The Munk Debates Podcast - Friday Focus: Is Trump about to TACO out of this war?

Episode Date: March 27, 2026

Trump extended his deadline on striking Iran's power plants, but no one really knows if there is progress on peace talks. Mediators report a vibe that despite the rhetoric coming out of Iran there is interest in ending this war. Meanwhile Trump's public attempts to calm the markets won't work, and the economic damage from this conflict will last long after it concludes. Will Trump agree to any of Iran's demands, including sole Iranian control over the Strait of Hormuz? How will the Gulf States react to a rushed diplomatic solution? Janice worries that the outcome of this war will do the opposite of what was intended, with Iran sprinting towards a nuclear bomb to protect itself against future aggression. Both countries need to make a calculation: are the costs of continuing greater than the benefits of stopping the war?Become a Munk Donor ($50 annually) to get 72-hour advanced access to the full length editions of Friday Focus and Munk Dialogues. Go to www.munkdebates.com to sign up. Hosted on Acast. See acast.com/privacy for more information.

They each are going to make a calculation this week. Have they reached the moment where further pain is not worth the game? I think, frankly, the Iranians have achieved what they need to achieve here. Welcome to the Friday Focus podcast for the week of the 23rd of March. I'm catching up with Janice Gross-Stein, the founding director of the Monk School of Global. Affairs late in the night, Thursday into Friday morning. We're recording this show early. We're going to get it out onto our feeds and into your headphones and speakers early on Friday. So Janice, just that caveat to our listening audience that we are following fast-moving events.

And this show will talk about some bigger themes and issues, but when it comes to the granular details of this unfolding war in Iran, We are caught up to Thursday evening. And let's start there, Janice. The president, I don't know, what do we call it? Maybe we call it Taco Thursdays for Donald Trump. He's extended his promise not to bomb civilian power stations in Iran, which would be against the Geneva Conventions and a war crime.

But I digress. What do you make of this, Janice? What is the president doing? I'm in London at a meeting of defense experts. And there is all kinds of chatter about proposals that are going back and forth. There's an official channel, Pakistan, but there are lots of side channels and sidebrokers. So you could say, and there's nobody who knows, either the Americans or the Americans, or the Israelis or the Iranians who thought this would get done in five days.

There's no concrete evidence, however, that there is progress. So what I can call this, Rudyard, is a vibe mediation. Mediators are reporting the vibe that despite the rhetoric that is coming out of Iran, there is some interest in ending this war. If we look at the market reaction to Trump's extension, the deadline, it's interesting. Oil, in fact, has gone up. The bond market has resumed its sell-off. This seems like the first time that maybe the president's extend and pretend, you know, style vibe,

is not satisfying Mr. or Mrs. Market. What do you make of that, Janice? I mean, we've been talking in some ways about how sanguine markets have been up to this point. I mean, even if this war was to end tomorrow, there are now rafts of data and analysis to suggest that this is the single biggest energy disruption in modern history. There are indications that the supply chain shock and the potential knock-on inflationary effects could well rival COVID. What do you make of this? So what do you make of the president's kind of balancing act here?

He always seems very sensitive to markets. They're kind of a barometer that he always seems gripped by. And yet this time, extend and pretend doesn't seem to be working. And these bigger consequences now are coming down the pipe, regardless of what happens in the next five days. I think that's a critical point, Roger, that these consequences are now baked in. You know, the horse measure declaration by Qatar on LNG,

statements are coming out of Qatar that it would take up to three years to repair, three years to repair the damage to infrastructure. There is extensive damage in some of the Gulf states. This is not a question of the war stops next week or 10 days from now. Whenever it stops and then all these supply shocks in, it will take weeks and months to return to the pre-war status quo. finally, I think the markets are catching up. And the other thing I looked at today, Roger, and I'm sure you did too, are predictions

