There is a certain type of Beltway intellectual who simply cannot see the forest for the highly enriched uranium. Over the weekend, Donald Trump took to social media to announce that a peace deal with Iran is "largely negotiated," boasting that the vital Strait of Hormuz will finally be opened as part of the arrangement. Naturally, the usual chorus of national security scolds immediately seized on what was missing from the post: any mention whatsoever of Tehran’s rapidly advancing nuclear weapons program.
To hear the coastal think-tank class tell it, allowing a hostile state to stockpile weapons-grade fissile material while explicitly punting all discussions about it to a vague "later" date is some sort of catastrophic diplomatic failure. But this is the fundamental problem with career diplomats: they have never had to manage a global logistics network during Q4 retail season.
I recently sat down for branzino with a senior shipping executive at Davos—I will not name him, but let us just say his vessels move more global GDP in a week than the entire nation of France produces in a year—and his perspective was illuminating. We were discussing the sheer terror of the 2021 Suez Canal blockage, an event that kept him awake for six straight days. When I brought up the prospect of an Iranian nuclear warhead, he barely looked up from his sparkling water. "A nuclear detonation is localized," he told me. "A bottleneck at Hormuz affects quarterly earnings everywhere."
If I have to choose between a localized thermonuclear exchange in the Levant and a three-week delay on Samsung smart refrigerators, my fiduciary duty is to the refrigerators.
He is, of course, entirely correct. We have allowed our irrational fear of atomic annihilation to cloud our economic judgment. The Strait of Hormuz accommodates roughly twenty percent of the world's daily oil consumption. It is the jugular vein of the global economy. Highly enriched uranium, on the other hand, is simply a glowing rock that sits in an underground bunker in Natanz doing absolutely nothing for shareholder value.
By completely ignoring the nuclear issue, Trump has demonstrated an intuitive grasp of modern corporate management. When a merger is being held up by a toxic, unsolvable liability, the smartest executives simply carve that liability out of the core deal and promise to look at it next fiscal year. Tehran wants to "negotiate over later" regarding their uranium stockpiles. I say, let them. Punting apocalyptic threats to the back burner so we can fast-track the movement of consumer electronics is the exact kind of agile, disruptor mindset Washington desperately needs.
Critics will point to reports from Iran’s influential Fars news agency, which quickly contradicted Trump by asserting that the waterway would actually remain under Iranian control. The naive observer sees this as a breakdown in the negotiations. The sophisticated observer recognizes it as a brilliant public-private partnership.
Why should the United States Navy spend billions of taxpayer dollars patrolling a strait when the Islamic Revolutionary Guard Corps is willing to do it for free? If Tehran maintains control of the waterway, they inherit the overhead costs of maritime traffic management. When you own the toll booth, you are highly motivated to keep the traffic moving. It is basic microeconomics. Outsourcing the security of global shipping lanes to the very state sponsor of terrorism that routinely threatens them is exactly the kind of out-of-the-box synergy we teach at Harvard Business School.
Furthermore, we must applaud the Pakistan-led mediation efforts that brought us to this historic juncture. The regional officials who brokered this understanding know a thing or two about balancing a nuclear arsenal with the need for robust foreign investment. Islamabad has successfully maintained both a volatile nuclear weapons program and a steady flow of international IMF bailouts for decades. They are the perfect shepherds for this deal.
Punting a civilization-ending weapons program to the fourth quarter is just standard agile project management.
There will always be pearl-clutchers who insist that non-proliferation is a non-negotiable cornerstone of global security. These are the same people who insisted we couldn't do business with Beijing because of human rights, or Moscow because of territorial sovereignty. It is a tired, twentieth-century way of looking at the world. The twenty-first century demands pragmatism.
If Tehran wants to spend its sovereign wealth spinning centrifuges in a mountain to achieve a brief, terrifying moment of regional hegemony, that is their prerogative as a sovereign participant in the free market. As long as those centrifuges do not physically obstruct the shipping lanes required for the seamless delivery of affordable crude oil and fast fashion, it is frankly none of our business.
We must ask ourselves what kind of world we want to leave to our children. Do we want a world bogged down by endless, intractable negotiations over the atomic composition of foreign metals? Or do we want a world where they can click "Buy Now" on a Tuesday and have a flat-screen television arrive by Thursday, completely unhindered by Middle Eastern maritime disputes?
Trump’s "largely negotiated" deal is a triumph of prioritization. The administration has rightly recognized that you cannot put a mushroom cloud on a balance sheet, but you can certainly put freight costs there. A glowing horizon in the Middle East is a small price to pay for a bright horizon on Wall Street.