WHY Sanctions have FAILED against RUSSIA – Inside Russia Report

May 21, 2022

A lovely conversation detailing how the ordinary Russian adapted to sanctions.

Michael Hudson: Interview with RT – Transcript

May 21, 2022

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Michael Hudson’s interview with RT – May 19 2022.

Peter Scott, RT anchor: Joining us now is Michael Hudson, economist and author of “Super-Imperialism” and the recently-published “Destiny of Civilization”. Welcome to the programme, Michael.

Michael Hudson: It’s good to be back.

PS: Let’s say all these European programmes like the REPOWER Programme come into effect, how do you expect the EU standing to be on the stage after that?

MH: Well, the EU standing will be squeezed economically. It was trying to be a powerhouse in the world economy but in the last month the euro has been declining steadily against the dollar and it’s on the way to one dollar per euro. That’s because it’s having to pay much foreign exchange for energy, for food, for weapons. It’s shrinking in terms of other economies.

PS: Where do you think the EU’s standing will be in relation to powerhouses such as China?

MH: Well, it’s obviously out of the game. Instead of putting its own interests first, it’s really putting the US interests first. It’s acting more like a satellite of the United States than trying to its own destiny. The whole plan of the EU 20 years ago was to get rich by investing in Russia, investing in China and a mutual exchange. And now it’s decided to stop that. The US has absorbed Europe. The war in Ukraine is a war by the US primarily to pull Europe into the US orbit, prevent European transactions with Russia or China. So Western Europe is being left out, while Russia, China and Eurasia are going with the rest of Asia. Europe is simply going to be left behind. It’s losing its export markets, it’s being squeezed and -as you just mentioned- it’s pushed up the retirement age because it’s spending its budget on replenishing American military arms instead of investing in industry as it had been doing since 1945.

PS: You did indeed write that Europe has ceased to be an independent state. You’ve almost mentioned that the United States wanted to sever EU trade ties with Russia and China. How exactly did you get to that conclusion and do you think that this alleged US plan is succeeding?

MH: Well, I simply read the speeches of President Biden and his team. They’ve said that China is America’s number one enemy. If you’re going to call a country your number one existential enemy, you’re not going to be increasing your trade and mutual dependency with it. And it’s already insisted that its allies sanction -meaning boycott- Russian sports not only of oil and agriculture but of titanium, helium and all of the other exports that Russia has been making.Europe jas been following US directions not to have contact with Russia and without contact with Russia it’s not going to have contact with China because China sees that Europe is going to do exactly what it’s been doing to Russia.

PS: Obviously as a result of this current situation, for many years now, Russia and China have been growing closer diplomatically and economically. How do you see a global shift in power evolving over the next 5, 10 years or so?

MH: The current war is dividing the world into two parts. There’s going to be a US dollar area of the US, Europe and its satellites. And there’ll be a multipolarity; there’ll be a group of Russia, China together and basically they will be making their proposal of a different way of organising the world economic affairs to Africa, Latin America and other Asian countries. And other Asian countries, Latin America and the global south will see that it can get a better deal with Russia and China than it can get with the United States.

PS: On the flip side of that coin, one could argue that the existing situation, world order, has only been cemented by this war. You see NATO more aligned than ever, you see Europe more aligned than ever. You see Finland and Sweden on the brink, perhaps, of joining NATO. What would your response to this be, Michael?

MH: This integration of Europe into the United States sphere is like the new Berlin Wall. It’s isolated the US from the whole rest of the world. So instead of a victory for the United States it’s self-isolated itself because US strategists have realised that they’re losing the economic war with China, Russia and the whole group of emerging nations. All they can try to do is hold on to Europe as their one source of income to exploit from Europe what it can no longer get from any other country.

PS: As well as being a war on the ground, this is obviously an economic war. You yourself have noted that Nord Stream 2 (the gas pipeline from Russia to Germany) was one of the first victims of this crisis. To what extent are we now seeing an international conflict for energy resources? We obviously have the EU now weaning itself off Russian energy, the US trying to fill that gap to a certain extent with LNG. Then we have Russia now selling oil to India and China.

MH: The important thing about Russian oil being sold to India is that they’re sold in roubles, they’re no longer in dollars. The entire oil trade is now de-dollarised. It will be in roubles, in Chinese Yuan and in other currencies. But the dollar will be left out. The whole idea of dollar diplomacy, of the dollar’s free ride and monetary imperialism has ended.Everyone thought it would take 10 years for Russia, China and other countries to break away. Yet the United States itself has broken away from the other countries by grabbing the foreign exchange reserves of Afghanistan, Venezuela and now Russia. Nobody is going to trust to transact oil, trade and invest in dollars anymore because the United States can simply grab whatever money they want from countries that don’t agree to turn over their economic surplus to American investors and American traders. The United States has isolated itself. It’s shot itself in the foot.

PS: Talking of currencies, Russia is currently the most sanctioned country in the world but the rouble has recovered to way before pre-war levels. To what extent do you think the sanctions imposed on Russia by western countries have negatively impacted the countries imposing them?

MH: It’s certainly been very positive for Russia. The first sanctions were imposed on Russian agriculture like cheese from Lithuania. So now Russia produces its own cheese. When you sanction a country, you force that country to be more self-reliant on its own productions. President Putin has already said that now he’s going to be investing in import substitution. If he can’t buy imports from the United States now he’ll set up factories in Russia to produce themselves. There’s no reason Russia cannot do this and be its own industrial power. It doesn’t need the West. But the West still needs Russia. You mentioned Europe doing without Russian oil, and instead getting US liquefied natural gas. But it doesn’t have the ports to import that natural gas. It will have to spend $5 billion to build ports. It will take many years for this. What are Germany and Europe going to do for the next few years? Are they going to let their pipes freeze in their houses? So that their pipes break and flood the houses? Will the factories slow down? Already German fertiliser companies have closed down because they can’t get gas and it’s going to be years before they can get gas. Without fertiliser how are the Germans going to make their agricultural yields sustainable? Well, they won’t be. So Europe is going to increase its food deficit. It’s going to increase its energy deficit. It’s basically committing suicide on behalf of the Americans. I don’t know how long the political system of Europe can go along with leaders who represent America instead of their own national interests.

PS: As inflation and consumer prices keep rising in the US – Joe Biden maintains that it’s all Russia’s fault. Does it look like American taxpayers are buying that story, though?

MH: The press is very one-sided here. I think a lot of people are buying the story because Russia has not been very good on public relations here. The reality is, for instance, that in Ukrainian food exports, Ukraine cannot export its grain because Ukraine itself has mined the Black Sea. If you have mines that are going to block up ships in the Black Sea, that means insurance companies aren’t going to be willing to insure ships carrying the grain. All of this is blamed on Russia but Russia didn’t put the mines there – Ukraine did. But right now there is such a race hatred of Russians, that Americans are indeed buying it all and Russians are being blamed for everything. Such a thing happened when WW1 broke out. I live in Forest Hills in NYC and German families here had to change their name -away from a German name- and pretend to be Swedish or something else. Families like Donald Trump’s family had to pretend to be Swedish not German. There was such an anti-German family. Then you had the Japanese being interned in camps in WW2.So American society is a hate-filled society and the American empire is really an empire of hatred and antagonism. The way they look at the world is ‘Us vs. Them’ and Russia is the new ‘Them’.

PS: The seizing of Russian economic assets – hundreds of billions of dollars – in the West has certainly become a controversial precedent. Moscow has called it theft. What sort of impact has this situation had on the US economy and the dollar itself, as a global reserve currency?

MH: No impact at all on the US economy as such. If Russia loses the $300 billion that was stolen, it will be a great victory for Russia. That’s because what America has said is that no country’s savings in the United States are safe. Any country that denominated its trade in US dollars, any country that invests in the United States, if you don’t have your government follow American dictates, then we can simply grab your money -like we grabbed Russia’s money, Afghanistan’s money, Venezuela’s money. So the act against Russia has been essentially the US destroying foreign faith in the US economy and the safety of the US government. For the last 75 years, the US dollar and US Treasury Bills, loaned to the US government, bonds, have been the safest investment in the world. Now they’re the most risk investment. So what this means is that the American economy has decoupled itself from the Asian economy, from the Latin American and African economies. The Americans have decoupled and yet America is not self-sufficient. It relies on foreign countries, especially China and other Asian countries, for its industrial exports and it relies on Russia for much of its helium, titanium, iridium, palladium… all of these exports which it’s not going to be getting anymore. So America has basically committed trade suicide and economic suicide. Russia seems to have lost the $300 billion but on the other hand it now gets to compensate itself with all of the foreign investments that are in Russia, that it’s picking up, and its position in the world affairs as a trustworthy economy has gone way, way up relative to the United States.

PS: Russia, China and India are among the countries which are now calling for a new, multi-polar world order – without a strong reliance on the US and its allies. Does that seem like a realistic scenario to you?

MH: Well, the crisis is going to come this summer. Now that you have oil and food prices and shipping rates go way up, you’re going to have Latin America, Africa and much of Asia have tremendous balance-of-payment deficit. These balance-of-trade deficits for oil, food and shipping are going to go hand-in-hand with huge foreign debts denominated in dollars for foreign bond holders and foreign banks. Something is going to give. What will probably give is massive debt defaults against American bondholders and against American banks.At this point, Russia, China and their allies can say, “We can create parallel institutions in the world. We can create our International Monetary Fund to give you credit. We can create our own World Bank to promote actual, positive developments and not dependency on the United States exporters. So the US policy has driven other countries into the Eurasian orbit of China, Russia, Iran will be joining, India will be along, Indonesia. All these countries now will have something that they never had before; they have their own critical mass. They can deal with each other and be self-sufficient. They don’t need the dollar anymore. That’s what makes today different from the 1970s when the third world countries and the non-aligned nations tried to create a new international economic order but couldn’t. They didn’t have enough scope in their economies. Now they have enough scope that they don’t need America. You’re going to find the rest of the world rushing away from the dollar area, leaving only Europe as part of the United States economy at great sacrifice of its own living standards.

PS: Which countries do you think are gaining the most from the ongoing political and economic turmoil?

MH: I don’t know if you can say win. I’d say Russia and China will be the big winners. Russia already is because the American sanctions against Russia have forced Russia to do something that it could have done half a century ago. It’s forced Russia to create its own consumer goods industry, its own industrial take off. Russia can now build its own plants, equipment and factories and hire its own labour to produce what it was buying from Europe before. So it won’t need Europe anymore. Europe has lost the Russian market. Without the Russian market, I don’t see where Europe can grow because the United States won’t let European goods into it. The United States is protectionist. Europe will be squeezed and ultimately it will end up moving into the Russian and Chinese orbits but it will take years of suffering before that occurs.

PS: There’s a lot of talk on Western unity but it’s clear that there’s an economic price for this. Will the pain see countries follow Hungary and Serbia and say, enough is enough, we’re done with this.

MH: Western unity is a one way unity. Western unity is the United States telling other countries, “Do what we tell you to.” If other countries don’t do what America tells it to, they’re treated like the enemy. Like Hungary has been treated as an enemy. There’s talk of how to punish Hungary. The Americans have no idea how to offer something to attract other countries to it. All the United States can do is, “We can bomb you if you don’t do what we say. We have nothing positive to offer you. We have no trade options to offer you. We have no investment to offer you that will not siphon off your income. All we can do is bomb you and threaten you and sanction you and try to hurt you.” That’s the only way the United States and now Europe can relate to the rest of the world. That’s a poisoned relating. It’s a way guaranteed to drive the rest of the world away.

PS: Looking to a time after the war. What do you think the relationship between the US and Russia, or the EU and Russia look like?

MH: Permanently hostile for 20 years until Europe collapses and until the United States goes into a long depression. There is no rapprochement. There will be no settlement because the United States industrial economy can only make military arms. The only thing the United States can offer other countries is bombers and military arms and weaponry. Not anything to raise the living standards. The situation in the United States will be one of increasing hostility towards the rest of the world. The great threat is that it will say, “Well, we’re just going to blow up the world.”The people who are in charge of US policy think that way, they’ve been thinking that way for 20 years. I’ve worked with these people before and they really are willing to blow up the world if they can’t turn the other world into dependencies. That’s a real danger for the rest of the world and it’s forcing it to withdraw from the US orbit. I think it was Henry Kissinger who said that, “To be an enemy of America can be dangerous, but. “To be an enemy of America can be dangerous, but to be a friend is fatal.” Well, the US friend who’s really in danger is Europe. The enemies are going to do OK because they’re at least friends with each other.

—o0o—

Also take a look at more information that Michael Hudson supplied to us.  It is not on the main page and can only be found via the All News Button.

A Rare Look into Michael Hudson’s Email Inbox – US amazing threats against China and India

May 21, 2022

Source

Dear K C,

China won’t go along with this surrender, will it? This is amazing!

Michael

US Sanction ENFORCEMENT THREATS

Edward Wong and Michael Crowley, “U.S. Aims to Cripple Russian Oil Industry, Officials Say,” The New York Times, May 19, 2022.

BERLIN — The Biden administration is developing plans to further choke Russia’s oil revenues with the long-term goal of destroying the country’s central role in the global energy economy, current and former U.S. officials say, a major escalatory step that could put the United States in political conflict with China, India, Turkey and other nations that buy Russian oil.

The proposed measures include imposing a price cap on Russian oil, backed by so-called secondary sanctions, which would punish foreign buyers that do not comply with U.S. restrictions by blocking them from doing business with American companies and those of partner nations.
As President Vladimir V. Putin wages war in Ukraine, the United States and its allies have imposed sanctions on Russia that have battered its economy. But the nearly $20 billion per month that Russia continues to reap from oil sales could sustain the sort of grinding conflict underway in eastern Ukraine and finance any future aggressions, according to officials and experts.

U.S. officials say the main question now is how to starve Moscow of that money while ensuring that global oil supplies do not drop, which could lead to a rise in prices that benefits Mr. Putin and worsens inflation in the United States and elsewhere. As U.S. elections loom, President Biden has said a top priority is dealing with inflation.
While U.S. officials say they do not want to immediately take large amounts of Russian oil off the market, they are trying to push countries to wean themselves off those imports in the coming months. A U.S. ban on sales of critical technologies to Russia is partly aimed at crippling its oil companies over many years. U.S. officials say the market will eventually adjust as the Russian industry fades.

Russia’s oil industry is already under pressure. The United States banned Russian oil imports in March, and the European Union hopes to announce a similar measure soon. Its foreign ministers discussed a potential embargo in Brussels on Monday. The Group of 7 industrialized nations, which includes Britain, Japan and Canada, agreed this month to gradually phase out Russian oil imports and their finance ministers are meeting in Bonn, Germany, this week to discuss details.

“We very much support the efforts that Europe, the European Union, is making to wean itself off of Russian energy, whether that’s oil or ultimately gas,” Antony J. Blinken, the secretary of state, said in Berlin on Sunday when asked about future energy sanctions at a news conference of the North Atlantic Treaty Organization. “It’s not going to end overnight, but Europe is clearly on track to move decisively in that direction.”
“As this is happening, the United States has taken a number of steps to help,” he added.

But Russian oil exports increased in April, and soaring prices mean that Russia has earned 50 percent more in revenues this year compared to the same period in 2021, according to a new report from the International Energy Agency in Paris. India and Turkey, a NATO member, have increased their purchases. South Korea is buying less but remains a major customer, as does China, which criticizes U.S. sanctions. The result is a Russian war machine still powered by petrodollars.

American officials are looking at “what can be done in the more immediate term to reduce the revenues that the Kremlin is generating from selling oil, and make sure countries outside the sanctions coalition, like China and India, don’t undercut the sanctions by just buying more oil,” said Edward Fishman, who oversaw sanctions policy at the State Department after Russia annexed Crimea in 2014.

The Biden administration is looking at various types of secondary sanctions and has yet to settle on a definite course of action, according to the officials, who spoke on the condition of anonymity to discuss policies still under internal consideration. The United States imposed secondary sanctions to cut off Iran’s exports in an effort to curtail its nuclear program.

Large foreign companies generally comply with U.S. regulations to avoid sanctions if they engage in commerce with American companies or partner nations.
“If we’re talking about Rubicons to cross, I think the biggest one is the secondary sanctions piece,” said Richard Nephew, a scholar at Columbia University who was a senior official on sanctions in the Obama and Biden administrations. “That means we tell other countries: If you do business with Russia, you can’t do business with the U.S.”

But sanctions have a mixed record. Severe economic isolation has done little to change the behavior of governments from Iran to North Korea to Cuba and Venezuela.

One measure American officials are discussing would require foreign companies to pay a below-market price for Russian oil — or suffer U.S. sanctions. Washington would assign a price for Russian oil that is well under the global market value, which is currently more than $100 per barrel. Russia’s last budget set a break-even price for its oil above $40. A price cap would reduce Russia’s profits without increasing global energy costs.

The U.S. government could also cut off most Russian access to payments for oil. Washington would do this by issuing a regulation that requires foreign banks dealing in payments to put the money in an escrow account if they want to avoid sanctions. Russia would be able to access the money only to purchase essential goods like food and medicine.
And as those mechanisms are put in place, U.S. officials would press nations to gradually decrease their purchases of Russian oil, as they did with Iranian oil.

“There wouldn’t be a ban on Russian oil and gas per se,” said Maria Snegovaya, a visiting scholar at George Washington University who has studied sanctions on Russia. “Partly this is because that would send the price skyrocketing. Russia can benefit from a skyrocketing price.”

But enforcing escrow payments or price caps globally could be difficult. Under the new measures, the United States would have to confront nations that are not part of the existing sanctions coalition and, like India and China, want to maintain good relations with Russia.

In 2020, the Trump administration imposed sanctions on companies in China, Vietnam and the United Arab Emirates for their roles in the purchase or transport of Iranian oil.

Experts say the measures could be announced in response to a new Russian provocation, such as a chemical weapons attack, or to give Kyiv more leverage if Ukraine starts serious negotiations with Moscow.

U.S. officials want to ensure that European and Asian partners remain united with Washington on any new sanctions. But some European officials say certain measures, such as a price cap or tariffs on Russian oil, would be ineffective or too complicated to enact.

“We continue to look at those things,” Janet Yellen, the U.S. treasury secretary, said in Bonn on Wednesday. “You know, this is important for Europe to decide what they think is best.”
American officials say they have crunched numbers to see to what extent Russia would be starved of revenues if major buyers paid only a fraction of the market price for oil.

If the European Union decides to impose a price cap on their purchases rather than an outright embargo, Asian and Middle Eastern buyers of Russian oil might insist on paying the same low price, a U.S. official said.
“The advantage of a straight price cap is you go to the Chinese or the Indians and you say, we’re going to force you to save money!” said Daniel Fried, a retired diplomat who has served as the State Department’s coordinator for sanctions policy.

The toughest sanction imposed by the United States and European Union on Russia so far has blocked the Russian central bank’s access to foreign currency reserves in global accounts. That led to a plummet in the value of the ruble. But the bank has amassed foreign currency from Russian companies that are paid in dollars and euros for commodities, including energy.

U.S. and European officials have focused discussions on oil sanctions, leaving out the thornier question of Russian natural gas exports. European nations rely on Russian gas to heat homes and power businesses, and it cannot be easily replaced.
There are signs that large Chinese state-owned oil companies are holding back on signing new oil contracts with Russia, given the uncertainty over sanctions. American officials say that while China has given diplomatic and rhetorical support to Mr. Putin, Chinese companies and the government have not sent economic or military aid to Russia.
Chinese companies might be waiting until Russian commodity prices fall further before signing new contracts. And they also want to avoid secondary sanctions, said Alexander Gabuev, a senior fellow at the Carnegie Endowment for International Peace. Chinese companies are not well versed in sanctions compliance, he added, so the executives tend to err on the side of caution.

The Biden administration is also discussing another way to inflict pain on Russia: legally seizing the Russian central bank assets that were frozen in accounts overseas during the war, as well as those of Russian tycoons, and giving them to Ukraine for reconstruction, U.S. officials say.

As with the proposed energy sanctions, the United States is exploring the idea with European nations and members of the Group of 7.

Edward Wong reported from Berlin, Paris and Washington, and Michael Crowley from Washington. Matina Stevis-Gridneff contributed reporting from Brussels.

Andrei Martyanov: Feeling Sitrepish on May 20

May 20, 2022

Andrei Martyanov talks about a very important issue almost buried in the other issues.  That is the Global Conflict which he describes as the west against the global community coalescing around Russia and China now. 

On the Saker Blog, Andrei Raevski called it Zone A and Zone B, we can simply call it the west against the rest.

Please visit Andrei’s website: https://smoothiex12.blogspot.com/
and support him here: https://www.patreon.com/bePatron?u=60459185

Biden signs $40Bln bill for Ukraine: White House

May 21, 2022 

Source: Agencies

By Al Mayadeen English 

The White House signed the bill to send $40 billion in aid to Ukraine, despite calls against it.

US President Joe Biden Signs $40Bln Aid Bill For Ukraine: White House

The White House said on Saturday that US President Joe Biden approved legislation providing $40 billion in aid to Ukraine.

On Thursday, the US Senate cleared a record $40 billion Ukraine aid bill by an 86-to-11 vote. The proposal was approved by the House of Representatives earlier this month, 368-57.

The law will deliver almost $20 billion in military aid to Ukraine, nearly $9 billion in economic support, more than $4 billion in humanitarian relief, and another $4 billion in foreign military finance through the State Department. 

His words came hours before the Congress’ upper chamber is expected to vote in favor of the package in an unusual majority in Washington.

The bill provides “supplemental emergency appropriations for the fiscal year 2022 to Federal agencies to respond to the situation in, and for assistance to, Ukraine,” according to the White House.

However, Republican senator Rand Paul, on Wednesday, said that Congress needs to borrow money from China to send aid to Ukraine, just a day before the US Senate voted by majority to send $40 billion in military and economic aid to Ukraine and its allies. According to Investopedia, the US owes China $1 trillion in debt. 

“To borrow the money from China simply to send it to Ukraine makes no sense and makes us weaker, not stronger,” Paul said on the Senate floor regarding the aid package.

Paul, a week ago, disrupted the proceeding of a quick vote on a bill by blocking the US decision to allocate $40 billion to Ukraine. Ten other senate Republicans, including Marsha Blackburn, John Boozman, Mike Braun, Mike Crapo, Bill Hagerty, Josh Hawley, Mike Lee, Cynthia Lummis, Roger Marshall, and Tommy Tuberville, also voted against the advancement of the bill.

CNN claimed earlier this week, citing a government official, that the bill will be “flown” to Biden in South Korea for signature while the president is on his Asian tour.

The US Is Recalibrating Its Eurasian Containment Strategy Against Russia & China

19 MAY 2022

By Andrew Korybko

American political analyst

The US’ grand strategy pretty much amounts to preparing for what many fear might be the inevitable conventional phase of what some are already calling the ongoing Third World War that’s thus far only being waged through hybrid (economic, financial, information, proxy, etc.) means.

Russia’s ongoing special military operation in Ukraine prompted the US to decisively shift for the time being to focusing more on “containing” it than China, which has thus far succeeded in uniting the West under its previously fading hegemony. Nevertheless, this temporary pivot raised questions about the US’ hegemonic commitment to “containing” China in the Asia-Pacific, made all the more uncertain by India’s proud flexing of its strategic autonomy by continuing to practice a policy of principled neutrality towards the Ukrainian Conflict in spite of unprecedented American pressure to condemn and sanction Moscow.

Biden’s trip to South Korea and Japan gives the US the opportunity to recalibrate its Eurasian “containment” strategy in light of these new international conditions. He’ll participate in a meeting with the Quad while in Tokyo on 24 May, during which time the American leader will have to make the best out of India’s refusal to join that network’s anti-Russian crusade while still trying to find a role for it play in “containing” China despite that South Asian state being left out of AUKUS. Furthermore, India’s trust in the US has greatly deteriorated due to America’s hegemonic pressure campaign against it.

