Jeffrey Sachs analyzes the US-Iran ceasefire deal and what it reveals about American power
Jeffrey Sachs discusses the newly announced US-Iran agreement with Glenn Diesen, assessing its terms, fragility, and broader geopolitical significance.
Summary
Glenn Diesen interviews Professor Jeffrey Sachs on June 15th, the day a US-Iran ceasefire agreement was announced. Sachs describes the deal as fragile and vague in its details, involving a two-phase framework: reopening the Strait of Hormuz and negotiating the nuclear issue over 60 days. He argues the war accomplished absolutely nothing, was driven by a "Mossad operation" sold to the United States, and that both sides are simply losers. Sachs places the episode in a broader context of American imperial overreach, drawing an extended analogy to the Roman Empire reaching its limits — from the Battle of Teutoburg Forest to Hadrian's consolidation — to argue that the US has now reached its limits in all three major theaters identified by Zbigniew Brzezinski in his 1997 book The Grand Chessboard: Ukraine/Russia, Iran, and China. Sachs details Brzezinski's strategic logic — weakening Russia, surrounding it with NATO, preventing a Russia-China-Iran alignment, and using Ukraine as the geographic pivot of Eurasia — and argues that all of it has now failed, with the unipolar moment definitively over. He calls for economists who believe in open trade and mutual benefit to reclaim economic policy from the "gangster mentality" military strategists who now dominate Washington.
Key Takeaways
FULL TRANSCRIPT
The ceasefire announcement and what is actually known
Glenn Diesen: Welcome back. Today is Monday, June 15th, and we are joined by Professor Jeffrey Sachs to discuss whether peace could break out in Iran. Thank you for coming on. We see that Trump has announced that a deal has been reached. One would like to be optimistic, but how do you see this deal? How sustainable is it? It implies some painful concessions, and I know many people in the US — as well as possibly the majority in Israel — do not want this. If we add to that the fact that the US does not have a great history in terms of implementing these kinds of agreements, especially with Iran, how do you justify optimism now?
Jeffrey Sachs: We have to be extremely cautious. The details of what has ostensibly been signed are still unclear. All parties — Iran, the United States, and Pakistani mediators — have said that an agreement has been signed, but we don't know the details. It comes in many stages, and in any event it could fall apart quite easily.
So what do we know? We know that the three sides have said there will be a ceasefire. The two antagonists — the US and Iran — and the third party, the mediator Pakistan. This does not include Israel. Israel is not a formal party to this agreement, as far as we know.
The agreement seems to call for an end of hostilities. The phrase the Pakistani announcement used was "a permanent end to hostilities." It ostensibly comes in two broad phases. One is to reopen the Strait of Hormuz and restore international oil and gas traffic. The second phase is about the nuclear issues. According to the announcements, the agreement does not include other kinds of demands that the United States had once put on the table — about Iran's missile systems or its support for other groups in the region such as Hezbollah. So it seems to be a two-stage agreement: one to open the Strait of Hormuz, and second to then negotiate over a period of 60 days some kind of resolution on the nuclear issue, in which Iran would in some sense irrevocably not produce or procure through purchase or other means a nuclear weapon, and US and other international economic sanctions would be dropped.
That's the basic framework. Within that there are many statements but not so much clarity. How will the Strait of Hormuz be governed going forward? It seems from the Iranian side that Iran says this is not an international waterway — it's a waterway shared by Iran and Oman, and they will have co-responsibility for it. Whether that is somehow inscribed in the agreement or not, we don't know. President Trump said there would be no tolls charged, and this may be one of the terms of the agreement, because Iran was claiming tolls of $1 a barrel of oil on ships passing through, and maybe that has been dropped. On the other side, there are statements that the US will unfreeze Iranian assets that are frozen — a number mentioned is $25 billion. Which assets? Why? How? Under what authority did the US freeze these? What is really being counted here is not clear. But there seems to be some kind of arrangement where the physical traffic will open, some kind of nominal — or maybe even more substantial — Iranian and Omani control over the strait will continue, and if the rumors are correct, tolls will not be charged on the trafficking of oil and gas. On the other side, the US will unfreeze a significant amount of assets that were frozen beforehand.
