Editor’s Note: In this episode, Professor Michael Hudson joins host Glenn Diesen to discuss the global economic fallout of the unfolding war involving Iran. He explains how the United States utilizes an energy wars strategy to lock in foreign dependency as its own economy loses competitive and industrial dominance. Ultimately, Hudson breaks down how these escalating geopolitical conflicts risk plunging the global system into a severe financial crisis and a multi-year depression. (May 29, 2026)
TRANSCRIPT:
The Iran War and Its Impact on the Global Economy
GLENN DIESEN: Welcome back to the program. We are joined today by Professor Michael Hudson to discuss how the Iran war is affecting the global economies.
I heard from some people that while the energy prices are high, that the US could actually benefit from this because then they would have to pay more money for American energy. This would also mean that they would have to pay in dollars, so it would just strengthen the petrodollar.
On the other hand, I can’t help but to think that this doesn’t sound very sustainable. That is, with war, energy shortages, it would trigger more of a global depression.
So I just wanted to get, I guess, your overall view on this, how you see the Iran war affecting the economy.
The Coming War with Iran and Its Global Economic Consequences
MICHAEL HUDSON: I’m glad you asked the question in the broad sense, because no matter what, even if there were no war at all, the energy prices are going to be very, very high, at least through the rest of this year. And this is if there’s no war, because there’s already a long delay.
The real problem is, of course, that there’s going to be a war breaking out very soon, probably by Monday, maybe by Sunday. There have been no real negotiations at all. In fact, it is impossible for any of these negotiations to have any effect on the military situation or the peace situation.
One of the absolute requirements for a precondition is that Iran says that the United States has to begin releasing some of the bank funds and the money that it’s confiscated. Most recently, the stablecoin, many billions of dollars that the United States has intervened and grabbed, which essentially makes stablecoin a very unsafe investment for any country whose government may pursue policies that the United States government believes is too much self-sufficiency, too much autonomy to tolerate.
The United States cannot possibly agree to return any money at all to Iran because Congress has already said, through South Carolina’s Lindsey Graham and also Texas Senator Cruz, “not one penny for Iran,” claiming that Iran is a terrorist country for responding to the Israeli terrorism by defending itself.
The defenders are called terrorists, just like when Ukraine attacks Russia ever since 2022, the Russians are called terrorists for defending themselves, just as the Palestinians are called terrorists for defending themselves against the Israeli genocide, just as Hamas is called a terrorist and Hezbollah are called terrorists for preventing Israel from bulldozing and destroying the whole south of Lebanon, which was largely Shia religion, not Sunni, and not the Christian Phalange leadership.
So, given the absolute right-wing neocon anti-Russian, anti-Chinese, anti-Iranian feeling of the Congress, any agreement that Trump’s negotiators might achieve with Iran could never be put into practice anyway. And Iran has been lied to so many times by the United States, or the United States simply going back on its word, like Trump annulled the Obama administration’s atomic weapons contract, that it’s not going to make any concession at all until such time as it gets something in return in advance.
It’s sort of like an author going to a publisher. The advance that you get from a publisher is all the money you really are ever going to get in practice. Well, that’s what Iran says. They don’t expect the United States to live up to any deal, but if Trump somehow can give them some satisfactory negotiated portion of the $100 billion plus that it’s grabbed illegally from Iran, then it will make some concessions. But the concessions are nothing at all like what Trump has announced.
Market Manipulation and the Illusion of Peace Negotiations
The announcements by Trump and Hegseth have only one purpose, to achieve what they’ve achieved this morning in the New York Stock Exchange. Stocks are up, bonds are up, prices are up. There’s a belief that somehow there’s going to be a peaceful negotiation here. There’s a fortune to be made when the markets open Monday or Tuesday or whenever the response is, with the US telling Netanyahu, “All right, it’s okay to attack now.”
