War Widens as US, Israel, Iran Step Up Strikes Across Region

Summary

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Podcast Summary: Balance of Power

Episode: War Widens as US, Israel, Iran Step Up Strikes Across Region
Date: March 3, 2026
Host: Bloomberg – Joe Mathieu & Kailey Leinz

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Overview

This urgent episode of "Balance of Power" delves into the rapidly escalating conflict across the Middle East as the US and Israel launch successive strikes against Iranian targets. Against a backdrop of shifting justifications and political messaging from Washington and its allies, correspondents unpack the administration’s rationale for military action, the question of Iran’s remaining nuclear capabilities, and the broader risks for both regional stability and global markets. The conversation features in-depth insights from journalists, policy experts, and political figures, punctuated by notable moments from President Trump, analysis of asymmetric warfare, and political reactions from both sides of the aisle.

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Key Discussion Points & Insights

1. Mixed Messaging and the Attack’s Justification

• New Justification Emerges:
  Within the last 24 hours, President Trump claims preemption was necessary as "they were going to attack first," referring to Iran’s supposed imminent threat (02:53). This represents a shift from initial strategic justifications and draws skepticism from both lawmakers and the media.

  • Quote, President Trump (paraphrase):
    "If we didn’t do it, they were going to attack first… I might have forced Israel’s hand." (18:36)

• Lack of Specificity:
  Jamie Tarabay (Bloomberg, National Security) notes the administration’s fluctuating objectives, comparing the evolving situation to U.S. actions in Iraq and Libya while highlighting the lack of precision in official statements (03:00).

  • Quote, Jamie Tarabay:
    "The two words that just jumped out at me…they were going to attack first… What does that mean?" (02:53)

• Skepticism in Congress:
  Lawmakers like Senator Tim Kaine and Senator Mark Warner publicly refute an imminent threat, citing access to classified information and urging transparency from the administration (05:11).

  • Quote, Senator Tim Kaine (as cited on air):
    "I can state plainly there was no imminent threat from Iran to America sufficient to warrant committing our sons and daughters to another war in the Middle East." (05:11)

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2. The Nature and Sustainability of Military Operations

• Entrenched Iranian Defense:
  Tarabay emphasizes Iran’s regime is not easily toppled, with its deeply entrenched religious and security apparatus distinct from Iraq, Libya, or Syria. Protests lack armed backing, and suppression has been brutal (07:49).

  • Quote, Jamie Tarabay:
    "This is not one person, this is an institution… if the first 1, 2, 3, 4 layers are eradicated, there is still more to come…" (07:49)

• Drone and Missile Challenges:
  The U.S.-Israeli strategy faces a test of sustainability as low-cost Iranian drones overwhelm expensive U.S. defensive systems, raising questions about the long-term viability of current military responses.

  • Kelly Grieco (Stimson Center):
    "There is a real issue here in terms of the sustainability of cost… We don’t really have a lot of low cost sustainable options at the moment." (22:36)

• Resource Strain and "Forever Wars":
  The U.S. military is stretched thin across multiple theaters, prompting worry about opportunity costs and long-term impact on resources, morale, and families (11:52).

  • Tarabay on previous wars and military strain:
    "We are still feeling the effects of [Iraq and Afghanistan]… these forever wars have now been forgotten wars." (11:52)

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3. Impact on Markets and Global Trade

• Market Volatility:
  Alexandra Semenova (Bloomberg Markets) charts risk-off sentiment, massive sell-offs, and oil prices surging. She underscores that a sustained increase in oil above $100/barrel could trigger broader economic pain (14:59–16:45).

  • Quote, Alexandra Semenova:
    "Much of this has to do with soaring energy prices, casting a doubt on the ability of the Fed to cut interest rates…" (15:25)

• Strait of Hormuz Security:
  With Iranian capabilities targeting transit routes, the ability of the US and allies to keep energy supplies flowing—especially in comparison to difficulties encountered with the Houthis in the Red Sea—is deeply uncertain (26:03).

  • Grieco (Stimson Center):
    "If you want to protect commerce in the Strait of Hormuz… those same missile defense ships are not going to… provide coverage for carrier strike groups… These trade offs… are acute and we can’t escape them." (26:37)

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4. Nuclear Concerns and Congressional Oversight

• Unresolved Uranium Risk:
  Rep. Bill Foster (D-IL), the only PhD physicist in Congress, stresses the critical unresolved issue of Iran’s 60% enriched uranium, warning it could be quickly weaponized unless tracked and secured (31:03).

  • Quote, Rep. Bill Foster:
    "The fact that we’ve obliterated their factories… doesn’t mean much unless we have destroyed or seized… the inventory of 60% enriched material." (31:03)

• No Evidence of Imminent Nuclear Threat:
  Foster and others express concern about lack of evidence for an imminent nuclear threat and criticize the administration for bypassing Congressional authorization (32:55).

