Who Will Collapse 1st Economically … The United States or Iran?
Published in AlRai Media
(Kuwait) on 18 May 2026
by Mohammad Abo Khudair & Zaki Abo Alhalawa (link to
original)
Against the stalemate in indirect negotiations between Washington and Tehran, and coinciding with repercussions from the Beijing summit between U.S. President Donald Trump and Chinese President Xi Jinping, tensions are rising once again in the Middle East, signaling an imminent outbreak of war between the United States and Israel on one side, and Iran on the other.
While military and intelligence circles are examining the chances that Tehran will launch a preemptive strike, economic analysts are posing a parallel question: Which of the two economies will collapse first? This report reviews analyses by leading experts in Israeli newspapers and research centers regarding the state of alert, military scenarios and economic resilience.
State of Alert and the Possibility of an Iranian Preemptive Attack
Eliyahu Yonah and Avi Ashkenazi wrote an analysis for Maariv that concluded “the current ceasefire is merely a superficial truce, as the war threatens to erupt again at any moment.” The critical question now is whether Iran is likely to launch a preemptive attack against American and Israeli targets. For this reason, as the two writers note, Washington and Tel Aviv have decided to heighten their state of alert and avoid any surprises.
This warning aligns with the view of Amos Harel in Haaretz, who goes further, describing the Israeli position as one of acting as if the war has already begun. While Donald Trump refrains from revealing his intentions — especially after returning from the Beijing summit empty-handed, having failed to secure any potential deal (Taiwan in exchange for Iran) — the Israeli government and military, through their statements and actions, are signaling readiness to resume attacks.
Iranian Preparations and the Nuclear Leap
Harel reveals more somber details in his analysis, citing retired Maj. Gen. Tamir Hayman, head of the Institute for National Security Studies and former head of Military Intelligence. Hayman, who served in the reserves at the beginning of the current war, concludes that the previous campaign failed to fundamentally alter Iran’s centers of gravity. Even more dangerously, Tehran has demonstrated a rapid and alarming ability to rebuild: it has reconstructed the Fordow nuclear site, developed the heavily fortified Jabal Makosh site, and increased ballistic missile production to 125 weapons per month.
Hayman warns that the new Supreme Leader, Mojtaba Khamenei — described as more hardline than his father, Ali Khamenei — views nuclear deterrence as the only way to prevent the coming war. This necessitates addressing the possibility of a secret project to produce nuclear weapons.
This grim assessment leads directly to the military scenario proposed by writer Ron Ben-Yishai. After confirming that the American decision will be fateful for the entire Iranian regime, he argues that the correct approach is not a lightning operation, but a broad, targeted campaign conducted jointly by U.S. and Israeli air forces. According to his analysis, although Iran has fewer than 1,000 long-range ballistic missiles remaining, strikes must target the entire missile and drone system in the Strait of Hormuz and across Iran. This would limit its ability to respond compared to previous rounds.
The Economic Comparison: Who Collapses 1st?
However, the deeper question — one that could determine the direction of the war without a single shot being fired — is economic. Here, Brig. Gen. (Res.) Dr. Sasson Haddad from the Jerusalem Institute for Strategy and Security provides a precise and complex answer. He distinguishes between the “state economy” and the “regime economy.”
On the level of the state economy, the answer is clear: Iran will collapse first, and by a wide margin.
While the U.S. gross domestic product is projected to reach $32.38 trillion with 2.3% growth, Iran’s GDP doesn't exceed $300 billion, with a contraction of 6.1% and staggering inflation of 68.9% (and food inflation reaching 99%, according to the World Bank).
Yet the paradox highlighted by Haddad — which lies at the heart of the answer to who will collapse first? — is that the collapse of the Iranian state economy does not necessarily mean the collapse of the regime economy.
