When the sovereign strikes: force, commerce, and the cost of war

The BBC reports that the United States has launched fresh strikes on Iran, with President Trump warning that he has not yet decided whether to 'finish off' the country. I will not pretend to know the operational details — the targeting, the ordnance, the chain of command — that belong to a military science I never possessed. But the moral and economic questions that surround any sovereign's decision to make war are precisely the questions I spent my working life on, and they do not expire.

I argued in The Wealth of Nations that the great cost of war falls not on the ministers who declare it, nor on the merchants who sometimes profit from it, but on the ordinary working people and consumers who pay for it twice: once in blood and once in treasure. Wars are financed by debt, and debt is repaid — when it is repaid at all — by taxation that falls heaviest on those least able to bear it. The sovereign who goes to war cheaply, in his own estimation, is spending a currency coined from his subjects' future labor. That accounting does not change because the weapons are more sophisticated.

There is a further point that I think often escapes those who invoke force as a policy instrument: commercial exchange, properly ordered under the rule of law, is itself a kind of peace treaty, renewed daily. When two nations trade, each has a material interest in the other's continued functioning. Interrupt that exchange — whether by embargo, by sanction, or by strike — and you destroy, along with whatever military target you had in mind, a portion of the mutual interest that made restraint rational. I do not say commerce makes war impossible; I say it raises its cost to both parties in ways that are rarely fully entered into the sovereign's ledger.

The institutional question I would press hardest is this: what framework governs the decision to use force, and who within that framework speaks for the consumer, the workman, the taxpayer — the people who are not in the room when the order is given? I was deeply suspicious of merchants who captured the organs of state and turned public power to private advantage — the East India Company being the most egregious example of my acquaintance. A parallel suspicion attaches to any arrangement in which the costs of a military adventure are socialized across the whole population while the strategic rationale remains opaque or personal. That is not a republic conducting its foreign affairs; it is a private interest wearing a sovereign's coat.

I mark as inference, not recollection, any claim about Iran's intentions, the legality of these strikes under present international law, or the precise economic consequences of this particular escalation. Those are matters for people with access to facts I do not possess. What I can say with confidence, drawn from the durable logic of political economy, is that a nation's wealth is built by the patient accumulation of productive exchange, and that war — even a war that is morally justified — consumes that accumulation faster than any other human activity. The sovereign who treats military action as a cheap signal, a way of showing that he is not to be trifled with, is spending his nation's capital on a display. History does not record many instances in which that was a bargain.