Dunkirk was a wonderful movie that chronicled the desperate plight to get the mostly English soldiers off mainland Europe and back home to the UK. Germany had outfoxed them, and the destiny of a country truly hung in the balance. The UK owned the seas and were able to summon enough boats to get their army out of harm’s way, but it was one of many signals that the 19th century’s dominant world power was no longer the 20th century’s. There had been other signs including going off the gold standard in 1931.
The sun never sets on the British empire was a common saying back then, but the end of their empire was due to a familiar spot on the trade map: the Red Sea. There is a great YouTube video by Epic History regarding the Suez crisis of 1956. I encourage you to watch it. I will summarize it first but then it is incredible how similar the setup is to today. In 1869, the Suez Canal was completed. It was a 120-mile-long waterway connecting the Mediterranean Sea to the Indian Ocean by the Red Sea. This saved ships a 5,000-mile journey around Africa. Developed by Ferdinand Le Lesseps of France, the French and British owned the company that ran the canal despite the canal itself being owned by Egypt. This was built pre machines and was largely built by manual often forced labor in the hot desert sun of Egypt. Estimates vary regarding how many died from a few thousand to Egyptian ruler Gamal Abdel Nasser’s claim of 120,000 deaths. The canal opened under French control in 1869, largely because the British had control of the seas and didn’t need it. After the panic of 1873, the British were given an opportunity to buy 44% from Egypt and they pounced on it. It would become Britain’s key cog in its worldwide naval power and shipping dynasty. The French and British would hold control during two world wars and control much of the world’s shipping traffic.
The United Kingdom was the world’s superpower before World War II. However, after the strenuous and costly war the country was in financial hardship. Smelling weakness, the previously governed territories of India, Burma and Pakistan declared their independence in 1947 and there were revolts in Malaya, Kenya and Cyprus. Egypt’s King Farouk had made a deal allowing British military bases in Egypt until 1956, but the Egyptian people were stirring. They were angered that Israel had become a nation-state, and they were disappointed in the Arab-Israel War afterwards. Egypt’s people which had independence were also looking for a way to kick out the French and British troops out. This all changed when the Free Officers Movement came about in 1952 by military coup and kicked King Farouk out. Gamal Abdel Nasser was the new leader, and he was a disruptor and popular. He played the new superpowers of World War II against each other as both the US and the USSR were eager to build ties with a country of such geopolitical significant territory.
Then the most predictable thing in Middle Eastern politics happened. Israel attacked Gaza killing 38 Egyptian soldiers, yes, the same Gaza Israel is fighting over today. Nasser was committed to rebuilding the Egyptian army. Nasser bought a large supply of weapons from communist Czechoslovakia and solidified his growing ties with USSR. Nasser was in talks to have the British and Americans help to finance the Aswan dam project, damming the Nile River. A project that would have produced electricity and jobs throughout Egypt. After the weapons purchase from the communists, the Brits and Americans withdrew their support for the dam.
In response in July 1956, Nasser announced Egypt would nationalize the Suez Canal Company. It was seen as legal as the shareholders would be bought out, but they were unwilling sellers. He would fund his dam project with canal profits. The fight was now on. The Brits needed the oil that they transported through the canal, needed it desperately as they had an economy far bigger than their production capacity, just like Germany today with Russia and natural gas. British leader Anthony Eden condemned the attack saying Nasser “had his thumb on our windpipe.” He and Guy Mollet the French Prime Minister decided to seize the moment and attack Egypt and take back control of their canal. The Americans were against a direct attack on Egypt thinking that this would drive the Arab world to communism and the Soviet Union and Eisenhower was running for reelection. Today Biden is telling Israel not to attack Gaza any further because that might hurt his chances for reelection. Unfortunately, Israel didn’t listen and killed a top Iranian commander last week in his embassy in Syria. This is outrageous and now Iran is threatening to blow the whole region up into conflict. Well this was the plan of the British and the French, but in October 1956 Israel attacked Egypt and took control of regions that allowed a ground force to barrel across Egypt. Israel claimed that they were attacking in self-defense. Britain and France claiming to be acting on behalf of the international community and conveniently told both sides to stop fighting and withdraw from each other and move away from the Suez Canal. Israel did and Egypt didn’t. The French and British began aerial bombings at once. The French and British had teamed up with Israel to attack Egypt in secret and this was exactly what happened. Israel was advancing across Egypt while European air raids continued. The French and British dropped paratroopers and began taking over key areas and formal troops began landing on African soil.