Now, Israel is not part of this agreement, and certainly the Netanyahu government would not agree to one of the crucial terms that's claimed — that it covers a cessation of fighting in Lebanon. Exactly what has been agreed regarding Lebanon is also unclear. But if the past is in any way predictive — and of course it should be — Israel may try to undermine or destroy the agreement by continuing the bombing in Lebanon, or finding a pretext, or claiming that Hezbollah shot a drone or a missile into Israel and now the bombing of Beirut will continue.
All of this is to say that this is extremely fragile. It essentially, at the core, from what we can gather, returns the situation more or less to where things stood before the February 28th attack by Israel and the United States on Iran, with some significant changes — perhaps on formal control of the straits, perhaps with some unfreezing of Iranian assets, or perhaps not. Sorry to be so vague, but our main media don't even pretend to tell us what's in the agreement. We have some limited reports from the Iranian media, but other than that, lots of details remain vague.
The war accomplished nothing
Jeffrey Sachs: I think there's one overriding truth that we can say even at this stage: this war accomplished absolutely nothing. It was useless. It was stupid. It was principally a Mossad operation sold to the United States. It killed a lot of people. It created a lot of harm. It is the result of essentially irresponsible people being in charge in Israel and in the United States. Nothing good came out of this — not an iota of substantive achievement of any value for the US.
It weakened Israel, to be sure, diplomatically. How many times now has Trump himself called Netanyahu crazy, in expletive-filled terms, including again yesterday? Israel's image in the world, rightfully so, is in a catastrophic condition, because Israel is truly a rogue state — a murder state incorporated. It's a disgrace how it behaves. So Israel is the clear loser.
The United States has certainly lost any aura of strength and invincibility in all of this. I wouldn't say Iran is the winner, though. It's battered. It has suffered thousands of deaths and tens of billions of dollars of damage. Wars can produce only losers, and this is what this war did. This was a lose-lose war, stupidly launched by Israel and the United States. It accomplished absolutely nothing.
Whether it's over, of course, remains to be seen. This is hardly a "new day in the Middle East breaking out," as Trump's sycophants have said. But maybe it is a fragile ceasefire that will hold. My inbox is already filled with people saying it will fall to pieces within 48 hours — that it's a pretext, it's a ruse. I would not myself go that far. Both sides — Iran and the United States — have good reason for the fighting to stop. And so maybe the fighting will stop.
Israel never seems to stop fighting. But Israel is in a state of open collapse in terms of the support it has in the United States and the rest of the world. So maybe this time Israel won't defeat the peace, because maybe what Trump is very visibly saying in public — that Netanyahu is, to quote the president of the United States directly, a "fucking crazy bastard" — maybe that actually reflects the fact that with American politics the way it is, with an upcoming election, and with Trump's approval ratings in a steep descent, there isn't a mood for Israel to play its typical disastrous games.
The politics of painful concessions
Glenn Diesen: You mentioned this vagueness in terms of what the deal would entail. I think that's almost required now, because there are a lot of painful concessions. For example, on the Strait of Hormuz — they say yes, there won't be a toll, but a toll suggests it's merely a cost for entry. There will be a fee, which would suggest operational support — navigation assistance, rescue operations, environmental protection, security issues. There is a legal distinction between a toll and a fee, but at the end of the day the fee did not exist before this war and it will exist after. So for Trump, given the way he has talked about this war and the outcome over the past few months, it will be a concession, it will be a loss. It's going to be hard. He will meet a lot of opposition once the details start to come out. It would be a minefield.