The only way that the US can simultaneously “contain” Russia and China is to rely on a supercontinental-wide version of its “Lead From Behind” model that was first experimented with during NATO’s War on Libya in 2011. This concept refers to the US getting regional partners with shared interests to do the proverbial “heavy lifting” while it provides all the necessary back-end assistance such as intelligence and logistics, not to mention occasionally “leading from the front” by publicly setting the agenda and directly confronting the targeted state.

In the Western Eurasian theater of the New Cold War, the US’ plans to incorporate Finland and Sweden into NATO are aimed at complicating Russia’s regional security environment, dividing its focus, and thus creating opportunities for the EU to more effectively leverage its existing military capabilities to continue threatening Russia’s national security interests. The US’ 100,000 troops will remain in the continent to serve as credible tripwires against any Russian kinetic action towards its NATO vassals while mostly focusing on enhancing their capabilities to “contain” that country.

For instance, Poland could become a regional center of NATO gravity in the “Three Seas Initiative” (3SI) across Central & Eastern Europe (CEE) that Warsaw envisions falling within its “sphere of influence”. The Scandinavian countries (Denmark/Finland/Iceland/Norway/Sweden), meanwhile, would form their own so-called “Viking Bloc”. Similarly, Bulgaria and Romania could function as the US’ Balkan outposts in the Black Sea. France and Germany might move towards a so-called “EU Army” that could involve them all while the UK could assist the US in managing all of this per its junior partnership in that hegemonic axis.  

On the Eastern Eurasian front, India can’t be relied upon to “contain” China “to the last Indian” like the US manipulated Ukraine into “containing” Russia “to the last Ukrainian”. This throws a major spanner in America’s grand strategic plans, but it’s not an irreparable problem in principle. India can still function as a siphon of foreign investment from China, especially if the People’s Republic continues practicing its zero-COVID policy that’s hurt supply chains, but it still has a long way to go before reaching that point. Nevertheless, India’s economic role in this “containment” model is more promising than its military one.

AUKUS is indisputably the “tip of the sphere” when it comes to the US’ military “containment” plans against China, and this emerging network will likely recruit more regional partners such as the Philippines and South Korea. Moreover, NATO is expanding to the Asia-Pacific under the false pretext of the EU’s response to the China-Solomon Islands deal, so that’ll help “share the burden” of US hegemony there. It might even be the case that this bloc’s Balkan, CEE, and Scandinavian members take the lead in “containing” Russia while its Western European ones shift to “containing” China in the Asia-Pacific.

For this grand strategic scenario to materialize, the US must first “lead from the front” by formulating these complex plans and providing incentives for every member to play their envisioned roles. This will include setting the agenda through public statements, providing economic incentives (e.g. preferential trade deals and/or threatening to impose “secondary sanctions” against all who don’t curtail their ties with Russia and China), selling state-of-the-arm military equipment, carrying out joint military exercises, and devising a joint infowar strategy for all its partners to participate in against those two.

The task ahead is unprecedented in scale and scope but represents the only way that America has any credible chance of stopping the decline of its unipolar hegemony, not to mention potentially reversing it in some respects like it just succeeded in doing in the EU. It pretty much amounts to preparing for what many fear might be the inevitable conventional phase of what some are already calling the ongoing Third World War that’s thus far only being waged through hybrid (economic, financial, information, proxy, etc.) means. The US doesn’t seem deterred by this though and is proceeding at full speed ahead.

China to receive two million barrels of Iranian oil, despite US sanctions

Iran has been cooperating with China, Russia, Venezuela, and Cuba in order to bypass the effects of US economic sanctions

May 19 2022

(Photo credit: Press TV)

ByNews Desk

China is scheduled to receive around two million barrels of Iranian crude oil this week that it will pump into an oil terminal in the Zhanjiang city of Guangdong province, southwest of the country.

The oil will be discharged by the Diona crude oil carrier owned by the National Iranian Tanker Company (NITC), according to Vortexa Analytics, an agency that specializes in tanker tracking.

“This would be the third Iranian oil cargo destined for government stockpile following two similar-sized shipments in December and January,” the agency reported.

Despite ongoing economic sanctions imposed on Iran by the US, China has been purchasing large amounts of Iranian oil over the past two years.

Iran plays a crucial role in the Belt and Road Initiative, a mega-infrastructure and economic initiative launched by Beijing to link the economies of Europe, Asia, and Africa, with an eye on expanding to Latin America.

Over recent years, Iran has played an instrumental role in cooperating with other countries to overcome the effects of punitive US sanctions.

On 3 May, Iranian Oil Minister Javad Owji met with Venezuelan President Nicolas Maduro in Caracas to discuss energy relations and ways to overcome the repercussions of US sanctions unilaterally imposed on the two countries.

Venezuela and Iran have recently stepped up energy cooperation to overcome sanctions, with Venezuela importing condensate and thinners from Iran.

Back in January, an Iranian supertanker started discharging about two million barrels of Iranian condensate at the main port of Venezuela’s state-run oil company, as part of a bilateral deal that defies the US sanctions imposed on both nations.

On 17 May, UN Special Rapporteur Alena Douhan said the US must lift economic sanctions on Iran due to the harmful impact they have on the Iranian people.

“I call on the United States to abandon unilateral sanctions,” the UN special rapporteur told a press conference in Tehran.

Douhan went further, saying that the application of “extra-territorial sanctions on Iranian companies or companies working with Iran or paying Iran in dollars is illegal under international law.”

The UN official said she would address her concerns over the legality of US sanctions in her final report, to be published at a later date.

The Middle Corridor Will Help China Hedge Against Uncertainty In Russia & Pakistan

17 MAY 2022

The Middle Corridor Will Help China Hedge Against Uncertainty In Russia & Pakistan

It’s unrealistic that China would ever abandon its investments in Russia or Pakistan, but those two’s connectivity roles for it vis-à-vis the EU and West Asia/Africa respectively can be complemented by Turkey and Iran via the Middle Corridor.

American political analyst

By Andrew Korybko

Up until the beginning of this year, China’s grand strategy was to rely on a network of connectivity corridors across its Belt & Road Initiative (BRI) to integrate Eurasia and thus advance its non-Western model of globalization, which Beijing believes to be more equal, just, and multipolar than the declining Western-centric one. This ambitious plan was abruptly disrupted by two black swan events that created sudden uncertainty about the viability of BRI’s Russian and Pakistani routes: Moscow’s ongoing special military operation in Ukraine and Islamabad’s scandalous change of government.

The first-mentioned prompted the US-led West to impose unprecedented sanctions that resulted in the forced decoupling of Russia and the EU while the second led to the global pivot state’s worst-ever political crisis since independence that’s also been exploited by BLA terrorists. Regarding Russia, it’s no longer a realistic transit route for overland trade between Eastern and Western Eurasia. As for Pakistan, there are suspicions that its new authorities’ speculative proUS pivot will occur at China’s expense. The BLA’s recent terrorist attack also led to all Confucius Institution teachers returning home for their safety.

China still considers Russia and Pakistan to be among its top strategic partners anywhere in the world, especially since both veritably play indispensable roles in Eurasia’s irreversible multipolar integration due to BRI’s Eurasian Land Bridge and China-Pakistan Economic Corridor (CPEC) respectively. Nevertheless, their reliability in the present is less than it was at the start of the year, which is why China might understandably begin hedging against their uncertainties that could last for an indeterminate length of time by focusing more on the Middle Corridor.

This project refers to the connectivity route between Turkey and China via the South Caucasus, Caspian Sea, and Central Asia. In the current conditions, it represents the most viable trans-Eurasian corridor. There are undoubtedly some risks associated with it as evidenced by the sudden attempted terrorist takeover of Kazakhstan in January, which had previously been considered to be Central Asia’s most stable state. That said, compared to the connectivity risks connected to Russia and Pakistan nowadays, the Middle Corridor is much more reliable and safer in all respects.

The implications of the People’s Republic pressing through with this pragmatic back-up plan could be enormous since it would throw a spanner in Russia and Pakistan’s geo-economic strategies, even though it’s not Beijing’s fault that they’re no longer viable connectivity partners, but their own due to the decisions they made. That’s not to cast judgement on them, but just to point out that China would simply be responding to events beyond its control or influence in order to advance its interests that it considers to be to the greater benefit of mankind due to its envisioned community of common destiny.

Russia and Pakistan are obviously part of mankind just like everyone else is but China cannot keep a disproportionate amount of its BRI eggs in their basket, so to speak, which is why it’ll likely be compelled by circumstances to focus more on the Middle Corridor in the coming years. Despite occasional troubles in its ties with Turkey stemming from the sympathy that some in that West Asian country have for Uyghur separatists that China considers to be terrorists, relations are generally solid and actually stand to become much more strategic the longer that uncertainty prevails in Russia and Pakistan.

To explain, Europe hasn’t yet been pressured by its American overlord to curtail ties with China exactly like it recently curtailed those with Russia. For the time being, they’re still in a relationship of complex economic interdependence with the People’s Republic, yet the Eurasian Land Bridge through Russia is no longer a viable means for conducting their future overland trade. For that reason, the Middle Corridor anchored in Turkey is much more attractive since goods can transit through this route between the EU and China instead of remaining dependent on the Suez Canal.

President Erdogan could leverage his civilization-state’s unexpectedly disproportionate geo-economic role in Eurasian integration to reduce the US-led West’s pressure upon Turkey exactly as he could do the same in the event that he succeeds in clinching an EU-Israeli pipeline deal in the coming future. His isn’t the only Muslim Great Power that would benefit from the Middle Corridor though since neighboring Iran can prospectively do as well. It can connect to that BRI route via Turkmenistan or perhaps by pioneering its own “Persian Corridor” to China through Afghanistan and Tajikistan.

Whichever way it happens, there’s no doubt that there’s mutual interest between Iran and China to strengthen their connectivity with one another after last year’s 25-year strategic partnership pact. They could have possibly done so by expanding CPEC in the western direction (W-CPEC+) but the newfound political and security uncertainty in Pakistan has made that unviable for the foreseeable future, hence why China might simply go ahead with expanding the Middle Corridor to Iran and/or cooperating on the Persian Corridor proposal.

China’s ties with the Gulf Kingdoms are also very strong, especially since the People’s Republic plans to invest in their systemic reform programs for diversifying their economies from their hitherto disproportionate dependence on resource exports. While their relations with Iran remain complex, there’s been visible progress over the past year or so in taking baby steps towards a rapprochement, particularly in terms of Tehran’s ties with Abu Dhabi and Riyadh. In the event that this continues, Iran could serve as the transit state for facilitating real-sector Chinese-Gulf trade.

Iran also abuts the Indian Ocean just like neighboring Pakistan does, but unlike the latter, Iran isn’t mired in political and security uncertainty so it could complement – though importantly never replace – the envisioned role that Pakistan was supposed to play with respect to facilitating Chinese-African trade. Nobody should misunderstand what’s being written in this analysis: it’s unrealistic that China would ever abandon its investments in Russia or Pakistan, but those two’s connectivity roles for it vis-à-vis the EU and West Asia/Africa respectively can be complemented by Turkey and Iran via the Middle Corridor.

What all of this means is that the uncertainty in Russia and Pakistan, while detrimental for their own interests as well as their role in Eurasia’s multipolar integration, provides unexpected opportunities for China to diversify BRI by focusing more on the Central Asian-Caspian Sea-South Caucasus-Gulf direction through the comparatively much more reliable and safer Middle Corridor. Turkey and Iran are the two Great Powers that stand to benefit the most from this, not to mention the medium- and smaller-sized countries between them and China. All told, the comprehensive gains might outweigh the setbacks.

BIDEN’S BOYCOTT OF CUBA IS “A FAILURE AT REGIONAL DIPLOMACY”

MAY 17TH, 2022

MEDEA BENJAMIN

On May 16, the Biden administration announced new measures to “increase support for the Cuban people.” They included easing travel restrictions and helping Cuban-Americans support and connect with their families. They mark a step forward but a baby step, given that most U.S. sanctions on Cuba remain in place. Also in place is a ridiculous Biden administration policy of trying to isolate Cuba, as well as Nicaragua and Venezuela, from the rest of the hemisphere by excluding them from the upcoming Summit of the Americas that will take place in June in Los Angeles.

This is the first time since its inaugural gathering in 1994 that the event, which is held every three years, will take place on U.S. soil. But rather than bringing the Western Hemisphere together, the Biden administration seems intent on pulling it apart by threatening to exclude three nations that are certainly part of the Americas.

For months, the Biden administration has been hinting that these governments would be excluded. So far, they have not been invited to any of the preparatory meetings and the Summit itself is now less than a month away. While former White House press secretary Jen Psaki and State Department spokesman Ned Price have repeated that “no decisions” have been made, Assistant Secretary of State Brian Nichols said in an interview on Colombian TV that countries that “do not respect democracy are not going to receive invitations.”

Biden’s plan to pick and choose which countries can attend the Summit has set off regional fireworks. Unlike in the past, when the U.S. had an easier time imposing its will on Latin America, nowadays there is a fierce sense of independence, especially with a resurgence of progressive governments. Another factor is China. While the U.S. still has a major economic presence, China has surpassed the U.S. as the number one trading partner, giving Latin American countries more freedom to defy the United States or at least stake out a middle ground between the two superpowers.

The hemispheric reaction to the exclusion of three regional states is a reflection of that independence, even among small Caribbean nations. In fact, the first words of defiance came from members of the 15-nation Caribbean Community, or Caricom, which threatened to boycott the Summit. Then came regional heavyweight, Mexican President Manuel López Obrador, who stunned and delighted people around the continent when he announced that, if all countries were not invited, he would not attend. The presidents of Bolivia and Honduras soon followed with similar statements.

The Biden administration has put itself in a bind. Either it backs down and issues the invitations, tossing red meat to right-wing U.S. politicians like Senator Marco Rubio for being “soft on communism,” or it stands firm and risks sinking the Summit and U.S. influence in the region.

Biden’s failure at regional diplomacy is all the more inexplicable given the lesson he should have learned as vice president when Barack Obama faced a similar dilemma.

That was 2015, when, after two decades of excluding Cuba from these Summits, the countries of the region put down their collective feet and demanded that Cuba be invited. Obama had to decide whether to skip the meeting and lose influence in Latin America, or go and contend with the domestic fallout. He decided to go.

Oabam a visit to CUba

Cristobal Marquez, owner of “Cristobal’s,” the restaurant where Michelle and Barak Obama had lunch during their visit to Cuba in 2016, shows the book made by White House photographer Pete Souza, in Havana, Cuba. Ramon Espinosa | AP

I remember that Summit vividly because I was among the bevy of journalists jostling to get a front seat when President Barack Obama would be forced to greet Cuba’s President Raúl Castro, who came into power after his brother Fidel Castro stepped down. The momentous handshake, the first contact between leaders of the two countries in decades, was the high point of the summit.

Obama was not only obligated to shake Castro’s hand, he also had to listen to a long history lesson. Raúl Castro’s speech was a no-holds-barred recounting of past U.S. attacks on Cuba—including the 1901 Platt Amendment that made Cuba a virtual U.S. protectorate, U.S. support for Cuban dictator Fulgencio Batista in the 1950s, the disastrous 1961 Bay of Pigs invasion and the scandalous U.S. prison in Guantanamo. But Castro was also gracious to President Obama, saying he was not to blame for this legacy and calling him an “honest man” of humble origins.

The meeting marked a new era between the U.S. and Cuba, as the two nations began to normalize relations. It was a win-win, with more trade, more cultural exchanges, more resources for the Cuban people, and fewer Cubans migrating to the United States. The handshake led to an actual visit by Obama to Havana, a trip so memorable that it still brings big smiles to the faces of Cubans on the island.

Then came Donald Trump, who skipped the next Summit of the Americas and imposed draconian new sanctions that left the Cuban economy in tatters, especially once COVID hit and dried up the tourist industry.

Until recently, Biden has been following Trump’s slash-and-burn policies that have led to tremendous shortages and a new migration crisis, instead of reverting to Obama’s win-win policy of engagement. The May 16 measures to expand flights to Cuba and resume family reunifications are helpful, but not enough to mark a real change in policy—especially if Biden insists on making the Summit a “limited-invite only.”

Biden needs to move quickly. He should invite all the nations of the Americas to the Summit. He should shake the hands of every head of state and, more importantly, engage in serious discussions on burning hemispheric issues such as the brutal economic recession caused by the pandemic, climate change that is affecting food supplies, and the terrifying gun violence–all of which are fueling the migration crisis. Otherwise, Biden’s #RoadtotheSummit, which is the Summit’s Twitter handle, will only lead to a dead end.

Feature photo | President Joe Biden and first lady Jill Biden wave to reporters before boarding Air Force One at Andrews Air Force Base, Md., May 17, 2022. Gemunu Amarasinghe | AP

Medea Benjamin is the co-founder of the peace group CODEPINK. She is the author of ten books, including three books on Cuba—No Free Lunch: Food and Revolution in Cuba, The Greening of the Revolution, and Talking About Revolution. She is a member of the Steering Committee of ACERE (Alliance for Cuba Engagement and Respect).

The views expressed in this article are the author’s own and do not necessarily reflect MintPress News editorial policy.

Gonzalo Lira: The Pentagon Says: Russia No—But China Yes

May 17, 2022

After the NATO War is Over

May 17, 2022

Source

By Batiushka

Make no mistake about it: The tragic war that is currently taking place on Ukrainian battlefields is not between the Russian Federation and the Ukraine, but between the Russian Federation and the US-controlled NATO. The latter, also called ‘the collective West’, promotes an aggressive ideology of organised violence, a politically- economically- and militarily-enforced doctrine euphemistically known as ‘Globalism’. This means hegemony by the Western world, which arrogantly calls itself ‘the international community’, over the whole planet. NATO is losing that war, which uses NATO-trained Ukrainians as its proxy cannon fodder, in three spheres, political, economic and military.

Firstly, politically, the West has finally understood that it cannot execute regime change in Moscow. Its pipedream of replacing the highly popular President Putin with is CIA stooge Navalny is not going to happen. As for the West’s puppet-president in Kiev, he is only a creature of Washington and its oligarchs. A professional actor, he is unable to speak for himself, but is a spokesman for the NATO which he loves.

Secondly, economically, the West faces serious resistance to the 6,000 sanctions it has imposed on Russia and Russians. Those sanctions have backfired. In the West, we can testify to this every time we buy fuel or food. The combination of high inflation (10% +) and even higher energy prices, caused almost solely by these illegal anti-Russian sanctions, are threatening the collapse of Western economies, much more than threatening Russia or China. As a result of this reverse effect of sanctions against Russia, the rouble is at a three-year high, standing at about 64 to the US dollar and rising, though immediately after the sanctions it had briefly gone down to 150 to the dollar.

After strenuously denying that they would do it, already most countries in Europe (at least 17 for now), including Germany and Italy, have agreed to open accounts with Gazprombank, as Russia advised them to do and to pay for oil and gas in roubles. And this number is growing by the week. The problems will be even greater with food shortages, as the world food chain is highly integrated and the agricultural production of Russia and the Ukraine (now controlled by Russia) is at least 40% of the world’s grain production.  Just days ago it was announced that Russia expects record grain production this year (130 million tonnes). Russia may yet demand payment in roubles for all this as well.

The sanctions against Russia have divided Europe and are threatening to divide NATO. President Erdogan of Turkey, a NATO member, has announced that he would veto the entry to NATO of Finland and Sweden into NATO. At the same time, Russia has announced that it will cut off Finland’s natural gas supply. Swedish leaders are re-thinking their entry to NATO.

Thirdly, militarily, it is clear that the Ukraine, with huge numbers of desertions and surrenders, has no chance of winning the war against Russia. Most of its military equipment has already been wiped out and newly-delivered and often antiquated Western equipment will make little difference, even if it is not destroyed by Russian missiles as soon as it reaches the Ukraine. The conflict could now be over within weeks, rather than months. The US ‘Defense Secretary’ (= Minister for Offense), Lloyd Austin, has desperately called the Russian Defence Minister Sergey Shoigu to beg for a ceasefire. Would you agree to a ceasefire when in less than three months and with only 10% of your military forces you have already occupied an area greater than England inside the Ukraine, an area that produces 75% of Ukrainian GDP?

The panic of financial disaster in the West has begun to set in. As a result, the French President Macron has told President Zelensky (that is, told Washington) to give up part of Ukraine’s sovereignty and at last start serious negotiations with Russia. Macron is also trying to free French mercenaries from Azovstal in Mariupol, but the problem is much bigger than this, as the whole of Europe is facing economic meltdown. And the Italian Prime Minister, Mario Draghi, has asked President Biden to contact President Putin and ‘give peace a chance’. Note that Mario Draghi is a former president of the European Central Bank and a Goldman Sachs puppet – just as Macron is a Rothschild puppet.

There have always been empires and invasions throughout history. However, they have always been local and not been justified as the only possible global ideology, a ‘New World Order’, to be imposed by violence all over the planet. After the NATO war is over, lost by ‘the collective West’, NATO Centralism, the ideology of a ‘Unipolar World’, controlled from Washington, must end. However, Centralism must also come to an end everywhere else, like that under Soviet-period Moscow (1).

However, Nationalism must also come to an end. Here we should remember that the very word ‘Nazism’ comes from the German words for ‘National Socialism’. (Nationalism entails hatred for others, whereas Patriotism means the ability not only to love your own country, but also love the countries of others, not hate their countries). And the Ukraine has a history of Nazism, stretching back over eighty years. Moreover, today’s leading Kiev soldiery are Nazi nationalists and represent the tribalism so typical of Western Europe, responsible in the twentieth century for two huge wars which it spread worldwide. The Nazi Ukrainian cries of ‘Glory to the Ukraine’ and their slogan of ‘Ukraine above Everything’ are slogans of Nazism.

Let us move to a world that is multipolar and multicentric, which has unity in diversity and diversity in unity. If we do not move towards this, we will probably be lost. For a multipolar, multicivilisational and multicultural world, the world of seven billion human beings already, is the only civilized world, the only true international community.

Note:

1. Here anti-Semites will tell you that the Centralism of Soviet-period Moscow was founded by the Bolsheviks, of whom over 80% were Jews. Firstly, it should be pointed out that they were atheist Jews, internationalists like Bronstein/Trotsky, who supported the ‘Third International’. In other words, they were political Zionists (not religious Zionists, indeed, they were anti-religious). And let us recall that a huge number of Jews were and are anti-Zionists and a huge number of Zionists were and are not at all Jews. This is why the Saker rightly uses the term ‘Anglo-Zionism’ for these unipolar centralisers.

FM Sergey Lavrov’s remarks at the 30th Assembly of the Council on Foreign and Defence Policy

May 16, 2022

Moscow, May 14, 2022

Mr Lukyanov,

Mr Karaganov,

Colleagues,

I am glad to be here again, at this anniversary assembly. Last time, we met in this room on October 2, 2021. But I have an impression that this was in a totally different historical epoch.

I would like to congratulate you on the 30th anniversary of the Council on Foreign and Defence Policy. Its activities are a fine example of Russian expert involvement in the foreign policy process. From the very start, the Council has brought together professionals, including politicians, state officials, journalists, academics, and entrepreneurs.  Throughout these years, this has ensured an effective and rewarding combination of practical experience and impeccable knowledge of the subject matter. Therein lies the key to comprehending the most complex international processes, particularly at stages like the present one. Advice, analytical materials, and debates (occasionally heated debates involving a clash of opinions) are of much help to us. We invariably take them into consideration in our foreign policy activities.

