Vince Dhimos answered a question at Quora.
How much harm can Iran cause for American interests?
Vince Dhimos, Editor-in-Chief at New Silk Strategies (2016-present)
Answered just now
Iran can cause a lot of harm to the world economy by closing off the Strait of Hormuz to the oil trade. And if the US decides to use its military to open the strait again, it risks, for example, losing an aircraft carrier valued at billions of dollars, plus all the valuable aircraft on said carrier. That would put Trump’s re-election in grave jeopardy. Iran has also threatened to move against Israel and against Saudi oil production assets. Of course, all of this would raise the price of oil, and although Trump claims he wants low oil prices, he most certainly does not. (I am not saying he is a LIAR, just that he is not telling the truth). The US shale oil producers need high oil prices to survive, which is why Trump is not risking much to cut off Venezuelan and Iranian oil supplies. It indirectly helps US oil companies — but for how long, we don’t know. Besides, if oil prices skyrocket too much, that too would reflect badly on Trump.
But the biggest problem is not what Iran can do, it is what the US is doing to itself without apparently realizing it. All the sanctions against different countries, especially Iran, are causing a major backlash against the US dollar. Europe, generally eager to continue trading with Iran, has, with help from allies, developed a special purpose vehicle called INSTEX, which will enable Iran’s trading partners to settle in non-dollar currencies, ie, mostly euros, and the amounts spent will be hard to trace because they circumvent SWIFT, the system located in Belgium but controlled by the US Treasury. In other words, it will be hard for the US to impose sanctions for these unreported transactions.
On top of this, we find Russia off-loading almost all of its Treasuries, and other countries like Japan and China, as well as others cutting back on their holdings. (It is the sale of Treasuries that keeps the dollar afloat). Further, Russia and China have just inked a deal to stop using dollars in bilateral trade. One of the things floating the dollar has been its use in world trade settlements, but this Russia-China deal, the creation of INSTEX and many other factors are reducing this use in world settlements, which seems to be gradually causing various countries, including US allies, to shun Treasuries, expecting a drop in the value of the dollar.
Since the future of the USD is uncertain to say the least, the issue of how to pay down the US sovereign debt is becoming urgent. This is why both Democrats (eg, Elizabeth Warren) and Republicans are now floating the idea of deliberately devaluing the dollar – although they are using the excuse that this will supposedly boost US exports by making US products more affordable. (See our analysis of this strange turn of events here.)
Of course, no one is mentioning the very real possibility that the Chinese might also follow suit and adjust the value of the yuan accordingly, making this US policy futile.
What’s interesting is that no one asked the US public if they thought living solely on credit was a good idea for the American government. But of course, as we showed here, while Washington and a lot of NGOs are frantically promoting “democracy” abroad, there is absolutely no government of the people, by the people and for the people in America. And the Russians are by no means the culprits.