Jeffrey Sachs: Yes, and two kinds of opposition. Of course we have the Zionist lobby, which will openly attack the deal as a concession to the evil regime. And there will be — eventually, if our media ever get around to it, and if there are at least a few politicians who are not pathetic in our country — questioning of what the hell just happened. Why did we do this? What kind of absurd war was this, launched singlehandedly by the president of the United States without any public backing, without any congressional backing, without any clear explanation, with statements at the beginning that the goal was regime change and unconditional surrender? None of those goals were achieved. So there deserves to be, and will be, criticism. But we certainly are not at the end of the Zionist lobby in the United States either.
The absence of strategic thinking and the gangster mentality
Glenn Diesen: People always get lured into these wars because of the way political discourse works now. When they attacked Iran, the logic was essentially: if you support it, you're pro-Israel; if you don't support it, you're pro-Iran. No one began with the point of departure of what should we achieve and how can it be achieved — an actual strategy. We do the same with the war against Russia. The language is: your position on the conflict signifies whether you're pro-Russian or pro-NATO. But at the end of the day, it doesn't mean anything what your position is if you can't achieve your objectives. It's very hard to explain why this was a pro-American or pro-Israeli war to begin with. It didn't serve their interests.
Jeffrey Sachs: I think a couple more things I would add. First, there are no operative norms against war in the US executive branch, and certainly not in Trump's mind. The idea that you bomb places, kill people, assassinate people — this is a norm. There's no sense in which any single American official would say, "But the UN Charter doesn't allow that." That statement doesn't exist. We are led by gangsters, with a gangster mentality: do what you can, get away with what you can, anyone else is a sucker, don't be stupid, there's no international law. So first, there are no norms against this — no moral compunction, no legal compunction, no need to justify anything other than victory itself.
Then comes the very pragmatic question: will this succeed? I think it's probably the case that Trump was on a delusional high from Venezuela, in which some kind of inside operation between the CIA and the Venezuelan government agreed to the forcible removal of the president of that country. It left a regime intact but changed the government and changed politics, because it was the cover for the US to remove sanctions that had been put on Venezuela beforehand and start shipping Venezuelan oil to the United States. The Venezuelans were in rather desperate need of cash and so they went along with it as well.
I think the Iranian gambit was not aiming to be a war. It was aiming to be a one-day operation. Everything we know about it tells us that story — there was a plan to install a leader. Trump said as much: kill the leadership, decapitation, and everything will be all right the next day. So this is also the behavior of very naive, very arrogant people.
It does show, to my mind, a complete breakdown of politics in the United States. Our institutions don't work. We don't have institutional review. We don't have a functioning National Security Council or national security apparatus. We certainly don't have a republic in the sense of a constitutional order in which Congress would either declare war or have oversight over the actions of the executive branch, or control through the budget. We have none of that. We have a small, gangster-mentality group running things right now.
It didn't work for them. They face some constraints as a result of the failure of this one-day operation. This is essentially trying to find a way out. It's not a surrender, it's not a victory. It shows how entirely useless all of this gangsterism was, and how much it hurts everyone else — us, and especially the Iranian people. The 160 schoolgirls killed on the first day of the strike in Minab — it's been a disaster for everybody.
The one place where it has not been a disaster is in big tech, which has tried out its weapons, gotten expanded Pentagon contracts for AI systems, made a few mistakes like the mass murder of schoolgirls — but that's all in the machine learning process, apparently. Palantir has won. The Israeli stock market has won. The warmongers came out ahead. The world suffered much larger losses from a military, strategic, and foreign policy point of view. This was not only useless — it was a loss. The United States lost any claim to protect countries in the Middle East, to have military dominance, or to have any kind of hegemonic control.
One more point I would add, just in these early hours of trying to assess this: the Iranians were hurting badly economically. The blockade did hurt them, but more than that, the US has been on an economic war against Iran for years. Our Treasury Secretary Scott Bessant is also very much of a gangster mentality and talked about how "economic statecraft" had crushed the Iranian economy. I think the Iranians wanted some kind of deal to release some of the assets — which is interesting, because what was being released was assets illegally taken by the United States in the first place, but the US was using that as bargaining leverage.