It is a cliche to say that this meeting is taking place at a historical turning point. I agree with the experts (Mr Karaganov and Mr Lukyanov have written a lot about this), who say that we again have to choose a historical path, like we did in 1917 and 1991.

The external circumstances have not just changed radically; they are changing ever more profoundly and extensively (though not becoming more elevated, unfortunately) with each passing day. And our country is changing along with them. It is drawing its conclusions. The choice we have taken is made easier by the fact that the “collective West” has declared a total hybrid war against us. It is hard to forecast how long this will last. But it is clear that its consequences will be felt by everyone without exception.

We did everything in our power to avoid a direct conflict. But they issued a challenge and we have accepted it. We are used to sanctions. We have been living under one or another form of sanctions for a long time now. The surprising thing is a surge of rabid Russophobia in almost all “civilised” countries. They have thrown to the wind their political correctness, propriety, rules, and legal norms. They are using the cancel culture against all things Russian. All hostile actions against our country are allowed, including robbery. Russian cultural figures, artists, athletes, academics, businesspeople and just ordinary citizens are exposed to harassment.

This campaign has not bypassed Russian diplomats. They often have to work under extreme conditions, occasionally with a risk to their health or life. We do not remember anything like the current massive and synchronised expulsion of diplomats happening even in the grimmest Cold War years. This is destroying the general atmosphere of relations with the West. On the other hand, this is freeing up energy and human resources for work in the areas with which our country’s future development should be associated.

In accordance with the demands of the times, we are carrying out our professional duties conscientiously and to the fullest extent. There are no traitors among our diplomats, although such attempts have been made from abroad and within the country. We do our best to defend the rights and interests of Russian citizens abroad. When the West hysterically reacted to the beginning of our special military operation and all flights were cancelled, we immediately helped Russians who were abroad at the time to return home. The routine consular services to Russians (of which there have always been many) are provided as always. It is clear that the situation demands that the diplomatic service works in a special regime. This is required by the new tasks set by the country’s leadership to protect national interests.

This is not only and not so much about Ukraine, which is being used as an instrument to contain the peaceful development of the Russian Federation in the context of their course to perpetuate a unipolar world order.

The Americans started preparing the current crisis long ago, right after the end of the Cold War, having decided that the way to global hegemony was then open. NATO’s eastward expansion has been one of the key components of such a course. We tried hard to convince them not to do this. We showed where and why our red lines are drawn. We were flexible, ready to make concessions and look for compromises. All this proved futile. President Vladimir Putin reminded us of this once again in his speech on May 9 on Red Square.

Today Western countries are ready to oppose Russia, as they now say, “to the last Ukrainian”. At first glance, this is a very convenient position, especially for the United States, which is managing these processes from across the ocean. At the same time, they are weakening Europe by clearing its markets for its goods, technologies and military-technical products.

In fact, the situation has many layers. Russia, the United States, China and all others realise that it is being decided today whether the world order will become fair, democratic and polycentric, or whether this small group of countries will be able to impose on the international community a neo-colonial division of the world into those who consider themselves “exceptional” and the rest – those who are destined to do the bidding of the chosen few.

This is the aim of the “rules-based order” concept that they have sought to introduce into general circulation for years. No one has seen, or discussed, or approved these “rules”, but they are being imposed on the international community. As an example, let me quote a recent statement by US Secretary of the Treasury Janet Yellen, who called for a new Bretton Woods framework and said that the United States would practice “the friend-shoring of supply chains to a large number of trusted countries” that shared “a set of [liberal] norms and values about how to operate in the global economy.” The hint is absolutely clear: the US dollars and the “benefits” of the international financial system are only for those who follow these American “rules.” Dissenters will be punished. Clearly, Russia is not the sole target, all the more so as we will fight back. The attack is aimed at all those capable of conducting an independent policy.  Take, for example, Washington’s pet Indo-Pacific strategy, which is directed against China. In parallel, it seeks to firmly and reliably harness India to the US and NATO. In the spirit of the Monroe doctrine, the United States wants to dictate standards to Latin America. The inevitable question is whether the Americans are really able to follow the key principle of the UN Charter, which states: “The Organisation is based on the principle of the sovereign equality of all its Members.”

The “rules-based order” envisions neither democracy, nor pluralism even within the “collective West.” The case in point is the revival of tough bloc discipline and an unconditional submission of the “allies” to Washington’s diktat. The Americans will not stand on ceremony with their “junior partners.” The EU will finally lose all attributes of independence and obediently join the Anglo-Saxon plans to assert the unipolar world order, while sacrificing the Europeans’ quality of life and key interests in order to please the United States. Just recall how Victoria Nuland defined the EU’s place in Washington’s plans to reformat Ukraine in her conversation with the US Ambassador in Kiev in December 2013, at the height of the Maidan riots. Her prediction came true in its entirety. In security matters, the EU is also blending in with NATO, which, in turn, is making increasingly louder claims about its global ambitions. What defensive alliance? We are being told and assured to this day that NATO’s expansion is a defensive process and threatens no one. The Cold War defence line ran along the Berlin Wall – concrete and imagined – between the two military blocs. Since then, it has been moved east five times. Today, NATO Secretary-General Jens Stoltenberg, UK Foreign Secretary Liz Truss, and others are telling us that NATO has a global responsibility to solve security problems, primarily in the Indo-Pacific region. As I understand it, the next defence line will be moved to the South China Sea.

It is being insinuated that NATO as the vanguard of the community of democracies should replace the UN in matters of international politics, or at least bring global affairs under its sway. The G7 should step in to run the global economy and from time to time invite benevolently the extras the West needs at this or that moment.

Western politicians should accept the fact that their efforts to isolate our country are doomed. Many experts have already recognised this, even if quietly and off the record, because saying this openly is “politically incorrect.” But this is happening right now. The non-Western world is coming to see that the world is becoming increasingly more diverse. There is no escaping this fact. More and more countries want to have a real freedom to choose their development ways and integration projects to join. An increasing number of countries in Asia, Africa and Latin America are refusing to abandon their national interests and to pull chestnuts out of the fire for the former parent countries. An overwhelming majority of our partners, who have felt the effects of Western colonialism and racism, have not joined the anti-Russia sanctions. The West, which President Putin described as the “empire of lies,” has not been considered an ideal of democracy, freedom and well-being for a long time. By plundering other countries’ material assets, the Western countries have destroyed their reputation of predictable partners who honour their commitments. Nobody is safe from expropriation and “state piracy” now. Therefore, not just Russia but also many other countries are reducing their reliance on the US dollar and on Western technologies and markets. I am sure that a gradual de-monopolisation of the global economy is not a distant future.

We have taken note of Fyodor Lukyanov’s article published in the newspaper Kommersant (on April 29, 2022), in which he writes, with good reason, that the West will not listen to us or hear what we have to say. This was a fact of life long ago, before the special military operation, and a “a radical reorientation of assets from the west to other flanks is a natural necessity.” I would like to remind you that Sergey Karaganov has been systematically promoting this philosophy by for many years. It is perfectly clear to everyone that the process has begun and not on our whim – we have always been open to an equal dialogue – but because of an unacceptable and arrogant behaviour of our Western neighbours, who have followed Washington’s prompting to “cancel Russia” in international affairs.

Forging closer ties with the like-minded forces outside of what used to be referred to as the Golden Billion is an absolutely inevitable and mutually driven process. The Russia-China relations are at their all-time high. We are also strengthening our privileged strategic partnerships with India, Algeria, and Egypt. We have taken our relations with the Persian Gulf countries to a whole new level. The same applies to our relations with the Association of Southeast Asian Nations, as well as other countries in Asia-Pacific, in the Middle East, Asia, Africa, and Latin America.

We are fully aware of the fact it is at this juncture, which perfectly lends itself to be called a turning point, that the place for Russia and all other countries and forces in the future international architecture will be determined.

We believe the aim of Russia’s diplomacy is, on the one hand, to act with great resolve to fend off all adversarial attacks against us, while, on the other hand, to consistently, calmly and patiently reinforce our positions in order to facilitate Russia’s sustained development from within and improve the quality of life for its people. There is much to be done, as usual. We always have a packed agenda, but in the current environment we are witnessing a serious shift in the mindsets of many of our comrades in all spheres of Russia’s life. This makes meetings held by the Council on Foreign and Defence Policy especially useful because they help nurture ideas which make their way into Russia’s foreign policy.

The World’s Future Hangs In The Balance: Erdogan Will Decide

15 MAY 2022

The World

On the one side, the U.S.-and-allied side, stands Davos, the Bilderbergers, the Trilateralists, and the rest of the “Washington Consensus,” the view of the U.S.-and-allied side, that America should control the world; and, on the other side stands the United Nations side, the view that neutral and internationally democratically based and neutrally applied international laws should instead control the world, without favoring America’s, or any other country’s, billionaires.

By Eric Zuesse

Investigative historian Eric Zuesse’s next book (soon to be published) will be AMERICA’S EMPIRE OF EVIL: Hitler’s Posthumous Victory, and Why the Social Sciences Need to Change. It’s about how America took over the world after World War II in order to enslave it to U.S.-and-allied billionaires. Their cartels extract the world’s wealth by control of not only their ‘news’ media but the social ‘sciences’ — duping the public.

Turkey’s President Tayyip Erdogan will decide the future of the world; and, on Friday the 13th day of May in 2022, he gave his first indication of what that decision will be — that it will be for a global future of hope for international freedom and democracy, and against a global future of ever-increasing concentration of wealth and power into fewer and fewer hands. In this, his first statement on the subject, he spoke actually in favor of the world’s public, against the world’s aristocrats (or ‘oligarchs’, as The West’s billionaires refer to billionaires who are not in the richer Western countries).

This key decision, upon which the world’s future now depends, will be between a continuing erosion of the significance of international law (which laws come from the U.N. and its agencies) and a proportionate increase in what the U.S. Government calls “the rules-based international order,” in which America’s Government increasingly controls (and even sets) those “rules” that will replace international laws; versus a future in which what erodes will instead be the U.S. Government’s international power to control the world in its own (billionaires’) favor, and, so a future that correspondingly benefits the global public (the very people who suffer from the aristocracies’ — especially America’s aristocracy’s — increasing control over the entire world). On the one side, the U.S.-and-allied side, stands Davos, the Bilderbergers, the Trilateralists, and the rest of the “Washington Consensus,” the view of the U.S.-and-allied side, that America should control the world; and, on the other side stands the United Nations side, the view that neutral and internationally democratically based and neutrally applied international laws should instead control the world, without favoring America’s, or any other country’s, billionaires. 

Here is how the Nobel-Peace-Prize-winning U.S. President Barack Obama, in a speech that he delivered to America’s future generals, at West Point Military Academy, on 28 May 2014, stated the U.S. Government’s position on this matter, which is the key issue concerning international relations, and the global future: 

The United States is and remains the one indispensable nation. That has been true for the century passed and it will be true for the century to come. … Russia’s aggression toward former Soviet states unnerves capitals in Europe, while China’s economic rise and military reach worries its neighbors. From Brazil to India, rising middle classes compete with us, and governments seek a greater say in global forums. … It will be your generation’s task to respond to this new world.

He was telling his military that America’s economic competition, against the BRICS nations, is a key matter for America’s military, and not only for America’s international corporations; he was saying that U.S. taxpayers fund America’s military at least partially in order to impose the wills and extend the wealth of the stockholders in America’s corporations abroad; and he was saying that the countries against which America is in economic competition are “dispensable,” but that America “is and remains the one indispensable nation.” So, ONLY America is “indispensable”; all OTHER nations are not, in that view. Not even America’s ‘allies’ — such as Germany, France, Japan, etc. — are. All of them are “dispensable. This, supposedly, also (and most especially) authorizes America’s weapons and troops to fight against countries whose “governments seek a greater say in global forums.” In other words, Obama was saying: Stop the growing economies from growing faster than America’s. 

There is a word for the American Government’s supremacist ideology: it is called “neoconservatism.” The general phrase that describes it is “imperialist fascism.” (Neoconservatism is purely America’s imperialist fascism.) Imperialist fascism (of ANY sort) is exactly what America’s President FDR had invented and intended the U.N. to terminate permanently by creating the United Nations to be an international democracy of nations outlawing any and all imperialisms, but FDR’s immediate successor, Truman, instead chose to continue imperialist fascism, but this time for America itself to become the all-encompassing global power. (He was the original neoconservative.) America quickly became the imperialist-fascist power; and, it has remained so even after the Soviet Union ended in 1991 — in fact, that event super-charged America’s fascist imperialism. And Obama super-super-charged it, by his February 2014 coup that grabbed Ukraine on Russia’s border, as a launching-pad from which Russia will ultimately be attacked.

Like another neoconservative, though of the opposite political Party, John Bolton, famously said: if the U.N. headquarters building “lost ten stories, it wouldn’t make a bit of difference.” America’s Presidents and Congresses are bipartisanly neoconservative, almost 100% in favor of ceaseless increases in the control that America’s Government has over the world. They are happy that the U.N. has become little more than a talking-forum.

That brings us to the present.

On 13 May 2022, Reuters headlined “Erdogan says Turkey not supportive of Finland, Sweden joining NATO”, and reported that

President Tayyip Erdogan said on Friday it was not possible for NATO-member Turkey to support plans by Sweden and Finland to join the pact, saying the Nordic countries were “home to many terrorist organisations”.

Finland’s plan to apply for NATO membership, announced Thursday, and the expectation that Sweden will follow, would bring about the expansion of the Western military alliance that Russian President Vladimir Putin aimed to prevent by launching the Ukraine invasion.

“We are following the developments regarding Sweden and Finland, but we don’t hold positive views,” Erdogan told reporters in Istanbul.

Irrespective of how he might define “terrorist organizations,” what he really was saying there is that Turkey, as a member of America’s NATO military alliance against Russia, will veto the proposed addition to NATO (i.e., to its Article 5, which obligates every NATO member-nation to attack and join in conquering any nation that attacks ANY nation that is a member of America’s NATO military alliance) of Finland, which has the second-nearest border to Moscow (only a 7-minute missile-flying-time away), which is second ONLY to Ukraine (which is just a 5-minute missile-flying-time away from Moscow), as being the Russia-bordering nation that would pose the biggest danger to Russia if added to NATO. 

By Erdogan’s siding with Putin, not Biden, on this, the most crucial decision in international relations in our time, Erdogan would be standing firmly WITH the nations that the super-imperialist fascist Nobel Peace Prize winner Obama derisively referred to as being not merely “dispensable” but also as being the “rising middle classes [who] compete with us, and governments [who] seek a greater say in global forums” — Erdogan was siding there AGAINST the mono-polar U.S. global empire, and FOR the multi-polar global community of independent nations under international law (NOT “the rules-based international order” in which America’s Government increasingly controls, and even sets, those “rules” that would replace international law). 

NATO’s Article 10 states that:

The Parties may, by unanimous agreement, invite any other European State in a position to further the principles of this Treaty and to contribute to the security of the North Atlantic area to accede to this Treaty. Any State so invited may become a Party to the Treaty by depositing its instrument of accession with the Government of the United States of America. The Government of the United States of America will inform each of the Parties of the deposit of each such instrument of accession.

Turkey, according to Erdogan on May 13th, will veto not only Finland but also Sweden.

NATO’s Article 5 states that:

The Parties agree that an armed attack against one or more of them in Europe or North America shall be considered an attack against them all and consequently they agree that, if such an armed attack occurs, each of them, in exercise of the right of individual or collective self-defence recognised by Article 51 of the Charter of the United Nations, will assist the Party or Parties so attacked by taking forthwith, individually and in concert with the other Parties, such action as it deems necessary, including the use of armed force, to restore and maintain the security of the North Atlantic area.

Any such armed attack and all measures taken as a result thereof shall immediately be reported to the Security Council. Such measures shall be terminated when the Security Council has taken the measures necessary to restore and maintain international peace and security.

If the United States Government succeeds in its (ever since 25 July 1945) ceaseless drive ultimately to replace the U.N. by itself (America) as being the ultimate source of “the international order,” then ONLY America’s billionaires will possess real seats at the international tables where the fates of nations and of their respective publics are being determined. Perhaps Erdogan is finally throwing in his lot with Russia, China, Iran, and the other nations that are standing opposed to imperialistic fascism, and in favor of the international democracy of nations that FDR had hoped would follow in World War II’s immediate wake (but which Truman made neutered and devoid of any real power). No other NATO-member-nation’s leader has, thus far, been so bold as to have announced that his nation will vote in NATO against Finland’s bid to join NATO.

Erdogan’s rationale for his statement, and the extent of his commitment to it, weren’t made entirely clear in that statement, but, in any case, his statement on the matter, at that time, was strong enough to cause America’s international propaganda-agency, RFE/RL, to headline “Turkey’s Erdogan Says He Opposes NATO Membership for Sweden, Finland”, and to allege that “Ankara risks a backlash from its NATO partners over its opposition to Sweden’s and Finland’s membership.” Certainly, there would be a “backlash” from Biden, who, after all, heads the only ‘indispensable’ country.

However, on May 14th, Reuters headlined “Exclusive: Turkey ‘not closing door’ to Sweden, Finland NATO entry, Erdogan advisor says”, and revealed that this matter was merely a negotiating ploy by Erdogan, to get the Kurdish separatist organization, PKK, which is called “terrorist” by Turkey, outlawed in Europe too. Erdogan has no principled position regarding the U.S. Government’s taking over the entire world, but instead is using the issue of Finland and Sweden being allowed into NATO as a lever to force those two countries, and all of the EU, to outlaw the PKK. This internal Turkish matter, not the world’s future, is what motivates him; and he is using the NATO-expansion question in order to force other countries to assist Turkey’s Government to crush the PKK, against which Turkey has been fighting for decades.  

Everything’s Getting Messy Again In Afghanistan

15 MAY 2022

Source

By Andrew Korybko

Afghanistan’s internal insecurity, border tensions, and the potentially Pakistani-backed US military factor are combining to create yet another storm in the New Cold War that threatens to destabilize the region.

Russia’s ongoing special military operation in Ukraine and the US-led West’s unprecedented response to it have distracted the international community from Afghanistan, which is once again becoming an issue of regional concern. The foreign occupiers’ chaotic evacuation from that country last August and the Taliban’s return to power in the aftermath haven’t stabilized the situation all that much. The group is still designated as terrorists by most of the world and their leadership remains unrecognized despite all stakeholders – including Russia — still interacting with them for pragmatism’s sake.

Afghanistan somehow avoided the full-scale humanitarian crisis that many were worried about but its people’s most basic needs still aren’t being adequately met. Observers also feel very uncomfortable about the Taliban returning to its old ways by once again banning women from showing their uncovered faces in public. The comparatively more secular and ethnically cosmopolitan northern part of the country that’s majority inhabited by Tajiks and other Central Asian people might not take too kindly to this decree, which could fuel anti-government movements there.

In fact, it was reported just this weekend that the “National Resistance Front” (NRF) has returned to fighting against the Taliban in the Panjshir Valley. Russian Foreign Minister Sergey Lavrov was asked about this on Friday following the CIS Foreign Ministers Council meeting in Dushanbe where he reiterated Moscow’s stance that the only sustainable political solution is to form an ethno-regionally inclusive government. He also expressed optimism that “our allies in Tajikistan with serious influence in Afghanistan, primarily the country’s north, will also keep helping us achieve our common goals.”

That former Soviet Republic is a key stakeholder in Afghanistan since it exerts influence over its co-ethnics across the border and was previously suspected of supporting anti-Taliban forces there. President Putin also spoke to his Tajik counterpart Rahmon on Friday, during which time the two discussed Afghanistan and confirmed that they’ll “continue to cooperate to ensure security on the Tajikistan-Afghanistan border.” This is especially important following reports that ISIS-K terrorists from Afghanistan recently claimed credit for a cross-border attack that Tajik officials nonetheless denied.

On the topic of cross-border terrorism emanating from Afghanistan, neighboring Pakistan reportedly carried out several strikes there in the middle of last month against TPP terrorists who martyred several of their soldiers days prior. Islamabad also reportedly just handed over two top TPP commanders to the Afghan Taliban, who’ve been mediating peace talks between them. Amidst all of this, Pakistan remains mired in political uncertainty following its scandalous change of government in early April that former Prime Minister Khan claims was orchestrated by the US as punishment for his independent policies.

While its internal security situation is expected to remain stable considering the world-class professionalism of its military and intelligence services, speculation abounds about the trajectory of its foreign policy. Newly inaugurated Foreign Minister Bhutto’s upcoming trip to the US is inconveniently occurring at the exact moment that its political, economic, and international uncertainties are converging. The relevance of this to Afghanistan is the US’ recent reaffirmation that it retains the capabilities to strike terrorists in Afghanistan if it so chooses, perhaps with speculative Pakistani support.  

Former Prime Minister Khan claimed that the alleged US-orchestrated regime change plot against him first started when he publicly said that his country will “absolutely not” host any American bases in the wake of the US’ withdrawal from neighboring Afghanistan. Critics of the new authorities who replaced him suspect that they might be secretly negotiating some sort of military arrangement with the US to facilitate American anti-terrorist strikes there, which could possibly target ISIS-K but also the TTP that Washington also officially regards as terrorists just like Islamabad does.

While there’s nothing of tangible substance to base this speculation on, it’s still a matter of public record that the US said on multiple occasions that it’s actively seeking out regional bases to facilitate its so-called “over-the-horizon” strikes in Afghanistan. Russia was concerned that its American rival might poach one of the Central Asian Republics from its informal “sphere influence” into this scheme, though that hasn’t materialized, at least not yet. Even so, Moscow must be watching Washington’s reported $20 million unarmed Puma drone deal with Dushanbe with suspicion to see where it might lead.

On the topic of cross-border attacks, it also deserves mentioning that reports came in a few weeks back alleging that tensions were boiling along the Afghan-Iranian border. Tehran denied that any clashes took place but most observers still consider ties between it and the Taliban to be very complicated, to say the least. Taking stock of the overall situation, Afghanistan’s domestic stability has been rocked by ISIS-K suicide bombings and the latest reported “NRF” offensive while international tensions are dangerously growing between the Taliban and its Iranian, Pakistani, and Tajik neighbors.

Against the backdrop of the Taliban imposing its strict socio-religious standards onto the rest of the population in spite of the risk that this will only worsen resentment from some minorities against it, as well as the country’s humanitarian crisis being far from resolved even though it hasn’t yet exploded, it can be concluded that everything risks spiraling out of control if all these counterproductive trends aren’t soon reversed. Pakistan’s crossing of the Rubicon by kinetically defending its objective national security interests through reported anti-TTP strikes also adds an unpredictable dimension to this too.

The same can be said for the pivot towards the US that the new authorities’ critics suspect is unfolding and which might manifest itself through those two unofficially teaming up to occasionally fight terrorism in Afghanistan. The US is still actively searching for a regional base, which can only realistically be in Pakistan if it ever comes to pass since its new Tajik partner can’t legally host one without Russia’s approval due to its legal commitments through the CSTO mutual defense pact. Any enhanced Pakistani-American anti-terrorist and/or military cooperation could greatly reshape regional dynamics.

All the while, there’s also some positive news too even though it pales in comparison to the negative. Foreign Minister Lavrov spoke at the beginning of the month about the need for mutually beneficial economic engagement with Afghanistan, which he repeated on Friday after the CIS meeting that was hyperlinked to earlier in this analysis. New Taliban-appointed Afghan charge d’affairs to Russia Jamal Nasir Garwal, who also reportedly attended the Victory Day parade in Moscow, publicly reciprocated this interest by emphasizing how much his country needs Russian energy resources right now.

