USrael - Iran: More Damage Control; Big Picture Per Michael Hudson

As anticipated, slowly but surely, we’re learning more about the damage done by Trump’s war on Iran. This part of the post will be relatively brief. Thomas Keith has an interesting post that cites an Israeli source regarding damage to a key part of the offensive on Iran—advanced battle drones. These are not the disposable suicide drones:

]Thomas Keith @iwasnevrhere_

Dozens of Israeli drones, worth hundreds of millions, vanished into Iranian airspace. A senior Israeli official told Yedioth Ahronoth [largest circulation Israeli newspaper] they simply “disappeared.”

Now, Israel’s own finance minister, Bezalel Smotrich has frozen military procurement. Ynet reports a total freeze on new purchases, including rocket launchers and replacement stockpiles. Citing a rift with the army and accusations of “wasting mobilisation days.” The $16.2 billion emergency request is blocked, war debts are piling, and the state can’t pay for the myths it’s losing.

Israel waged an air war on Iran, lost its drones, failed to score decisive damage, and triggered a $12 billion crisis. All while Brigadier General Mohammad-Reza Naqdi, IRGC deputy commander, said only “less than five percent” of Iran’s defensive capacity was activated against Israel, clarifying this meant engagement, not expenditure.

Drones gone, stocks drained, army exposed, and now even the finance ministry is pulling the plug.

1:50 PM · Jun 30, 2025

I assume the freeze on new purchases is pending an assessment of what went wrong.

Another area of serious damage was in the human sabotage field—many of the assassinations and hits on soft targets were accomplished with Mossad/CIA agents. It’s doubtful that next time around that component of war on Iran will be anywhere near as effective—that type of operation takes many years to build up to that point. Scott Ritter speaking to Judge Nap today:

People need to know--and hopefully they've learned now--that if you get recruited by Mossad or CIA to operate inside Iran you are a disposable asset. You will be arrested and you will be hung and nobody's going to come and rescue you.

Ritter also stressed the damage Trump has done to the American brand:

It all depends on what Trump has signed off on. I personally believe that Trump has signed off on regime change in Iran as his primary objective, and everything else is just a subterfuge. The Iranians should treat it as such. There will be no diplomacy with the United States. ... You can't believe anything. Trump has already been exposed as a liar. The American people have to understand. Quit high-fiving yourself saying, "Hey, that's cool! Trump lured him!" That's the American president of the United States now being exposed globally as a liar--straight up liar. Can't trust them. Diplomacy in America means nothing. It's a subterfuge. Nobody can trust anything. Sign a treaty with America--doesn't matter. We won't abide by it. So stop high-fiving yourselves and understand: this has done critical damage to the reputation of the United States, but the bottom line is: I believe that Donald Trump is committed to a policy of regime change. He would like to have the nuclear program eliminated using regime change and the things that can happen there as opposed to direct military force. But he has boxed himself into a corner here because what happens when it emerges that we know that Esfahan is intact and Iran's not giving it up?

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In this second part, we give a 'h/t to commenter dissonant1. I’ve quoted Michael Hudson quite a few times in the past for various purposes. This article is one of his clearest and most easily digested. It presents, even in my truncated version, a very clear picture of what’s driving US policy—no matter what Trump and others may say for public consumption. Expect the dynamics of this strategic thinking—including Iran as a Southern Front against Eurasian integration—to continue to play out, absent some earth shaking event that brings Americans to their senses. That event could be financial in nature, triggered by the failures of Trump’s economic policies. Use this presentation as a filter for understanding news and public events.

Michael Hudson: War on Iran is fight for US unipolar control of world

Economist Michael Hudson explains how the war on Iran seeks to stop countries from breaking away from U.S. unipolar control and dollar hegemony, and to disrupt Eurasian integration with China and Russia.

By Michael Hudson

Published 2025-06-22

Opponents of the war with Iran ...

... miss[] the neoconservative logic that has guided U.S. foreign policy for more than a half century, and which is now threatening to engulf the Middle East in the most violent war since Korea.

That logic is so aggressive, so repugnant ..., that there is an understandable shyness in the authors of this strategy to spell out what is at stake.

What is at stake is the U.S. attempt to control the Middle East and its oil as a buttress of U.S. economic power, and to prevent other countries from moving to create their own autonomy from the U.S.-centered neoliberal order administered by the IMF, World Bank, and other institutions to reinforce U.S. unipolar power.

...

I was working at the Hudson Institute with Herman Kahn, and in 1974 or 1975, he brought me to sit in on a military strategy discussion of plans being made already at that time to possibly overthrow Iran and break it up into ethnic parts. Herman found the weakest spot to be Baluchistan, on Iran’s border with Pakistan. The Kurds, Tajiks, and Turkic Azeris were others whose ethnicities were to be played off against each other, giving U.S. diplomacy a key potential client dictatorship to reshape both Iranian and Pakistani political orientation if need be.

Three decades later, in 2003, General Wesley Clark pointed to Iran as being the capstone of seven countries that the United States needed to control in order to dominate the Middle East, starting with Iraq, Syria, Lebanon, Libya, Somalia, and Sudan, culminating in Iran.

