The Times They Are A-Changin’; One Down, One To Go…? 

“Pushing the stone up the hill of failure” 

As we say farewell to PM Starmer, hopefully President Trump will follow. As the sun hopefully sets on his Iran blunder the true costs are becoming apparent. 

In terms of money and the economy, research shows the following. 

The Department of defense reported a $29 billion expenditure for active operations, equipment maintenance, and munitions replacement. This excludes the uncalculated costs of repairing Middle Eastern military installations, including Kuwait and Bahrain, following drone and missile counter-attacks. 

There are also indirect costs; the Iran War Cost Tracker estimates total direct expenditures over the first 108 days of conflict of $113.3bln. 

Turning to the macroeconomic impacts, economists and public finance experts at the Harvard Kennedy School estimate the true long-term financial consequences—including veteran care and military rebuilding— exceeding $1trn. 

Turning to consumer energy costs, analysis by the Brown University Costs of War Project shows the disruption of the Strait of Hormuz cost American households over $59.2bn in higher prices for gasoline and diesel. 

The 14-point MoU has been greeted with relief more than anything else, along with some pandering to Trump’s ego, to ensure that people didn’t see the exercise as a unnecessary and futile defeat. 

‘some pandering to Trump’s ego, to ensure that people didn’t see the exercise as a unnecessary and futile defeat’

The intent had been to eliminate Iran’s nuclear programme, destroying its ballistic missile programme and ending its support for regional military groups including Hezbollah and Hamas, coupled with unconditional surrender. 

Instead, Iran appears to have done rather well;  remaining in control of the Strait of Hormuz, keeping a robust missile program, and its proxy terror network. 

As Iran will likely be subject to ongoing IAEA inspection, the US will seemingly have to take Iran’s word not to build a bomb.  

Leaders of the G7 countries welcomed the deal, calling it a “historic opportunity to prevent Iran from acquiring any nuclear weapon”. Clearly missing the fact that Trump had bombed and destroyed Iran’s nuclear capability last year! 

They also seem too polite to point out that President Obama’s 2015 Joint Comprehensive Plan of Action also stopped Iran from creating nuclear weapons. Or, it did, until Trump exited the agreement in 2018. 

‘Trump has succeeded in reopening of the strait of Hormuz, but then it was his fault it was closed to start with’

Specifically, in Obama’s deal Iran agreed to limit its uranium enrichment to a level suitable for civil energy but far below weapons-grade, and cut its low-enriched uranium stockpile by 97%. To support this, the International Atomic Energy Agency was granted 24/7 access to monitor Iran’s entire nuclear supply chain. 

In return, Iran was granted sanctions relief with the lifting of the economic and oil-related sanctions imposed by the US, EU, restoring Iran’s access to the global financial trade network. 

In effect we are back where we once were. Trump has succeeded in reopening of the strait of Hormuz, but then it was his fault it was closed to start with. 

The Wall Street Journal summed up the deal as “a huge boost to Tehran’s oil industry, potentially restoring … more than $60 billion a year of revenue.”  

In summary; much ado about nothing at exorbitant cost. 

The war, along with Trump’s failed as tariffs, and ICE’s over-enthusiasm, has disillusioned even his Maga voters. 

The New York Times reported that a majority of white, non-college educated voters disapprove of Trump’s handling of the economy. During the 2018 midterms he held a +30-point advantage with working-class white voters, now this negative by between 14 to 30 points. 

‘Trump and his uber rich cronies cares more about self-enrichment than anything or anyone else’

I was always stunned that Hispanics voted for Trump, however his disastrous economic and  cruel anti-immigrant onslaught is correcting this. PRRI shows support down from 39% in September 2024 to 23%, the lowest in five years.  

In the same vein, the UnidosUS Bipartisan Poll of Hispanic Voters found 67% nationally disapprove of Trump’s performance, and 66% think he and Republicans are not doing enough on the economy.  

