Council on Foreign Relations' Richard Haass on Iran: 'This was not a war we had to fight now'
Summary
- The US administration has engaged in a "war of choice" with Iran in March 2026, which Richard Haass deems undisciplined and lacking imminent threat justification.
- Haass notes that the US has killed the Ayatollah and diminished Iran's nuclear/missile capabilities but warns that "regime change" cannot be achieved solely through air power.
- Iran is currently retaliating by attacking "virtually all of their neighbors," creating significant geopolitical instability in the Middle East.
- Markets are reacting negatively because the US is failing to project an image of competence regarding its war aims and exit strategy.
Trade Ideas
Richard Haass
President Emeritus, Council on Foreign Relations
"One of the things that's going on now is they're attacking virtually all of their neighbors." Iran's neighbors include major oil producers (Saudi Arabia, UAE, Iraq, Kuwait). If Iran is lashing out regionally, energy infrastructure and shipping lanes (Strait of Hormuz) are at immediate risk of disruption. Supply fears drive oil prices higher. LONG oil as a geopolitical hedge against supply chain destruction in the Gulf. A sudden ceasefire or US diplomatic capitulation rapidly lowering the risk premium.
Richard Haass
President Emeritus, Council on Foreign Relations
"There's no way we're going to send in ground forces... Instead of talking about regime change, which we can bring about from offshore... We've diminished their nuclear capabilities yet again, their missile capabilities." Haass confirms the US strategy relies entirely on air power ("offshore") and missile strikes rather than boots on the ground. Furthermore, Iran attacking neighbors necessitates heavy investment in air defense systems (Patriots, THAAD, Iron Dome) for regional allies. This creates sustained demand for prime defense contractors. LONG defense primes due to high kinetic activity without ground troop deployment. Budget constraints or a shift in US administration policy to de-escalate completely.
Richard Haass
President Emeritus, Council on Foreign Relations
"I think that's one of the reasons you're seeing the markets doing what they're doing today is uh the United States is not projecting an image of competence." Markets hate uncertainty. Haass explicitly links the current market sell-off to a lack of faith in US leadership and undefined war goals. Until the US defines "success" or an exit strategy, the risk premium on equities will remain elevated. SHORT broad equities as the "competence discount" gets priced in. The US administration suddenly clarifying goals or achieving a decisive, quick victory that restores confidence.