  • Foster:
    "I have not seen it… There had no indication this was intended to be a decapitating strike, a clear act of war… That was a breach of our Constitution." (32:55)

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Notable Quotes & Memorable Moments

| Time | Speaker | Quote or Moment | |--------|--------------------|----------------| | 02:53 | Jamie Tarabay | "The two words that just jumped out at me during this sort of this press availability was that ‘they were going to attack first.’ And I don't even know what that means..." | | 05:11 | Sen. Tim Kaine (read) | "There was no imminent threat from Iran to America sufficient to warrant committing our sons and daughters to another war in the Middle East." | | 07:49 | Jamie Tarabay | "This is not one person, this is an institution… there is a chain of command and if the first 1, 2, 3, 4 layers are eradicated, there is still more to come." | | 11:52 | Jamie Tarabay | "These forever wars have now been forgotten wars. So I really think that we need to remember because we can only learn from history." | | 22:36 | Kelly Grieco | "There is a real issue here in terms of the sustainability of cost, particularly if you’re going to use exquisite systems to intercept these relatively low cost Shahed drones." | | 32:55 | Rep. Bill Foster | "I have not seen [evidence of an imminent threat]... That was a breach of our Constitution." | | 39:03 | Jeannie Zaino | "This is about as clear as mud, and that is what makes it, it so incredibly dangerous." |

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Key Segments & Timestamps

• 00:32: Scene-setting; immediate reactions to shifting justifications coming from the Trump administration.
• 02:53–07:49: Jamie Tarabay on administrative rationales, Congressional skepticism, and the depth of Iranian regime stability.
• 10:45–11:52: Discussion of drone warfare, cost, and the risk of drawn-out military commitments.
• 14:59–16:45: Alexandra Semenova analyzes market turmoil, energy price shocks, and comparisons to past Middle East crises.
• 18:36–21:02: President Trump’s Oval Office remarks, white house reporting by Tyler Kendall on narrative inconsistencies.
• 22:36–28:43: Interview with Kelly Grieco on missile math, sustainability of defense, and the multipronged security dilemma.
• 31:03–36:45: Rep. Bill Foster on nuclear vulnerabilities, the need for congressional authorization, and oversight failures.
• 38:25–42:00: Political panel (Rick Davis & Jeannie Zaino) debate mixed messaging and the real risks.

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Tone & Language

The tone throughout is analytical but urgent, reflecting the high stakes and continual evolution of both military and political strategies. The hosts and guests consistently challenge official narratives, rely on expert testimony, and mirror the uncertainty permeating the administration’s communication.

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Conclusion

This episode stands out for its interrogation of official rationales behind the widening war, the sustainability and wisdom of current U.S. and Israeli strategies, and profound questions about the future of Iran’s nuclear program and regional stability. Guests emphasize the dangers of ambiguous objectives—a recurring theme that leaves policymakers, markets, and the public bracing for further escalation with no clear end in sight.

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Transcript

[A]

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Bloomberg Audio Studios Podcasts, Radio news. You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. Fascinating. Decidedly negative, but what a change in sentiment there. While the president was talking. Did he help the market? Sometimes it does help just to be present, even if you're saying things that the market doesn't want to hear. And it had been a couple of days, right? Everybody wanted to hear the president answer questions, which is why we brought you into the Oval Office for that important moment. The Chancellor of Germany barely got a word in. I'm not sure that this visit has played terribly well for him, but the president certainly made his point here. Asked again if Israel forced the hand of the United States on this, knowing that the Secretary of State suggested yesterday that that the US Found it had no choice but to act in advance of what it saw as an inevitable Israeli strike on Iran that would prompt retribution against U.S. assets. Here's the President. Just a few moments ago, we were having negotiations with these lunatics and it was my opinion that they were going to attack first. They were going to attack. If we didn't do it, they were going to attack first. I felt strongly about that. And we have great negotiators, great people, people that do this very successfully and have done it all their lives. Very successful. And based on the way the negotiation was going, I think they were going to attack first. And I didn't want that to happen. So if anything, I might have forced Israel's hand. And what is interesting, of course, is hearing from the likes of Senator Tim Kaine and others who say, well, there's no evidence to that extent. In fact, Senator Kaine had an op ed in the Wall Street Journal two days ago saying as much based on all the classified information that he no evidence of an imminent threat. It's where we start our conversation with Jamie Tarabay. I'm really glad that we can do this right now. Bloomberg Capital Influence national security reporter with us live in our Washington bureau. Jamie, it's great to see you. Before we get into some of your reporting on what the president is facing here in terms of potential regime change or not, what do you make of the framing of this essentially new justification? This is really just in the last 24 hours we've heard this.

[C]

The two words that just jumped out at me during this sort of this press availability was that they were going to attack first.

[B]

Yes.

