Interview
‘Trump is the the biggest geopolitical risk for 2024’
Timothy Ash, British economist and a senior sovereign strategist at RBC Bluebay Asset Management spoke to Harici. He is optimistic about the return of Turkish economy to macro Orthodoxy, said that, “Western capital will come back into Türkiye. Türkiye’s natural place is within the Western Alliance ultimately.”
Answering the questions of journalist Esra Karahindiba, Ash explains his evaluations and predictions about the future of the Turkish economy and the global economic situation.
‘Return to macro Orthodoxy will continue’
In August, you said that it was too early for Mehmet Şimşek and his team to give confidence to the international markets, pointed to the elections in March 2024, and said that Erdoğan could disrupt low interest-economic growth policies again (‘Ağbal Factor’). Just the opposite happened. As 2023 ends, what would you like to say about the future of the Turkish economy?
We are optimistic. I think institutional investors had an obviously very bad experience with the firing of Naci Ağbal, so they need to see that this team is in place for some time, they have been in place for some time. I’m encouraged actually by some of the changes at the Central Bank. It’s not been simply about Minister Şimşek, Governor Hafize Gaye Erkan been appointed but we’ve seen them been able to fill out key roles with very good people. Cevdet Akçay at the Central Bank Deputy Governor is very well known. Also, Hatice Karahan is again very well and very respected economist. So, we’re encouraged that Mehmet Şimşek has been given a very strong mandate. So, I am optimistic that actually we won’t really see much policy moderation around the local elections and I think this return to macro Orthodoxy will continue. We’re optimistic about next year. We are invested in Turkish credit. So, Euro bonds of companies and banks… The question is whether we invest in Lira assets. That’s a different issue. It’s not only the durability of the Orthodox policy in the team, but it’s also are you getting paid enough in terms of Turk government bonds. They pay 20 per cent. Is that enough to offset for inflation? That’s the institutional investors are asking that question now.
‘The market trusts Mehmet Şimşek’
Some of the Turkish economists say that high interest rates are not enough to recover Turkish economy. Do you agree or not?
It’s about credibility also. Mehmet Şimşek has credibility. The market trusts him. His team again very well respected. It’s about higher rates. It’s about macro-financial policy as well. Şimşek has spoken about a new customs arrangement perhaps with the European Union. That sends good confidence about Türkiye’s future orientation. So, things are looking good actually. We’re in a far better place than we imagined perhaps back last May or June. I think, now, next year 2024 should be a much better year for Türkiye.
‘The Gulf wants to see good macro policy in Türkiye’
One of the promises of Şimşek, Central Bank Governor Erkan and their team was to attract Gulf investments to Türkiye. As we approach the end of 2023, it appears that Türkiye has not yet been able to attract the expected investments from the Gulf. Is this situation related to Türkiye, or is there a general decline in foreign direct investments globally?
We have seen a really interesting change in Gulf investments globally. In the old years Saudis used to write big checks for friends to support friendly regimes around the world. Now, they want to be paid back their money. They want good investments. So, whether you see that with Saudi lending to Egypt or Pakistan, they want specific projects, they want good macro-policy and ultimately they want to be paid back. I mean it’s not charity. They want to see good macro policy in Türkiye. Şimşek is rolling that out. Türkiye has lots of interesting projects, I think potentially lots of interesting business opportunities. So, I think this long-term investment from the Gulf will come because I think ultimately Türkiye has lot of positives in terms of its things that attract investors to. I think the Gulf money will ultimately come. Yes. As long as Şimşek is allowed to continue with his very good policy changes that he’s rolling out.
But we don’t have the timeline.
I think certainly within the next year obviously there was this $51 billion agreement with UAE. That’s a lot of money. I’d imagine that that money will be invested over the medium to longer term, so, over a 5-year time horizon. I’m sure we will get some in the next year or so. Projects take time to be worked up. Also, I guess Türkiye has to prove itself also to those countries. If maybe the UEA wrote a check for 51 billion and gave it to Türkiye the without conditionality, I mean maybe there’d be some concern that there’d be scope for Türkiye to go back on the policy changes we’ve seen. They’re not stupid. The rulers of the Gulf regimes are very logical, practical. It’s their money, they’ve earned it. They want to get it paid back with a return. They want to make sure they’re investing in the right place with the right policies. So, you can understand their caution and their dispersing the money over maybe an extended period of time.
