Sanctions against Russia are leading Latin America to the abyss

June 27, 2022

Machine translated from:  http://www.opciones.cu/internacionales/2022-04-13/las-extorsiones-contra-rusia-golpean-a-latinoamerica

The war situation between Russia and Ukraine, together with the numerous extortions that the United States and its allies have imposed against Moscow, not only hit economically this nation but also Latin American countries.

One of the most affected is Ecuador because if in 2021, 20% of the bananas it exported were destined to Russia (about 85 million boxes) now it has nowhere to put them and they will spoil with the consequent monetary loss.

Last year Ecuador obtained 706 million dollars for banana exports to the Eurasian giant; 142 million dollars for shrimp; 99 million dollars for flowers; 28 million dollars for fish and 17 million dollars for coffee.

Paraguay had Russia as its second buyer of beef and in 2021 it sent 79 213 tons which represented an income of 314 million dollars and now with the disconnection of Moscow from the international banking system (swift) it does not know how to collect or send the product.

Something similar is happening with Brazil. In the previous period, Brazil sold soybean to Russia for 343 million dollars, 167 million for poultry meat, 133 million for coffee and 117 million for beef.

As for Mexico, it sent cars, computers, beer, tequila, among other products, and bought fertilizers. If it lacks this supply, agriculture will suffer losses and food will become more expensive.

This situation will lead to a worsening of the economic crisis in those nations, with the consequent wage cuts, layoffs of workers and price increases.

The enormous pressures exerted by the United States for Latin American nations to join the policy of Russophobia that it has imposed on the planet by controlling the main media, could aggravate these problems.

For example, an intergovernmental cooperation agreement between Russia and Argentina for the peaceful use of nuclear energy, particularly in the areas of basic and applied research, construction and operation of nuclear power plants and reactors, would be halted.

In addition, Moscow has expressed its interest in participating in a tender for the construction of a dry storage facility for spent nuclear fuel at the Atucha II nuclear power plant in the South American nation.

Washington uses all kinds of extortion to that end: political influence, economic promises and blackmail, as was the case during the recent vote at the UN General Assembly to suspend Russia from the UN Human Rights Council. After the vote, several delegates expressed that for various reasons they had been forced to vote that way.

Due to the impact of the Western “sanctions” war, the supply of fertilizers has been affected, which poses a threat to Latin American farmers, but is advantageous for the United States, which manufactures large quantities of fertilizer. Already, U.S. producers are looking to increase exports to countries in the region.

Fertilizer prices are currently at an all-time high and in the first quarter of 2022 they rose by 30%, which exceeds those reached in 2008 during the global financial crisis.

Due to the “sanctions”, shipments from Russia have been interrupted and this country is one of the main producers and exporters globally.

Moscow is the largest exporter of nitrogen fertilizers and the second largest exporter of potash and phosphorus fertilizers.

In 2021 the Eurasian giant shipped fertilizers worth $12.5 billion. Among its main buyers were Brazil and the European Union with 25% respectively, and the United States with 14%.

As is to be expected, if the fertilizers do not arrive, agricultural production in these countries will be greatly affected.

This complex scenario comes at a time when the Food and Agriculture Organization of the United Nations (UNFAO) reported that the food price index reached 159.3 points in March, an all-time high, while in February it had already beaten the record since the creation of the cost index in 1990.

The agency added that among the five categories that make up the index, four have never recorded such high prices: vegetable oils (248.6 points), cereals (170.1), dairy products (145.2) and meat (120.0).

Two of the categories increased prices in February due to the Russian-Ukrainian conflict: cereals by 17% and vegetable oils by 23%. These countries together export 30 % of the wheat and 20 % of the corn consumed in the world.

The present and future prospects for the Latin American economies are considered difficult because they will have to face the high costs of food products, without yet recovering from the enormous losses caused by the Covid-19 pandemic.

As a corollary, it can be stated that the string of extortions imposed by the United States, not only on Russia but also on more than 30 countries in the world, are leading several Latin American nations into an abyss.

The Musket and the Noodle Stall: A Strategic Comparison

June 23, 2022

Source

By Fred Reed

In big-chunk terms, in the world today we see a contest between the Chinese economy and the American military, between Chinese dynamism and American coercion. Sure, China has a military and the US has an economy. Yet the emphasis, and spirit are as described.

The United States gives priority to the military over civilian economy, with military spending increasing at the expense of internal infrastructure and social needs. By contrast, China focuses on infrastructure within and trade without. I wonder whether Americans are aware of the extent of this. And its likely consequences.

To read the Asian-based press—Asia Times, Nikkei Asia, the South China Morning Post, the Global Times, and various tech sites—is to see a constant stream of infrastructure projects in China and advancing trade outside. As perhaps many know China promotes the Belt and Road Initiative, a massive program to connect all of Eurasia, as well as Africa and Latin America in a huge trade zone connected by rail, highways, fiber optics, maritime links, and commercial treaties. If completed it will dwarf the United States.

China, a rising technological center, leads the world in civil engineering, manufacturing, Five G, trade, and clearly intends to maintain the lead. All power ultimately rests on economic power. Below a few news stories more or less randomly chosen from around the web. Can you think of American equivalents?

China Mandalay Rail Line

“New international railway route from Southwest China’s Chongqing Municipality to Mandalay, southern Myanmar, has officially started operation, with the first freight train departing from Chongqing on Monday, which will arrive in Mandalay about 20 days earlier than what it takes on traditional routes.”

The port will also further connectivity under the Belt and Road Initiative and increase Chinese influence in Myanmar. Key word: Trade

America leads in phenomenally expensive aircraft carriers with serious developmental problems and no particular purpose. Google “Ford class carriers.”