[C]

And I don't even know what that means. And was it launching some kind of an attack on Israel? Like what? You know, just, just the sort of the lack of specificity that we're getting and like you said, the sort of the chopping and changing of the mission, the sort of the scope. We're hearing all kinds of different things. We're hearing this, you know, this is not going to be like Iraq. You know, we heard the president call when he announced that the attacks were happening on very early Saturday morning, that he called on the Iranian people to overthrow their government, saying this was a once in a generation opportunity. Now we have Secretary of State Marco Rubio on the Hill saying the mission is to destroy their ballistic and nuclear capabilities. So this is obviously a very fluid, very quickly developing situation. And the goals keep changing as well.

[B]

Well, which is an issue. And you're in the throes of this initial attack here. Indeed, we heard from Marco Rubio, the Speaker of the House suggested this as well. And other Republicans have, have been using this line. Did talking points go out on Sunday night? How is everyone on the same page with that yesterday?

[C]

You know, it's interesting that they are kind of starting to say a lot of the same things. And this isn' first time we've watched repeatedly whenever there have been briefings that are classified or closed or that they are all in lockstep. You know, they're all getting the same talking points in the same playbook. And you know, there are, you know, Republicans who are resolutely behind the president, regardless of what they hear in a lot of these briefings as well, that we really need to kind of note that as well.

[B]

Let's go back to that moment that stopped us in our tracks yesterday when we heard from the secretary of State on Capitol Hill. He, of course, had been up there briefing lawmakers. He was greeted by reporters in the hallway. Listen to what he said. There absolutely was an imminent threat. And the imminent threat was that we

[A]

knew that if Iran was attacked and

[B]

we believed they would be attacked, that

[A]

they would immediately come after us and

[B]

we were not going to sit there

[A]

and absorb a blow before we responded. We went proactively in a defensive way

[B]

to prevent them from inflicting higher damage. Had we not done so, there would

[A]

have been hearings on Capitol Hill about how we knew that this was going

[B]

to happen and we didn't act preemptively to prevent more casualties and more loss of life. He went back to that line a couple of times that, you know what? And then I'll be up here in hearings on Capitol Hill. Let's get back to Tim Kaine's op ed, quote. As a member of the Senate Armed Services Committee, Foreign Relations Committees, this is where the hearings would take place. With access to ample classified information about threats from Iran and others, I can state plainly there was no imminent threat from Iran to America sufficient to warrant committing our sons and daughters to another war in the Middle East. There you see it on your screen. If you're with us on YouTube, will the administration be compelled to provide that evidence?

[C]

There are more classified briefings happening today on the Hill. It really, really depends on the level of intelligence that gets shared by the administration with lawmakers. What really struck me about what Marco Rubio said, he said something about Iran was if Iran was going to be attacked, then we would be attacked, right? So who would be attacking Iran?

[B]

That's Israel, right?

[C]

Would Israel be doing something not in lockstep with the US Would Israel be doing this against American wishes? And, you know, I think that really speaks to the sort of the coordination and, you know, the timeline of how these decisions were made, like the idea that there was an imminent threat. Which, by the way, you know, Senator Mark Warner, who is a senior member of the Intelligence Committee, said that he has seen nothing in all of his classified briefings that has told him that there was an imminent threat. What was the imminent threat? Was it Iraq? Was Israel attacking Iran and then Iran responding by taking the U.S. i mean, so if that's the case, why, you know, then that we need to think about, well, you know, the sort of the ability for Israel to do that unilaterally and what that relationship and the alliance with the US really mean, really

[B]

something considering that we're working together on this. Jamie, you're reporting his called into question the idea. And by the way, the president acknowledged this in one of the questions. He was just asked about his worst case scenario. He said, you know, look, if somebody takes over, who's as bad as the previous person, right, that could happen, I guess the worst case scenario would be we do this and somebody takes over who's as bad as the previous person you're reporting. And what you've been bringing to the conversation is that this is different. This isn't Gaddafi, this isn't Saddam, that this isn't about a figurehead, that there is a much larger apparatus here. Which is why we're still seeing drones flying today. Right.

[C]

I mean, I think that it has been extraordinary to see that, that military retaliation, the scope and the scale of the drones and the missiles, the short, medium and long range that we, you know, we have these amazing experts at Bloomberg have been sort of laying this all out for everyone over the last couple of days. But it really tells you that a, this is not one person, this is an institution and there is a chain of command and if the first 1, 2, 3, 4 layers are eradicated, there is still more to come. And this every. I spent a lot of the time on the weekend speaking to so many intelligence people, people who have been watching and studying Iran for 40, for four, for four decades, 40 years. And, and they say that this system is deeply, deeply, deeply entrenched on every level. The security services, the surveillance state, the, that the Shiite sort of, the sort of the religious council has on the country. This isn't something that is going to be easily wrested from power in the way that people are hoping it will be. I mean, one of the biggest differences between what happened in Syria or in Libya or in Iraq is, number one, in Iraq, ground forces. US Ground forces launched an invasion with their international allies. And what happens after that was you saw an abandonment by the Iraqi army of their duties. Right. So that's number one. That is really unlikely to happen in Iran if there aren't ground troops. And we're already seeing casualties on the US Military side. I don't know how long that is going to be sustainable and maintain political will for that to continue. And even with the idea that ground troops is not going to be sort of ruled out, there is still so much political cost that comes with that. Syria was a decade in the making and again, armed forces ousted this regime. So, you know, the protesters in Iran, as we saw in January when these protests were like brutally, brutally suppressed, they don't have weapons, they're not armed. So for them to come at this, this heaving force. I was speaking to an Israeli general yesterday who ranks the numbers in at least a million. You know, security forces, revolutionary, paramilitary. It's a lot for these people to come up against. If one of those Forces choose to switch sides, there may be a chance, but outside of that, this is a really remote possibility, especially in the short term.

