RATIONALITY, REVENGE, RETALIATION IN IRANIAN MORASS
I’m impressed by Robin Brooks who is extremely knowledgeable about sanctions. However, I feel that he may be overly rationale in a three-dimensional conflict involving a gut instinct Trump, response by a militarily-weakened Iran seeking to counter a blitzkrieg, and Netanyahu, who seems intent on destroying Iran.
I see this as a dangerous potential tit for tat escalation. Brooks seems to prefer draconian sanctions on Iranian oil to force Iran to reopen the Strait of Hormuz petroleum spigot.
I think it possible that Iran might be willing to play a game of chicken, hoping that the impact of of strait closing—and, possibly, the damage of major Arab production facilities—would trigger massive global economic disruption.
Long ago I spent years in the Middle East and even published a book. One thing I’ve learned is that any Middle Eastern prediction is tenuous. One action can set off domino reactions, which is what is occurring now.
WHEN ONE WANTS A COOL HAND LUKE, WE HAVE A GUT ‘MORALITY’ TRUMP WHO ESCHEWS ANY RATIONAL STRATEGY
I was thinking something similar while reading this. I was wishing we had smart, thoughtful people who can think ahead and see possible turns of events, like Dr. Krugman and Dr. Brooks, making policy or advising policymakers. But instead, we have President "feel it in my bones", Secretary of Defense "if I scream about being a warrior, maybe no one will notice what a corrupt, soulless person I am", Treasury Secretary "whatever Trump says is absolutely true" and others who act on whim and slavish devotion to Trump. The psychology angle is important, and both our allies and our enemies have figured out the psychology of the Trump regime.
LHS Many years ago I was point person as a Foreign Service Officer involved in the ultimate decision to use Belgian paratroopers with US support to rescue about 3,000 foreigners under death threat from a rebel Congolese government.
The amount of staff work, from the president down to a range of strategy analysts and other professionals, was extraordinary. Also, we lacked important intelligence within the rebel government, which made contingencies even more vexing.
I co-authored the military Action Memo that SecState Dean Rusk hand carried to President Johnson. My personal concern about casualties was relentless.
That Trump/Hegseth act on whim and machismo regarding the lives of countless thousands makes me want to puke.
I so hear you. And if I hear the phrase "boots on the ground" one more time, I will scream and not be able to stop screaming. Real, live soldiers, Marines, airmen and sailors will wear those "boots". And some of them will bleed, suffer and die because of the whims of one man and his Band of Drunk on Power Sycophants. Saying "boots on the ground" is an attempt to make an abstraction of something that is horrifying.
LHS ‘Boots on the ground’ is a euphemism for putting the lives of military at risk, whether they are special forces going to Kharg Island or US warships being attacked in the Strait of Hormuz. It means countless dead and wounded Americans.
Trump/Hegseth have not made a valid case for why Americans should die for Trump’s Iranian folly.
Possibly, like Putin, the theocratic leaders of Iran are disinterested in the suffering imposed on their population by sanctions. A generation unemployed, an erratic electric grid, punished for aspiring to a state of personal rights, competent governance, choice.
Mickie What about the ‘Christian’ leaders Trump/Hegseth who don’t seem to care about killing people in Iran, the Caribbean/Pacific, cutting off critical health assistance in Africa and elsewhere, sharply cutting health care in America, and denying SNAP food to millions.
As for ‘non-Christian,’ Netanyahu has killed/wounded over 200,000 in Gaza, killed in West Bank, currently in Lebanon has killed perhaps 2,000, and is assassinating in Iran.
I agree that Iran is a failed state by various standards. Theocracy is partly to blame. Cuba is also a failed state—partly because US sanctions (and attempted invasion) against Castro more than 60 years ago. So now ‘strangle’ and enable Trump to ‘win’ it?
Biblically, ‘let he who is without sin cast the first stone.’ I spent years in the Middle East and Congo—ain’t uplifting. Now at 92 I can say the same about Trump’s America.
Leave I’ve led a rambunctious life and am fairly astute in identifying the good and bad folks. I was on the Nixon White House Enemies list, but never feared Nixon.
In sharp contrast, Trump and his cohorts are destroying my country and America’s presence in the world. I am dedicated to preserve the soul of America for my five grandchildren.
Anne Macho macho male pissing match. Trump/Hegseth are bullies ready to kill/murder countless thousands, but are truly pissed if any victim group fights back.
Whether it is ICE, ‘fishermen’ in Latin America, or ‘baddies’ in the Middle East, our macho leaders are cowardly, insensitive bullies.
Bone Spur Donald as commander in chief with a Fox News bloviator as Defense Secretary—as someone who voluntarily was a ‘sucker’ and almost a ‘loser’ serving my country, these two make me puke.
Leave Trump is targeting Cuba, a failed country. This makes no strategic sense, except as a Wag the Dog diversion.
Brazil is a different kettle of fish. Meanwhile, Xi is bebused at Trump playing checkers in a chess game. That Trump postpones his end of March meeting with Xi until the Iranian folly is over indicates Trump’s total failure to recognize that Xi has the upper hand.