of the inflation rate in the United States, 4.2%, at least 1% higher than they were before this war started. Right. And let's remember people that are supposed to be at 2% according to central Bank doctrine. So the extent to which rate cuts were priced in before this war, a number of rate cuts, both in the United States and in Canada, those have gone away. And markets are now predicting the possibility of rate hikes. And I think that, unfortunately, is going to come true. Let's return a bit more to the president, though, Janice. I mean, he does seem as if something

has happened to him since the weekend and his bravadocio kind of threats to bomb Iran's power stations. He now, I don't know, has the penny dropped, has someone somehow convinced or made him understand the damage that this war has already done to the global economy, the extent as we just talked about, inflation will be on the rise. This will be happening in the lead up to the midterm elections. You just have this sense, Janice, that he is suddenly very anxious to find an off-ramp when that just wasn't the case a week ago.

No, it was not. And look, Roger, just before I answer your question directly, one more comment, just that the ending of this story is not yet told. one of the significant things that happened this week, a thousand members of the 82nd Airborne Division were deployed to the Middle East. This is different from Marines. These are the troops that can be deployed in 18 hours can land anywhere, are flexible. And so he is keeping his options open.

I think that's very important for people who understand, both with the Marines and with the airborne, should these talks go nowhere? Should they be absolutely deadlocked by this new deadline of April the 6th? It is entirely possible that the fighting could resume. Why is he changed? Who knows? Because none of us can get into his head. I think one of the significant factors is that Israel is saying,

looking, look, the situation will not fall. They were among the most optimistic at the beginning. They are no longer. And the advantages of continuing for much longer are not great. And Rudyard and here's, I think, the critical piece, they signal that an attempt to occupy Karg Island would be fraught. The Iranians have reinforced it. It would be a fierce fight and there would be American casualties.

That's what Donald Trump is hearing now that he did not hear last week at this time. He also seemed like he didn't hear, Janice, that Iran could close the straits of Hormuz. I mean, it's just so jaw-droppingly uninformed. I mean, as we've increasingly heard from former presidential officials at the highest levels of the White House and different administrations from George W. Bush to Barack Obama, this scenario was one of the most studied, documented, investigated risks. And there was a whole reams of intelligence and military analysis of this very situation. And again, I just, I'm just, how can you, it's like, you know, walking into, yeah, walking into your bathroom and there's an elephant in there and you decide not to see it. I mean, I don't know.

We can litigate what happened here, but I just think it has to be affecting this week, Janice. It's as if the president somehow through some kind of myasma of, of, again, braggadocio and seeing what he wanted to see has suddenly been read into the file that every other president and serious decision maker in America has known about for the last quarter century. You know what I am here with a group of what we call former White House officials, former defense officials in the Pentagon, and what you just said, they are saying with far more colorful four-letter words that I know, dear gentleman, otherwise I would use them to you, but it's out of consideration for your sensibilities that I'm not. not going to use the actual words that they describe this.

And again and again and again, we come back to the same story. You know, the National Security Council effectively decapitated at the beginning of its administration. No staff work, the only staff work that was done, was done by General Kane. And, you know, I've talked about the fact that he warned that reaching change was not back into this. He was pretty careful. And in fact, officials leaked that warning, which shows you how much opposition there was

from the professional military. You're right. I think Donald Trump is finally catching up to the music that people are trying to make him here. But then again, I have to say this. And if any of our listeners can do it, I watched the video of the cabinet meeting today in which Steve Witkoff did this presentation, it goes beyond memes, frankly.

It's just you're watching something. First of all, no serious cabinet meeting would be live stream, registered, frankly. There would be discussion and serious debate, but just the whole tone, the modulation of the president, the thick of theancy. It's no mystery

why the message didn't get through, frankly. Yeah, and we have reports that Jared Kushner, who's the wingman to Steve Whitkoff on, I guess, indirect negotiations happening through Pakistan with whoever in Iran is on the other end of the phone