Behind the polling numbers is the inescapable economic reality of the cost-of-living. Americans are struggling to make ends meet, and are beginning to realise that Trump and his uber rich cronies cares more about self-enrichment than anything or anyone else. 

A report by the Bureau of Labor Statistics highlighted how energy prices “had wiped out a year and a half of wage gains for the average American worker”. At the same time, Elon Musk was celebrating becoming a trillionaire. This was summed up by the New York Times reporting:  “many Americans, in survey after survey, say they no longer believe the U.S. economy is working for them.” 

‘In addition to becoming a trillionaire, Musk slashed jobs and vital programs as DOGE chieftain’

In addition to becoming a trillionaire, Musk slashed jobs and vital programs as DOGE chieftain. 

We end by looking at renewable energy, a favourite subject of populists. 

Last week, the Interior Department announced it would pay the energy developer Invenergy $765 million NOT to develop three offshore wind farms, the third such payment by the Trump administration.  

To date, Trump has committed $2.5bln to killing renewable energy projects.  

This highlights how detached from reality this administration is. Besides wasting $2.5bln of taxpayers money, this is exactly the time when clean energy projects would benefits Americans suffering from soaring electricity prices thanks to data centres and Trump induced gasoline prices. 

With the exception of the US, Trump’s disastrous excursion to  Iran war has delivered a huge boost for renewable energy around the world, shifting the global economy away from fossil fuels and towards renewable energy. 

‘Iran war has delivered a huge boost for renewable energy around the world’

California, technically the world’s 4th largest economy, sources over 50% of its electricity from renewables. The reason it can do this, which may surprise many in denial over renewables is that, whilst the sun only shines in the daytime, batteries store that energy for use at night! 

Elsewhere, North Dakota gets more than a third of its electricity from wind power, in South Dakota wind provides 57% percent of their electricity.  

Further afield, Renewables account for over 60% of China’s total installed power capacity and roughly 42% of its electricity generation. 

In Europe, renewables account for  25.2%, and over 47% of all EU electricity, primarily driven by wind, hydro, and rapidly expanding solar. 

If we needed a prompt to understand that relying on imported fossil fuels is a major economic and security risk, then the Iran war was, or at least should be, that point. 

All those fools in Trump’s court, and our Conservative, Reform and Restore parties are lying, their interest is purely financial. 

Despite what the Walker Brothers sang, the sun will shine and the wind blow tomorrow. 

“The sun ain’t gonna shine anymore
The moon ain’t gonna rise in the sky”  

I am bored of the Starmer/Burham thing, its now blah, blah, blah.

The next point is what Burham will do, which I suspect he isn’t yet clear on.

Instead, we look to Trump’s America.

His trip to Iran was a disaster, to all intents and purposes he lost.

The new deal looks much like the old deal negotiated by Obama, brought about at considerable monetary and prestige cost.

One of the big losers are US citizens, with those left behind bearing the brunt of the pain. Of course, this is Trump’s MAGA-base, though I wonder how many are now rueing the cost of their choice.

One of the few winners from the Iran debacle should be the purveyors of renewable energy. That is excepting populists who regard the whole thing as a con, there only to make a few people rich.

The fact that a few people from “big oil” are funding the denial I order to become even richer seems to have passed them by!

It’s a funny old world; the PM gets criticised for a few donor paid for suits and glasses, whilst our would-be PM thinks £5m for now, no reason, is perfectly acceptable.

Maybe the heat has melted my brain?

Lyrically, we start with “Failure” by Swans, and play-out with . “The Sun Ain’t Gonna Shine Anymore” by The Walker Brothers.

Off to my deckchair!

Enjoy! Philip.

@coldwarsteve

Philip Gilbert is a city-based corporate financier, and former investment banker.

Philip is a great believer in meritocracy, and in the belief that if you want something enough you can make it happen. These beliefs were formed in his formative years, of the late 1970s and 80s

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