Economy and War

Update April 13

After five weeks of the United States and Israel bombing Iran, as its neighboring oil monarchies collaborated in the attacks, it became clear from the viewpoint of the Trump administration that the war wasn’t going anywhere. There was talk that the U.S. might seize one or more Iranian islands, though even if successful, this would have achieved little. A full-scale invasion of Iran, meaning a march on Tehran, is out of the question at the current time.

Iran is a country of around 93 million people. This is larger than the German population of 80 million at the time of the U.S. invasion of Western Europe and Germany in 1944-1945. In geographical size, Iran is about the size of Western Europe. And of course, there is no equivalent to the armed forces of the Soviet Union attacking from the other side. This means that a “march on Tehran” like the march on Baghdad in 2003 is ruled out. If attempted, this would be the largest foreign military operation by the U.S. since 1945 and possibly larger. This would require, at the least, a full-scale mobilization with a renewed military draft.

In 1944-45, the U.S. enjoyed the support of most of the non-German Western European population, who did not want to be ruled by Nazi Germany. This certainly would not be the case in any attempted “march on Tehran” today. There are other differences as well, that are not in the U.S.’s favor. In 1944-45, U.S. industry was, relative to that of other countries, at its historic peak. Today, the U.S. lags far behind China. The effects of the long-term decline are being felt as the U.S. and its extension, the Zionist entity, are running low on munitions. Unlike before, when the U.S. dollar was rock solid, the dollar has been plunging against gold. The dollar price of gold was above $5,000 per ounce when the war began on February 28, and the Trump administration was forced to accept a two-week ceasefire on April 8. Talks to find a permanent end to the war began in Pakistan on April 11 and collapsed the next day when the U.S. insisted that Iran give up its entire nuclear power industry.

The U.S. then announced it was blockading all trade through the Strait of Hormuz, effective April 13. This is an Act of War by the United States against the Islamic Republic of Iran. Whether this will lead to a resumption of large-scale military action and what form it may take is unknown as of the time of this writing on April 13, 8:36 a.m., Pacific time. It appears that the Trump administration is hoping that by preventing Iran from selling oil on the world market, it will be forced to surrender to U.S. demands.

The Reichsbank in 1939 and the Federal Reserve in 2026

In January 2026, the Trump administration launched additional attacks on the Federal Reserve System’s independence. This caused the gold market to go into a frenzy, with the dollar gold price spiking to over $5,500 an ounce. The price then plunged back below $5,000 after Trump announced the nomination of veteran central banker and Wall Street favorite Kevin Warsh to head the Fed after chair Jay Powell’s term ends in May. As of early February, the price has fluctuated around $5,000. While this may seem obscure to laypeople, it points to the economic roots of crises that have erupted on many fronts.

We’ll begin with Iran, then turn to the general strike in Minnesota on January 23.

From Caracas to Minneapolis

The Donald Trump administration celebrated the birthday of what those in the Christian faith call the Prince of Peace, Jesus Christ, on December 25 by bombing two African countries, Nigeria and Somalia. That Christmas day horror was only the beginning of its crimes as 2025 ended. As 2026 began, on January 3, the U.S. bombed Caracas, the first time in history a South American country was subjected to air bombardment, and kidnapped Venezuelan president, Nicholas Maduro, and his wife Cilia Adela Flores. In a world of nation-states, the government of one country has no right to seize the citizens (let alone the head of state) of any other nation-state.

On January 7 in Minneapolis, an ICE agent shot and killed 37-year-old Renee Nicole Good, a native-born U.S. citizen who was a poet, a Christian, white, and a mother of three now-orphaned children. While the administration attempted to frame Ms. Good as a “domestic terrorist” who was attempting to run over the agent, Jonathan Ross, bystander videos show she was actually trying to avoid him while he circled her car with a cell phone in one hand and his service weapon in the other.

This horror followed weeks of a coordinated racist drive against the Somali community, which serves as a textbook example of economic scapegoating. Reactionary demagogues first claimed Somali immigrants had been capturing and eating domestic pets; more recently, they have weaponized allegations of “daycare fraud” to charge that Somali businesspeople are funneling federal dollars to international terrorist groups. By criminalizing the Somali community’s economic activity, the federal government has created the pretext for a permanent federal occupation of the city.

More than 2,000 ICE agents have flooded Minneapolis, and Trump wants to send more. This massive deployment represents a domestic application of the “Department of War” philosophy, turning a major U.S. city into a garrisoned territory.

Palestine

On October 9, a new ceasefire in Gaza was announced. The last one took effect in January 2025 as Donald Trump assumed office. Many hoped this was the end of the Gaza genocide.

In March, the genocide resumed as Trump and Zionist entity leaders made clear their aims included the complete removal of the Palestinian population from Gaza. Kept open was whether this process was through ethnic cleansing or physical annihilation (literal genocide).

Physical annihilation was achieved by killing through mass bombing, cutting off food and water, causing manufactured famine, and disease.

