We have voiced our objections to the militarization of the language surrounding foreign exchange and trade. For several years, the media and journalists played up ideas of currency wars–beggar-thy-neighbor competitive devaluations. Leave aside the fact that it was often indistinguishable from easy monetary policies to facilitate economic recovery and arrest deflationary forces.  

Now it is trade wars, which have captured imagination. While trade tensions have increased, these still seem to be low rungs on the escalation ladder. So far, the trade actions cover a very small part of global trade and a small part of US trade. Announcing details of previously announced measures should not count as fresh escalation. However, with China’s retaliation, the ball is back in the US court. Should the US retaliate now, the provocation would be an escalation. 

However, there are real wars taking place that are not simply metaphors. Yesterday, Houthi rebels in Yemen struck a Saudi oil tanker with a missile. The attack in retaliation for a Saudi strike on the only Yemeni seaport controlled by the rebels. Saudi Arabia has led a coalition that has been bombing the Houthis and their allies for three years.  

The Houthis do not have an air force, but they have supplied with missiles, ostensibly from Iran, which have been used against Saudi Arabia. Last month they struck with seven missiles. Yemen is a catastrophe. The UN estimates that 22 mln of the country’s 27 mln people need emergency aid, and 2/3 of the people have little or no food. Yesterday, UN Secretary General Guterres said that more than half the money raised for Yemen has come from Saudi Arabia.  

The conflict is generally understood as an expression of the underlying conflict between Iran and Saudi Arabia. That conflict cannot be simply reduced to the Sunni/Shia. Saudi Arabia is reaching out to the other large Shia country, Iraq. There are a wide range of issues that separate Saudi Arabia and Iran and that conflict seems to be superseding the Israel-Palestine issue as the main organizing principle in the Middle East.  

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