The Iran war is not at all turning out the way Donald Trump and his sycophantic administration[1] thought it would.
In the face of military defeat, Donald Trump has now threatened “that ANY country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face TREMENDOUS Economic Consequences. Oil smuggling, swap lines, cash transfers, exchange houses, ship registries, front companies — It all needs to stop NOW. You know who you are. This will be an ECONOMIC D-DAY, and we need all of our Allies to stand with the United States of America to isolate, and defeat, the Iran threat.”[2]
The BBC notes that “[w]hile China was not named in the post, businesses there are the biggest buyers of oil from Iran, a key source of Tehran’s funding.” China has a policy of rejecting any sanctions of this sort[3] and has said it would not recognize these either.[4] Russia would also be affected but is already under severe U.S. sanctions.[5] In any case, it seems unlikely that Trump’s sanctions against Iran can be any more successful than those Iran has faced pretty much continuously since its revolution in 1979.[6]
U.S. Treasury Secretary Scott Bessent says the Trump administration is telling the world, “You’re either with us or against us,” that “[i]f you insist on doing business with them — either transferring money, buying oil, doing seaborne ship transport — then the US Treasury and the US government, they will put its full might and force towards enforcing against you.”[7] We still do not know exactly what these sanctions will look like but the “us vs. them” formulation leads me to suspect that the sanctions to be applied to Iran will also be applied, at least in significant part, to countries that continue to trade with Iran.
If indeed the world must choose between China and the U.S., I rather strongly suspect that a lot of the world, possibly including many U.S. allies, some of whom have been estranged by Trump’s threats to annex their territory, and many more who now see the U.S. as an unreliable ally (see, for example, Canada[8]), will choose China. The U.S. could thus be economically isolated, and for a country so heavily dependent on imports—hence Trump’s obsession with trade deficits[9]—I’m having difficulty imagining how this isn’t economic—and hence political[10]—suicide.
[1] Neil Beasley and Madeleine Pickles, “Trump surrounds himself with sycophants. It’s a terrible way to run a business – and a country,” Conversation, May 28, 2025, https://theconversation.com/trump-surrounds-himself-with-sycophants-its-a-terrible-way-to-run-a-business-and-a-country-257391
[2] Donald J. Trump, “No one has given the Islamic Republic of Iran a greater opportunity to make a Deal than me. . . ,” Truth Social, August 19, 2026, https://truthsocial.com/@realDonaldTrump/posts/117124650907675461
[3] Grace Eliza Goodwin and Peter Hoskins, “Trump threatens ‘tremendous economic consequences’ on any country helping Iran,” British Broadcasting Corporation, August 19, 2026, https://www.bbc.com/news/articles/c2k7e83ynj4o
[4] Middle East Spectator, “The Chinese Foreign Ministry says it does not recognize U.S. sanctions against Iran . . . ,” Telegram, August 20, 2026, https://t.me/nothousebroken/641
[5] Stephen Quillen, “How China and Russia could hobble Trump’s plans to isolate Iran,” Al Jazeera, August 20, 2026, https://www.aljazeera.com/news/2026/8/20/how-china-and-russia-could-hobble-trumps-plans-to-isolate-iran
[6] Bernd Debusmann, Jr., “How much could Trump’s ‘economic D-Day’ hurt Iran?” British Broadcasting Corporation, August 20, 2026, https://www.bbc.com/news/articles/cre4gdvlj9ro
[7] Al Jazeera, “US Treasury secretary says new economic measures will ‘collapse’ Iran,” August 20, 2026, https://www.aljazeera.com/news/2026/8/20/us-treasury-secretary-says-new-economic-measures-will-collapse-iran
[8] France 24, “Canada vows to match US tariffs ‘dollar for dollar’ after failed trade negotiations,” August 22, 2026, https://www.france24.com/en/americas/20260822-carney-says-canada-will-match-us-tariffs-dollar-for-dollar-after-failed-trade-negotiations; Nadine Yousif, “Canada’s deal with China signals it is serious about shift from US,” British Broadcasting Corporation, January 16, 2026, https://www.bbc.com/news/articles/cm24k6kk1rko
[9] Daniel Dale, “These two new economic numbers blew a hole in Trump’s rosy narrative,” Cable News Network, February 21, 2026, https://www.cnn.com/2026/02/21/politics/economy-gdp-trade-deficit-trump-tariffs
[10] Julia Ioffe, “It’s the Foreign Policy, Stupid,” Puck, August 21, 2026, https://puck.news/will-iran-and-gaza-decide-the-2026-midterms/; Alexander Willis, “MAGA in ‘shambles’ as Trump betrays core vow to right wing: ‘Can’t believe I believed,’” Raw Story, August 21, 2026, https://www.rawstory.com/maga-2677755486/