‘For China the key relationship is with the US’
Are we in a period where economies are determined by geopolitical tensions? The Ukraine war turned Europe’s energy policies upside down; US-China tensions are remaking development cooperation in Africa, Latin America and Asia. In this case, how do you foresee the economic indicators of a western Türkiye in cooperation with Eurasia for the coming years?
Geopolitics are a complication. It makes understanding the world more difficult. Geopolitical tensions usually happen, they’re usually unexpected, happen from nowhere like the Gaza, the Gaza Crisis. But actually, some things are encouraging in my mind. One is China relations are actually looking in a better place after the San Francisco Summit. There’s a lot of talk about the demise of the dollar. I don’t think that’s the case. If you look at the success of sanctions and the fact that the Western Alliance was unified in application of sanctions on Russia and that few countries are willing to go against sanctions, suggest that the US dollar is still strong. The way China played the crisis in Ukraine, China was very careful not to go out of its way to support Russia. The fact that Russia has been going to North Korea and Iran to find get munitions and military supplies. It means that China is not doing it. I think for China the key relationship is with the US. The US is still the biggest global economy. China has its own economic problems. This idea that ultimately China will get economic hegemony, will be the number one global economy, I don’t think that’s that certain anymore. The Chinese leadership have made mistakes over real estate, over the health sector, over Covid. They’re fallible like us. The US economy has been incredibly resilient. People have been expecting a recession. It doesn’t look like it’s going to be happening. It makes nice sound bites to talk about a new multi-polar world where the US is not this economic powerhouse. It is. And it’s still going to be the dominant global economic player for the next decade, I would say.
‘Western capital will come back into Türkiye’
There are some pools of business and capital like the Middle East, like China etc. But ultimately what we have learned from the last 5 years, 10 years of trade wars, of protectionism, of geopolitical sanctions; the US is still in a very strong position. Whether that lasts when after the next US elections is open to question. But two-third of investment trade and financing comes to Türkiye from the west, from Europe, from the US. Türkiye has most of its businesses with western countries, most of its financing. I think it’s good that Türkiye is going back to some kind of Orthodox policies. Western Capital will come back into Türkiye. Türkiye’s natural place is within the Western Alliance ultimately. Yes, it can diversify its trade and reduce its vulnerabilities by having lots of trade with Africa, with the Middle East etc. That’s good. Why not? But ultimately most of the money, most of the financing comes from the West. That’s the reality. You mentioned the Gulf money has been slow to come. With the right policies, institutional money will come very quickly back to Türkiye. If we see inflation back in single digits, with policy rates going lower, you could see $20 billion of institutional money from the West coming back into Türkiye. That’s possible. Türkiye was getting that. Look at 2007, 2008, 2009, 2010, 2011; the golden years of AKP rule in Türkiye. I think that’s absolutely possible.
‘The dollar is still king’
Going back to that you just mentioned about de-dollarization; that’s a big question. It is being discussed in Asian world and in China, in Russia, even certain Arab countries who sell their oil only with their own national currency. What do you think about the de-dollarization discussions? Do you think it can come up to happen one day?
The dollar is still king. I don’t think people particularly would like one in your pocket rather than a dollar. I mean in the end it’s trusting the institutions. In the end, international players trust western institutions. They trust the dollar. They trust the FED. They trust the European Central Bank. That’s the reality. I don’t think they particularly trust emerging market currencies that much. And China has still an emerging market currency. I think we’re a long way from having real rivals to the dollar and the euro.
‘The intention is not to crash Russia’
Let’s also talk about the sanctions that was one of the things you mentioned but at the end of the day when you go to Russia, you look at Russian economy’s numbers, yes, there are sanctions. They’re out of the international banking system and etc. They cannot export certain things but you see that Western sanctions could not harm Russian economy as much as they wanted to succeed. Why is that?
