Michael Hudson: Why America Is at War with Iran

Yves here. Below Michael Hudson explains how long-standing the neocon plans to break up Iran have been (as going back to before they were called “neocons”) and why this project has been and still is seen as vital to preserving US dominance.

By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is The Destiny of Civilization. Originally published at The Democracy Collective

Opponents of the war with Iran say that the war is not in American interests, seeing that does not pose any visible threat to the United States. This appeal to reason misses the neocon 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 to most people, so much in violation of the basic principles of international law, the United Nations and the U.S. Constitution, 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 international institutions to reinforce U.S. unipolar power.

Around 1974 or 1975 there was much talk of creation a New International Economic Order (NIEO). I was working at the Hudson Institution with Herman Kahn on international finance and trade, and 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 northeast border with Pakistan. The Kurds, Tajiks and the Turkic Azerbaijanis are 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, by 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 and Syria, Lebanon, Libya, Somalia and Sudan, culminating in Iran.

Fast Forward to Today

Most of the discussion of the geopolitical dynamics of how the international economy is changing is understandably focusing on the attempt by the BRICS and other countries to escape from U.S. control by de-dollarizing their trade and investment. But the most active dynamic reshaping the international economy has been Donald Trump’s whirlwind presidency since January has to lock other countries into a U.S.-centered economy by agreeing not to focus their trade and investment on China, Russia and other states seeking their own autonomy from U.S. control. That is what the war in Iran is all about.

Trump expected that countries would respond to his threat to create tariff chaos in hope of regaining the U.S. market by reaching an agreement 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. This fight explains the U.S. objective in its current fight with Iran, as well as with Russia and China – and Cuba, Venezuela other countries seeking to restructure their economic policies to recover their independence.

From the view of U.S. strategists, the emergence of China’s industrial socialism poses an existential danger to U.S. unipolar control in providing a model that other countries might seek to join to recover the national sovereignty that has been steadily eroded in recent decades.

The Biden Administration and a host of U.S. Cold Warriors frame the issue as being between democracy (defined as countries supporting U.S. policy as client regimes) and autocracy (seeking national self-reliance from foreign trade and financial dependency. This way of framing the international economy views China as an existential threat to U.S. unipolar domination, and that attitude explains the US/NATO attack on Russia in the Ukraine war of attrition, and most recently the US/Israeli war against Iran threatening to engulf the whole world in U.S.-backed war

The motivation has nothing to do with Iran’s attempt to protect its national sovereignty by developing an atom bomb. The basic problem is that the United States has taken the initiative in trying to pre-empt Iran and other countries from breaking away from dollar hegemony.

Here’s how the neocons spell out the U.S. national interest in overthrowing the Iranian government and introducing a regime change – not necessarily a secular democratic regime change, but perhaps an extension of the ISIS-Al Qaida Syrian Wahabi terrorists.

With Iran and its component parts turned into a set of client oligarchies, U.S. diplomacy can control Near 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 and also as domestic U.S. producers of oil and gas. Control of Near Eastern oil also means control of the vast holdings of U.S. Treasury securities and private-sector investments by Saudi Arabia and other OPEC countries.

The United States holds these OPEC and other foreign investments as hostages, which can be expropriated much as the United States grabbed $300 billion of Russia’s monetary savings in the West in 2022. This explains why these countries fear acting in support of the Palestinians or Iranians in today’s conflict.

But Iran is not only the key to control of the Near East and its oil and dollar holdings. Iran is the key link for China’s Belt and Road program for a New Silk Road of railway transport to the West. If the United States can block it, this interrupts the long transportation corridor that China hopes to construct.

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

To the Neocons, this makes Iran a central pivot on which U.S. national interest is based – if you define that national interest as creating a coercive empire of client states.

I think that Trump’s warning to Tehran citizens to evacuate their city is just trying to stir up domestic panic as a prelude to the U.S. attempt to mobilize ethnic opposition and try to break up Iran into component parts. That is similar to the U.S. hopes to succeed in breaking up Russia and China into regional ethnicities. That is the U.S. strategic hope for a new international order remaining under its command.

b>Trump’s Republican Budget Plan and Its Vast Increase in Military Spending

The irony, of course, is that U.S. attempts to hold onto its fading economic empire continue to be self-defeating. The objective is to control other nations by threatening economic chaos. But it is this U.S. threat of chaos that is driving them to seek alternatives elsewhere. But an objective is not a strategy. And the plan to use Netanyahu as America’s counterpart to Ukraine’s Zelensky, demanding U.S. intervention with his willingness to fight to the last Israeli, much as US/NATO are fighting to the last Ukrainian, is a tactic is quite obviously at the expense of strategy. It is a warning to the entire world to find an escape hatch. Along with the U.S. trade and financial sanctions intended to keep other countries dependent on U.S. markets and a dollarized financial system, the attempt to impose a military empire from central Europe to the Middle East is politically self-destructive. It is making the coming split between the US unipolar world order and the Global Majority irreversible on moral grounds as well as simple self-interest.

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 boondoggle here. So far, only the oldest and least effective missiles have been used. The aim is to deplete Israel’s anti-missile defenses so that in a few days or even a week it will be unable to block a serious Iranian attack. This already was demonstrated a few months ago, just as Iran showed how easily it could bomb U.S. military bases.

The ostensible US military budget actually is much larger than is reported in the bill. Congress funds it in two ways: The obvious way is by direct arms purchases paid for by Congress directly. Less acknowledged is MIC spending routed via U.S. foreign military aid to its allies – Ukraine, Israel, South Korea, Europe and Asian countries to buy U.S. arms. This shows the extent to which the military burden is what normally accounts for the entire U.S. budget deficit and hence the rise in ostensible government debt (much of it self-financed by the Federal Reserve since 2008, to be sure).

America’s 2001 Authorization for Use of Military Force (AUMF) is not applicable to this situation, unless the government is willing to spell out what the Iranian “threat” is really all about: preventing any other country from acting independently of U.S. self-proclaimed interests. And under Article 51 of the UN Charte,r a member state may not make an attack on another country unless attacked by that country or preventing an imminent attack by that country. Even then, the United States would have to receive Security Council authorization. This obviously would be blocked. If the United States proceeds without such authorization, Trump and his advisors will be as guilty as Netanyahu of perpetrating a war crime.

The problem, of course, is that the United Nations is now seen to have become toothless and irrelevant as a world organization able to implement international law. Breaking free of the U.S. unipolar order requires a full spectrum of alternative international organizations independent of the United States, NATO and other client allies.