These signals prompted speculation that a Taliban delegation might soon travel to Moscow to discuss such deals, though Russian Special Presidential Envoy to Afghanistan Zamir Kabulov denied that anything of the sort was in the cards at this moment. Still, that would represent a positive development if it comes to pass and would complement the Taliban’s planned economic cooperation with China. The larger trend seems to be that while Afghanistan’s ties with Iran, Pakistan, and Tajikistan become more complicated, its ties with Russia and China are becoming more comprehensive.

To be absolutely clear, correlation doesn’t mean causation so nobody should think that regional stakeholders are dividing into pro- and anti-Taliban blocs, but it’s still an important trend to pay attention to since it suggests that Russia and China might soon be able to exert more influence over the Taliban than previously expected. In the event that Pakistan strikes some sort of anti-terrorist or military deal with the US as part of its speculative plans to repair ties with it through such arrangements that critics might describe as concessions, then those two might become more suspicious of its intentions.

After all, Pakistan has unofficially frozen talks with Russia over what former Prime Minister Khan insists were his previously active negotiations to purchase fuel from Moscow, including at a 30% discount, but which the new Energy Minister claimed had never happened. The latter said this in spite of there being documented evidence from credible sources confirming that his statement was factually incorrect, including Foreign Minister Lavrov revealing while in Islamabad on 7 April 2021 that there was “mutual interest” in this, “appropriate proposals have been put forward”, and Russia is “waiting for a response”.

The scandal over Russian-Pakistani energy talks concerns much more than just those two countries since all interested observers can now see that the new authorities are publicly distancing themselves from their predecessors’ negotiations with the Kremlin for whatever reason, even going as far as to share factually incorrect information with the public about this. The impression that they’re probably left with is that this might be done under American pressure, which in turn adds credence to former Prime Minister Khan’s narrative about the US being behind his ouster and now influencing his replacements.

This insight is pertinent for Afghanistan since it also adds credence to suspicions that Pakistan and the US might be secretly negotiating some anti-terrorist or military deals focused on that war-torn country, with Islamabad possibly even conceding on some issues that its prior government never would have in pursuit of clinching such an agreement in the hopes of repairing its troubled ties with Washington. The reintroduction of US forces to the region, even clandestine ones such as CIA drone teams, could be very destabilizing and thus contribute to even more uncertainty about Afghanistan’s overall situation.

The scenario of Pakistan’s new authorities, who rose to power through scandalous circumstances that the ousted premier attributed to a US-orchestrated conspiracy, facilitating the American military’s and/or intelligence’s return to the region would certainly be frowned upon by all regional stakeholders. No matter what’s said between their diplomats, it’s doubtful that they place much trust in that country’s new leadership after its Energy Minister passionately insisted that former Prime Minister Khan was lying about his energy negotiations with Russia in spite of the official facts contradicting him.

The uncertainty about Pakistan’s grand strategic trajectory after its recent change of government and the credible concerns that its new leadership is preparing to decisively pivot towards the US contribute to the larger uncertainty about everything associated with Afghanistan right now. The overall situation is negative and there’s too much “fog of (hybrid) war” to confidently predict where everything is headed. Afghanistan’s internal insecurity, border tensions, and the potentially Pakistani-backed US military factor are combining to create yet another storm in the New Cold War that threatens to destabilize the region.

Why Russia´s oil ban is impossible

May 15, 2022

Source

by Jorge Vilches

How can you be so sure Jorge ? Please allow me 10 minutes to make my case with this focused, easy to follow, all-inclusive, and fully vetted explanation. Then I humbly and cordially challenge any individual or institution to prove me wrong. If history is any guide, banning Russian oil would turn EU members into failed states. Furthermore it would FUBAR world market dynamics by altering Russia´s current stabilizing role thus triggering moving parts into motion.

6 key criteria

Beware: the reliable provision of Russian oil to the EU is essential because of its quality, quantities, price, service and delivery enlargement that Europe needs to constantly grow. Banning Russian oil means finding many different oils – from many new unproven vendors – that would have to render the same homogenized profile of delivery, quality, quantity, price, service and enlargeability that Russia reliably provides today. Nothing less, of course. Think about it.

Otherwise we cannot have the Europe we now know and the future Europe we need. All 6 factors are required. Not enough quantity adequately delivered means degraded European lives and failing economy, with shut down plants and refineries affecting transportation, heating, hospitals & schools, highly limited military, unemployment, etc., etc.

A different or lower oil quality means poor performance and operational risks with serious breakdown troubles and injuries plus down-time probably beyond repair. Not low enough price — Russian fuels are good & cheap — means disrupting the EU and the world with inflation beyond imagination. And as Procurement Depts. know well, an utmost reliable vendor service is paramount also to allow for mutual growth. Russia is a vetted, close-by, one-stop, well “oiled” 6-criteria compliant vendor. Instead, the EU´s losing proposition is a far away beach-front bazaar with seaborne delivery only, shipped by a fleet too small for purpose. A single non-compliant vendor is simply unacceptable, period.

Furthermore, Russia´s oil sales to Europe provide a stabilizing critical mass to compensate for world market variations

3 impossible missions 3

The huge problem is that there are 3 and only 3 ways out of this terribly EU mis-managed fuel sourcing hellish-crazy messy mess. For all 3 options in order to comply with the 6 oil criteria briefly explained before (more on that later) the EU would be required to import variable quantities from several different yet unknown vendors having

(1) fully compliant export-ready oil grades to be produced beyond and incremental to current production (#)

and/or…

(2) fully compliant oil grades found deep underground somewhere yet unknown per definition 0% available today

or…

(3) modify every single piece of machinery in the EU to fuel them with different non-compliant non-Russian oils…

and with no possible “toggle switch” to convert from one type of oil to another… We´d have a forcefull life-long linkage between one vendor and his supposedly constant oil deliveries, which would be different from other vendors and their supposedly constant deliveries made to other EU consumers. NO interchangeability here.

(#) It´d have to be “incremental” export volumes beyond current production for two reasons: one would be potential growth in EU demand and the second reason is that no vendor will leave traditional customers abandoned high & dry just because the EU has now gone bananas. Furthermore, these contracts could might all turn out being short-term ephemeral un-sustainable ´purchases of convenience´ without continuity to be dropped the instant the EU´s “ban Russia´s oil” stops dead in its tracks for plenty of good reasons and thus discarding this nonsensical idea altogether.

Be it as it may, all 3 options require to find, negotiate, contract, plan for, test, schedule and get delivery of fully compliant Russian-oil substitutes. Per definition Option (2) does not exist today – if ever — and can only be considered for 2030 planning purposes or beyond in view of the firm 2022 EU deadline premise. Option (1) requires to import varying qualities, quantities, and prices of oils currently in production somewhere, if any are found, which as explained later due to current circumstances and overlapping requirements turns out to be 99% doubtful. Option (3) requires to modify, retrofit and adapt each and every European refinery, chemical & processing plant, machinery, engines, etc. etc. — everything powered by fuels really — for individual, specific not-interchangeable non-Russian oil substitutes which would all be slightly different at the very least and expensive. As shall be duly shown Option (3) is impossible.

“ We will make sure to phase out Russian oil in an orderly fashion in a way that allows us and our partners to secure alternative supply routes and minimises the impact on global markets” – said Ursula von der Leyen, President of the European Commission. Quick response, no that will NOT happen Ursula. Neither markets nor Russia nor EU Green Standards nor prices nor regulators will let you do any of that. It will necessarily be very chaotic although most Europeans may not yet know it. Renewables and fancy footwork such as hydrogen or dirty coal & fuel oil will make things worse. Bankruptcies and unemployment would follow. Specifics are presented later herein. Let me explain.

Ref #1 https://oilprice.com/Energy/Energy-General/Why-Renewables-Cant-Solve-Europes-Energy-Crisis.html

Ref #2 https://worldcrunch.com/business-finance/europe-russian-gas/floating-lng-terminals

Ref #3 https://worldcrunch.com/business-finance/europe-russian-gas/particle-4

timing, volumes & judo

Now comes what would normally be described as a multiple-ring circus with the animals and clowns running lose.

Technically speaking, all three options should be dismissed altogether, particularly under current most unfavorable circumstances. Also beware that Europe needs to avoid a self-inflicted Armageddon depression. The reason is an EU ban on Russian oil means per Option (1) to engage in a years-long import development project with non-vetted vendors (from Africa ?) covering absolutely 100% of all the EU current and future oil consumption. So the EU should necessarily replace ALL the Russian oil Europe could possibly ever consume, NOT just a part. Because Russia now has other priorities and will no longer cooperate with and adapt to EU needs and timing in any way. So forget about gradual Russian oil substitution. It´d be the opposite Ursula. For example, and just to entertain the idea, even if eventually achieving constant delivery of 75% fully-compliant non-Russian oil per Option (1) – impossible — it´d still mean digging a 25% deep hole into Europe´s economy, which Russia will not help to solve by supplying the missing 25% oil. The Druzhba pipeline supplies land-locked refineries in Poland, Germany, Hungary, Slovakia and Czechia, so no need to shut down all of Europe. Just triggering a strong negative impact on a couple of countries would be enough A brief cut-off on Germany´s Schwedt refinery or Slovakia´s Slovnaft would be unbelievably catastrophic by shutting down continuous year-round processes which cannot be re-started and would mean irreparable harm. So the EU would need to substitute forever with whatever ALL of the almost infinite and excellent quick & safe delivery Russian oils. Europe just makes naïve and rigid moves ignoring Russia´s clever dynamic capabilities. Judo comes to mind. Ask Finland how does the Russian gut punch feel while now being cut off from both Russian nat-gas and electric power.

Ref #4 https://www.rt.com/business/555414-russia-gas-supplies-finland/

Ref #5 https://www.wionews.com/world/russia-to-suspend-finland-electricity-supply-from-weekend-over-payment-issues-478731

the solar system (… and beyond)

And if EU politicians don´t know or don´t care they´ll still very soon participate front and center in a fast & furious crash course on basic high school chemistry that will turn their faces pale, I promise. Hungary has publically exposed the problem: “the EU has ‘no solution’ to fix damage from Russian oil ban”. Also promised, history will not be kind with the EU leadership both for absent fuels and everyday consumer staples with “prices out of the solar system”. The EU relies on cheap and efficient Russian energy for many things such as transportation, heating, and electricity. The drop in supplies will lead to blackouts, shutdowns in industries and unemployment pushing inflation to unmanageable levels Ref #6 https://www.rt.com/news/555297-hungary-eu-no-solution/ .

Ref #7 https://oilprice.com/Energy/Energy-General/Record-High-Diesel-Prices-Will-Ripple-Across-The-Economy.html

Ref #8 https://www.zerohedge.com/markets/record-airfares-and-soaring-food-prices-whats-behind-todays-surprise-cpi-beat

Ref #9 https://www.rt.com/business/555295-ukraine-block-russian-gas-explainer/

OIL - Santos Holding

renewables do not help

Renewables have other known serious problems but also require humongous loads of Russian nat-gas, oil, coal, minerals and commodities. Wind turbines require thousands of tons of nickel and rare earths. Any such large structures are moved and erected with Russian fuel-powered equipment. Solar energy requires silver beyond belief. When renewables in large quantities are added to the electrical grid, costs go up – not down — as they have to be backstopped by thermal plants that today run on Russian fuels. “The more renewables you add, the more natural gas you need”. Ref #10 https://www.zerohedge.com/geopolitical/lighting-gas-under-european-feet-how-politicians-journalists-get-energy-so-wrong

delivery + quality + quantity + price + service + reliability

The 3 options above are impossible to deploy for many reasons besides timing. For example, even if ever found, these 3 options need to be contracted, planned for, tested, scheduled, and delivered under very strict conditions that Russian sources already comply with regularly and reliably. Europeans are necessarily very much used to proven, vetted, Russian vendors and will not be acceptable to find it otherwise. It´d hurt Europe badly and possibly leading to outward chaos by continuous damage beyond repair of machinery, processes, sensitive devices and installations that EU plants currently have in place. With Russian sourcing, European production runs swift and smooth humming in all 8 cylinders… but not so with possible others… even if physical deliveries were adequately met. Also it´s easy to imagine vendors having something that Europe would buy, that still under current circumstances would not even wish to entertain the idea of offering anything to Europe let alone helping it out in any way shape or form. Think India and China, the world´s factory countries in many ways. And of course Russia would not help out Europe in any of the above 3 impossible missions. Russia will naturally – and probably very effectively — hinder any European effort or solution to replace Russian exports. The risky low tides and strong headwinds are fully against Europe, not Russia.

petro-logistics 101

So then why do I say ´impossible´ ? The short answer is that “petro-logistics” make it physically impossible to ban Russian oil from Europe no matter how it´s diced or sliced as explained hereinafter in layman´s language. The name of this game means that “plug & play” of ensured adequate substitutes for Russian oil grades – options (1) and (2) respectively — are and will always remain clearly absent in quantities anywhere near large enough to make any difference for European needs. Chemical composition and physical parameters matter lots. Options (1) & (2) are out.

Option (1) – In the very best of cases, only useless, tiny small, and sporadical deliveries — if any, actually — would ideally be found, let alone effectively contracted on a necessarily predictable basis. I´d call them minor deliveries of substitutes not comparable to Russian oil. At any rate, the above would be operationally un-manageable as no plant can run if receiving supplies on a highly variable and ocassional basis of now-you-have-it (maybe) now-you-don´t (sorry) with feeds of dubious quality and composition. The EU today has highly sensitive plants finely tuned and used to Russian high quality oil during decades. So no plant runs without continuous, foreseeably constant feed of the right quality product (read chemical and physical properties) in large enough quantities which most probably will grow in time as demand increases. Otherwise no processing works as expected, or I´d rather say nothing works, period. This is shared by anybody with minimum plant hands-on or managerial experience, even millennials. So these facts all by themselves pretty much blow out options (1) and (2) out of the water. I confess that many times I disbelieve having to present such basic explanations. And no high sulphur content allowed as hydrotreating has reached its limits long ago

In a nutshell, the world wasn´t anywhere nearly prepared for an EU ban on Russian oil… or other Russian fuels…

Franz marries Natasha

Early this century, former German Chancellor Gerhard Schröder´s philosophy and policies led to a very clear and conclusive European strategy vis-á-vis energy sourcing. Very simply put in everyday terms, fuel-wise Europe married fuel-rich Russia and soon had plenty of babies that have now grown-up and crave for Russian food. Now enter the violent situation re Ukraine thru NATO´s provocation according to Pope Francis, and with an idle North Stream 2 fully wasted and just sitting pretty. So the whole European successful exporter industrial base was conceived, designed, built, and operated under the ´Russian fuels´ premise. That is why every EU government has failed to find the architectonics — let alone build — a realistic energy strategy that does not depend exclusively on Russia´s capability as an EXTRAordinary and reliable commodities exporter, most specially fuels. So Franz married gorgeous Natasha and raised a family. But now, per Anglo-Saxon ill-intentioned directives, Franz forces a divorce. The problem is that their children still demand Natasha´s Russian food. Ref #11 https://www.politico.eu/article/pope-francis-nato-cause-ukraine-invasion-russia/

helpfull SKovacs

The comments section of my latest article gained greatly from the input offered by SKovacs an excellent and friendly poster who shared his first hand 30-year knowledge in the oil & gas business with us all.

Please see link referenced below. So I´ll just summarize and/or quote what this most experienced poster had to say

  1. many EU refineries have been built to process certain types of oils found in Russia. The very design & build of these refineries (and petrochemical plants) was based on certain specific oil types within narrow variation in blend/quality and steady supply — variation normally of less than 15% vol/day — guaranteed for over 30 years (most commonly 50+ years). Obviously enough, the continuous supply of quality feeds is critical to the operation of a refinery or any chemical plant.
  2. adapting an EU refinery to new types of oils is not an easy task. Every adaptation of a chemical plant or refinery or ore processing plant requires first a detailed laboratory knowledge of the new blend, and formal guarantees for its continuous delivery for decades, convoluted & lengthy contracts and procurement processes, extremely detailed engineering plans, manufacturing of parts, shipping, installation, testing, commissioning, optimization, permitting etc. etc. etc. before it can be declared “done”. Any element of this incomplete list, if missing, renders the whole affair a failure both technically and economically…
  3. the above assumes guaranteed efficient and continuous shipping and receiving network(s) are always in place and fully operational (!) Such work involves thousands of people, complex processes and of course many billions of euros, regulatory permitting process, inherent lawsuits etc., i.e. A LOT OF TIME – years !
  4. Europe deprived of oil/gas/metallurgical coal from Russia — and also iron ore — is unlikely to build much. Never mind the finer components that require other alloy metals which are also provided by Russia…

Ref #12 https://thesaker.is/europes-mad-ban-on-russian-oil/

matched & mated

As already described, chemical plants and refineries are very closely matched and subtly calibrated to very specific and foreseeable supply feedstocks which are also very difficult to substitute. Changing anything requires lots of time, effort, money, dedicated facilities, experimentation, specific expertise, risk, and most important fixed, unchanging feeds always complying with specs. This means that Russia today supplies Europe with exclusive unreplaceable oil & gas grades of very specific chemical content (even coal grades) that would be impossible to get from third parties fast enough and cheap enough. So it´s a very delicate and tight matching already achieved between European facilities and reliable and vetted Russian fuels and other inputs that cannot be altered or replaced, let alone all at the same time (!!) or else… So another factor is the “sudden death” moment, no possible easy-does-it slow and smooth transition phasing out the Russian stuff one at a time and gradually phasing in our new whatever stuff… It´d be like trying to change a tyre as you keep driving without ever stopping the car okay ? Ref #13 https://www.ifo.de/en/node/69417

what for ?

And this banning of Russian oil idea defeats the supposed purpose as Russia would end up earning much more by exporting far less. And the higher the price of oil, the higher the inflationary pressure worldwide destroying the income of regular people. Go figure…By the way, it´s a single oil world market Ref #14 https://www.bbc.com/news/business-60656673

And of course, Russia wouldn´t dare to retaliate against its oil ban with delivery reductions of, say, gas or uranium, would they?

logistics

Banning Russian oil also means altering the traditional direction of logistic flows which is costly and risky. New shipping freighters are unprepared for unknown delivery schedules and product specs. Ports and oceans are different, same with shipping lanes, climates, seasonal availabilities of hydrocarbons and shipping vessels types and sizes which means lots of negotiation, coordination, funding, expertise, risk, new fixed and variable costs and surprises from yet unknown trade and business partners, new procedures, brokers, insurance companies, etc. Also expected continuity, LNG & LPG terminal bottlenecks, processing, availability, cost, weather restrictions when most needed.

Russia´s oil & gas pipe delivery to the EU is safe, clean, and cheap. Russian sea freighted oil comes for nearby ports.

EU acquatics + age & Whatsapp

Altering the Russian energy sourcing strategy now leaves Europe gasping for air with its nose dangerously close to the waterline. By design, chemically speaking Russian feeds are a European absolute sine-qua-non. It is technically unfeasible and unsustainable for Europe not to count on Russian oil & gas. Politics – or war for that matter — can´t change that. If this Russian oil ban is ever implemented, European operational and maintenance staff & field personnel would probably demand being switched to other jobs… or will drag their feet… or would simply resign thus necessarily compounding the problem to unchartered depths. New, young, inexperienced hands do not help under these experimental circumstances, trust me. With or without Whatsapp, having baldy and/or grey-haired guys around is a greatly-appreciated feature/asset, never a bug. Many would be called back from retirement, read my lips.

now some petrophysics

So option (1) applies to all non-Russian oils currently under production but not necessarily offered for sale. Option (2) refers to future oil theoretically down in subsurface in yet untapped reservoirs of hyper-low possible existence in ultra-low production volumes. If you are in the business agreed it´s pure nonsense to go into the details of such an experiment. But apparently the topic now needs to be politically addressed and explained, so bear with me and so be it. To make a long story short, petro-physically speaking these Russian oil grades actually cannot exist elsewhere for very clear and well-known limiting geological parameters. So not only these oil grades can´t be sourced somewhere else but it´d also be a monumental royal waste of time and money to look for such down in subsurfaces yet unknown,

to no avail. Nobody in the business will invest time, money, expertise and valuable people in such failed idea. No way.

pain but no gain

But be it as it may with options (1) and (2) no complying Russian oil & gas grades are available anywhere outside of Russia, neither today nor in the future, let alone in quantity and quality and required vendor reliability to make any difference. And it would certainly focus the European attention properly if everyone please gets used to this idea, the faster the better, Ursula included. So the supposed ´Russian oil ban´ is impossible simply because Russian oil grades do not have and will not have any complying substitutes for the foreseeable future anywhere above or below ground. Such tremendous conclusion leaves one and only one hellaceous alternative open to be discussed in detail below – namely Option (3) — as from the “Mohammed and the Mountain” paragraph thereafter. But so as to avoid running around in circles proposing impossible chimeras, Europeans at large and most specially EU politicians should not forget that today or in the future Russian oil grades are un-replaceable for European consumption. What´s left is technically dreadful and socio-politically most dangerous as we shall soon read about below as Option (3)

LNG / LPG ?

Lots of suggested overly optimistic “solutions” were posited regarding LNG / LPG. Not so. The comments section of my latest article covered this very thoroughly. Please see link below. Most especially we should all thank SKovacs once again for sharing a lot of his 30-year first-hand knowledge in the industry with us all. So I´ll just summarize and/or quote what this most experienced poster has reported regarding LNG / LPG.

  1. There are not enough vessels — oil tankers nor lNG tankers — to replace existing pipelines. At least, a few dozen more are needed. How long and what does it take to build these? Who would build them? By when?
  2. European countries are extremely bureaucratic, so say ~20 years to have 1 LNG terminal ready where this is possible and if not vetoed by the local council. Meanwhile, a pipeline must be connected from the terminal to the existing grid… with further complications at every level. What capacity should these terminals have vis-á-vis the related new pipelines? Nobody can know that today [and thus adding even more load to timing demands]
  3. Transit times on the tankers change and existing EU southern pipelines are probably at full capacity already.
  4. Tankers are far more costly to operate as liquefied gas has to be kept liquefied re power-hungry refrigeration.
  5. Tankers have a more costly service life than other bulk tankers, if only for the regulation/inspection requirements. So therefore they are a higher risk with higher cost per cubic meter of gas transported vs. cheap, reliable, safe, environmentally friendlier pipelines.
  6. the EU needs several LNG terminals to receive and process liquefied nat-gas. The sites have to be carefully chosen, their expensive environmental impact assessments completed (which can take 5 to 15 years) with engineering design that can also take years with limited room for direct carbon copy of other designs, plus ground preparation construction would take 1-2 years + manufacturing of plant and modules (usually in Korea and China, would they now agree ? ) which need contracts, capacity, materials, etc, lots of time and shipping.
  7. By the time all is said and done ~15+ years went by per first-hand knowledge…
  8. All LNG terminals are owned/built/operated by consortiums of gigantic multinational companies, not governments. They cost 10’s of billions to design and build, which need to be borrowed from banks.
  9. The borrower must prove that it has a solid plan with guarantees in place to repay the loan with interest.
  10. The owner/operator of the terminal has all sorts of other very important liabilities.

Ref #15 https://thesaker.is/europes-mad-ban-on-russian-oil/

Russia delivers its oil & gas to some key EU locations through low-cost, safe, efficient, door-to-door clean pipelines.

Hungary has proposed to exempt all of Russia´s pipeline delivered oil from current or future EU sanctions or embargo.

Ref #16 https://oilprice.com/Latest-Energy-News/World-News/More-Oil-From-US-Strategic-Petroleum-Reserve-Heads-To-Europe.html

then nuclear maybe?

