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Branko Milanović: Cold War economics was an attempt to deny the existence of social classes

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After the 2008 crisis, studies on income inequality gained momentum. Especially with Thomas Piketty’s Capital in the 21st Century, the concept of inequality, which has become popular both in academia and in the general public, seems to be a consequence of the disappearance of ‘middle class prosperity’ with the financial crisis and the austerity policies that followed.

Branko Milanović, for many years chief economist in the research department of the World Bank, now a research professor at the City University of New York, is known for his research on inequality. In his latest book, Visions of Inequality, Milanović takes the thinking on income inequality of six great economists (François Quesnay, Adam Smith, David Ricardo, Karl Marx, Wilfredo Pareto, Simon Kuznets) and examines how ideas on inequality have changed from the birth of capitalism to the Cold War and the present. Milanović believes that both the disappearance of the Soviet Union and the 2008 crisis have profoundly changed our understanding of inequality.

We talked to Milanović about his latest book, how the Cold War made the views of classical economists, also known as liberals, one-sided, and inequality research after the 2008 crisis.

You do mention in your book the lack of income inequality studies in both socialist and capitalist countries, and you mark this approach as ‘Cold War economics.’ I recently read a book from Samuel Moyne and he also called Cold War liberalism during the Cold War era. And he claims that the liberals themselves cut their past, their progressive past during the Cold War. So how did Adam Smith become a champion of free markets in the 20th century, even if he thought that the state administration is never given to the capitalists due to their narrow interest against the public?

I can split this into two questions. So let me do that chronologically. I’ll start with Adam Smith question and then I’ll talk about the lack of work on inequality studies during what they call the Cold War economics, because to some extent actually one really has to look at it chronologically.

My book, just to mention for those who don’t know, deals with the sort of top most important economists and looks at how they have actually looked at inequality. It starts with François Quesnay before the French Revolution, then goes to Adam Smith, David Ricardo, Karl Marx, Wilfredo Pareto and Simon Kuznets. And then in the last chapter, which covers the period that you actually alluded to, from 1960 to 1990, the book ends at the end of the Cold War.

I think what is quite clear if one reads especially The Wealth of Nations is that it is a book written clearly based on the idea of self-interest, whereas the Theory of Moral Sentiments is based on the idea of empathy. People believe that the Theory of Moral Sentiments is pro-left, in the sense because it’s sort of softer.

But in reality, actually when you read the two of them, it is the opposite. It’s actually The Wealth of Nations is an extremely tough book regarding capitalists. It is a tough book regarding any type of organization. And the government is an organization. So obviously Adam Smith, as we all know because that part of another Smith has been propagated, is very hard on government regulation and on government trying to impose the rules that they themselves, people of the government don’t observe like for example corruption. They could be corrupt themselves, but they impose the rules on others that they should not be corrupt. Then it’s very tough on all as a set of associations, including organized religion. And it’s somewhat tough, but not too much, all labor unions, and I will explain later why not so much. But it’s extremely critical of any organized capitalist associations.

And that part of The Wealth of Nations is hardly ever mentioned because it is not something that the Chicago School and then the Wall Street Journal or others want to hear, but it is extremely tough and the reason is the following: He believes that of course capitalists are few in numbers, so they can coordinate much more easily than workers. Workers, thousands of them, millions, are dispersed.

But capitalists of course, are actually very few in numbers. They can coordinate better and they can have much greater influence on government policy because, as he says, they are sophisticated, and whereas workers of course are less educated, and they don’t have that access to power. So specifically, for example, he mentions that there should not be government facilitation of capitalist meetings. And this is so bizarre when you read that during Davos because it is a total reversal of the situation which existed even like 50 years ago that the government would not ostensibly go and show itself having a meeting of capitalist leaders. You know, the government had in those days to keep itself at least formally separate. But nowadays, as you can see, they actually are keen to go there.

So that’s what Adam Smith views in The Wealth of Nations and I would actually really urge people to read The Wealth of Nations, the entire book. It’s a long book, but it’s not a boring book and doesn’t actually go with interpretation, which is based on really selective excerpts from The Wealth of Nations.

But I think it is an important contribution, I believe, with the book to bring Adam Smith in a more truthful way, not only to go with the selected paragraphs.

Then the second question I will brief on that relates to the absence of the studies during the Cold War economics. Now I have to say something that was very interesting that you mention, is that I came up with the name, you know Cold War economics. I had no idea that Samuel Moyn at the same time totally unrelatedly came up with Cold War liberals. And actually I’ve read and learned about the book and I bought the book only after I finished my book. You know, my book I think was already published and I said wow, this is very interesting that we came up with a fairly similar, you know, title for either liberals or the economist.

For economics, my rationale was the following. To say that was only, neoclassical economics, which it was, is to some extent accurate, but it had something else. That’s something else was really a politically motivated attempt to deny the existence of social class. And that goes back to similar denial which existed in socialist countries, because of course they claim to have eliminated the capitalist class and then to have a classless society.

The US as we know was in an ideological and with other competitions; there was an ideological competition with the Soviet Union and also between capitalist and communist countries. So the US essentially claimed, which doesn’t come strangely because the US always claims to some extent to be classless society. But then the economics or the economists started claiming the same because the point was, ‘OK, neoclassical economics says to us that everybody has some type of assets.’ And then of course as you know they started using subscripts. For us, if there is no more capital and labor, they were all hundreds of assets, and they were subscripted.

And thereby the main dividing line, which is a very strong line because obviously to get income from one asset like capital you don’t need to work and to get income from another asset like you do have to work, this is a very strong line. And on top of that because the influence of the two are not the same politically, was that submerged, erased, ignored. So that’s why I believe to call it only neoclassical economics was not sufficient. We have to really put that prefix of neoclassical and Cold War economics. So that was my rationale for the name.

