Treasury Secretary Scott Bessent made an announcement today, unveiling increased sanctions on Iran and also (possibly -- there were few actual details given) on countries which still do business with Iran. It was billed as being a tough declaration of economic warfare (he called it "D-Day"), but what is pretty obvious is that in reality it was an admission of military defeat.

Donald Trump was convinced, at the start of the war, that it would be a quick and easy victory for America. We'd bomb them, their government would collapse, and after a quick regime change there would be moderates in charge of the country who would be a lot friendlier to the U.S. and eager to relinquish their nuclear material and declare peace. Obviously, that didn't happen. So we kept bombing.

Since then, we have gone through periods of all-out attack, dropping bombs like rain upon Iran, interspersed with periods where either ceasefire negotiations are taking place or a shaky ceasefire pronounced. Throughout it all, Trump amped up his threats from merely bombastic to absolutely apocalyptic, threatening to destroy Iran's entire civilization. He bragged that the Iranians were absolutely desperate to cut a deal.

Somewhere along the way, the world (and Iran) stopped paying much attention to Trump's outrageous threats of imminent destruction. It became painfully obvious that the Gulf allies were holding Trump back, and even if they weren't, the American military was running out of defensive interceptor missiles. We are now in a position where we can't afford to start bombing Iran again, because sooner or later we're just going to run out of those interceptors. Trump can bluster all he wants, but the reality of the situation is that his hands are tied.

This has forced Trump to try a new tactic. With all his usual overblown rhetoric, last week he threatened to unleash economic warfare ("D-Day") on Iran and everyone who was still doing business with them. This is quite obviously a sign of weakness, since economic sanctions are a big step down from attempting (once again) to bomb them into submission. Being Trump, he tried to make it all sound as apocalyptic as he could, but it was all nothing more than an admission of the failure of the military effort.

As usual with the Trump administration, what was actually unveiled seemed hastily thrown together and awfully light on details:

The Trump administration has billed the effort as the coming of an economic apocalypse for Iran. But the announcement on Monday did not make clear how the measures would further disrupt Iran's economy or whether they would be severe enough to get Iran to end its nuclear program and allow oil to move freely through the Strait of Hormuz.

The big unanswered question is whether this will eventually mean sanctions against the major countries that still trade with Iran, including Russia, India, and China. China, in particular, is the biggest buyer of oil from Iran, but our ability to levy sanctions on China is limited (since their financial system is largely independent of the U.S. dollar). Trump is set to meet with Xi Jinping next month, and Xi has shown previously that he is not afraid of fighting back against Trump's economic threats. Even Bessent had to admit that today's announcement was more of a warning shot that he hoped would lead to a period of "quiet diplomacy" around the world. Bessent would not directly confirm that Chinese banks would be sanctioned, which suggests how limited our leverage may prove to be.

Iran appears content, for the time being, to continue playing the waiting game. They know full well that the American midterm elections are a little more than two months away, and as long as the price of gasoline stays high Trump might suffer a monumental political defeat. The new economic sanctions are probably not going to change that equation much, at least before Election Day.

Iran also appears to be nearing an agreement with Oman that would formally set up a system where the two countries would essentially charge tolls to every ship passing through the Strait of Hormuz. This more than anything else is the clearest sign that America is losing this war, since such a system simply did not exist before the war started. It will provide Iran with a source of revenue, but more importantly it will show the world that America cannot protect what used to be an international waterway which was open (and free) to all.

So far, Iran has mostly followed America's lead in the decision of when to wage war militarily. If we aren't bombing them, then they aren't shooting missiles and drones at the Gulf states or American military bases in the region. That may change with the introduction of the new sanctions, though. Iran could decide to retaliate militarily, which would further deplete our interceptor stockpiles. America may wind up following their lead on when the shooting war starts back up again, to put this another way.

Trump and Bessent are desperately trying to increase pressure on Iran, but even if this effort turns out to be successful, it will likely only push the price of oil on the world market higher (if Iranian oil disappears from the marketplace, the world's supply will shrink and prices will go up as a result). So there may be economic blowback in America (and the rest of the world). Not surprisingly, Bessent made no mention of this today.

No matter what happens, today's announcement is an admission by America that our military has failed to achieve its objective in Iran. We bombed them, but not into submission. They still retain the ability to shoot missiles and drones at ships passing through the Strait of Hormuz, even after all the American attacks on their military. Trump has even given up issuing new apocalyptic military threats, either because nobody believed them anymore or because the Pentagon informed him of how dire the situation with the interceptor stockpiles has gotten. Trump is now reduced to waging economic warfare because he has largely run out of options to do so militarily. More than anything else, today's announcement was an admission of this defeat.

-- Chris Weigant

Follow Chris on Twitter: @ChrisWeigant