Well, sanctions are a complicated business. When you impose sanctions, you want to hurt the country, you’re sanctioning more than you. We’re in a global economy. Russia is integrated into global markets. The West was very careful not to be overly disruptive to global markets. So, the intention is not to crash Russia, not to crash the Russian economy that has global impact. So, you got to be very careful how you roll these things out. I ultimately think sanctions are weakening Russia. You’ve seen capital flights. You have seen human brain drain out of Russia. Russia has lost about 300 billion of its foreign exchange reserves. The ruble has weakened. Türkiye should know this; a currency weakens because ultimately your balance of payments is not sustainable. The ruble has gone from 50 to 100, it suggests to me that actually it’s Russia’s not winning. I mean strong countries have strong currencies. The ruble is not strong. Also, the fact that Russia is spending so much time lobbying gang sanctions suggest it’s not working. Sanctioned countries like Iran, Iraq, North Korea, Venezuela, Cuba… They survive. I mean countries’ economies don’t stop. They learn how to work around sanctions. And sanctions are a constant iteration. The target constantly does things to try and get around them. You have to tighten them. This is what it is. But ultimately is Russia a good place to do business? Is Russia a place that international business wants to invest in? No. What does that mean? Ultimately lower longer-term growth and decline. Russia will not be able to regenerate its military machine as quickly as he wants to, because of Western sanctions. So, sanctions are not a silver bullet. They are one tool in the Western’s armory. We have an interest in the west I think in weakening Russia because Russia is a threat it’s invaded Ukraine. It’s been a bad global player, intervention in Syria, intervened in Georgia and plenty of places. We want that to stop. It’s a threat to us. It’s a threat to the western system and western liberal market and democracy. We need to weaken Russia’s military industrial complex so the sanctions have to remain in place. That’s the reality.
What David Cameron said in Washington is actually pointing out the Western countries like Britain and the US becoming crueler than Russia itself because -I’m paraphrasing- he said “we are spending only 10% of our defense budget and we are using the courage and bravery of Ukrainian men and we are harming Russia’s human force and armed force reducing them 50% comparing to prior to pre-war situation.” That was terrifying.
I mean Ukrainians are fighting not because we give them the money or we sanction Russia. They’re fighting to defend their own country. Because Russia has invaded. Russia stole Crimea. Crimea is not Russian. If Ukrainians want, if Ukrainians are happy for Russian dominance and rule, they’ll lay down their arms and not fight. They are fighting so they’re fighting for their own country because Russia’s invaded. That’s the reality. Sure, it’s sad that Western support has not been stronger for Ukraine. I think if we’d have provided weapons earlier, the Ukrainians would have been able to push Russia back sooner. That’s our fault.
‘We need to do more to support the Ukrainians’
But what Cameron says is something else. You’re just using Ukrainians. You’re just letting them to fight and die for the advantage of the US and Britain.
I can’t comment on what he said. I didn’t hear the phrase. But, look, the reality is Ukrainians are dying to defend us. That’s a fact. They they’re fighting to defend themselves, their own country. But Ukraine is the front line for Poland, for the Baltic states, for Western Europe. If Putin wins in Ukraine, he’ll go further. He’ll do more stuff. So, you’re right. I mean, Cameron’s point was that we need to do more to support the Ukrainians because they’re not just defending themselves, they’re defending us. That’s a fact.
He said “this is a great investment” at the end of his sentences.
I would agree with him. It’s the best investment in our defense. Helping the Ukrainians stop the Russians. From a Turkish perspective, is a Russian victory in Ukraine a good thing that Russia captures the whole of Ukraine dominates more of the Black Sea? I don’t think Russia will then stop being an aggressive power in your region around the Black Sea. Putin has proven that he’s not a global player. He doesn’t play by the rules. He wants to expand Russia’s borders. So, I think, the west and Türkiye have an interest in stopping Putin and Ukrainians are helping us do that.
‘US invasion of Iraq was an error’
So, I’m not going to ask you about the US was invading Afghanistan and Iraq and etc. But this is what big global players do to the world.
Well, I didn’t support the US personally. I didn’t support the US invasion of Iraq in 2003. It was counterproductive. That’s my personal view. It was a mistake. Many British people didn’t support it. Many European countries didn’t support it. That was a Tony Blair, George Bush decision. It was an error. Afghanistan… Usama Bin Laden committed a terrorist attack a 9/11 on the US. I think the US had a reason to go into Afghanistan to defeat al-Qaeda in Afghanistan. Correct. Iraq was a totally different story. Now, the West have done many mistakes globally. I said I was critical of US invasion of Iraq in 2003. I disagree with how the west have managed the crisis in Gaza. There should be a ceasefire. There needs to be a political solution. Palestinians have same rights as Israelis. I agree with that. But it doesn’t distract from the fact that Ukraine has been an independent state for 30 years. Russia has invaded Ukraine. It has taken Ukrainian territory that is not Russia’s. It has murdered thousands of civilians as many Palestinians have died in Gaza as well. Remember, Putin did exactly the same in Syria. Russia and Assad, Russian bombs killed many Syrian civilians in Syria. The West’s mistake was that we didn’t do anything about it. Obama’s famous red lines… We should have known, we should have learned already. He did in Grozny in his own country in Chechenia. This is a bad guy. We should recognize that. Finally, the west should wake up to the fact that we need to stop this guy, and Türkiye should too. So, I mean the fact that the West has made mistakes in Iraq and is now making mistakes in Gaza, doesn’t mean that the Ukrainians don’t have a right to defend their own country and that Russia has a right to take Ukraine. So it doesn’t mean that we should stop.