Also, Trump is shifting military from Asia to ther Middle East/east. Trump now has no credibility or effective leverage with Xi. (I taught Chinese history for a few years and personally first rated the credit of Japan in 1975. I have a first hand insight into Asian thinking (and duplicity).
I believe Trump and this current administration, propped up by a complicit Republican party and pro-Netenyahu Democrats, like Putin and theocratic rulers in Iran are disinterested in the suffering of their constituents imposed by this war of choice. The results of Leadership running scared of the facts disclosed in the Epstein files.
I saw a discussion yesterday between Katty Kay of the BBC and Scaramucci of Trump's first administration. Both agree that Trump almost certainly will escalate; any other course makes him look like the weakling he is.
George I agree that Trump is likely to escalate his blitzkrieg, which will increase Iran’s efforts to retaliate at Strait of Hormuz and elsewhere.
After launching his ill-informed gut ‘excursion’ into Iran (with his buddy Bibi), he finds no ‘winning’ exit. Sounds like Vietnam, or Iraq, or Afghanistan.
Now will he try to blame America’s former allies for not sending military to clean up his mess? Another Trump READY, FIRE, OOPHS.
I love the idea of interdicting Iranian oil leaving the Gulf, but under what international law do we sink tankers because they're carrying cargo of which we don't approve? The imbecile-in-chief would be unlikely to go the the UN and might not get what he wanted if he did. And what happens when, say, we fire on a Chinese tanker carrying Iranian oil?
The only realistic choices are to negotiate limits on Iranian nuclear activities - an agreement we already had that Trump blew up - and that at least the Omanis claim we were on the doorstep of achieving again before the attack on February 28, or to announce to the world that the Islamic Republic is done and that the US has committed its full military weight to getting it done. This latter, of course, entirely illegal under international law but that hasn't stopped Trump yet. And of course the latter would almost certainly result in a minimum of several years of flag draped caskets and $200 billion funding requests to Congress.
Looked at from this remove, Trump is a collosal fuck-up, plain and simple, a man so far out of his depth it would be comical if it wasn't so scary. We had a deal that could have been built upon but Obama negotiated that so it had to be abrogated. We were on the cusp of a new deal that Trump's real estate buddy and his son-in-law were helping to shape but Bibi wanted to blow stuff up and that sounded like fun: hey khaver (~bubba in Yiddish), watch this!
You have hit on the main issue regarding oil. Carter placed an embargo on Iranian oil after the revolution. Other countries in the middle east bought Iranian oil and mixed it with their own. The result was that tankers carrying these mixes were turned back. People who lived in New Jersey at the time told me that news films of tankers being refused entry to Newark/New York played a big part in costing Carter the election.
Carter had the right to block entry to U.S. waters at the time (Trump has the same right). On the other hand, attacking ships outside of U.S. waters is called piracy.
I suspect Brooks and Windriven understate the risks of stopping Iranian exports forcibly. Iran's main customer is China. I doubt they will take kindly to having their supplies stopped. Suppose they decide to send the Chinese Navy to escort the tankers. Then what? The choice is between a humiliating climb down and war with China. Or if we occupy Kharg Island, maybe the Chinese close down rare earth exports again? Sure they could buy oil on the world market, but they don't have to put up with that inconvenience.
Clearly I didn't make my point which I intended to be that a confrontation with China would be certain. Thank you for underscoring that important reality.
GB, Your comment reveals that even the experts can fail to foresee or consider 2nd, 3rd, or 4th order effects of the policies they promote. Pretty scary. Also reinforces the importance of having a policy PROCESS wherein policy ideas informed by accumulated intelligence are discussed, tested, game played by professionals grounded in objectivity rather than Rupert Murdoch's "darlings" cosplaying as cabinet department heads.
I think all of the Iranian oil is going to China, but China is also buying oil from other countries in the Gulf. Iran is letting that through because China is an ally. Likely some for India too. Some reports say that if the oil is priced and paid for in Chinese Renminbi, Iran lets it through.
This doesn’t help the dollar’s role, but I don’t see the Renminbi taking over from the dollar any time soon. The Chinese have too many controls on moving RMB out of China and are too active in currency markets for the rest of the world to adopt it wholeheartedly. As countries move away from the dollar for reserves, they’ll end up balancing a lot of alternatives.
Paul has said before that the thing that's most scary is that the dollar loses its role as the reserve currency and nothing takes its place. I read elsewhere that we've been seeing a return to countries trading in their own currencies between each other. That author pointed out that this is the way the world worked before the World Wars, and that this sort of trading might cause similar friction.