In the last day or two, the war secretary, Hegseth, had talked to the heads of Oman and Qatar, and said, “Well, if you, Oman, don’t agree not to join Iran in imposing the tariffs,” which is Iran’s means of at least beginning to obtain some reparations for the illegal attacks that are done, “then we’re going to let Netanyahu kill you.” And apparently the Omani negotiator simply hung up the phone and made a complaint to Trump, saying that when you’re negotiating and say, “Either you agree with us or we’ll kill you,” this stops all negotiation.
And that essentially is exactly what the United States has told Iran. If you don’t negotiate, as President Trump has said again and again in recent days, “We’re going to destroy you like no country has ever been destroyed before.”
So Iran is all ready for this. It is going to destroy all of the military bases in the Middle East by the United States, including the largest military base in Israel. And you can expect that this is going to be the peak of the war that has been building up ever since Trump took office a year and a half ago.
The Economic Fallout: Depression Worse Than the 1930s
And of course, what this is going to do is create such a shortage of oil, of fertilizer, of sulfur, of chemicals, of helium, that the world is going to be plunged into a depression that is worse than the 1930s.
The initial effect, according to ExxonMobil, the old Standard Oil monopolies, is going to push the oil prices up to over the $150, $160 a barrel range. This is going to force the closing down of much chemical industry throughout Asia and the Global South and Europe. And it’ll block the fertilizer export. So this is going to reduce agricultural yields, on top of the fact that this summer looks like it’s going to be one of extreme weather. So you can expect food prices to soar, industries to close down.
One effect of the manufacturing industries and the chemical industries closing down is going to be that the demand for oil will decrease. It’s called demand reduction. And the price of oil may fall back to maybe $120, $130 a barrel, but there’s going to be large-scale defaults and bankruptcy. And that’s going to turn what is a technological and a direct industrial depression into a financial crisis, because the economies throughout the world, from the United States to Britain to continental Europe, are so heavily debt leveraged that it takes only a small amount of declining revenue to prevent the companies that have been taken over by private capital, and other highly debt-leveraged industrial companies, to default on their bank loans.
There has been a rising market in collateralized debt obligations. These are the gambles, the casino gambles that essentially caused the bank crisis and the failures of insurance companies and other players back in the end of 2008. We’re in a replay of all of that. But this time there’s no way of getting out of the financial depression that is caused from Europe to the United States by having their central banks simply create more credit, because there’s already so much credit given to these companies that the economies are loaned up.
Banks are not willing to continue to lend their industrial customers, their private capital customers, their financial customers, their real estate customers, and agricultural customers the money to pay the interest. That would be to turn the US and European economies into a Ponzi scheme. You keep lending money and you hope that this money you’re lending to creditors is going to keep the real estate market, the stock and bond markets afloat, so that banks don’t have to show negative equity on their balance sheets as they were doing at the beginning of 2009. So you can look at this as a replay.
The Atomic Weapons Pretext: A Deliberate Deal Breaker
Well, it’s amazing that the markets haven’t seen this. You could see it from the very beginning, because when Trump said nothing will happen until Iran agrees to turn over all of its atomic weapons, this is the same pretense that led George W. Bush to go to war with Iraq. There were no weapons of mass destruction. The national security agencies of the US have said Iran has made no move to achieve an atom bomb for the last two decades.
So when Trump says, “We, all of this is to protect Europe and to protect the world from Iran’s atom bomb,” this means we are purposely putting in a red herring that cannot be solved. Because we might as well ask Iran to turn over the flying saucers that it allegedly has. It’s just bizarre. It’s a deal breaker from the very beginning. And the intention is to be a deal breaker. There’s no way it’s not — or I should say it’s not a deal breaker because there’s no deal. It’s a deal preventer from the beginning.
The United States apparently thought that time was on its side and that the sanctions that it had imposed on other countries to block them from trading with Iran would somehow starve Iran into submission. Well, that policy has not worked since 1979 when it was first put in place by the Carter administration, and it’s not going to now.
The whole purpose of this red herring is just to prevent any kind of serious negotiation. But America, for some reason, wanted the illusion that it was trying to negotiate peace. And then it’s trying to now provoke Iran into making some kind of a defensive response against a US probe, that is going to be construed as, “Well, America’s only reacting to Iran’s terrorist attack.” A terrorist attack by our own bombers or the Israeli bombers or whatever the United States has up its sleeves for this Sunday, Monday, or sometime next week.
