CORNERED state is how geopolitics commentator Jiang Xueqin describes Iran’s recent policy of stopping petrochemicals, steel and other key exports. On his popular YouTube channel “Predictive History,” the Beijing high school philosophy instructor, who predicted Donald Trump’s 2024 victory and the current war, saw in Iran’s economy turning inward Japan’s own isolationist move before attacking Pearl Harbor in 1941.
Whether or not Tehran is reprising Tokyo’s wartime path, the former is certainly reaching out for support, with Foreign Minister Abbas Araghchi visiting Pakistan and Russia as negotiations with the United States stall and attacks continue despite the three-week ceasefire. Also ominously, China has ordered its massive tanker fleet to suspend sailings and return home.
Does Beijing fear renewed Gulf hostilities and want to keep its ships safe? Is Iran shoring up resources and firming up alliances before hostilities escalate? Adding to worries is a recent remark attributed to US President Trump that Iran “only understands bombs.” And Israel continues to exchange threats and strikes with Iran-backed Hezbollah militants in southern Lebanon despite the week-old ceasefire there.
Whither the war?
Where is this war going? Some possible directions, based on battlefield realities:
First, escalation seems unlikely, at least for Iran, which wants to avoid more destruction, and the US, which has been running low on precision guided munitions (PGMs), most crucially for air defense.
Iran’s central bank has reportedly advised President Masoud Pezeshkian that postwar reconstruction and recovery could take 12 years. The Iranian rial has plunged in value from $2.38 in January to 8 cents in March amid food prices doubling in February, forcing the government to issue the largest paper currency denomination of 10 million rial. The International Monetary Fund (IMF) expects the Iranian economy to shrink 6 percent in 2026.
Nor is America keen to resume full-scale missile, drone and bombing hostilities with US, Israeli and allied air defenses across the Middle East still low in PGMs and blinded by Iran’s destruction of billion-dollar anti-missile radar installations.
Top Washington think tank Center for Strategic and International Studies estimates that half of US stockpiles of PGMs, Patriot and high-altitude THAAD projectiles are down by half and could take four years to replenish (https://tinyurl.com/yvzsk7er). Hence, if attacks resume, America and allied nations can hardly defend against Iranian ordnance, which remain well-protected against attack in underground and mountain fortresses.
No wonder President Trump keeps extending the ceasefire even though serious negotiations with Tehran — his condition for suspending hostilities — remain stalled. This is despite his repeated mistaken claims that Vice President JD Vance and other top US negotiators are flying to Pakistan’s capital Islamabad for talks.
In the latest turn in Washington — and surely not the last — the Trump administration is supposedly considering Tehran’s latest proposed terms to end the war, but with no deal yet on the Iranian nuclear program. US Secretary of State Marco Rubio nixed the idea, but his boss may just be desperate enough for a war exit ramp to OK it.
World downturn ahead
The main pressure on Trump to end the war and avoid painful economic fallout for Americans is the November midterm elections, which could give the rival Democratic Party control of both chambers of the US Congress.
That loss would lead to Trump being impeached for a third time after the House did it twice in his first term, though Republican senators voted against conviction and removal. But if the Senate falls into opposition hands in the midterms, Trump may just become the first president ousted by impeachment.
Facing this November threat, Trump will likely avoid war escalation that would bloody many American soldiers — like ground invasion of Iran — or further devastate US assets and allies in the Middle East — sure to happen if missile warfare resumes while anti-missile defenses remain weak.
What about the economic impact? The IMF warns of a global recession in a prolonged Middle East war and Strait of Hormuz closure, with world economic growth falling well below 3 percent.
But being the planet’s top petroleum producer and a net energy exporter, the US is avoiding the worst of the war’s inflationary spike. Still, Americans are not totally spared with gasoline prices up $1 a gallon on the $4 average. And if the global energy and fertilizer crunch continues for very long, US inflation, jobs and growth will worsen — undermining Republicans at the hustings.
And if the world tips into a grave recession, America will also suffer from reduced exports and investment, including the hundreds of billions of financial inflows buying up US Treasury bills needed to fund mammoth government deficits and keep interest rates down.
But world economic distress — even the threat of global food crisis due to a third of world fertilizer shipments stuck in the Gulf — is not uppermost in Trump’s mind. Nor does it bother Israel Prime Minister Benjamin Netanyahu, who got Trump to attack Iran despite top American security officials dismissing Israeli claims that Tehran’s leaders would be ousted after then-supreme leader Ayatollah Ali Khamenei was killed.
And that’s the mammoth danger today: America and Israel are increasingly isolated, with even longtime European allies like the British and the Germans openly decrying the war.
We pray this isolation does not spur Trump and Netanyahu to act even more recklessly and to hell with the world.