"That option, in my opinion, is to do an embargo of Iranian oil to stop oil tankers leaving Kharg Island and other Iranian ports, and to starve the Iranian regime in that way economically, without using violence and warfare. "
This is maybe the dumbest idea concerning the Iran war that I've heard broached by anyone not in Trump's administration. Does Mr. Brooks not know what brought the U.S. into WW I? Apparently not. As a reminder, it was Germany's submarine embargo/blockade of England. Declaring an Iran oil embargo would be tantamount to declaring war on every neutral country that uses Iran's oil. And what happens when the ships of those sovereign states refuse to knuckle under to the embargo? Does Mr. Brooks really believe that shots wouldn't be fired at blockade runners? I don't. And if that happens, the U.S. will lose what little is left of the alliance systems that have done so much to keep it the world's number one power since WW II.
The U.S. navy may not even have the capability to impose an effective embargo. Naval embargoes require ships. And ships require crews. The navy is very short of both. It has the capability right now to fight a war for a couple of months, and that's it. All of our armed forces are like that. They've been hallowed out by bad management, a lack of funding, and the insane costs of weapons programs over the last 40 or so years.
So please, no more calls for naval embargoes of Iran. I'm not particularly interested in seeing the U.S. go to war with the rest of the world.
Here is the thing, Iran will eventually fall after we destroy the country and have unnecessarily spent trillions for the purpose of bolstering the political fortunes of Netanyahu and Trump. There is a nascent humanitarian crisis afoot in Iran where millions will die. MAGA will rationalize this carnage by saying it was worth the cost. Then they will complain about the national debt while ignoring the trillions spent trying to change Iran just like we did in Iraq and Afghanistan.
The hoi polloi pays for this at the pump and by having fewer services while energy producers reap windfall profits.
Trump has opened a new colonialism and imperialism with this attack. Now countries can use the tu quoque argument to invade another country. Trump has implicitly justified Russia’s invasion of Ukraine and China’s upcoming invasion of Taiwan.
I'm sorry but this discussion didn't make any sense to me.
Yes, the US Navy can embargo Iran's oil and cause massive shortfalls within Iran; but Iran can embargo everybody else's exports either by keeping the Strait closed and/or by blowing up their refining and pipeline facilities, so they don't get to export either. Iran can also cause a massive shortfall of fertilizer for the rest of the world -- 50% of Brazil's fertilizer comes through the Strait, and Iran is bombing Qatar's fertilizer production.
What does that do to Brazil's food exports to China? Where does that leave the rest of the world?
Obviously these experts know infinitely more than I do, but fleeting around from topic to topic seems counterproductive to me.
Sometimes wading through topics that are foreign territory is an exercise in discovering what we don't know. Not that I personally comprehend most of what was discussed, but it illuminates my own ignorance. There is probably a useful lesson there.
This is interview is why I am such a huge fan of this site. This was tremendously informative and it's not information I'm confident I could have gotten anywhere else. Thank you Paul. This kind of presentation is awesome.
It is a bummer that the assumed price elasticity of demand number for oil and gas price increases is so low in the short run.
Thanks for the expert heads up on all of this BTW.
However, one might certainly assume that there is more elasticity in purchases when things are also deemed socially unacceptable and now is a good time to go after the negatives of fossil fuel use and dependency.
Why isn't there more gas guzzler shaming and needless travel shaming (even if subtle - no one needs to be bullied)?
Honestly, there should be more attention given to this excess consumption as a negative and it should not be ignored.
Without this consumption.... there would be far fewer rich oil and other fossil fuel Trump enablers or businesses influencing sanctions and far less in CO2 emissions.
I mean, it really is all on us.
Seriously, if you follow the money it is mostly millions of ordinary folks propping up all of this profit and fossil fuel use.
How do we know this?
Covid
OPEC and the USA producers combined cut production by roughly 10 million BPD at one point due to a decrease in demand tanking the price for oil on global markets. The share of production decreases here was something like 3 million BPD, you can see it on EIA's weekly crude oil production for the U.S. starting in spring of 2020.
Or in a nutshell, a dramatic decline in consumption by millions here as well as perhaps billions globally impacted production in a big way as prices fell too low for it to be profitable to pull it out of the ground, ship it, and refine it, etc.
It is odd that so few consumers want to take personal responsibility in a serious way. We have already seen what a decline in demand can do during covid and it was huge.
It is also odd that so many simply say, well, we assume people "others" won't act, so we should not even bother to suggest it become a popular uprising of sorts or suggest we all cut the travel and staycation and drive less and get really serious about it.
We have evidence that it works.
However, by some saying this, they are giving others an excuse to avoid taking responsibility, but what we do really does matter.
We need a "Network" moment with someone saying ""I'm as mad as hell, and I'm not going to take this anymore!"
True, but even for those who are aware, not enough personal responsibility is taken. I can't afford an EV and even though I have what was once deemed an economy car, I feel guilty when I need to drive someplace - and I should.
That sense of personal responsibility means I am constantly putting off going to the store and finding ways to get what I need via other means (if a store has an electric delivery van) and waiting and combining trips and I know I could still do better.
Now, some people have to commute to work, and I get that, but most everyone, even them, can still do more and it makes an impact when all is combined.
I understand planes will be going from point A to B even when not full, but eventually fewer passengers cause fewer scheduled flights. I get that people need to see family and friends, but perhaps get rid of the blobbing on the beach in a foreign location for a while - not too much to ask to help save humanity and the planet for future generations. I mean seriously.