[B]

Well, as someone who's done extensive reporting from, from war zones, Jamie, is there any way to get to these hundreds of thousands of drones to discover them, to secure them, or to find the highly enriched uranium without having actual human beings on the ground?

[C]

I'm based off everything that we saw with Iraq and the search for weapons of mass destruction. I would say no. The drones are definitely a new calculus. We're seeing. They fly low, they fly fast, they're impossible to get. All of them, at some point think people are expecting the Iranians to run out, but the damage that they will inflict before then is something that I think we will all be watching for a while. And it's obviously providing a lot of uncertainty and instability to all of the allies in the Gulf as well. I mean, staggering numbers, drones.

[B]

I mean, if we're going to shoot $1 million missile at each of these things, we got a lot of money to spend and a lot of missiles to buy. Just lastly, before you go to that end, what did you make of the President's post this morning? The Forever Post. He used the word forever. The United States munitions stockpiles have at the medium and upper medium grade, never been higher or better. As was stated to me today, we have virtually unlimited supply of these weapons. He writes, wars can be fought forever and very successfully using just these supplies. When does this logic run into some headwinds?

[C]

One of the things that I think is really important in moments like this is opportunity cost. And we spent a lot of time in Iraq and Afghanistan at the cost of developing weaponry or saving our resources, saving our blood, saving our treasure, while China, for example, was developing and enriching and militarizing. So if the dedication of these resources here for something that doesn't seem particularly like threatening versus what people have described as an imminent threat in the Pacific, for example, especially regarding Taiwan and especially with the support of Ukraine. I question that. I also question the, the sort of, the determination to maintain so many different fronts and so many conflicts and the drain that will have on our resources. The buildup in the Mediterranean and in the Gulf is as big. Don't forget, we also had the same situation in the Caribbean. So that's a lot of strain on the military. And there's families, there's veterans, there's injuries and wounded. And just the sort of, the ripple effect that I witnessed coming out of Iraq, we are still feeling the effects of that today the Iraq and Afghan veterans are still dealing with these things and they have become these forever wars have now been forgotten wars. So I really think that we need to remember because we can only learn from history.

[B]

I'm so happy that you could spend some time with us today and keep your eyes on the terminal and the website for Jamie's great reporting. Jamie Terabay, Capital Influence National Security and find more from [e-mail] Stay with us on Balance of Power. We'll have much more coming up after this.

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You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android with the Bloomberg Business app Listen on demand wherever you get your podcasts or watch us live on YouTube. The barrel of crude selling for $75 a little over up $4 up a little more than 5%. West Texas Intermediate with great concerns about what type of supply interruption we could be talking about in the days ahead if that happens. It's obviously a great moment of uncertainty, but The S&P 500 has been clinging to that a 6800 level pretty stubbornly. We explore this all a bit more with Alexandra Semen over Bloomberg News equities reporter with us also live from world headquarters in New York. Alexander, what has your attention here in a day that has seen stocks recover somewhat but still huge concerns about what's happening in the energy space?

[D]

Hey Joe. Well, it is a firmly risk off day today with stocks and bonds deepening their losses since attacks began on Iran over the weekend. Definitely a stronger reaction today than we saw yesterday. About 450 shares in the S&P 500 were lower and of course the Dow dropped as much as 1200 points at some point in the trading day. Today it is worth it pointing out that the S and P did pare a significantly deeper decline at some point, falling as much as 2.5% to an October low. Much of this has to do with soaring energy prices, casting a doubt on the ability of the Fed to cut interest rates given the risk it poses to inflation. We had Fed President Neel Kashkari today at Bloomberg Invest, saying that the attacks on Iran put into doubt his call for for an interest rate reduction later this year. Now, investors are contending with some cross currents here. On one hand, if you look at past geopolitical volatility, it's typically proven to be a good buying opportunity for stocks given as long as oil prices have been contained. Now, in the aftermath of past escalations in the Middle east, The S&P 500 was higher by 2%, 6% and 8% on average in the 1, 6 and 12 month periods that followed. This is according to data from Morgan Stanley. But the big caveat at is when energy costs sustain substantially surged, the level that crude oil prices would have to reach for it to become a pain point for equities is $100 per barrel. That is the threshold that typically becomes associated with negative equity returns given it starts to weigh on consumer sentiment, on corporate earnings. We're not there yet, but investors today are signaling that they are worried that this could be more prolonged than expected yesterday.