‘ANYONE WITH COMMON SENSE KNOWS THAT THERE IS A DIFFERENCE BETWEEN BILL GATES AND A BEGGAR’

In your opinion, best income distribution studies combine three elements: narrative, theory, and empirics. Your book follows a chronological order and I cannot but think that economics as a scientific discipline in general, and income distribution studies in particular, went through a regression, after Quesnay, Ricardo, Smith and Marx. For instance, mystification of economics was one of the main boarding points of Pareto, and it seems to me that this was coherent with growing nihilistic tendencies in other areas such as philosophy and sociology. Do you agree with that?

That’s an interesting point. Indeed Pareto is very often criticized because of his theory of the elites. As you said, for nihilistic tendencies and even he’s criticized for being at some point close to an ideological supporter or rather ideological progenitor of fascism.

But I have to say that I’m less critical to some extent ideologically of Pareto then on what happened during Cold War economics. Because for Pareto, inequality still was based on a prior distinction between what you call the elite, which nowadays is basically what we call the top 1%, and everybody else. What neoclassical or Cold War economics did was totally obliterate any difference. So the claim is actually more extravagant in the case of neoclassical economics, the claim is that actually we are all the same. The claim is that Bill Gates or Jeff Bezos or Elon Musk and a beggar are technically the same. They are both individuals who are under the conditions of uncertainty, and given the constraints that they have and the endowment they have, they maximize.

Anybody with common sense would say, well, they are not the same. Not only that, their incomes are different and their wealth is different. Time horizons are different, ability to withstand, lack of income is different, ability to influence political decisions is different, perception of them is different from the people, so everything is different.

And of course Pareto would agree with that because he would place one of them in the elite and the other one into the people.

It is true that Pareto by his writings was like philosophers of his time. And actually I am not that familiar with that. But for example, one can maybe take Nietzsche, as that was in some sense very dismissive of any form of democratic organization, believing that all of them are essentially fake. There he says every elite has to justify through.

There are elites who are like lions who justify the rule by force and there are elites which are more sophisticated; they’re like foxes. They justify the rule through creating an ideology.

So yes, I would agree with you, actually an interesting topic may be to study from a more philosophical angle, because Pareto, similar to Marx, has a political side, philosophical side, historical side and economic side. So you can actually study Pareto from different angles, which I think can also be done on Smith by the way.

What I was trying to say is that Pareto mentions the power of myth. This is like, you alluded to fascism, we have fascism to exploit myths and lies. And Pareto also mentions if you have the power you have even if you know you are lying, you have to lie to balance the society. Also he is always dismissive about the so-called proletarian interests as you mentioned in your book. So Wilfred Pareto is a representative of this regression during the 19th, the second part of the 19th century in western world.

Yeah, I agree with that. As I said, I think actually this is something that should be done by others, not by me because of the philosophical topic.

I of course study Pareto much more as an economist and what he says about income distribution. As you know we’re still using the Pareto coefficient and he was the father of the first power law which we still use.

But it is true you mentioned that his view of the world is very much a reaction against Marx and the large workers movement which in his opinion is actually similar to Schumpeter in that he’s very much against it but he thinks that they would win.

So he sees actually the proletarian movement, well organized with people who are actually willing to sacrifice themselves and he makes the analogy between that movement and Christianity because Christianity won eventually because people were ready to be sent to the lions and to be killed and to actually sacrifice a lot.

He thought that bourgeois liberals were lazy persons.

Yes. Bourgeois liberals want to keep the society as it is, but they’re not going to go out in the street demonstrating and fighting the workers. And he saw workers and of course the organized proletariat which actually comes.

These are interesting links which are not explored in the book, but which also comes with Lenin’s idea that you have to have an organized and professional party which basically dedicates itself to the political movement and taking power.

So Pareto sees all of them as basically much stronger in their beliefs and consequently likely to win, but while accepting that he doesn’t like the fact that they would be. In that sense, he’s similar to Schumpeter. If you read Capitalism, Socialism and Democracy, he saw the power of socialism and Schumpeter was of course always an opponent to socialism. In 1942 he essentially says, I think even in the first sentence of the book, socialism has won.

And of course Pareto also likes to shock very much. Maybe that’s another similarity with nihilistic thinkers of the time and maybe with Nietzsche, is that he definitely likes to shock bourgeoisie by making statements like that, that virtually every society in order to survive has to believe in a in a lie, in a big lie. That obviously included religion there as well. He saw religion is essentially a myth which is being created in order to maintain society.

Can we periodize the income inequality studies of economists you mention according to certain stages of capitalist development? I mean, physiocrats broke with tradition and regarded the wealth of the poor classes as the best indicator of wealth, the focus on class differences marked the classical economics, and with neoclassical and marginal revolution period inter-personal income studies arose.

You have summarized it, but let me just repeat that.

When I was writing the book because the choice of people that I took is basically based on my own writing over 40 years. I didn’t have any doubts except for one person and I’ll come to that in a minute. But as I was writing, I saw very clearly how the focus of inequality and actually I have to say that it is to some extent I am imposing sort of a view in the sense that people like Quesnay or even Smith, they didn’t use the word inequality, but I studied, like implicitly, how they view it, because they talk basically about factorial incomes, meaning, income from wages, labor income from interest and profits from capital and rent from landlord.

But the evolution is as follows. You start with Quesnay before the French Revolution, he introduces the idea of class. The classes are basically like the French classes before the Revolution. They were legal estates. So there were close like classes appropriate there which are composed of the clergy, aristocracy and government officials and they are the ones who received the surplus. So that was a totally new approach as if you see it’s very class based but it’s a legally defined class.

Then, as you mentioned, you have this sort of trilogy or three big authors Smith, Ricardo, and Marx that very clearly follow the definition of class which is based on economic ownership of different assets and of course legal equality, because legally of course capitalists have the same legal rights as workers and landlords.

Then we come to Pareto with this distinction between the elite and everybody else. 

And of course we follow the development of capitalism because what the big three offers are actually at the time of classical capitalism. Pareto is already at the time, as we were saying before, overreaction to that and the sort of more evolved capitalism.