This does show that while US military might does not have the strategic leverage — neither in Ukraine, nor in Iran, and certainly not in East Asia — the US chokehold on international transactions remains not insignificant. It's a real puzzle to me why the BRICS nations have not by this point made a full workaround from US unilateral economic warfare, because it's illegal and it can be circumvented. But so far the US continues to deploy its economic warfare with some effect in Venezuela and in Iran.
Is this a turning point in American grand strategy?
Glenn Diesen: You mentioned that your inbox was full of people warning that this is a temporary de-escalation, and I think that's fair. But what you said now — do you think this could be a turning point, not just in the US Middle East strategy but overall? Not because of a moment of moral clarity, but because of the recognition that the distribution of power has shifted — that if you try to do everything and you end up being punished, at some point you have to change course. The same applies to the US-Israel tensions. Some argue it's theater, but I have a hard time seeing it as pure theater given how it's treated in the Israeli media and how it's fueling dissent in the US. And it could be extended to the war against Russia. If a war isn't successful, usually Washington can at least lean back and argue, "Well, at least we weakened our adversary." But at the end of this, it looks strategically as though not just Iran but Russia will come out on top, and NATO and the US will come out in a much weaker position. This is not how these wars were supposed to work. Do you think it's possible that this war could compel the US to fundamentally change its strategy — given that its bases have been harmed, its alliances have been harmed, and at some point it must adjust to the reality of what can actually be achieved?
Jeffrey Sachs: I think yes, at a fundamental level the world is changing and the sense of US power is changing in a definitive way. The US remains a powerful country, but after 1991 it claimed the mantle of global hegemon. It claimed to be the unipolar power of the world. It claimed a writ over the entire world, and this was spelled out most clearly by Zbigniew Brzezinski in 1997 in The Grand Chessboard, whose subtitle was essentially about preserving American primacy. The idea of that book — very influential, and more importantly reflecting the mindset in Washington — was that the United States needs control over Eurasia to ensure control over the world. The way to keep control over Eurasia was essentially to weaken Russia, surround Russia with NATO, prevent any kind of alliance between Russia, China, and Iran, play the different states off against each other, and by taking Ukraine essentially secure the geographic pivot for all of Eurasia, because Russia would be weakened and would have no alternative but to turn to the US and the West.
In that book, Brzezinski says this is the way the world will go — the US will remain the hegemon because of its technological and economic dominance. And that fundamentally is over. The rise of China itself changed that. Geopolitically, Iran, China, and Russia are aligned in a way that Brzezinski said could never happen. Militarily, the US is at a stalemate. It cannot impose its will militarily on Russia. It could not even impose its will militarily on Iran — that's one of the clear lessons of this. There's not a chance in the world it could impose its will militarily on China.
I think maybe the United States has recognized that in all three theaters. In Ukraine, it's washing its hands of the war. On China, Trump rather openly said vis-à-vis Taiwan, "We don't want a war. We don't want you to declare independence, and we're holding our weapon sales to Taiwan in abeyance." This was basically what he said as he left Beijing from the summit last year — that we can't impose our will on China.
So in a sense, what is being seen is that the US does not have hegemonic control over the vast realm of Asia and the non-EU part of Eurasia. It still has influence, it still has the ability to impose pain and sanctions, but it cannot impose military victory. And I think increasingly its ability to impose economic compulsion is fading away, though I would say it played some role in what we've seen now vis-à-vis Iran.
