead Iraqis. Most of all, this paper takes seriously the costs of future containment efforts that might have been needed against Saddam.
This is serious work and it deserves more attention than it will likely receive at this point. On one side, I very much doubt their assumption that a Saddam-led Iraq "raises the probability of a major terrorist attack by 4 percentage points in any given year…" On the other side, perhaps the current civil war might have occurred, sooner or later, if we had stayed out. It is also hard to estimate the costs from skepticism about U.S. WMD intelligence the next time around. As you might expect, the most important variables are the most difficult to quantify. File this one under The Policy Will be Judged by its Absolute, Not Relative, Consequences.