[E]

Well, and what should we make, Alex, of the idea that we're not seeing a traditional flight to the havens that you would at least expect? Where can safety be sought right now?

[D]

That's the big question. Kayleigh and I've been asking traders that all day long and I really haven't gotten a solid answer from them because it seems to be a lot of folks trying to figure that out. Now, typically, tech used to be the safe haven trade given its strong balance sheets, but now we have all these concerns around artificial intelligence and capex spending. So that's not the traditional defensive play anymore. The common denominator that I've gotten from conversations I've had is people are looking at companies with strong balance sheets. There's been this flight to the halo trade. So looking at tangible assets, metals, kind of the, the companies that are building out AI technology versus, you know, the coders, and then also looking for companies that aren't necessarily tied to economic growth given the risk that we could get a spike in inflation if this conflict persists.

[E]

All right, Bloomberg's Alexander Semenova, thank you so much for joining us from New York. And we want to go to the White House next where again, as we mentioned just a moment ago, earlier this afternoon, President Trump was joined in the Oval Office by the German Chancellor Friedrich Mertz with the war in Ukraine and trade issues on the agenda, but first and foremost the ongoing conflict in Iran that the US And Israel, of course, is continuing to prosecute. This, this, this bombing campaign against Iranian targets, which the president contends largely have been wiped out in terms of Iran's military capabilities. But he was also pressed on this notion that we heard from the Secretary of State, Marco Rubio and the House Speaker, Mike Johnson, yesterday, the idea that Israel was set to strike first and the US Joined in out of concern that Iran was going to retaliate against U.S. assets in the region. The president suggested that wasn't the case.

[B]

We were having negotiations with these lunatics. And it was my opinion that they were going to attack first. They were going to attack. If we didn't do it, they were going to attack first. I felt strongly about that. And we have great negotiators, great people, people that do this very successfully and have done it all their lives, very successful. And based on the way the negotiation was going, I think they were going to attack first. And I didn't want that to happen. So if anything, I might have forced Israel's hand.

[E]

For more, we turn to Bloomberg's Tyler Kendall, who is live on the North Lawn of the White House for us. So, Tyler, not necessarily a consistent narrative we're getting from the president and others in his administration close to him?

[F]

No. Though, Kelly, we have heard consistently from senior administration officials starting this weekend when the attack started, that they are calling this a preemptive defensive attack, which it appears President Trump was alluding to there, despite his Secretary of State, Marco Rubio, as you mentioned yesterday, telling reporters on Capitol Hill that they were confident that Israel was going to launch a strike that would very likely mean retaliation against U.S. targets. So an interesting back and forth there, I guess you could say, as we've been working through some of those other statements from the administration, including the objectives of this mission as well as what the ultimate goal is going to be. Right. We heard from the Defense Secretary, Pete Hegseth, yesterday, saying that the original intent was not going to be what he called, quote, so called regime change, though they are hoping that the Iranian people take advantage of this moment, in their words. President Trump went on in that Oval Office meeting to talk about how what the worst thing would be was if the regime stayed in place in the same sort of era that it has been fostering. And President Trump wants to see leadership change when it comes to Iran. The question then becomes, what does that actually look like? The president had said before that there were a few options that they were eyeing that the US Felt that it could work with, but that all of those people have been killed in the strikes. That's something that we're going to be watching really closely as this ultimately develops because from an operational level, the US And Israel are continuing, are continuing their bombardment of Iran. Joe and Kelly, we got confirmation this morning from the IDF that this is now the ninth wave of strikes against the country.

[B]

Straight from the Oval Office, Tyler Kendall, Bloomberg Washington correspondent live at the White House. Tyler, we thank you and thanks for being there for that incredible conversation with the President. Here's a little bit more of a taste of what the president said about what's been accomplished in just the last four days. Listen, they have no navy, it's been knocked out. They have no air force that's been knocked out. They have no air detection that's been knocked out. Their radar has been knocked out and just about everything has been knocked out. So we'll see how we do. But we're doing, we're doing very well. We have a great military and they're doing a fantastic job. And even if that remains the case, there are great questions about our supply of munitions. With the president on Truth Social earlier today said could in fact last forever. The word that he used. We could fight forever. But there's a fascinating story on the terminal that questions Iran's missile math, as Bloomberg News puts it, $20,000 drones taking on $4 million patriots. Something we wanted to talk to Kelly Grieco about who specializes in asymmetric warfare, senior fellow with the reimagining U.S. grand Strategy Program at the Stimson Center. Kelly, thank you for joining us. As we face the prospect of hundreds of thousands more drones potentially being sent to us, to our allies in attack by Iran, there are questions about whether in fact this is the right approach or we should be using a different technology to fight them. What do you think?

