When Hyperglobalization Meets Chaos - P. Krugman
Choke points are everywhere you look
Paul Krugman
Mar 23, 2026
Donald Trump and his minions are having a meltdown. On Saturday, Trump lashed out at the New York Times for an article saying the obvious — that many of his original war goals, whatever they may have been, remain unaccomplished. Just an hour later, he posted a threat to commit massive war crimes, saying that if Iran doesn’t open the Strait of Hormuz within 48 hours — that is, today — he will order U.S. forces to begin bombing civilian power plants.
Why the desperation? The answer is obvious. It’s turning out not just that regime change — if that was really the goal — is hard to engineer, but also that the world is a lot more dependent on the Strait of Hormuz than Trump and co. seem to have realized. And what is becoming increasingly clear is that this dependence extends well beyond oil and natural gas.
In addition to oil and gas, the Gulf region is a key global source of fertilizer. It produces about a third of the world’s helium — and helium isn’t just for party balloons, it’s key to production of semiconductors and has important medical uses. And — this I didn’t know — the Gulf is a choke point for pharmaceuticals, with many key ingredients normally shipped through Hormuz and many final products normally being flown to their destinations via Dubai and other Gulf airports.
So are we learning that the Persian Gulf is a uniquely crucial choke point for the world economy? I don’t think so. It’s certainly an important choke point. But it’s not unique. If the Hormuz crisis seems bad, think about the disruption to global supply chains if China were to attack Taiwan or if North Korea were to attack South Korea. Taiwan accounts for over 60% of the world supply of semiconductors and over 90% of the supply of the most advanced semiconductors. South Korea is a major exporter of memory chips. An ongoing imbroglio between the Dutch government and the Chinese chip company Nexperia, based in the Netherlands, has threatened to upend auto production around the world. India is a major exporter of key pharmaceuticals, including vaccines. Trump backed down on his Liberation Day tariffs imposed on China because it is by far the greatest source of rare earths and retaliated by cutting off the flow. And on and on.
Continued https://open.substack.com/pub/paulkrugman/p/when-hyperglobalization-meets-chaos