A week ago, President Trump effectively declared victory in the Iran war. “We’ve won. Let me tell you, we’ve won,” he said during a speech in Kentucky. “You know, you never like to say too early you won. We won. We won the, in the first hour, it was over. We won.” Of course, this being Trump, he also said that the United States and Israel had to “finish the job.” Days earlier, he had said the war was “very complete … sort of.” And on Friday, when asked by Fox News’s Brian Kilmeade when the war would end, Trump said, “When I feel it, OK? I feel it in my bones.” So the war has been won, but actually it’s not over. It will only be over when Trump decides it is. Got it?
As a general rule, if someone gives conflicting answers to the same question, you can assume that they don’t have an actual answer. And if they proclaim that they’re in full control of something, you can assume the opposite. That’s undoubtedly where Trump, in the third week of this war, now finds himself. Things have not gone according to plan—perhaps because his apparent plan was to bomb Iran into submission with days and assume not retaliation of any kind—and now the conflict is spiraling out of his control. Will Trump, to invoke one of liberals’ favored insults, “chicken out”? Or is he already beyond the point of no return?
When Trump made those statements above, the war was already shifting gears and beginning to evade his grasp. Within days of being attack on February 28, Iran announced that it would attack any ships trying to pass through the Strait of Hormuz. Maritime traffic in the key waterway ground to a halt, choking off roughly a fifth of the global oil supply, and accordingly gas prices around the world have skyrocketed. So although the U.S. and Israel have indeed pummeled Iran, its regime does not appear in danger of collapse. In fact, though its retaliatory strikes have dwindled over the past week, the regime has located an effective pressure point that could force Trump’s hand.
No need to take my word for it. “We clearly just kicked [Iran’s] ass in the field, but, to a large extent, they hold the cards now,” a “person close to the White House” told Politico for an article published Tuesday. “The terms have changed,” a second person “familiar with the U.S. operation in Iran” told the outlet. “The off-ramps don’t work anymore because Iran is driving the asymmetric action.” Iran’s leaders say they’ll only reopen the strait if the U.S., Israel, and other Gulf States agree on a new security arrangement that aligns with its interests. And military experts in the U.S. all acknowledge that forcibly reopening and securing the strait would require boots on the ground on the Iranian coast.
While this shift in the war’s dynamics begins to dawn on officials in Washington, the financial world appears more sanguine. Here’s Morgan Stanley analyst Michael Wilson: “The bar remains high for the oil spike to threaten the business/earnings cycle ... We maintain our view that this correction is closer to its ending stages in time and price.” Bank of America global economist Antonio Gabriel took a different view, however: “While a quick resolution to the conflict is certainly a possibility, we view the conflict extending into 2Q as an equally likely outcome, and a more protracted war cannot be ruled out. .. In our view, the more disruptive scenarios for global growth are underpriced.”
Many on Wall Street probably still expect this war to follow the usual script. In the past, Trump has used U.S. military might in bold, often reckless ways. He has embraced large-scale bombing campaigns (dropping the “Mother of All Bombs” in Afghanistan during his first year in office in 2017, and bombing Iranian nuclear facilities in the Twelve-Day War last June), assassinated powerful officials (IRGC commander Qasem Soleimani in 2020), and kidnapped and extradited others (Venezuelan President Nicolás Maduro in January). Many of these operations resulted in market turbulence, but they were all either limited in scope or Trump quickly pulled back, settling to spin the initial gains as a huge “win” without taking riskier actions that could draw the U.S. into a long-term quagmire.
TACO, or Trump Always Chickens Out, isn’t a perfect descriptor for this tendency because it downplays the destruction these actions have caused (and do we really want to be goading Trump into doing more harm?). But the acronym’s not exactly wrong, either. Historically, Trump really has backed down before things have gotten too bad, and it’s safe to say that both economic and political leaders acclimated themselves it. Many of them are undoubtedly expecting, or at least hoping for, a similar conclusion to the Iran war—that the bombing will end, the Strait of Hormuz will reopen, gas prices will fall, and this will all be a distant memory within a matter of months.
But the Politico story and other recent reporting suggests something else entirely: that the point of no return in the Iran war has nearly arrived, if it has not already passed. Trump has lost control of the war, and the only apparent way for him to regain control is to either put boots on the ground—the only political red line for Trump that, ten years into his political career, he’s adhered to—or to drawn down the bombing and declare that his objectives have been met.
For now, the bombing will persist. On Tuesday alone, Israeli strikes killed Ali Larijani, secretary of Iran’s Supreme National Security Council, and Gholamreza Soleimani, the head of the IRGC’s Basj Force. But if killing Khamenei wasn’t enough to bring Iran to heel, these latest deaths won’t do anything to bring about a resolution to the war.
The problem, of course, is that Trump never stated clear goals for the war, and thus it’s not clear how it can be resolved to his satisfaction. Since the bombing began, he has suggested that he wants to eliminate the country’s nuclear program and foment regime change. The former would likely be impossible to accomplish without occupying the country, and there is zero evidence that the latter is in the offing. So where does that leave Trump? Does he put boots on the ground to “save face,” as that person “close to the White House” told Politico? Or does he chicken out?
Let’s hope that TACO holds true. I can only imagine what might happen to this world if Trump stops chickening out.