And then we come to Kuznets in the US, where capitalism is sort of ignored this class aspect. He brings in the distinction between agricultural and manufacturing workers and rural and urban areas. So it’s an entirely different distinction.

Then we finally come to no distinction at all. So this is really the evolution. We really go from legally defined classes to economically defined classes, to the elite to the classes defined by essentially the type of work they perform and the place where they perform it.

I think that the last one of the evolution was really politically motivated for the reasons that I mentioned before. But they do correspond to the movement of capitalism.

SAMIR AMIN AND THE CONTRIBUTION OF NEOMARXISTS

I will mention only one person about whom I had doubts. I wanted to include him and I included him a little bit but not as a full profile, he was Samir Amin.

The reason was that neo-Marxists and Samir Amin brought a new look at inequality domestically as being influenced by external forces. And nobody that I mentioned before had this view until neo-Marxist economists because inequality is the result of internal forces.

But then, with Samir Amin, inequality, for example, in Egypt is the result of foreign forces favoring a given type of inequality domestically and that type is then maintained because it is actually good for whatever the capitalist global order. So that was an entirely new view that Samir Amin brought. I was considering having this number seven, but for many reasons, actually I did not. But he’s still in the book.

What can those six economists say about today’s inequality studies? For example, is Adam Smith the moralist, who denounces and reprimands the moral deficiencies of the rich but never questions their right to be on top, or Adam Smith the scientist, who openly criticizes the rich and how they acquire their wealth, suitable for post-neoliberal inequality studies? Recently, I read an article about the resurrection of elites against elites, rich anti-woke figures against rich woke figures in New Yorker (which also mentions your book). Does that mean Pareto is more relevant than the others? Or let’s talk about Kuznets and his thesis about the rapid increase in inequalities with industrialization and today’s ‘re-industrialization’ or ‘green transformation’ debates.

Well, that’s a very good question. I actually think all of them are relevant in some way.

Let me start with Kuznets. When Kuznets defined his famous inverted U-shaped curve, he obviously knew only the situation up to 1955, or actually 1960s, because he still continued writing. But you can apply the same logic of the industrial revolution or technological revolution to the later revolutions, including today’s. You could actually argue that we are now going through the upward cycle of the new Kuznets wave, which is not dissimilar from the upward cycle of the previous Kuznets wave.

But clearly Kuznets, having seen only one revolution, did not expand that to two or three or five. But we have seen two or three. So I think we can use Kuznets to actually claim that similar developments can be seen in the future as well. What I want to say simply is that if you see one phenomenon once, it’s very, very difficult to generalize that. But if you see the same phenomenon twice, from number 2 to number 3 is not a big jump. So I think he’s also relevant.

I believe as you mentioned Pareto as well, because of the book that you alluded to. I think it’s the End Times by Peter Turchin, which actually talks about the conflict of the elites within the elites. Pareto has actually two different elites. Turchin also has two, but it’s a little bit different.

It’s an interesting comparison, but let me go back to Adam Smith because I’m giving the Adam Smith lecture pretty soon and I really would like to emphasize this. Very important points from Adam Smith are: number 1 is that the welfare of the largest group is the objective economic policy and that was new at that time. Secondly, all organized associations have to be looked at with a skeptical eye. And third, capitalists should not rule economic policy because their interests very often go against the public. I think these are really very important messages from The Wealth of Nations.

And when you speak of Adam Smith the Moralist, I really have come to think of all the Theory of Moral Sentiments as a job market paper that Adam Smith did. Because it actually pushes all the right tones for somebody who is a professor of basically jurisprudence and who actually himself is divided on the organized. He’s against organized religion, but his religious feelings can not be fully expressed. As we know, he really remained very ambivalent, at least in public. And so it is a book, a paper that shows him as a theistic philosopher who is actually a moral philosopher, and does all the things that are expected from him to defend in a very sophisticated way. But in The Wealth of Nations, he doesn’t. He’s no longer writing a job market paper. He’s writing really what he believes and what is actually the result of having observed the world for you know, at that time he was more than 50. And so I think it is a very different view of the world.

I would actually really tend to see The Wealth of Nations as a significant, much more superior book to than to the Theory of Moral Sentiments. Because I think just the last point, he was young, rapidly young and he needed to show that he would actually follow the conventions. Young people when they write the job market paper they don’t go into the area which is really going to shock somebody. They used methodology and the topics that are very standard.

‘WITH THE 2008 CRISIS, THE MIDDLE CLASSES REALIZED THEIR ILLUSIONS’

One of the most interesting parts of your book is that when you mention geopolitics of the Cold War era, the turn taken in economics towards obstruction and the funding of research by the rich. It is a little bit surprising when one reads that the idol of liberalism, Adam Smith, thought that the rich people come together from time to time to force their interest over the society. You write that the right-wing financial operatives have established an ‘integrated system of knowledge creation’ during the Cold War. What about now? In ‘Epilogue’, you imply that the rearise of inequality studies is related to the middle classes’ dire situation after the financial crisis. What are real economical and political motives behind this phenomena?

I actually think that the current situation is quite different from this Cold War economics. And I think it’s different for two reasons.

First of all, the end of communism in the Soviet Union. There was no longer the need on the capitalist or the US side to insist so much on the classless aspect of their society because the other side simply disappeared. So that gives you much greater freedom politically to actually go in the directions that politically were difficult before.

Secondly, I think that as always they are important political or economic turning points that make a difference. The 2008 crisis was important for the study of inequality because it brought realization to the mass of people, to the middle class people, that what they believed, increasing standard of living, was to some extent an illusion built particularly in the United States, on the ability to borrow.

As you know, the household loans were actually more than 100% of the GDP and people could borrow very easily. George W. Bush actually started saying that everybody should borrow to have a house. And people who had no jobs or kind of random jobs and no incomes were actually also able to borrow, which of course was also propagated by the rich people and the banking system. Practically everybody participated in that.