People make up excuses to do nothing (or not as much as they could) and indulge themselves because they do not want to take full personal responsibility or make any real sacrifices for the greater good.
The GOP base often pretends it is a "hoax." I think most know better but like most modern energy "addicts" want an excuse to keep "using" and many liberals seem to think or deceive themselves that "only" government can fix it, so wait for that, although they at least make some effort, but it will take more than just government effort to get this done on time, although that is truly needed, as well.
The truth is that we are all "addicted" to modern life and conveniences and spoiled and an addicted brain looks for excuses to keep getting the "fix" and is very good at deceiving (as any addict knows). Oh - the dopamine rush of travel and vacations and going places every day.
Like many addicts we are causing our own demise.
We are unbelievably spoiled from modern life, but one does not need to go back to the pioneer days to reduce one's impact. There are plenty of modern options that do not require a great deal of life changes, just making better choices.
I think many of us canceled amazon about a year and a half ago when he refused to let WaPo endorse Harris.
Amazon does have electric delivery vehicles though. If I have to buy something from them that I can't find elsewhere I simply refuse to do the Prime membership which goes to them only (even if they get a cut of 3rd party sellers).
I am an old lady who mostly wears sweats so no fast fashion here. I agree about what you suggest being good choices though.
I took one class in basic economics at college in the 1990's. I didn't do too bad. This conversation was over my head but what I realize is the multiple moving parts in the world. One thing affects another. I believe a balanced interdependence is vital to a peaceful world. I would like to see this conversation distilled down for lay folks like myself. I wonder what the visual would be? Probably a lot of arrows pointing to one thing or another. Thank you for your intelligence.
I took my classes in the early '70s. That part in here were they were talking about the days when economists felt that debt didn't matter rang a bell. That was the feeling in the classes I took.
I can see why Trump, his administration, and people like Mr. Witkoff and Mr. Kushner don't know enough to deal with the issues that surround this war. They are ill trained to sit in 'negotiations' with Iran, and Trump clearly wouldn't know a negotiation from a poorly played golf game. The Iran issues are complex and intertwined with political and business behaviors of a large number of actors over many decades. Mr. Brooks is a calm, deep thinker who has worked in that milieu and has helpful insights and information. We need people like this man working in government, but they have all been kicked out. Our President doesn't even read. He prefers the loudspeaker and crass short reels about life that suit his small predispositions. This does not bode well for the USA or the world, and I don't need to mention that. I do appreciate what Dr. Krugman is doing to help those of us who are interested in facts and information to make sense of everything that is going on. It helps as we turn away from Trump and figure out what we can do each day. Resting also helps. Going to do that now.
Economist Robin Brooks advocates a total embargo on Iranian exports (presumably oil, LNG, fertilizer, and helium) as an alternative to bombing -- at the exact moment when President Trump has lifted sanctions on Iranian oil in an effort to limit global price increases, while bombings by Israel and the USA continue. This dichotomy certainly deserves to be explored!
Question to you… I’ve heard talk that there’s ethnic cleansing and cultural quashing of Russians and Russian culture in Ukraine. And that corruption is rampant in Ukraine still. Any insight? Is this BS?
It’s largely Russian propaganda. But there is a real problem with the Russian Orthodox Church, which is run by Russian government agents (a practice that dates back to Soviet days) and had to suppressed in Ukraine.
Iran sees its neighbors as complicit in the attacks on it and in many cases they are correct. The US is conducting airstrikes from bases in some of these countries. From the Iranian perspective this is about the Crusaders and the Jews bullying the Shia, fellow Muslims. Secondarily, it is the tool at hand to inflict economic pain on the West. When you're fighting for survival you use whatever tools you have. The target countries aren't counterattacking because frankly this isn't their war. They didn't start it. And the Americans and Israelis are doing the it for them.
RATIONALITY, REVENGE, RETALIATION IN IRANIAN MORASS
I’m impressed by Robin Brooks who is extremely knowledgeable about sanctions. However, I feel that he may be overly rationale in a three-dimensional conflict involving a gut instinct Trump, response by a militarily-weakened Iran seeking to counter a blitzkrieg, and Netanyahu, who seems intent on destroying Iran.
I see this as a dangerous potential tit for tat escalation. Brooks seems to prefer draconian sanctions on Iranian oil to force Iran to reopen the Strait of Hormuz petroleum spigot.
I think it possible that Iran might be willing to play a game of chicken, hoping that the impact of of strait closing—and, possibly, the damage of major Arab production facilities—would trigger massive global economic disruption.
Long ago I spent years in the Middle East and even published a book. One thing I’ve learned is that any Middle Eastern prediction is tenuous. One action can set off domino reactions, which is what is occurring now.