Germany had 15 nuclear plants in operation. But no more. The last 3 operating nuclear plants in Germany were scheduled to be decommissioned permanently in 2022. Part of the “Green Agenda” in the EU is to eliminate nuclear plants. France does not approve this, but is having technical trouble with its nuclear plants. France has said it will shut down 50% of its nuclear plants for critical maintenance this year at the worst possible timing imaginable. No uranium as usually imported from Russia is the final monkey wrench shoved merciless inside the guts of the European engine.

Ref #17 https://www.bbc.com/news/business-61298791

no time & no volume…

Question: but what if such Russian oil grades substitutes were prospected for and luckily found in the future ? That´s Option (2) which would first require lots of time we don´t have, plus tons of money, and a major serious ´life or death´ European-led major fossils fuels project in order to adequately and successfully explore such hypothetical reservoirs nobody has heard of today and with zero guarantees in a most risky and extraordinarily expensive business The EU Green Plan environmental agenda would not allow for that either. Plus those hypothetical reservoirs would also need to be geologically studied and mapped, with many thousands of sample cores lab tested before wild-catted or factory drilled and fracked (if allowed) to industrially produce and deliver thru today´s non-existent infrastructure in yet unknown reservoirs most surely in the middle of nowhere in politically and environmentally unstable environments.

And as happens 95% of the time, even if luck strikes big in Europe´s favor, such oil grades would only be found in very small rapidly depleting volumes (boom & bust oil towns) not anywhere close to solving the Russian massive oil availability problem Europe now faces per its own misdoings. Of course, also needed would be tons of infrastructure which doesn´t exist today, including many special heavy-duty traffic-intensive roads, thousands of housing quarters, plenty of power generation and power distribution lines and equipment, readily available water in enormously large quantities, environmental and political approval (with “not in my back yard” mentality working against you) regulator´s intervention, reasonable year-round climate, etc. etc. etc. No need to go on, is there ? Oh…

… and no money

Normally, if successful, the above takes 10 to 15 years or more (!) and even if ever found such oil grades would be prohibitively expensive as in UN-payable. Europe simply does not have or earn that kind of money which the ECB cannot print either. We are talking many trillions of euros in an already 990% overloaded financial system ready to break its own back with a single added straw. Christine Madeleine Odette Lagarde – President of the European Central Bank — would not authorize such nonsense, sanctions or no sanctions. She knows better than that.

physical chemistry & engineering

So Russian oil grades do not have available substitutes both in the needed quality and quantities, neither currently under production nor subsurface for future exploitation. Accordingly, the only other possible solution is exactly the other way around ( Option 3 ) which does exist as a most unprobable possibility and is enormously difficult and time + resource consuming to execute. Actually, under current circumstances, this “other” alternative is absolutely impossible to put into practice simultaneously and throughout Europe with the same fixed deadline. When you “phase out” all of the current Russian oil as the EU´s leading politician Ursula von der Leyen emphatically repeats… well, to put it kindly Ursula… you better simultaneously “phase-in” the corresponding operationally-adequate replacement for such. Or else you would be perpetrating the Mother of all Suicides of the Europe we know. Such phase-out / phase-in tango is very difficult to dance about with, let alone without absolutely any help from Russia. So, as if they had not learned anything during the past two centuries, Europeans are happily playing Russian roulette with their own gun.

Mohammed and the mountain

Refineries and chemical plants cannot be fed anywhere near the way you feed your dog, period. This means that if the Mountain won’t go to Mohammed, then Mohammed must come to the Mountain, namely all of these highly technical European chemical plants, refineries and machinery have to be either (a) newly built from scratch or (b) completely re-vamped and retrofitted thru an enormous effort that will consume humongous amounts of euros, human resources, expertise, trials & errors, risk and lots of hard work and lots and lots of TIME we do not have. Enter Option (3)

mission impossible #3

Below please find a very brief descriptive summary of the basic requirements involved for such Option (3) EU-wide project. Actually there are many more, so this listing just pretends to give readers an idea of the category and caliber of the major endeavor Europe would be facing, namely mission impossible Option (3).

All refineries, chemical plants, etc.,etc. etc. in very broad terms need to undergo all of what is explained below which has been detailed only for the sake of completeness and the corresponding credibility. But actually any minimally experienced person that only knows some basic chemistry and process engineering concepts would understand that it should be absolutely unnecessary to continue describing the head-on technical/practical crash that the whole of Europe would be facing if adopting the only remaining game in town, namely Option (3) or better yet Chaos (3)

Chinese fire drill

In sum, in order for installed plants & processing capabilities to remain as they are intact & untouched, per options (1) and (2) Europe would need to effectively find, negotiate, contract, plan for, test, schedule and receive year-round rain or shine come hell or highwater adequate Russian oil grade substitutes in the right quantities, qualities, vendor reliability and prices. That is out of the question as it just doesn´t exist and will not exist either for reasons explained.

The only card left is to modify all current European chemical plants and refineries etc by adapting them to whatever feeds of whatever quality and variations are effectively found, contracted and delivered by non-Russian vendors willing and able to sell to Europe under current circumstances. Oh, by the way, this would have to be done throughout Europe and all at the same time. A Chinese fire drill would be considered a well-organized event in comparison.

Option (3) : modify, adapt, retrofit European refineries, chemical plants, equipment etc for non-Russian substitutes of unknown origin with yet undefined all-around characteristics nor vendor track record. These oils would all be slightly different (not interchangeable) and definitely more expensive. No “toggle-switch” for alternate feed of different oils.

Option (3) requires executing the above modifications to every single European plant and piece of equipment at the very same time and with the same deadline. Of course, this is impossible to do simultaneously. And it´d still be monstrous to do it gradually, but if the decision were ever made it would require Russia´s accommodation so as to allow for a gradually growing part of EU industry modified and fueled by new non-Russian sources while the rest still awaits modification thus still requiring Russian oil grades which Russia would not supply in the way that Europe would need to keep importing. The human resources and expertise required are nonexistent even if every single retired engineer and technician went back to work very hard. IMPOSSIBLE in many ways, just simply IMPOSSIBLE

  • Overall agreement on European energy sourcing philosophy (years)
  • Role of nuclear energy & LPG / LNG & renewables (years)
  • European Green Plan implementation status and goals (open, probably never)
  • Oil & gas & coal substitutes and suppliers approval to replace Russian imports (years)
  • Schedule, plans, consultant vetting + industry input & feedback for new feeds (years)
  • Site selection candidates for each country with adequate location for new plants (many months)
  • Pre-feasibility studies + regulator´s Report approval (more years)
  • Feasibility studies + regulator´s approval and involvement (yet more years)
  • Detailed engineering + plans + specs + drawings, etc.etc ( several years )
  • Contractor bidding process re civil works, electromechanical contracts, etc. etc. etc. (years)
  • Bid evaluation process, bid homologation and Contractor selection (months)
  • Final design, construction, manufacturing of parts, shipping and installation (years)
  • Trials, testing, commissioning, optimization, permitting (many months)
  • New oil & gas feed contractor pre-selection (many months)
  • Contractor bidding process etc. etc. etc. (many months)
  • Bid evaluation process, bid homologation and Contractor selection (months)
  • Trials and Testing (many months)

All of the above is explained in the simplest possible language for an enormously broad & technical topic but that still affects everybody´s own daily lives. The time periods estimates required mostly do not overlap, they are sequential.

Ref #18 https://www.rt.com/news/555258-uk-energy-heating-cost/

Ref #19 http://theeconomiccollapseblog.com/18-signs-that-food-shortages-will-get-a-lot-worse-as-we-head-into-the-second-half-of-2022

Not mentioned, one way out is to rewind back to Feb. 1 for the EU to keep buying Russian oils directly from Russia. Another way out is to keep buying the same Russian oil but from third parties at a far higher price, per “triangulation”.

Meanwhile, hungry bellies may focus stray minds. Ref # 20 https://www.rt.com/news/555490-baerbock-hunger-russia-war-strategy/

In the meantime, Bloomberg says – not exactly an enemy of the EU is it ? – that the Russian Ruble today is the best performing currency in the whole world Ref #21 https://www.rt.com/business/555354-ruble-named-worlds-best-performing-currency/.

The US wants to keep its status as a superpower at any cost

May 14, 2022

Source

By Zamir Awan

The US is desperate to sustain its hegemony and supremacy. It is taking extreme measures and can go to any extent to keep its hegemony and supremacy. Its Petrodollars policy has been playing a significant role, but, facing challenges recently and the US is getting nervous and crazy.

The petrodollar is any U.S. dollar paid to oil-exporting countries in exchange for oil. The dollar is the preeminent global currency. As a result, most international transactions, including oil, are priced in dollars. Oil-exporting nations receive dollars for their exports, not their own currency.

In addition, most oil-exporting nations own their oil industries. That makes their national income depends on the dollar’s value. If it falls, so does their government’s revenue. As a result, most of these oil exporters also peg their currencies to the dollar. That way, if the dollar’s value falls, so does the price of all their domestic goods and services. That helps these countries avoid wide swings in inflation or deflation.

The petrodollar system is tied to the history of the gold standard. After World War II, the United States held most of the world’s supply of gold. It agreed to redeem any U.S. dollar for its value in gold if the other countries pegged their currencies to the dollar. Other countries signed this deal at the 1944 Bretton Woods conference. It established the U.S. dollar as the world’s reserve currency.

On February 14, 1945, President Franklin D. Roosevelt initiated the alliance with Saudi Arabia.1 He met with Saudi King Abd al-Aziz. The United States built an airfield at Dhahran in return for military and business training. This alliance was so critical that it survived subsequent years of differences of opinion over the Arab-Israeli conflict.

The 1945 agreement between the United States and Saudi Arabia cemented the relationship between the dollar and oil. The petrodollar was born. In 1971, U.S. stagflation prompted runs on the dollar. Many countries asked to redeem their U.S. dollars for gold. To protect the remaining U.S. gold reserves, President Richard Nixon removed the dollar from the gold standard. As a result, the value of the dollar plummeted. That helped the U.S. economy as its export values also decreased, making them more competitive. A falling dollar hurt oil-exporting countries because contracts were priced in U.S. dollars. Their oil revenue dropped along with the dollar. The cost of imports, denominated in other currencies, increased.

In 1973, Nixon asked Congress for military aid to Israel in the Yom Kippur War. The newly-formed Organization of the Petroleum Exporting Countries halted oil exports to the United States and other Israeli allies. The OPEC oil embargo quadrupled the price of oil in six months. Prices remained high even after the embargo ended. In 1979, the United States and Saudi Arabia negotiated the United States-Saudi Arabian Joint Commission on Economic Cooperation. They agreed to use U.S. dollars for oil contracts. The U.S. dollars would be recycled back to America through contracts with U.S. companies. These companies improve Saudi infrastructure through technology transfer.

The United States uses the power of petrodollars to enforce its foreign policy. But many countries don’t fight back. They are afraid it would mean the collapse of the petrodollar system.

However, there was strong thinking against the Petrodollar concept and few Arab leaders declared to trade oil; in local currencies or any other currency, de-linking from dollars. The leading role was played by President Sadden Hussain, Col. Qaddafi of Libya, and the Syrian President. The US has punished them and changed the regimes in such countries.

China called for a replacement of the U.S. dollar as a global currency. Although, it is one of the largest foreign holders of the dollar. China influences the U.S. dollar by pegging its currency, the yuan, to it. China has signed a currency swap agreement with more than twenty countries and already trading with them in Yuan or local currencies. China is importing oil and gas from a few Arab nations in Yuan.

Russia has demanded to settle Gas bills in Rubles and a few European countries are already agreed to pay in Rubles. EU has also no objections if any member state pays in Rubles instead of Dollars. Russia is trading with few other nations in Rubles or local currencies instead of Dollars.

Russia has slashed the value of the dollar and the euro by 30% in a jiffy by linking the Russian Ruble to the value of gold and declaring to supply oil only against the Russian Ruble. Russia’s move means that now the entire world, especially Western Europe and Japan will buy the Russian Ruble by selling dollars in huge quantities, as the Russian Ruble has become the world’s most stable currency overnight after being linked to gold.

America, which does not mass-produce anything other than weapons and ammunition, is caught in a terrible economic crisis. In the event of a shrinking dollar, the US cannot cover its 306 billion budget deficit. This will cause severe unemployment and adversely affect the social safety net. This is the economic atom bomb that Joe Biden was aware of when he was talking about the removal of Putin in Poland.

Putin orders European countries to make payments of Gas and Oil in terms of Rubble and open the account in Russian banks. It will weaken the American sanctions on Russia. Although Russia has not retaliated against the American sanctions so aggressively, introduced its policies to counter the sanctions successfully.

The rapid decline of the US has made its leadership nervous and crazy. They are taking all possible measures to sustain their hegemony and supremacy. Even, though the Ukraine war is only a phenomenon, the objective is to maintain status-co. unfortunately, the US is not interested in global peace, stability, or saving human lives. The only priority is to maintain its hegemony and supremacy. To achieve this goal, the US can sacrifice Ukraine, Europe, or any heavy price. The US policy in the Ukraine war is to add fuel to fire, there is no will to stop the war, ceasefire, or save human lives. They are providing weapons, and arming civilians to lead toward a prolonged civil war, to bleed Russian and keep many countries over-engaged and let the US maintain its monopoly and the upper hand.

Russia was reluctant to attack Ukraine and has been observing restrains for quite along. Showing its genuine security concerns and alarming the US with serious consequences, but, the US kept its policy to encircle Russia.

The haphazard joining of NATO by Finland and the defense agreement with the UK is also equally a genuine threat to Russia. Russia and Finland share a long common border. Joining NATO, means, the deployment of NATO forces along the Russian border, which is a direct threat. Joining NATO by other Scandinavian nations is also a serious and matter of deep concern for Russia.

It seems the US has only one priority which is to sustain its position in the geopolitics, it ignores the genuine concerns of other nations. We are scared of the future of geopolitics and afraid the days to come may be harsh for humankind.

In history, many nations rose to the status of superpowers and ruled the world for a certain period of time, then, meltdown and passed the status of superpower to other rising nations. Like Roman Empire, Ottoman Empire, Greek Empire, British, and French empires, etc. But, The US is not willing to accept the natural cycle of superpowers and can go to any extent to keep its status of superpower forever, which is not rational nor natural, it might cause irrecoverable loss to humankind. Unfortunate!


Author: Prof. Engr. Zamir Ahmed Awan, Sinologist (ex-Diplomat), Editor, Analyst, Non-Resident Fellow of CCG (Center for China and Globalization). (E-mail: awanzamir@yahoo.com).

Empire of Bioweapon Lies

May 13, 2022

Pepe Escobar

An ongoing U.S. bioweapons program in Ukraine was one of the Top Three reasons that led to the launch of Operation Z, Pepe Escobar writes.

What are the roots that clutch, what branches grow / Out of this stony rubbish? Son of man, / You cannot say, or guess, for you know only / A heap of broken images, where the sun beats, / And the dead tree gives no shelter, the cricket no relief, / And the dry stone no sound of water. Only / There is shadow under this red rock, / (Come in under the shadow of this red rock), / And I will show you something different from either / Your shadow at morning striding behind you / Or your shadow at evening rising to meet you; / I will show you fear in a handful of dust.

T.S. Eliot, The Waste Land: I. The Burial of the Dead, 1922

This glimpse of “fear in a handful of dust” already ranks as one the prime breakthroughs of the young 21st century, presented this week by Chief of Russian Radiation, Chemical, and Biological Protection Force Igor Kirillov.

The provisional results of evidence being collected about the work of U.S. bioweapons in Ukraine are simply astonishing. These are the main takeaways.

  1. U.S. bioweapon ideologues comprise the leadership of the Democratic Party. By linking with non-governmental biotechnology organizations, using the investment funds of the Clintons, Rockefellers, Soros and Biden, they profited from additional campaign financing – all duly concealed. In parallel, they assembled the legislative basis for financing the bioweapons program directly from the federal budget.
  2. COVID-19 vaccine manufacturers Pfizer and Moderna, as well as Merck and Gilead – of Donald “known unknowns” fame, and affiliated with the Pentagon – were directly involved.
  3. U.S. specialists tested new drugs in the Ukraine biolabs in circumvention of international safety standards. According to Kirillov, acting this way “Western companies seriously reduce the costs of research programs and gain significant competitive advantages.”
  4. According to Kirillov, “along with U.S. pharmaceutical companies and Pentagon contractors, Ukrainian government agencies are involved in military biotechnology activities, whose main tasks are to conceal illegal activities, conduct field and clinical trials and provide the necessary biomaterial.”
  5. The Pentagon, Kirillov pointed out, expanded its research potential not only in terms of producing biological weapons, but also gathering information on antibiotic resistance and the presence of antibodies to certain diseases among the population in specific regions. The testing ground in Ukraine was practically outside the control of the so-called “international community”.

These findings, amply documented, suggest a vast “legitimized” bioweapon racket reaching the highest levels of the American body politic. There’s no doubt the Russians plan to thoroughly unmask it for the benefit of world public opinion, starting with a War Crimes Tribunal to be set up this summer, most probably in Donetsk.

An ongoing U.S. bioweapons program in Ukraine was one of the Top Three reasons that led to the launch of Operation Z, side by side with preventing an imminent NATO-managed blitzkrieg against Donbass and Kiev’s desire to re-start a nuclear weapons program. These are Top Three red lines for Russia.

The strength of the collected evidence may directly correlate with what was largely interpreted as a carefully measured Victory Day speech by President Putin. The Kremlin does not bluff. It will certainly privilege the meticulous presentation of – bioweapon – facts on the ground over grandstanding rhetoric.

The return of Nord Stream 2

Deputy Permanent Representative to the UN Dmitry Polyaniskiy announced Russia’s demand for an open meeting of the UN Security Council to present further evidence related to U.S. biolabs in Ukraine. Even if the meeting would be vetoed by the U.S., the evidence will be entered by Russia on the UN records.

These developments provide an extra indication there’s absolutely no space left for diplomacy between Russia and the U.S./collective West, as Polyaniskiy himself suggested when commenting the possible accession of Ukraine to the EU: “The situation has changed after Mr. Borrell’s statement that ‘this war should be won on the battleground’ and after the fact that the European Union is the leader in deliveries of arms [to Ukraine].”

It gets worse. The next chapter is Finland’s drive to join NATO.

The Americans gamble that Finland – and Sweden – joining NATO will totally discredit Putin’s Operation Z as having accomplished next to nothing strategically: after all, in the near future, potential U.S. hypersonic missiles stationed in Finland and Sweden will be very close to Saint Petersburg and Moscow.

Meanwhile, Russian unmasking of the bioweapon racket will drive a toxic section of American political elites to turbo-charge their warmongering. It’s all following a carefully calculated script.

First, these bioweapon-supervising “elites” ordered the massive Kiev shelling of Donbas in early February. That forced the Kremlin’s hand, pushing it to launch Operation Z.

We should always remember that the ultimate goal in the U.S. plan of training Ukrainians for war since 2014 was to alienate Germany from Russia – as Germany de facto controls Euroland economically.

Imperial control of the oceans allows the Empire to strangle Germany at will into subservience by cutting them off from Russian energy – as the British did to Germany in WWII when Britannia ruled the waves. The Wehrmacht could not supply their mechanized army with fuel. Now, in theory, Germany and the EU will have to look to the seas – and total U.S. dependency – for their natural resources.

The remote-controlled Kiev regime dominated by SBU fanatics and Azov neo-Nazis is making it even harder – by shutting off all natural gas from Russia through Ukraine into Europe, reducing the flow by more than one third.

That translates as U.S.-enforced blackmail to force the EU to increase the Ukro-weaponizing against Russia. The practical consequences for Germany and the EU will be dire – in terms of shut down industries and cost of home heating and electrical power.

Russia, meanwhile, will rely on a bolstered Pipelineistan maze to China and East Asia as well as high-speed rail to transport all its natural resources.

Blowback against the Americans though is not off limits. Stranger things have happened. If gas transit to Europe via Ukraine is totally cut off, there are no alternatives. And that – assuming there are working IQs in Berlin – would open the way for a renegotiation on the future of Nord Stream 2.

As the head of the Energy Development Center Kirill Melnikov notes, “the Yamal-Europe gas pipeline is practically idle and one of the Nord Stream 2 lines is also ready for operation though the German regulator has not issued permission for its launch yet.”

That prompted Melnikov to a priceless comment: “If purchases remain the same, Germany will probably need to urgently allow the launch of one of the Nord Stream 2 lines in order to replace the Ukrainian transit route.”

No one ever lost money betting on the astonishing stupidity permeating EUrocrat decision levels. Even facing economic suicide, the EU is desperate to “abandon” Russian oil. Yet a full ban is impossible, because of energy-deprived Eastern Europe.

Every impartial energy analyst knows replacing Russian oil is D.O.A., for a number of reasons: the OPEC+ deal; the ghastly divide between Washington and Riyadh; the never-ending JCPOA renegotiation, where the Americans behave like headless chickens; and the crucial fact – beyond the understanding of EUrocrats – that European oil refineries are designed to use oil from the Urals.

So just when we thought we could enjoy the summer by watching Europe commit hara-kiri, it’s time to stock up on those Aperol Spritz. Get ready for a new hit series, season 1: Inside the American bioweapon racket.

الرئيس الأسد في طهران: الحلف القويّ يزداد قوّة

الجمعة 13 مايو 2022

المصدر: الميادين نت

جو غانم 

استراتيجيّات دمشق وطهران المشتركة، فقد تجاوزت بأشواط بعيدة هوامش العلاقات والمكاسب والمصالح السياسية.

الرئيس الأسد في طهران: الحلف القويّ يزداد قوّة

في الشكل السياسيّ العام، قد لا تُشكّل زيارة الرئيس السوريّ بشار الأسد إلى طهران، يوم الأحد 8 أيّار/مايو، مفاجأة لمتابعي الملفات السياسية في المنطقة والعلاقات بين البلدين الحليفين، حتى لو ابتعدت نحو 3 سنوات عن الزيارة السابقة، فهي تأتي ضمن الحراك السياسيّ البينيّ المتوقّع في أيّة لحظة، وذلك ربطاً بطبيعة العلاقات بين البلدين، وبتطورات المنطقة المرتبطة بكلّ تفاصيلها السياسية والعسكرية والاقتصادية بالعاصمتين اللتين شكّلتا محور الأحداث في المنطقة، ووجهة أهداف كلّ المشاريع الدولية للإقليم على مدى العقد الأخير على وجه الخصوص.

لكنْ، ومن جهة أخرى، إنّ هذه الزيارة بعيدة كلّ البعد، في الشكل والمضمون، عن كونها زيارة روتينيّة أو تواصلاً عاديّاً ودوريّاً بين قيادتي بلدين حليفين أو صديقين، فمعظم الحراك السياسيّ الإقليميّ والدوليّ الذي شهدته المنطقة في الأعوام الأخيرة، وما رافقه من تطورات اقتصادية مفتعلة أو قسريّة، وتحرّكات أو خطط وهجومات عسكريّة، كان يستهدف فكّ هذا الحلف المتين بين البلدين أو على الأقلّ إضعافه.

إن دمشق تحديداً تلقّت أكبر قدر من الاستهدافات والضغوطات والإغراءات التي تركّزت بمجملها على هذا البند – الإيرانيّ والمقاوم – الثابت في طريقة التعاطي معها منذ انتصار المقاومة الإسلامية في لبنان، واندحار العدو الصهيوني من الجنوب في العام 2000، ثم اجتياح العراق ودخول مشروع “الشرق الأوسط الجديد” حيز التنفيذ، حتى اللحظة.