As we actually know that quite well, the banks were interested in packaging the loans and getting the fees and the rich people had access to monetary balances which they had to pay somewhere. But then the whole thing crashed in 2008, and it could be much worse, obviously, were it not for the ability of the government to print money and to basically bail the banks out.

But for the middle class, it was a big awakening because the top 1% actually did pretty well. And then came also the issue of China outsourcing of jobs and so forth. So, that economic shock was something that opened the gates to the study of income distribution.

And of course [Thomas] Piketty’s book was a big contributor. But one should not forget this: Like everything, every time in history, a certain ideological trend is successful when it comes on the terrain, which is ready for it.

If Piketty’s book was written in 2005, the terrain was not ready, it would be there and maybe some people would read it, some people would not. But there would be nothing similar to what’s happening in 2013.

And the third one is the ideological, new ideological view of income distribution.

You did your Ph.D. at the University of Belgrade in 1987 on economic inequality in Yugoslavia. According to your own experience, do you think that Marx or Pareto was right regarding socialist countries?

The question is very difficult. To some extent socialist countries did replicate two things that Marx did not believe they would actually have.

The first one, they did create a new, different but new class society where it was not access to capital which mattered because the capital was nationalized, but access to the bureaucratic hierarchy that was to some extent like a new class.

Secondly, but on that I’m less convinced, there was of course income inequality in socialist countries. But it is true that that inequality was less than in the equivalent capitalist countries. So yes, they have reduced inequality, they have not reduced it to a minimum.

But on that part, I think it’s difficult to say, because Marx believed that once the underlying institutions are right, which means the underlying institutions do not have private ownership of capital, that income distribution would become an important topic. But that inherently it could not be high because you don’t have private capital, because everybody has access to schooling, because manual labour would be sort of more valued relative to the intellectual labour. In some sense he was right there.

But I think Pareto was right that there was a new class being created. 

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Interview

Daniel Davis warns US strategy fails against Iranian defense grid

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17/08/2026

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Retired US Army Lieutenant Colonel and military analyst Daniel Davis discussed the US military operation against Iran, decision-making mechanisms in Washington, US-Israel relations, transformations in modern warfare doctrine, and the global balance of power in an interview with Harici Media.

Answering questions of Harici Editor-in-Chief Tunç Akkoç regarding the Iran war, retired Lieutenant Colonel Daniel Davis stated that the US administration lacks an achievable military strategy on the ground. Davis said: “I would say the US has a desire, not a strategy. It wants to subjugate the Iranian side, corner them, seize control of the Strait of Hormuz, prove they pose no threat to anyone in the region, and ensure they never possess nuclear weapons. That is our desire. But there is no strategy to achieve any of these goals.”

Drawing on his past military experience, Davis detailed the geographical and technical challenges on the ground: “As a soldier with direct combat experience, having gained combat experience in some of these mountains between Afghanistan and Pakistan, for example, I know that many of the mountains inside Iran belong to the same mountain category. I knew what a difficult military task it would be to conquer a country as large as most of Western Europe, where such mountain ranges cover the entire western front. Therefore, I knew you could do nothing on the ground. However, I also knew that you could not subjugate a country with this kind of defense capacity and of this nature through air power alone.”

Pointing out that Iran’s defense infrastructure spans many years, Davis continued: “You cannot do this, especially when they have anticipated this for twenty years and made all kinds of preparations by constructing underground caves, production facilities, and storage facilities, and developing production capabilities for their unmanned aerial vehicles and missiles. There is no way you can defeat them. Because such facilities were designed not only to withstand all our strike missiles, such as Tomahawk, Jasmine cruise missiles, PSM, or ATAC, but also to survive. Most are capable of surviving nuclear explosions as well. I have been inside some of these here in the US. I have been in some physically located beneath a mountain. I know they were specifically designed when constructed to withstand the largest nuclear weapons the Soviet Union might possess. The ones there are of the same kind. If you know before embarking on an act of starting a war that the enemy is this large, possesses these types of defenses, and everyone knows these are resistant to our non-nuclear conventional munitions, why would you start a war to force them into something you clearly cannot achieve?”

Addressing the assumptions behind the war decision, Davis said: “I think this is a fantasy stoked by Benjamin Netanyahu. It was said, ‘If we assassinate their leaders, the same thing will happen as happened to Maduro in Venezuela. You went there, captured him, and disabled him; when you did that, you took control of the entire government, they basically handed the country over to you, and the same will happen here.’ Anyone who thinks Venezuela is like Iran has paid attention to nothing. The culture, history, religion, experiences, and everything that has transpired over the last 47 years are radically different from those in Venezuela, and you do not have an insider to facilitate the process as we had in Venezuela. But President Trump appears to have thought this way.”

“When he started the war on February 28, he sealed our fate; we lost this war”

Pointing to inconsistencies in US President Donald Trump’s decisions and the trajectory of the operation, Davis stated: “This situation is proof that he is stuck. Because, in my view, when he started the war on February 28, he sealed our fate. We lost this war. Even if it is ongoing right now, there is no logical way for us to win it. Because we cannot eliminate the trump card held by the Iranian side.”

Stating that military pressure mechanisms are insufficient, Davis explained: “We still have our missiles, aircraft, aircraft carriers, and all such elements. That is why it appears feasible. It is thought, ‘Maybe if we make a good enough deal, or put enough pressure on them, or impose a blockade and leave the public in a dire enough position to change the government’s mind.’ This is a fantasy. This is the only thing President Trump has. Because if he were acting based solely on military reality, strategic reality, and cultural and religious reality, he would know this was an unwise move, but he does not know.”

Describing Trump’s negotiation approach and the breakdown of the reached agreement, Davis used the following expressions: “He is a transactional individual who wants relationships resolved overnight. For example, during the memorandum of understanding period, this duration was to be 60 days. After starting the war, no achievable military objectives remained. Whatever your desires were, you can no longer reach them because you have confronted reality. Now he is trying to find an exit route, but even within this understanding, he cannot arrive at a rational and consistent perspective. Any rational person would think that when the memorandum of understanding was signed on June 17, it provided him with an exit route. You implement the terms of this memorandum, the crisis is resolved, the dual blockade is lifted, and the Strait of Hormuz could reopen.”

