The United Arab Emirates spent eight years and a fortune trying to own a stretch of water. It bought proxies, seized islands, built runways and naval bases along both banks of the Bab el-Mandeb, and sold the whole program to Washington as the wall that would keep Iran out of the Red Sea. In September the wall fell, and the water passed to Iran’s closest ally. The chokepoint that a decade of state planning was meant to secure is now held by the Houthis, allied with Tehran. There is no cleaner illustration of what happens when a government sets out to engineer a region from above.
The scheme was ambitious in the way that only confiscated wealth allows. From 2018, Abu Dhabi assembled what analysts called a circle of bases around the Gulf of Aden: the island of Socotra, run as something close to an overseas possession; airstrips on the smaller islands; a base on Mayun in the middle of the strait; and across the water, footholds at Berbera and Bosaso. The declared purpose was to watch the sea lanes and interdict Iranian weapons bound for the Houthis. The method, in Yemen as earlier in Libya, was to arm and fund sub-state clients against a recognized government, and to convert each client into a lease on a port or a runway. This was state capitalism turned outward, financed by oil rents rather than earned in exchange, extending itself down the African coast one base at a time. The template was not new. In Libya the same government had spent years backing a general against the recognized administration in Tripoli, the sharpest earlier case of a pattern that ran from North Africa to the Horn. One survey of the Emirati approach put it bluntly: Abu Dhabi favors sub-national clients because a pliable faction, unlike an accountable government, can be rented for a base and discarded once it has served.
The logic was mercantilist to the core. A merchant wants the strait open and does not care who owns the shore, because commerce needs only passage, and passage is cheapest when no one is fighting over it. A state wants the strait owned, garrisoned and denied to rivals, because control is the currency it deals in. The whole Emirati project rested on the premise that a waterway is a possession to be captured rather than a commons that trade keeps open on its own. That premise is what put warships and client militias where cargo vessels had been managing perfectly well.
The engine of the whole design was the arms trade, and the strike on Mukalla exposed it in miniature. What Saudi jets destroyed in the harbor was a shipment of weapons and vehicles that had crossed from Fujairah to arm the Emirati client, one consignment in a decade of them. The rifles, drones, and armored vehicles that fed every faction in Yemen came, at the source, from the industries of states that profit whether their customers win or lose. War of this kind is not a market failure. It is a market that exists only because governments create it, subsidize it and shield it from the reckoning that would close any honest business.
None of it was cheap, and none of it faced the discipline that kills a bad plan quickly in a market. A firm that misallocates capital goes bankrupt and stops. A state that misallocates other people’s money can keep a doomed project running for years on subsidy and decree, until reality presents the bill in full. At the Bab el-Mandeb the bill came due in a single week.
The plan collided with another state’s plan. In December the Emirati-backed Southern Transitional Council pushed into the eastern provinces that run along Saudi Arabia’s border, and Riyadh, reading the move as an attempt to seat a client statelet on its frontier, bombed the port of Mukalla and the Emirati weapons shipment sitting in it, landed from Fujairah. The recognized government gave Abu Dhabi twenty-four hours to leave. Within about eight days the Emirates abandoned Socotra, Mayun, and the coast, dismantling the bases as they went. The coalition later accused Abu Dhabi of running a covert operation to spirit its client, the separatist leader, out by sea and on to the Emirates. By early January the council it had built and armed had dissolved itself.
The man who had directed the project for a decade, the ruler of Abu Dhabi, had planned for every contingency except the one that arrived. This is the knowledge problem that economists Ludwig von Mises and Friedrich Hayek identified, transposed onto the map. The planner cannot see far enough ahead, cannot price the reactions of others, cannot know what his own scheme will call into being. He commands resources he did not earn toward ends he cannot foresee, and the result is waste at a scale no private actor could sustain. The difference between a central planner in a ministry and a central planner in a defense palace is only the size of the wreckage. He spends what he has taken rather than what he has made, so the ordinary signal that tells a builder to stop never reaches him. The bases rose as monuments to permanence and came down as scrap, and the ruler who ordered both will pay for neither.
The wreckage did not stay Abu Dhabi’s private problem. The entire architecture had been justified as a barrier against Iran, and when it fell it produced the barrier’s opposite. Iran was already at war with the United States and squeezing the Strait of Hormuz, and Saudi Arabia had rerouted its oil exports through the Red Sea to compensate, which made the far end of that route matter more than it had in years, exactly as it fell undefended. The Houthis walked in. They took Mokha in September, the island of Perim the following day, the strait itself within seventy-two hours, and the Hanish islands soon after, ground the Emirates had held and then vacated. American and allied assessments placed Iranian officers on the ground and the Revolutionary Guard directing the advance, its aim to install the Houthis as the guarantor of passage through the strait, the posture Tehran already holds at Hormuz.