تأتي زيارة الرئيس الأسد إلى طهران بعد أقلّ من شهرين على زيارته العاصمة الإماراتية أبو ظبيّ، والتي اعتبرها العديد من المحللين والمتابعين وقتذاك منعطفاً مفصليّاً في السياسة الدولية والإقليميّة حيال الشام، بعد 10 سنوات من محاولات تحطيم سوريا بكلّ السبل، وكسر إرادة دمشق الوطنيّة، وعزلها في أقصى زوايا الضعف السياسيّ والعسكريّ والاقتصادي، لترفع آخر راية بيضاء يمكنها نزعها من مزق خيمة المقاومة، بعد أنْ صبغ العالم الغربي وأدواته الداخلية والإقليمية خريطتها كلها بلون الدم الأحمر. 

لقد قيل الكثير عن زيارة الرئيس الأسد للإمارات، وما سيليها، وذهب البعض بعيداً في الحديث عن نجاح العمل الغربي – العربيّ بإحداث خرق على خطّ دمشق – طهران، متّكئين على تداعيات الحصار الخانق الذي تعانيه سوريا، وحاجتها إلى طوق نجاه يُبعد شبح الجوع المُخيّم على بيوت مواطنيها ومؤسساتها.

وهناك من تحدث عن تحقيق العرب المطبّعين مع العدو الإسرائيليّ نقاطاً جديدة تخدم مشروع العدو، على حساب مشروع المقاومة التي تقف دمشق وطهران على رأسه وفي قلبه.

وقد تحدّثنا حينذاك في “الميادين نت” عمّا أثبتته دمشق دائماً بأنّ كل تلك التحليلات والاستشرافات تثبت جهلاً بالسياسة السورية وثوابتها الوطنية والاستراتيجية، وتنمّ عن ضعف في قراءة حقيقة طبيعة العلاقات السورية – الإيرانيّة، واستسهال في دراسة النتائج والتحديثات الاستراتيجيّة المتتالية التي عمل ويعمل عليها محور المقاومة الممتد ميدانيّاً من طهران إلى أقصى الشمال والشرق السوريّيْن، مروراً باليمن والعراق ولبنان، وبمركزه فلسطين المحتلة.

لذلك كله، يأتي هذا التواصل السوري الإيرانيّ الجديد، وكل تصريح أو جملة وردت خلال هذه الزيارة على لسان الرئيس السوريّ بشار الأسد، والسيد علي خامنئي، والرئيس الإيراني إبراهيم رئيسي، لتعطي فرصة جديدة لمن يريد قراءة الحدث كما ينبغي، ولاستشراف مستقبل المنطقة انطلاقاً من إرادة “محور القدس” وخططه ومشاريعه لمنطقته وشعوبه، لا من زاوية المشاريع والخطط الأميركية والإسرائيلية للمنطقة، والتي تهاوت وتتهاوى تحت ضربات هجوم مضادّ على امتداد ساحات المقاومة في المنطقة وميادينها، وصولاً إلى ميدان الصراع العالميّ الأشمل حول العاصمة الأوكرانية كييف، وعلى مشارف الحدود مع حلف الناتو.

لقد أصرّ الرئيس الأسد بدايةً على تذكّر الشهيد قاسم سليماني، ودوره الكبير في النضال في مواجهة المشاريع الغربية في سوريا تحديداً، وفي المنطقة عموماً، ومحبته لسوريا ومحبة سوريا له، ودوره في ترتيب زيارة الرئيس الأسد إلى طهران قبل 3 سنواتٍ.

وحين يكون اسم اللواء قاسم سليماني، بكلّ ما يعنيه هذا الاسم لأهل المقاومة وأعدائها الذين استهدفوه شخصيّاً، فاتحة الحديث بين قادة البلدين، ويكون خلَفه اللواء إسماعيل قاآني الذي رتّب هذه الزيارة وحضر كل تفاصيلها، فهذا يعني أننا لسنا أمام لقاء روتينيّ وعاديّ لقادة سياسيين عاديين، بل أمام لقاء بين قادة ميدانيين يقاتلون كتفاً إلى كتف لبلوغ غايات استراتيجية كبيرة تتعدّى كلّ ما هو عاديّ وروتينيّ في العلاقات بين الدول.

نحن هنا، وبناءً على كلّ كلمة قيلت في هذه القمّة أو خبرٍ رشح عن كواليسها أمام لقاء بين قادة محور مقاومٍ يتحدّثون لغة واحدة، ويستهلّون كلامهم ويختمونه بالحديث عن المقاومة وحاضرها وجدواها ومستقبلها وطرق تصعيدها وحصد نتائجها، ويبحثون في السياسة من قلب هذا السياق تحديداً، وتبدو وحدة الحال بينهم أمتن وأقوى من أيّ وقت مضى، منطلقين من واقعٍ عمليّ واستراتيجيّ اشتغلوا عليه معاً لسنوات طويلة، وقدّموا فيه الكثير من الأثمان الباهظة والتضحيات النفيسة، ويرون أنّ نتائجه حتى اللحظة باهرة وعظيمة، وتستدعي ظروفه الراهنة لقاءً مثل هذا للتباحث والتشاور ووضع الخطط الاستراتيجية القادمة. 

إنّ فلسطين تشتعل تحت أقدام المحتلّ الذي يتخبّط تحت وقع عمليّات فدائيّة يعجز عن التعامل معها، كما يعجز عن القيام بردّ عسكريّ شامل ومدمّر كعادته في أزمان خلت على مدن فلسطين وقراها، حيث تهدّد قوى المقاومة الفلسطينية العدو بالويل والثبور إذا ما أقدم على ذلك أو على اغتيال أيّ قائد من قادة المقاومة، والعدو يعرف أنّ المقاومة جدّية وقادرة، وهي على قدر التهديدات هذه المرّة، ويعرف أنّ فصائل المقاومة الفلسطينية التي تُشكّل عصب هذا المحور، أذابت الكثير من الفروقات والتناقضات والخلافات لمصلحة الهدف الأسمى، كما يعلم أنّ هذا العمل استلزم جهد جميع أطراف محور المقاومة لبلوغه، وعلى رأسهم طهران ودمشق. كما أنّ الواقع الميدانيّ في سوريا واليمن والعراق، والسياسيّ – الانتخابيّ – في لبنان، يُظهر تقدّماً كبيراً وراسخاً لقوى محور المقاومة، مقابل عجز واضح للمحور المعادي وأدواته المحليّة.

وانطلاقاً من هذا كلّه، فإنّ حديث قادة المقاومة في سوريا وإيران خلال هذه الزيارة عن نظام عالميّ جديد هو حديث يصدر عمّن ساهم وشارك في صنع هذا النظام على مستوى الإقليم على الأقلّ، الأمر الذي ساعد كثيراً القوى الدولية الحليفة والصديقة، وعلى رأسها روسيا والصين، في السير باتّجاه المواجهة مع النظام العالمي الذي تقوده الولايات المتحدة، والسعي إلى إزاحته وإرساء نظام جديد.

لقد ساهمت دمشق وطهران وقوى محور المقاومة في المنطقة بشكل أساسيّ ومباشر وفاعل في كسر أخطر المشاريع الغربية والإسرائيلية لمنطقتنا في السنوات العشر الأخيرة وإفشالها، وها هو الرئيس السوريّ بشار الأسد يقف إلى جانب إخوة السلاح في طهران – بعد حديث عن لقاء جمعه بالسيد حسن نصر الله قبل الزيارة إلى طهران – ليعلنوا معاً تمتين هذا الحلف الاستراتيجي، ويبحثوا في سبل ترسيخه وتقدّمه على جميع المستويات، وخصوصاً الاقتصاديّة منها، وذلك بعد أنْ بلغ المستوى العسكريّ والأمني درجة كبيرة من الوضوح في التقدّم والأفضليّة.

 ولعلّ تدشين خطّ ائتمان إيراني جديد باتّجاه سوريا، بالتزامن مع الزيارة، لإمداد دمشق بموارد الطاقة اللازمة للفترة القادمة، أفضل مؤشّر على طريقة العمل الواثق الذي تنتهجه قيادة البلدين. 

من هنا تحديداً، يجب أن يعيد المهتمّون في الإقليم والعالم قراءة العلاقات الثنائية بين سوريا وإيران، قبل أيّ قراءة في تفاصيل النشاطات السياسية التي تضطرب وتعتمل في المنطقة، والتي تشتغل دمشق وطهران معاً على هوامشها المتاحة لتحقيق إنجازات سياسية واقتصاديّة مدروسة تماماً، ولا تخرج عن المصلحة العامة لاستراتيجية المحور، فيما قد تحقّق بعض الهدوء وربط النزاعات على عدة جبهات وميادين، قد يبدو أنّ المحور الآخر يستفيد منها مرحليّاً أو يحدّ من خسائره على الأقلّ. 

وحين يركّز قادة سوريا وإيران في أحاديثهم خلال هذه الزيارة على شعوب المنطقة العربية وموقفها من القضية الفلسطينية، والهوّة الساحقة بينها وبين قادتها وحكوماتها، وهو ما تجلّى في الاحتفال بيوم القدس العالميّ، فإنّ الرسالة تعني تماماً وتحديداً الثقة بقدرة أهل المقاومة وشعبها في المنطقة على عزل كيان الاحتلال الإسرائيليّ، ورهان قادة محور المقاومة الثابت على فشل كلّ محاولات التطبيع العربية مع هذا الكيان المؤقت، أو دمجه في المنطقة ككيان طبيعي ينتمي إلى جسم الإقليم. 

هذا الأمر تحديداً يُظهر موقف دمشق وطهران الدائم من التطبيع، ويضع حدّاً للتأويلات الجديدة والضعيفة التي برزت بعد زيارة الرئيس الأسد إلى الإمارات العربية المتحدة في آذار/مارس الماضي، وخصوصاً أنّ الرئيس الأسد أكّد في تصريح له خلال زيارته طهران أنّ مجريات الأحداث في المنطقة “أثبتت مجدّداً صواب الرؤى والنهج الذي سارت عليه سوريا وإيران منذ سنوات”، وخصوصاً في مواجهة الإرهاب والمشاريع الغربية للمنطقة. وغنيّ عن القول إنّ دمشق وطهران تصنّفان كيان الاحتلال قوّة إرهابية عالميّة مدمّرة، كما تصنّفان الجماعات الإرهابية المتطرفة أدوات لهذا الكيان وللغرب الراعي له.

من المفترض أن يكون كل تعويل خارجيّ أو إقليميّ على كسر حلف طهران – دمشق أو إضعافه قد سقط في هذه الزيارة، كذلك المراهنات على تداعيات الحصار الغربي لسوريا، والحديث عن محاولات عربيّة لإحداث خرقٍ من خلال الانفتاح على دمشق وتعويضها اقتصاديّاً وسياسيّاً، فالاستراتيجية الوطنية السورية تعمل على مسار آخر تماماً، بعيد كلّ البعد عن المقايضات السياسية والاقتصادية، وهي ترى أنّ أيّ انفتاح عربيّ أو دوليّ عليها فرضه صمودها وقتالها المرير على مدى 10 سنوات، وإلى جانبها الحليف والشريك الإيرانيّ، وباقي الحلفاء في محور المقاومة والعالم.

وقد كان تمتين الحلف الاستراتيجيّ بين البلدين وجميع قوى محور المقاومة الموضوعَ الرئيسيّ في هذا اللقاء، وجرى البحث في كلّ السبل الواجب اتّخاذها فوراً لتعزيز هذا الحلف، ولسدّ كلّ نقص اقتصاديّ على جبهاته الداخلية، فقد كان المسؤولون السوريون والإيرانيون يوقّعون اتفاقيات وتفاهمات اقتصادية جديدة، حين كان الرئيس الأسد يقول للمرشد الإيراني السيد علي خامئني والرئيس إبراهيم رئيسي: “إنّ ما يمنع الكيان الصهيونيّ من السيطرة على المنطقة هو العلاقات الاستراتيجية السورية الإيرانية”، وهو السياق الذي اتّبعه جميع المسؤولين في البلدين في تصريحاتهم أثناء الزيارة وبعدها.

ولعلّ قول وزير الخارجية الإيرانيّ السيد أمير عبد اللهيان بعد اللقاء إنّ “زيارة الرئيس الأسد فتحت مرحلة استراتيجيّة جديدة بين البلدين”، وحديثه عن “العزم الإيراني السوريّ على الرقيّ بالعلاقات الثنائية وصولاً إلى أفضل مستوى لائق”، يدلان بشكل واضح على النحو الذي ستجري فيه الأمور على هذا الصعيد في المرحلة القادمة. 

بعد زيارة الرئيس الأسد هذه لإيران، هناك زيارة لأمير قطر على رأس وفد رفيع إلى طهران، وذلك بعد وقت قصير من إعطاء واشنطن أمير قطر صفة “الحليف الاستراتيجيّ”، وفي هذا مؤشّر على أنّ طهران ودمشق استطاعتا وأد جميع الرهانات التي جرى العمل عليها طوال السنوات العشر الماضية، والتي كانت تهدف إلى إسقاطهما وهزيمتهما أو عزلهما تماماً على الأقلّ.

 ومن الواضح أنّ انتصارهما وتقدّم حليفيهما الروسيّ والصينيّ على الجبهات العسكرية والاقتصادية على مستوى العالم، يدفعان دول المنطقة إلى السّعي نحو تعزيز العلاقات معهما، باعتبارهما قوّتين لا يمكن تجاوزهما بعد الآن. 

أمّا استراتيجيّات دمشق وطهران المشتركة، فقد تجاوزت بأشواط بعيدة هوامش العلاقات والمكاسب والمصالح السياسية العادية بين الدول، وبلغت مرحلة العمل كقوّة واحدة مع الشركاء في قوى المقاومة في المنطقة، وها هي تلك الاستراتيجية تعمل بأقصى قوتها على أرض فلسطين المحتلة الآن، إذ تُكمل المقاومة الفلسطينية مهمّة رسم النظام الإقليميّ الجديد.

إن الآراء المذكورة في هذه المقالة لا تعبّر بالضرورة عن رأي الميادين وإنما تعبّر عن رأي صاحبها حصراً

(Updated with transcript) Ben Norton aka Multipolarista interviews Michael Hudson: Destiny of Civilization

May 12, 2022

Source

The decline of the US dollar, the three ‘systems’, the sanctions war on Russia, on the eve of the publication of Prof. Hudson’s new book:  The Destiny of Civilization: Finance Capitalism, Industrial Capitalism or Socialism.”

UPDATE:  This wonderful transcript is now available just underneath the video

Transcript

BENJAMIN NORTON: Hey, everyone. I’m Ben Norton, and this is the Multipolarista podcast. And I have the great pleasure of being joined today by one of my favorite guests, one of I think the most important economists in the world today. I’m speaking with Professor Michael Hudson.

If you’ve seen any of the interviews I’ve done with Professor Hudson over the past few years, you probably know that he’s a brilliant analyst. He always has, I think, the best analysis to understand what’s going on economically and also politically, geopolitically, in the world today.

And right now is, I think, a very important moment to have Professor Hudson on today. We’re going to talk about the economic war on Russia and the process of economic decoupling between Russia and China and the West, which is something that Professor Hudson has talked about for many years. And that really has accelerated with the Western sanctions on Russia over Ukraine.

We’re also going to talk about the decline in U.S. dollar hegemony. A recent report from the International Monetary Fund, which is dominated by the U.S., acknowledged that the use of the dollar in foreign bank reserves is gradually declining.

Now, it’s not going to disappear overnight. But even the IMF is acknowledging that dollar hegemony is eroding. And, of course, the IMF acknowledged that the Western sanctions on Russia are going to further erode the hegemony of the U.S. dollar.

We now see Russia doing business with China in the Chinese yuan. Russia is also doing business with India with the Indian rupee. And of course Russia has been telling Europe that if it wants to buy Russian energy, it has to do so with Russian rubles.

So there’s so much to talk about today, Professor Hudson, but I want to begin in the first half of this interview today talking about a new book that you’re just about to publish.

Today is Monday, May 9th. You said on Wednesday, May 11th, the book comes out. And it’s called “The Destiny of Civilization: Finance Capitalism, Industrial Capitalism or Socialism.”

And everything that I just prefaced this interview with, discussing the economic war in Russia and sanctions and decoupling, this is all deeply related to what you talk about in this book. And I had the pleasure of getting an early copy and reading through it. It’s a really important book, I think.

And you talk about this fundamental divide internationally – and this is a divide that actually goes back historically as well – between these three models for different economic systems you discuss: finance capitalism, industrial capitalism, and socialism.

And your argument is that the U.S. empire has been a force for imposing neoliberalism, which is a particular form of finance capitalism, which is nonproductive, in which finance capital destroys productive industries in pursuit of rent-seeking, and what you call the rentier class.

So instead of producing, as the classical bourgeois economists had said capitalism would be a productive system instead, finance capitalism is fundamentally a system of destruction and debt.

And your argument is that this is deeply rooted in U.S. foreign policy. This is the U.S. foreign policy strategy for expanding its economic power, is imposing this finance capitalist model on the world.

So can you expand further on your argument about the fight between finance capitalism, industrial capitalism, and socialism, and why you decided to publish this book now?

MICHAEL HUDSON: Well the book came out of a series of 10 lectures that I did for my Chinese audience. I’ve been a professor at Peking University for a number of years in economics, and have professorships at other universities, Wuhan and Hong Kong.

And I have a fairly large audience of about 65,000 people per lecture there. And I was asked to give my general overview, sort of a history of economic development in the West, for the Chinese.

And in order to understand today’s finance capitalism, you have to understand what industrial capitalism was, as it was described in the 19th century.

And it’s often forgotten, or played down, that industrial capitalism was revolutionary. What it was trying to do – from the physiocrats in France in the late 18th century to Adam Smith, John Stuart Mill, Marx, and the whole late-19th century flowering of socialism – the ideal of classical value theory and rent theory, was to say what is the actual value, the cost value of producing goods and services?

And what is earned by the capitalist, when he employs labor to make a profit, and what is unearned? And what is unearned was the landlord class. That was the hereditary warrior class that conquered all of the European kingdoms in the Middle Ages.

And the attempt by England’s industrialists was saying, look, we cannot become the workshop of the world; we cannot undersell foreign countries if we have a landlord class ripping off all of the money in land rent.

And if we have predatory banking, or the wealthy people just lend really for buying property, or making distressed loans or predatory loans that have nothing to do with financing actual capital formation.

Well, what made this capitalism revolutionary was the British industrialists and advocates of industry, even the bankers in Ricardo’s time, said, well, in order to overthrow the landlord class, which controls the House of Lords and all of the upper chambers of government in Europe, we have to have democratic reform.

If we have democratic reform and give voting to the people, they’re going to vote against the landlord class, and then we can have an efficient economy where our prices of our exports and our goods and services reflect the actual cost of production, not the rake off for the rentiers class, not the rake off of what landlords take, not the rake off of what predatory bankers take.

And the whole long 19th century leading up to World War One was this revolutionary value theory that depicted land rent and monopoly rent and financial returns as being unearned income and wanting to strip it away.

And all of this seemed to be moving toward socialism. The industrialists were all in favor of government public utilities, of government enterprise, because they said, if the government doesn’t provide health care, then individuals are going to have to pay it, and it’ll cost a lot of money, like it does in the United States.

And so you had the conservative prime minister of England, Benjamin Disraeli, saying, health, all is health, we’ve got to provide public health for the people.

And it was the conservative Bismarck in Germany that said, we’ve got to provide pensions. If labor has to save up for the pensions, then it’s not going to have enough money to buy the goods and services that we Germans are producing. We have got to make pensions public.

So all of this move towards socialism was not only in favor of increasing living standards, which soared in the 19th century, but also in freeing the economy from the rentier class, from the landlords, from the bankers.

And for the classical economists, a free market was a market free from landlords, free from bankers, free from monopolists.

Well, needless to say, the rentiers fought back. And by after World War Two, we’ve seen a continual anti-classical theory replacing the classical idea of free markets with a value of free theory, saying, well, everybody earns whatever they they have. All wealth is earned, not unearned. And if Goldman Sachs partners are paid more than anyone else, that’s because they’re so productive.

So you had a move rejecting classical economics, a junk economics, and a kind of artificial economics that doesn’t really talk about how finance capitalism has worked.

And as it turns out, the business plan of finance capitalism was so predatory that it was anti-industrial.

That’s why President Clinton in the United States moved to invite China into the International Labor Organization, saying, well, we can fight wage rises in America by a race to the bottom. We can we can hire Asians to do work, and that will cause unemployment here. And that’s wonderful for the industrialists. It will basically cut wages and keep American wages down.

Well, that basically is the strategy of finance capitalism, and the aim of finance capitalism is not to invest in factories, and plant equipment, and research and development, but to live in the short term, but to make money by financial engineering, not industrial engineering.

And it becomes predatory, and so you have the whole ideological attack on public enterprise. You have Frederick Hayek’s “The Road to Serfdom,” where you say, if government provides public healthcare, that’s “the road to serfdom,” where actually it’s finance capitalism that is the road to debt peonage and serfdom.

And you have now a whole disparagement of government. And all of this is a counter-revolution to the revolutionary impetus of industrial capitalism in its early stages.

And it’s true that corporations now are just as right-wing as the the banks and the hedge funds. But that’s because corporate industry has been taken over by the financial sector, and the heads of almost every industrial corporation are rewarded the how high they can push the stock price, to exercise the stock options they’re paid in.

And you increase the stock price not by investing more, not by hiring more labor or increasing productivity or increasing sales, but simply by using whatever income you have to buy back your stocks. And by buying back your stocks, this forces up their price.

And, most of all, by giving political contributions in this country to the Democrats and Republicans alike, who appoint Federal Reserve heads that have spent $7-9 trillion buying up stocks and bonds to increase the price of buying a retirement income, to increase Wall Street prices, to increase housing prices, and make America even less competitive industrially.

So finance capitalism is what has essentially de-industrialized the United States and turned the Midwest into a Rust Belt.

Well, the alternative, obviously, are the societies that have not followed this neoliberal finance capitalist plan. And the most successful economy, obviously, has been China, which is why it has been spending so much time there.

And China has done exactly what 19th-century United States, Germany, England, and France did. It has kept basic utilities, basic needs, housing, and above all, finance and banking, in the public domain, as public utilities.

Instead of having an independent financial sector operating on its own self-interest, the Bank of China creates the money. And the Bank of China lends money by deciding, where do we need to have investment in real estate to provide housing for the population at as low a price as we can make it? How do we build up the industry? How do we provide an educational system with training? How do we provide health?

And the fact is that the central planning in an efficient socialist style, not the Stalinist planning that everybody refers to of Russia, but a mixed economy as you have in China, which is truly a mixed economy, with guidance, like the French planification.

Well, that is obviously the way in which you survive and you avoid the kind of overloading the economy with debt service, with high rents, with high payments to the health-care monopoly in the United States, by avoiding all of this payment to a rentier class that has what the classical economists call unearned income, predatory income.

And instead of unseating them, we’ve put them in charge, and made the banks and Wall Street, and the city of London, and the Paris Bourse, the central planners.

So we do have central planning much more centralized than anything that was dreamed by the socialists. But the planning, the centralized planning is done by the financial sector.

And financial planning is short-termism; it’s short-term planning; it’s take your money and run. And that’s what is stripping and impoverishing the global economy today.

BENJAMIN NORTON: Absolutely. And, in your book, you write about the important distinction between the classical economic idea of a so-called free market, and how, you argue that, neoliberals turn that idea on its head.

So this is what you write in your book. And this is, again, Michael Hudson’s new book, “The Destiny of Civilization,” which is out this week. You write:

“The neoliberal ideology inverts the classical idea of a free market from one that is free from economic rent to one that is free for the rentier classes” – that is the rent-extracting classes – “to extract rent and gain dominance.”

