Even if the United States backed out, Israel and Iran might continue to trade fire. And Israel also has Lebanon its Hezbollah front they are engaged in. Trump is deploying Navy, Air Force, Marines and Army assets even as he talks about some kind of deal. He did this in the earlier assault as well when saying a deal was imminent. Given the stock manipulations, it is possible this is just a way for some to extract billions on the market. No one will be held accountable for this.
The most recent call-up is for 3,000 Airborne troops. The debate among MAGA is the most ferocious between those are are super pro-Israel and those are not. Even for this supporting Israel's right to exist are not comfortable with a potential war with Iran. At the moment, Republicans are staying away from that term but eventually the public will make them pay if there is no support writ large for action.
In Canada, higher oil prices will mean higher royalties in oil producing provinces. Alberta and Saskatchewan may see their deficits end. Industrial provinces like Ontario might suffer with higher energy prices. However, it may also drive a movement in the U.S. to sign a free trade agreement, especially if there is a recession south of the border as a result of chaos from the war. The stock market keeps thinking Trump will chicken out at some point on Iran but he may have stirred the pot too much for it to cool down right away.
Israel's Prime Minister does not want the war to end. Netanyahu wants to occupy southern Lebanon as they once did from 1982 to 2000. Most Israelis tired of the endless stream of deaths of Israeli Defence Forces there. However, there have always been elements of Israeli religion and politics that has pushed for a larger Israel. The religious Republican Mike Huckabee who is the U.S. Ambassador has plainly said he supports a greater Israel that includes large portions of Lebanon, Jordan, Syria and further afield. Israeli cabinet ministers have suggested that even Turkey is a threat that needs to be dealt with. It is unhinged.
There has been a lot of talk about Israel directing U.S. policy in the region. Netanyahu has wanted America to crush Iran, even occupy it. And all the while this is going on, Netanyahu says a war is not right time to change the draft rules for Orthodox Jews. This must be frustrating to those Israeli forces who actually do the fighting. Some of citizens of both Israel and the U.S. believe the wars are distractions from other political issues that could put Trump and Netanyahu in legal troubles.
Canadian military forces in various areas of the Middle East that are facing aerial attacks have been moved back. The Strait of Hormuz supplies only a small part of energy needs of North America. However, oil prices are world prices so the supply lost in the choke point of the Persian Gulf means even Canada can't shelter from the price jolt. In Winnipeg, gas has risen to $172.9. The result is impacting energy process across the board as airlines jack rates up 20%.
Sadly, the decline in inflation in February (much from gas prices dropping) have all but disappeared. The Bank of Canada will have some big decisions on interest rates. Raising them could result in a deep recession. Lowering them could raise inflation higher. Keeping them the same might do nothing. A world-wide recession and high oil prices hit everyone.
All the Carney moves on expanding trade are going to be needed as oil prices may be higher than the beginning of the year just because of damage already to oil infrastructure. And that is if the war ends this week. Going into two months and there will be real downturns everywhere as well as rationing and outright power outages. It is impossible to read anything from Trump's proclamations. Netanyahu is pretty much begging him to go to a ground war and occupation of Iran. He knows that if the U.S. shuts down aggression, he will not be able to continue attacks against Iran. And support for his push into Lebanon might be squelched.
So how do the rest of us survive all this? Well, there is no escape from high gas prices. The bigger your vehicle, the bigger your commute, the more you feel it. The stock market is also where people feel it as it is mostly down. For those who depend on the markets for pension income, it can be nerve wracking. If gas is high, diesel is worse which means trucking and rail is highly affected and price increases will be passed on to all consumers on everything shipped. Already air travel is seeing energy fees being applied. This spring break travel might be the last big travel period before we see people seriously consider not travelling by car or by air if it is too expensive. In Winnipeg, young people will be free on Transit as of July 1. It will be a huge cost savings.
Cost of living has been an issue even before this crisis but now we appear to seem to have to worry about stagflation, inflation and stagnant economy. The Carney government is headed into year two and has been trying to diversify the economy. They have managed to get agriculture goods moving again to China and energy to India. It has been tough because each negotiation comes with pros and cons. Some critics say we should not be trading with India and China because of human rights and foreign interference. Some critics don't even want us to have a trade relationship with Europe. It leads to some impossible standards to upkeep. The point is the government needs to proceed with caution. Based on the world situation, we can't be overly reliant on any one country. And that is what we have been doing with the U.S.
On a personal level, people in Winnipeg really need to look for gas cheaper than the other guy. While some people complain about prices, they often shop at Shell and pay the highest price. Ditto for groceries. Looks for best prices to try and get some competition even with the supply issues. If there was ever a reason to to shop around, it is now. Canadians have already shown they will change their purchasing and travel decisions when it comes to the U.S. so they will have to do that at home to seek out best prices. It may be the best year to do a vegetable garden or insulate those house.
Large regional wars and conflicts in the past have resulted in rationing and some countries are already doing that with rotating blackouts and curfews. Canada has enough energy supply to not see that but that doesn't mean it won't get expensive with the world price. Some airlines are reporting they may go bankrupt. Some will shut down flights even for areas not affected by the conflict. It is hard to see how this will hit Canada.
If inflation does rise, this is where it will really hurt. Even an end to the war now will take some time to settle. Inflation could be around all year. The federal banks will have to raise interest rates to combat inflation. Housing prices might sink fast causing both positive and negative impacts. Housing prices need to come down but the suddenness of it might have people just leaving keys in the mailbox.
So the question is: How do we survive a war we didn't start, are largely not involved in but have world implications? Very carefully. If things get bad, expect that Canada begins a program to support the Canadian economy, avoid being part of the problem of aggression but possibly a solution for trying to deescalate. What that will be is hard to say. It just doesn't seem like this will end quickly.
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