The intervention had manufactured its own nightmare. Every dollar spent to keep Iran off this water helped clear the path for Iran’s proxy to command it. This is the pattern the non-interventionist tradition has documented for generations. Interference abroad does not fail cleanly and quietly. It fails by breeding the outcome it was sold to prevent, and then the failure is cited as the reason for the next intervention. Blowback is not a malfunction of the interventionist state. It is the machine working as designed.
None of this makes Saudi Arabia the hero of the story. Riyadh belongs to the same school of planning, and its counteroffensive liberated no one. It swapped one set of foreign-backed clients for another and restored a government that survives at the pleasure of its patrons. Two oil monarchies ran competing blueprints for the same country, spent a decade and uncounted lives imposing them, and produced between them the vacuum that a third power’s militia then walked into. The contest was never between order and chaos. It was between rival plans, and the people of Yemen were the ground on which both were tested.
There is an old line, coined by turn-of-the-century progressive essayist Randolph Bourne and later adopted by libertarian Murray Rothbard, that “war is the health of the State.” The decade of engineered conflict in Yemen was very healthy indeed for the states that waged it and for the interests wired to them. It kept the arms moving, the bases rising, the contracts signed and the ruling houses indispensable to Washington. Rothbard stated the mechanism without ornament: the state thrives on war. What the state does not do is carry the cost. The cost of the Yemen project fell on Yemenis, hundreds of thousands driven from their homes across the years of fighting and tens of thousands more displaced in the September offensive alone. It falls now on ordinary buyers of oil, with Saudi crude loadings through the strait down by more than a third and prices climbing past a hundred dollars a barrel after a related strike shut a Saudi pipeline. The planners externalized the bill, as states always do, onto the people who never had a voice in the plan and never saw the ledger. Bourne’s point cut deeper than the balance sheet. War abroad is the health of the state at home, the occasion on which it swells in power and silences dissent, and the Gulf monarchies are textbook cases, their war economies and their domestic repression feeding on the same permanent mobilization. The lasting cost is not only the displaced Yemeni and the overcharged motorist. It is the entrenchment of the very governments whose hunger for control produced the war to begin with.
Every party to this called its war a defense. The Emirates were defending the region from Iran, the Saudis their border, Iran and its clients Yemen itself from aggression. Rothbard identified this as the founding myth of the warfare state, the claim that war is the state shielding its subjects, when the record shows the reverse. The subjects are shielded from nothing and billed for everything. The ledger of a decade in Yemen reads in famine, cholera, ruined cities and a population that has known little but siege, while every government involved emerged with its grip on its own people intact or tightened.
It is worth naming the American role plainly, because it ran underneath the whole affair. The Emirati and Saudi arsenals were stocked by Western arms industries. The adventures were thinkable only because a superpower stood behind the adventurers with weapons, intelligence, and the assurance of a patron. Israel’s own maneuver on the same board, its recognition of the breakaway republic of Somaliland to buy a listening post near the strait, was another piece of state-to-state deal-making dressed as diplomacy. This is the empire that non-interventionists have warned of for a century, the one the Old Right saw coming when it read Bourne and concluded that a garrison posture abroad and a free society at home cannot survive together. The Gulf scheme was a franchise of that empire, run by junior partners flush with sovereign wealth, and it failed the way imperial schemes fail, by generating the disorder it promised to abolish.
There is one encouraging detail in the rubble. Washington, for once, has shown no appetite to send in forces and hold the strait itself, even with an American base sitting twenty miles across the water in Djibouti. That restraint is the right policy, though it was reached by exhaustion rather than by conviction. The deeper lesson is not that the plan needed better execution. A cleverer intervention would have failed too, because the error was in the premise, that a government can seize and hold and administer a foreign waterway against the will and the interests of everyone around it. Trade does not require that. Only empire does.
The answer is the one the antiwar tradition has offered from the start. Stop financing the clients. Stop selling the arms. Stop underwriting the schemes and guaranteeing the schemers. Let the states that insist on playing this game bear their own costs rather than shifting them onto the displaced abroad and the taxed at home. Abu Dhabi’s ring of bases is scrap, and Tehran’s ally holds the water. A decade of planning by wealthy states promised order and delivered its reverse, which is the one result the central planning of nations can be trusted to produce. The merchants never needed the strait owned. Only the planners did, and the planners lost it.