China’s high-speed rail network hit the 40,000-kilometer mark by the end of 2021, reaching out to 93 percent of domestic cities with a population of over 500,000, An Lusheng, deputy head of National Railway Administration, said on Friday. This comes as the country ramps up a push to build itself into a transportation power.”

Fast, pervasive transportation greatly facilitates almost everything. Beijing has said it will have 30,000 miles in a few years. key words: manufacturing, trade, connectivity.

The first China-Russia highway bridge, which stretches from Heihe, a border city in Northeast China’s Heilongjiang Province, to the Russian city of Blagoveshchensk spanning the Heilongjiang River, opened to traffic on Friday, Chinese state broadcaster CCTV reported. It will open a new international highway that will boost the connectivity between cities in China and Russia.“ A few days ago. Here we have more of China’s program to tie all of Eurasia into one interconnected web. Note that it says the “first” bridge. Key words: Trade, connectivity.

China plans new high-volume space-launch facility

“The new Ningbo spaceport, the nation’s fifth such facility, will give a crucial lift to Beijing’s new space programs as its rivalry with the United States reaches space. The spaceport is said to be tailor-made for Chinese commercial aerospace manufacturers and service providers to one day wrest business and foreign orders from US rivals.”

Typical China. Planning five years in advance. If this follows the country’s pattern, construction will begin and continue without interruption until completed. Keyword: Commercial.

America leads the world in overpriced fighter aircraft with a history of unending engineering problems. Google “F-35.”

Cargo carried via New Land-Sea Corridor in western China grows 38% in Jan-May”

“With the RCEP coming into effect, the corridor has played a bigger role in boosting trade between China and ASEAN. On April 8, four trains left Southwest China’s Sichuan Province, carrying aluminum products, agricultural equipment, industrial equipment, chemicals and food to Laos, Thailand, Vietnam and Indonesia

The RCEP, Regional Comprehensive Economic Partnership, is a vast commercial agreement among whose members are all of ASEAN, Japan, Australia, New Zealand, and China.”

Key word: Trade.

Multi-functional modular seabed trencher developed by a Chinese firm has recently completed 100 kilometers of pipelines construction in “Bangladesh’s first marine pipeline project, setting two world records in directional drilling and deep trenching.”

My knowledge of pipeline trenching would be zero even after three cups of coffee and a hearty breakfast. I note, though that it is in Bangladesh: More connection of China and everywhere else. It also sounds like good engineering. Key words: Trade, connectivity.

The CKU Railways will create significant trade opportunities for Kyrgyzstan and Uzbekistan while linking China directly to the Middle East via Rail, with spin off benefits throughout the region.”

China, Kyrgyzstan, and Uzbekistan will be tied more into the Central Asian ecosystem. Construction begins next year. Key words: Trade, connectivity.

America is unchallenged in funny-looking Batplane intercontinental nuclear bomber costing, says Aviation Week, $640 million a copy as America prepares to fill intense world demand for nuclear war. Google “B-21.”

The China-Laos Railway: Yunnan to Vientiane by Bullet Train

Written by Coco Yang Updated Feb. 11, 2022

On December 3rd 2021, the 1,035-km (643-mile) China-Laos Railway was fully opened making possible a bullet train journey of only 10 hours from Kunming to Vientiane, capital of Laos. Key word: Trade.

China-Europe freight train trips top 50,000, yearly growth of 55% from 2016 to 2021

“The value of goods transported by the cargo service skyrocketed to $74.9 billion in 2021, up from $8 billion dollars in 2016, and its share in total trade between China and Europe has increased from 1.5 to 8 percent, according to the release China State Railway Group sent to the Global Times.” America will probably try to block this traffic because it goes through Russia. Again, coercion over competition. Key word: Trade, connectivity.

Proposed US military budget: $857 billion. Keywords: Profits, stupidity.

China Hosts over Sixty Percent of World’s Five G Base Stations

“China had set up a total of nearly 1.43 million 5G base stations as of the end of 2021….”

And many more this year. As can be found by browsing tech sites, China leads in Five G patents, installed base, technology, and manufacturing capacity. Keywords: Trade, manufacturing.

Many millions of Americans can’t read, a hundred thousand a year die of opioid overdoses, the economy is a trainwreck, and despair grows, but the Pentagon has Space Command to give America “Total Spectrum Dominance,” which presumably will pay our mortgages.

China’s digital yuan extends usage into finance scenarios

“SHANGHAI, June 17 (Reuters) – China’s digital yuan can now be used to buy wealth management products, pay for insurance policies, and extend bank loans, as the central bank further expands e-CNY’s application beyond retail shopping, though still only in pilot schemes.”

China is the world’s leading major country in digital currency. Beijing is low-key about it but implications for global finance worry the US. Keywords: Money, connectivity.

US leads world in pricey, unnecessary but glamorous and profitable nuclear-missile submarines. Google “Columbia class submarines.”

China moves toward STEM leadership

Worth reading. “American” prowess in technology increasingly rests on East Asian and Indian scientists and engineers as the US destroys its schools to further inclusiveness. Keywords: Abject, stupidity.

Value of China-Vietnam Cross-border Freight Trains More Than Triples in Q1”

US holds world lead in ratio of money given to the Ukraine to number of citizens living on sidewalks.

China leader in supercomputers: “As of June 2021, 188 of the world’s 500 most powerful supercomputers were located in China, a figure which is a third more than that of its nearest competitor, the United States, which accounted for an additional 122 supercomputers. Together, the two nations account for around 60 percent of the world’s most powerful supercomputers.”