Most of today’s discussion of the geopolitical dynamics of how the international economy is changing is understandably (and rightly) focusing on the attempt by BRICS and other countries to escape from U.S. control by de-dollarizing their trade and investment.

But the most active dynamic presently reshaping the international economy has been the attempts of Donald Trump’s whirlwind presidency since January to lock other countries into a U.S.-centered economy, by agreeing not to focus their trade and investment on China and other states seeking autonomy from U.S. control. (Trade with Russia is already heavily sanctioned.)

..., the war in Iran likewise has as an aim blocking trade with China and Russia and countering moves away from the U.S.-centered neoliberal order.

Trump, ..., expected that countries would respond to his threat to create tariff chaos by reaching an agreement with America not to trade with China, and indeed to accept U.S. trade and financial sanctions against it, Russia, Iran, and other countries deemed to be a threat to the unipolar U.S. global order.

Maintaining that order is the U.S. objective in its current fight with Iran, as well as its fights with Russia and China – and Cuba, Venezuela, and other countries seeking to restructure their economic policies to recover their independence.

From the view of U.S. strategists, the rise of China poses an existential danger to U.S. unipolar control, both as a result of China’s industrial and trade dominance outstripping the U.S. economy and threatening its markets and the dollarized global financial system, ...

U.S. administrations and a host of U.S. cold warriors have framed the issue as being between “democracy” (defined as countries supporting U.S. policy as client regimes and oligarchies) and “autocracy” (countries seeking national self-reliance and protection from foreign trade and financial dependency).

This framing of the international economy views not only China but any other country seeking national autonomy as an existential threat to U.S. unipolar domination. That attitude explains the U.S./NATO attack on Russia that has resulted in the Ukraine war of attrition, and most recently the U.S./Israeli war against Iran that is threatening to engulf the whole world in U.S.-backed war.

... The basic problem is that the United States has taken the initiative in trying to preempt Iran and other countries from breaking away from dollar hegemony and U.S. unipolar control.

Here’s how the neocons spell out the U.S. national interest in overthrowing the Iranian government and bringing about a regime change – not necessarily a secular democratic regime change, but perhaps an extension of the ISIS/Al-Qaida Wahhabi terrorists who have taken over Syria.

With Iran broken up and its component parts turned into a set of client oligarchies, U.S. diplomacy can control all Middle Eastern oil. And control of oil has been a cornerstone of U.S. international economic power for a century, thanks to U.S. oil companies operating internationally (not only as domestic U.S. producers of oil and gas) and remitting economic rents extracted from overseas to make a major contribution to the U.S. balance of payments.

Control of Middle Eastern oil also enables the dollar diplomacy that has seen Saudi Arabia and other OPEC countries invest their oil revenues into the U.S. economy by accumulating vast holdings of U.S. Treasury securities and private-sector investments.

The United States holds OPEC countries hostage through these investments in the U.S. economy (and in other Western economies), which can be expropriated much as the United States grabbed $300 billion of Russia’s monetary savings in the West in 2022. This largely explains why these countries are afraid to act in support of the Palestinians or Iranians in today’s conflict.

But Iran is not only the capstone to full control of the Near East and its oil and dollar holdings. Iran is a key link for China’s Belt and Road Initiative for a New Silk Road of railway transport to the West.

...

Iran also is a key to blocking Russian trade and development via the Caspian Sea and access to the south, bypassing the Suez Canal. And under U.S. control, an Iranian client regime could threaten Russia from its southern flank.

To the neocons, all this makes Iran a central pivot on which the U.S. national interest is based – if you define that national interest as creating a coercive empire of client states observing dollar hegemony by adhering to the dollarized international financial system.

...

That is the U.S. strategic hope for a new international order that remains under its command.

...

The objective is to control other nations by threatening economic chaos. But it is this U.S. threat of chaos that is driving other nations to seek alternatives elsewhere. And an objective is not a strategy.

...

It is a warning to the entire world to find an escape hatch.

Like the U.S. trade and financial sanctions intended to keep other countries dependent on U.S. markets and a dollarized international financial system, the attempt to impose a military empire from Central Europe to the Middle East is politically self-destructive.

...

The ease with which Iranian missiles have been able to penetrate Israel’s much-vaunted Iron Dome defense shows the folly of Trump’s pressure for an enormous trillion-dollar subsidy to the U.S. military-industrial complex for a similar Golden Dome boondoggle here in the United States.

...

By intervening on Israel’s side by supporting its genocide, the United States has turned most of the UN’s Global Majority against it.

Washington’s ill-thought backing of the reckless Netanyahu has catalyzed the drive by other countries to speed their way out of the U.S. diplomatic, economic, and military orbit.

So America’s Oil War against Iran can now be added to the long list of wars that the United States has lost since the Korean and Vietnam wars, Afghanistan, Iraq, and the rest of its adventures leading up to its imminent loss in Ukraine. Its victories have been against Grenada and German industry – its own imperial “backyard,” so to speak.

…