Parallels with the Minsk Accords: Time Is No Longer on America’s Side
What’s so surprising from a military point of view is, in a way, this is the same kind of stalling that you had with the Minsk Accords between NATO and Europe, when the Minsk Accords asked for cessation of hostilities, just as Trump is asking for a month or so cessation of hostilities. Well, in the Minsk Accords, the whole idea was to enable NATO to rearm Ukraine to fight Russia. So the stalling was on the side of the United States and its NATO satellite.
But this time, time is not on the US side, because the US has its whole navy all there. It has its refueling airplanes, apparently in the Emirates, all ready to take off and to fuel the air attacks that are planned to come in there. Well, it’s obvious that the Iranians have their plans about this. They’re ready to retaliate. They have used this time to actually arrange their diplomatic ties with Russia, with China, and to prepare their military while the United States Navy and Air Force are baking in the heat of the Middle East. And so time is on Iran’s side, as it has been for the last few decades.
The United States cannot achieve by sanctions anything that it hasn’t already, because Iran has got used to living with them. So you’re going to have essentially a no deal.
International Law and the Strait of Hormuz
The final demand that the US is making is claiming that Iran’s attempt to impose fees, transportation fees, on ships going through the Strait of Hormuz is against international law. But the big picture for everything we’re discussing, Glenn, is there is no international law.
You’ve seen already last year, there’s no international law of the sea specifically. Last year you saw American planes bombing Venezuelan fishermen and Colombian fishermen on the west coast of Latin America, saying that, “For all we know, they’re carrying drugs.” That’s against international law. There’s zero evidence that they were carrying drugs, because the boats were attacked without warning, without any attempt to say, “Stop, let us board you, let us look to see whether there are drugs.” And in fact, it turned out they were indeed fishermen.
Well, this week, America began to attack Arab and other fishermen in the Strait of Hormuz. For many centuries, it was a fishing center. It was a pearl fishing center. It was a thriving maritime center. Apparently there are photographs showing that indeed these were fishermen with fish on their boats. The United States said, “Well, for all we know, they’re really laying mines. Maybe these fish were mines made up to look like fish.” But the claim is that what any civilian is doing might be military.
Just like Netanyahu has said, any Palestinian civilian person may be an enemy because of what we’ve done to them. “We’ve made them so angry at us that of course we’ve made every Palestinian an enemy. Therefore, we are permitted to kill all Palestinians in self-defense because they’re defending themselves against what we’ve done to them.” This is the fiction that is framing the whole US side of the discussion. And it’s been repeated in much of the European press.
The Collapse of the International Order
And the ultimate basis for all of this in international law is the United Nations Charter. But the United Nations is one casualty of the war with Iran and NATO’s war against Russia at the same time. The United Nations has been unable to impose any of the laws in its charter. It’s been unable to have any army of its own. And in fact, it’s been taken over — or blocked rather — by the United States with its veto power through the Security Council and its European satellites.
So what can the rest of the world do? I’m surprised that just as the stock markets throughout the world don’t realize that there is an absolute break, the politicians of other countries throughout the world have not seen that, well, if we’re going to have a road to peace, we have to create a new United Nations — not a new charter, but a new organization independent of the United States. Well, the only kind of organization that can have a prototype for this would be one that has as its leading members China, Russia, and Iran.
But I want to point out that the United Nations Charter warned that if Nazism were to reemerge in Japan and Germany, for instance, then the other countries were permitted to take all necessary measures to stop it. And I assume that any treaty that Iran would sign would have to specify the consequences of Israel attacking one of its neighbors or Iran again. It has to stop ethnic and racist genocide.