WHEN ONE WANTS A COOL HAND LUKE, WE HAVE A GUT ‘MORALITY’ TRUMP WHO ESCHEWS ANY RATIONAL STRATEGY
I was thinking something similar while reading this. I was wishing we had smart, thoughtful people who can think ahead and see possible turns of events, like Dr. Krugman and Dr. Brooks, making policy or advising policymakers. But instead, we have President "feel it in my bones", Secretary of Defense "if I scream about being a warrior, maybe no one will notice what a corrupt, soulless person I am", Treasury Secretary "whatever Trump says is absolutely true" and others who act on whim and slavish devotion to Trump. The psychology angle is important, and both our allies and our enemies have figured out the psychology of the Trump regime.
LHS Many years ago I was point person as a Foreign Service Officer involved in the ultimate decision to use Belgian paratroopers with US support to rescue about 3,000 foreigners under death threat from a rebel Congolese government.
The amount of staff work, from the president down to a range of strategy analysts and other professionals, was extraordinary. Also, we lacked important intelligence within the rebel government, which made contingencies even more vexing.
I co-authored the military Action Memo that SecState Dean Rusk hand carried to President Johnson. My personal concern about casualties was relentless.
That Trump/Hegseth act on whim and machismo regarding the lives of countless thousands makes me want to puke.
I so hear you. And if I hear the phrase "boots on the ground" one more time, I will scream and not be able to stop screaming. Real, live soldiers, Marines, airmen and sailors will wear those "boots". And some of them will bleed, suffer and die because of the whims of one man and his Band of Drunk on Power Sycophants. Saying "boots on the ground" is an attempt to make an abstraction of something that is horrifying.
LHS ‘Boots on the ground’ is a euphemism for putting the lives of military at risk, whether they are special forces going to Kharg Island or US warships being attacked in the Strait of Hormuz. It means countless dead and wounded Americans.
Trump/Hegseth have not made a valid case for why Americans should die for Trump’s Iranian folly.
Possibly, like Putin, the theocratic leaders of Iran are disinterested in the suffering imposed on their population by sanctions. A generation unemployed, an erratic electric grid, punished for aspiring to a state of personal rights, competent governance, choice.
Mickie What about the ‘Christian’ leaders Trump/Hegseth who don’t seem to care about killing people in Iran, the Caribbean/Pacific, cutting off critical health assistance in Africa and elsewhere, sharply cutting health care in America, and denying SNAP food to millions.
As for ‘non-Christian,’ Netanyahu has killed/wounded over 200,000 in Gaza, killed in West Bank, currently in Lebanon has killed perhaps 2,000, and is assassinating in Iran.
I agree that Iran is a failed state by various standards. Theocracy is partly to blame. Cuba is also a failed state—partly because US sanctions (and attempted invasion) against Castro more than 60 years ago. So now ‘strangle’ and enable Trump to ‘win’ it?
Biblically, ‘let he who is without sin cast the first stone.’ I spent years in the Middle East and Congo—ain’t uplifting. Now at 92 I can say the same about Trump’s America.
Leave I’ve led a rambunctious life and am fairly astute in identifying the good and bad folks. I was on the Nixon White House Enemies list, but never feared Nixon.
In sharp contrast, Trump and his cohorts are destroying my country and America’s presence in the world. I am dedicated to preserve the soul of America for my five grandchildren.
I’m going for Trump’s jugular.
Is the US interested in the problems the war is causing any civilian including Americans?
Kind of looks like a giant male pissing match.
Anne Macho macho male pissing match. Trump/Hegseth are bullies ready to kill/murder countless thousands, but are truly pissed if any victim group fights back.
Whether it is ICE, ‘fishermen’ in Latin America, or ‘baddies’ in the Middle East, our macho leaders are cowardly, insensitive bullies.
Bone Spur Donald as commander in chief with a Fox News bloviator as Defense Secretary—as someone who voluntarily was a ‘sucker’ and almost a ‘loser’ serving my country, these two make me puke.
Hegseth like attacking unarmed small boats. A lot less scary than opening the Strait of Hormuz.
Leave Trump is targeting Cuba, a failed country. This makes no strategic sense, except as a Wag the Dog diversion.
Brazil is a different kettle of fish. Meanwhile, Xi is bebused at Trump playing checkers in a chess game. That Trump postpones his end of March meeting with Xi until the Iranian folly is over indicates Trump’s total failure to recognize that Xi has the upper hand.
Also, Trump is shifting military from Asia to ther Middle East/east. Trump now has no credibility or effective leverage with Xi. (I taught Chinese history for a few years and personally first rated the credit of Japan in 1975. I have a first hand insight into Asian thinking (and duplicity).
I believe Trump and this current administration, propped up by a complicit Republican party and pro-Netenyahu Democrats, like Putin and theocratic rulers in Iran are disinterested in the suffering of their constituents imposed by this war of choice. The results of Leadership running scared of the facts disclosed in the Epstein files.
I saw a discussion yesterday between Katty Kay of the BBC and Scaramucci of Trump's first administration. Both agree that Trump almost certainly will escalate; any other course makes him look like the weakling he is.
George I agree that Trump is likely to escalate his blitzkrieg, which will increase Iran’s efforts to retaliate at Strait of Hormuz and elsewhere.
