There’s a persistent myth that President Donald Trump knows what he’s doing. That his actions are strategic, rather than impulsive. That he’s “playing 4D chess” — anticipating, manipulating and generally outthinking opponents. That anything he breaks he can put back together — on terms more favorable to himself — or will keep operating regardless. So don’t worry.
This still-prevalent view has reached its limit with the Iran war, even if many haven’t realized it yet.
Here are three reality checks:
Reality check 1: Economic disruption is already locked in and growing daily.
A good amount of the media coverage has treated the Iran war as another bit of Trump-caused chaos that he can wind down whenever he wants, just as his tariff blitz unsettled markets but things mostly kept functioning regardless. Stock markets are acting that way, too, with the Dow, S&P 500 and Nasdaq all at or near record highs.
But the global economy is already broken and Trump can’t fix it. The earthquake has hit; the ensuing tsunami just hasn’t reached our shores yet.
The last ships to make it out of the Persian Gulf, before Iran blocked the Strait of Hormuz, have reached their destinations and are unloading. The global economic system assumes more will arrive on a regular basis, except this time they won’t. Corporations and governments will tap reserves, which will delay the pain, but there isn’t enough in storage to cover the shortfall.
If it goes on for a while, demand will shrink in response, but that adjustment will take years. In the meantime, a portion of global demand for oil, natural gas, fertilizer and other essentials will go unmet.
It’s hitting Asia first — seen, for example, in sharp rises in airfare costs — because that’s where most of the ships out of the Gulf go. But it will reverberate everywhere.
The global economy is already broken and Trump can’t fix it. The earthquake has hit; the ensuing tsunami just hasn’t reached our shores yet.
To avoid canceling contracts or shutting down, most companies will chase existing supply, offering to pay more. Producers across the world will sell as much as they can, charging whatever the market will pay, but there’s no spare capacity they can quickly tap to make up the shortfall caused by the Hormuz shutdown.
Resulting shortages and price increases will raise the cost of everything downstream — gasoline, food, washing machines, you name it — and increase inflation overall.
This process is already underway, seen in an unusually high number of tankers going to the Gulf of Mexico, causing backups at American facilities. Secretary of Defense Pete Hegseth bragged that ships are lining up, which only shows that he doesn’t understand that a backup is the opposite of things running smoothly. It means something has gone wrong. U.S. energy companies could make windfall profits, but for almost everyone else, this means higher prices.
Economic disruption is already locked in, even if the U.S. and Iran agree to open the strait tomorrow. The Pentagon says Iran-laid mines could take six months to remove. Then the shipping backlog has to clear. Only then will Hormuz be open.
Even the best-case scenario for Trump involves considerable economic damage. And it doesn’t appear likely.
Reality check 2: There’s barely a peace process and the sides aren’t close.
The Pakistan-mediated U.S.-Iran ceasefire started on April 8, but the war and associated economic disruption continues. While missiles aren’t flying at the moment, Iran’s block of Hormuz and the U.S. Navy’s counterblockade of Iranian shipping remain in place.
Trump is still issuing demands, such as total cessation of Iran’s nuclear program, as if the U.S. has more leverage. Meanwhile, Iran’s leadership — which at this point is predominantly comprised of the Islamic Revolutionary Guard Corps — demands concessions to reopen Hormuz, which had freedom of navigation before Trump attacked. No matter how many times Trump says Iran “has no cards,” it clearly does, and with the pending global energy supply crunch, time is on its side.
The Trump White House has been so erratic, with a long record of reneging on promises and changing stances, that Iran can’t trust that the U.S. will honor any agreement rather than attack again in a few months. Under Trump, America has no credibility, which makes it hard to get a deal even if the Iranians wanted one.
Economic problems are mounting, and Trump can’t even get Iran to agree on a framework for negotiations. He’s not close to a real peace that allows commerce to fully resume, let alone a deal in which the U.S. wins concessions.
Reality check 3: Events are mostly out of Trump’s control.
Trump started the Iran war, but now that the Iranian regime has survived the initial assault and established its block of Hormuz, Iran is more in control of events.
Physical reality is real, no matter how hard Trump insists it isn’t. America can collectively pretend for a time, but that has its limits, and usually makes the reckoning worse.
In that way, the Iran war is like the Covid-19 pandemic. Trump’s initial response in 2020 was trying to hide the number of cases and telling everyone the virus would simply go away. It didn’t, and Trump’s mismanagement oversaw a higher pandemic death rate in the U.S. compared to other wealthy countries.
Some things are too big for Trump to lie his way through.
No matter how many times Trump says Iran “has no cards,” it clearly does, and with the pending global energy supply crunch, time is on its side.
With Iran, Trump’s options are accepting a humiliating defeat or escalating, which could end up in a more costly humiliation. Not wanting to do either, he’s strung things along, pretending that a deal is imminent (the two sides can’t even agree on what to talk about), that Iran is eager to make one (the U.S., not Iran, is clearly more desperate) and that he called off recently scheduled talks (the Iranians did, and afterward Trump pretended it was his idea).
But as economic problems multiply over the coming months, reality will become increasingly unignorable. And unlike the pandemic, this crisis is entirely of Trump’s own making.
Contrary to popular myth, Trump was never good at business or at making deals. Bluster isn’t really strength. Threats and bombing from afar don’t make other countries capitulate. Working with allies has made America stronger, not weaker. And launching this war without legal authorization, allied support or a good strategy for success has empowered Iran, harming the U.S. in the process.
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