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Home » Amb. Chas Freeman: Israel’s Grand Plan Collapsed in Record Time (Transcript)

Amb. Chas Freeman: Israel’s Grand Plan Collapsed in Record Time (Transcript)

Editor’s Notes: In this compelling episode of Dialogue Works, host Nima Alkhorshid is joined by veteran diplomat and geopolitical analyst Ambassador Chas Freeman to discuss the swift collapse of Israel’s long-term regional strategy. Freeman offers a sobering analysis of how recent escalations with Iran have backfired, leading to a significant shift in power and a reevaluation of security alliances among Gulf states. This conversation delves into the broader implications of these developments, signaling a historic decline in U.S. hegemony and the birth of a new geopolitical reality in the Middle East. (May 1, 2026)

TRANSCRIPT:

The Cost of the War on Iran

NIMA ALKHORSHID: Hi everybody, today is Friday, May 1st, 2026, and our dear friend Ambassador Chas Freeman is here with us. Happy May Day, Ambassador, and welcome back.

AMBASSADOR CHAS FREEMAN: Happy May Day to you, Nima. I’m glad to be with you.

NIMA ALKHORSHID: Let me start, Ambassador, with what was happened 2 days ago. The Pentagon was asked how much did they spend so far with the war on Iran, and here is what was the response from the Pentagon.

VIDEO CLIP BEGINS:

UNIDENTIFIED SPEAKER: We have not yet received from the Pentagon the cost of the war. So just for the record, we’d like to get that as soon as possible, certainly the munitions expended, but also underreported is we’ve had a fair amount of equipment destroyed, including 2 C-130s with the rescue of our downed airmen. So, do you have either A, a cost estimate coming to us anytime soon, or B, a specific supplemental request?

HURST: Thank you for that question. So, approximately at this day, we’re spending about $25 billion on Operation Epic Fury. Most of that is munitions. There’s part of that is obviously O&M and equipment replacement. We will formulate a supplemental through the White House that will come to Congress once we have a full assessment of the cost of the conflict.

UNIDENTIFIED SPEAKER: So you’re saying the full cost at this point is $25 billion?

HURST: Yeah, that’s our estimate for the cost.

VIDEO CLIP ENDS:

NIMA ALKHORSHID: Yeah, here is later on we had US officials telling CBS that the cost of the war so far is close to $50 billion. It’s doubled the one, the number that Pentagon gave us. What is your understanding of that? Which number is closer to the reality?

The True Cost of War: Beyond the Numbers

AMBASSADOR CHAS FREEMAN: I think the higher number is closer, but even that is probably an underestimate, because there’s so many costs connected with war that don’t become apparent until much later. For example, wounded people— there have been a lot of people wounded in this war. The cost of their medical care, and eventually their treatment by the Veterans Administration, which has a separate budget from the Defense Department.

So there are some estimates, I think [Dr. Bill Mays], who’s at Harvard and who works with the Cost of War Project at Brown. She and Nobel Prize winner Stiglitz, economist, have done various estimates of what other wars, for example, the Iraq War, the Afghan War, and so on, have cost. And she’s estimating that the ultimate cost of this war may be as high as $1 trillion when you bring in all the additional costs.

And this is very relevant, not because the Congress— the Congress basically treats the defense budget like a jobs program. It’s not derived from a threat analysis. More is always better. And of course, the Trump administration is asking for $1.5 trillion and probably $200 billion for this war as a supplemental. We don’t know the figures yet, but it’s clearly a great deal more expensive than the Defense Department spokesperson, Mr. Hurst, mentioned.

NIMA ALKHORSHID: Do you think that they’re considering the spending on the part of Israelis as well in terms of ammunition and the interceptors, cruise missiles that they’ve used?

A War of Attrition: The US-Iran Standoff

AMBASSADOR CHAS FREEMAN: No, I suspect that is budgeted separately. Not included. And, you know, essentially where we are now, Nima, if I may, is we’re in a war of attrition, an economic war of attrition. Basically it’s as though the United States and Iran were two wrestlers, each one trying to strangle the other. We have our hands around the throat of the other party. We don’t know who is going to lose consciousness first. Somebody’s going to drop out because they can’t take it anymore.

And there are lots of factors here. The administration, the Trump administration, clearly calculates that— I think on the basis of wrong understanding of the petroleum industry— they calculate that Iran, in 3 weeks or 2 months, depending on which expert you talk to, will begin to lose pressure. It will run out of storage space for its current level of production of oil, and the reservoir pressures will begin to drop. And if they drop far enough, it’s then very hard to restart the oil wells.

I think that’s a misunderstanding. First of all, of course it is a geological reality that if the pressure drops in an oil reservoir underground, it is more difficult to recover oil in the future. It’s not impossible. But I don’t think this takes into account either the geology in Iran or the ability of the Iranian oil company to reduce production without destroying the reservoirs. In other words, they can produce less oil but still produce oil, and they can probably find storage for it somewhere. We know that there is an effort being made now to use the rail connection to China to move oil out of Iran. Iran can also presumably draw on the Russians through the Caspian Sea connection. So I think that this estimate on the part of the administration is essentially unrealistic.

Oil Prices, Inflation, and Global Recession

On the other side, Iran calculates that the price of oil and gas internationally is going to go up very high.