The Iranian regime remains capable of funding its power mechanisms and suppressing opposition, while the United States — despite the strength of its economy — suffers from the limited political space available to the Trump administration. Therefore, the more correct conclusion is that Iran will collapse first economically and socially (meaning the Iranian people will collapse before the American people). However, it is not clear which of the two political regimes will demonstrate greater “staying power” in managing the crisis — especially as Israel seeks to weaken Iran structurally and permanently, despite the difficulty of converting military superiority into a rapid political achievement.
While military and intelligence circles are examining the chances that Tehran will launch a preemptive strike, economic analysts are posing a parallel question: Which of the two economies will collapse first? This report reviews analyses by leading experts in Israeli newspapers and research centers regarding the state of alert, military scenarios and economic resilience.
State of Alert and the Possibility of an Iranian Preemptive Attack
Eliyahu Yonah and Avi Ashkenazi wrote an analysis for Maariv that concluded “the current ceasefire is merely a superficial truce, as the war threatens to erupt again at any moment.” The critical question now is whether Iran is likely to launch a preemptive attack against American and Israeli targets. For this reason, as the two writers note, Washington and Tel Aviv have decided to heighten their state of alert and avoid any surprises.
This warning aligns with the view of Amos Harel in Haaretz, who goes further, describing the Israeli position as one of acting as if the war has already begun. While Donald Trump refrains from revealing his intentions — especially after returning from the Beijing summit empty-handed, having failed to secure any potential deal (Taiwan in exchange for Iran) — the Israeli government and military, through their statements and actions, are signaling readiness to resume attacks.
Iranian Preparations and the Nuclear Leap
Harel reveals more somber details in his analysis, citing retired Maj. Gen. Tamir Hayman, head of the Institute for National Security Studies and former head of Military Intelligence. Hayman, who served in the reserves at the beginning of the current war, concludes that the previous campaign failed to fundamentally alter Iran’s centers of gravity. Even more dangerously, Tehran has demonstrated a rapid and alarming ability to rebuild: it has reconstructed the Fordow nuclear site, developed the heavily fortified Jabal Makosh site, and increased ballistic missile production to 125 weapons per month.
Hayman warns that the new Supreme Leader, Mojtaba Khamenei — described as more hardline than his father, Ali Khamenei — views nuclear deterrence as the only way to prevent the coming war. This necessitates addressing the possibility of a secret project to produce nuclear weapons.
This grim assessment leads directly to the military scenario proposed by writer Ron Ben-Yishai. After confirming that the American decision will be fateful for the entire Iranian regime, he argues that the correct approach is not a lightning operation, but a broad, targeted campaign conducted jointly by U.S. and Israeli air forces. According to his analysis, although Iran has fewer than 1,000 long-range ballistic missiles remaining, strikes must target the entire missile and drone system in the Strait of Hormuz and across Iran. This would limit its ability to respond compared to previous rounds.
The Economic Comparison: Who Collapses 1st?
However, the deeper question — one that could determine the direction of the war without a single shot being fired — is economic. Here, Brig. Gen. (Res.) Dr. Sasson Haddad from the Jerusalem Institute for Strategy and Security provides a precise and complex answer. He distinguishes between the “state economy” and the “regime economy.”
On the level of the state economy, the answer is clear: Iran will collapse first, and by a wide margin.
While the U.S. gross domestic product is projected to reach $32.38 trillion with 2.3% growth, Iran’s GDP doesn't exceed $300 billion, with a contraction of 6.1% and staggering inflation of 68.9% (and food inflation reaching 99%, according to the World Bank).
Yet the paradox highlighted by Haddad — which lies at the heart of the answer to who will collapse first? — is that the collapse of the Iranian state economy does not necessarily mean the collapse of the regime economy.
The Iranian regime remains capable of funding its power mechanisms and suppressing opposition, while the United States — despite the strength of its economy — suffers from the limited political space available to the Trump administration. Therefore, the more correct conclusion is that Iran will collapse first economically and socially (meaning the Iranian people will collapse before the American people). However, it is not clear which of the two political regimes will demonstrate greater “staying power” in managing the crisis — especially as Israel seeks to weaken Iran structurally and permanently, despite the difficulty of converting military superiority into a rapid political achievement.
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