Donald Trump ordered a major new American military campaign against Houthi-controlled areas of Yemen on 15 March, after the Iran-aligned movement threatened to resume attacks on shipping connected to Israel in response to restrictions on aid entering Gaza. US strikes hit targets across Yemen, including around Sanaa and Saada, and the Houthi-run health authorities reported dozens killed and wounded. Trump has promised to use “overwhelming lethal force” until the Houthis stop threatening international shipping, while also warning Iran that Washington will hold it responsible for the actions of the groups it supports. The immediate strategic objective is understandable. Since late 2023, Houthi missiles and drones have transformed one of the world’s most important maritime corridors into a security risk, forcing many commercial vessels away from the Red Sea and through the much longer route around southern Africa. Yet the United States already spent much of 2024 striking Houthi military infrastructure without eliminating the threat permanently. The question is therefore not whether American aircraft can destroy launchers, radar systems and weapons depots. They clearly can. It is whether military punishment can change Houthi behaviour faster than the organisation can replace its weapons and convert American attacks into political legitimacy.
The economic stakes begin with geography. The Bab el-Mandeb Strait connects the Red Sea with the Gulf of Aden and forms part of the route between Asia, the Suez Canal and Europe. Before the current crisis, roughly 12–15% of global trade and a substantial share of container traffic normally passed through the Red Sea-Suez route. When vessels instead travel around the Cape of Good Hope, journeys between Asia and Europe can become thousands of kilometres longer, consuming more fuel, tying ships up for additional days and reducing the effective capacity of the global shipping fleet. The Houthis therefore possess leverage radically disproportionate to Yemen’s economic size because they operate beside a maritime chokepoint. This is geographical power: control or disruption of a narrow network node can matter more than aggregate GDP.
The effect demonstrates why globalisation creates both efficiency and vulnerability. International supply chains became cheap partly because firms could assume major shipping lanes would remain continuously available. That allowed inventories to shrink and production to specialise geographically. A container could move from East Asia through Suez towards Europe according to relatively predictable schedules. Disrupt the route and the same optimisation becomes fragility. Firms need larger inventories, shipping companies charge more and insurance premiums increase. The Houthis do not need to sink every vessel to impose these costs. They need only increase the probability of attack enough that commercial operators change behaviour.
This makes the campaign partly a problem of deterrence by denial. The United States can attempt to intercept missiles and drones before they reach ships, escort commercial traffic and destroy launch systems. But defensive interception can become economically asymmetric. A relatively inexpensive drone can force the use of a sophisticated interceptor costing much more. Even successful defence therefore consumes finite inventories and resources. The Houthis can lose almost every individual engagement while still imposing costs if they can sustain attacks cheaply enough.
The alternative is deterrence by punishment: impose enough damage on Houthi leadership and military infrastructure that continuing attacks becomes irrational. Trump’s escalation appears to lean much more heavily towards this model. The difficulty is that the Houthis are not an ordinary state government maximising national GDP. They are an ideological armed movement that survived years of war against a Saudi-led coalition possessing far greater conventional military power. Yemen endured extensive bombing, economic disruption and humanitarian catastrophe without the Houthis being removed from power in the north. Their tolerance for punishment may therefore be substantially higher than the tolerance assumed in conventional deterrence models.
This is why the target’s utility function matters. Destroying $1 billion of infrastructure does not necessarily create $1 billion of political pressure. A democratic government dependent on middle-class prosperity may become extremely sensitive to economic disruption. An armed movement governing an already impoverished and war-damaged territory may absorb the same loss differently. Deterrence fails when the attacker calculates costs according to how painful they would be to itself rather than how the target actually values them.
The Houthis also derive political value from confrontation with Israel and the United States. They present attacks on Red Sea shipping as support for Palestinians in Gaza, allowing a movement rooted in Yemen’s domestic conflict to position itself as an actor in the wider Arab-Israeli struggle. American strikes can therefore produce two effects simultaneously: degrade Houthi military capability and strengthen the organisation’s claim that it stands at the centre of resistance to Washington and Israel. Military punishment can destroy physical capital while creating political capital.
That does not mean the United States should simply tolerate attacks. Freedom of navigation is a genuine international public good. If armed groups can impose political conditions on global shipping through missile attacks without significant consequences, other actors have incentives to adopt the same strategy. The Red Sea is not owned by the United States, but American naval power has historically played a large role in maintaining maritime security from which many countries benefit. The problem is designing force that protects the public good without turning a shipping-security mission into another indefinite Middle Eastern war.
