Defense Secretary Pete Hegseth told reporters Monday that the Trump administration's economic campaign against Tehran is inflicting more damage on the Iranian regime than airstrikes, while warning that military force remains on the table if Iran miscalculates.
Speaking in Oshkosh, Wisconsin, during the Pentagon's Arsenal of Freedom tour, Hegseth laid out a two-track strategy: an expanding naval blockade in the Arabian Sea and a new economic offensive designed to choke Iran's access to global markets. He did not rule out resuming what the military calls kinetic strikes, airstrikes and direct military action, but made clear the administration believes financial isolation is the sharper weapon right now.
The remarks came the same day Treasury Secretary Scott Bessent previewed a campaign the administration has labeled "Operation Economic Outcast," warning foreign governments to sever financial ties with Iran or risk losing access to the U.S. dollar system. Together, the two cabinet secretaries signaled a coordinated push across the Defense, Treasury, and State departments to tighten the vise on Tehran after six months of hostilities that The Hill reported have settled into a stalemate.
Hegseth's language left little ambiguity about the administration's confidence in the naval operation. He claimed the United States now controls the Strait of Hormuz, the narrow waterway through which roughly a fifth of the world's oil supply typically passes.
Hegseth told reporters:
"Iran can't run anything through; we can. The world economy realizes that, and so they made a big bet on controlling it, and they can't."
He added that Iran's "economy is in a spiral" and that the blockade is "ironclad," with oil still flowing through the strait under American supervision. The Pentagon chief cast the combined pressure as a funnel, designed to leave Tehran with one exit.
Hegseth said the application of more economic pressure ensures that "the only choice" Iran has is "to come to the table and actually talk about their nuclear program, which is what the president has demanded."
On the question of military force, Hegseth was direct but measured. He acknowledged that airstrikes remain an option if conditions change.
"If we need to use kinetic strikes, we'll use them. If Iran is foolish enough to overplay their hand or mess with the American military, we'll do what we need to do."
But he pivoted immediately back to the economic track: "But economic pressure hurts them the most right now."
Hegseth has faced scrutiny from multiple directions during his tenure at the Pentagon. Some congressional critics, including Rep. Thomas Massie, have accused him of overstepping his authority under the War Powers Resolution in connection with the Iran conflict.
U.S. Central Command backed up Hegseth's claims with data. In a social media post Monday, CENTCOM said the U.S. military has redirected 71 commercial ships, disabled three, and boarded two others since resuming the naval blockade in the Arabian Sea. More than 40 vessels carrying humanitarian aid have been allowed to pass.
Ship-tracking firm Kpler provided independent data on traffic through the Strait of Hormuz. Five vessels crossed the strait on Sunday, down sharply from 25 successful crossings on Saturday and 21 on Friday. The steep drop on Sunday suggests the blockade's grip may be tightening, though the data covers only three days and the cause of the decline is not specified.
Meanwhile, Hegseth has also moved aggressively on internal Pentagon matters. He and the Department of Justice recently launched a joint task force aimed at identifying and prosecuting Pentagon leakers, a step that underscored his willingness to consolidate control over the department's operations.
Treasury Secretary Bessent's Monday remarks added a financial dimension to the military pressure. He described "Operation Economic Outcast" as an effort to force countries around the world to choose between doing business with Iran and maintaining access to the U.S. dollar-based financial system, a choice that, for most economies, is no choice at all.
Bessent offered few specifics about the campaign's mechanics but made the consequences clear for governments that refuse to comply. He told reporters:
"I would expect that very quickly, if they do not respond, then you will see the ramifications of their actions."
When asked whether the approach risked destabilizing global finance, Bessent pushed back.
"Well, we are giving everyone the opportunity to remedy bad behavior, why would I want to blow up the global financial system?"
Bessent said President Trump is personally making calls to world leaders as part of the campaign, and that officials from the Defense, Treasury, and State departments are connecting with their foreign counterparts to demand action on severing ties with Tehran. The breadth of that outreach, spanning three cabinet departments and direct presidential engagement, signals the administration views Iran's financial isolation as a top-tier priority, not a side effort.
Democrats on Capitol Hill have not been shy about targeting Hegseth personally. One swing-district Democrat recently told a crowd she wanted to physically confront him, a remark that drew criticism for its tone even as the lawmaker publicly promoted bipartisanship.
Tehran responded within hours. Mohammad Bagher Qalibaf, Iran's parliamentary speaker, posted on social media Monday dismissing the entire American campaign as posturing.
"Americans know that no one buys their bombast; the United States is not in an economic position to further restrict its relations with other countries."
Qalibaf went further, claiming that Iran's trading partners have privately reassured Tehran that they do not take Washington's warnings seriously.
"Iran's trading partners, both in the media and through messages sent to us, have made it clear that they don't take these statements into account anywhere."
Qalibaf's claims stand unverified. No trading partner is named, and no independent reporting in the available material confirms or denies that foreign governments have sent such assurances to Tehran. The assertion amounts to a counterpunch, an attempt to undercut American credibility without producing evidence.
Hegseth's leadership at the Pentagon has also drawn attention on the home front. Reports about his wife Jennifer Hegseth's reported involvement in department affairs have added a separate layer of public discussion around the Defense Secretary's management style.
The broader context matters. Six months of hostilities between the United States and Iran have produced a stalemate. The nature of that stalemate, whether it is primarily military, diplomatic, or both, is not spelled out in available reporting. But the administration's Monday messaging made one thing clear: Washington believes the path forward runs through Iran's treasury, not its military installations.
Several questions remain unanswered. Which specific countries have received Bessent's warnings? Have any complied? What concrete steps does "Operation Economic Outcast" entail beyond the threat of dollar-system exclusion? When were U.S. airstrikes last conducted against Iranian targets, and what prompted the shift to an economic-first approach?
None of those details emerged Monday. What did emerge was a unified message from two cabinet secretaries: the administration intends to make Iran's economic pain so severe that negotiations become Tehran's only rational option.
Whether Qalibaf's bravado or Hegseth's confidence proves closer to reality will depend on something neither side addressed Monday, whether the countries caught in the middle actually follow through on Washington's demands or quietly keep doing business with Tehran. That is the only question that matters now, and neither capital has answered it.
