Venture capitalist David Sacks, who is President Donald Trump’s AI and crypto czar, warned of potentially catastrophic consequences if the U.S.-Israel war on Iran continues.
In an episode of the All-In podcast on Friday, he said “we should probably find the off-ramp,” noting Iran’s military has been devastated.
“This is a good time to declare victory and get out, and that is clearly what the markets would like to see,” Sacks added.
But he said there’s a faction within the Republican Party and elsewhere who wants to escalate the war, send in ground troops, and seek regime change.
In fact, Trump initially pointed to regime change when the war started two weeks ago, but has since downplayed it. Meanwhile, he ordered the U.S. military to attack Iran’s top oil-export node, Kharg Island, and send 2,500 Marines from Asia to the Middle East.
The White House didn’t immediately respond to a request for comment.
Sacks flagged concerns of a tit-for-tat escalation spiral in Iran that could see both sides targeting each other’s oil and gas infrastructure.
By that point, resuming energy flows by reopening the Strait of Hormuz, which Iran has effectively closed, won’t matter because restarting oil and gas production wouldn’t be possible, he said.
An even worse scenario could unfold if desalination plants are destroyed, Sacks warned. They provide most of the region’s fresh water and have already been targeted.
“If you see that type of destruction continue, you could literally render the Gulf almost uninhabitable,” he explained. “I mean you’re not going to have enough water for 100 million people, and human beings just cannot survive very long without water. So that would be a truly catastrophic scenario, and we’re talking about destroying the Gulf states economically and then also from a humanitarian perspective.”
While Israel isn’t as vulnerable, Sacks also pointed out the country has been hit hard by Iranian attacks, adding that “Israel could just be destroyed or very large parts of it” if the war drags on for weeks or months.
In a scenario where Israel is facing such a serious threat, that raises the risk of it escalating the war even further and perhaps contemplate the use of nuclear weapons, he said.
“So there’s a lot of scenarios here, a lot of really frightening scenarios about where escalation could lead,” Sacks continued. “And even though the United States is a much more powerful country than Iran, they essentially have a dead man’s switch over the economic fate of the Gulf states and even potentially beyond that.”
Given the “horrifying directions” that further escalation may produce, he said it’s time to look at de-escalation, which could entail a ceasefire agreement or negotiated settlement.
The comments come amid reports that some administration officials are also pushing Trump to seek an off-ramp to the war as the recent spike in oil prices raises political risks.
Sources told Reuters that economic advisers and officials have told him that rising gasoline prices could quickly erode already-weak domestic support for the war. More hawkish voices, however, are urging Trump to continue and prevent Iran from developing a nuclear weapon.
“He is allowing the hawks to believe the campaign continues, wants markets to believe the war might end soon and his base to believe escalation will be limited,” a Trump adviser told Reuters.
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