This is the mission-creep problem. The initial objective is narrow: stop attacks on vessels. Military operations then reveal Iranian supply networks. Strikes expand towards command facilities. Retaliation threatens American bases. Washington begins targeting a wider range of assets. Iran becomes more directly involved. A limited maritime operation gradually becomes regional coercion. None of the individual steps necessarily appears irrational. The accumulated mission becomes much larger than the one originally authorised politically.
Trump’s warning to Iran therefore matters. Tehran has supplied, trained and supported the Houthis, although the exact degree of Iranian operational control over individual Houthi decisions is debated. Trump has said the United States will increasingly treat Iran as responsible for Houthi attacks. This is an attempt to solve the principal-agent problem of proxy warfare by raising costs for the sponsor rather than only the proxy. If Iran believes every Houthi attack could produce direct consequences for Iranian interests, Tehran has stronger incentives to restrain its partner.
The weakness is that proxies are useful precisely because sponsors do not control them completely. Iran can provide weapons, technology and political support while the Houthis retain their own leadership and objectives. Holding Tehran responsible for every Houthi action therefore can create escalation even where Iran did not order the specific attack. Attribution needs to distinguish support from command.
Yet allowing sponsors to escape every consequence by claiming operational independence creates the opposite moral hazard. A state could arm partners extensively while maintaining plausible deniability whenever they attack. Effective deterrence therefore needs some middle position: Iran should bear costs for material support enabling attacks, while direct military escalation against Iran should depend on stronger evidence about involvement.
This is increasingly important because Iran’s regional network has already suffered enormous damage. Hamas has been weakened, Hezbollah lost Hassan Nasrallah and much of its senior command, and Bashar al-Assad’s government collapsed in Syria. The Houthis therefore have become relatively more important within Tehran’s remaining network. Their survival demonstrates that Iran’s strategy possesses redundancy: losing one partner does not eliminate the entire regional architecture.
But redundancy has limits. Syria’s collapse disrupted supply routes. Hezbollah’s weakening reduced Iran’s deterrence against Israel. If Houthi military capabilities are also degraded heavily, Tehran’s ability to project power through partners becomes narrower. This could push Iran towards restraint. It could also increase the strategic value of its own ballistic missiles and nuclear programme because proxy deterrence appears less reliable.
Again, successful counter-proxy warfare can redirect rather than eliminate security competition.
The Gaza ceasefire breakdown risk makes this even harder. The Houthis tied their previous maritime campaign explicitly to Israel’s war in Gaza and reduced attacks after the January ceasefire. They subsequently threatened to resume operations after Israel blocked the entry of goods into Gaza in early March during disputes over extending the ceasefire. This linkage means Red Sea security is partly determined by a conflict hundreds of kilometres away.
That is conflict interdependence. A decision over humanitarian access in Gaza changes Houthi incentives in Yemen, which changes shipping routes through Egypt, which changes freight costs for European and Asian businesses. Regional politics transmits through economic networks globally.
It also means there may be a diplomatic route to reducing Houthi attacks that is cheaper than destroying every missile stockpile. If a durable Gaza settlement removes the political justification the Houthis use for attacks, the organisation faces higher costs in sustaining regional support for them. That does not guarantee disarmament or eliminate Houthi hostility towards the United States and Israel. It changes the political environment in which attacks occur.
This is why military and diplomatic instruments should be complements rather than substitutes. Military force can raise the cost of attack. Diplomacy can reduce the political benefit. The most durable deterrence occurs when both move in the same direction.
The Saudi experience in Yemen is instructive. Saudi Arabia intervened militarily in 2015 expecting to reverse Houthi territorial gains and restore the internationally recognised government. Years of fighting and enormous expenditure failed to eliminate the Houthis, while missile and drone attacks eventually reached Saudi infrastructure itself. Riyadh increasingly moved towards negotiations and de-escalation because the expected value of continued war declined.
This does not prove military action against the Houthis is useless. American objectives are narrower than Saudi Arabia’s former objective of reshaping Yemen’s political order. Washington does not need to capture Sanaa. It needs shipping attacks to stop.
A narrower objective is easier.
But even limited objectives require a theory of termination.
What behaviour ends the American strikes?
