The horizon is not so far as we can see, but as far as we can imagine

Month: March 2022 Page 1 of 4

Putin’s Goals, A Map, For Discussion

I didn’t make this map and it isn’t based on what I think. I put it up because reader GrimJim sent it to me and I think it’s well done and a good place to start a conversation.

Putin's Goals by GrimJim

Reorienting About How Well Russia Is Doing In Ukraine

It’s consensus in the West now that Russia’s military sucks.

Does it?

As Scott Ritter pointed out and as I find it shocking that almost no one else pointed out, Russia invaded with a lot less men than Ukraine has. Regular forces, plus reserves, plus border guards, plus miscellaneous other groups, Ukraine had about 600K. With allies from the Republics, Russia had about 190K.

Russia has air superiority, but not air supremacy over Ukraine, but the bottom line is that they invaded with about a 1/3 ground force disadvantage.

When you look at it that way, the narrative that NATO trained troops are so much better than Russian ones starts looking questionable. Say what you will about the Russians, they have pushed the Ukrainians back and I very much doubt the Western casualty figures are accurate. Perhaps Russian troops are actually superior to NATO ones. It’s certainly at least as viable as a narrative.

There are two important things to note here:

First, the number of troops supports the Russia claim that they never have intended to conquer and occupy the entire country, because even if they thought Ukrainian morale was weak, in no way is a 1/3 outnumbered ground force sufficient to do so.

Second, Ukrainian forces in the east are not getting significant resupply. All roads aren’t held by the Russians, but because of Russian air superiority they are closed to significant supply convoys. As I understand it, Ukrainian forces in the East are down to about 9 days of supply.

If Russia keeps them out of resupply, and keeps them unable to move (fleeing down those roads means Russia’s air force gets a turkey-shoot) then when they run out of supply, they’ll collapse and be captured or killed en-masse.

I don’t know if this the correct picture of the war, I’m not a military analyst and it’s not an area of significant interest to me.

But let’s say this assessment is correct. The entire narrative we’ve been fed about the war will turn out to be false, and will be proven false in a way which cannot be denied.

We’ll know soon enough. It’s hard to be sure. Ukraine is effectively refusing to negotiate, so they think they still stand a chance and they may know something we don’t.

I’ll place one market in the ground, though: if a claim is made that Russia used chemical weapons I will not believe it without incontrovertible evidence. They have no reason to do so. If they want to increase their military force, they can do so easily enough with conventional weapons. Despite rhetoric they haven’t been using strategies like level bombing; they’ve only used a few of their most dangerous missiles and so on. They can ramp up force with causing the sort of backlash chemical weapons will cause. So if there’s a claim, I will suspect it is false flag.

Cui Bono

Finally, as I have stated many times before, the analysis has nothing to do with any preferences of mine about who should win. I want the war over and civilians safe, and I was a critic of Putin back when liberals thought he was their man in Moscow.


Week-end Wrap – Political Economy – March 27, 2022

by Tony Wikrent

Strategic Political Economy

In a World on Fire, Stop Burning Things

Bill McKibben [New Yorker, via The Big Picture 3-26-2022]

The truth is new and counterintuitive: we have the technology necessary to rapidly ditch fossil fuels….

…the era of large-scale combustion has to come to a rapid close. If we understand that as the goal, we might be able to keep score, and be able to finally get somewhere. Last Tuesday, President Biden banned the importation of Russian oil. This year, we may need to compensate for that with American hydrocarbons, but, as a senior Administration official put it,“the only way to eliminate Putin’s and every other producing country’s ability to use oil as an economic weapon is to reduce our dependency on oil.” As we are one of the largest oil-and-gas producers in the world, that is a remarkable statement. It’s a call for an end of fire.

“Beauty and wonder of science boosts researchers’ well-being”

[Nature, via Naked Capitalism Water Cooler 3-21-2022]

“Scientists’ ability to experience wonder, awe and beauty in their work is associated with higher levels of job satisfaction and better mental health, finds an international survey of researchers. Brandon Vaidyanathan, a sociologist at the Catholic University of America in Washington DC, and his colleagues collected responses from more than 3,000 scientists — mainly biologists and physicists — in India, Italy, the United Kingdom and the United States. They asked participants about their job satisfaction and workplace culture, their experience of the COVID-19 pandemic and the role of aesthetics in science. The answers revealed that, far from the caricature of scientists as exclusively rational and logical beings, “this beauty stuff is really important”, Vaidyanathan says. “It shapes the practice of science and is associated with all kinds of well-being outcomes.’”