Marxism versus Individual Terror

On September 10, far-right youth group Turning Point USA leader Charlie Kirk was assassinated by a sniper at Utah Valley University in Orem, Utah. The FBI arrested 22-year-old Tyler Robinson, who turned himself in at the urging of his family. Turning Point USA specializes in organizing far-right youth to support the Republican Party and Donald Trump. Kirk was a thorough-going bigot who specialized in baiting African Americans, Muslims, women’s rights activists, gays, trans people, leftists, progressives and liberals. He also made anti-Semitic remarks that in no way excluded his strong support for Zionism.

Class War at Home, Imperialist War Abroad

Last month, June 2025, saw the twelve-day U.S.-Israeli war against Iran. On July 4, U.S. Independence Day, Donald Trump signed his “Big Beautiful Bill.” The bill means class war at home, and the twelve-day war against Iran points to more imperialist war abroad. This month, we examine the class war at home and the capitalist war economy.

Trump’s Big Beautiful Bill is a massive attack on the working class, science, art, education, and human culture in general. We could write volumes about this wretched thing, but we will zero in on the attack on the working class. The spearhead is the attack on the Medicaid program. To grasp its importance, it helps to understand Marx’s theory of wage labor and surplus value.

Unraveling of the Post-1945 Order

As May winds down, the Gaza genocide continues, as do negotiations to end the Russo-Ukraine war, with no clear end in sight as of this writing. The Republican House of Representatives passed a bill now being considered by the Senate aimed at big cuts in government-supported Medicaid and possible cuts in Medicare and Social Security. The bill also features making earlier Trump-Republican tax cuts permanent, as well as adding more.

Liberals and progressives claim Republicans want to cut Medicaid to finance the tax cuts (capitalists don’t like to pay taxes) — but this is not their main motive.

Cutting Medicaid forces more of the poor onto the labor market by making them financially desperate to find a job or go without medical insurance. Nothing is being done to make more jobs available, nor are there plans to force bosses to provide medical insurance or wages sufficient to afford private insurance. They are intended to force people to work for wages that do not even pay the value of their labor power.

Liberation Day

On April 2, President Trump announced his “Liberation Day” tariffs. As this blog concentrates on economic questions, this was the biggest event of the last month. But before I get to the tariff, I’ll look at other developments.

Kilmar Abrego Garcia lived and worked legally in Maryland since 2019. The Trump administration accused him of belonging to a gang, arrested and put him on a plane heading for a notoriously brutal El Salvadoran prison. He had not been convicted of any crime. They then claimed they’d committed an administrative mistake.

On April 10, the Supreme Court unanimously ordered the return of Kilmar Abrego Garcia. As of this writing (April 28), he remains imprisoned, and Trump has refused to follow the court’s order. [I wonder whether the high court regrets last year’s decision that even after leaving office, a president cannot be criminally prosecuted for any action taken while in office in pursuit of their duties? I don’t know the answer, but it seems the court is like a man sawing off the branch he is sitting on. -SW]

Gaza Genocide Resumes as U.S. Wages War on Yemen

On March 17, the Gaza genocide resumed, first the blockade and then the bombing. It appears we are back where we were under Genocide Joe Biden. Up until then, Trump was better for the Palestinian people in one sense. After his election, negotiations paused the genocide. The pause began on January 19, the day before he became president.

Now the only difference is that, in theory, the Biden administration supported the so-called two-state solution that had been Washington’s official policy since 1993, with the Oslo Accords. The West Bank and the Gaza Strip would form a separate Palestinian state, while the rest of historic Palestine would belong to the Zionist entity, the Jewish State of Israel. Biden insisted that Gaza’s Hamas administration be replaced by the rule of the notorious collaborationist Palestinian Authority, under Mahmoud Abbas, who has acted as a Zionist agent. The Biden administration, like its predecessors, opposed anything like (bourgeois) democratic rule in Gaza.

Though he supported this approach in his first administration, Trump has now junked it. He’s made it clear that all Palestinians will have to leave Gaza, promising they will enjoy a wonderful life somewhere outside Palestine. In addition, the U.S. would own Gaza, transforming it into some kind of hotel casino resort, owned by U.S. capitalists that would include the Trump Organization itself.

Genocide Joe

On Wednesday, Jan. 15, 2025, five days before Donald Trump took office, an agreement was announced for a ceasefire to take effect the following Sunday, Jan. 19. President-elect Trump sent Steve Witoff, like Trump a New York City real estate magnate, to negotiate — or rather, lay down the law — to the Netanyahu regime.

When Israeli leaders protested that it was Saturday, the Jewish Sabbath, Witoff, who is Jewish, swept these pious objections aside. He said that the Netanyahu regime would have to agree to terms established the previous May.

None of the tricks that worked under Trump’s predecessor to stop a ceasefire worked this time. It was an offer the Zionist entity could not refuse.