How long must attacks stop?
What happens if one rogue launch occurs?
Can the Houthis demonstrate compliance?
Does the United States demand destruction of missile inventories or merely cessation of maritime attacks?
Clear conditions matter because deterrence works better when the target knows how punishment ends.
Otherwise the target can conclude that restraint produces no benefit and continue fighting.
This is one weakness of open-ended rhetoric such as “overwhelming lethal force”. It signals resolve effectively. It communicates the off-ramp less clearly.
Successful coercion needs both.
Do this and punishment follows. Stop doing it and punishment stops.
The second sentence is as important as the first.
The domestic American politics also differ from previous Middle Eastern interventions. Trump campaigned repeatedly against “endless wars” and criticised earlier US nation-building efforts. His supporters generally favour military strength while being sceptical of prolonged deployments.
The Yemen campaign therefore tests whether America First restraint and America First coercion can coexist.
Trump’s foreign-policy instinct is not straightforward isolationism. It is closer to reducing permanent commitments while being willing to use overwhelming force for narrower objectives.
That can produce fewer long occupations but more intense short campaigns.
Whether this is cheaper depends on whether short campaigns actually remain short.
The United States has repeatedly entered Middle Eastern conflicts expecting limited operations.
The region has a way of creating second-order commitments.
One American strike kills an Iranian adviser.
A militia retaliates against a US base.
Americans are killed.
Washington escalates.
The original maritime objective becomes secondary.
This is the escalation-chain risk.
The probability of any one step may be modest.
Repeated interactions compound it.
This is why the Trump administration should define success quantitatively rather than rhetorically.
Commercial shipping returning to the Red Sea.
Insurance premiums declining.
Fewer Houthi launch attempts.
No sustained expansion of American ground involvement.
Reduced Iranian weapons transfers.
Those are measurable outcomes.
The number of targets destroyed is not enough.
Military organisations naturally measure sorties, weapons depots and commanders killed because those variables are observable immediately.
Strategy should measure behaviour changed.
If 100 launchers are destroyed and attacks continue, tactical success has not produced the strategic objective.
If relatively limited strikes cause attacks to stop and commercial vessels return, the campaign succeeded even if much of the Houthi arsenal survives.
This distinction is essential because armed groups do not need to be destroyed completely to be deterred.
They need to conclude that one specific behaviour is no longer worthwhile.
The United States should therefore resist converting freedom of navigation into regime-change logic.
Yemen’s political future ultimately needs a Yemeni settlement involving the Houthis, the internationally recognised government, southern factions, Saudi Arabia and other actors. American air strikes cannot design that settlement.
They can protect shipping while it is negotiated.
That is a much narrower and more achievable role.
The broader economic lesson is that the Red Sea crisis demonstrates how much geopolitical power still comes from controlling physical geography in an economy often described as digital. Financial markets move electronically. Data crosses oceans instantly. Artificial intelligence appears increasingly detached from physical distance.
Trade is not.
Oil.
Containers.
Grain.
Manufactured goods.
They still move through canals and straits.
Suez.
Hormuz.
Bab el-Mandeb.
Malacca.
A relatively weak actor positioned beside one of these nodes can impose costs on economies vastly larger than its own.
This is why maritime security will become more important as geopolitical competition intensifies.
Supply chains optimised for efficiency assume routes remain open.
Security shocks price resilience back into the system.
Firms diversify routes.
Governments rebuild merchant fleets.
Navies receive more funding.
Insurance becomes more expensive.
Again, geopolitics becomes an input cost.
The Houthis have already imposed that cost for more than a year.
Trump now intends to make continuing to impose it much more expensive for them.
The logic is clear.
The outcome is not.
American air power can destroy infrastructure much faster than the Houthis can replace it.
But the United States does not need to win a contest in destruction.
It needs to win a contest in incentives.
The campaign succeeds if Houthi leaders conclude that attacking shipping no longer advances their political or strategic objectives.
It fails if strikes simply create another cycle in which each American attack produces another Houthi reason to retaliate.
That is the distinction between coercion and attrition.
Coercion changes behaviour.
Attrition merely exchanges damage.
After more than a decade of war, Yemen has demonstrated an extraordinary capacity to absorb damage.
The United States should therefore judge this campaign by something much harder than how much it can destroy:
whether the Red Sea becomes safe again without America inheriting another war whose endpoint nobody can define.