This needs to be read with caution. How the two stack up in aggregate computing power, whatever that means, I don’t know. The US just announced the first exascale computer at Oak Ridge. The Sunway Oceanlight from China is on many websites said to be exascale, but isn’t quite. The important point is that it is entirely of Chinese design from architecture to chips, using silicon of Chinese design and manufacture. It is remarkable that China can manage this in the face of American attempts to strangle the country technologically.

China Launches World’s Largest container Ship

A gorgeous monster. Check photo. China also has seven of the world’s largest cargo ports. Keyword: Trade

Trade deficit with China. Boring but worth a glance.

“During 2021, the United States exported $151,065,200,000 in products to China, but then imported $506,366,900,000 in products from China, resulting in $657,432,100,000 in total trade between the two countries–and a $355,301,700,000 deficit for the United States.” Keyword: Can you guess?

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Sitrep Operation Z: Cauldrons and Fatigue

June 22, 2022

by Saker Staff

Best again today, is Military Summary and worth listening to and watching.  He is ‘predicting’ a ‘riot’ in among the Ukie troops in the cauldron.  There is an update on Snake Island (Serpent Island).

What does become clear is that the map is going to turn very red in large areas very soon.

Yes there is a cauldron with estimated 1,500 to 2,000 Ukrainian forces.  This is where Military Summary expects the ‘military riot’.

The main take-away from the Russian MoD report is this:  “The enemy suffers considerable losses.”

Now we wait for

  • cessation of the shelling into the Donbass and
  • the results of all oil refineries in the Ukraine now non-functional and the results of
  • … this Kadyrov announcement: the imminent encirclement of Lisichansk and the subsequent cleansing of the city.

The Russian Defense Ministry also reported that as many as 500 Ukrainian troops from a single brigade were killed in the city of Nikolaev.

In the wider world, Ukraine War fatigue is setting in.  We still get reports that this country or another country will be sending wizzbang weapons, but if you read the fine print, it is usually dependent on arrival of US or other weapons in exchange.  Here is only one example:

Slovakia is trading with Germany on the terms of military assistance to Ukraine, writes Buisness Insider.According to the publication, Slovakia agrees to supply Kiev with 30 Soviet-made T-72 tanks, but in return requires 30 Leopard 2A4 tanks from Berlin.Germany does not like this formula, they are ready to supply only 15 tanks there — one Leopard for two T-72s.  As a result, all tanks remain in their places, deliveries are delayed, the newspaper notes.

While Ukraine War Fatigue is setting in in the western climes, the fear of cold and a powerless future is also setting in.  The disgust and fatigue with the Ukrainian refugees are now palpable.  What also is turning decidedly red, is some faces of the greens, because we hear that in various places in the EU, they are un-mothballing their old coal power plants.  It is of course not easy to recommission these plants, and one can only laugh because at least 70% of European thermal coal, is imported from Russia.

Our own Mr P, who knows about power plants and engineering wrote up a piece for us in the Cafe.  It is worth taking a look at: http://thesaker.is/moveable-feast-cafe-2022-06-18/#comment-1111759

A central idea is that the coal power plants can be taken out of mothballs, but what about the old skilled craftsmen?

Some overall themes that are appearing, are that Turkey may want to leave NATO (or should we say, subtext, Break NATO) and the EU cannot agree on anything, so, they want to change their ways so that they do not need 100% agreement or approval on anything from the member states.  What this should indicate to us, is that NATO may just be history in a while and the EU as well, in its current form.  Something else can be predicted to change its current form, and that is the United States.  In Texas they have this referendum to determine if it will secede from the US.  It won’t be the last state either.

We are in a tsunami of change, but there is one term that can be used and that is the old military term SNAFU everywhere.  This applies to Zelensky as well, as Zelensky fatigue has now really set in.   Zelensky addressed the African Union and only 4 out of 55 invited heads of state attended the virtual session.

2 Short Updates

The US Embassy in Moscow has a new address (https://t.me/donbassr/22283): 1 Donetsk People’s Republic Square.

Putin: The issue of creating an international reserve currency based on a basket of BRICS currencies is being worked out.  The Russian President also invited representatives of the BRICS countries to the economic forum in Vladivostok in September.

Beggaring Europe: switching cheap Russian gas for expensive American LNG

EU steps to significantly reduce Russian gas imports will see Europe newly dependent on much pricier US liquefied natural gas

June 15 2022

Photo Credit: The Cradle

By Daoud Baalbaki

Europe’s dependency on Russian natural gas has been a contentious issue for European Union (EU) policy makers for decades. Dozens of policies have been proposed over the years to diversify the continent’s gas supply, or to switch to green energy sources in order to minimize reliance on Russian gas.

There are only two ways to transport natural gas – via pipelines, or by liquifying the gas, transporting it as cargo, then re-gasifying it at the destination. Both processes require time and considerable infrastructure investment.

Pipelines: In 2021, Russian natural gas accounted for about 46 percent of the EU’s total natural gas imports with an amount of 155 bcm (billion cubic meters). Figure 1 shows that Russian pipelines provided about 41 percent (about 139 bcm) of these gas imports to the EU over the same period.

Norway is Europe’s second-biggest natural gas supplier, followed by pipelines from North Africa and Azerbaijan.

LNG: Imports of LNG constitute about 21 percent of total European natural gas imports.

Figure 2 shows the sources for the LNG shipments that were imported by the EU in 2021. It is important to note that the United States represents the main supplier for LNG to the EU, and is likely to be the main beneficiary if Russian gas pipelines cease operations. The US only commenced exports of LNG to the EU in 2016, but rapidly reached 22.3 bcm in 2021, representing 23 percent of all LNG exports from the US.