After launching his ill-informed gut ‘excursion’ into Iran (with his buddy Bibi), he finds no ‘winning’ exit. Sounds like Vietnam, or Iraq, or Afghanistan.
Now will he try to blame America’s former allies for not sending military to clean up his mess? Another Trump READY, FIRE, OOPHS.
More shit on his gilded Florsheims.
He is already blaming NATO nations for not piling in to help.
I love the idea of interdicting Iranian oil leaving the Gulf, but under what international law do we sink tankers because they're carrying cargo of which we don't approve? The imbecile-in-chief would be unlikely to go the the UN and might not get what he wanted if he did. And what happens when, say, we fire on a Chinese tanker carrying Iranian oil?
The only realistic choices are to negotiate limits on Iranian nuclear activities - an agreement we already had that Trump blew up - and that at least the Omanis claim we were on the doorstep of achieving again before the attack on February 28, or to announce to the world that the Islamic Republic is done and that the US has committed its full military weight to getting it done. This latter, of course, entirely illegal under international law but that hasn't stopped Trump yet. And of course the latter would almost certainly result in a minimum of several years of flag draped caskets and $200 billion funding requests to Congress.
Looked at from this remove, Trump is a collosal fuck-up, plain and simple, a man so far out of his depth it would be comical if it wasn't so scary. We had a deal that could have been built upon but Obama negotiated that so it had to be abrogated. We were on the cusp of a new deal that Trump's real estate buddy and his son-in-law were helping to shape but Bibi wanted to blow stuff up and that sounded like fun: hey khaver (~bubba in Yiddish), watch this!
You have hit on the main issue regarding oil. Carter placed an embargo on Iranian oil after the revolution. Other countries in the middle east bought Iranian oil and mixed it with their own. The result was that tankers carrying these mixes were turned back. People who lived in New Jersey at the time told me that news films of tankers being refused entry to Newark/New York played a big part in costing Carter the election.
Carter had the right to block entry to U.S. waters at the time (Trump has the same right). On the other hand, attacking ships outside of U.S. waters is called piracy.
I suspect Brooks and Windriven understate the risks of stopping Iranian exports forcibly. Iran's main customer is China. I doubt they will take kindly to having their supplies stopped. Suppose they decide to send the Chinese Navy to escort the tankers. Then what? The choice is between a humiliating climb down and war with China. Or if we occupy Kharg Island, maybe the Chinese close down rare earth exports again? Sure they could buy oil on the world market, but they don't have to put up with that inconvenience.
Clearly I didn't make my point which I intended to be that a confrontation with China would be certain. Thank you for underscoring that important reality.
Thanks. It was your idea really. Grenville
GB, Your comment reveals that even the experts can fail to foresee or consider 2nd, 3rd, or 4th order effects of the policies they promote. Pretty scary. Also reinforces the importance of having a policy PROCESS wherein policy ideas informed by accumulated intelligence are discussed, tested, game played by professionals grounded in objectivity rather than Rupert Murdoch's "darlings" cosplaying as cabinet department heads.
Iran is supposedly letting oil bound for China through. I heard they were charging a toll, or perhaps just thinking about it.
I thought it was Iranian oil being sold to China.
Yes, it’s Iranian oil. I did hear that some got to India as well as China.
I think all of the Iranian oil is going to China, but China is also buying oil from other countries in the Gulf. Iran is letting that through because China is an ally. Likely some for India too. Some reports say that if the oil is priced and paid for in Chinese Renminbi, Iran lets it through.
So much for the U.S. lock on the reserve currency.
This doesn’t help the dollar’s role, but I don’t see the Renminbi taking over from the dollar any time soon. The Chinese have too many controls on moving RMB out of China and are too active in currency markets for the rest of the world to adopt it wholeheartedly. As countries move away from the dollar for reserves, they’ll end up balancing a lot of alternatives.
Paul has said before that the thing that's most scary is that the dollar loses its role as the reserve currency and nothing takes its place. I read elsewhere that we've been seeing a return to countries trading in their own currencies between each other. That author pointed out that this is the way the world worked before the World Wars, and that this sort of trading might cause similar friction.
"That option, in my opinion, is to do an embargo of Iranian oil to stop oil tankers leaving Kharg Island and other Iranian ports, and to starve the Iranian regime in that way economically, without using violence and warfare. "
This is maybe the dumbest idea concerning the Iran war that I've heard broached by anyone not in Trump's administration. Does Mr. Brooks not know what brought the U.S. into WW I? Apparently not. As a reminder, it was Germany's submarine embargo/blockade of England. Declaring an Iran oil embargo would be tantamount to declaring war on every neutral country that uses Iran's oil. And what happens when the ships of those sovereign states refuse to knuckle under to the embargo? Does Mr. Brooks really believe that shots wouldn't be fired at blockade runners? I don't. And if that happens, the U.S. will lose what little is left of the alliance systems that have done so much to keep it the world's number one power since WW II.
