Israel, Iran and the high economic and human price of war
War not only blurs borders, but is a bottomless pit that scars economies for the rest of their history.
- The costs of defence and attack
- How much budget does Iran have?
- What are Russia's and China's interests?
- How much are Israel's allies willing to spend?
- How will the US elections affect Israel?
Since 7 October 2023, escalating violence has unleashed unprecedented tension, leaving more than 40,000 dead and 91,000 injured in Gaza, more than 1,400 Israelis dead and 250 kidnapped, more than 60% of Gaza's territory in ruins, thousands injured in Lebanon, and uprisings in Syria, Iraq and Yemen, resulting in hundreds of injuries.
Roadblocks, sanctions, price hikes... these are just some of the consequences that have put the spotlight of war on the cost of war. How many more casualties must there be? How long can Iran and Israel hold out? And their allies?
Israel, due to the remoteness of its targets and the necessary protection, cannot confront Iran on its own or destroy its entire nuclear programme. Moreover, the serious economic and industrial consequences of the destruction of oil infrastructure and the difficulty in maintaining safe passage through the Strait of Hormuz make this option complicated. In the meantime, Iran is taking advantage of these complications and hoping that the international community will prevent Israel from acting.
Meanwhile, more than 164 million people live with attacks on their streets, not knowing when the day will come when they will be targeted.
The costs of defence and attack
The repercussions of every missile launched between Iran and Israel affect the pocketbooks of families around the world. What would once have started as a regional conflict now threatens to have an immediate impact on all markets.
An impact that is beginning to be felt in Israel and Iran. While it is said that there is no better defence than a good offence, when the opponent strikes there is a compelling need to defend. In this case, defence requires far more expenditure than attack.
‘No war has ever been fought which, in the course of it, has not proved longer and harder than expected’, Winston Churchill
It is at this crossroads that the IDF (Israeli Defence Forces) finds itself right now: maintaining peace without civilian casualties.
The death toll in Gaza, as counted by the Hamas Ministry of Health, is hardly credible, but the prestigious journal The Lancet put the death toll in the Palestinian enclave directly and indirectly at 196,000, or 13% of the population.
According to the IDF itself, since the conflict began, there has been an unwritten rule that the receiving missile always costs more than the intercepted missile. This is the origin of the ‘missile economy’ conflict. It is not enough to have the best missile, but the power to maintain an arsenal large enough to meet the needs of the war.
The latest Iranian attack on 4 October has put Israel's ability to defend itself against Iranian ballistic missiles under the spotlight. While before 7-O no one questioned the military might of the Hebrew country, the impact of several Iranian missiles on Jewish territory has raised the question of how much Israel can withstand and what the price of resistance will be.
According to the IDF, the 200 missiles launched by Iran, each with a range of between 1,500 and 2,000 kilometres, are estimated to have cost approximately 1 million dollars per missile. This cost is derisory for Tehran as it is the same value as two days' worth of oil exports. Israeli defences, due to the high cost of their interceptor missiles (3 million for the Arrow-2 and 2 million for the Arrow-3), pay dearly for each Iranian attack.
The number of Israeli receiver missiles was not specified, but if one missile were to be used for every missile launched by Iran, the cost of the operation would be two times the cost of the attack by the Islamic Republic, some $450 million. An expense that will be difficult to sustain.
How much budget does Iran have?
Recently named among the 15 world powers, the Iranian army remains one of the most advanced in the region. Iranian power does not only stand out for the sheer number of missiles, but also for its battle tanks. The country's geographical position has been the basis for the growth of its military. Surrounded by mountains and with an outlet to the sea, a land invasion of Iran is always a utopian proposition.
Iran's defence budget is 24.1 billion dollars, equivalent to 2.6% of its Gross Domestic Product (GDP), while Israel's is 10 billion dollars, or 4.51%. With more than 600,000 military personnel in the army and 450,000 reservists, more than 3,000 ballistic missiles, 2,000 tanks, 550 aircraft, 120 helicopters and thousands of drones, the Iranian army is one of the most feared, above all because of the aid, in the form of nuclear weapons, that it could receive from its allies.
However, the question of the possession and use of a nuclear bomb looms over Iran. Although they do not have a concrete nuclear programme, suspicions about their possession of a nuclear weapon will always remain. Considering that it takes 25 kilograms to make a nuclear bomb, it is more than likely that they have succeeded in developing one due to the large quantities of enriched uranium that Tehran has received, mostly from its ally Russia and former Soviet republics.
Iran's potential is real and the numbers back it up, but maintaining this massive army is a pipe dream. Strangling its economy is one of the few possibilities that exist to put an end to the threat posed by Iran's military power.
What are Russia's and China's interests?
Russia and China are waiting for events to unfold, knowing that time is on their side.
