Back last summer Slow Boring partnered with the Institute for Progress to help solicit ideas for what we’re now calling the Transit Abundance Playbook, a list of ideas to help address the cost bloat that has afflicted American transit construction.

Veteran Slow Boring readers will know that this is a longtime obsession of mine. I’m a native New Yorker who rode the subway every day in high school. When I moved to the totally unfamiliar city of Washington after college, I blindly ended up in Columbia Heights because I was looking for a cheap place near a Metro station. I used to think that American cities were under-provided with transit because the country was too unwilling to spend money. But I’ve learned that the United States actually spends a lot on transit construction — it just doesn’t build a lot of transit per dollar spent.

Improving the cost-effectiveness of projects would get more projects built without any more spending, and that in turn would strengthen the political case for spending. But while it’s easy to identify specific examples of bloated costs, what’s harder is to develop concrete policy ideas that change the way the whole system works.

Now, though, I think there’s a menu of ideas that could really fix the problem.

— Matt

Stop Paying More for Less Transit

By Will Poff-Webster and Arnab Datta

The United States once led the world in transit construction. In the 19th century, publicly subsidized railroads catalyzed steel production, agriculture, and even financial markets. In the early 20th century, America built the largest network of streetcar tracks in the world, igniting the first suburban boom and making homeownership and jobs available to millions. Subway systems enabled industrial growth and the development of knowledge-economy hubs that fueled American prosperity. Transit’s ability to move large numbers efficiently remains unmatched: Every day, the New York City subway serves more passengers than all American airports combined. Even in car-friendly Houston, more than half of suburban commuters to downtown take the bus.

But America has lost its edge. Today, we lead the world in transit construction costs, and build less as a result. America’s first subway line opened in 1897: a 1.5-mile tunnel in Boston built in just four years at a cost of roughly $5 million (about $200 million today). Had we kept costs steady since, we would be nearly on par with other developed countries. Instead, in 2022, New York City’s East Side Access project finally opened after 24 years of construction and $11.2 billion in expenditures — giving it the dubious distinction of being, per mile, the most expensive transit project ever built.

At least that project opened. Californians may never see the San Francisco-Los Angeles high-speed rail line they approved in 2008 and have already spent $15 billion on; the project’s expected cost has ballooned from $33 billion to more than $126 billion, with no plan to close the funding gap. Over the same period that California was failing to build a route from Bakersfield to Merced — just 150 miles apart — China connected every one of its major cities with 30,000 miles of high-speed rail.

We spend billions on transit projects but deliver far less per dollar than our global peers. The invisible costs are even higher: dysfunctional processes kill light rail routes that would unlock suburban growth, subway extensions that would connect working-class neighborhoods to job centers, and bus rapid transit corridors that would slash commute times for tens of thousands. Headlines about spiraling costs and decades-long timelines foster the belief that America cannot do big things anymore, a belief reaffirmed every time a major construction project becomes a cautionary tale.

Sky-high costs are an unfortunate case of American exceptionalism, but not an inevitability. The wealthiest country in the world should not fail where Southern Europe succeeds. We know what drives high US transit construction costs: overdesign and excessive customization, poor planning and procurement, too many veto points, burdensome permitting, and anemic state capacity. These problems compound, leaving only one option: pay more for less.

Just as there is no single cause for America’s high transit costs, there is no single solution. This playbook brings together leading transit practitioners, researchers, and advocates to translate research into policy solutions — each addressing a core driver of high US transit costs.

There is renewed attention to the red tape plaguing America’s ability to build. Consensus is growing that we need to remove barriers that constrict growth and stifle government delivery, but implementation is too often underexamined. Federal funding plays a central role in major transit projects. Accordingly, congressional and executive branch actions are powerful levers to address the high costs of transit nationwide. While federal policy is at the core of this playbook, solutions also target states, local governments, and private actors.

Cost-effectiveness need not be polarizing. Transit advocates should champion spending less, because every wasted dollar is another project never built. Fiscal conservatives have much to gain from faster delivery, because every delay begets more spending. Environmentalists can celebrate the construction of megaprojects that reduce pollution. Cities thrive when the public sector can build, and rural counties deserve buses that aren’t twice as expensive as in peer countries. And more transit ridership means less traffic for drivers.