Europe’s dependency

Before the conflict in Ukraine, Russia was still a major supplier for LNG in Europe with about 20 percent of the total LNG imports (equivalent to 16 bcm). This means the EU imported a total of 155 bcm of natural gas from Russia annually – 139 bcm via pipelines and 16 via LNG. This accounts for almost half of all European natural gas imports.

This strategic failure in achieving independence from Russian natural gas was mainly due to lack of a coherent and unified strategy among EU members. As shown in Figure 3 the dependency on Russian natural gas varies from one European country to another.

Countries like the Czech Republic, Slovakia, Latvia, Estonia, Finland, and Hungary are fully dependent on Russian natural gas, while the countries that import the largest quantities like Germany, France, Italy Poland, and Greece are semi-dependent, and countries like Portugal are quasi-independent.

With intense pressure from Washington, this issue of over-reliance on Russian resources became further securitized following the conflict in Ukraine. Even after the west announced sanctions on Russian imports, the EU imported 39 billion euros worth of fossil fuel from Russia, until as recently as mid-May.

Reducing reliance on Russia

According to a Flash Eurobarometer survey for the European Commission (EC), 85 percent of Europeans believe that the EU should reduce its dependence on Russian gas and oil as soon as possible to support Ukraine. Meanwhile the EC, international agencies, and independent think tanks have proposed short term plans to decrease the EU’s dependence on Russian fossil fuels by the end of 2022.

The main three short term plans are the EC’s REPowerEU Plan under which two-thirds of Russian gas (101.5bcm/155bcm) could be replaced by next winter; the International Energy Agency’s (IEA) ten-point plan which proposes a one-third (50bcm / 155bcm) reduction of the Russian natural gas imports, finding alternative sources, and switching to renewable energy; and economic think tank Bruegel’s plan which says, in theory, the EU should be able “to replace Russian [gas] flows entirely,” even in the short term, by calculating Europe’s spare gas import capacity. Realistically, however, Bruegel calls for a reduction (86 bcm/155 bcm) by possibly switching electricity production to nuclear and coal, while applying energy saving policies.

What’s the plan?

Essentially, what these plans all have in common is a call for the EU to diversify its natural gas imports portfolio, switch to renewable energy, and apply policies for energy saving. Of the aforementioned plans, the REPowerEU strategy appears to be the most feasible.

The plan suggests cutting Russian natural gas imports to 101.5 bcm from 155 bcm in 2021 – in theory, by increasing non-Russian gas supply by 63.5 bcm, and reducing gas demand by 38 bcm.

To increase non-Russian gas supply by 63.5 bcm, the plan assumes the following can be achieved:

  1. Increase non-Russian LNG imports by 50 bcm
  2. Increase non-Russian pipeline imports by 10 bcm.
  3. Increase biomethane production by 3.5 bcm.

Complimentary to this, they also recommended reducing gas demand by 38 bcm. For this, they proposed 4 points:

  1. Energy savings to cut demand by 14 bcm
  2. Rooftop solar power to reduce gas demand by 2.5 bcm
  3. Heat pumps to reduce gas demand by 1.5 bcm
  4. Deploying wind and solar in the power sector to reduce gas demand by 20 bcm.

The first problem with the EC study is that it expects the demand for gas in Europe in 2022 to remain the same as in 2021. Studies shows that the continent may need around 20-25 bcm more than in the same period last year. So, the target gas requirement is actually 121.5 – 126.5 bcm – not just replacing the Russian imports of 101.5 bcm.

Increasing non-Russian LNG

By far the most important metric here is the EU’s current regasification capacity. As mentioned above, when imported as LNG, the liquified gas needs to be regasified by specialized plants in ports in order to be reinjected into pipelines. All combined, the EU countries had around 74 bcm spare regasification capacity last year.

The problem is that about half this spare capacity is concentrated in Spain and Portugal, which are linked to the rest of the EU with a pipeline of just 7.5 bcm/year capacity. Therefore, the EU has insufficient re-gasification plants to import an additional 50 bcm of LNG.

The proposed solution is to use the UK (now, officially outside the EU) – which has around 29 bcm spare regasification capacity – as a land bridge to import LNG and then reexport it to the EU via pipelines. In this scenario, the EU may succeed in importing an extra 50 bcm of LNG.

But even if Europe overcomes the regasification obstacle, is there enough LNG supply in the world to cover the demand?

Switching dependency from Russia to the US 

Due to many export plants struggling with technical and feed gas issues during the year, global LNG export capacity actually declined in 2021, despite the continued rise in capacity in the US. At the beginning of 2022, it was estimated that the LNG global export capacity will increase by some 43 bcm if all plants that had technical issues and shutdowns were to come back online.

In the second quarter of this year, the International Energy Agency’s gas market report estimated that the EU’s LNG imports may increase by a maximum of 25 bcm and that 65 percent of this quantity will be supplied by the US.

If this transpires, US LNG exports will increase by a whopping 19 percent, making it the global leader of LNG exports overnight. Meanwhile, Africa, Europe, Central and South America and Eurasia will have smaller contributions to global LNG supply growth in 2022, while the supply of the Asia Pacific and West Asian regions are expected to decline.

If we take Qatar as an example, despite its leading role in LNG markets and close relations with western states, Qatar is unable to supply Europe with extra large quantities in the short term because it suffers from a lack of spare LNG export capacity. Furthermore, over 70 percent of these exports are sold to Asian buyers via long term contracts. Europe would have to wait until 2024-25 to be able to count on Qatari LNG supplies.