[F]

Well, first of all, thank you for having me. I think you hit the nail on the head in that there is a real issue here in terms of the sustainability of cost, cost, particularly if you're going to use exquisite systems to intercept these relatively low cost shahed drones. You know, I think the United States is probably trying to not use things like its Patriots interceptors for this and holding those in reserve only when it's absolutely necessary. It's probably trying to rely on some other methods, but they're still fairly costly. Like we've seen F16s, for example, or F15s flying in the air and using anti air missiles against these. We're now seeing Apaches that are also being used in this role. Traditionally they hunt tanks, but now they're hunting jihad drones. But we don't really have a lot of low cost sustainable options at the moment.

[E]

Well, so when we consider that then Kelly, expensive as these things may be, when we consider the quantity we have of them and where they are, do we have adequate capacity in the Middle east east right now, are we going to have to be pulling these assets from other theaters?

[F]

Oh, well, I think when we combine both the missile threat, there's still the ballistic missile threat and the drone threat. You know, there's sort of a race going on right now between the ability of the United States and Israel and now seems Qatar to also to be able to find, locate and destroy the infrastructure for its missile missiles and the launchers, the drone facilities to try to destroy that so they can't get as much in the air and take off the pressure on the interceptors. But if you look at the basic math, particularly against the war, before the war, it certainly favored Iran and just sheer numbers, you know, the question becomes how effective is it being at degrading those capabilities. But the reality is even what we've done so far, we've actually gone in significantly into our own stockpiles of these interceptors. Interceptors. And the important thing to really understand is that you can use these interceptors and buy down short term risk today by using more of the inventory. But you can't remake these overnight. You can't replace them overnight. You're not probably going to even be able to replace them this year. We're talking about years to be able to replace these interceptors.

[B]

Well then I'd love for you to help us interpret the President's post on truth social, decode this for us. Kelly Grieco. He writes the US Munitions stockpiles have at the medium and upper medium grade. You could qualify that for us. Never been higher or better. He writes, as was stated to me today, we have a virtually unlimited supply of these weapons. Wars can be fought forever and very successfully using just these supplies. Is that true?

[F]

I am not sure what he means exactly by medium grade. I have a few like two different thoughts in response. One is that it is true that when you're talking about shorter range things on offense, particularly if we're able to not rely as much on long range munitions and we're able to get closer to targets on Iran you can rely on shorter range things. We have that in larger numbers. So on the offensive strikes we can sustain this for quite a while. The air defense, missile defense issue becomes much more challenging. There are just certain realities, commodities around, around those stock, around those stockpiles that we can't really escape.

[E]

Kelly, Obviously, when we're watching the markets today, we are seeing major upward pressure on commodities, oil and natural gas prices surging as we consider whether or not the Strait of Hormuz is going to be safely navigable for tankers in order to get that product and crude out of the region. Is it possible for the US Or Israeli forces to do what proved very difficult to do with the Houthis in the Red Sea and make sure that the Strait is secur for transit with the resources we have and knowing we also actively are trying to play defense with the drones and everything else that Iran is sending out right now?

[F]

Yeah, I mean, this is a very tall order for the reasons that you highlight is that we've, you know, did this earlier with the Houthis and the Houthis have, you know, also been threatening that they're going to resume their strikes as well. The question is that it's not even one threat at this point. Then, you know, one of the challenges here is you're going to have to make some acute decisions because if you want to protect commerce in the Strait of Hormuz, then those same missile defense ships are not going to be able to, say, provide some level of coverage for, you know, carrier, the carrier strike group itself or to help protect some of the ports of Gulf states. And so it's these kinds of trade offs that are just really, that are cute and we can't escape them. That's just the reality.

[B]

We understand that Iran was estimated to have about 2,000 ballistic missiles after last year's conflict with Israel. Based on what's taken place over the last four days, drones aside, Kelly, what do we think that might leave behind?

[F]

Yeah, I mean, it's a little hard to estimate because we, there's a lot we don't know. But I did see that a couple of days ago the Israelis announced that they thought they had destroyed about half the launchers. Launchers they were believed to have to about 200 launchers before the war. And so they may be down to about 100. That's still significant. Haven't heard as much about, like the stockpiles of the missiles themselves. My sense would be that, you know, we'll know over time. I think particularly the next couple of days as we start to see, you know, to what degree they're able to sustain these salvos. If we start seeing a drop off, then we can have a higher degree of confidence that we've actually managed to destroy some of this capability. But it is challenging. We're talking about trying to find things that are on trucks that can blend in. These are widely dispersed. And the Iranians were smart enough to realize that they shouldn't rely on a centralized command to control in Tehran for, you know, leading its forces. And so local commanders have been authorized to conduct these strikes. And makes it harder. It makes it much more resilient as a target.

[A]

All right.

[E]

Kelly Grieco, we so appreciate your insight and expertise. She's senior fellow with the reimagining U.S. grand Strategy Program at the Stimson Center. Here with us on Balance of Power. And we have more coming up. We'll take you live to Capitol Hill where Democratic Congressman Bill Foster of Illinois will be joining us. He's a Ph.D. physicist. Physicist. We'll talk more about Iran's nuclear program next on Bloomberg TV.

[B]

And stay with us on Balance of Power. We'll have much more coming up after this.