Feats of infrastructure and governance once showed us what was possible, but our policy choices have throttled our ambitions. While American workers, scientists, and technologists race ahead to the next challenge, they ride to work on infrastructure largely built by past generations.

The proposals in this playbook offer concrete solutions to build the transit the public deserves, at costs the public can afford, on timelines that allow people to actually benefit. Let’s close the gap between where we are and where we need to be.

All of the pieces in the Transit Abundance Playbook are available at ifp.org/cheaper-transit, and at the following links:

Planning

• Reform Funding to Encourage Early Transit Planning, Eric Goldwyn - The federal grant review process incentivizes agencies to rush to secure funding rather than methodically plan projects. A phased “Transit ID” program (mirroring the Federal Railroad Administration’s “Corridor ID”) with smaller, milestone-based grants would reduce risk and lead to better projects.

• Focus Capital Investment Grants on Improved Project Delivery, Stephanie Pollack - Federal grants that fund most major American transit projects are governed by rigid, bloated rules that impede timely and cost-effective project delivery. Reforms could cut procedural requirements, fund early right-of-way and early works investments, require accelerated state and local permitting, and loosen procurement rules to favor the highest-value bids.

Cost-effective design

• Reduce Needless Bus Customization, Rohan Aras and Alex Armlovich - Buses cost twice as much in the US as in peer countries, in part due to excessive customization by transit agencies. Capping federal cost-sharing at a benchmark price and encouraging standardization and joint procurement could bring costs down while unlocking manufacturing economies of scale.

• Eliminate Redundant Subway Cross-Passages, Brian Potter - US subways follow a safety standard from the National Fire Protection Association that mandates twice as many cross-passageway tunnels as in Europe, with no demonstrated safety benefits. Adopting the European standard in the US could save millions in construction costs.

Procurement

• Get the Best Value in Transit Procurement, Anthony Potts - State and local procurement rules often require awarding contracts to the lowest bidder, even though this leads to worse, costlier outcomes over the long term. Federal transit grants should encourage best-value selection, in which agencies evaluate contractor competence and price holistically.

• We Should Know How Much Transit Components Cost, Alon Levy - Lump-sum, NDA-protected construction contracts hide true project costs, resulting in lawsuits for changes during construction and 20–50% bid inflation by contractors. Requiring itemized bidding based on a database of component prices (as practiced in Italy and Spain) would increase transparency and reduce costs.

Utility, agency, and local government coordination

• Transit Projects Need a Single Decision-Maker, Anonymous - To build a transit project, transit agencies must negotiate dozens of separate agreements with utilities, local governments, and other third parties. Each is an opportunity to extract concessions paid for with transit dollars. Adopting Italy’s Conference of Services model would allow a single appointee to decide on project tradeoffs and ensure disputes are resolved up front, rather than at the last minute when transit agencies have the least leverage.

• Use AI to Improve Transit Planning, Lizzie Speed and Bennett Capozzi - Transit project knowledge is scattered across past reports and data sources, increasing the need for consultants and preventing the development of in-house expertise. A centralized repository for federal transit reports and project data, along with an AI-based system for querying it, would allow transit agency staff to mine past projects for usable lessons. This would mirror similar innovations at other federal agencies like the FDA.

Permitting

• Let Agencies Do Their Own Environmental Review, Jamey Tesler - The Federal Highway Administration delegates part of its environmental review process to states, reducing review times by up to 85%. Adopting the same framework at the Federal Transit Administration (FTA) could similarly accelerate reviews for transit projects.

• Fast-Track Democratically Approved Transit Projects, Hayden Clarkin - Requiring environmental review for voter-approved transit projects generates costly and redundant documentation (100,000+ pages and more than $1 billion in costs for California high-speed rail) and delays environmentally beneficial transit projects. Exempting voter-approved projects would accelerate their delivery, ensuring constituents don’t wait decades to get what they asked for.

• Let Transit Agencies Buy Land, Aidan Mackenzie - FTA’s expansive reading of environmental law bars agencies from project steps such as buying land until after project permitting is complete. These activities are often best done early, but the ban incentivizes agencies to compromise project design in order to avoid them. Allowing early works would reduce costs and enable better project delivery.

State capacity

• Put Transit Staff in Charge of Their Own Projects, Paul Lewis - Agencies have outsourced design, project management, and risk to consultants, incentivizing scope creep, inflating labor costs, and eroding in-house expertise. Federal grants and oversight should incentivize more capacity within transit agencies.

