Doing cost-benefit accounting of an empire in national terms doesn't make sense. It has to be done in class terms, to understand the power elite's own strategy: how long do benefits of exerting power over foreign peoples accrue to the power elite and ruling class, even at increasingly greater costs to both the empire's subjects at home and abroad?
Strictly in national terms, a modern capitalist empire probably never made much economic sense, but all previous capitalist empires held onto their colonies for many years after costs began to clearly outweigh benefits considered in national terms, as you can see in the Algerian case:
<blockquote>If the demand side of modernization challenged expectations, the supply side was still more aberrant. Modernization theory anticipated that Third World peoples would endure deprivation and threaten unrest during a transition phase, although integration in the world economy through specialization and trade would eventually lead to greater prosperity. In this respect, Algeria exhibited all the key features of the transformation of rural economies that had been occurring across the Third World: in China, too, commercialization had earlier led to the abolition of public granaries. In Mexico and Vietnam as in Algeria, it had threatened peasant control of communal land. In these cases and Cuba as well, property seizures drove peasants onto marginal lands insufficient for their subsistence.35 In all these countries, peasants rose up and challenged the new economic order. Both development theorists and their critics would agree that the commercialization of agrarian society was a primary cause of political unrest while differing about whether this painful process was unavoidable. What neither explained was why development—or exploitation—did not pay.36
In Algeria, for instance, the fact that wine accounted for more than half of all exports exemplified this Muslim country's integration in global markets. Yet the government paid growers 25 percent more than the market value of their product, two-thirds of which was considered useless. From 1952, the metropole had to subsidize the Algerian budget, as social services strained to accommodate the expanding, increasingly urban population.37 But rather than forming a consumer society, producing and purchasing goods in global markets, many Muslims in the cities continued to live outside the cash economy—600,000 had no regular source of income. Pierre Bourdieu found it impossible to categorize their lives as traditional or capitalist; indeed, they existed entirely outside this framework of analysis. If there was an Algerian Muslim proletariat, he concluded, it was living in France, but only scraping by in order to send earnings home, thus sustaining subsistence agriculture. On the other hand—and despite massive development projects—private capital began to flow out of Algeria at an accelerating rate: 3.6 billion francs in 1954, 19.5 billion in 1955, 121.1 billion in 1956.38
Algeria was an extreme case of a problem common to colonial authorities throughout the continent. Neither Britain nor France devoted substantial resources to developing their African possessions until World War II, but private capital did not follow public investment. Moreover, now that the expense of imperialism had begun to pinch taxpayers, the British and French press and publics began to subject their colonies to cost-benefit analyses.39 In the summer of 1956, Raymond Cartier argued in a series of influential articles for Paris Match that France ought to redirect investment to the metropole, since it paid inflated prices for what little its African colonies had to offer.40 Likewise, in 1959, John Strachey—former war minister under Clement Attlee—argued that "imperialism has ceased to bring appreciable benefits to the advanced countries (without ceasing to be ruinous for the underdeveloped)."41 (Matthew Connelly, "Taking Off the Cold War Lens: Visions of North-South Conflict during the Algerian War for Independence," American Historical Review 105.3, June 2000, <http://www.historycooperative.org/journals/ahr//105.3/ah000739.html>)</blockquote>
> Such calculations implicitly take into account the potential costs
> of relinquishing power to another empire.
The power elite of the empire also take into account the potential costs of relinquishing power to a regional power, like Iran. They will find it difficult to let go of Iraq any time soon. -- Yoshie <http://montages.blogspot.com/> <http://mrzine.org> <http://monthlyreview.org/>