The Resurgence of Nazism and the Replay of World War II
This is the same kind of Nazism that you find supported by Germany and Britain now in the war against Russia. The racist claim that Slavic speakers are subhuman and cockroaches — this is word for word Netanyahu’s claim that the Palestinians and the Arabs are cockroaches. This is the same claim that the Sunni head choppers in Syria under Jalani are claiming under the Wahhabi system: “We have to kill all of the non-Sunni people.”
You have this US-backed resurgence of everything that at the end of World War II was looked at as the essence of Nazism, the essence of an attack on the principles of civilization itself — as if all human beings, all races, no matter what language they speak, are human beings. Not that if you speak a different language, you’re a subhuman and therefore international law only applies to human beings, not to people that are under US attacks.
And the US, Germany, the European Union, and Britain have said any country that is under attack is basically immune from protection under international law. And they have this same fanaticism that you had by the Germans in World War II.
And if you want to see what would happen under this scenario, look at what happened to all of the Nazis that were hired by the United States in 1945, given protection, sent to Latin America, and essentially steered many of the American client oligarchies and client militaries into the dictatorships that have retarded Latin American development for the last 80 years.
This is essentially what is happening now. It’s as if the world is now fighting World War II all over again. Once again, the European attack on Russia — this time not only by Germany, but pulling along the whole European Union and Britain — and also the US backing of Japan to have new nuclear weapons to reattack China, as it did in the 1930s. All of this, if you look at the alignment, this is a replay of World War II, as if the United States and Europe are saying, “We’ve decided that the wrong side won World War II. We’re going to start it over again.”
A Century of US Oil Strategy
And in order to achieve this victory over other countries, what you’re seeing in Iran is part of the US policy that has been based for a century — as you and I have discussed on earlier shows — of controlling the whole world’s oil trade. Because if you can control the world’s oil, then you have the power to turn off the electricity, the lighting, the gas, the home heating, the chemicals of other countries that do not trade with you.
The US fight in Iran from the very beginning, 50 years ago, when I was sitting in discussions about all of this, when I was working with the Hudson Institute, with the Pentagon and other US agencies — they all had plans for exactly what is happening today in Iran. They had plans to break Iran into 5 different statelets, starting with Balochistan, just as is happening today. The US tried to do it through the Kurds. That didn’t work. So there was some effort to create a crisis in Balochistan. It didn’t work.
So I wanted to put this in context: the answer to your question isn’t simply micro — what is happening this weekend — it’s what the big strategy is. And when you realize that this strategy has been adopted by the governments of Europe, the governments of the United States and its allies in other countries, then you realize that it doesn’t matter what the voters say anymore.
The voters in Europe, according to the public opinion polls, they’re against the war with Russia. They’re against the genocide against the Palestinians. They’re against the Israeli attacks. And yet Germany and Britain have rules that if you criticize Ukraine, if you especially criticize Israel and defend the Palestinians against this genocidal attack, you can be sent to jail. It’s a crime. They’ve criminalized the support of international law as defined by the United Nations reporter and her accusations against Israel.
Now they’ve isolated her personally. They’ve isolated the judges of the International Court of Justice that have brought essential crimes against Israel. What’s happening now is not simply an interruption of the oil trade. It’s an interruption of the whole international arrangement of diplomacy that was put in place 80 years ago.
A World at a Breaking Point
The whole world has achieved a breaking point, a splitting between the US and Europe on the one hand, and Iran — that has been driven into an alliance with China and Russia — taking the lead
The Economic Squeeze on Europe and the West
GLENN DIESEN: Well, before you mentioned that time is on the side of Iran, and the US had assumed that time would be on its side. That is, it could essentially now go from this high-intensity war, which became too resource-demanding, and bring it down to low intensity and drag it out. But the Gulf States appear to be going from bad to worse from day to day. And we heard now about these swap lines being set up. I was wondering, how do you see this? How would you explain what is a swap line and why is it so significant?
MICHAEL HUDSON: Well, you’re in Europe, and as I understand it, the European economy is being squeezed just as the US economy is being squeezed. Already, the rise in oil prices is forcing many families, many wage earners, many employers in many industries into debt. And the government has been trying to cope with this by giving some subsidies for homeowners and renters and just the population at large to be able to live with this.