• Close America’s Transit Automation Gap, Andrew Miller - A provision in the Urban Mass Transportation Act of 1964 mandates an open-ended review whenever federal funding would affect jobs, effectively blocking the automation of legacy subway systems. Amending the statute to explicitly guarantee worker protections, rather than requiring a veto-prone process, would enable agencies to pursue automation and unlock substantial operational savings.

• Share the Truth About Transit Project Failures, Philip Plotch - Fear of reputational damage and litigation suppresses honest post-mortems on transit projects, leading to new projects repeating the same mistakes. Providing confidential ways for agencies to share lessons learned, protected against FOIA, would enable candid knowledge sharing.

• Loans Can Stabilize Transit Funding, Jackson Moore-Otto - Transit agencies depend on unpredictable discretionary grants to fund new transit construction, an arrangement that leads to poorly planned, grant-chasing spending. Streamlining access to federal loans would create an alternative funding model for projects that promise a strong return on investment and encourage both cost discipline and the development of internal agency capacity.

Special thanks to all playbook authors, and to Eric Goldwyn, Jarrett Stoltzfus, and Stephanie Pollack for their contributions advising the project. The Transit Abundance Playbook was created with the help of Rita Sokolova, Reed Schwartz, Abigail “Beez” Africa, Aidan Mackenzie, and Ben Schifman.

Every little thing in a graphical user interface that we take for granted today, no matter how small, was thought up by someone, at some point. Case in point: the little red squiggly lines underneath misspelled words. In one form or another, these are everywhere now, and have just become a regular staple of every single text editing field we encounter every single day and don’t stop to think about. Still, they were invented by someone, and we happen to know exactly who that was: Tony Krueger.

In early versions of Word, the Spell Check feature was something that you explicitly invoked, and then you had to sit and wait while the program looked for all your potentially-misspelled words, and then showed them to you one at a time for a decision on what to do for each one. Word did introduce an Auto Spell Check feature to run spell check when the user was idle, so that when you hit the Spell Check button, the results were ready to go. However, the Auto Spell Check was still a blocking operation. As a result, a lot of users turned it off because it always seemed to decide “Now would be a good time to spell-check the document” just as you wanted to do something, forcing you to wait for the spell check pass to complete before you could, say, save and exit.

Tony made the spell checker much more unobtrusive so that it didn’t interfere with your foreground work. And when it found a problem, instead of waiting for you to trigger a spell check, it immediately drew red squiggles under potentially-misspelled words (and later green squiggles under potential grammatical errors).

↫ Raymond Chen at The Old New Thing

Tony Krueger passed away recently, after, among other things, having worked on an dizzying number of Microsoft Word releases. Imagine coming up with something that seems to basic and elementary to us now, and seeing it spread pretty much everywhere. I wonder what it must feel like to have invented something that seems so simple, most people don’t even realise they use it every single day.

Ocean City’s tourism industry is looking sunny. Hotel vacancies are down, spending is up. Even traffic has improved: Where once 118,000 drivers crossed the Chesapeake Bay Bridge every Friday, Saturday, and Sunday of the summer, today just 94,000 do the same. This is not due to lower demand but the post-pandemic work week. Workers once squeezed by rigid work hours into three-day weekends can now take their time by heading out on Thursday and coming back Monday.

But Maryland’s planners have not kept up with the times. Citing years-old models projecting explosive weekend travel demand, the Maryland Transportation Authority (MDTA) plans to spend $4.4 billion to widen the Chesapeake Bay Bridge from five lanes to eight on top of the $12 billion overall replacement cost.

The now-$16.4 billion project – some 2.9% of state GDP – is the result of profound bureaucratic inertia built up over a decade of work. MDTA damned transit with a geographic double standard and comically poor cost and ridership models, and it relied on pre-pandemic travel demand forecasts based on optimistic and static land-use plans to demonstrate a surge in demand, thereby excluding narrower options. After the pandemic, MDTA never revisited these decisions, locking the state into a trajectory for a destination that no longer exists.

This is not simply about the state’s passive acceptance of a decades-old, highways-first planning process. It is about how Maryland’s institutions, grinding through that process, doomed a transit alternative, and how the state must now break the inertia of its bureaucracy.

