Doug Casey on the Potential for War With Iran—and the Financial Shockwaves That Could Follow

International Man: Tensions between the US and Iran over Tehran’s nuclear ambitions are reaching a boiling point.

How likely is it that this long-simmering standoff erupts into a full-scale war?

Doug Casey: Iran has been an adversary of the US ever since the overthrow of the Shah in 1979 and the capture of the US Embassy.

It’s unlikely to get better anytime soon, not least because the country is ruled by mullahs, Shia clergy. Iran is a theocracy. And that leads us to another problem. So is Israel.

The Quran and the Hadiths constantly assert that non-believers, in general, but Jews, in particular, are the enemy. Those beliefs are part of the fabric of Mohammedanism, and that’s not going to change.

Meanwhile, the US often accuses Iran of being a terrorist state, which is untrue. Iran doesn’t send teams out around the world to create terror. Their problem is with Israel. Even so, Iran never attacked Israel directly before last year, when it launched a missile barrage.

The main cat’s paw of Iran against Israel is the Houthis, who control Northern Yemen. The Iranians and the Houthis are both Shia Muslims. Almost all Islamic terrorism comes from the Sunnis, not the Shias.

As for the Houthis, they’re a state within a state. Yemen is just an agglomeration of tribes. It’s about the poorest and most dangerous place in the world. There’s no point in parsing local politics in a place like that; it’s enough to say that the Houthis support the Gazans and hate the Israelis. The Iranians supply them with missiles to launch at Israel, and ships headed to or from Israel on the Red Sea.

There’s no reason why the US should be involved in an ancient religious dispute on the other side of the world. But it is, launching expensive air strikes to kill local peasants and blow up their mud huts. It’s nothing unusual there. US involvement only makes things worse. The question is: Will the US start a war with Iran?

It’s said (we only know what we’re told) that the US has transferred six B-2 bombers, among other military assets, to the island of Diego Garcia in the Indian Ocean. It’s a convenient launch point for an attack on Iran.

The US is already actively bombing the primitive Houthis, which amounts to state terrorism. Fun fact: The Houthis have never done anything against the US, nor are they capable of it. The US has gotten into the habit of promiscuously attacking any country it wants, especially small ones that can’t strike back. It’s quite shameful.

International Man: Even if Washington prefers to avoid a military confrontation, could Israeli actions effectively force the US into a war with Iran?

Doug Casey: The Times of Israel ran an article last week spotlighting 13 Jews, plus Ivanka and Jared Kushner, in Trump’s inner circle. In addition, there are 10 senators and about two dozen congressmen who are Jewish. A number of them are dual nationals of Israel and the US. It’s inappropriate to be a US Government official and simultaneously a citizen of another country. No doubt they try to influence Trump.

I realize that you’re not supposed to mention things of this nature, especially about Jews or Muslims. But most Americans are unaware that for decades, the US has been giving the Israelis and the Egyptians—each—about $4 billion per year.

It’s a mystery why that money goes to the Israelis. But for the Egyptians it’s a bribe to keep them friendly with the Israelis. Of course that’s only part of the $74 billion dispensed to foreign governments last year. I suspect that the real number is much higher. Who knows how much more goes out in loans, aid from NGOs, and all manner of disguised corruption? The proper amount of aid, FWIW, is zero.

The relationship between Israel and the US is like that between a vicious dog and his bad-tempered master. I’m not sure who’s the dog and who’s the master. But it’s an inappropriate relationship.

International Man: What would a full-scale war with Iran look like?

Doug Casey: Well, the first and most obvious consequence would be the Iranians closing the 30-mile-wide Strait of Hormuz at the southern end of the Persian Gulf. Most of the oil pumped from the Middle East has to go through it, too. It’s really an Iranian lake. The same is true about the exit of the Red Sea to the Indian Ocean, which Yemen controls; the Suez Canal could become useless.

If these two waterways are closed—which they absolutely would be—it would be a catastrophe for world trade, oil in particular. Oddly, it wouldn’t have a huge direct effect on the US, which is now a net oil exporter and gets almost no oil or any other traffic through the Yemeni-controlled Red Sea or the Iran-controlled Strait of Hormuz. A full-scale war with Iran would be chaos for the world, plus a bunch of sunken US Navy ships.