There’s been a wholesale drop of sale of the US petroleum reserves and the petroleum reserves of other countries saying, well, maybe we can just run down these reserves for a rainy day. This is a rainy day. What they don’t realize is this is a rainy year. Or this is a rainy 2 years, that it’s not a day after which the oil reserves can be filled up.
Europe and the United States are following a form of desperation to deal with this. Well, how long can the reserves last? The estimates are 30 to 45 days, and then they run out, and then there’s no way of continuing the subsidy of budgets of people who drive cars, who use electricity, of trucks who use diesel fuel, of airlines who use air fuel. All of this is going to run out. So time is on the side both of Iran and Russia and China, and the Western economies are self-destructing.
Especially in Europe, with Germany, where you have the German leaders and the European leaders in general say we have to be part of this new war. “It’s the last war that we have to win” — World War II for the German-European side. “It’s the last time we have to fight Russia because we’re getting weaker and weaker. And it’s never going to be as less bad a time as it is right now.” And so we have to use our national budgets to subsidize a war industry, not our regular commercial industries, not our consumers and wage earners.
And I don’t know, this is going to create the same revulsion among voters that it’s created in Britain, which I think seems to be the most desperate economy right now, where you have Britain turned to essentially libertarian policies, the anti-war policies, just as Germany is trying to ban the Alternative für Deutschland party. Essentially, they say any party that is against the war is against civilization. “This war to destroy our countries that America says are our enemies is a war of civilization. We can ban any political party that is against the war.” This is military dictatorship or an oligarchy, whatever it is. It’s not democracy.
And yet nobody’s really spelling out what this means. How did this takeover occur? How did Europe come, and other countries, Latin America, how did they come to have presidents and an army and what’s called the deep state independently in control of government, that the voters seem to have no impact on, no ability to say, can’t there be a plebiscite on whether to have war or not? Well, the laws of almost every modern democracy say, nope, no plebiscite. You can only vote for individuals as head of the party, and these individuals may all have a similar political view about the war and peace. So the democracy itself has been closed off as a result of this war.
The Energy War Strategy and America’s Foreign Policy
GLENN DIESEN: Well, my last question was just about, again, I want to return to the energy aspect because, well, if we take a step back and not just look at Iran, this seems to be a common thread in a lot of America’s wars lately. For example, Venezuela. When before they went into Venezuela, they were quite open that it’s not just about the objective, that it was not only about Venezuela having to be open for the United States, but it also had to close itself off to countries like China. We then saw the same logic when the US helped to cut off Europe from Russia. Again, the Europeans have some agency, they’ve done a lot of this to themselves, but the destruction of Nord Stream, for example, appears to have been the work of the United States. And we see the same discourse around Iran. That is, many US senators and think tanks are making the point that, yes, while there might be a double blockade now, the US still gets its energy, but this is reducing supplies to China yet again. So there seems to be a common thread here again about, I guess, restoring dominance over energy markets. Do you see any cohesive strategy though, which could succeed, or where are the holes in this strategy?
MICHAEL HUDSON: Yes, I spelled out that strategy in articles that are on my website quite a few times, and the United States spelled it out, I think, 2 weeks into Trump’s administration. He said, “Our foreign policy is based on control of oil.” And the oil — if we can’t control the oil of other countries, we will destroy their oil facilities so that other countries have no alternative but to depend on our weaponization of the international oil trade, so that we can turn off their gas, their oil, their agriculture, and their chemical industry if they do not join the allied side of us against Russia, China, and any of their supporters such as Iran.
So the United States said, all right, to prevent other countries from being alternative sources of oil that would break America’s ability to weaponize the oil trade and turn off the spigots for the whole rest of the world. You had, as you just pointed out, the destruction of the Nord Stream pipeline and the sanctions against trade with Russia. So you’ve had the same problem now with Venezuela. They first imposed sanctions on Venezuela, and then finally they attacked it and conquered Venezuela. And now all of Venezuela’s revenue from the oil trade is paid into a bank account in Florida under the personal direction of Donald Trump and his appointees. And that’s what the United States wants to do in Iran.
