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The toll castle of Pfalzgrafenstein once exploited a narrow stretch of the Rhine. Its rulers could lower chains across the river, stop passing ships and charge for access to a waterway they had done nothing to create. That arrangement is an old illustration of economic rent: income extracted by making a cheap or abundant resource artificially scarce.

The danger is returning in modern form. After the latest Gulf war, Iran is considering charging ships to pass through the Strait of Hormuz, the route that carried about 20% of the world’s oil supply before fighting began. Oman may join it, while Donald Trump has suggested that America should also collect fees for guarding the strait. A passage long treated as open could become a source of rival tolls enforced not with castle chains, but with missiles, drones and the threat of piracy.

When restrictions reward capture

Trade barriers do more than raise costs. As the economist Anne Krueger argued in her work on “rent-seeking societies”, they create valuable privileges that groups then compete to capture. Instead of producing goods or improving services, people expend resources on lobbying, bribery and legal manoeuvres. At sea, the same struggle can become violent because control of a shipping lane creates the power to demand payment from everyone who uses it.

Freedom of navigation displaced that system over the past two centuries. Prussia ended the Pfalzgrafenstein toll in 1867 after gaining control of both banks of the Rhine, and an international treaty abolished Rhine tolls the following year. The great powers had similarly forced Denmark to stop charging ships for Baltic access in 1857. Open waterways were not a natural condition; they were a public good imposed and protected by states strong enough to prevent local rulers from erecting tollbooths.

The hegemon’s bargain

Britain supplied that protection across much of the world’s seas in the 19th and early 20th centuries, including in the Persian Gulf. After Britain withdrew from east of Suez in 1971, America inherited the role. Gulf states became independent but remained under an American security shield, backed by a naval base in Bahrain.

This history fits Charles Kindleberger’s theory of hegemonic stability. The global economy depends on public goods, such as financial order and safe shipping, whose benefits are widely shared. A dominant power is unusually able to bear the cost of providing them and willing to do so because its large economy captures a substantial share of the resulting gains. For decades, America judged that cheap, unrestricted movement for merchant vessels served its own economic interests as well as everyone else’s.

That bargain is weakening. America has less appetite for deploying forces in the Gulf, and cheap drones allow smaller powers to threaten ships from much farther away than the cannon range that once defined territorial waters. If the hegemon neither guarantees passage nor deters toll collectors, the incentives shift from keeping trade open to competing over the rents created by insecurity.

Why a coalition may not be enough

Middle powers could in theory replace one dominant guarantor with collective action. The Rhine’s toll-free regime was established by several German states together with France and the Netherlands. Yet research by Anwesha Banerjee, Ottmar Edenhofer and Ulrike Kornek suggests that a more even distribution of power encourages countries to free-ride and jockey for advantage. Every member wants safe passage, but each has an incentive to let others pay for it. Such a coalition may therefore struggle to keep Hormuz open.

The Rhine now offers a second warning. A prolonged European heatwave and drought has lowered the river at Kaub to only six centimetres, compared with a previous record low of 25cm in 2018. Heavy tankers can no longer pass, and Oxford Economics estimates that the disruption will reduce German GDP growth by 0.2 percentage points this year.

The deeper risk is therefore larger than the reappearance of tolls. Political fragmentation can turn shared routes into opportunities for rent extraction, while climate change can make the routes themselves unusable. Freedom of navigation is valuable precisely because no country can create it alone. Preserving it requires governments capable of supplying public goods even when the costs are concentrated and the benefits spill far beyond their borders.