China's role in conflicts in recent years has always been as a mediator or neutral actor. Despite the fact that the People's Republic has an authoritarian government that is openly allied not only with Iran, but also with North Korea, Cuba, Venezuela and Eritrea, China is a state that watches over global stability and the search for dialogue that brings peace closer and avoids the escalation of conflicts. In its struggle with the United States to be the world's leading economic power, the Chinese economy is the first interested in the stability of the Middle East.
As a good ally of Iran, China has taken it upon itself to buy 92 per cent of Iran's oil since the outbreak of the conflict following the Hamas attacks in Israel on 7 October 2023. However, in turn, China - and Russia - have a mutual defence agreement with Iran, so if the conflict progresses, Beijing will be drawn into the conflict it so desperately wants to stop.
On the other side is Russia. Embroiled in a crusade against NATO over the invasion of eastern Ukraine, Moscow has taken part in the war against Israel, both directly by providing Iran with enriched uranium and drones, and indirectly by not condemning Hamas terrorist attacks on Iranian territory.
Russia, unlike China, has shown a more bellicose character. With several threats to the West, Russian diplomacy is a major stakeholder in the conflict moving forward. An escalation in the Middle East would allow the Russian military to use more powerful weapons on the Ukrainian frontline.
Like Iran, Russia is a sanctioned country that is also avoiding collapse by buying raw materials from China, mainly steel, oil and timber. The feedback loop of the three countries, also known as the ‘iron triangle’ or ‘axis countries’, is total and focused on overthrowing, not Israel, but its enemy 9,437 kilometres from the Hebrew country: Washington.
How much are Israel's allies willing to spend?
Clashes with Hezbollah in Lebanon, Hamas in the Gaza Strip, the Houthis in Yemen, Syria and Iraq, and the Ayatollah regime in Iran are costing Israel's defence. The West, aware of this, has approved more than 20 billion dollars in military aid, mainly from the United States and Germany, which, since 7 October 2023, have donated 17.9 billion dollars, or 88.3%.
Since 1959, Israel has been the West's security protector in the Middle East. This is why Washington has provided more than 251 billion dollars in military weapons since then. Since the conflict began, aid to Israel has been increasingly questioned.
‘Costly wars not only bleed nations, they also ruin their economies’, George Washington
The use of US heavy weaponry in the IDF's various special operations has been a constant during the fighting in the Palestinian enclave and, now, in Lebanese territory. But it was only last July that the International Court of Justice asked Israel's allies to suspend trade and investments that contribute to, according to the Court's official document, ‘the Israeli occupation’.
The deaths of more than 40,000 people in the Strip, the forced mobilisation of more than 2 million and the thousands who are homeless are beginning to resonate in European circles. But it was not until polio broke out in the Palestinian enclave that awareness began to be raised.
Despite the request, member states are unlikely to stop sending military equipment to Tel Aviv. However, leaders such as Emmanuel Macron, President of the French Republic, have advised that the arms shipments be halted. For the time being, however, arms shipments are not expected to stop arriving on Israeli soil.
How will the US elections affect Israel?
As Israel's main partner, the US, and everything that concerns it, is key to the conflict. An escalation of the conflict could completely change the polls and thus the naturalness of the war.
Although the current crisis was triggered by the massacre perpetrated by Hamas terrorists on 7 October, the still US president, Joe Biden, has - at least until now - never been able to influence Israel's response to be proportionate and all plans for a cessation of attacks have ended up in the doldrums.
However, Israel's invasion of Lebanon, on the orders of Israeli Prime Minister Benjamin Netanyahu, has put the Biden Administration's position, now that of Democratic candidate Kamala Harris, in jeopardy. The always friendly US position towards Israel presumes that it will have to support it even if an all-out war against Iran is unleashed, precisely because of the closeness of the elections.
In the opposite corner is Donald Trump, Israel's main supporter and a symbol of peace since the signing of the Abraham Accords. In contrast to the conflict in Ukraine, the Republican candidate has always defended the maintenance of aid to Israel under the slogan ‘let's do everything possible to defend their homes and their people’.
In any case, what happens in the coming weeks will not only be decisive in the White House elections, but will also mark the fate of the families who have lost everything in the conflict.
Meanwhile, 370 days later, the conflict between Iran and Israel continues to rage, leaving its mark on global trade. War, while not making the victors richer, makes the vanquished poorer. Every drop of blood spilled, shell, bomb or weapon fired will be wasted resources and economic sacrifices that will only result in more instability.
In the end, war is only an evil that dishonours the human race. Conflict will leave no victors, but the deaths of hundreds of thousands of people. The reality is that each attack not only destroys infrastructure, but also mortgages the well-being of families who, although not involved, are the main ones affected.