The cost of war with Iraq may prove severe: thousands of Americans could lose their lives and U.S. hostages could be placed in further jeopardy.

But the cost of a "peace" with Saddam Hussein, that is, of forswearing military action, will likely be even more horrific:- Kuwait will disappear. Every day Iraqi forces stay in Kuwait is a victory for Saddam. He has annexed the country; tens of thousands of Kuwaitis have been forced from their homes, now occupied by Iraqis and Palestinians; Kuwait's government has been disbanded; its electrical and other support infrastructures are being tied inseparably to Iraq. Kuwait is disappearing before our eyes. In another year, there may be no Kuwait to liberate.

- The international coalition will begin to fall apart. As Saddam's neighbors become convinced that the United States is not willing to risk war to stop Saddam - and that they might have to continue to live with him - they will be more likely to appease him by suggesting a "diplomatic solution," such as a partial withdrawal from Kuwait, control over Kuwait's offshore islands, or greater Iraqi control over Kuwaiti oil reserves.

- Saddam will emerge a hero, radicalizing the Arab world. If Saddam eventually accepts a "diplomatic solution" after withstanding months of pressure from the United States and its allies, he will be transformed into a hero at home and throughout the Arab world. The message - particularly among the more radical Palestinians - will be that force pays off. This will embolden those advocating a "military solution" to the Arab-Israeli conflict, or other conflicts in the region, perhaps putting regional peace efforts on the back burner for decades.

- Saudi Arabia will be destabilized. If Saddam emerges with his army intact, Saudi Arabia will have no viable way to maintain its security. Either the Saudis will have to accept a long-term U.S. military presence - which eventually will undermine the legitimacy of the regime and make it vulnerable to fundamentalist forces - or the Americans will go home and Saudi Arabia will be under Saddam's thumb.

- Saddam will become a nuclear menace. If Saddam is not stopped now, he will come back at us harder in coming years. By early next year he is expected to have a workable biological weapon (which spreads anthrax, plague and other fearsome diseases); within two years he could have nuclear weapons; and within five he may have a ballistic missile capable of delivering these weapons against the United States.

- The United States and its allies, who all rely on oil from the Persian Gulf, will be held hostage. If Saddam survives with his army intact, he effectively will control the oil of the Saudi peninsula, or 45 percent of the world's reserves. This is not a matter of another quarter per gallon at the pump. It is a question of economic survival.

Saddam must leave Kuwait. Ultimately his war machine - at least his weapons of mass destruction - must be destroyed. To achieve these objectives, the United States is likely to have to resort to force.

If America hesitates today, it inevitably will face Saddam again - only this time armed with nuclear weapons. This is the cost of inaction; it is the price against which the cost of war must be measured.

(Jay Kosminsky is deputy director of defense policy studies for the Heritage Foundation.)