This high-level demand for LNG projected by Europe will saturate the market and increase the competition for flexible LNG cargoes. In order to attract more LNG cargoes, spot prices in Europe should be $2-3/MMBtu higher than the Asian markets. This is leveling now at $35/MMbtu for the rest of 2022 which is more than five times their five-year average.

The bottom line is that it will be impossible for the EU to increase their LNG imports by the crucial 50 bcm milestone. Even if the EU overcomes the technical issues represented by the regasification capacities and the interconnections between the EU countries and Britain, the supply in the global LNG market simply cannot meet the demand.

Although Europe may receive an extra 25 bcm of LNG, it will come attached to a very high price tag, while prices in North America will be largely unaffected. The US is the big winner in this scenario, raking in exorbitant profits while establishing itself as the world’s biggest LNG exporter.

Where are the non-Russian gas pipelines?

Norway: As the main non-Russian gas supplier of natural gas to Europe via pipelines, Norway’s total capacity of supply is 94.3 bcm per year. Only 86.3 percent of this capacity was used in 2021, theoretically leaving 12.9 bcm of spare annual capacity.

However, in the first two quarters of 2022, the pipelines have been working close to effective full capacity, and this capacity is expected to be lower in the summer, as previous records indicate.

North Africa: The other source of pipeline natural gas to Europe is via three pipelines from North Africa: The Medgaz pipeline from Algeria to Spain, the Trans-Mediterranean Pipeline (also known as Transmed which carries Algerian gas from Tunisia to Italy), and the Green Stream pipeline, from Libya to Italy. A fourth pipeline, the Gas Pipeline Maghreb-Europe (GME), runs from Algeria to Spain via Morocco, but has not been used since 1 November 2021, following the breakdown of diplomatic relations between Algeria and Morocco that August.

The flow in Medgaz pipeline to Spain can increase by around 2 bcm, after increasing its capacity.  These extra quantities can cover a part of the quantities that have been delivered via GME in 2021. However, Algeria has also recently suspended trade ties with Spain over the latter’s decision to side with Morocco over the disputed Western Sahara territory, which has exacerbated tensions between Rabat and Algiers.

The Transmed pipeline to Italy has around 10 bcm spare capacity, but recent analysis shows that Algeria will not be able to offer additional gas quantities since reaching its production capacity and needing to address its own growing domestic demand.

Exports in Libya ranged around 5 bcm before 2020 but declined to 3.2bcm in 2021. A recovery can offer the extra 1-2 bcm, but ongoing political instability in Libya can offer no such guarantees.

As a result, North Africa is not foreseen to provide any extra-large quantities of gas to Europe in 2022.

Azerbaijan: In 2021, the EU started receiving natural gas from Azerbaijan via the Trans Adriatic Pipeline (TAP). The capacity of TAP is around 11 bcm, and flows in 2021 totaled 8.1 bcm, meaning there is extra capacity of around 2.5 bcm.

Overall, the EU plan is based on making a year-on-year increase of 2-3 bcm from Azerbaijan, 2-3 from Algeria, and 4-5 bcm from Norway. These appear to be achievable with regards to the pipelines’ spare capacities, but ambitious in terms of gas production quantities for the suppliers.

Trading dependencies

This European demand for non-Russian gas will mainly be covered by the United States which is the only player that stands to gain economically. It is therefore in Washington’s interests that Europe converts a big part of its gas imports from Russian pipelines into LNG. It is also why the US has remained determined for years to stop the Russia-to-Germany NordStream 2 pipeline from becoming operational – which it succeeded in doing in February, as tensions over Ukraine worsened.

As the US has its own independent pricing system, it is not affected by the international gas prices, which are expected to rise significantly in the European and Asian markets, bringing instant value to LNG production activities in the US.

The EU plan to cut two-thirds of its Russian gas imports and replace it elsewhere – by the end of 2022 – is very optimistic. Closer scrutiny shows it will come with a very high cost – around five times the price that Europe used to pay. Whichever plan the EU implements, Europe will have to acknowledge that it will be neither an energy independent or politically independent continent for the foreseeable future.

The views expressed in this article do not necessarily reflect those of The Cradle.

Will the Global South break free from dollarized debt?

In his latest book, economist Michael Hudson pits socialism against finance capitalism and tears apart the ‘dream civilization’ imposed by the 1 percent.

June 09, 2022

By Pepe Escobar

Let’s jump straight into the fray. Hudson begins with an analysis of the “take the money and run” ethos, complete with de-industrialization, as 90 percent of US corporate revenue is “used to share buybacks and dividend payouts to support company stock prices.”

Michael Hudson’s new book on the world’s urgent global economic re-set is sure to ruffle some Atlanticist feathers.Photo Credit: The Cradle

With The Destiny of Civilization: Finance Capitalism, Industrial Capitalism or Socialism, Michael Hudson, one of the world’s leading independent economists, has given us arguably the ultimate handbook on where we’re at, who’s in charge, and whether we can bypass them.

That represents the apex of “Finance Capitalism’s” political strategy: to “capture the public sector and shift monetary and banking power” to Wall Street, the City of London and other western financial centers.

The whole Global South will easily recognize the imperial modus operandi: “The strategy of US military and financial imperialism is to install client oligarchies and dictatorships, and arm-twist allies to join the fight against designated adversaries by subsidizing not only the empire’s costs of war-making (“defense”) but even the imperial nation’s domestic spending programs.” This is the antithesis of the multipolar world advocated by Russia and China.

In short, our current Cold War 2.0 “is basically being waged by US-centered finance capitalism backing rentier oligarchies against nations seeking to build up more widespread self-reliance and domestic prosperity.”

