Failed Democratic presidential contender John Edwards said that Americans felt "great concern and anxiety" about their economic security, including worries about gasoline prices, healthcare, college costs and mortgages.
"All of these things are made much worse by concern about what's happening in Iraq," he said on a media conference call launching the campaign by groups including MoveOn.org, VoteVets.org and Americans United for Change.
"People don't understand why we're spending 500 billion dollars and counting in Iraq at the same time that we've got 40 million plus Americans who don't have any healthcare coverage, 37 million living in poverty, people terrified about being able to pay their bills," Edwards said.
As the war enters its sixth year, the "Iraq Campaign 2008" said it would spend more than 20 million dollars on advertising the conflict's costs and highlighting their impact on communities across the United States.
MoveOn.org executive director Eli Pariser said the campaign would "make the rising costs of the war and the tradeoffs it has forced this country to make a central issue" of the 2008 elections to Congress and the White House.
The coalition has identified around 50 Republican members of the House of Representatives and several senators that it believes are vulnerable to defeat in the elections, if Iraq costs are made a campaign issue.
Democrats complain that Republican blocking tactics in the Senate have prevented an end to the Iraq war, making minority leader Mitch McConnell of Kentucky and Minnesota's Norm Coleman prime targets of the new campaign.
"We're going to ensure they pay a price for standing with George Bush and John McCain and their failed war policy," Pariser said, referring to the president and the likely Republican nominee in this year's White House race.
VoteVets.org chairman Jon Soltz, a veteran of Kosovo and Iraq, said the campaign was not disparaging Senator McCain's own heroism during the Vietnam War.
"But when it comes to his policies on Iraq, he is no different to George Bush. From now until the election, we will continue to hold him accountable for his failed policies," he said.
© 2008 Agence France Presse