Well, without Russia, Venezuela, and Iran providing independent supplies of oil, the United States will be able to weaponize the oil trade just as it weaponized the grain trade in agriculture by imposing sanctions on exports to China after Mao’s revolution in the 1950s. Canada broke that attempted cutoff by selling grain to China.
The United States is no longer able to achieve foreign dominance by being an industrial power like it was before, or being a financial power. The only way that the United States can control other countries is by creating chaos, by saying, “We will create chaos in your foreign trade, and therefore in your industry,” just as we did when Trump imposed his tariff policies. “And we can agree to soften this chaos that we’re causing if you’ll agree to join our fight against Russia, China, and any country that is growing in a way that uses its economic surplus and its financial surplus to promote its own prosperity instead of transferring this surplus to the United States.”
This is essentially the United States acting as the new robber baron in the world economy. And that is the explicit strategy of US foreign policy. It was all spelled out last December in America’s National Security Strategy report, to follow up on Trump’s announcement a year and a half ago that energy is going to be the key to our foreign policy. It’s all there in black and white.
Europe’s Surrender and the Weaponization of Energy Dependence
Other countries somehow have lived in the short run. Europe in particular, as we’ve discussed, have just surrendered to United States demands. And this is crazy. When a country surrenders to the US demands for oil or for anything else, the US just ups the ante.
And you had mentioned earlier that Trump has said, well, the United States can end up as the big winner from this cessation of oil trade. The rest of the world will now be in a depression, but we in America are self-sufficient in oil, and we have Venezuela’s oil now. We have Canada’s oil. We can block the trade for Russian oil through the Arctic by invading Greenland, so that countries can’t get to the Arctic from the North Atlantic.
You had last week Iceland saying, well, we’ve been independent for centuries. Maybe we should join the European Union and the European Union will defend us against America’s attempt to not only take over Greenland but take over Iceland, so that it can control the North Atlantic access to the Arctic through Iceland’s vicinity. I mean, you have the whole world aligning itself for this military conflict all around oil.
And what’s happened is that to keep prices down, the United States has been using the short-term palliative of selling the oil reserve. The oil reserve has not really kept down the oil price in the United States because almost every barrel of oil that the US Petroleum Reserve has sold into the US market or sold directly to Asian countries, allies, at a discount has been matched by US exports of natural gas and oil, LNG exports. So the United States oil companies have made a bonanza by producing low-priced US gas, US natural gas and oil at US costs and prices and selling them abroad.
Blocking Alternative Energy and Divide-and-Conquer Tactics
That’s basically what Trump meant, and his policy of trying to maintain this oil lever of control over other countries requires not only blocking other countries’ use of alternative sources of oil, but alternative sources of energy — wind power and solar power. So Trump has canceled almost all of the US investment programs in windmill power because that is a rival to oil in the United States. And he represents the oil industry. And he points out, well, the windmill blades are mainly created in China, and China’s the beneficiary of wind power. Can’t have that. Same thing for solar panels. China is the main manufacturer of solar panels. And so America has essentially fought against the climate change efforts by the Paris Group and by other groups. It’s trying to deter Europe from pursuing solar energy and wind energy, and is trying to lock Europe into dependency on US LNG and oil exports so that it won’t have any alternative at all.
Well, of course, China itself has made huge investments in solar energy, especially in its western, northwestern provinces, including Xinjiang. And so the United States is trying to do its usual mischief in China by trying to promote a separatist movement among the Uyghurs. The Financial Times today has a long big read all about how the United States is trying to do that by claiming that this is a fight against Islam. They’re trying to play the race card and the religious card. “If we can just divide and conquer, if we can divide populations into different ethnic groups, different religious groups, different political groups, then other countries cannot get their act together and have a coherent response to create an alternative to the US national security strategy.”
