President Trump’s announcement on Wednesday that he was launching an “Economic D-Day” on Iran has been met with a combination of bluster and panic in Tehran.
The IRGC is huffing and puffing as usual, claiming they will cut undersea cables and isolate the Arab Gulf states from the Internet, shutting down the banking system in the region.
One wag even suggested that brave Revolutionary Guards soldiers, whose claim to battlefield glory is to slaughter innocent children in the streets of Iranian cities, would invade Kuwait to seize U.S. bases there.
I know a few former specops guys who are licking their chops. Count me in!
On Friday, Iran’s lead negotiator, former IRGC Air Force Commander Mohammad Baqr Qalibaf, told an audience at the Iranian embassy in Baghdad that the regime would go down if it couldn’t get the economy back on its feet. “No matter how much military power we have, if people are hungry and we don’t have financial circulation, economic growth, and domestic production, we will not endure,” he said.
The economic desperation is hard to hide. Ordinary Iranians gave up meat months ago, and now they are also giving up poultry and eggs, which are up 130%. Inflation reached 66% for the month of July.
The semi-official Iran Labor News Agency (ILNA), calls it a “survival economy,” with people renting out their laptops and even selling their hair and personal belongings to make ends meet.
The U.S. naval blockade is working. No new Iranian oil is exiting the Strait of Hormuz to international markets, leading the regime to cut back production to just above domestic consumption.
As I have remarked before, Treasury Secretary Scott Bessent has turned out to be the Trump Administration’s secret weapon. He has unleashed Treasury’s vast but little-known intelligence networks to identify Iranian regime money-laundering networks and shut them down.
Last week, someone drained the cryptocurrency wallets the regime had been using to collect billions of dollars in tolls from ships transiting the Iranian route through the Strait of Hormuz.
On Thursday, Bessent identified an Iranian money-laundering network in Turkey that was bringing hundreds of millions of dollars in cash on international flights to Hezb’allah in Lebanon. He named the couriers and their controllers. I don’t think they will be flying internationally any time soon.
That’s how Scotty does it.
“We are going to squash the economy of this murderous regime,” he told CNBC on Thursday. Even when he talks tough, he talks softly, with his pinky in the air. Give that man a glass of rosé!
The IRGC loves to talk tough. And to brutalize unarmed Iranian civilians. But when you go after their money, they take notice.
So in late May, when the Steve Witkoff-Jared Kushner negotiations with the Iranians were going squirrely, Tulsi Gabbard — still Director of National Intelligence — called in a chit from Iraqi Kurdistan President Nichervan Barzani.
Hey Nichervan, she said. Can you get me Ahmad Vahidi on the line? Vahidi being, of course, the commander of the Revolutionary Guards, who was telling everyone how the IRGC would never negotiate with the United States.
Nichervan makes a call. Vahidi sends a gopher with an encrypted phone, and the two talk. So Ahmad, my friend, are you really serious when you say you will sabotage these negotiations being led by Qalibaf? And Vahidi says — get this – No. We are fully behind the negotiations with the Americans. We just can’t say it.
Well, that story came out this week, and it only added to the turmoil in Tehran. The commander of the IRGC had secret back-channel talks with the Director of National Intelligence in Washington?
Soon, the spotlight will shift to China for Trump’s state visit at the end of September.
Just for the record, I don’t believe the Iranians are going to succeed in blowing up the world economy in time to sabotage the Republicans in the midterms. (The Republicans often seem capable of sabotaging themselves, so let’s hope that doesn’t happen!)
I have heard the panics and the lefties argue non-stop that we have no influence over the Chinese, and that there’s nothing Trump can do to get the Chinese to cut off their military assistance to Iran.
I beg to differ. Trump doesn’t need to do much publicly. It’s all happening behind the scenes.
The head of the Iran-China Chamber of Commerce revealed recently that the U.S. blockade on the Strait of Hormuz will add $18 billion in shipping costs on containers coming from China to Iran, since they are now being brought overland by truck and rail.
And what about China’s tin pot refiners? They were the buyers of 80% of Iran’s sanctions-busting oil, at steep discounts. Now they are running on empty.
We don’t need China to cooperate with us on Iran. They just need to get out of the way so they don’t get hurt.
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The UAE just announced a total trade embargo on Iran. This, too, will hurt China, since many of its exports to Iran were disguised as re-exports from Dubai.
Trump doesn’t need to wield the big stick with China. He’s already stuck them with a thousand toothpicks.
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