As inflation persists and the war in the Persian Gulf continues to simmer with no end in sight, Americans are in a sour mood. That could prove bad news for incumbents with next month’s midterm elections right around the corner.
It’s not just that rising energy prices have the national and global economy by the neck; it’s that rising interest rates and the ever-expanding national debt are fostering uncertainty that is stifling growth prospects.
Many have placed the blame for this on Donald Trump’s war on Iran, but this misses a critical point. Runaway inflation did not begin in 2026. While the COVID-19 response had a weighty economic fallout, the worst month for U.S. inflation in the last 40 years was June 2022—a situation worsened by the Russia-Ukraine War and the economic chaos that followed.
The Russia-Ukraine War is often viewed as the “good war” in Washington, compared to the Iran conflict, which many see as manifestly foolish. Yet the inflation numbers and the ongoing carnage in Ukraine show that America would be wise to seek peace in both theaters.
In February 2022, President Joe Biden explicitly warned the Kremlin that if Russia invaded Ukraine, there would be devastating economic consequences in the form of new U.S. sanctions. A month after the war broke out, Biden crowed about how the tough new economic restrictions were crushing Russia’s economy.
This bluster ultimately fell short, but Biden also seems to have failed to reckon with the fact that economic warfare cuts in both directions. Lest we forget, Biden resorted to all kinds of diplomatic shenanigans, like cozying up to Saudi Arabia and even Venezuela, to try to tame the high energy prices fueled by the Russia-Ukraine War.
Higher prices in America were certainly a predictable outcome of the war, since Russia is a major player in the global energy and agriculture markets which greatly affect the U.S. consumer. Even if the U.S. itself has never traded extensively with Russia, its many allies and partners do, and these countries were likely to suffer even sharper economic consequences from the severe sanctions.
When I was in Japan last year meeting with parliamentarians, I heard complaints about the continuously rising price of rice. The same principle holds true in Europe, where energy demand, previously fulfilled by Russian oil and gas, has been pushing up prices.
Still, that was then and this is now. There’s no question that one of the primary drivers for inflation at the present time is the ridiculous situation unfolding in the Strait of Hormuz. As I’ve written elsewhere, the present war against Iran is unconstitutional, strategically unnecessary, counterproductive, and acutely threatening to both the global and U.S. economy.
In recent days, the United States slapped together a deal with Russia for diesel to try to arrest rising fuel prices. Much of the vitriolic condemnation the deal received is justified: Donald Trump seems increasingly desperate while the bizarre gamble is unlikely to make any real difference on prices.
Still, there are two kernels of wisdom in Trump’s recent dealings. First, Trump accurately stated that Ukrainian President Volodymyr Zelensky “could have settled this war many times, many, many times, and he chooses not to.” Second, it is also true that U.S.-Russia relations badly need to be repaired and this process of rapprochement could be crucial to a settlement of the Russia-Ukraine War.
For well over a decade, Washington has supported Kyiv and sought to pressure Moscow. The results are manifest: death and destruction on an ever-larger scale along with soaring prices on basic goods. In order to find our way back to peace, alternative approaches are now needed.
What does peace look like? The same peace plan, more or less, that was floated at the Anchorage summit between Russia and the U.S. last year could still be on the table. Kyiv would have to part with the Donbas region and accept armed neutrality, yes, but otherwise Ukraine could be kept relatively intact. This would stop the bloodbath and finally allow for genuine rebuilding.
No doubt some carrots and sticks would be needed to coax the warring parties toward this solution, but it still remains a possibility, since both countries are thoroughly exhausted by the current conflict’s myriad tragic costs and both are actually quite eager to turn the page. In the meantime Americans must avoid condemning one foolish war while embracing and escalating another “good war.”
The pair of bloody, expensive conflicts in the Middle East and Eastern Europe are tearing at the fabric of the world order, escalating in dangerous directions, and endangering American prosperity. American leaders should embrace difficult compromises and make peace in both conflicts.
Lyle Goldstein is director of the Asia Program at Defense Priorities.