The manufactured geography of asymmetry

Before doling out federal transportation funds, national environmental law requires states to clearly define their goals and rigorously analyze all options to meet those goals. In theory, transit has a fair shot at meeting these goals, and by law it must. In practice, states can simply describe the project’s goals such that only roads could ever hope to meet them.

For the Bay Bridge, MDTA was able to take advantage of the existing highway networks on either side of the bridge to limit its scope to a single 22-mile bottleneck, stating that traffic could simply filter out on either side. Maryland could simply punt the impacts on the side roads and feeder roads to other projects and agencies.

MDTA afforded transit no such luxury. While the agency restricted its highway alternative to just one segment of the network, it forced its transit alternative to solve the entire 192-mile journey from DC and Baltimore to Ocean City.

This double standard was not born out of malice but of the deep rut Maryland has carved for itself. Over the past 80 years, the state government has spent billions of dollars to stitch together a highway system linking its every corner. It is only logical for highway planners to take advantage of this sunk capital, just as they always have, to restrict their work to a single geographic chokepoint. But doing so blinds them to the cascade of traffic problems this project will cause, the economic drain caused by those new problems, and the cost to fix them. Transit planners cannot afford such blinders.

Golden rails, ghostly riders

The geographic disparity was only the first blow against transit. Next came costs. For these, MDTA drew not on peer intercity rail projects but on the quintessentially urban WMATA Silver Line, effectively modelling a $321 million-per-mile Metrorail extension to Ocean City, using today’s dollars. This would make it even more expensive than California’s pricey high speed rail project, which is now projected to cost a relatively modest $184 million per mile.

A more realistic North American analogue, the 180-mph Brightline West from Los Angeles to Las Vegas, costs just $98 million per mile, while slower diesel projects like TEXRail can be delivered for a mere $49 million per mile.

Buses were not immune from such inflation, either. Rather than model a modest high-occupancy toll lane within the 22-mile limits of the project, which would have cost effectively nothing, MDTA used the now-cancelled Corridor Cities Transitway, which would have run throughout urban Montgomery County at a cost of some $75 million per mile, and stretched it over the same 192-mile journey.

Having inflated costs to absurd heights, MDTA then suppressed ridership in ways that border on comedy. Most ridership models for transit take into consideration the totality of the service on offer: its speed, its frequency, and the places it serves. MDTA dispensed with such complexity. Using 2017 ridership data from mixed-traffic commuter buses and travel patterns that date from George W. Bush’s first term, MDTA assigned cities and counties a static percentage of travel to Ocean City that would be done by transit: 10% for DC, 5% for Baltimore, etc. Any intermediate ridership potential, and any data from this decade, were ignored entirely.

The result was an infinitesimal ridership projection. MDTA confidently concluded that just 0.7% of corridor travel would be done by transit on weekdays and 1.14% on weekends, no matter how fast or slow the train, no matter if the bus had its own lanes or fought through gridlock, no matter how many trips per day were scheduled, no matter where the stops were located.

Tautologies of travel demand

Defenders may concede that the MDTA’s study was flawed but insist that its conclusions were valid. Maryland’s model of future travel demand, the one that predicts 135,000 trips per summer weekend day, projects that planned land uses and developments will be scattered rural and semi-rural places that cannot be well-served by transit. Spending billions on a transportation project sized for summer demand would be a waste. Besides, even if travel demand has slumped, it would be irresponsible of the state to abandon the Eastern Shore to future congestion.

As Queen Anne’s commissioner-at-large Jim Moran fatalistically put it to Baltimore Magazine’s Lydia Woolever: “Will there be more traffic? There always will be more traffic.”

These defenses are politically convenient but analytically hollow, relying on an artificial divorce of land use and transportation capacity. The state’s forecasted summer travel surge, for instance, is derived from local land use plans that are static and optimistic, entirely immune to how congestion impacts development viability or land value.

Localities, banking on driving remaining the only viable option, have planned accordingly, and the state is making its decisions based upon how localities believe the state will make its decisions. In short, Maryland says a wider bridge must be built in order to meet travel demand that will very likely only materialize if a wider bridge is built. And because these localities banked on driving at the outset, regional transit will remain boxed out. It is a tautology dressed up as a model.