Hudson presciently reminds us of Aristotle, who would say that it is in the interest of financiers to wield their power against society at large: “The financial class historically has been the major beneficiary of empires by acting as collection agents.”

So inevitably the major imperial leverage over the world, a true “strategy of underdevelopment,” had to be financial: instrumentalizing IMF pressure to “turn public infrastructure into privatized monopolies, and reversing 20th century pro-labor reforms” via those notorious ‘conditionalities’ for loans.

No wonder the Non-Aligned Movement (NAM), established in Belgrade in 1961 with 120 nations and 27 observers, became such a threat to US global strategy. The latter predictably fought back with a slew of ethnic wars and the earliest incarnations of color revolution – fabricating dictatorships on an industrial scale, from Suharto to Pinochet.

The culmination was a cataclysmic Houston get-together in December 19, 1990 “celebrating” the dissolution of the USSR, as Hudson reminds us how the IMF and the World Bank “laid out a blueprint for Russia’s leaders to impose austerity and give away its assets – it didn’t matter to whom – in a wave of ‘shock therapy’ to let the alleged magic of free enterprise create a neoliberal free-for-all.”

Lost in a Roman wilderness of debt

To a large extent, nostalgia for the rape-and-pillaging of 1990s-era Russia fuels what Hudson defines as the New Cold War, where Dollar Diplomacy must assert its control over every foreign economy. The New Cold War is not waged only against Russia and China, “but against any countries resisting privatization and financialization under US sponsorship.”

Hudson reminds us how China’s policy “followed almost the same path that American protectionism did from 1865 though 1914 – state subsidy for industry, heavy public-sector capital investment…and social spending on education and health care to upgrade the quality and productivity of labor. This was not called Marxism in the United States; it was simply the logical way to look at industrialization, as part of a broad economic and social system.”

But then, finance – or casino – capitalism gained steam, and left the US economy mainly with “agribusiness farm surpluses, and monopolies in information technology (largely developed as a by-product of military research), military hardware, and pharmaceutical patents (based on public seed-money to fund research) able to extract monopoly rent while making themselves largely tax-exempt by using offshore banking centers.”

That’s the current State of Empire: relying only “on its rentier class and Dollar Diplomacy,” with prosperity concentrated in the top one percent of establishment elites. The inevitable corollary is US diplomacy imposing illegal, unilateral sanctions on Russia, China and anyone else who defies its diktats.

The US economy is indeed a lame post-modern remake of the late Roman empire: “dependent on foreign tribute for its survival in today’s global rentier economy.” Enter the correlation between a dwindling free lunch and utter fear: “That is why the United States has surrounded Eurasia with 750 military bases.”

Delightfully, Hudson goes back to Lactantius, in the late 3rd century, describing the Roman empire on Divine Institutes, to stress the parallels with the American version:

“In order to enslave the many, the greedy began to appropriate and accumulate the necessities of life and keep them tightly closed up, so that they might keep these bounties for themselves. They did this not for humanity’s sake (which was not in them at all), but to rake up all things as products of their greed and avarice. In the name of justice they made unfair and unjust laws to sanction their thefts and avarice against the power of the multitude. In this way they availed as much by authority as by strength of arms or overt evil.”

Socialism or barbarism

Hudson succinctly frames the central issue facing the world today: whether “money and credit, land, natural resources and monopolies will be privatized and concentrated in the hands of a rentier oligarchy or used to promote general prosperity and growth. This is basically a conflict between finance capitalism vs. socialism as economic systems.”

To advance the struggle, Hudson proposes a counter-rentier program which should be the Global South’s ultimate Blueprint for responsible development: public ownership of natural monopolies; key basic infrastructure in public hands; national self-sufficiency – crucially, in money and credit creation; consumer and labor protection; capital controls – to prevent borrowing or denominating debts in foreign currency; taxes on unearned income such as economic rent; progressive taxation; a land tax (“will prevent land’s rising rental value from being pledged to banks for credit to bid up real estate prices”); use of the economic surplus for tangible capital investment; and national self-sufficiency in food.

As Hudson seems to have covered all the bases, at the end of the book I was left with only one overarching question. I asked him how he analyzed the current discussions between the Eurasia Economic Union (EAEU) and the Chinese – and between Russia and China, further on down the road – as being able to deliver an alternative financial/monetary system. Can they sell the alternative system to most of the planet, all while dodging imperial financial harassment?

Hudson was gracious enough to reply with what could be regarded as the summary of a whole book chapter: “To be successful, any reform has to be system-wide, not merely a single part. Today’s western economies have become financialized, leaving credit creation in private hands – to be used to make financial gains at the expense of the industrial economy… This aim has spread like leprosy throughout entire economies – their trade patterns (dependency on US agricultural and oil exports, and IT technology), labor relations (anti-unionism and austerity), land tenure (foreign-owned plantation agriculture instead of domestic self-reliance and self-sufficiency in food grains), and economic theory itself (treating finance as part of GDP, not as an overhead siphoning off income from labor and industry alike).”

Hudson cautions that “in order to break free of the dynamic of predatory finance-capitalism sponsored by the United States and its satellites, foreign countries need to be self-sufficient in food production, energy, technology and other basic needs. This requires an alternative to US ‘free trade’ and its even more nationalistic ‘fair trade’ (deeming any foreign competition to US-owned industry ‘unfair’). That requires an alternative to the IMF, World Bank and ITO (from which Russia has just withdrawn). And alas, an alternative also requires military coordination such as the SCO [the Shanghai Cooperation Organization] to defend against the militarization of US-centered finance capitalism.”

