Today we brace for another sharp spike in fuel prices. It will not be the last.
Global oil prices are on the uptrend mainly because the situation at the Persian Gulf swings between tense and tenser. That ridiculous memorandum of understanding supposedly forged between the Trump administration and the Iranian leadership formally expired. It was, at any rate, ineffectual for reestablishing peace in the Gulf region.
Even when this framework for negotiations was supposedly in effect, the US and Israel stepped up its bombing of Iran. Tehran responded to these attacks by sending its most advanced missiles to destroy what was left of about a dozen US military facilities in the region. By most accounts, US radar cover for the region was wiped out, making it easier for Iranian missiles to penetrate Israeli airspace and wreak havoc on her cities.
Military analysts believe the US military has severely depleted its munitions – especially in terms of the costly air defense systems needed to defend strategic airspace. US casualties from attacks on American bases are likely higher than Washington wants to admit. The destruction of an important logistics hub for the US Navy produced difficulties for American warships operating in the Persian Gulf and Arabian Sea. Stories about an aircraft carrier crew being fed starvation rations were serious enough to merit US congressional inquiries.
Running low on munitions, Donald Trump announced the start of what he described as crippling economic warfare against Iran. This economic war is supposed to commence today, our time, with the White House detailing its plan to use economic pressure to bring the regime in Tehran to its knees.
Considering all the lies Trump has told through the course of this war, not many are expectant Washington has uncovered a new strategy to defeat Iran – or, at least, to cover up America’s crushing military defeat in the hands of a regional power. The US has been waging an economic war on Iran for nearly half a century, with the unabashed goal of bringing the Tehran regime to its knees. Through those five decades, Iran built a self-reliant economy capable of supporting a respectable military force.
The US regime of sanctions against Iran is as brutal as that imposed against Cuba for a much longer period. Cuba continues to resist the US war of economic strangulation with the support of countries friendly to it.
When Trump announced he was launching a “D-Day” of even more rigorous sanctions against Iran, Beijing was quick to announce that it will not be supporting efforts to completely isolate Iran. Russia delivered advance air defense equipment to Tehran. Other than the UAE, most other Gulf countries are trying to cut a separate peace with Tehran, convinced that the US has lost capacity to defend them.
Even as Washington was preparing to announce the details of its “D-Day,” talks between the US and Canada collapsed spectacularly over the weekend. Trump was trying to bully Canada, curtailing its sovereign power to forge economic deals with other countries and even interfering in its domestic language policy.
Trump announced the deal to be imminent. Canada simply walked out and terminated all negotiations. Despite the potential economic pain, the Canadian government announced it will retaliate for all additional tariffs Trump might want to impose.
This is not a good sign that Trump will win the enthusiastic support of America’s allies in whatever economic strategy he might contrive against Iran. Any US attempt to stop oil deliveries from Iran to China will likely provoke a high-stakes confrontation with the Asian superpower. The Europeans have not made any statement of support for Trump’s “D-Day.” Japan and Korea are silent as stone.
Even as Trump gears up for his “D-Day,” it was announced that the US just crossed an important psychological threshold: America’s outstanding debt hit $40 trillion. This will ripple through the markets this week.
Trump tries his best to minimize the significance of the debt by saying the US will simply outgrow it. Beyond a certain threshold, no country really outgrows its indebtedness. High debt levels may not cause an economy to implode and disappear like a dying star, but it will exhibit in the deepening misery of its citizens.
Filipinos should know this. Our indebtedness is such that we could no longer reasonably hope to outgrow it. Not in our lifetime or in our children’s lifetime. The debt overhang will simply sap our economic strength and cause us to fall behind everybody else. See what has happened to debt-ridden Japan.
Borrowing is more than an addiction. Our whole political order is designed to keep us trapped in debt. Endless dole-outs is the only way our traitorous political elite can buy any legitimacy.
Tehran announced a full-scale war. Any of its neighbors found cooperating with the US will be punished, not the least by being denied access through Hormuz.
It is hard to see why any other country might want to cooperate with Trump’s “D-Day” plan. The US economy is now in a trade war with Canada. Countries are dumping American bonds. Many fear the American stock market is bloated by tech stocks that could lose value in an instant. Trump has antagonized every other country with his whimsical tariffs and petulant diplomacy.
Trump’s so-called “economic war” will be futile in a world with nothing to gain from it.