A Deal With Nothing Left to Trade

In a federal courtroom this summer, a government lawyer made an argument that had nothing to do with clean air. Shutting down xAI's unpermitted gas turbines, the filing said, would endanger the country itself.

threatens American national, economic, and energy security by seeking to shut off the power supply for artificial-intelligence innovation that supports the Department of War’s military operations. — United States Department of Justice

The war, in other words, is now the legal cover for the AI buildout. And the buildout is the war. The Pentagon used xAI's Grok model to launch more than 2,000 munitions at 2,000 targets in Iran within 96 hours during Operation Epic Fury ^[1].

The essential capacity to deploy data facilities at a massive scale is as fundamental to our contemporary defense strategy as conventional munitions production. — Cameron Stanley

The circle closes the other way, too. The Pentagon terminated Anthropic's government contracts in February after the company refused to let its Claude model be used for automated strikes or mass surveillance ^[1]. The government is not merely buying AI; it is selecting partners by their willingness to let the models pull triggers. None of this began with Iran. Stargate, the $500 billion OpenAI-Oracle-SoftBank venture, was announced in October 2025, months before the war, and the administration has always framed the buildout as a race with China ^[2]. The war didn't start the buildout. It gave it a new argument — and a new customer. The same loop runs at the Strait of Hormuz. This week, Treasury Secretary Scott Bessent said two things that cannot both be true. The strait, he said, will be a worthless piece of water within two years, because the oil will be moving on pipelines across the land.

In two years, the Strait of Hormuz will be a worthless piece of water. — Scott Bessent

And in the same breath, Iran will come to the table and want a deal it can stick with.

At a point, either the IRGC are going to turn on each other, the people are going to turn on them, or they’re going to come to the table and want to do a deal that they can stick with. — Scott Bessent

If the strait is about to be worthless, there is nothing left to negotiate over. The deal he says he wants can only be a demand for surrender. The infrastructure is real, not rhetorical. Saudi Arabia has maxed out its East-West pipeline to reroute crude to Yanbu on the Red Sea and is studying reviving the Hijaz Railway to link the Gulf to Turkey and Europe; the UAE is building new pipeline and port capacity ^[3]. The IEA has proposed a Basra-Ceyhan line through Iraq and Turkey ^[4]. But these bypasses currently move only a fraction of the volume that once transited Hormuz — Bessent's two-year timeline is a projection, not a present reality. The domestic half of the replacement is further along. Meta's Hyperion facility in Louisiana will run on ten company-funded natural gas plants generating 7.5 gigawatts ^[5]. The Energy Department has picked four federal sites — Idaho National Lab, Oak Ridge, Savannah River, and Paducah — for AI data centers, with the energy secretary calling it the next Manhattan Project ^[6]. Bessent's own language names the endgame. He has branded the sanctions campaign Economic Fury to parallel the military's Operation Epic Fury, and promised to economically asphyxiate the regime ^[7].

economically asphyxiate this regime — Scott Bessent

A man who promises to sever every lifeline and render the strait worthless is not describing a negotiation. He is describing the terms of a surrender, and calling it a deal.