Fed headed for crack up?

Mike Norman [Mike Norman Economics 3-26-2022]

Mike doing some projections this week on by how much or perhaps how fast the Fed can increase its policy rates while avoiding insolvency, ie a situation where their current interest income would be exceeded by their current interest payable…

You can see here current UST yields are less than the Fed’s overnight rates (inverted) out to 8 weeks … no bueno…

To be safe they may want to somehow pivot from the current perhaps implied policy of an acceleration in the increase in their policy rates to a policy of acceleration in their rate of asset/liability reduction… keep an eye out for this pivot…

Thomas Lifson [, via Mike Norman Economics 3-22-2022]
(the not-so-hidden agenda. reassertion of unquestioned American primacy in the world. Not that this is anything new.)

Starving a People, Committing a Genocide: Biden’s Sanctions on Afghanistan

[Counterpunch, via Naked Capitalism 3-20-2022]

Developing Countries Strained by Rich-World Monetary Tightening

[The American Prospect, March 25, 2022]

A new report shows how rising commodity prices, on top of macroeconomic tightening by the Fed, could spark riots in low- and middle-income countries.

The epidemic

Italian study shows ventilation can cut school COVID cases by 82%

[Reuters, via Naked Capitalism 3-23-2022]

Open Thread

Use to discuss topics unrelated to recent posts. (So no Ukraine/Russia related stuff.)

March of De-Dollarization: Russia Selling In Rubles

So, as many readers will have heard, Russia has said it will only accept rubles in exchange for its exports to “hostile nations” — which is to say, those nations who have sanctioned it over Ukraine.

The main thing to understand is that the West froze hundreds of billions of dollars of Russian reserves on account in the West. They sold us stuff for Euros and dollars and we will now not let them use those dollars or Euros. Sanctions mean that even the dollars and euros they have cannot buy many, perhaps most things, in most Western countries and Japan.

So selling us anything in dollars and euros doesn’t make much sense: they can’t use them without exchanging them for other currencies, and our sanctions make that difficult, since they’re closed out from our banking system.

Thus, rubles. An additional advantage of this is that it increases the value of the ruble, which had collapsed under sanctions.

In order to buy Russian oil and gas, Europeans will have to get rubles. Russians are unlikely to want a lot of euros or dollars because they’re almost impossible to spend, so Europe will probably have to buy Yuan and Rupees, then trade those currencies for Rubles. Paying with gold isn’t really practical, because it would have to be physically shipped to Russia or on account with a country they trust (China, India, a few others). Obviously gold in Western banks is not safe.

Russia’s main exports are oil, gas, wheat and minerals. There are usually other sources, but without Russia there aren’t enough to satisfy world demand. Sanctions on Russia, because they are such a big wheat exporter, may wind up killing a few million people in the global South, more than will be killed in the war.

From the point of view of the West, this is a continuation of de-dollarization. If Saudi Arabia also sells oil to China in Yuan, it will be a big deal. Prices are still set in dollars, but I expect that may end fairly soon.

Payment systems are being set up, and the world will split into two different trade areas. China wants another five to ten years before the big (inevitable) split with the West, they may or may not get it, but if they have any sense they won’t allow Russia to be choked out. They certainly aren’t going to cooperate with US sanctions, and that means they need to cleanly separate their financial system from ours, so that funds can’t be seized in transit, executives can’t be locked up and so on.

The Russians didn’t expect this, they were taken by surprise. Probably because, in fact, it’s a weapon that can only be used against a country like Russia (as opposed to Venezuela or Iran or Afghanistan), once. No one outside the West can now trust the West’s system, and everyone with sense will want their reserves kept elsewhere.

This is mostly a good thing, the West has terribly abused its currency primary to hurt other nations, even before the abuse of sanctions which largely accelerated under Clinton. Control of dollars was part of the arsenal used to keep the South poor and the US in control. China was able to get around this because of American greed and stupidity, and now that it has, it has a veto. Since Russia being taken out will lead it to be surrounded by enemies, it is going to use that veto. Again, Russia cannot be choked out by financial and economic sanctions if China does not permit.

