Violence begets sell off
The US is still on track. It is still a very powerful empire, but so far, all of the major initiatives undertaken this century seem designed to help bring it down. This latest war is no exception.
Monday, March 2nd, 2026
Bill Bonner, from Youghal, Ireland
Oh my. Another Mideast war. And another assassination...another bombing...giving Donald Trump the distinction of having bombed more countries than any president in US history...and having participated in the murder of seven prominent foreign leaders. As to the pain, we doubt Americans will be totally spared. The Washington Post:
‘President Donald Trump is gambling that his attack on Iran will not cause Americans serious economic pain in the months before November’s congressional elections.’
But that bet may not pay off.
The Daily Mail:
‘Surging oil prices on the back of Iran strikes threaten to pile more pressure on household budgets…But paying a little more for gasoline is not like getting blown to bits by bombs. So far, Americans have been blessed. They bomb others; others do not bomb them.’
As to the war itself, we presume it will go about as well as America’s other wars of choice. Vietnam and Iraq come readily to mind. Not so much Venezuela. In Venezuela, Maduro had a lot of enemies. Many of them were willing to stab their jefe in the back in return for money and power, offered to them by the CIA.
That is probably not the situation in Iran. The Ayatollah has been martyred. Iran has 90 million people. Many of them are smart. And many of them won’t forget the unprovoked attacks by Israel and the US. They may find ways to get even.
That’s the trouble with violence; it often leads to more violence.
All we are sure of is that the US is still on track. It is still a very powerful empire, but so far, all of the major initiatives undertaken this century seem designed to help bring it down. This latest war is no exception.
Bush led off with his preposterous Wars on Terror, Afghanistan and Iraq. The costs were monumental. Strategic benefit? None that we know of.
Barack Obama further socialized medical care in the US (nearly 20% of the economy), leading to the biggest increase in health care spending in history. A typical employer-sponsored family insurance plan now costs about $2,000 a month.
In Donald Trump’s first term, he cut taxes — leading to larger deficits. Later, he panicked and shut down the economy for Covid — a colossal mistake. And then, he made it worse by borrowing trillions and sending out ‘stimmie’ checks, which set the stage for the worst inflation in 50 years.
Joe Biden followed Trump’s lead with another $1.9 trillion spending bill…and $8 trillion more in debt.
And, now in his second term, Trump continues to promote the two things — too much war and too much spending — most often cited as causes for imperial crack-ups.
Oil prices go up and they go down. But federal debt is on a one-way street...and picking up speed. War or no war. CQ News:
Last month, Rep. Stefanik celebrated securing $12.5 million for a tech accelerator in upstate New York that the Pentagon had not requested.
Congress added nearly $34 billion above the president’s fiscal 2026 defense request for more than 1,000 research and procurement programs favored by lawmakers but not necessarily by the military, according to a new report.
The $33.97 billion in a fiscal 2026 omnibus spending law (PL119-75) is a dramatic surge in appropriations...By comparison, the fiscal 2024 and 2025 totals for such programs were lower — at $21 billion and $14.95 billion, respectively.
War, however, makes it worse. Naked Capitalism:
After bombing Venezuela, the Trump administration raised its war budget from $1.0 trillion, 47% of discretionary government spending in 2024, to $1.5 trillion!
In 2024, the US accounted for over 36% of the world’s military spending of $2.7 trillion! This exceeded the total expenditure of the next nine biggest spenders — China, Russia, Germany, India, UK, Saudi Arabia, Ukraine, France, and Japan!
Fortune magazine projects that US spending will exceed that of the next 35 highest-spending countries combined!
The independent Committee for a Responsible Federal Budget projects federal debt for military spending will increase by $5.8 trillion over the next decade!
Where this war is going, we don’t know...but we’re pretty sure we know where the US economy is going.
You’re probably not going to like it.
Regards,
Bill Bonner