The U.S. navy may not even have the capability to impose an effective embargo. Naval embargoes require ships. And ships require crews. The navy is very short of both. It has the capability right now to fight a war for a couple of months, and that's it. All of our armed forces are like that. They've been hallowed out by bad management, a lack of funding, and the insane costs of weapons programs over the last 40 or so years.
So please, no more calls for naval embargoes of Iran. I'm not particularly interested in seeing the U.S. go to war with the rest of the world.
And a relatively few drones from Iran could take out or seriously impair those ships. And kill plenty of sailors.
Here is the thing, Iran will eventually fall after we destroy the country and have unnecessarily spent trillions for the purpose of bolstering the political fortunes of Netanyahu and Trump. There is a nascent humanitarian crisis afoot in Iran where millions will die. MAGA will rationalize this carnage by saying it was worth the cost. Then they will complain about the national debt while ignoring the trillions spent trying to change Iran just like we did in Iraq and Afghanistan.
The hoi polloi pays for this at the pump and by having fewer services while energy producers reap windfall profits.
Trump has opened a new colonialism and imperialism with this attack. Now countries can use the tu quoque argument to invade another country. Trump has implicitly justified Russia’s invasion of Ukraine and China’s upcoming invasion of Taiwan.
Iran could hold out for a while.
MAGA won't rationalize it - they won't even know about it. https://www.youtube.com/watch?v=bVy-Iag4Qtk
I'm sorry but this discussion didn't make any sense to me.
Yes, the US Navy can embargo Iran's oil and cause massive shortfalls within Iran; but Iran can embargo everybody else's exports either by keeping the Strait closed and/or by blowing up their refining and pipeline facilities, so they don't get to export either. Iran can also cause a massive shortfall of fertilizer for the rest of the world -- 50% of Brazil's fertilizer comes through the Strait, and Iran is bombing Qatar's fertilizer production.
What does that do to Brazil's food exports to China? Where does that leave the rest of the world?
Obviously these experts know infinitely more than I do, but fleeting around from topic to topic seems counterproductive to me.
Sometimes wading through topics that are foreign territory is an exercise in discovering what we don't know. Not that I personally comprehend most of what was discussed, but it illuminates my own ignorance. There is probably a useful lesson there.
Brazil can get fertilizer from Canada.
Great points
This is interview is why I am such a huge fan of this site. This was tremendously informative and it's not information I'm confident I could have gotten anywhere else. Thank you Paul. This kind of presentation is awesome.
It is a bummer that the assumed price elasticity of demand number for oil and gas price increases is so low in the short run.
Thanks for the expert heads up on all of this BTW.
However, one might certainly assume that there is more elasticity in purchases when things are also deemed socially unacceptable and now is a good time to go after the negatives of fossil fuel use and dependency.
Why isn't there more gas guzzler shaming and needless travel shaming (even if subtle - no one needs to be bullied)?
Honestly, there should be more attention given to this excess consumption as a negative and it should not be ignored.
Without this consumption.... there would be far fewer rich oil and other fossil fuel Trump enablers or businesses influencing sanctions and far less in CO2 emissions.
I mean, it really is all on us.
Seriously, if you follow the money it is mostly millions of ordinary folks propping up all of this profit and fossil fuel use.
How do we know this?
Covid
OPEC and the USA producers combined cut production by roughly 10 million BPD at one point due to a decrease in demand tanking the price for oil on global markets. The share of production decreases here was something like 3 million BPD, you can see it on EIA's weekly crude oil production for the U.S. starting in spring of 2020.
Or in a nutshell, a dramatic decline in consumption by millions here as well as perhaps billions globally impacted production in a big way as prices fell too low for it to be profitable to pull it out of the ground, ship it, and refine it, etc.
It is odd that so few consumers want to take personal responsibility in a serious way. We have already seen what a decline in demand can do during covid and it was huge.
It is also odd that so many simply say, well, we assume people "others" won't act, so we should not even bother to suggest it become a popular uprising of sorts or suggest we all cut the travel and staycation and drive less and get really serious about it.
We have evidence that it works.
However, by some saying this, they are giving others an excuse to avoid taking responsibility, but what we do really does matter.
We need a "Network" moment with someone saying ""I'm as mad as hell, and I'm not going to take this anymore!"
Great point. Many Americans (77m or so) are not keen on self sacrifice. Full size trucks and SUVs are a God-given right, don't you know?
True, but even for those who are aware, not enough personal responsibility is taken. I can't afford an EV and even though I have what was once deemed an economy car, I feel guilty when I need to drive someplace - and I should.
That sense of personal responsibility means I am constantly putting off going to the store and finding ways to get what I need via other means (if a store has an electric delivery van) and waiting and combining trips and I know I could still do better.
Now, some people have to commute to work, and I get that, but most everyone, even them, can still do more and it makes an impact when all is combined.
I understand planes will be going from point A to B even when not full, but eventually fewer passengers cause fewer scheduled flights. I get that people need to see family and friends, but perhaps get rid of the blobbing on the beach in a foreign location for a while - not too much to ask to help save humanity and the planet for future generations. I mean seriously.