Now this is where the story begins to turn. Up to now the French, British, and Israelis had been sneaky and attacked Egypt in response to Egypt not recognizing Israel as a nation-state and buying weapons making them a threat in the region. The French and British were two declining powers and eager to hold onto key remnants of their retreating empires. But Nasser wouldn’t go down without a fight, he sunk dozens of ships in the canal effectively blocking the shipping route. Doesn’t this sound like the playbook the Houthis are using to control the shipping through the Red Sea? It is such a key yet compact area that the Houthis are using Nasser’s playbook almost 75 years later. They are not sinking ships themselves but using missiles.
Also using the same playbook is the United Nations. What appeared to be support for Israel after the October 7 attack by Hamas has quickly see Israel indiscriminately bomb and kill thousands of civilians in Gaza. This has not gone unnoticed by the world community and then such as now the world turned against Israel. Last week, Biden and Netanyahu exchanged words and Pelosi even floated the idea that Israel might have to do without US aid. Boom, Israel started withdrew Brigade 98 from Gaza, which some saw as a withdrawal. However, some in Israel are calling for no retreat at the risk of losing US support. National Security Minister Itamar Ben-Gvir threatened to leave the government if the IDF did not enter Rafah or if it prematurely ended the war according to Tovah Lazaraoff in the Jerusalem Post on Monday. Israel seems to have forgotten its place, and they are not nearly strong enough to be acting unilaterally. Without the arms of the US, they are the barking Chihuahua in the desert, one that might receive a severe and possibly fatal beatdown due to their own hubris. Netanyahu might realize the US is serious, but his countrymen do not seem to. The US and President Biden have said they will not support such an invasive operation in Rafa due to the possibility of civilian casualties. Biden can not, repeat can not, have the price of oil go any higher and still win the election. He knows this and the price of a barrel of brent crude is over $90, which has caused gas prices to climb 60 cents in three months. If Israel decides to go alone and oil spikes, the US could withdraw their support. If that happens the Arab world could turn on Israel in half a dozen directions and the direction of history could be changed in the Middle East forever.
Speaking of forever, so did the British and French forces take the canal back and help Israel to take over part of Egypt? Not exactly, the two new young superpowers stepped in and flexed their muscles. The Soviet Union and United States both condemned what was happening with Soviet Leader Nikita Krushchev threatening to nuke Paris and London. This is only 11 years after America did nuke two cities in Japan. This was a real threat. The Americans felt the British had went behind their back as an ally and without tacit approval of their new benefactor who had come to their rescue in World War II. With the Soviets and Americans united, the United Nations were poised to put sanctions on the British government and the currency crashed. President Eisenhower wouldn’t allow any IMF aid to bail out the British economy until they agreed to a cease fire and even threatened to sell British sterling bonds into the market.
Faced with the threat of his nation going bankrupt and unable to import fuel or food, Eden blinked and only two days after landing in Egypt, he abandoned the fight. The French followed suit and Israel would over the coming months high tail it out of Sinai at the behest of the Americans. The Soviets and Americans had flexed their muscles and the French and Brits were forced to back down, humiliated and no longer a superpower.
Today the Afghans have just kicked us out of their country ensuring our humiliation and the Houthis have made a mockery of Operation Prosperity Guardian and now they control the Red Sea, so what are we to do? We are trying to make sure the tensions in the Middle East do not continue to escalate lest we become engaged in another conflict. We are still financially supporting two of them and a third awaits us in Taiwan as just today Janet Yellen told China that the US could impose sanctions on Chinese banks if they supported the military efforts of the Russians. Secretary of State Anthony Blinken said last week that Ukraine could be the next member of NATO, not remembering that Putin said he would nuclear arms if that happened. I fear our idiotic leaders are stumbling face first into a Suez type crisis of our own where it might be we, the US that leaves with second rate power status because of our own hubris based on our past and not current exploits.
I see the gold price and all I read is that the Eastern central banks are buying up the gold and draining the exchanges in New York and London of the shiny metals. Gold prices are going to all-time highs when interest rates are high, which isn’t supposed to happen, especially real rates which are positive. Something is brewing under the surface, and I fear that the Middle East might be a spark, but we might end up being the ones on fire. We have unprecedented debt in this country right now and Treasury auctions which keep getting larger by the week, and China owns a lot of our debt. Should they threaten to sell our bonds onto the market and our interest rates spike like the UK gilts did during the poor Liz Truss fiasco, then the US might be kneecapped much like we did to the British. I can guarantee you that the Chinese and the Russians are students of history. With a debt-soaked system such as ours telling them what to do, it might be they that tries to flex on us.
Sincerely Yours,
C Thomas Printer
On this date in history… 99 years ago to be exact, F. Scott Fitzgerald published The Great Gatsby, a novel about the overindulgent America of the 1920s.
Also born on this date… the great bridge player Egyptian Omar Sharif, who also happened to win two Golden Globes and be nominated for an Oscar for his role in Lawrence of Arabia.
Thank you for listening today and you can find all of our articles and more on our website cthomasprinter.com.