I have been writing about this for almost 20 years now, it was clear it would happen eventually but exactly when and how were unclear. For a few years I’ve been saying we were moving to a Cold War world, and we are.

The difference is that unlike in 1950 or 2000, the West is not clearly stronger than the coalition against it. The USSR was always weaker economically, and though for much of the 50s and 60s they had higher growth (something forgotten today), in retrospect and for some of the smarter people at the time, the outcome was never in doubt, it just needed to be managed so it didn’t turn into World War 3.

This time the outcome is in doubt, and I think the smart money would bet slightly against the West, maybe 3/2. The wild card is climate change, which will hit China very hard, but could also do great damage to Europe and America.

Putin was foolish to get into this situation, reserves should have been withdrawn, but this is a smart move. It’s also going to hurt Europe a lot and damage German industry, whose costs will skyrocket (I have little sympathy, given that Germany has used the Euro to basically de-industrialize most of the rest of the EU.)

The post-American hegemony world isn’t quite here, but it’s being born. Welcome to the Age of War and Revolution and the Twilight of the Neoliberalism.


Clarity on Putin’s Aims

This video which I first saw at Naked Capitalism, is the best explainer of what Putin is probably trying to do, why and whether he’s achieving his goals.

I don’t endorse all of it, but it’s worth watching.

The first 10 minutes alone, if you aren’t inclined to more.

Whataboutism, Justice And What To Do When We’re As Guilty As Russia

So, these days, whenever one points out that America, Britain and various other nations have committed the exact same fundamental war crime as Russia: invading another country which has not attacked you first, the rejoinder is always “whataboutism.” The idea is that just because we did something bad doesn’t mean we shouldn’t punish others for doing the same thing, even though we were never punished.

I spent quite a bit of time thinking about this over the last few weeks. It’s a version of “two wrongs don’t make a right.”

I disagree that one should punish someone else for doing what we did ourselves that we weren’t punished for. It’s not justice, it’s wrong, and it destroys all respect for law and for those who insist “me and my friends can destroy whoever we want, but you can’t, because you aren’t one of us.”

At a fundamental level this is one reason so many Chinese and Indians support Russia, not the Ukraine or the West. (The other is that they feel NATO pushed Russia into a corner. You may disagree but I see this over and over again.)

Back in 2017 there was a narrative that Russia interfered in the US election and that it was the worstest thing ever, a great crime and an outrage. Let us assume that Russia did try to influence the election (I sure would, if I were them.)

Americans have interfered in other countries elections many times, on top of launching multiple coups. So when Americans squeal about Russian election interference, I just laugh. Heck, back in 96 the US bragged about helping get Yeltsin elected. You can see a page from the Time article about the interference.

So I don’t care if Russia interfered.

If, however, Americans suddenly realized “Oh my God! Foreign election interference is terrible and we now understand that it shouldn’t be done”, then the principled response would have been for the US to go to Russia and say, “look, we’ve both done it and we both did the wrong thing. Let’s make a pact that neither of us will interfere in foreign elections ever again.”

Now, no one can take Western government mewling about how evil Russia is seriously who has a memory and isn’t a hypocrite. Some individual Westerners, yes: those who opposed Iraq, for example. But governments who went into Iraq or Libya or engaged in various other wars? Grow up.

When America goes on and on about this all that China and India and so do is roll their eyes. They know Western objections aren’t because it’s illegal or unjust or evil, it’s just about power. Nor is it about “territorial integrity.”

So what would we say and do if we were sincere?

We are sanctioning Russia for its attack on Ukraine. At the same time we now realize that our attacks on Iraq and Libya were also unjustified war crimes. We pledge 10 trillion dollars in reparations to Iraq and 5 trillion in reparations to Libya over the next 10 years. We will remove all sanctions from Afghanistan so that their population no longer starves and we will no longer supply Saudi Arabia with weapons, munitions or military aid until it stops its war on Yemen.