is seeking multi-billion dollar investments for his hedge fund from Gulf states. And Steve Whitkoff is not going to be left behind. He's got to get into the act too. There are New York Times reports that the Roosevelt Hotel, which is owned by Pakistan, has been closed in New York for a number of years. Whitkoff is, you know, busily making lemonade out of lemons and talking with the Pakistanis about how the American government and no doubt at some point, the Trump family or the Whitkoff family,

can assist in the real. opening of the historic Roosevelt Hotel in New York, New York City. Janice, this, this, Rome is burning. You don't go away with it. You have to just laugh at it, I think. Well, you know, I don't want to serious, right? This is a self-inflicted own goal by the United States on itself. And really, one of the other things I've paid attention. to last couple of days because the voices are getting louder and louder is the concern among Gulf states. They are now saying to the president, you cannot end this war unless this highly enriched uranium

is accounted for and secured. We cannot live in the Gulf with an Iran that has tactical nuclear weapons or any other kind of nuclear weapons. And this is not only the Saudis who you would expect to make this argument and Mohammed bin Salman is making it. It's all the Gulf states that are saying this now. So the U.S. security guarantee to the Gulf states is on the line. So yeah, let's go there, Janice.

It's fascinating because I was thinking, too, that there seems to be a willingness on Trump's part to consider some kind of co-ownership of the Straits of Hermos, in his words, with the Ayatollah of Iran. And I just, I couldn't see how that would be acceptable for one moment to the golf states who then, just to obviously give people a snapshot of the geography, all their energy export terminals, many of them are trapped behind this, the Strait of Hermos. So they would be paying a toll to Iran. There would be the sense that if Iran didn't like what they did or said that that they could charged more or maybe their ships would not be allowed through the straight. Who knows? It just creates an uncertainty. And uncertainty, as we know, is a killer for economies and markets.

So what do you think is going on here, Janice? Do you see a possibility that Trump in his desperation to get out of a war, which now I think he finally has come to understand what its consequences are and its complexities are could throw the Gulf states over? I don't think so. I don't think so really for two reasons. One of the reasons you just talked about, there's such a meshment of the Trump family, his two sons and Wickoff and his two sons

with leaders in the Gulf in financial investments and transactions. And that would produce such outrage on the part of the Gulf to the Trump administration that I think that's the really powerful constraint. But secondly, let's just unpack for a minute, which you just talked about, Iran, one of Iran's five demands is that they will charge a toll for ships transiting the Gulf.

And they've also said that enemies of the errors, Israel and the United States, and by implication, Gulf states, which host U.S. bases, And they've talked about this explicitly. So just imagine that. An agreement on the terms that Iran is now putting forward, but they did put forward five points today. Those terms would enshrine sole Iranian control over the straits.

Not only would they charge a very significant toll on all the oil and energy that comes through the Gulf, but they would decide who could transit. That I cannot believe that there is any scenario in which the United States would accept that agreement. Yeah. So I agree, you know, so let's extend that logic then. What does that mean then about this extension for five days? I mean, it seems unlikely that Iran would agree to the 15 points. It seems that they would want something in return.

It's not as if they've been defeated. They're continuing to fire off rockets and drones. They have an increasing sense they must that the president is souring on this war and is becoming more fearful of its consequences. Maybe now that he understands finally its magnitude, why would they settle for anything other than a compromise that would reveal to the Americans that they, They effectively had ended up with an Iran that was, yes, beaten, battered bruised, but maybe strategically in a better position. And why would the Gulf states accept that outcome? So a lot depends, Roger, on how much pressure the Revolutionary Guard is inside Iran.

Let me just set the stage. We have seen no satellite pictures. since this war started of Tehran. You know, the private satellite providers, like planet and others, have been asked by the U.S. government not to release these pictures because they do not want the Iranians to be able to assess bomb them. That being said, there are 7,000 bombing runs that have occurred this month. Just imagine.

We have no sense of what the city looks like. We have no real sense of how bad the damage is to the infrastructure in Tehran and in other parts of Iran. There is a day after for the Revolutionary Arts too. Yes, they're asking for reparations, but sanctions relief will be considered reparations, some Band-Aid solution like that. Ultimately, they will need capital to rebuild a shattered economy and a shattered infrastructure. The longer this war goes on, the worse it is from that perspective.