So they they completely flip the idea of what it means to have a free market.

And then you note that, “in contrast to classical political economy, this neoliberal ideology promotes tax favoritism for rentiers, privatization, financialization, and deregulation.” And you discuss all of that.

That is, of course, what we could call the Washington consensus.

And then you argue that “U.S. foreign policy seeks to extend this neoliberal rentier program throughout the world.”

And you have a very interesting section of your book where you discuss this concept as “free-trade imperialism.”

So can you talk about what your idea of “free-trade imperialism” is and how it relates to U.S. foreign policy?

MICHAEL HUDSON: Well, the Nobel Prize is given basically for junk economics. And probably the worst junk economist of the century was Paul Samuelson.

He made the absurd claim that he proved mathematically that, if you have free trade then, and don’t have tariffs, and don’t have any government protection, then everyone will become more equal. At least the proportions between labor and capital will be more equal. Well, the reality is just the opposite.

And the term “free-trade imperialism” was actually created by a British historian of trade theory who pointed out that, wait a minute, when England went for free trade, the idea was, if we have free trade, we can stifle other countries from being able to industrialize, because if we have free trade, then we can tell America, we will open our doors to your markets – meaning the markets of the slave South, that Britain supported – and in exchange, you will open your markets to our industrial goods.

And America followed that until the Civil War, which was fought not only over slavery, but by the Republican Party after 1853 that said very explicitly, if we’re going to win the election – the Whigs never could win – if we, the new party, are going to win the election and industrialize America, we’ve got to integrate ourselves with the anti-slavery issue, with emancipation, but for us, the economic war of America is a war of, either we’re going to have protective tariffs in the North, or we’re going to end up as a non-industrial, raw materials-producing society, as the South wants.

And that was the debate from 1815, when the Napoleonic wars ended and world trade began again, until really the Civil War.

And America became strong in the way that Germany became strong too, by having protective tariffs, in order to have prices large enough to nurture what was called infant industry, to nurture American manufacturing.

And I wrote a long book about this, published some years ago based on my PhD dissertation, “America’s Protectionist Takeoff.”

Well, the English tried to fight against other countries protecting their economy, saying that if you just have free trade, you’ll get rich. Whereas the reality is, if we have free trade, you’ll get poor, if you’re not already able to have industrial and labor productivity and agricultural productivity on par with the most advanced countries.

Free trade was an attempt to prevent other countries from investing government money and building up their agriculture, and building up their industry, and building up their productivity, and creating a school system, to raise wages, to make wages more productive.

And the American protectionists said, well, we’re going to have a high-wage economy because high-wage labor undersells pauper labor. And skilled, well-fed, well-rested American labor can produce much more than the pauper labor of other countries that have free trade.

Well, what the leading American protectionist economist, Erasmus Peshine Smith, went to Japan and helped industrial help Japan break away from British free trade, helped Japan industrialize.

And other American economists, other foreign economists, all picked up the ideas of the American protectionist, like Friedrich List went to Germany promoting protectionism.

And Peshine Smith’s book, “The Manual of Political Economy,” was translated into all the foreign languages – Japanese, Italian, French, German.

And you had Europe realizing that free trade polarizes economies. Well, it was this that after World War One, and especially World War Two, when you had orthodox economics turning into basically propaganda.

That’s where you and Samuelson and others try to convince other countries, governments are bad, leave everything to the wealthy people, to the finance people, trickle-down economies, it’s all going to trickle down, don’t worry, just give more money to the rich, and don’t have any government interference with markets.

Whereas America had got rich by interfering with markets, to shape them in the years leading up to World War One.

But after World War One, America had already achieved its industrial dominance. And it was after World War One that America said, ok, now our protective tariffs have enabled us to outproduce all the other countries, and our protectionist agriculture especially – the most protected sector in America, has always been agriculture, since the 1930s.

Basically it said, well, now we can outproduce other countries, we can undersell them, now we can tell them to go for free trade.

And after World War Two, the Americans created the World Bank for economic impoverishment, and the International Monetary Austerity Fund.

And the World Bank’s leading objective was to prevent other countries from investing in their own food production.

The guiding line of the World Bank was, we’ve got to provide infrastructure for building up plantation agriculture in Latin America, and Africa, and other countries, so that they will grow tropical export crops, but they cannot be permitted to grow grain or wheat to feed themselves; they must be dependent on the United States.

And so the function of free trade, the World Bank, and the International Monetary Fund has been to finance dependency, backed up by the American support of dictatorships throughout Latin America who agree to have client oligarchies supporting pro-American trade patterns and avoiding any kind of self-reliance, so that the United States can do what it has recently done to Russia and other countries, impose sanctions – say, well, now that you depended on us for your grain, we can now impose sanctions, and you can’t feed yourself if you don’t follow the policies we want.

That was the policy that America tried to use against China after Mao’s revolution. And fortunately for China, Canada broke that monopoly, and said, well, we’re going to sell grain to China. And China was always very friendly to Canada in those earlier decades.

So basically, free trade means no government, no socialism. It means central planning essentially by Wall Street – countries should let American firms come in, buy control of their raw materials, resources, control of their oil and gas, and mineral rights, and forests and plantations, and basically let other countries send their whole economic surplus to the United States, where it will be duly financialized to buy out other countries’ raw materials and rent yielding resources.

BENJAMIN NORTON: Yeah, and in your book, you have a very funny passage that I think really encapsulates this ideology that you’re talking about here.

You referred to Charles Wilson, who was the secretary of defense under Eisenhower in the U.S., and he was also the former CEO of General Motors.

And he famously said, “What’s good for General Motors is good for the country.” And that idea has morphed into the idea that, “What’s good for Wall Street is good for America.”

And then you note that “this merged with evangelistic U.S. foreign policy that says ‘What’s good for America is good for the world.’ And therefore the logical syllogism is clear: ‘What’s good for Wall Street is good for the world.’”

And you describe this, you link it to the new cold war, this idea that what’s good for the U.S. is good for the world and what’s good for Wall Street is good for the U.S., therefore, what’s good for Wall Street is good for the world.

You argue, “We must recognize how finance capitalism has gained power over industrial economies, above all in the United States, from which it seeks to project itself globally, led by the financialized U.S. economy. Today’s new Cold War is a fight to impose rentier-based finance capitalism on the entire world.”

And this is such an important analysis. Because among those very few people of us who talk about this idea of the new cold war and how dangerous it is, there are very few people who frame it in economic terms.

Usually we frame it in political terms, right, the geopolitical interests between the US and the EU on one side, and China and Russia on the other.

And going back to Brzezinski and The Grand Chessboard, his 1997 book, where he talks about the importance of preventing near strategic competitors from emerging in Eurasia. That’s of course a geopolitical discussion and economics is part of it, but it’s often not at the forefront.

But your analysis I think is even more important, and more accurate, because your argument is not only is it geopolitical, but the geopolitical struggle is rooted in economics. And this is an economic struggle between systems.

So talk talk more about the new cold war and how you see it.

MICHAEL HUDSON: Well, as we’re seeing now, the world is dividing into two parts. We can see that in the fight against Russia, which is also a fight against China, and against India, as you noted. And it seems Indonesia and other countries as well.

The United States is pushing a world that can be controlled by American investors. The ideal of the American neoliberal plan is to do to other countries what it did to Russia after 1991: take all of your public domain, your oil companies, your nickel mines, your electric utilities, give them all to the wealthy oligarchy, that can only make money once it’s taken control of these companies, by selling the stocks to the West.

The West will buy out oil, just like Mikhail Khodorkovsky tried to sell Yukos oil to Standard Oil in the West. And we’ve got to put an oligarchy that will sell all of the national domain, all of the patrimony and natural resources, and all the companies, to American investors on the cheap.

The Russian stock market led all the stock markets in the world from 1994 up to about 1998. This was a huge rip off. The United States wants to be able to do that to the rest of the world.

And it was furious when Russia said, we’ve lost more population as a result of neoliberalism than we did in all of World War Two fighting against Nazism. We’ve got to stop.

And Russia began to say, we’ve got to use Russia’s population, and industry, and natural resources for Russia’s benefit, not for the United States’ benefit.

Well, the United States was absolutely furious with this. And the fury has erupted in the NATO war against Russia in the last few months, and what’s ongoing now.

And the United States says, U.S. State Department officials have said, what we want to do is carve up Russia into maybe four different countries: Siberia, western Russia, southern Russia or Central Asia, maybe northern Russia.

And once we’ve done that, we cut Russia off from China, then we go into China. We finance, we send ISIS and al-Qaeda into the Uyghur areas, the Muslim areas, and we start a color revolution there. And then we break up China, into a northern part, a southern part, a central part.

And once we break them up, we can more or less control them. And we can then come in, buy up their resources, and take over their industry, their labor, and their government, and get richer to obtain from China, Russia, India, Indonesia, and Iran the wealth that we’re no longer producing in the United States, now that we de-industrialized.

So the world is dividing into two parts. And it’s not simply the United States and its European satellites on the one hand versus the non-white population on the other hand; it’s finance capitalism versus the rest of the world, which is protecting itself by socialism, which in many ways fulfills what was the ideal of industrial capitalism during the 19th century, when industrial capitalism was actually progressive.

And it was progressive. That’s part of the whole theme of my book. It was revolutionary. It tried to free economies from the legacy of feudalism, from the legacy of hereditary landlords.

And now the financial class is no longer the landlord class, but the landlord class pays most of its rent to the financial class in the form of mortgage interest, as it borrows money to buy property and housing and commercial sites on credit.

And you have the kind of financialization that has increased housing prices in the United States to over 40% of income, that is officially guaranteed for mortgages. That has priced American labor out of the market.

Privatized health care, 18% of GDP, that is pricing America out of the world market. Debt, auto debt, student debt, which in other countries education is free; that’s pricing America out of the market.

So you have a basically un-competitive economy that’s committing financial suicide, following the same dynamic that destroyed the Roman empire, where a predatory oligarchy took over and maintained power by an assassination policy of its critics, just very similar to what America has been doing in Latin America and other countries.

So you’re having history repeat itself with this same kind of world split. And this split couldn’t have occurred back in the 1970s, with the Bandung Conference in Indonesia. There were other attempts by the Non-Aligned nations to break free of American imperialism, but they didn’t have a critical mass.

So right now, for the first time, you have a critical mass. And you have the ability of China, Iran, Russia, India, other countries together to be self-sufficient. They don’t need relations with the United States.

They can handle their own; they can create their own monetary system outside of the International Monetary Fund, which is basically an arm of the Defense Department. They can give loans to build up the infrastructure of countries outside of the World Bank, which is basically an arm of the Defense Department, the deep state.

So you have the American economy – essentially a merger between the military-industrial complex and the Wall Street FIRE sector, finance, insurance, and real estate – really cannot develop any more than the Roman Empire could develop, by trying to obtain militarily what it could not produce at home anymore.

Well, China and other countries, now that they have their industrial base, the raw materials, the food, the ability to feed themselves, the agriculture, and the technology, they can go their own way.

And so we’re seeing in the last few months the beginning of a war that is going to go on for, I think, 20 years, maybe 30 or 40 years. The world is splitting away.

And it won’t be a pretty sight, because the United States and its European satellites are trying to fight to prevent an inevitable break away they cannot prevent, any more than Europe’s landlord class could prevent industrial capitalism from developing in the 19th century.

BENJAMIN NORTON: Yeah, and this is a good segue to what I wanted to ask you about, Professor Hudson, which is the economic war on Russia.

And I should say, of course, that today is May 9th. Today is Victory Day in Russia, celebrating the Soviet Union’s victory over Nazi Germany in World War Two. Not the US and British victory over Nazi Germany, the Soviet victory, in which 27 million Soviets died.

And actually I should say that, here on YouTube, in the comment section, there are some Russians who are your fans, Professor Hudson, saying they’re thanking you for your cogent analysis of Russia.

But on the subject of Russia, Professor Hudson, we now have seen that since Russia’s military intervention in Ukraine on February 24th, we saw really what could be referred to as financial shock-and-awe. That’s a term that’s been used.

Just as when the U.S. invaded Iraq, it waged a military shock-and-awe campaign on Iraq. Well, now it is waging economic or financial shock-and-awe on Russia.

And Russia has been referred to as the most heavily sanctioned country in history. Which I think is probably accurate, although maybe the DPRK, maybe North Korea, is more sanctioned. But I mean we’re talking about levels of sanctions not seen against a country of this size ever.

And you can also refer to it as the contemporary equivalent of medieval siege warfare against Russia.

Joe Biden, in a speech in Poland, made it clear what Washington’s goal is: it’s regime change. The U.S. wants to overthrow the Russian government, as it did in the Soviet Union in 1991, and clearly install a a pliant alcoholic neoliberal puppet like Boris Yeltsin.

So can you talk about, from an economic perspective, what do you see as the effects of this economic war on Russia?

And specifically in terms of the concept of decoupling, which you have talked about for years, and you have said that the Western sanctions on Russia and China were accelerating that process of decoupling. And this was before the financial shock-and-awe we’ve seen.

So you talked about a move away from this neoliberal globalization where everything is interconnected, or at least capital is interconnected globally, to the creation of a kind of, what you could say is kind of an economic iron curtain.

But how do you see that also in terms of integrating the Eurasian economies more deeply?

And also what is the effect on the European economies, which my impression is that Europe is going to become what you call an economic dead zone, more and more reliant on the U.S., whereas Russia, China, and Iran, and even potentially India, Pakistan, Bangladesh, Indonesia – we’re seeing much more economic integration of Asia, which is, of course, where the majority of humanity lives.

MICHAEL HUDSON: Well you have used the words shock-and-awe, picking it up from the U.S. statements of shock-and-awe. There hasn’t been any shock-and-awe; there’s been a self-defeating piffle, and laughter.

That’s not all. There was an attempt to grab $300 billion of Russia’s foreign reserves, saying, well, any country that leaves their reserves in American banks or in the American Monetary Fund to stabilize their currency, we can grab if we don’t like their policy.

So the idea was, now Russia is going to go broke. It can’t afford to buy anything without U.S. dollars. And the people are going to get so angry, they’re going to vote against Putin. And then we can pour in our money to twerps like Navalny and other right-wingers who have promised to be the new Yeltsins.

Well, it didn’t work that way. They did grab the $300 billion of Russia’s reserves. Russia immediately said, ok, we have our own money. We now, fortunately, have enough oil and gas that we don’t have to sell to Europe and Germany. If they want to freeze in the dark and let their pipes burst when the weather gets cold, that’s their problem. We’ll sell to India, and China, and other countries.

And there was, for a few days, the ruble plunged, by saying, uh oh, what is Russia going to do? So all the foreign exchange traders thought, you can trust Biden to have a really brilliant policies.

I think Paul Krugman, the Nobel Prize winner, said Biden is the greatest American president since Roosevelt, or since Truman, that he was so smart. Well, that’s why Krugman got the Nobel Prize, for making statements like that.

So immediately Russia said, well, obviously we can’t get paid in dollars anymore, or in euros, because, you’ll just grab them, so you’ll have to buy oil and gas in rubles. We’re going to price it in our own currency. Just like China had talked about pricing its exports in yuan.

And so what has happened is that immediately the ruble not only recovered, but is now selling at a higher rate than it was before the American sanctions. So there was no shock at all. The Americans felt shock.

The Americans are shocked. The Americans are awed. The Russians are laughing and everything is going their way.

So it’s almost as if – I would not accuse Biden of being on the pay of Russia, and I would not say that the leaders of Congress are the Russian agents, but if they were Russian agents, if they were paid by Russia, they could not have done a better job of helping Russia catalyzing its protectionism that it wouldn’t do itself.

The fact is that President Putin and many of the people around him still were neoliberals. I mean, they began as neoliberals, in the ’90s.

They began by hoping that they could make an arrangement with Germany and Europe, that Europe would develop their industry and make Russia as efficient an economy as Germany or the United States. Well, obviously that hasn’t happened.

All the same, they didn’t think of imposing protective tariffs as the United States did. They didn’t protect their agriculture. They bought grain, and cheese, and other agricultural products from the Baltics, and from other countries.

Well, now that, once the Americans put on the sanctions, beginning already under the Trump administration, all of a sudden Russia had to produce its own food.

And it did. It made the investment. It is now the largest agricultural exporter in the world, not a food-deficit country. It’s not importing any more cheese from Lithuania and the Baltics. It has its own cheese segment.

And the sanctions are forcing Russia to do exactly what the United States, Germany, and other protectionist countries did in the 19th century, developing their own industry by isolating it from low-priced foreign imports that would be priced so low that the Russians otherwise could not afford to make the investment in factories, plants, equipment, research, and development.

So what the United States has done is actually catalyze Russia moving together.

And also, for three or four years, I have been talking with Russians, and with the Chinese, and other countries about the need to de-dollarize. If you want to develop your own economy, you have to develop your economy in your own interest with public spending and planning, independent from the United States.

Well, now everybody thought that, well, in a few years it may take a decade for China, Russia, Iran, all these countries to break away from the U.S. But America said, we’re going to help you, we’re going to speed up the breakaway process. We’re going to isolate you. So you’ve got to band together against us.

So that’s exactly what it has done. You can just imagine how the Russians are crying all the way to the bank about this.

And how China is watching what the Americans are doing to Russia, and listening to President Biden saying, you know, Russia is not our real enemy, our real enemy of China. And when we’re finished with Russia, then we’re going to go against China and do the same thing to it.

Well you can imagine what this is leading the Chinese government to try to plan to be sufficiently independent from the United States, so that similar type sanctions will not hurt it.

And President Xi in the last few weeks has said we’ve got to make China as independent as possible. We’ve got to make our own computer chips. We’ve got to not depend on the United States for anything, except maybe Walt Disney movies. That’s basically about it.

So it’s as if – you know, I had mentioned earlier that finance lives in the short term. American policy, being financial policy, lives in the short term. And it’s looking at if it can make a quick, a quick victory, and forget about what’s going to happen next.

I’m told that, years ago, already from the war with Iran, and then Iraq and Syria, in the State Department, if there were Arab specialists who spoke Arabic, they were all fired. Because they said, well, if you can speak Arabic, you must’ve learned Arabic because you’re sympathetic with them. You’re fired. We won’t have anyone who can read Arabic here.

Well, now in the last decade or so, they fired all the Russia specialists from the the State Department and CIA, saying, well, if you can read Russian, why would you want to learn Russian? You must like something in Russia. You wanted to learn it. You’re fired.

So they have people who have no idea of what’s happening in Russia, no idea what’s happening in these other countries. And they’re blinded by their ideology.

And if anyone would say, wait a minute now, public planning and making education a public utility is actually making them more competitive, well, that’s against the ideology. That’s not the corporate type.

And they’re taught, well, we really can’t trust people, maybe they’re tending toward socialism, and they’re out the door.

So you’re having American policy pretty much run by the blind, and the Europeans are simply taking orders, and money in little white envelopes from the United States, to just show their loyalty, and basically are willing to spend three to seven times as much for their energy, for their liquefied natural gas and oil, by buying from the United States, than they are by a long-term contract with Russia.

Europe is willing to spend now $5 trillion on putting together ports that can handle shipping tankers for liquefied natural gas instead of relying on the Russian pipeline, the Nord Stream Two, that’s already there.

So Europe is making an enormous sacrifice. If it doesn’t have Russian gas, and it refuses to pay rubles, it says, if you don’t give us our gas and oil for free, you’re attacking us, because we’ve been getting all of your oil and gas for free, because all the dollars, all the money we pay, you’ve recycled to the United States in your foreign reserves. Thank heavens, the U.S. can grab it all. If you don’t continue to give it to us for free, then you’re attacking us.

To the United States, other countries protecting their economy, other countries trying to raise their living standards, and especially other countries undertaking land reform, are viewed as enemies of the United States, because they’re an enemy of the neoliberal American financial system.

And the idea of the unipolar world where the United States gets all of the profits, and rents, and interests of the world economy, just as ancient Rome stripped its provinces by getting all of their wealth and income for themselves, not producing it at home, while impoverishing their own domestic population. It’s just an exact parallel.

So Europe is willing to say, well, ok, if we don’t have a Russian gas, well, that means that our chemical companies cannot buy the gas to make the fertilizer to make our crops grow, and our agricultural productivity is going to fall by about 50%.

We’re also going to spend a lot more money on America’s military, NATO arms to support NATO. So higher food, higher military spending, higher energy costs.

This ends Europe as an industrial rival to Asia, and Eurasia, I should say, because now the Chinese Belt and Road Initiative and other spending investment, capital investment, throughout Western Asia is creating a new productive plant that is not only self-sufficient, but is leaving the United States and Europe without any industrial competitive power. They’ve priced themselves out of the world market. They’re no longer competitive.

So the world is developing. And I’m sure the only way that the NATO countries can fight against it is militarily, by threatening to bomb. But they can’t fight economically. They can’t fight financially. They tried by disconnecting Russia from the SWIFT system. It put it in its own system very quickly.

It really is left without a strategy, except that it’s done a wonderful job of controlling the public relations dimension of this war, making it appear as if somehow other countries are the aggressors, in not letting America exploit them, and making it appear as if Russia is the aggressor in Ukraine, instead of NATO prodding and prodding Russia to say, we’re going to capture your port at Crimea, and we’re going to attack the Russian-speakers if you don’t fight back, and we’re going to keep bombing them year after year, from 2014 on, we’re going to keep bombing them until you protect them.

So all of this is treated as if America is purely defending itself. Well, this is what the Nazis said in World War Two. Hitler and Goebbels said, we can always mobilize a population to support our war by saying it’s a war to defend ourselves.

And that’s how the United States in Europe are doing it. Not only are they pulling a strategy out of Goebbels’ Nazi book, but a few weeks ago, Germany went to the museums, the military museums, where they had the old Panzer tanks from World War Two, and they sent the Panzer tanks, the Nazi tanks from World War II, to Ukraine, saying this is symbolic, now we can fight Russia with the same German Nazi tanks run by the neo-Nazi groups, that Zelensky is supporting, the same Nazi fight against Russia. We can reenact World War Two with the same tanks, even symbolically, to show that this is a fight of Naziism, and neoliberalism, against Eurasia.

BENJAMIN NORTON: We’ve also seen Germany not only re-militarizing, but also boosting its relations with Japan. There are some terrifying echoes of of World War Two.

But you mentioned something that I want to analyze a little bit more, which is the strength of the Russian ruble. I talked about the concept of financial shock-and-awe that was waged on Russia. And President Biden said, “the Russian ruble has become rubble,” he joked. He said the Russian ruble has become rubble.

Well, that’s actually not at all what happened. This is the value of the dollar to Russian rubles, right now [showing a graph]. Russian rubles are at 69 to the dollar. A few days ago, it was at 64, or 65 to the dollar, which is actually better than it was even before the Russian war in Ukraine, which began in February 24th.

And it did spike, and there was a peak here, at which it was devalued to 139 to the dollar, about half the value it has now. But in the months leading up to the Russian military intervention, in November and December, it was around 75 to the dollar.

So the ruble has actually strengthened despite these sanctions. And here’s a report from Reuters from five days ago, that was May 4th: the “Rouble leaps to over 2-year high vs dollar, euro as EU ups sanctions.” So the ruble is doing quite well.

And you talked about the Russian mechanism to force Europe to buy energy exports from Russia in the Russian ruble. And this graphic here, for people watching, it’s in Russian, but really it just shows this mechanism in which a European firm that wants to buy gas from Russia’s state owned gas giant Gazprom, it has to send the money in euros to the Gazprombank, which is the obviously the bank that works with Gazprom, and then it puts it in a special account in euros, and then that is sold in the Moscow exchange for Russian rubles.