Yet even this is not the end of the state’s methodological flaws. MDTA left travel demand management tools like congestion pricing out of the final analysis because these tools could not solve congestion on their own. Apart from its use of an unfair baseline and absurd assumptions in analyzing transit, MDTA never actually modeled transit using state travel demand forecasts. And MDTA ignored its own estimates that a modern bridge could carry 6% to 11% more traffic per lane per hour than the existing twin span. As a result, a six-lane option, paired with demand management, never even advanced to the final analysis.

Taken together, a wider span seems to have been a foregone conclusion. By analyzing congestion pricing and bridge modernization apart from one another and apart from travel demand, relying on models that unrealistically divorce land use from transportation capacity, and sabotaging transit at every turn, the only option left standing was the $16.4 billion option. Even if an eight-lane bridge is the right choice over a six-lane option, the methodology and analysis are so flawed there is simply no way to know.

Breaking the inertia

As a result, MDTA must halt this process before it closes the book this November by issuing a Record of Decision and correct its methodological failures with a Supplemental Environmental Impact Statement. To do so it will have to rewrite the goals of the project to consider the entire 192-mile corridor, allowing roads and transit to compete fairly. And it will need a new travel demand model that realistically incorporates the inseparable link between land use and transportation, and which is based on contemporary data.

Finally, MDTA needs to assess a new set of alternatives that incorporate the complementary nature of congestion pricing, transit options, and modernized bridge lane capacity based on real-world analogues. MDTA must exorcise from its analysis the self-fulfilling demand models and shadows of the pre-pandemic world.

Any supplemental analysis will also need to incorporate Maryland’s statutory greenhouse gas reduction goals and transportation policies. Under the Climate Solutions Now Act, the state is required to reduce its greenhouse gas emissions to net zero by 2045 – the same year travel models predict 135,000 vehicles per day will cross the Chesapeake Bay Bridge.

To help achieve this goal, Governor Wes Moore’s administration has pledged to cut per capita driving by 20% by 2050. Either of these goals would be difficult for any government to meet, but they are not impossible. Alongside vehicle electrification, the state will have to unwind decades of highways-first planning. To achieve this, the state will have to aggressively and consistently expand transit and active transportation options, deploy congestion pricing, and encourage smarter land use policies before even considering pouring more asphalt. Only then could it possibly meet its goals.

A plan to spend a generational sum on the state’s largest highway project based on old data, inflated costs, and flawed models, however, is an active threat to the administration’s goals and the state’s duty of due diligence to its taxpayers. Maryland cannot allow the weight of its bureaucratic inertia to set such errors in concrete.

Top image: Maryland is intertia-ing its way toward an expensive plan to widen the Chesapeake Bay Bridge.  Image by Peter Burka licensed under Creative Commons.

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Maybe you, too, have already swatted away – or worse, been bitten by – mosquitoes despite the early date on the calendar. Usually, mosquitoes are a problem only in DC’s notoriously damp late summer, and especially given the bitter winter that just passed.

If you’re in central DC, you might be able to blame cars, or more specifically underground parking garages, for creating year-round mosquito sanctuaries. That’s the finding from “Paved Paradise: Below ground parking structures sustain urban mosquito populations in Washington, D.C.,” a 2021 article in the Journal of the American Mosquito Control Association by Arielle Arsenault-Benoit and Megan Fritz, two University of Maryland entomologists, and Albert Greene from the federal Public Buildings Service.

The study was prompted after federal workers at office buildings in Southwest DC complained about mosquitoes. Mosquito species known to carry tropical diseases, including dengue, Zika, yellow fever, and West Nile fever, were identified around these buildings in summer 2018 and 2019. Researchers visited nine below-ground sites at federal office buildings in central DC over the course of a year to log temperatures and collect both adult and juvenile mosquitoes.

Three of the underground sites harbored juvenile mosquitoes, indicating that mosquitoes were breeding there. Genetic analysis showed that the populations were related from year to year, definitively proving that the mosquito populations were established inside the garages rather than newcomers from outside.

Temperatures underground are pretty much constant at around 50 degrees Fahrenheit year-round. In years past, people took advantage of this fact to keep ice cold in summer and food unfrozen in winter; today, it makes geothermal heat pumps possible. It also means that even these unheated underground garages, open to the chilly air above but otherwise enveloped by the unfrozen thermal mass of the Earth, could maintain an average temperature of 52 degrees Fahrenheit and not drop below 41 degrees.