Addressing the clauses of the agreement text and subsequent developments, Davis said: “The terms Trump signed stated that Iran had administrative control of the Strait of Hormuz but could not demand any transit fees for 60 days. Iran accepted this, but accepted only one condition: the ‘for 60 days only’ stipulation. Subsequently, they publicly announced that they would collect fees later, but not during these 60 days. The US was not mentioned in the text in any way. We had no say. The authority to decide how operations would run was left to Iran together with Oman. We gave them 30 of the 60 days to prepare their plan for this. But after four or five days passed, the US suddenly declared a new southern corridor together with Oman.”

Detailing the process of reversing the decision, Davis noted: “While a step to reopen the strait had been agreed upon, traffic had risen to approximately one-third of pre-war levels, and many shipments had passed directly on the first day, Trump personally turned back this development toward finding a reasonable exit route from the unfolding disaster. According to reports from some sources in Washington, he came under intense pressure from pro-war figures in his inner circle and those on the Israeli side. He backed down under this pressure and modified the terms by inserting himself into the fifth paragraph. He never made Israel implement the first paragraph, which covered Lebanon and envisioned a ceasefire on all fronts. We did not even give them 30 days; we intervened before five days had passed. Trump has a goal, fails to reach it, puts forward another condition, and then withdraws that as well. He is very easily manipulated; he reaches a decision, then someone speaks with him, and he changes his mind.”

Recalling that a similar situation occurred in relations with Saudi Arabia, Davis said: “He said he made a great deal with Saudi Arabia, and the next day he changed the condition by saying, ‘as long as they sign the Abraham Accords.’ Saudi Arabia, on the other hand, announced that this was not part of the agreement and had never been discussed. This situation shows that President Trump constantly makes concessions when pressured. On this basis, how can any agreement be reached with the US? This situation means that no military or diplomatic exit point remains because he does not permit it.”

“Control is no longer an economic matter; it is a national security imperative”

In response to a question about whether a mutual exit opportunity remains from the current impasse, Davis said: “We had the memorandum of understanding; we had secured this agreement. However, President Trump and his Secretary, Scott Bessent, said, ‘as long as it is a deal we like, we want a new deal.’ You already had a deal; what deal are you talking about now? Why would the Iranian side negotiate a new deal that differs from an agreement made two months ago? This is completely illogical. The Iranian side holds military superiority through its missile cities and half a dozen alternative methods to control the strait. As their official authorities stated on social media, control of the strait is no longer merely an economic matter; it is a national security imperative because it is the only tool with which they can balance their American adversary, who is far stronger militarily.”

Evaluating the impact of the oil crisis, Davis stated: “Strategic Petroleum Reserves are declining. This situation has prevented a crisis so far, but it cannot cover products like jet fuel, diesel, and fertilizer. If it continues this way and the problem is postponed, the reserves will be depleted one day, and economic activity cannot be sustained without oil. Pressure is on President Trump, and the Iranian side is aware of this. They know the blockade will harm them, but they have calculated that they can endure much longer and deeper pain than our side. This is an existential matter; they know that if they surrender their only trump card to an unpredictable president, they will be attacked again later.”

“Reflexive support for Israel in society has been broken”

Touching upon relations between the US and Israel, Davis said a clear divergence has begun in American society. Davis noted: “In the past, across all segments of society and all generations, it was reflexively said, ‘Of course we are pro-Israel, they are our democratic ally.’ This situation continued until the Gaza process following October 7. Israel was attacked on October 7, and no one found it strange that it responded. However, what happened afterward created problems. Israel used this opportunity to destroy the Gaza Strip, increase pressure in the West Bank, bring in new settlers, and discuss annexation.”

Describing the rift between political elites and the public, Davis explained: “There is a major divide in America. Elites are unaffected by genocide or the killing of women and children in the West Bank and Gaza; they close their eyes, arguing that Israel is an ally. However, the eyes of the American public are not closed. They see human suffering on social media and do not carry the memorized assumptions of the past. These elites are not merely bought with money; for decades, they genuinely believed that our interests and Israel’s interests were one and the same. In their minds, saying something negative about Israel is equivalent to saying something negative about the US. Younger generations in particular, and a growing portion of all generations, recognize that our interests are not the same.”

Drawing attention to the cost of the war to the US, Davis noted: “We elected President Trump to apply the America First principle, not Israel first, Britain first, or Germany first. There is anger against those who sacrificed America’s needs by entering the war. According to figures reflected in the public domain, at least 600 Americans were injured; according to what I have heard, this number is over a thousand. Money has been spent, our facilities have been damaged, and our aircraft destroyed; around 40 to 50 of our aircraft were damaged or destroyed. Our bases were ruined and will likely never be rebuilt. We have also lost our geopolitical influence in the region. I doubt that relations with Saudi Arabia, Qatar, the United Arab Emirates, and Kuwait can return to their former state. Because the foundational assumption of this entire structure was that we could protect them; we could not even protect ourselves.”

“We are still living as if it were 1992”

Evaluating the shift in military technology, Davis stated that the US has lost its traditional military superiority. Davis said: “A large number of people in America are still living as if it were 1992. The Soviet Union had just collapsed, China was a peasant army developing militarily and economically, and we held absolute dominance following Operation Desert Storm. We are no longer in 1992. The Russians corrected their mistakes after the initial phase of the Ukraine war in 2022; they became a much stronger land force, missile, and drone force. China, meanwhile, reached immense technological and industrial capacity.”

