Oil Crisis Escalates: When Does Iran War End? | Richard Wolff

Richard D. Wolff · Democracy at Work

The war gained nothing: Hormuz merely returned to its pre-war state, so declaring victory is spin.

Wolff notes the Strait of Hormuz was open before the US and Israel attacked Iran. After spending billions of dollars and losing many lives, the war's main result is reproducing the pre-war situation, which he says is not a victory but a spin on bad news. He adds that officials have declared the strait open at least eight times, and each time it turned out to be an exaggeration, which he calls lying in the way wartime propaganda works.

“It is therefore very strange to declare victory when after spending ... billions of dollars, the loss of many, many lives, your great achievement is to reproduce what was there before you ever made the attack. This is not victory.”at 6:31

Richard D. Wolff · Democracy at Work

The nuclear rationale is delusional: US strikes cannot stop Iran getting weapons from Russia and China.

Wolff argues Iran was under constant International Atomic Energy Agency inspections and was not building weapons, so killing its leader and scientists was not justified. He says Russia, which shares a Caspian border with Iran, can deliver any weapon at any time, and China is the largest manufacturer of missiles and drones. Russia and China are on record as Iran's allies, so US military action cannot decide whether Iran gets a nuclear weapon.

“The notion that United States military maneuvers are in a position to decide whether or not Iran gets a nuclear weapon is delusional.”at 12:33

Richard D. Wolff · Democracy at Work

Hormuz won't return to normal until Iran gets its demands, including US withdrawal from the Gulf.

Wolff cites prediction-market pricing and his reading of the news as evidence the strait is not back to normal, and he rejects the White House claim that oil is at pre-war levels. He argues Iran says it controls the strait and will decide when it opens, opening it once the US leaves the Gulf area and its bases are abandoned. Iran also ties the level of transit fees to whether the US releases frozen Iranian assets, so low fees depend on US pressure. He expects normal traffic only after Iran's conditions are met.

“I don't think we're gonna return to normal until the Iranians get what they demand.”at 15:19

Richard D. Wolff · Democracy at Work

The US cannot control Iran, so the war won't stop until Washington abandons that goal.

Wolff reads the same news as the host and concludes the war will continue until the US gives up trying to control Iran. He says he does not think this is possible. He compares Iran, a country of 92 million people with a larger, richer and more industrialised base and a stronger alliance with Russia and China, to Vietnam and Afghanistan. He concludes the twelve-day war last year and the forty days of fighting this year did not work, and US firepower will not change the result.

“this war will not stop until The United States gives up what it has been trying to do, which is to control Iran. I don't think that's possible.”at 15:33

Richard D. Wolff · Democracy at Work

If the US leaves the Gulf, regional states must accommodate Iran as the new regional power.

Wolff argues that US withdrawal would force the Gulf states to come to terms with Iran as a new power in the area, which he says they are already doing. He sees Israel as the greatest danger because it has been attacking its neighbours, a game he says will end once the US, which pays for it, steps back. He concludes that leaving is the best option for the US.

“If The United States leaves, it forces the governments of the Gulf States ... They're gonna have to come to terms with a new power in that area, which is Iran.”at 21:39

Richard D. Wolff · Democracy at Work

Republicans are in trouble; Trump's best chance is to declare the war over before the midterms.

Wolff says the Republican Party is in trouble because millions of Americans who once supported the party no longer do, and a majority did not support this war from the start. He argues Trump's best option is to declare the war over, claim credit for bringing US troops home, and try to turn the situation around before November. He says the war has cost Trump much of his support, and the best move is to cut his losses.

“I think the best chance he has would be to declare the war is over.”at 29:36

Richard D. Wolff · Democracy at Work

The mass of Americans no longer want capitalism, and the trend toward socialism will only grow.

Wolff cites polling in which 18-to-34-year-olds view socialism more positively than capitalism, 57% to 43%. He says the trend runs deeper and longer than the recent CPI correlation the host raised, and he expects it to worsen as the younger cohort ages in. He qualifies it: he reads the numbers as lack of knowledge about socialism rather than enthusiasm, since his students often ask what it is and the public discourse is dismissive.

“The mass of Americans don't want capitalism anymore.”at 34:48

Richard D. Wolff · Democracy at Work

US munitions are being depleted by Ukraine, Israel and Iran support, threatening American security.

Wolff says the US has been using up its ammunition across Ukraine, Israel and its own operations in the Iran war. He says very little is left and that this will soon threaten US security. He presents it as one reason the US cannot sustain a long military campaign against Iran, alongside Iran's ability to get weapons from Russia and China.

“That's why we'd have trouble with our ammunition supply. We're using it up between what we give to Ukraine and what we give here and what we give Israel anyway.”at 16:36

Richard D. Wolff · Democracy at Work

Tanker insurance costs are crippling shipping profitability, so Hormuz traffic won't normalize even without attacks.