If I could put it in ancient terms: the Roman Empire was an expansionist empire through Augustus and through the first century AD, and then it reached its limits. It reached its limits in Germania early on, in the Battle of Teutoburg Forest — I believe that's 9 AD. After that the Romans said, "We're not going to fight in Germania. We're going to hold a line." Then by the time Hadrian became emperor — I think it's 117 AD — he said, "We've reached the limits of the empire. We will live in peace, or maybe we'll battle on our borders a bit, skirmishing, but we're not going to expand." If I could make a crude analogy, maybe in Washington they'll learn: stop. You cannot control, divide, weaken, or defeat Russia. You can't control the Middle East hegemonically. Certainly not West Asia with Persia — today's Iran. And certainly not China.
This doesn't mean that games won't continue. Economic statecraft, as Bessant calls it — using ugly and illegal tools — will continue. But I think you're right that essentially in the three main theaters that Brzezinski himself talked about — US and Russia, US and Iran, and US and China — the limits have been reached. People should view the experience of the Ukraine war, this stupid useless war with Iran, and the failed trade war with China as all showing that America is certainly not the unipolar power. It does not have its writ over the world from maybe 40 degrees east longitude to the Pacific.
Maybe it will learn some lessons and stop being so gangsterish, because basically the US has used gangsterism to try to extend, prolong, and enhance its power. But gangsterism wears very thin. There's no cooperation, no trust, no respect, no real power from it — only tactics and maneuver. And I think the US has been exposed in that way.
Again, the US is still powerful and very nasty in our own hemisphere. Events today could be followed by an invasion of Cuba at any moment. We could see more terrible things. The US has not turned into some kind of beneficent, international-law-abiding state. It remains an ornery, nasty, gangsterish empire in the Washington mentality. But limits are being understood more than before, even if they are not openly acknowledged — and certainly they are very much disliked.
The end of Western technological dominance
Glenn Diesen: On the unipolar moment — I think the key criticism in the 1990s was that the unipolar moment would unavoidably be temporary, because the US would exhaust itself and it would incentivize adversaries to collectively balance against it. The war against Russia pushed Russia closer to China. The war against Iran pushed Iran even closer to Russia and China. So at some point the lesson has to be learned that hegemonic peace does not reflect reality, and when policies do not reflect reality, it has very unfortunate consequences.
Jeffrey Sachs: Exactly. And I think there are two things people should keep in mind. One is that you get balancing — you push so hard on adversaries that they join forces together, and you turn out not to be as powerful as you thought. The second is the myth of US technological dominance. This is still a continuing myth, certainly in the US stock market. But the idea that ultimately Western technology is superior and other countries will have to face that fact — either on the battlefield or in the economy — is in truth a core reason for the failure of the unipolar moment.
China absolutely competes, and in many ways out-competes, the United States technologically across a very wide range of activities. But it's more than that. Look at Iran. This is a sophisticated country that can make sophisticated weaponry, and that was completely not understood or felt in Washington. Same with Russia. Technology has spread — advanced weaponry, digital technologies, AI. These are not the preserve of Elon Musk, or Palantir, or Israel, or the United States. These are worldwide technologies, and they have spread to many power centers. There are a lot of smart people in a lot of places.
The idea that the ultimate control of the Western hegemon is its technological superiority needs to be put aside. And if it were put aside, there would not only be peace and mutual respect, but a lot more economic gain as well. Because one of the things I completely reject — and I would laugh at it if I didn't find it so tragic — is that the global economy has been taken over by military strategists who now view trade and finance as strategic weapons rather than as the means of mutual gain and economic progress. I want the economists who believe in open trade, finance, and mutual benefit to reclaim these tools from the economic warriors — our Treasury Secretary, our Commerce Secretary, our trade representatives — who view everything about the economy in warfare terms.
Glenn Diesen: Thank you for taking the time. If I can just add one note — I think what you said about technology is quite important, because it shows that these wars don't just signify the end of the post-Cold War hegemonic era, but also centuries of Western technological dominance, and well, at least international leadership over the past 500 years since the Western maritime powers set out to reconnect the world. So it's interesting times. Thank you very much again.
Jeffrey Sachs: Of course. See you again very soon. Thanks a lot.