Explaining the current situation through the example of Iran, Davis said: “We thought we could crush Iran like a fly, but we could not do so due to their missile cities and technologies. If we cannot eliminate Iran, what can we do against China or Russia, which possess power far beyond that? We have fallen behind in categories such as hypersonic missiles and the new Oreshnik missile. When I saw the Bayraktar TB2 vehicles used by the Turks in the 2020 Armenia-Azerbaijan war, as someone with an armored unit background, I understood that the nature of war had changed. The US, meanwhile, talks about producing 300,000 drones by 2030. In an environment where tactics change every six weeks on the Ukrainian and Russian battlefield, our systems remain extremely slow. Ukrainian soldiers mocked the tank platoon manual published last year, saying that with these methods, one could not survive on the battlefield for even ten minutes.”

“The idea of containing China is a fantasy”

Criticizing the US military approach toward China, Davis evaluated: “There is talk of a strategy to militarily contain China. Will you prevent their activities within their own borders, their technological developments, or the expansion of their military? You cannot stop a country with a strong economy and a massive population. We can achieve no result other than entering a war with China in the Asia-Pacific region and losing it. China’s shipbuilding capacity is approximately 200 times ours; they are vastly superior to us in artillery ammunition, aircraft, and missile production. Our methods left over from the Cold War no longer work. What we need to do is keep our own defense strong and ensure deterrence, not spend billions of dollars in the region to establish forward bases that will be hit.”

Touching upon the potential for diplomatic relations between the two countries, Davis said: “I think President Trump personally knows that going to war with China is unwise. However, the Pentagon and the military-industrial complex view China as a constant enemy, demanding more budget, more bases, and more missiles every year. No one considers diplomacy. Yet we can develop peaceful, stable relations with China based on mutual benefit, even if not friendly. Regarding Taiwan as well, I think leaders realize after seeing what occurred in the Middle East and Ukraine that help will not come, and they will adopt a more cooperative stance by withdrawing independence rhetoric. China does not want to start a war; it desires a model similar to Hong Kong. Even if a conflict breaks out in the worst-case scenario, it is between China and Taiwan; the US should not choose to join the war and lose.”

Emphasizing that the arms lobby inside the US maintains its power, Davis stated: “The military-industrial complex remains extremely powerful and holds all levers of power. They maintain control through members of Congress, the media, and public relations networks; I see no sign that this structure is weakening.”

“They did not want someone who would tell the truth about Israel”

Providing information about the process surrounding the cancellation of his appointment within the Office of the Director of National Intelligence, Davis recounted the issue in these words: “When Tulsi Gabbard came to me and asked me to become the number three executive in the Office of the Director of National Intelligence, I said I would be honored to serve my country. However, I stated that I had openly opposed the policies pursued by Israel since October 7 and the war in Gaza and Lebanon, and that these views might not be welcomed within the administration. She thought my accurate past analyses would compensate for this situation. One of my duties was to present the daily intelligence briefing to the president.”

Describing the stage at which his candidacy was withdrawn, Davis said: “Articles against me appeared in the Israeli press and American media. I never hid my views; I said Benjamin Netanyahu’s policies were harming Israel and dragging us down as well. I advocate the ‘America First’ principle, but there are many people within the administration who say ‘Israel First’ and have zero tolerance for any criticism directed at Netanyahu. They did not want someone who would tell the truth regarding Israel. The process expanded following posts by figures like Laura Loomer. On the day I passed the CIA polygraph test and was set to begin duty, Susie Wiles was informed that I had put the president in a difficult position regarding the Russia-Ukraine war. While Trump was saying there would be a ceasefire, I stated on my program that Vladimir Putin would not agree to a ceasefire given his current advantage. Although I stated that I supported a ceasefire, this was made a pretext, and my appointment offer was withdrawn,” completing the interview.

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Interview

Quincy Institute expert says the United States had no plan B

Published

2 weeks ago

on

10/08/2026

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In an interview with Harici Media, Trita Parsi, Executive Vice President of the Quincy Institute for Responsible Statecraft, stated that global unipolarity is coming to an end, transitioning into an increasingly multipolar order.

Parsi addressed shifting global power dynamics, US foreign policy toward China, structural domestic pressures in Washington, and the strategic miscalculations surrounding the ongoing US conflict with Iran.

Parsi noted that while many analysts declare the arrival of a post-American world, the transition will not be an abrupt moment. Instead, he described a phased emergence where it becomes clear that no single superpower possesses deterministic influence over global affairs.

Parsi observed that many governments have been slow to internalize this reality or adjust their policies accordingly, creating the superficial illusion that a unipolar system remains intact. “Whether it’s fully multipolar or other configurations, we can be debated. What I think is clear is that the unipolarity is coming to an end,” Parsi said.

“Unipolarity is an aberration, an abnormality”

Regarding Washington’s readiness for a multipolar world, Parsi asserted that the US political establishment remains unprepared and has historically denied the shift. He recalled that during the first two years of the Biden administration, describing the world as multipolar was dismissed as a Russian propaganda narrative.

However, Parsi highlighted a shift under US Secretary of State Marco Rubio, who stated in a February 2025 interview that unipolarity was an anomaly. Parsi explained, “He actually went further. He said that unipolarity is an aberration, an abnormality, a historical accident. If you believe that it’s a historical accident, if you believe that it’s an abnormality, then I think it comes from that, that any effort to try to restore unipolarity should be rejected.”

Addressing US policy toward China, Parsi noted that despite the summit between US President Donald Trump and Chinese President Xi Jinping in Beijing, there is no structural indication that Washington views Beijing as a potential partner rather than a rival.

He contrasted the Biden administration’s aggressive posture—which assumed an existential struggle for dominance—with the Trump administration’s softer but poorly planned approach.

Parsi argued that neither power can decisively defeat the other, making mutual coexistence and co-governance essential to avoid a catastrophic zero-sum confrontation.

“An effort to indefinitely contain China is a recipe for disaster”

Parsi rejected the feasibility of military containment against Beijing, warning of severe consequences. “I think an effort to indefinitely contain China is a recipe that will bring about great power competition and a confrontation between the US and China that is going to be completely disastrous,” Parsi stated.

He observed that despite significant US strategic errors, such as the conflict with Iran, China has exercised restraint rather than exploiting American vulnerabilities. Parsi argued that if Beijing were dead-set on aggressive power competition, it would have acted differently.