Putin is a war criminal, but so are many US politicians. We will immediately start war crimes trials against George W. Bush, Rumsfeld, Cheney, Barack Obama and Hilary Clinton among many others for their roles in Iraq and Libya. We understand that Tony Blair and other responsible UK politicians will also be tried for their participation and we urge other countries involved in Iraq and Libya to do the same.

We call for Russia to remove Putin from power, and try him for his war crime as well. All sanctions will be removed immediately if Russian troops withdraw from Ukraine.

We are sorry that we had to see this war crime committed against Ukraine before we recognized how heinous it was, and promise we will never again attack a country which has not attacked us or a country we are allied to.

Now, of course, the idea that the American government would ever say something like this is beyond ludicrous, but that’s the point.

The West isn’t sanctioning Russia because they are bad, and no one is required to help the West sanction Russia for moral reasons because what we’re doing has nothing to do with morality or justice. If it did, we would either have acted differently in the not very distance past and present (Yemen, Somalia is also being bombed, Afghans are starving) or we would now apologize and hold ourselves responsible for our past actions.

Sanctions and aid for Ukraine, from governments in the West have nothing to do with morality, and everything to do with power and interest.

Still, it’s interesting to think about how we would act if our societies were run by anyone ethical.


Week-end Wrap – Political Economy – March 20, 2022

by Tony Wikrent

Strategic Political Economy

Orwell Was Right (excerpt)

Matt Taibbi [TK News, via Naked Capitalism 3-14-2022]

The ideal citizen of Orwell’s Oceania bubbled with rage a mile wide and a millimeter deep and could forget in an instant passions that may have consumed him or her for years. We just did this, with a pandemic that had the country steaming with indignation until it was quietly declared over the moment Putin rolled over Ukraine’s borders. We switched from “the pandemic of the unvaccinated” to “Putin’s price hikes” in a snap. National outrage moved a few lobes over with zero fuss, and now we hate new people; instead of “anti-vax Barbie,” we’re barring Russian and Belarussian kids from the Paralympics.

“At least NINE House Democrats test positive for COVID after party held maskless retreat in Philadelphia”

[Daily Mail, via Naked Capitalism Water Cooler 3-18-2022]

I include this under “Strategic Political Economy” because it illustrates the extreme arrogance and stupidity of USA ruling elites — including Democratic Party elites. The have failed completely to confront an epidemic by refusing to even consider major expenditures such as reworking the ventilation systems and air filters of all buildings. As Lambert Strether noted: “Closed, close-contact, crowded, lots of talking, probably shouting and singing, no masks. What did they think was going to happen? The outcome they all worked so hard to create; that’s what happened.” 

Say hello to Russian gold and Chinese petroyuan 

Pepe Escaobar [Vineyard of the Saker, via Mike Norman Economics 3-15-2022]

It was a long time coming, but finally some key lineaments of the multipolar world’s new foundations are being revealed.

On Friday, after a videoconference meeting, the Eurasian Economic Union (EAEU) and China agreed to design the mechanism for an independent international monetary and financial system. The EAEU consists of Russia, Kazakhstan, Kyrgyzstan, Belarus and Armenia, is establishing free trade deals with other Eurasian nations, and is progressively interconnecting with the Chinese Belt and Road Initiative (BRI).

For all practical purposes, the idea comes from Sergei Glazyev, Russia’s foremost independent economist, a former adviser to President Vladimir Putin and the Minister for Integration and Macroeconomics of the Eurasia Economic Commission, the regulatory body of the EAEU.

“Saudi Arabia Considers Accepting Yuan Instead of Dollars for Chinese Oil Sales”

[Wall Street Journal, via Naked Capitalism Water Cooler 3-15-2022]

“Saudi Arabia is in active talks with Beijing to price some of its oil sales to China in yuan, people familiar with the matter said, a move that would dent the U.S. dollar’s dominance of the global petroleum market and mark another shift by the world’s top crude exporter toward Asia…. China buys more than 25% of the oil that Saudi Arabia exports. If priced in yuan, those sales would boost the standing of China’s currency. The Saudis are also considering including yuan-denominated futures contracts, known as the petroyuan, in the pricing model of Saudi Arabian Oil Co. , known as Aramco.” • Since the dollar is now evidently a pure form of power projection by the United States, it’s not surprising that other sovereign states would want to get out from under it, if they can.

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