And if by April the second, and even if there's one more extension, there is no agreement, there will be a sharp escalation in the fighting. So the revolutionary guards have to make a really tough decision. And that's really the point of the strategy. Bounce the ball to them so that they confront. Do we stop now? do we lock in our gains? Do we create some sources of revenue

by which we can rebuild our economy because those same revolutionary guards are standing in front of a population that in January took to the streets over the cost of food, the lack of electricity, and the inflation and the depreciation of the Iranian currency.

I want to thank a new curator, Glenn S for his generous contribution to the Monk debates and our efforts to bring civility and substance to the public square and in as a as a thank you to Glenn S's generosity and to urge others of you who have not become donors to the Monk debates. We're going to continue the second half of the show for the general public and not go behind our donor wall for this episode of Friday Focus. I'll just make an executive director's call, given the importance of this war,

and the issues were to put the Monk debates into the public's service. Janice, if we think about what you just said, I guess the problem becomes, as in any negotiation, you can look at the Ukraine war, it's lasted for years now. How do the two sides find some common ground where on one hand the Americans have all of their reputational credibility on the line that you know the extent to which you know a future opponent in China or or elsewhere

you know will will take their their threats and and be deterred in a sense by by the potential of of U.S. military, economic, and other power to deter a country like China, let's say, from invading across, you know, the South China Sea into the Straits of Taiwan into Taiwan proper. I mean, so how do you square those demands, those strategic needs at the United States, with, as you say, real needs for the Revolutionary Guard. Yes, on one side money, but on the other side, they need to reestablish their strategic deterrence too. They need to come away with this

with something that shows that they are to be feared and that strikes, like the now multiple strikes that have happened on them, where they are either in the middle of negotiations or they have not, in the first case of Israel's attack last year, have not preemptively launched offensive operations,

their credible deterrence has been destroyed. So, I mean, I want to try to be optimistic here, but I'm just struggling a bit, at least in the space of five days. How do you settle for this yawning gap between the respective strategic objectives of these two powers, and the missiles are still flying?

It suggests, yes, maybe Iran's had 7,000 bombs, dropped on it, still seems to be able to threaten Israel, unfortunately, attacking civilian and other targets, along with its Gulf state neighbors. I mean, you're absolutely right today was one of the largest barrage, the largest number, not of missiles, but barrages of missiles on Israel in quite a while. So there clearly is a capacity that Iran still has to launch missiles. this deal cannot get done by April 6th. This is a complicated negotiation.

It will take time. So what's the goal for the next stage if there is any goal whatsoever? It's to get an agreement on one or two principles. That's all. And to move toward a ceasefire, which is conditional on negotiating a much more complicated agreement. And you give yourself two months, three months. to get that more complicated agreement done. There's no way that a detailed agreement can get done by this April 6th deadline.

So really the question is, do the Revolutionary Guards feel they want to stop now? Or do they feel that they want to inflict additional pain, which is largely through the oil market, at the cost of likely an escalated attack against, You know, the islands that are in the Gulf. It's possible the United States could seize Iranian oil that passes through the that is not a difficult naval operation for the United States to, for the U.S. Navy to engage in. There are still options that the United States has here.

So this is a game of who blinks first. neither of them are sufficiently desperate that they're willing to capitulate. So who blinks first? And we will know over the next three or four days, Iran is clearly not willing to ceasefire until it has some confidence that there is an agreement in sight that they can live with. So what's your bet, Janice? I mean, who blinks first? The president seems increasingly anxious.

But again, I just, I can't, I can't really conceive of an American blink given the pressure from the Gulf states, America's own kind of somewhat tattered deterrence at this point. Because again, as I sound like a broken record, but he flip-flopped on China. He flip-flopped, you know, on massive sanctions against Russia and, you know, real threats to Vladimir Putin after that Alaska summit. when, you know, Putin was supposed to come through and he didn't. And then he flip-flopped on Greenland. So if they back off this, Janus, I would just think if you're China, I would say maybe it's even, I take no satisfaction of this, but maybe even it's good news for Canada and our negotiations around Kuzma.