Economically, Parsi argued that containing China through tariffs or Soviet-era containment models is a losing proposition.

Unlike the Soviet Union, which maintained an isolated economic model, China is deeply integrated into global trade and serves as the primary trading partner for most nations, including those in Latin America such as Brazil. Parsi emphasized that economic containment is unviable against a state with such vast global integration.

“This confrontation will be the deadliest conflict in human history”

Evaluating the risk of the “Thucydides Trap,” Parsi criticized the Washington foreign policy establishment for its structural inability to envision peaceful coexistence.

He noted that the political culture in Washington is built around zero-sum competition and conflict rather than diplomatic management.

Parsi emphasized that while historical precedents exist, humanity is not bound to repeat them, particularly when the stakes involve existential risks. Parsi warned that an unmanaged confrontation between the US and China “would be the deadliest conflict in human history if it is allowed to happen,” threatening human survival itself.

Parsi attributed this narrow strategic focus to structural domestic forces, particularly the US military-industrial complex and influential lobbying groups. Working alongside the grand strategy of liberal hegemony, these forces require US military dominance worldwide, especially in Asia.

Parsi explained that institutional inertia makes it extraordinarily difficult for Washington to alter its strategic trajectory.

“The US had an unrealistic plan A and no plan B”

Turning to the conflict with Iran, Parsi asserted that Washington lacks a coherent strategy, having relied on an unrealistic plan that failed within the first three days.

He stated that the US expected a swift regime collapse or surrender within four days, but faced horizontal escalation from Iran, including threats to the Strait of Hormuz and regional strikes.

“The United States had a very unrealistic plan A and no plan B, and it’s been stuck in that situation ever since,” Parsi said, adding that Washington has been improvising and executing tactical operations without strategic success.

Parsi attributed President Trump’s shifting decisions on Iran to this absence of strategy and his personal demand for immediate results. When military action failed to yield swift progress, Trump turned to diplomacy, only to lose patience within three weeks and resume military strikes. Parsi questioned whether the global community could afford a superpower acting in such an erratic manner.

“Without Israel’s push, there would not have been a war with Iran”

Addressing Israel’s role, Parsi stated that Israeli pressure was a decisive factor in driving US policy toward confrontation with Iran.

“Without Israel’s push, there would not have been a war with Iran. Without Trump agreeing to the Israelis, there would not have been a war with Iran. Both of them were needed,” Parsi remarked, noting that Israeli efforts since 1995 elevated Iran into a primary US national security concern disproportionate to actual US interests in the region.

Parsi identified a growing divergence between US and Israeli interests in the Middle East. While the US benefits from reducing its regional military footprint of 50,000 troops, Israel requires continuous US military presence and intervention to maintain a favorable regional balance of power.

Parsi noted that this divergence has created a visible rift between Washington and Tel Aviv following the poor execution of the war and subsequent diplomatic maneuvers.

“Israel’s standing amongst the American public has plummeted”

Parsi highlighted a major shift in American public opinion regarding Israel, noting that sympathy for Palestinians has surpassed sympathy for Israel across almost every demographic category, except Republicans over the age of 65.

He attributed this decline directly to Israel’s military actions in Gaza and its perceived role in drawing the US into a disastrous war with Iran, which mirrored earlier public grievances over the Iraq War.

Regarding a resolution to the conflict, Parsi stated that a dignified exit for both the US and Iran remains possible, though the window is narrowing due to personal hostility and political miscalculations.

Finally, addressing Trump’s political image, Parsi clarified that Trump was never strictly anti-war, but rather anti-risk.

He explained that Trump entered the conflict because Israeli officials convinced him that war with Iran posed little risk and would be concluded within 100 hours. Parsi concluded that had Trump not been misled into believing the operation would be a swift success, he would not have initiated it.

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Why did Trump step back from a decision to launch a new attack on Iran?

Published

2 weeks ago

on

06/08/2026

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Conflicting statements from the US and Iran regarding the potential resumption of diplomatic negotiations have emerged, while ongoing tensions in the Strait of Hormuz have once again brought global energy concerns to the fore.

Addressing these developments on the Harici live broadcast of Strategic Compass, international relations scholar Prof. Dr. Hasan Unal and Alptekin Dursunoglu, journalist, author, and Editor-in-Chief of Yakin Dogu Haber (YDH), evaluated the internal, regional, and strategic dimensions of the conflict. The discussion focused on the shift in Iran’s military doctrine, the political strain within the US administration, the economic vulnerability of Gulf monarchies, and the broader realignments reshaping Middle Eastern geopolitics.

Why did Trump step back from a decision to launch a new attack on Iran?

Opening the discussion, Prof. Dr. Hasan Unal offered a sharp critique of the political rhetoric originating from Washington, contrasting executive declarations with the tactical outcomes on the ground. Unal argued that public statements made by former US President Donald Trump increasingly lack analytical consistency, complicating efforts to decipher official US strategy.

“He has reached a point where he tells more lies than the daily meowing of stray cats,” Unal remarked during the broadcast. “I do not know which part of his statements we ought to analyze, but if we evaluate him within a broader framework, it becomes possible to reach certain conclusions.”

Unal described the military confrontation between Washington and Tehran as an uneven cycle of escalation, noting that US forces continue to suffer casualties and incur immense financial costs without altering the strategic baseline. “The situation has effectively transformed into something like a defeated wrestler who never grows tired of wrestling; America repeatedly approaches and confronts Iran, yet the outcome is obvious from the outset,” Unal stated. He added that American military personnel are being deployed into conflict zones where national interests remain obscure: “I am certain that American soldiers there largely believe they have no personal interests at stake… and that it serves at most the interests of Israel.”

Dursunoglu contextualised the current phase of hostilities as part of an extended campaign, comparing the recent clashes to a second round of a broader regional conflict following earlier engagements in 2025. He noted that despite assertive claims from Washington regarding the destruction of Iranian military infrastructure, operational continuity on the Iranian side forced a shift in US messaging.