[A]

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[B]

IBM, you're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station.

[A]

Just say Alexa.

[B]

Play Bloomberg 11:30.

[E]

I'm Kailey Leinz alongside Joe Matthew here in Washington tracking the developments we are seeing in the Middle east as the US And Israel continue out for a fourth day strikes against targets in Iran. We know thousands at this point have been hit. The president outlining the targeting of the Iranian Navy Air Force radar systems. He said all of these things have effectively been wiped out. And this is after remember back in June of last year, the president said the US had successfully obliterated Iran's nuclear program, though there's been reporting of nuclear targets being involved in this as well. And we wanted to drill in on the nuclear aspect here as we turn to the only PhD physicist in Congress. Democratic Congressman Bill Foster of Illinois is joining us live now from Capitol Hill. Congressman, welcome back to Bloomberg TV and Radio. It's good to have you. When we consider what we do know and what we don't know about what Iran's remaining capabilities and stockpiles were after the June strike. How confident are you that we can successfully and finally obliterate it now?

[A]

Well, the key question that we have not yet heard an answer to from the Trump administration is what has become of Iran's extensive inventory of 60% enriched uranium? There is a misunderstanding. A lot of people have that unless it is quote, unquote, weapons grade, 90% enriched uranium, that it is not usable to make a weapon. But people should understand that the Hiroshima atomic bomb was a mixture of 50% and higher enriched uranium. The 60% enriched stockpile that Iran was seen to have been producing by the IEA was. You know, a lot can be done on that. And the administration has been forthcoming with us in terms of getting technical briefings. I have bipartisan requests that got answered very well and by NNSA about what exactly technically could Iran do with the stockpile of 60% enriched uranium? And it was, it was pretty much what had been predicted by a large number of pundits where they say, look, you can make a large number of a significant number, a handful of Hiroshima style devices with their 60% enriched uranium. It's a straightforward thing. The fact that we've obliterated their factories to make large inventories of weapons grade material doesn't mean much unless we have destroyed or seized or brought under inspection the inventory of 60% enriched material. And at least we have not in Congress got any accounting for where that is and what we know about it.

[B]

So has Congress also seen evidence that there was in fact an imminent threat posed by Iran, a nuclear threat to the United States?

[A]

I have not seen it. And I've talked to members of the Gang of Eight who said, among other things, that they had no indication that this was intended to be a decapitating strike, a clear act of war. And the problem for a large number of members of Congress, including essentially all Democrats, is that the Constitution provides a way that this should have happened. If the nuclear negotiations were actually stuck, then Trump should have gone to Congress, explained the situation, asked for an authorization for the use of military force, and then waited for a target of opportunity that did not happen. And that was a breach of our Constitution.

[E]

Well, I'm not sure, Congressman, it's. You still see a path forward for negotiations over the nuclear program if there is a remaining diplomatic path here. But if there were one, knowing how the President has railed against the JCPOA agreement that was reached during the Obama administration, do you see areas in which what was that agreement should be tightened, should be changed if there is to

[A]

be another one well, the thing that you have to do is to put in any agreement at this point that will be, you know, worth worth signing. There has to be a very intrusive inspection throughout all of Iran by the IAEA and other trusted authorities, snap inspections to make sure they haven't restarted it. But there is an opportunity to have a well prescribed regional reprocessing and enrichment capability that Iran could participate in. One of the interesting proposals for that is to put it on one of the islands in the middle of the Gulf that Iran owns some of them. And if you had a very well defined enrichment facility and nuclear, nuclear, essentially a pipeline for manufacturing nuclear material, but it was on an island where everyone could see what they're doing and anyone unhappy with it could flatten the place, then you could have something, a satisfactory agreement where Iran would be able to tell its citizens that our nuclear program continues and that anyone from Saudi Arabia to Israel to the United States could destroy it at a moment's notice if they found the material was being diverted and then you could have very severe inspection. So this has been proposed by Ernie Moniz, who is responsible for the, for negotiation of the Iran nuclear deal. And I think there is room for an agreement there that could meet everyone's requirements. But my biggest question at this point is they have, they have essentially obliterated the top level of leadership. One of the only positive things about the Ayatollah is he apparently had a very strong fatwa against production of nuclear weapons. I have no idea who his successors are, what his successor's attitude toward production of nuclear weapons. Because if we have not locked down or destroyed their inventory of 60% enriched uranium, they could very rapidly make a handful of devices, not small compact devices you could put on missile, but things that could be put into container freights and delivered through other means. And there's a very credible threat there that we have simply not been willing to talk about or certainly respond to.

[B]

So it sounds like in our remaining moment here, Congressman, that's your priority. Right now the United States must identify that missing highly enriched uranium that is still somewhere in Iran. Do you not believe we know where that is?

[A]

I cannot talk about it, but I will say that I personally have not been given the information to give me confidence that we know what we're doing in this area.