The fact is that this president has lost so much credibility. He seems to have so little tolerance for, for actual economic and political pain. He'll take the risks, but he won't take the consequences. It suggests, in fact, a bit of a paper tiger. And maybe our perceptions, again, of how scary he is and how threatening he is, maybe this is much more the Wizard of Oz than some real kind of ogre. that we genuinely have to fear.

Because I think every case so far, Janice, with the exception of Venezuela, which is truly, and maybe Cuba, which are the weakest of the week, which is exactly what a bully does, praise on the weakest of the week. Everyone else who's not in that category deals with his president's threats,

his braggadocio, but at the end of the day, consequences are pretty minor. Yeah, I think that's right. Where Trump persisted, rather, was when it was easy. And the two most difficult cases for him have been China, because China has a stranglehold in critical minerals. And the consequences were very obvious. And now that we're four weeks in, the price of oil is going up.

Stock markets are going down. Inflation is predicted to rise. It is no longer easy for him. The other side of the story, I think the Gulf states would be so alarmed now if that enriched uranium is left unsecured and unaccounted for that their confidence in the value of any kind of American security guarantee would vanish to zero. And that is a huge cost for the United States, huge. Very similar situation. Gulf states cannot live with Iranian control, sole control of the Straits of Form rules.

And let me just say, for the record, this could get worse. You know, so far the Saudis and the Emirates are exporting oil overland through pipelines into the Red Sea. The Red Sea is within missile range. And that could be compromised as well. So I'm not ruling out the possibility that this could get worse. And that's, I think, if I'm not ruling it out, I don't think the Revolutionary Guard can rule it out either. So they each are going to make a calculation this week.

Have they reached the moment where further pain is not worth the game? I think, frankly, the Iranians have achieved what they need to achieve here. They've shown the world that they can shut off oil. They've shown the world. They can cause a global supply shock to energy markets. It's hard for me to see what the advantages are. But do they give up their enriched uranium, Janus? Because if you're the Revolution Guard right now,

you've had two powerful object lessons that you need an atomic weapon. That's a big issue. That's a big just to the advantage. because let's just put this shoe on the other foot. The Iranians attacked Israel multiple times now with significant barrages of ballistic missiles, paralyzed their economy, that's kept that whole population in shelters

on and off every night, and the Israelis have a nuclear weapon. The other example, though, is North Korea. North Korea has nuclear weapons, and no one touches North Korea. But Iranis, no. going to be in a position to race to a nuclear weapon. That's the big difference.

You know, eyes are on that uranium. Well, if they're allowed to be, though, because the international atomic agency is not in Iran. It has no visibility into this. The same problem with North Korea. There was a long period of time when everyone wanted to stop a North Korean bomb, and we didn't. This technology is a known known. People know how to create it. In fact, it's probably become easier to become a nuclear power even, let's say,

then a decade ago. And they've already got the material at 60-odd percent. I've seen reports that to refine that 60 percent uranium into weapons-grade, fissile material would take a structure the size of two shipping containers, filled with centrifuges. This is not a massive energy plant or a big piece of infrastructure that you would need to build in order to simply test a nuclear weapon underground to signal that you are nuclear power. Yeah, but here's, I think, the difficulty for Iran, which the North Koreans did not happen.

Right now, there was constant 24-7 satellite monitoring. Intelligence, U.S. intelligence, knows where that goes. uranium is. That puts the Iranians under a very different situation than the North Koreans, number one. Now, something interesting happened today. For the first time, Iranians admit that they have this enriched uranium and then have enough uranium to make 11 nuclear bombs. They actually set that.