Which isn’t security at all — it is to prevent any other country from having the security and self-sufficiency and independent autonomy from the United States. Other countries must remain dependent on the United States for their oil, for their computer technology, for their internet technology, for their arms, including Europe. All of the European arms, largely from the United States, are subject to US repairs, US control, US ability to stop the airplanes with all of the control switches that they have. Europe is completely militarily as well as energy dependent on the United States, and any attempt to make Europe either independent or following an ability to have free trade with China and Asia, Russia, Iran, or other countries that are not in the US orbit has been opposed by all of the political parties in power.
Will the US Strategy Succeed or Consume Itself?
GLENN DIESEN: It’s interesting to see now that the United States can’t really compete in the same way it did in the past, that is, compete economically. We see all this weaponization of dependence because obviously the energy war strategy being developed is one thing, but there’s also these efforts to weaponize and limit access of technologies, which is used against China. Of course, limiting and weaponizing transportation corridors as piracy is now becoming a common phenomenon, limiting the access to banks, the use of the dollar.
Yeah, even if it’ll be successful, it’s breaking down the entire international economic system. So it’s hard to see how the world isn’t going to plummet into a crisis as a result of this. Do you have any final thoughts in terms of where this will probably go? I mean, will the US be able to essentially enhance its relative power vis-à-vis the other great powers, or will the chaos it’s unleashing essentially consume the US as well?
Europe’s Economic Suicide and the Future of Warfare
MICHAEL HUDSON: The United States looks at chaos as an opportunity to lock in foreign dependency. If the chaos takes the form of a close-down of European and other industries, then the other countries are going to be dependent on the US to somehow rescue them either by opening the US market to them by subsidies or by just imposing their own client oligarchies and client political parties.
You can look at the Christian Democrats, under Merz, as a client party of the United States. You can look at France under Macron as a US client. You can see certainly Britain under Starmer is a US client. The United States is not averse to saying this is the end of Europe, Western Europe, as any possible industrial competitor for the United States.
And essentially it’s as if the United States is saying, if our industry is no longer competitive and we’re shut down, we’re going to make sure that our trading partners also are also non-competitive in order to prevent them from turning to the economies that are still growing with their own self-sufficiency, the trinity of Russia, China, and Iran that’s emerging.
So the result is going to be other countries in the US orbit are going to have to choose. Are we going to be part of the declining US access, or are we going to try to turn to the part of the world that is not financialized, not under US control, not obliged to turn its economic surplus into US arms purchases for airplanes and missiles that don’t work, as we’ve seen in the fighting against Iran, and keeping all of their savings in the form of loans to the US Treasury through their Treasury security investments.
And America’s demand that Germany, Japan, Korea, and other countries relocate their industry, their heavy industry, manufacturing and chemicals and computers to the United States. Is Europe going to relocate its industry to the United States or it seems to so far have been relocating into China. Well, the important thing is all of this is being relocated outside of Europe. Europe is in effect committing economic suicide as a result of all this.
This is to America not chaos. This means that Europe is reduced to the same kind of dependency that Latin American countries have been reduced to ever since World War II. And the US support of military dictatorships throughout Latin America that essentially rule by client oligarchies. That I’m not sure, for Europe, this requires a political revolution.
The result is not going to be simply a rise in oil prices closing down industry. This depression is going to have the same effect that depressions have, a political revulsion by saying the current system doesn’t work, there must be an alternative.
Well, in the past, you could say that the Great Depression was pulled out by World War II, but World War II was a fight of armies, of soldiers, and future wars are not going to be a war of armies. They’re going to be air wars. They’re going to be fights settled by missiles, bombs, and drones, not by invaders. No country has the armed forces that can ever invade another country again. Invasions don’t work. You’re seeing the problems even that Russia is having in Ukraine for all this.
Invasions don’t work. All you can do is destroy other countries. Purely destructive war, not invading to create a new government along Western lines, which are now the old Nazi lines, basically, turns out.
GLENN DIESEN: Well, thanks again for your insights, and I left the link to your own site in the description, and I would advise everyone to read your articles, as I would do with increased frequency. So thanks again.
MICHAEL HUDSON: Thank you very much for having me, Glenn.
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