Hudson does see some sunlight ahead: “As to your question of whether Russia and China can ‘sell’ this vision of the future to the Global South and Eurasian countries, that should become much easier by the end of this summer. A major byproduct (not unintended) of the NATO war in Ukraine is to sharply raise energy and food prices (and shipping prices). This will throw the balance of payments of many Global South and other countries into sharp deficit, creating a crisis as their dollar-denominated debt to bondholders and banks falls due.”

The key challenge for most of the Global South is to avoid default:

“The US raise in interest rates has increased the dollar’s exchange rate not only against the euro and Japanese yen, but against the Global South and other countries. This means that much more of their income and export revenue must be paid to service their foreign debt – and they can avoid default only by going without food and oil. So what will they choose? The IMF may offer to create SDRs to enable them to pay – by running even further into dollarized debt, subject to IMF austerity plans and demands that they sell off even more of their natural resources, forests and water.”

So how to break free from dollarized debt? “They need a critical mass. That was not available in the 1970s when a New International Economic Order was first discussed. But today it is becoming a viable alternative, thanks to the power of China, the resources of Russia and those of allied countries such as Iran, India and other East Asian and Central Asian countries. So I suspect that a new world economic system is emerging. If it succeeds, the last century – since the end of World War I and the mess it left – will seem like a long detour of history, now returning to what seemed to be the basic social ideals of classical economics – a market free from rent-seeking landlords, monopolies and predatory finance.”

Hudson concludes by reiterating what the New Cold War is really all about:

“In short, it is a conflict between two different social systems, each with their own philosophy of how societies work. Will they be planned by neoliberal financial centers centered in New York, supported by Washington’s neo-cons, or will they be the kind of socialism that the late 19th century and early 20th century envisioned – a ‘market’ and, indeed, society free from rentiers? Will natural monopolies such as land and natural resources be socialized and used to finance domestic growth and housing, or left to financial interests to turn rent into interest payments eating into consumer and business income? And most of all, will governments create their own money and steer banking to promote domestic prosperity, or will they let private banks (whose financial interests are represented by central banks) take control away from national treasuries?”

The views expressed in this article do not necessarily reflect those of The Cradle.

The Eurasian Economic Union Steps Up

May 28, 2022

The Eurasian Economic Forum has shown once again that this high-speed – economic integration – train has already left the station.

By Pepe Escobar, posted with the author’s permission and widely cross-posted. 

The first Eurasian Economic Forum, in Bishkek, Kyrgyzstan, took place this week at a very sensitive geopolitical juncture, as Russian Foreign Minister Sergei Lavrov keeps stressing that, “the West has declared total war against us, against the entire Russian world. Nobody even hides this now.”

It’s always important to remember that before Maidan in 2014, Ukraine had the option to become a full member of the Eurasian Economic Union (EAEU), and even balance it with a loose association with the EU.

The EAEU comprises five full members – Russia, Kazakhstan, Kyrgyzstan, Belarus and Armenia – yet 14 nations sent delegations to the forum, including China, Vietnam and Latin American nations.

There was much rumbling that the proceedings would be jeopardized by the serial sanctions packages imposed on Russia by the collective West. There’s no question that some EAEU members – such as Kazakhstan – seem to be more worried about the effects of the sanctions than about fine-tuning business with Russia. Yet that’s not the point.

The crucial point is that by 2025 they have to harmonize their legislation concerning financial markets. And that’s directly connected to what the executive body of the EAEU, led by Sergey Glazyev, is working on, extensively: designing the lineaments of an alternative financial/economic system  to what the West would rather coin as Bretton Woods 3.

The Eurasian Economic Forum was established by the Supreme Eurasian Economic Council explicitly to further deepen economic cooperation between EAEU members. No wonder the official theme of the forum was Eurasian Economic Integration in the Era of Global Shifts: New Investment Opportunities, focusing on strategic development in the industrial, energy, transport, financial, and digital areas.

So Many Converging Strategies

President Putin’s speech to the plenary session was quite revealing. To really appreciate the scope of what’s implied, it’s important to remember that the Greater Eurasian Partnership concept was presented by Putin in 2016 at the St. Petersburg Economic Forum, focused on a “more extensive Eurasian partnership involving the Eurasian Economic Union” and including China, Pakistan, Iran and India.

Putin stressed how the drive for developing ties “within the framework of the Greater Eurasian Partnership” (…) “was not the political situation but global economic trends, because the centre of economic development is gradually – we are aware of this, and our businesspeople are aware of this – is gradually moving, continues to move into the Asia-Pacific Region.”

He added, “in the current international conditions when, unfortunately, traditional trade and economic links and supply chains are being disrupted”, the Greater Eurasian Partnership “is gaining a special meaning.”

Putin established a direct connection not only between the Greater Eurasian Partnership and EAEU members but also “BRICS members such as China and India”, “the Shanghai Cooperation Organization, ASEAN and other organizations.”

And that’s the core of the whole, ongoing, multi-layered process of Eurasia integration, with the China-led New Silk Roads intersecting with the Eurasia Economic Union, the SCO, BRICS+, and other converging strategies.

Lavrov this week said that Argentina and Saudi Arabia want to join BRICS, whose next summer in China is being meticulously prepared. Not only that: Lavrov mentioned how quite a few Arab nations want to join the SCO. He was careful to describe this process of converging alliances as “not antagonistic”.

Putin for his part was careful to define the Greater Eurasian Partnership as “a big civilizational project. The main idea is to create a common space for equitable cooperation for regional organizations”, changing “the political and economic architecture on the entire continent.”

Thus, the necessity to “draft a comprehensive strategy for developing large-scale Eurasian partnership”, including “a roadmap for industrialization”. That translates in practice as developing “engineering centers and research centers. This is inevitable for any country that wants to increase its economic, financial, and ultimately political sovereignty. It is inevitable.”

