Six months into the war with Iran, the Trump administration faces a convergence of problems, dwindling missile inventories, a Senate that left town without funding the fight, and an adversary that shows no sign of capitulating.
President Trump told Axios on Sunday that he is "low-keying it" with Tehran. "We are only semi-negotiating with them," he said. "We are just watching Iran with its huge inflation and the fact they have no money." The shift toward economic pressure comes as military experts estimate Patriot interceptor stocks have fallen at least 65 percent from pre-war levels and THAAD missile defense inventories have dropped by more than a third.
Seventeen American troops are dead. U.S. Central Command has turned away 53 commercial vessels since the naval blockade began, and shipping data shows zero tankers have loaded at Iran's main oil terminal on Kharg Island. Iran's annual inflation hit 88.6 percent by late June, and the government in Tehran has asked its own citizens to ration electricity. Both sides are bleeding, but neither side is blinking.
War Secretary Pete Hegseth pitched Senate Republicans on a record $1.5 trillion defense budget. He framed refusal to fund the department at that level as "the single greatest danger facing the country." The Senate was unmoved. Members departed for a five-week summer recess without advancing the defense budget or the separate war-funding package the Pentagon says it urgently needs.
The budget standoff leaves the Pentagon pressing defense contractors to resupply munitions it has already burned through, without a clear guarantee that Congress will pay the bill. Deputy War Secretary Steve Feinberg tried to force the issue with a memo, first reported by the Washington Post, giving arms manufacturers 21 days to come back with plans for "significantly faster" deliveries or expanded production lines.
Whether a 21-day ultimatum can fix supply chains that take years to build is an open question. What is not open to question is the math: the war is consuming interceptors and precision munitions faster than American factories can replace them, and the branch of government that controls the money just walked out the door.
Hegseth's difficulties on Capitol Hill are not new. Republican Sen. Thom Tillis recently compared Hegseth's missteps unfavorably to other Cabinet nominees, and the war secretary has drawn scrutiny over a series of controversial personnel and policy decisions since taking office.
Late last month, Trump confronted Hegseth at Camp David about being kept in the dark on how far missile stocks had actually fallen. The Washington Post reported the exchange, and the story landed hard, raising questions about whether the president's own defense chief had concealed the severity of the shortage.
Trump moved quickly to contain the damage. He called the coverage treasonous, threatened prison for the leakers, and declared himself "extremely happy" with Hegseth. Days later, Trump posted on Truth Social insisting that American stockpiles remain enormous and that production is running at full capacity.
The public show of support papered over the tension but did not resolve the underlying problem. If the stockpiles are as healthy as Trump's social media posts suggest, there is no obvious reason for Feinberg's urgent memo to manufacturers, or for Hegseth's plea to senators that underfunding the Pentagon represents the gravest threat the country faces. The administration's own internal actions tell a different story than its public statements, and the gap between the two has not been explained.
That gap fits a broader pattern of turbulence around Hegseth's Pentagon. He has forced out senior military leaders and pushed through organizational changes that have generated friction both inside the building and on Capitol Hill.
On Saturday, Iran issued a list of conditions for reopening the Strait of Hormuz: Washington must pay war reparations, lift sanctions, end the naval blockade, and remove American forces from the region. Tehran wants compensation for damage sustained during the conflict.
Nearly every condition Iran listed already appeared in the memorandum of understanding Trump signed on June 17. That agreement collapsed less than a month later when American strikes resumed and the blockade was reimposed on July 14. Iran is now demanding, in public, terms it already extracted once in private, terms the administration agreed to and then walked away from.
The sequence matters. Tehran's willingness to recycle the same demands signals that the regime does not plan to submit to Trump in the near future. Iran is hurting, 88.6 percent inflation and electricity rationing make that clear, but its leadership appears to have calculated that the Americans are hurting, too, and that time is on Tehran's side as long as Washington's missile stocks keep shrinking and Congress keeps stalling.
Details also emerged Saturday about a potential arrangement involving Oman to manage partial control of the strait, though the specific terms of that proposal remain unclear. Whether that channel leads anywhere depends on whether either side is willing to make concessions the other can accept, a bar neither has cleared so far.
Hegseth's credibility problems extend beyond the budget fight. His planned troop reductions in Europe were halted before they could be formally announced, and a separate controversy over Navy promotion decisions drew additional scrutiny to his management of the department.
As if the Iran stalemate were not enough, Israeli Prime Minister Benjamin Netanyahu rejected Trump's 15-point plan for the next phase in Gaza on Sunday. Netanyahu said the IDF will not pull back until Hamas has genuinely disarmed. Hamas leadership, meanwhile, is demanding that Trump pressure Netanyahu to move forward with the peace plan.
Trump is now caught between an ally that refuses his terms and an adversary that insists he enforce them. The 15-point plan's specific provisions have not been made public, but Netanyahu's flat refusal narrows the diplomatic space the administration has to work with, and it removes one of the few potential pressure points Washington might have used to bring Iran to the table through a broader regional settlement.
The Camp David confrontation, the budget collapse, and Netanyahu's rejection all landed within weeks of each other. Each problem compounds the others. A war secretary who cannot secure funding from his own party's Senate majority is poorly positioned to manage a conflict that is already straining the president's confidence in his leadership.
Trump's pivot to economic pressure has a factual basis. Iran's economy is in serious distress. No oil is leaving Kharg Island. Inflation is approaching 90 percent. The regime is rationing power to its own people. Those are real consequences of the blockade, and they will deepen as long as the naval cordon holds.
But economic pressure is a long game, and the administration's military position is deteriorating on a shorter timeline. Patriot and THAAD stocks do not replenish themselves. Defense contractors cannot spin up new production lines in 21 days no matter what memo they receive. And a Senate that could not pass a defense budget before a five-week vacation is unlikely to return with a sudden appetite for a $1.5 trillion spending bill.
The administration's challenge is straightforward: it started a fight it now lacks the ammunition to sustain at the current pace, the legislature will not fund a resupply, the adversary knows it, and the allies Washington needs for a diplomatic exit are not cooperating. Every week the Senate stays on recess, the gap between what the Pentagon needs and what it has grows wider.
Wars do not pause for congressional vacations, and adversaries do not wait for appropriations bills. If the administration wants to finish what it started with Iran, someone in Washington needs to act like it.