That was somebody from the Republican guards that in a post acknowledged that if that's a big surprise, but you know that has been a disputed issue. And the estimates are that they could make one bomb very quickly. Within, so there's a whole argument about was there anything imminent. Imminent is different from how long would it take. It could take two, three weeks to make a dirty bomb. That's all. So with or without a ceasefire agreement, nobody is going to take their eyes off the minute by minute's satellite coverage of the three sites where that

enriched uranium is. If it's, yeah, but if it's at those three sites, we... There's pretty good information by the, there's pretty high confidence. I mean, I've, again, you have to filter your information, but you know, the amount of rich uranium

they have can literally be moved around in the trunks of cars. It's in canisers, you're right. Yeah, so I mean, you don't need trains. You don't need planes. Who's to say that they didn't disperse a lot of this enriched uranium a long time ago? Who's to say that over years they haven't been siphoning off portions of enriched uranium and, you know, secreting them at, you know, hideouts around a country that's almost the size of Western Europe?

I don't know. There's so many suppositions here. It doesn't make sense for us to go down all these different rabbit holes. But I guess I just want to end the episode by getting your sense on at the core of this dispute now between the United States and Iran for the better part of a decade and a half has been this uranium. It's been about peaceful enrichment for military ends, which is what everyone knew that Iran was doing. and hence there was a desire to monitor that peaceful enrichment. People felt that that wasn't working because why were they creating all this other fissile material at 60% or higher? We culminate in this war.

Do the Iranians give this all up? After having spent, there's estimates something approaching half a trillion dollars on this country. With a terrible economy, right? Yeah, half a trillion dollars on this program. At a moment where they've been bombed unilaterally twice, do they just suddenly say, okay, it's all over to you. We're done with this. I think that's unlikely.

Yeah, I agree with you, but I don't think the choices are that black and white. Okay. in the earlier negotiations, one proposal that was put on the table was Iran could keep its enriched uranium in Iran, governed by a consortium of Gulf states and Iran. Now, those were the days before Iran blew its relationships with the Gulf states. So what would matter is not taking the uranium out of Iran, but that there was a consortium that could monitor these canisters of enriched uranium. There are several ways this can be done. And there are two make it or break it issues.

That's all in this negotiation. One is the uranium. The other is opening the straits. there are creative ways to have eyes on that uranium without denying Iran its right to enrich, which it has under the NPT treaty, and which has always asserted. And today, again, the Iranian said they have no intention of building a nuclear weapon. Now, that's important. That's not nothing.

Why? Because Ali Khomey, who was assassinated, had issued a fatwa, a religious institution. agree against nuclear weapons. That fuckwood died when he died. So this is the first time, since this assassination that the Revolutionary Guards have said, we continue to honor that. We will not build a nuclear weapon.

So if there is the desire to stop the war, there are many ways to do it. The real question to me, do have the Iran, has the Revolutionary Guards, do they feel that the cost of continuing are greater than the benefits of stopping right now. Because at some point, that will be true for them.

There is the morning after for those guards who are hated by more than 50% of the population. It's going to come someday. It's just when. Yeah. I just, it's a terrorist regime. I just don't know if you can take them at their word on anything. And they can say, they can say, well, well, you know, we'll have some consortium of countries come in and we'll enrich stuff together.

And who knows where, where, what? American proposal budget in the last round that the Iranians protect. Yeah, because they want the optionality. The optionality to raise to a bomb is a form of deterrence in itself. It hasn't worked that well, but it's kind of all they've got. Anyway, Janice, a great discussion today. we're going to let you get on with a very late evening there in the United Kingdom. We appreciate our audience understanding that we're recording this late Thursday.

And again, a big thank you to Glenn for making the back half of the show available to everyone. I'm Roger Griffiths, the chair of the Monk Debates. We'll talk to you again soon. Bye-bye. Bye-bye. The Monk Debates are a project of the Aurea and Peter and Melanie Monk Charitable Foundations. Rudyard Griffiths and Ricky Gerwitz are the producer. Be sure to download and subscribe wherever you get your podcasts.

And if you like us, feel free to give us a five-star rating. Thank you again for listening.