Jul.14

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It's a Whole New Iran War... Apparently

Yesterday, Politico reported that it has seen a copy of a letter that Donald Trump sent to Congress on July 10, advising the members that the United States is "once again" at war with Iran, and that the strikes against Iran that took place on July 7 were "military action consistent with my responsibility to protect Americans and United States' interests both at home and abroad."

The framing that the White House is pushing here is entirely unsubtle. To wit:

1. There was a war
2. The war ended with a ceasefire agreement
3. Now there is a new war

Presumably, we should now be referring to the war that started back in March as Iran War I, and the war that began on July 7 as Iran War II. All we know for sure is that if Trump is not careful, he might end up starting World War III.

If you accept this framing, then it means the timer on the 60-day limit imposed by the War Powers Act (which is actually, de facto, a 90-day limit) starts over. This is, on its face, ridiculous. First of all, if you're fighting a war in a place in [MONTH X] and you're still fighting a war in that same place in [MONTH X+1], it's the same damn war. During the Revolutionary and Civil Wars, they often did not fight for several months in the winter, because it was too difficult to do so, and yet nobody then or now thought either of those conflicts was three or four or five separate wars. Second, despite the fact that a ceasefire was announced, and despite the fact that Trump declared victory at least a dozen times, the firing never actually ceased. We don't know the exact timeline, but we wouldn't be surprised to learn that there wasn't even a 72-hour period with no exchange of fire. Certainly, there was never a full week of peace, much less a month or more.

All of this said, Congress isn't going to do a damn thing to actually try to enforce the limits that Trump is supposed to be operating under. First, because this Congress never holds Trump accountable for anything. Second, because the members (including many Democrats) don't have any interest in taking the slightest ownership of these kinds of foreign conflicts. If they step in and stop the war in Iran, and then Iran starts nuclear tests 6 months later or blows up an American passenger plane or something like that, then the members of Congress get much of the blame. If they grant permission to Trump to go to war, and then the war turns into a quagmire, then the members of Congress get much of the blame (see what happened to some members who voted for the authorization of military force in Iraq).

Letting the war be entirely of Trump's volition keeps the members' hands as clean as is possible, politically. It is true that some Republican members might be punished in November for looking the other way. But most or all of those members would likely be swept up in general "throw out the bums" sentiment anyhow. As to the Democrats, they can squawk and carp about the war, and try to get enough Republican votes to pass "end the Iran War" resolutions. And those Democrats, by and large, probably do believe the war should end. But because "end the war" resolutions would have to be signed by Trump, and because neither that nor a veto override is going to happen, Democrats can be loudly antiwar without risking ownership of any consequences that might come from ending the war (see what happened to Joe Biden when he quite correctly ended the Afghanistan War).

Once the cat was out of the bag, Trump went on Hugh Hewitt's program and did some peacocking, decreeing:

We're gonna hit 'em very hard tonight, and we're gonna hit 'em hard tomorrow. And there's not a damn thing they can do about it. They have nothing—they have nothing going except they have big mouths.

By the time you read this, the hard hits promised "tonight" will presumably have taken place. That said, there is no indication whatsoever that Trump has a new strategy for winning the war. Yet again, he's falling back on "the U.S. will flex its muscles, and Iran will suffer." Of course, the U.S. has flexed its muscles plenty, and Iran has suffered plenty, and the war is no closer to a conclusion. One cannot help but think of the definition of insanity often incorrectly attributed to Albert Einstein: "doing the same thing over and over again and expecting different results."

There is one new wrinkle, however. Yesterday, after revealing to everyone that the Iran War is on "again," Trump got on his social media platform for those who are compensating for... something, and made this announcement:

The Hormuz Strait is OPEN, and will remain OPEN, with or without Iran. We are reinstating the THE IRANIAN BLOCKADE, so named because it is only stopping Iran's ships or customers from entering or leaving. All other countries will have fair and open use of the Strait. The U.S.A. will be, from this point forward, known as "THE GUARDIAN OF THE HORMUZ STRAIT," but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World. The process and formation will begin immediately. Thank you for your attention to this matter! President DONALD J. TRUMP

This will do nothing to help end the war. However, it is ostensibly meant to address the problem that Trump actually cares about, which is oil prices. And, in a Trumpy version of trying to take lemons and make lemonade, he's trying to turn this into an opportunity to profit by shaking down the oil carriers of the world.

We know Trump does not think through the implications of his policy choices. Truth be told, he might not be capable of doing so in anything approaching a rigorous manner. But some of the people around him must be aware of the implications, right? Right? Assuming that is correct, is the problem that they are unwilling to challenge him? Or that they cannot persuade him? In any event, it took us all of 5 minutes to notice these five rather substantial flies in the ointment (well, in the oil):

1. Despite Trump's assertions to the contrary, the U.S. does not currently control the Strait of Hormuz. Any effort to seize control will be difficult, if not impossible, and the Iranians will resist mightily with mines, drones and any other means at their disposal. And what is the White House going to do if a U.S. ship is sunk, and dozens or hundreds of sailors die, in the name of "oil escorts"?
   
   
2. On a similar point, if the U.S. Navy does try to provide escorts, both the ship(s) doing the escorting, and the ship(s) being escorted are going to have giant targets on them. Are the insurers of the oil tankers going to be willing to bear the risk?
   
   
3. The oil business is run on tight margins. Usually, transport costs are about 2%-3% of the value of the oil being transported. Suddenly increasing costs to 22%-23% would blow a giant hole in the entire business model.
   
   
4. Trump might be aware that the U.S. toll will increase costs, and might be telling himself that the oil companies will suck it up and pay and will just pass the costs on to their customers. And since most of the oil that goes through the Strait is not headed to the U.S., he might reason, then too bad for those customers. However, the oil market is a global market. If prices outside the U.S. go way up, demand for U.S. oil will go up, such that U.S. oil prices will eventually reach an equilibrium with international prices.
   
   
5. Oh, and charging tolls for use of international shipping lanes, whether it's Iran doing it or the U.S. doing it, is a violation of international law.

It would seem our skepticism was warranted. Brent crude, which is the de facto global benchmark for oil prices, closed at $76/barrel on Friday. At the open of business yesterday, it was $77/barrel. As of this writing, around 1:00 a.m. PT, it had shot up to $86/barrel.

Since Trump keeps running the same playbook over and over, we have no idea when or how this is going to end. He seems to have given up on the idea of achieving peace in time for the midterms, and now he's trying to fix gas prices through brute force. That's not going to work, for the reasons we outline above, and the markets are already showing us that it won't work. Once Operation Shakedown fails, then what? Does he order a land invasion, which would be disastrous? Send J.D. Vance and his band of merry men to negotiate another meaningless truce? Wash his hands of the whole thing and tell the Republicans running for office this year that they're on their own? Your guess is as good as ours.

The only thing we feel confident about is that Trump is securing his place as the worst foreign-policy president in American history. Which means George W. Bush is going to live to see himself escape that particular basement, and Lyndon Johnson also gets bumped up a notch on the ladder. (Z)