[B]

Really glad you could join us. Congressman Bill Foster Democrat, Illinois's 11th district as Kaylee mentioned, the only PhD physicist Congress. So we wanted to get to that nuclear issue specifically before we assembled our political panel. And they're with us Right now, Bloomberg Politics contributors Jeannie Shann Zaino and Rick Davis. She is our Democratic Analyst and Democracy Visiting Fellow at Harvard Kennedy School's Ash Center. Rick is our Republican strategist and partner at Stone Court Capital. And we've talked, Rick, about that missing stash of highly enriched uranium. Can we presume that the CIA has a good sense of, sense of where that is and how important is it to find it? Yeah, I would think the combined intelligence capabilities of Israel and the US Would have a pretty good sense and have been tracking for a long time the storage and, and location of, of that uranium. I think, you know, one of the things that you have to consider when you hear the president talking about using potentially ground troops is the ability to go and, and, and safeguard that uranium. Obviously, the only thing worse than having it in the hands of a bunch of terrorists like the Iranians is having it in the hands of other terrorists who you don't know. And so, yeah, I would think that there's got to be some kind of a war plan in effect right now, not only identifying it, but also with a couple of options on how to spirit it out of the country, because I don't, I can't imagine a scenario with this scale of activity where the US Would allow that uranium to stay in place.

[E]

Well, so, Jeannie, I'd love for you to weigh in here on this notion that we're hearing mixed messaging from the administration around what exactly the goal was or what the remaining nuclear capabilities were of Iran, if it was really about the nuclear program or about the ballistic missile program or about the Iranian navy, or about regime change. When President Trump told reporters today the worst case scenario is that someone comes in who was just as bad as the Supreme Leader. Is there enough clarity, not just coming from President Trump, but the varying members of the administration who have also been put out there to address the press right now, or do you find yourself just more confused?

[F]

More confused. And the answer to your question is absolutely no. This is about as clear as mud, and that is what makes it, it so incredibly dangerous. And I think your conversation with Representative Foster just encapsulates the danger here. They have stockpiles, potentially 60% enriched, which can be incredibly dangerous and damaging to the world. We have no evidence, as far as we have been told yet, of an imminent threat that required us to go in, and yet we took out and decapitated their leadership. And by every stretch of imagination, we have no plan in which to change this regime. And even if and when we take out this regime who gets replaced, who goes in there. They are likely to be just as hard line or more hardline than the previous regime. And so that is the problem. Then what are they doing, Kelly? They're sitting there on top of 60% potentially enriched uranium and whatever else. Moreover, they will completely reconstitute whatever we take out. And that's why this is a really ham fisted approach to doing this. And I think the reason we're not hearing clear objectives is what the Secretary of State said yesterday in Congress, which was stunning. Or to the gang of eight, which was that we went in because we were concerned that Israel was going to strike. Well, that's like, you know, me concerned that, you know, Joe is going to strike you, Kayleigh, and then you're going to strike me. So I shoot him first. It makes no sense. Particularly wait a minute, we don't get

[E]

violent here on balance of power and

[F]

you don't get violent. So I'm sorry to use you two kind folks as an example, but it makes no sense.

[B]

Yeah, I'm under fire here. Rick, I am curious to know what your thought is though on this line that we heard again from the Secretary of State yesterday and how the president responded to it. Today he was asked, did Israel force your hand? And he said based on the way negotiation was going, I think they were going to attack first. And it's, I didn't want that to happen. So if anything, I might have forced Israel's hand. We've got a minute left. Rick, how do you read that answer? I just am amazed by the lack of message discipline coming out of the administration and maybe all of the above. Right. I mean there's a lot of reasons to do an operation like this, but you have to have a very clear and consistent message to the American people as to why are we in the process of bombing this country and taking out their leadership, as you've pointed out. And look, I think it probably is some combination. But remember those ships were brought from different theaters to surround Iran. For months. This has been an effort in the progress. There's been a plan. Now that plan is being carried out.

[E]

All right, Rick Davis and Jeannie Shan Zaino, Bloomberg Politics contributors, our political panel,

[B]

thanks for listening to the Balance of Power podcast. Make sure to subscribe if you haven't already, Apple, Spotify or wherever you get your podcasts. And you can find us live every weekday from Washington D.C. at Noontime [e-mail] if you follow markets, you know the value of long term thinking. You plan, you diversify, you prepare for volatility. But even the best strategies can't prevent every bad day. For more than 75 years, Cincinnati Insurance has helped individuals and businesses navigate tough moments with expertise, personal attention and independent agents who focus on relationships, not transactions. The Cincinnati Insurance companies Let them make your bad day better. Find an agent@cin fin.com Wasabi is purpose built to free your business from skyrocketing storage costs and fees from the big guys. Wasabi is the go to provider for professional and collegiate sports teams around the world. Check out Wasabi's AI enabled intelligent media storage, Wasabi Air and the industry's only cloud storage service with triple protection against cyber criminals. Wasabi driving innovation in data storage for up to 80% less than market competition. Try for [e-mail] Wasabi Hot Cloud Storage proud partner of iHeart Podcast Network.