International Man: In what ways would a war with Iran resemble—or differ from—the wars in Iraq and Afghanistan?

Doug Casey: Unlike Iraq and Afghanistan, Iran is big game. It would be practically impossible to invade Iran, because of its huge size, mountainous terrain, and population of 80 million.

The last thing the US needs is a sunk aircraft carrier. Even now, bombing the primitive Yemenis, it’s said the US has lost 10 Predator and Reaper drones, at $30 million a pop. Since war is essentially a matter of economics, and its adventure with the Houthis has already cost well into nine figures, I’d say the US has already lost.

On the bright side, as aggressive and threatening as the Trump regime is, at least they’re talking to the Iranians. Unlike the Biden regime, which spoke to neither Iran nor Russia. The Trumpers bluster, but at least they’re willing to negotiate. The Bidenistas fomented and financed the war between the Ukraine and Russia but remained totally incommunicado with a nuclear power. That was criminally stupid.

At least he’s talking with them, although Trump threatens to do things “like they’ve never seen before,” to use one of his favorite phrases. But he’s apparently insisting that they close their nuclear reactors, and essentially demilitarize. That’s a non-starter.

International Man: How might a war with Iran impact the Trump administration’s domestic priorities and broader foreign policy goals?

Doug Casey: One thing to remember is that China, Russia, and Iran have close trade and military relations with each other. So, threatening Iran can only worsen US relations with both China and Russia. And they’re not good right now.

You can expect the Chinese and the Russians to aid Iran with technology and materiel. Most likely they’ll do it covertly, the way the US helped the Ukraine. So if the US starts something with Iran, it’s not going to be a cakewalk like invading Panama or Grenada or bombing the Houthis.

Trump may understand something about the art of the deal, but he knows nothing about economics or history. It would be good if someone drew Thomas Jefferson’s words to his attention: The United States should be a friend to all but an ally to none. Or what John Adams said: We should never go abroad hunting for dragons to slay.

International Man: What do you see as the major geopolitical and financial consequences if the US becomes entangled in a war with Iran?

Doug Casey: It’s hard to tell how much money the US really spends on its military. Figuring it out is like rooting through a landfill.

I hate to call it the “defense” budget because that’s a misnomer, an extreme euphemism. It amounts to a welfare program for a military-industrial complex making obsolescent vanity toys. It’s generally reported at about $800 billion, but Trump says he wants to raise it to $1 trillion. That’s an incomprehensible thing to say when the country’s already over the edge of bankruptcy.

Remember what Randolph Bourne said: “War is the health of the State.” If you support freedom, you’ve got to be naturally opposed to war, especially a completely unnecessary one with Iran. There’s nothing the US can gain. Only Israel could conceivably benefit from that war.

And probably not even Israel. If you hit a hornet’s nest with a baseball bat, it will hurt the hornet’s nest, but the hornets will swarm anybody nearby. An it’s not like they’ll think the Israelis are innocent bystanders…

While I’m rolling out famous quotes, Field Marshall Helmuth von Molkte said that no battle plan survives first contact with an enemy. Trump wouldn’t be familiar with that quote. But who doesn’t know Mike Tyson’s take: “Everybody’s got a plan until they get punched in the mouth.”

It seems to me that, although the US is obviously following in the footsteps of Rome as it declined, Athens might be a better comparison. They fomented the Peloponnesian War against Sparta, which ended up bankrupting and destroying Athens.

The same thing is happening before our eyes with the US. The wars and rumors of wars emanating out of Washington can’t end well.

We can’t do anything about the big picture. But you should stay long: gold, oil, gas, and coal.

Editor’s Note: Unfortunately, there’s little any individual can practically do to change the course of these trends in motion.

The best you can and should do is to stay informed so that you can protect yourself in the best way possible, and even profit from the situation.

That’s precisely why bestselling author Doug Casey and his colleagues just released an urgent new PDF report that explains what could come next and what you can do about it.

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