And then those rubles are put in another special account, called a K account, that belongs to that European firm. It has two accounts, two special accounts with Gazprombank, one in euros, one in rubles. And then this special ruble account sends that money to Gazprom. And then once the money reaches Gazprom, that’s when Russia considers that the payment officially went through.

So this is the mechanism by which Russia is getting paid in rubles. And much of Europe claimed at first that they would not do so, but eventually they gave in. So that’s an incredible development.

And related to that, what I wanted to ask you about, is I think another reason that the Russian ruble has strengthened and stabilized is not only because Russia continues to maintain constant exports of energy to Europe and other parts of the world.

You can talk about the central bank policies. But one of the policies is that the Russian central bank has basically put the ruble on gold, which I think is a very interesting and historic development.

And we saw that from the beginning of April until the end of June, the Bank of Russia says that it’s going to buy gold at a fixed price of 5000 rubles per gram of gold. And then the question is whether or not in July, when this policy ends, if it’s going to continue, and if the ruble will basically become fixed, it become pegged to gold like the U.S. dollar was up until 1971.

So you don’t think it will be? So talk about this policy. Do you think that that the gold standard is going to come back? Or apparently you don’t think so.

MICHAEL HUDSON: No, Russia is not going on on the gold standard. What it is doing is investing, its foreign exchange in the only way that is not grabbable. It’s investing it in gold; it’s putting gold in its reserves.

It is not setting its exchange rate according to the price of gold, but it is buying gold with what it has been getting.

I want to go back to your talk about rubble. You talked about, “from ruble to rubble,” what President Biden said.

There have been a lot of pictures of rubble in the news for the last few days. For instance, there are talks of, here’s a Ukrainian picture, and look at this picture of a Russian tank, we shot it down, it’s rubble. Turns out it’s a Ukrainian tank, that they just say it was the Russian tank we shot down.

So basically, they’re taking their own destruction, and they’re saying that, while they’re being destroyed, they’re saying, no, this is a picture of Russia being destroyed, Russian assets, not Ukrainian assets being destroyed.

Well, the similar thing is with the Russian ruble. America says, look, we’ve isolated the the ruble. Well, what has happened? If you isolate the ruble and you say we’re not going to export anything more to Russia, so it’s not going to be able to spend any of its rubles on buying American or European products.

Well, meanwhile, Russia can continue to earn rubles from Germany and Europe, and it can continue to earn foreign exchange from other countries that it’s selling its agriculture to at rising prices, its oil and gas at rising prices, too. So obviously, the balance of payments is going way up.

And they believe that what is in store is a new monetary system that is an alternative to the dollar IMF system.

And in this system other countries will hold their reserves in each other’s currencies. In other words, Russia will hold Indian rupees and Chinese yuan. China will hold rupees and Russian rubles.

There will be the equivalent of what Keynes thought of as something like artificial special drawing rights that the banks will be able to create to help fund governments to undertake capital investment.

But for settlements settling balance of payments deficits among countries, once they don’t have enough foreign exchange to make a swap, they will use gold as the means of settlement, because gold is a pure asset. It’s not a liability.

Any foreign currency basically is held in a foreign country that has the power to do what America did to Russia and just grab it all, and say, we’re just wiping it all out.

It’s as if you have a bank account, and the bank says, we’ve just emptied out your account to give it to one of our friends, and you don’t have it anymore. You can’t do that if gold is held in your own country.

Venezuela made the problem of keeping its gold in England, trusting England, saying that, even if there is war, they’ll never interrupt gold and finance. And England just grabbed Venezuela’s gold.

So, obviously, countries are not going to leave their gold in other countries. Even little Germany has asked America to begin sending back the gold that it has in the Federal Reserve Bank of America because it’s worried that what if it ever buys Russian gas again? America will grab all of Germany’s gold, grab all the German money, and it’ll be like World War One all over again.

So this act that America did of grabbing Russian money, Afghanistan’s foreign reserves it grabbed, this is telling all the other countries, pull all your money out of dollars. What are they going to put it in? There’s not that much they can put it in that it is absolutely safe.

So gold is a flight to safety today, because it’s one of the things that all of the world realizes as having an international value for settling balance of payments deficits, that is independent of world politics.

So that’s the explanation. Russia is not going on gold. It’s going on an independent standard from the United States with gold as an element of its foreign reserve, just as it’s holding Chinese yuan and Indian rupees.

It’s not going on the rupee standard. It’s not going on the yuan standard. And it’s not going on the gold standard. But these are elements of its foreign reserves.

BENJAMIN NORTON: I have a question for you. It’s kind of a more technical question that I’ve always wondered. And I’ve tried to do research on this, because there’s not much information.

So we know that that the U.S. and European Union have frozen over $300 billion from Russia’s central bank foreign exchange reserves. And of course they did this after doing the same to Iran, to Venezuela, to Afghanistan, which is now threatening a famine in Afghanistan that could kill more people than died in the 20-year NATO-U.S. military occupation of Afghanistan, which is another topic that really needs to get more coverage.

And I should add, by the way, that the US and the EU, they’ve frozen nearly half of Russia’s central bank’s foreign exchange reserves, and are now saying they’re not going to give it back. So they stole it. I mean, they stole half of its reserves.

My question is, what is the mechanism by which they effectively freeze and steal those reserves?

Because my understanding is that there is of course a physical element of those reserves, which you’re talking about, which is gold. But not all of the $640 billion in Russia’s central bank reserves is physical currency, right? A lot of it is just computerized? It’s number in computers and bank accounts.

So when when the U.S. and the EU steal this money from central banks like in Russia or Afghanistan – obviously in the case of Venezuela, as you mentioned, they physically stole the gold. But if it’s not gold, is it physical cash stored in Moscow, like physical dollars and euros? Or it’s mostly just numbers in a computer, which is why they can steal it?

MICHAEL HUDSON: Every country needs to manage its exchange rates, and there’s always like an up-and-down and a zigzag in the flow of payments for imports and exports, investment, capital movements, debt service, all of that.

So countries want to stabilize their exchange rate. How do they do that? Well, most of the big exchange markets are in New York and in London.

So countries would leave their money in correspondent banks. Like when Iran, at the time under the shah, kept that foreign reserve in the Chase Manhattan Bank. So when Iran, after the revolution and Khomeini came in, and Iran wanted to pay interest on the foreign debt that the shah had run up, they told Chase, please, here’s our bondholders, please pay them.

Well Chase was told by the Treasury, don’t pay them, just take the money and hold it. So Chase said, we put a freeze on your account. And so Iran defaulted, and then Chase and the State Department said, oh, Iran defaulted, it missed the payment. Now, all the money that it’s due for foreign debt has to be paid all at once. And Chase paid all of the bondholders off. No more money in the account. It was all emptied out.

Suppose you had an account in Chase Manhattan. And they said, ok, now you’ve done something really bad, you put Michael Hudson on the show. We’re going to grab your account. We’re going to give it to Mr. Guaidó, because he needs the money in Venezuela because the people still are not voting for him. So all of a sudden, you won’t have money in your account. It’ll go to Mr. Guaidó’s account.

Well, that’s what happened with Russia. They took the money. They grabbed the money from Russia’s account. And they said, half the money we’re going to give to, I think, to the 9/11 people, because we all know that it was Russia that bombed the World Trade Center on 9/11.

And we’re going to give it to all sorts of other people who suffered all over the world. It’s all Russia’s fault.

BENJAMIN NORTON: But Professor Hudson, when you say that they seized Russia’s assets, you mean the assets held by the Russian central bank in foreign bank accounts?

MICHAEL HUDSON: Yes, yes.

BENJAMIN NORTON: And these are not physical assets, these are numbers in a computer, right?

MICHAEL HUDSON: In Venezuela’s case, Venezuela had used some of its oil company earnings to buy oil stations and refining companies and the United States actually grabbed the ownership of the gas stations and the refineries and distribution system that Venezuela had in America.

BENJAMIN NORTON: It’s called Citgo.

MICHAEL HUDSON: Citgo, yeah. Russia doesn’t really have any capital investments in the United States. It did have bank accounts, and that was all that the United States could grab.

BENJAMIN NORTON: So when you say that, when Russia, at least for now, the central bank is allowing convertibility of rubles at a set rate into gold, that’s a temporary policy to make sure that they have a physical asset that their central bank can hold on to, because if they have dollars or euros in their reserves, my understanding is that’s not physical cash, it’s actually just numbers in a computer, so they don’t have it physically in their bank reserves, so it’s easy to steal that money.

Obviously, if they had billions of dollars worth of cash, of paper cash, it would be much harder to steal it, but if it’s just on a bank account, if it’s numbers in a computer, then they can just freeze it.

So I think this is also a reflection of a point that you’ve also made about the financialization of the economy, is it’s also just a lot of this capital is not even physical capital.

MICHAEL HUDSON: Yes. Savings take the form – one person’s savings is another person’s debt. So these are Russia’s deposits in American banks that it used to buy or sell rubles, or to buy goods from America, or to receive payments in, if Russia exports something such as oil. Americans buyers of Russian oil would put the money into the Russian bank account.

They never dreamed that this would be grabbed. But now Russia says, ok, you’ve grabbed our money, now that means that we get to grab all of your assets in Russia. This is great! All of your stock holdings in nickel, and Yukos, and all these other companies, ok, you’ve got the money, we have the assets, look at us as just buying the assets on the cheap.

And the Western investors in Russia have all been selling their Russian assets to show that they’re good American citizens in NATO, and the Russians are buying up these European and American assets on the cheap, largely by borrowing money from the banks, that get the money from the central bank, now that they’re so wealthy, and all of the foreign exchange reserves is a result of the American shock-and-awe statement, that’s sort of shock-and-awe in reverse.

So Russia is coming through just fine. And you can imagine how the American strategists are gnashing the teeth. They don’t understand how Russia was able to avoid being bankrupted by this.

They really are not economists. They’re not really financiers. They’re foreign-policy strategists. They’re ideologues that are not very well educated in how to think about the future and how to recognize the fact that the world can actually change from what it is today into something else. And sometimes that change is not in America’s interests. That is sort of not a permitted thought over here.

So essentially, Americans and Europe are operating in the blind, and Russia and China, and Iran, and India, are all looking at how are we going to restructure the world so that we come out of it more prosperous than we were before, not more impoverished. That’s really what the world is dividing into.

BENJAMIN NORTON: Professor Hudson, I don’t know if this is directly related, but it’s it’s something that’s always been a very curious question in my mind.

Germany, back in 2016 and 2017, it moved, physically moved, its central bank’s gold reserves, which had been stored in New York, London, and Paris, and it physically moved those reserves, those gold reserves, to Frankfurt.

Now this was before the U.S. and Britain stole Venezuela’s gold reserves and other reserves. But do you know anything about what motivated Germany’s central bank to move the physical location of its gold reserves into Germany itself?

MICHAEL HUDSON: I don’t think it’s all moved yet. It’s still going on. Gold is very heavy, as heavy has lead, basically. And America said, well, we can only do a little bit, trickle by trickle. So America has been returning the gold very slowly.

So I think Germany, with all of its history of hyper inflation, I think just realizes that, now that gold is not used to settle balance of payments deficits anymore – the gold that Germany had in America was all of the exports that it made to the United States during the Vietnam War. This is Vietnam War gold.

You remember that President de Gaulle would every month cash in, the dollars that America spent in Vietnam would all be spent from Vietnam to Paris, the dollars would end up there, the central bank of Paris would essentially buy gold on the London exchange and keep the gold either in New York or in London.

Well, Germany, because America defeated Germany, and it wasn’t going to keep its gold in Russia, that defeated it even more, it said, well, ok, we’re cashing in our surplus dollars for gold, but we’re going to hold the gold in America.

But now it says, well, America is never going to settle its balance of payments deficits and its foreign debt in gold again, because it doesn’t have any balance of payments surplus, any ability to do that.

It’s going to spend its export surplus and its investment surplus on war. So it’s never going to be able to pay. That’s obvious. Let’s get the gold back.

That was the calculation that every country was making already a decade ago. They realized that America can never repay its foreign debt, unlike other countries.

When other countries can’t pay their foreign debt, they have to go to the International Monetary Fund, that tells them, well, we’ll make you a loan, but you have to sell off your natural resource reserves to the Americans, or we won’t lend you the money.

Well, basically, that’s not going to happen anymore. They realized that America is just going to say, haha, we’re just not going to pay.

Well, now other countries are saying, wait a minute, if America’s never going to repay its foreign debt, why do the Global South countries have to pay their debt to the IMF and the World Bank, all this dollar debt to dollar bondholders?

If America won’t pay, we don’t have to pay. Let’s have a clean slate. Let’s start from the beginning. And we’re only going to have debt and credit relations with friendly countries, not countries that want to go to war with us like America did in Afghanistan, Syria, Iraq, Iran, and now Russia.

So that’s basically what’s happening.

BENJAMIN NORTON: Great. And just to wrap up here, I have another question. And I know your time is limited, so I really appreciate you being here.

I have a quick question about the decline in U.S. dollar hegemony. We were talking about the strength of the ruble, the economic war on Russia; we talked about the bilateral trade that’s growing between Russia and China using the Chinese yuan, between Russia and India using the Indian rupee. And Iran also is talking about doing business with a basket of currencies.

I want to point to a report that was recently published by economists who work with the IMF. And I published an article about this over at Multipolarista.com, “IMF admits US dollar hegemony declining due to rise of Chinese yuan and sanctions on Russia.”

And there is this report that was published by the IMF, by these economists, and I cite you, Professor Hudson, in this report. It’s a working paper from the IMF, published in March, titled “The Stealth Erosion of Dollar Dominance.”

And here’s a graph, for people watching, here’s a graph from the report. And it shows not a large, but a noticeable and consistent decline in the use of the holding of the U.S. dollar in the foreign exchange reserves of central banks around the world. So this is around the world.

And it has declined in the past years from about 70% of central bank exchange reserves to about 60%. So a 10% decline. That’s not massive, but it’s steady and I think it’s going to accelerate.

And at the same time they’ve also found an increase in the use of what they call “non-traditional currencies” in the foreign exchange reserves of central banks around the world.

And here you can see this graph. I mean it looks like a significant influence because if you look at the y-axis it’s only from 90 to 100. But there is a significant increase in the use of other currencies in foreign exchange reserves, aside from the U.S. dollar, the euro, the Japanese yen, and the British pound. And the currency that is increasingly popular is the Chinese yuan.

So that’s one half of my question. The other half is about this interesting report that was published in the Financial Times, and it’s titled “Russia Sanctions Threaten to Erode Dominance of Dollar, says IMF.”

And the FT interviewed the IMF’s first deputy managing director, Gita Gopinath, who acknowledged that the sanctions imposed on Russia over its military intervention in Ukraine could lead to what she says “fragmentation at a smaller level.”

And she did say that the dollar is eroding influence, but “would remain the major global currency.”

So, that’s a two part question. I’m wondering if you could talk about the decline in U.S. dollar hegemony and how the sanctions will potentially erode that. And then the other half of the question is, can you comment on the declining use of dollars in foreign exchange reserves?

MICHAEL HUDSON: Well, this is what my book “Super Imperialism” was all about. When I first published it in 1972, I could see how the whole thing was unfolding for the next 50 years. And we just published last year a third edition of it, bringing it up to date.

Dollar hegemony means America’s entire balance of payments deficit in the ’50s, ’60s, and ’70s was military. So the dollars that were being pumped into the world economy were the result of military spending.

But the dollars would end up in foreign central banks, especially from Asia to France, Germany, others. What were they going to do with it? Well after 1971 they could not buy gold anymore, so all they could do was buy U.S. Treasury securities. IOUs.

And so they re-lent to the Treasury all the money that America was spending militarily. And the more money America spent in waging its cold war militarily against the world, the more money central banks would lend to the U.S. government to finance the U.S. deficit that was spent largely on the military-industrial complex and foreign military operations.

So dollar hegemony was a free lunch financing America’s almost 800 military bases across the world, to fight against communism, defined as any country that doesn’t let American industry and finance buy control of its raw materials, agriculture, resources.

And this has now come to an end. Right now America has grabbed Afghanistan’s, and Russia’s gold. All of a sudden it’s obvious that, this summer, there’s going to be an enormous squeeze on Third World countries, on the Global South.

Their energy prices are going to go way up, and that’s going to hurt them just like the oil shock of 1974 and 1975 did.

They’re going to have to pay higher food costs, because of food prices are going to go way up now that the Ukraine war is erupting.

And a lot of their foreign debt, dollarized debt service, is coming due. And they’re facing a choice: if they pay the foreign debt, they can’t afford to buy the oil and energy that they need to run their factories and heat their homes. They can’t afford to buy the food to feed their people. Whose interests are they going to put first?

Well of course their leaders are going to put America’s interests first, and their own interests second, because their leaders, if they’re a client oligarchy, are put in power by the U.S. military, as sort of miniature Pinochets, throughout Latin America and other countries.

So suppose other countries decide, well, we’re going to feed ourselves and we’re not going to wreck our economy just to pay foreign bondholders. We’re a sovereign country. We’re going to put our national interests first.

Well, then the United States can say, aha, we’re going to grab all of your foreign assets in the United States.

Well, other countries can say, oh, they’re going to do to us just what they did to Afghanistan and Russia. Let’s move our money out of the United States quickly. If we don’t have dollars, well, it’s true, we can’t pay our dollar bondholders, but at least we can, in international markets, we can buy the food and the energy we need.

And so the tensions, the disruption of world prices, and inflation, and trade that is a result of the NATO attack on Russia, now threatens to drive all of the southern hemisphere countries into an alliance with Russia, China, India, and all the rest.

So America basically is creating a new Berlin Wall, but the wall is isolating itself from other countries, and driving other countries all together into what I hope will be a happy, self-sufficient, non-U.S. globalized economy.

BENJAMIN NORTON: Well, I want to thank you, Professor Michael Hudson. It’s always a real pleasure having you. I know you’re very busy, so thank you for giving us so much of your time.

I’ll say that the comment section here on YouTube has been very vibrant, with some interesting conversation. And what’s nice is there are people from all over the world, from the U.S., Latin America, Europe, and from Russia. So it’s good to see a mix of people.

And for anyone who wants to listen to this, you can check out the podcast version if you look up Multipolarista on Spotify, and iTunes, and all the other podcast platforms.

And I’ll just say, while I wrap up here, that today we were talking about, at the beginning of this discussion, a new book that Michael Hudson is publishing this week. It is called “The Destiny of Civilization: Finance Capitalism, Industrial Capitalism, or Socialism.”

It’s a very good book. I had the privilege of getting a review copy early. So definitely check out that book.

You can also find all of Professor Hudson’s writings at michael-hudson.com.

Thanks, Professor Hudson.

MICHAEL HUDSON: It’s really good to be here. It was a good discussion.

A New Order in West Asia: The Case of China’s Strategic Presence in Syria

9 May 2022

Source: Al Mayadeen

Mohamad Zreik 

As the world order shifts into a multipolar world, a new balance of power based on economic ties centered in Asia emerges.

A New Order in West Asia: The Case of China’s Strategic Presence in Syria

Unanimity on a new American century had gone unchecked for a decade. The warhawk John Bolton lambasted Xi’s authoritarianism, claiming the new crackdown has made it practically hard for the CIA to keep agents in China.

Eurasian Economic Union (EEU) has evolved enormously since its inception. Today, multipolarity has developed, promising long-term progress for everyone who follows its norms. And Syria is one among them, had lately returned to world prominence after defeating a decade-long military offensive by the traditional unipolar actors.

In spite of this, unlawful US sanctions continue to harm the hungry, impede the rehabilitation of essential infrastructure and access to clean water, and restrict the livelihood of millions in Syria.

“We welcome Syria’s involvement in the Belt and Road Initiative and the Global Development Initiative,” stated Xi Jinping to Syrian President Bashar Al-Assad on November 5.

In July 2021, Chinese Foreign Minister Wang Yi met with the Arab League’s head to discuss Syria’s return to the fold. A four-point plan to end Syria’s multi-faceted crisis was signed by China at the end of the tour, which coincided with Assad’s re-election.

Surrounded by western-backed separatist movements, Syria reiterated its support for China’s territorial integrity. In 2018, China gave Syria $28 million, and in September 2019, Iraqi Prime Minister Adil Abdul Mahdi proposed China-Iraq oil for rebuilding and greater BRI integration.

Events orchestrated by foreign forces halted this progress. Protests swiftly overthrew Abdul Mahdi’s administration and the oil-for-reconstruction scheme. In recent months, Iraq has rekindled this endeavor, but progress has been modest.

These projects are currently mostly channeled through the 25-year Comprehensive Strategic Partnership deal between China and Iran in March 2021. This might open the way for future rail and energy lines connecting Iran with Iraq and Syria.

At the first formal BRI meeting in April 2019, President Assad stated: “The Silk Route (Belt and Road Initiative) crossing through Syria is a foregone conclusion when this infrastructure is constructed, since it is not a road you can merely put on a map.”

China and Syria are now staying quiet on specifics. Assad’s wish list may be deduced from his previous strategic vision for Syria. Assad’s Five Seas Strategy, which he pushed from 2004 to 2011, has gone after the US began attacking Syria.

The “Five Seas Strategy” includes building rail, roads, and energy systems to connect Syria to the Mediterranean, Persian Gulf, Black, Red, and Caspian Seas. The project is a logical link that connects Mackinder’s world island’s states. This initiative was “the most significant thing” Assad has ever done, he claimed in 2009.

Azerbaijan, Iran, Iraq, and Lebanon were among the countries Assad led delegations to sign agreements with in 2011. President Qaddafi of Libya and a coalition of nations including Sudan, Ethiopia, and Egypt were building the Great Man-Made River at the time.

We can’t comprehend why Qaddafi was killed, why Sudan was partitioned in 2009, or why the US is presently financing a regime change in Ethiopia until we grasp this tremendous, game-changing strategic paradigm. Diplomatic confidentiality between China and West Asia is so essential in the post-regime transition situation.

Over the last decade, BRI-compliant initiatives throughout West Asia and Africa have been sabotaged in various ways. This has been a pattern. Neither Assad nor the Chinese want to go back to that.

The Arab League re-admitted Syria on November 23, revealing the substance of this hidden diplomacy. They have proved that they are prepared to accept their humiliation, acknowledge Assad’s legitimacy, and adjust to the new Middle Eastern powers of China and Russia: the UAE and Saudi Arabia. Unlike decades of US promises that consider Arab participation as disposable short-term interests, the China-Russia cooperation provides genuine, demonstrable advantages for everybody.

The BRI now includes 17 Arab and 46 African countries, while the US has spent the last decade sanctioning and fining those who do not accept its global hegemony. Faced with a possible solution to its current economic problems and currency fluctuations, Turkey has turned to China for help.

Buying ISIS-controlled oil, sending extremist fighters to the region, and receiving arms from Saudi Arabia and Qatar were all known methods of supporting ISIS and Al Qaeda operations in Iraq and Syria. The CIA’s funding has dwindled in recent months, leaving ISIS with little else to work with.

Though US President Joe Biden reiterated US military backing for the Kurdish-led Syrian Defense Forces (SDF), the Kurds’ hand has been overplayed. Many people now realize that the Kurds have been tricked into acting as ISIS’ counter-gang, and that promises of a Kurdish state are as unreal as Assad’s demise. For a long time, it was evident that Syria’s only hope for survival was Russia’s military assistance and China’s BRI, both of which need Turkey to preserve Syria’s sovereignty.

This new reality and the impending collapse of the old unipolar order in West Asia give reason to believe that the region, or at least a significant portion of it, is already locked in and counting on the upcoming development and connectivity boom.

The opinions mentioned in this article do not necessarily reflect the opinion of Al mayadeen, but rather express the opinion of its writer exclusively.

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