So any mosquitos that find a puddle underground can shrug off DC’s winter chill – the outdoor low that winter was 12 degrees. After all, the winters inside are as warm as in the Florida Keys. And puddles are plentiful underground; basement garages are damp and their drainage systems, which have to pump water up against gravity, are often sluggish.

Now that we know where mosquitoes are overwintering, they can be targeted more effectively. If you’re noticing mosquitoes early in the year around your home or office, talk to your building’s management and cooperate with neighbors, because mosquitoes don’t care about property lines.

Meanwhile, we can now add “reducing the chances for disease-carrying vampire insects to survive” to the long list of reasons to pursue parking reform. Nonexistent, or at least smaller and shallower, parking garages would offer fewer warm-weather havens.

Top image: Underground parking garages, like this infamous one in Rosslyn, are great places to hide spycraft – or tropical mosquito species. Image by the author.

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Young people won’t remember this, but there was a distinct point at which George W. Bush started to lose the country. In August 2005, a giant hurricane swamped New Orleans, killing over a thousand people and washing away whole parts of the city. Bush displayed startling incompetence and tone-deafness during the cleanup, which began a process of general disillusionment with his presidency that intensified with the financial crisis of 2008 and the long slog in Iraq.

I don’t know whether Trump’s debacle in Iran will be a similar moment for his presidency. For one thing, unlike Bush, Trump’s approval ratings were already very low before Iran:

Compared to the other stuff people hate about Trump — the blasé attitude towards inflation, the tariffs, the unprecedented corruption, the ICE raids, the various abuses of power — the Iran War may end up being a minor footnote. But there is one similarity with Katrina: This is the point at which even many of Trump’s defenders will be forced to admit, in private if not in public, that the man and his administration are grossly, pathetically incompetent.

The details of the deal that Trump is trying to make in order to withdraw from the war he started are still murky and unclear — probably because as soon as those details are released, people will realize that the U.S. has effectively been defeated by Iran. Here’s what the deal is rumored to contain:

(Update: Bloomberg has the confirmed details of the draft memorandum, and and the initial reports look to have been completely accurate.)

Plenty of people, looking at these details and observing the conduct of the war, are ready to speak the plain truth that the U.S. lost the war to Iran. Tom Nichols, a former professor at the U.S. Naval War College, had this to say:

Trump and his team, in record time, just lost a war to a militarily mediocre—but nonetheless extremely dangerous—adversary…[E]ven before we have the details, it is clear that Trump has failed to achieve every one of the goals he put forward for this war of choice, and now he is determined to sign, seal, and deliver America’s capitulation as quickly as possible.

The New York Times editorial board concurs, with the headline: “Trump Lost the War He Started in Iran”. The WSJ Editorial Board is slightly nicer, writing “Trump Stages an Iran Retreat”.

As regular readers of this blog know, I’m very skeptical of claims that America has “lost” this or that war:

For example, we clearly won the Iraq War, despite a generation of pundits who got used to repeating that we “lost”. We defeated all enemies — Saddam, various militias, and ISIS — and established a friendly, pliant government that allows U.S. oil companies unfettered access to the country. Bush’s war was a strategic mistake — in my opinion, the geopolitical benefits weren’t worth the costs — but by any reasonable historical standard, it was a victory.

The same is not true, however, of Trump’s war in Iran. This one really is a clear defeat for the U.S. The reason is not just that the U.S. failed to achieve its strategic goals. It’s how Iran forced the U.S. to give up those goals.

How Iran won the war

Iran used military force to defeat the U.S. First, it successfully dispersed and hardened its key forces — missiles and drones. This is from the Washington Post on May 7th:

A confidential CIA analysis delivered to administration policymakers this week…found that Tehran retains significant ballistic missile capabilities despite weeks of intense U.S. and Israeli bombardment…Iran retains about 75 percent of its prewar inventories of mobile launchers and about 70 percent of its prewar stockpiles of missiles, a U.S. official said. The official said there is evidence that the regime has been able to recover and reopen almost all of its underground storage facilities, repair some damaged missiles and even assemble some new missiles that were nearly complete when the war began.

