Trump and ‘the greatest protection racket in history’

Opinion: In addition to failing to protect its client states from Iran, it appears the US intends to bill them for the costs of the war too says Gehan Gunasekara.

This oil tanker is in a queue and is waiting for its turn to get loaded by barrels of oil. Here is the Persian Gulf in the south of Iran.
The recent blockade of the Strait of Hormuz by Iran represents the ultimate blowback: Iran is now essentially doing to the entire world what the US has been doing to Cuba.

We are all experiencing economic pain and hardship from the war unleashed against Iran. Lawyers call this a directly foreseeable “consequential loss” which normally can be recovered from the party responsible when a domestic lawsuit is brought.

In this instance the wrongdoers are Israel and the United States, whose attack – in clear breach of international law according to virtually all experts – was the trigger that initiated this economic fallout.

Countries cannot be sued in domestic courts, but there are lessons nonetheless as to what happens when the rules-based order is entirely disregarded .
Iran conflict’s economic knock likely just the beginning

In 2015, I attended a legal conference in Ho Chi Minh City (formerly Saigon) in Vietnam. The social programme included a visit to the famous nearby Củ Chi tunnel complex.

I was amazed to navigate the maze of tunnels constituting an underground city where Viet Minh guerrillas had lived, fought and prevailed within sight of Saigon airport, the main American airbase at the time.

Massive craters dotting the park reminded visitors that B-52 bombers had been forced to (unsuccessfully) bomb the vicinity of their own airbase to try to eliminate the guerrillas. 

This is nowhere more evident than the pernicious decades-old economic embargo the US has maintained against Cuba, originally imposed by a Democrat, John F Kennedy, but recently tightened through an inhumane and undoubtedly illegal blockade of all oil to the island. 

It was also a reminder that the much-vaunted United States military has, despite its technological prowess, faced limitations when confronted with asymmetric warfare.

That war, which lasted over a decade, saw statements along the lines of “bomb them back to the stone age” – threats that have been made by Donald Trump against Iran.

Once the strait is re-opened, I would not be surprised if Gulf countries restrict output to maintain the price of oil.

The reason I mention this is that there is little new in Trump’s actions. They follow a standard American playbook, Trump being merely an extreme manifestation.

This applies to the many conflicts that have taken place since, in Iraq and Afghanistan prior to the recent one, which have all involved US and allied casualties, targeting of civilians, appalling human rights violations as documented by WikiLeaks and others, and ultimately failure or only partial achievement of war aims.

This is nowhere more evident than the pernicious decades-old economic embargo the US has maintained against Cuba, originally imposed by a Democrat, John F Kennedy, but recently tightened through an inhumane and undoubtedly illegal blockade of all oil to the island, which has involved threats and coercion of third countries.

The recent blockade of the Strait of Hormuz by Iran represents the ultimate blowback: Iran is now essentially doing to the entire world what the US has been doing to Cuba.

This brings me to the crux of the matter. I have already referred to the global costs of this illegal war.

What about its actual costs for the instigators? A clue was provided by Trump himself, who publicly expressed the desire that his Gulf allies, including Saudi Arabia, pay for the cost of the war.

In addition to failing to protect them from Iran, it appears then the US intends to bill these client states for the costs of the war – except that currently most Gulf countries are unable to earn income because of the strait’s closure.

Undoubtedly, the Iranian regime has an unsavoury record on human rights but so do many US allies, including Saudi Arabia – recall its brutal murder of dissident journalist Jamal Khashoggi. Saudi Arabia has purchased hundreds of billions of dollars of arms from the US.

Now, it appears more of their petro dollars must subsidise US taxpayers for the horrendous costs of sustaining the war.

Once the strait is re-opened, I would not be surprised if despite undoubted tensions between some of them, as evident from the UAE pulling out of OPEC to increase production, other Gulf countries restrict output to maintain the price of oil. We would then be paying for the very weapons being used to make our lives precarious.

It would be the greatest protection racket in history.

If this war ends up wrecking the global economy, hostility to the US will not be limited to that of Iranians. For Israel, its attempt to eliminate one hostile Middle East competitor will likely instead vastly increase the existing antipathy towards its foreign policies, following its actions in Gaza.

Other nations will also reflect on the costs and benefits of hosting US bases on their territory. For everyone, there will be a price to pay.

Gehan Gunasekara is a professor of commercial law at the University of Auckland Business School. 

This article reflects the opinion of the author and not necessarily the views of Waipapa Taumata Rau University of Auckland.

This article was first published on Newsroom, 30 April, 2026

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