People make up excuses to do nothing (or not as much as they could) and indulge themselves because they do not want to take full personal responsibility or make any real sacrifices for the greater good.
The GOP base often pretends it is a "hoax." I think most know better but like most modern energy "addicts" want an excuse to keep "using" and many liberals seem to think or deceive themselves that "only" government can fix it, so wait for that, although they at least make some effort, but it will take more than just government effort to get this done on time, although that is truly needed, as well.
The truth is that we are all "addicted" to modern life and conveniences and spoiled and an addicted brain looks for excuses to keep getting the "fix" and is very good at deceiving (as any addict knows). Oh - the dopamine rush of travel and vacations and going places every day.
Like many addicts we are causing our own demise.
We are unbelievably spoiled from modern life, but one does not need to go back to the pioneer days to reduce one's impact. There are plenty of modern options that do not require a great deal of life changes, just making better choices.
Just cancel amazon and fast fashion. Start there.
I think many of us canceled amazon about a year and a half ago when he refused to let WaPo endorse Harris.
Amazon does have electric delivery vehicles though. If I have to buy something from them that I can't find elsewhere I simply refuse to do the Prime membership which goes to them only (even if they get a cut of 3rd party sellers).
I am an old lady who mostly wears sweats so no fast fashion here. I agree about what you suggest being good choices though.
Totally agree. Thanks
Paul closes with, "I wish things would be a lot less exciting"
"May you live in interesting times" was not originally intended as a toast. It was originally a curse. It has become so again it seems.
I took one class in basic economics at college in the 1990's. I didn't do too bad. This conversation was over my head but what I realize is the multiple moving parts in the world. One thing affects another. I believe a balanced interdependence is vital to a peaceful world. I would like to see this conversation distilled down for lay folks like myself. I wonder what the visual would be? Probably a lot of arrows pointing to one thing or another. Thank you for your intelligence.
My takeaway on the war is that we really don’t know what’s going to happen. There are so many wild cards.
I took my classes in the early '70s. That part in here were they were talking about the days when economists felt that debt didn't matter rang a bell. That was the feeling in the classes I took.
What an incredibly great conversation!
Please have him on again soon. I loved hearing the two of you discuss these issues. Thank you both!
I can see why Trump, his administration, and people like Mr. Witkoff and Mr. Kushner don't know enough to deal with the issues that surround this war. They are ill trained to sit in 'negotiations' with Iran, and Trump clearly wouldn't know a negotiation from a poorly played golf game. The Iran issues are complex and intertwined with political and business behaviors of a large number of actors over many decades. Mr. Brooks is a calm, deep thinker who has worked in that milieu and has helpful insights and information. We need people like this man working in government, but they have all been kicked out. Our President doesn't even read. He prefers the loudspeaker and crass short reels about life that suit his small predispositions. This does not bode well for the USA or the world, and I don't need to mention that. I do appreciate what Dr. Krugman is doing to help those of us who are interested in facts and information to make sense of everything that is going on. It helps as we turn away from Trump and figure out what we can do each day. Resting also helps. Going to do that now.
Economist Robin Brooks advocates a total embargo on Iranian exports (presumably oil, LNG, fertilizer, and helium) as an alternative to bombing -- at the exact moment when President Trump has lifted sanctions on Iranian oil in an effort to limit global price increases, while bombings by Israel and the USA continue. This dichotomy certainly deserves to be explored!
DATELINE KYIV - DAY 1487 : 4413
Gents,
Excellent conversation. Timely, insightful, and informative. Lucid and sobering, too.
Thank you.
V/r - IB
An American in Ukraine
(2019 - Present)
Question to you… I’ve heard talk that there’s ethnic cleansing and cultural quashing of Russians and Russian culture in Ukraine. And that corruption is rampant in Ukraine still. Any insight? Is this BS?
It’s largely Russian propaganda. But there is a real problem with the Russian Orthodox Church, which is run by Russian government agents (a practice that dates back to Soviet days) and had to suppressed in Ukraine.
'Why is Iran bombing its neighbors? and why aren't they striking back?
Iran sees its neighbors as complicit in the attacks on it and in many cases they are correct. The US is conducting airstrikes from bases in some of these countries. From the Iranian perspective this is about the Crusaders and the Jews bullying the Shia, fellow Muslims. Secondarily, it is the tool at hand to inflict economic pain on the West. When you're fighting for survival you use whatever tools you have. The target countries aren't counterattacking because frankly this isn't their war. They didn't start it. And the Americans and Israelis are doing the it for them.
bingo
they are attacking those gulf coutries that have US facilities there
There's one problem with the Saudi's pipeline well actually not the pipeline the pumping station is down and has been day 19 and 20 of the war.
Apparently the Saudi Red Sea terminal has been attacked by Iran.
https://maritime-executive.com/article/saudi-arabia-loses-patience-as-red-sea-terminal-and-refinery-are-targeted
Another problem is likely to be the Houthis in Yemen.