Reflecting on official declarations from US Central Command (CENTCOM) and executive statements following intensive strikes, Unal highlighted the internal contradictions in Washington’s narrative: “Trump claimed Iranian naval forces were sent to the bottom of the sea, the air force beyond the atmosphere, and the ground forces deep into the magma. Yet suddenly he declared, ‘I have forgiven Iran,’ while CENTCOM figures suggested they had reached ‘target saturation’—as if there was simply nothing left to hit.”

Is Iran insisting on its conditions regarding the Strait of Hormuz?

A central focus of the analysis was Iran’s response mechanism following the breakdown of initial ceasefire frameworks. Dursunoglu highlighted a significant structural transition in Tehran’s military posture, moving from traditional reactive containment to proactive deterrence across multiple theatres.

Dursunoglu pointed out that during the escalation, Iran did not restrict its target matrix to immediate points of contact. Instead, Iranian forces conducted strikes against US installations and logistical networks across the region, including facilities in Bahrain, Kuwait, Jordan, and Oman.

“Iran’s traditional defence doctrine was defensive and based on proportional retaliation,” Dursunoglu explained. “However, after the US halted strikes, Iran proceeded to target assets in Jordan and Kuwait without immediate prior attacks on those specific vectors. This indicates that Iran has begun executing preemptive strikes, effectively adapting its strategic posture.”

Unal underscored the severity of these strikes on regional logistics, noting that Iranian counter-strikes targeted the port of Aqaba and airport infrastructure in Jordan, alongside American operational facilities in the Gulf. “According to the accounts, Iranian forces began hitting American installations in Gulf states and Jordan within minutes of initial strikes, effectively neutralizing the operational depth the US relied upon,” Unal noted.

The operational status of the Strait of Hormuz remains a decisive point of leverage. Under previous draft frameworks negotiated through Omani mediation, administrative oversight of maritime traffic through the Strait was slated to transition to Iran in coordination with regional littoral states. However, subsequent US efforts to establish an independent naval corridor along the Omani coast triggered a fresh wave of Iranian interdictions.

Dursunoglu outlined the ongoing negotiations surrounding the maritime passage, noting that attempts to bypass Iranian oversight proved unviable for commercial shipping. Under the latest proposals under discussion via Omani channels, incoming maritime traffic into the Gulf would pass through Iranian-designated corridors under Iranian authorization, while outgoing traffic would proceed along Omani coastal waters following notification and approval.

“If an agreement is finalized on these terms, it represents an explicit recognition of Iran’s control over the Strait of Hormuz by the US regime,” Dursunoglu said. He noted that while initial terms provided free passage during a temporary 60-day window, long-term frameworks anticipate structured administrative mechanisms for commercial vessels. Unal added: “Whether designated as transit fees, environmental charges, or security provisions, formalizing maritime oversight secures a permanent structural advantage for Tehran.”

Under what conditions will negotiations begin?

The economic ramifications of maritime disruption have also altered the calculations of Gulf export nations. Following attempts by Saudi Arabia to engage Ansar Allah (Houthi) forces in Yemen, retaliatory actions against critical infrastructure—including the Yanbu crude oil pipeline on the Red Sea—severely constrained alternative export routes.

“By drawing Yemeni forces back into active conflict, Saudi Arabia inadvertently placed its secondary export avenues under direct fire,” Unal observed. “The vulnerability of the Yanbu pipeline demonstrates that reliance on the Gulf cannot be bypassed easily, effectively increasing regional dependence on stability within the Strait.”

Beyond the maritime domain, the broadcast addressed heavy Iranian military engagements in northern Iraq, targeting opposition groups including the Kurdistan Democratic Party of Iran (KDPI), Komala, Pak, and Free Life Party of Kurdistan (PJAK) along the Erbil-Suleimaniyeh axis.

Dursunoglu and Unal noted that cross-border strikes destroyed substantial ammunition depots established near border regions, followed by reported ground operations conducted by specialized Iranian units.

“Iranian special forces executed targeted ground operations across the border,” Dursunoglu stated, pointing to secondary explosions captured in operational footage as evidence of extensive pre-positioned armaments.

Unal noted that these operations underscored the strategic limitations of non-state actors aligned with Washington: “The expectations placed on armed factions in northern Iraq collapsed when confronted with direct military pressure. The narrative that these groups could serve as an internal wedge against Tehran proved to be a costly miscalculation for US planners.”

Reports indicating the start of a repositioning of US personnel and heavy military equipment from bases in Iraq and the Gulf toward Jordan and Israel were identified as a direct consequence of this vulnerability. “US forces are consolidating toward Jordan and Israel because their facilities in Bahrain and Kuwait sustained structural operational damage,” Dursunoglu observed. “When a state can no longer defend its forward command centers—such as the 5th Fleet infrastructure in Bahrain—it is forced to retreat to secondary defensive perimeters.”

How effective is the pressure from Gulf countries for negotiations?

Concluding the evaluation, Unal and Dursunoglu examined the broader diplomatic landscape, focusing on security dialogues among regional powers, including Turkey, Egypt, Saudi Arabia, and Pakistan. Both analysts agreed that any sustainable security architecture in the Middle East must incorporate Iran rather than seek its exclusion.

“How can you construct a new regional order by excluding the very nation that demonstrated the capacity to neutralize external military dominance?” Dursunoglu questioned. “An architecture that relies on Western guarantees or Israeli alignment fails to address the underlying security dynamics of the region.”

Unal reflected on the historical trajectories of Turkish foreign policy, criticizing past ideological approaches that fuelled regional fragmentation and sect-based antagonisms. He noted that realpolitik dictates close functional coordination between Ankara and Tehran despite historical differences.

“Iran’s resistance ultimately prevented the imposition of a security framework dictated entirely by external actors,” Unal concluded. “Responsible analysis requires recognizing that stability in the Middle East cannot be achieved through foreign intervention or regional fragmentation, but through direct, autonomous security coordination among the region’s core nations.”

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