And this is from CNN on May 21st:

Iran has already restarted some of its drone production during the six-week ceasefire that began in early April, one sign it is rapidly rebuilding certain military capabilities degraded by US-Israeli strikes, according to two sources familiar with US intelligence assessments…Iran’s military is reconstituting much faster than initially estimated…[S]ome US intelligence estimates indicate Iran could fully reconstitute its drone attack capability in as soon as six months…Iran has been able to rebuild much faster than expected due to a combination of factors, ranging from support it is receiving from Russia and China to the fact that the US and Israel did not inflict as much damage as the two countries had hoped, one of the sources told CNN…

Thousands of Iranian drones still exist — roughly 50% of the country’s drone capabilities[.]

Iran dispersed and buried both its weaponry and its defense industrial base, and the U.S. was unable to destroy it.

Next, Iran used its surviving weapons to execute an effective naval blockade of the U.S., and its key allies.

The naval blockade was Iran’s closure of the Strait of Hormuz. This vital waterway, which delivers much of the world’s oil, is right next to Iran, so Iran had the geographic advantage. It used drone boats, naval mines, aerial drones, and missiles to prevent ships from transiting the strait. This did two things. First, it raised the global price of oil, which raised gasoline prices in America:

It also sent U.S. inflation back to around 4%, which caused Americans’ real wages to start falling:

Meanwhile, the U.S.’ allies — the Gulf states and Saudi Arabia — were severely impacted by Iran’s blockade of Hormuz, since much of their oil couldn’t be sold. These allies put pressure on Trump to end the war.

The U.S. tried many things to open the Strait of Hormuz, but nothing worked. American strikes were incapable of destroying Iran’s weaponry or forcing Iran’s regime to submit. So in the end, it had to submit. The deal Trump is reportedly cutting makes huge concessions to Iran, leaving Iran in a much stronger position both economically and militarily than it was before the war:

• The U.S. will withdraw its forces from the conflict zone within 30 days.

• All U.S. sanctions on Iran are reportedly being lifted. Before the war, sanctions had crippled Iran’s economy since 2012, leaving it stagnant and sclerotic. With those sanctions gone, Iran will be able to sell oil and grow much more prosperous.

• Iran will reportedly start charging fees on transit through the Strait of Hormuz. This is a toll on international shipping — something forbidden by the UN Convention on the Law of the Sea. This will be a huge source of income for Iran — something that didn’t exist before the war.

• The U.S. and/or its Middle Eastern allies will reportedly pay Iran a $300 billion reconstruction fund, as well as unfreezing Iranian assets. This is equal to one entire year of Iran’s GDP, and would effectively constitute war reparations. JD Vance has said that the reconstruction fund is not yet confirmed.

Iran thus compelled the U.S. to withdraw its military, end the sanctions that were in place before the war, and potentially pay Iran reparations. In exchange, Iran will allow the Strait of Hormuz to open (with tolls) and will publicly declare that it’s not pursuing nuclear weapons (which it has always publicly declared in the past).

In addition, Iran will gain an important new source of geopolitical power and economic revenue: control of the Strait of Hormuz.

Before the war, Iran didn’t control the strait, simply because it didn’t realize it could. Drone technology had advanced to the point where Iran was able to shut down Hormuz, but Iran didn’t know that until the U.S. attack forced it to try the risky and desperate move of actually shutting down the strait. The gambit paid off spectacularly, and now Iran knows that modern drone weaponry gives it an advantage it didn’t have in previous decades. So it controls Hormuz.

It’s kind of wild to step back and consider how good of a position Iran’s leaders are in now, compared to the situation before the war. Iran had lost most of its proxy armies in the Middle East — Hezbollah, Assad, most of Hamas. The regime had been rocked by massive nationwide protests, which it only managed to quell by murdering tens of thousands of innocent Iranian citizens. The country’s economy was slowly dying. Now the leaders are firmly entrenched in power, their economy will be revived, and they find themselves the masters of Hormuz for the first time.

Anyway, I don’t see any sense in which this is not a classic military defeat for Donald Trump and the United States. Consider the contrast with Iraq. None of America’s opponents in the war were in power after the war; in Iran, despite the assassination of a few leaders, the regime is even more firmly in power now than before the war. In Iraq, the U.S. suffered some economic damage, but was willing to see the conflict through until all opposition was defeated and all U.S. war aims were achieved (except for the destruction of WMDs, which never existed in the first place and so could not be destroyed). In Iran, economic pressure forced America to make major concessions relative to the pre-war status quo.

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