‘Expanding BRICS to include Iran is not a good idea’
Okay. Let’s go back to economics. Can you comment about the BRICS and the global South are they kind of in near future going to be dominating the global economy also because the rise of India, the rise of China… And the US used to have 75% of the world economics but we don’t have that balance anymore. Things are changing. The economy, the global economy is also changing. Can you comment on the role of BRICS and Global south?
Well, BRICS… I mean what has it achieved particularly? I don’t know how long it’s been existed? In 10 years or whatever? Actually, what is it? What is BRICS entity? It’s been expanded. I mean, is expanding BRICS to include Iran a good idea? I don’t particularly think so. India was not particularly happy with some of the countries that were added to the list. You explain to me what BRICS really is. Türkiye is not a member of it. I think we’ve seen global growth. Energy markets have been growing very rapidly. We’ve seen new senses of economic power and diversification. That’s all good. Global diversification is a good idea. Too much power in the US or whatever is a more balanced global story is definitely a good idea. What we’ve learned in recent years has been that China is not doing that well. I mean, it’s making made a bad decision around Covid, bad decisions about real estate now, its growth model is in question. So, I’m not sure… In the end the US economy has proved very durable, say, no recession.
‘The pluses and negatives about the Belt and Road’
Can you comment on One Belt One Road project? China is actually, even though you say that it’s not performing super, by this project it’s causing interdependency in the region. And it’s using this project as a leverage for growing its own economy. This is something positive from Chinese perspective. And can you comment in the long term will this help China’s economy to grow globally?
Well, there have been positives and negatives about “One Belt One Road”. Clearly, it’s given capital to poor countries so they can develop infrastructure. That’s been good. The problem is it’s burdened a lot of the countries with debt. Recently, a lot of the countries that borrowed from China such as Zambia and Sri Lanka have been gone in debt problems. Pakistan is another example. Unfortunately, “the One Belt One Road” model has been lend the country’s money at the price of Chinese market access. I mean that’s the price. The question is whether Chinese goods come in and often destroy a lot of domestic industry. It’s the track record has been that it’s destroyed countries export potential. They have a lot of debt but they can’t pay it back because Chinese goods have come in and made local goods not competitive. Pakistan’s a great example. Pakistan borrowed a lot of money, got some infrastructure, built some stuff, some power generation stuff. But actually, Chinese goods have come and destroyed, say, the Pakistan shoe industry which used to be a big export. And now they can’t compete. So, there are challenges. It’s there the way it’s been done has probably been not the best it can be. China is now having to address the debt problems that it’s created in countries like Zambia and Sri Lanka and possibly Pakistan. I said, the pluses and negatives about it.
‘I am pretty worried about 2050’
Lastly, can you give me your brief foresight about 2050? How do you see global economies picture? Who is going to be where and how?
Wow, 2050. I mean I am pretty worried. I mean, climate change what we seeing the lack of… I’m not particularly an environmental specialist but it must be clear to everyone. Climate change, climate crisis every year is getting more difficult. We have the US presidential elections. Trump is coming in. That’s probably the biggest risk. I did a survey on my Twitter account. It’ the biggest geopolitical risk next year. I think the biggest number was the Trump presidency. What that means? US… You knw, I am British. I’m not a big fan of the US. But is the world… Is an isolationist US that the US that withdraws from international diplomacy a good is that actually a good thing? We can criticize the US in many places like the Middle East in terms of policy probably. But if it steps back, it’s less multilateralism. Climate change needs a multilateral approach. Trump doesn’t believe in any of that. Is that going to be good? Or is the US becoming more protectionist under a Trump presidency? Is that a good thing? I don’t know. So, the world’s looking pretty concerning. I have to say. It’s 2050 is quite a long way away but at the moment with climate change that looks worrying for our children, I think.
Interview
Daniel Davis warns US strategy fails against Iranian defense grid
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.
Interview
Quincy Institute expert says the United States had no plan B
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.
Interview
Why did Trump step back from a decision to launch a new attack on Iran?
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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