Wolff, as an economist, argues each tanker attack reprices risk: every tanker through the strait must be insured, and the insurance is extremely costly when a ship could blow up and spill or burn oil. Some shippers cannot afford the cover. He says the insurance cost alone cripples profitability even for ships that expect no hit, so normal traffic will not return. He rejects the White House claim that oil is back to pre-war levels on this basis.

“Every time you see a tanker hit, you are watching even though you don't know it, insurance recalibrations. Every tanker that goes through there has to be insured.”at 24:08

Richard D. Wolff · Democracy at Work

US inflation isn't going away, and the biggest oil-driven impact has not yet arrived.

Wolff argues the inflation from the war is not yet fully visible. He says the largest impact is about to hit once there is no longer a way to hold back rising oil prices. He ties this to Iran's ability to restrict the strait, the continuing war, and the rise in diesel that feeds into food and other goods. He says the strongest impact is still ahead.

“The inflation isn't going away, and we haven't begun to see it because the biggest impact on inflation is about to come when we have no more way of holding back the rising price of oil.”at 25:23

Richard D. Wolff · Democracy at Work

Diesel prices have more than doubled in a year, and that is feeding into food costs.

Wolff says that as oil rises, diesel rises with it, and that diesel prices have more than doubled over the past year. He argues diesel is what gets food to the table and runs the tractors that farmers use, so the fuel cost hits food supply. He also notes that refiners lobbied against a diesel export ban that could have lowered domestic prices, saying they would cut output and push prices back up.

“the price of oil goes up. That means the price of diesel goes up. I wanna tell people the price of diesel has doubled over the last year, more than doubled. Diesel is what brings the food to our table.”at 25:51

Richard D. Wolff · Democracy at Work

Farmers are squeezed by diesel, nitrogen and potash costs plus labor losses from deportations.

Wolff argues US agriculture faces pressure from several sides. Nitrogen fertiliser rises because it is made from oil, and potash rises because it comes from Canada and now faces tariffs. Diesel costs are also up. The government has deported about 1.5 million people, many of them field workers, so farmers cannot get crops in and cannot find Americans to hire at higher pay. He calls this a two-front war on American agriculture.

“Mister Trump has waged a two front war against American agriculture. He has deported a million and a half people, a huge number of whom work in the fields of The United States.”at 26:10

Richard D. Wolff · Democracy at Work

US manufacturing won't return: firms moved production abroad for profit, and China now holds the capacity.

Wolff says about ten presidents promised to bring manufacturing back and none did, and Trump failed too. He blames profitability: American companies moved production to China, India and Brazil because that is where it paid, and that is how they always work. He says the problem predates Trump and will persist whatever the November result. On the World War II industrial comparison, he argues that ship has sailed because China now holds the manufacturing base that left Europe and the US.

“10 presidents before him promised to bring manufacturing back to America. Trump promised it too. None of them did it.”at 31:18

Richard D. Wolff · Democracy at Work

America's post-war economic, political and military dominance is over, like every empire's.

Wolff contrasts the 1950s and 1960s, when the US was the dominant economic, political and military power and the currency everyone wanted to hold, with today. He argues that this position is gone, that the people who grew up in that era are seeing it end, and that continuing to act as if it has not ended will lead to more failed wars. He ties it to the Iran conflict, where he says Iran can obtain weapons from Russia and China regardless of US action.

“We were the dominant economic and political and military power. We were the currency everybody wanted to have. ... but it's gone. Like every empire, it's over now.”at 34:02

Richard D. Wolff · Democracy at Work

Deporting immigrants won't fix America's economic problems; scapegoating them makes things worse, as Brexit showed.

Wolff argues that when capitalist economies struggle and ruling classes squeeze the working mass, elites redirect working-class anger toward a minority group. He says that in the US the chosen group is immigrants, and that the deportations have not solved the underlying problems: 'It's not getting better as we deport them. It's getting worse.' He supports this with the analogy of Britain blaming Europe for its problems in 2016 with Brexit, which he says did not solve them either. He also notes the same pattern in Europe and historically, with anti-immigrant movements rising in Germany and France during economic strain.

“You made out that they were the bad guy, and we're deporting them. And guess what? It turns out that that's not gonna solve our problems. It's not getting better as we deport them. It's getting worse.”at 46:08

Richard D. Wolff · Democracy at Work

Billionaires are spending heavily in California to block laws that would limit them or ease poor people's voting.

Wolff describes the political struggle over the economic shift he expects as a current example. He says there is an enormous fight in California right now because billionaires are spending money to stop laws that would restrict or limit them or make it easier for poor people to vote. He frames this as an effort to hold back a broader shift toward government playing a larger role in improving average people's lives, which he argues could blow the situation up. The evidence is a single example and no figures on the spending are given.

“in California right now, there's an enormous struggle because billionaires are spending money to prevent laws from being passed that would restrict or limit them or make poor people have an easier time voting.”at 49:02