Yaroslav Lissovolik  at the Valdai Club is one of the top analysts tracking how this convergence may profit the whole Global South. He stresses that among the “variability and diversity in the platforms that may be launched by Global South economies, the most sizeable and comprehensive of which could include the aggregation of CELAC (Latin America), African Union (Africa)”, and the SCO in Eurasia.

And an even more diverse set of “regional blocs that targets deeper integration could feature a BRICS+ platform that comprises the South African Development Community (SADC), MERCOSUR, BIMSTEC”, the China-ASEAN free trade agreement, and the EAEU.

The Eurasian Economic Forum has shown once again that this high-speed – economic integration – train has already left the station. It’s quite enlightening to notice the sharp contrast with the endless doom and gloom afflicting a collective West prone to inflation, energy shortages, food shortages, fictional “narratives” and the defense of neo-Nazis under the banner of liberal “democracy”.

Balancing grenades: To contain China, the US will ignore Russia in India

May 26 2022

To keep India onside, the US will seek to focus on China with New Delhi, and underplay the latter’s close relations with Russia.Photo Credit: The Cradle

By Mobeen Jafar Mir

Divergent policies on Moscow will not get in the way of Indo-US efforts to counter Beijing’s regional influence.

Once referred to as ‘Enduring Global Partners in the 21st Century,’ the strategic alliance between India and the United States has entered a challenging phase since the February launch of Russia’s military operations in Ukraine.

As the only ‘major democracy’ to maintain a neutral position on the Ukraine conflict, New Delhi’s ties with Washington are being tested over disagreements on how to deal with Moscow.

The duo’s ‘Comprehensive Global Strategic Partnership’ is based purely on guaranteeing mutual national interests: securing international peace and security through regional cooperation in the Pacific, strengthening ‘shared democratic values,’ policing nuclear non-proliferation, and enhancing cooperation on economic and security priorities.

Today, although New Delhi and Washington are poles apart on Russia’s actions in Ukraine, one area where Indo-US relations remain in lockstep is the issue of containing China’s rising influence.

The Quad squad

This was illustrated in February during this year’s fourth Quadrilateral Security Dialogue (Quad) Foreign Ministers Meeting when India signalled its lack of enthusiasm for the Quad’s sharp criticism of Russia.

Initiated in 2007, the Quad is an informal alliance comprising the US, India, Australia and Japan, and was especially formed to collectively stand as a bulwark against Chinese ‘expansion’ in the region.

India, unlike its Quad allies, maintained silence on Ukraine, but continued its alignment with their positions against China’s growing role and ambitions in the Indo-Pacific.

The Leaders’ Meeting held in Tokyo this week comes amid growing concern over whether the US will take military action should China – theoretically emboldened by Russia – decide to invade Taiwan. Indian Prime Minister Narendra Modi has also held bilateral talks with US President Joe Biden, with greater emphasis on cooperation between their National Security Councils.

Mutual concerns over China

During February’s Quad meeting for foreign ministers, US Secretary of State Antony Blinken also hinted that while punishing Russia for its Ukraine policy was ‘front and center’ of the US’ immediate foreign policy priorities, the long-term challenge was working closely with regional allies to “out-compete” China. In this context, India is a pivotal US ally.

The US and India are thus likely to soft pedal Russia-related differences for the sake of consolidating a ‘maritime rules-based order’ in the Pacific, where the US and its regional allies seek to thwart Chinese influence.

In its effort to bolster India as a potential counterweight to China, the US has inserted itself directly into Indo-Pacific affairs, a political development that has irked the Chinese and Russian leadership alike.

Why did India resist US pressure to condemn Russia?

India’s refusal to sanction Russia over Ukraine is understandable within the context of their decades of close relations, cooperation and commerce. In recent years, Moscow and Delhi have together increased their global clout as members of the Shanghai Cooperation Organization (SCO) and BRICS, cooperative political platforms that have proactively advanced more multipolar agendas.

The fact is, while Washington may have pushed New Delhi to adopt a tough stance against Moscow, Russia is still India’s largest defence partner and the country’s weapons are heavily reliant on Russian spare parts for proper functioning.

Security interests for both countries have converged in neighbouring Afghanistan. After the chaotic US withdrawal from the war-torn country, India has also repositioned its priorities there.

After the Taliban’s accession to power in Kabul last summer, both India and Russia have further expanded their cooperation by establishing a ‘permanent bilateral channel for consultations’ on Afghan affairs.

Russia effectively aids India’s engagement with the Taliban-led government. Both countries have been actively engaging on Afghan terrorism and drug trafficking priorities, and bilateral intelligence cooperation between Moscow and New Delhi appears to also be expanding into Central Asia.

Despite the recent strengthening of Russian and Chinese strategic cooperation, competition continues to exist between the two states in Central Asia, the Arctic and the Russian Far East. A politically stable and economically powerful Russia is in Indian interests as it could potentially act as a counterbalance to rising Chinese power in these regions.

To this end, a maritime corridor between India and Russia has already been formalized. The corridor, upon functioning, can improve their mutual economic clout and allow the duo to potentially rival China in the South China Sea and Russian Far East.

A strong Russia is in India’s interests

Tanvi Madan, an Indian foreign policy expert at the Brookings Institution in Washington, DC, fears that Russia’s excessive reliance on China may damage Kremlin’s political and economic leverage and push it into China’s sphere of influence, thus costing New Delhi a viable mediator in the event Sino-Indian border tensions re-erupt. It is one of the reasons compelling India to oppose the US policy of weakening Russia through economic sanctions.

There are also widespread concerns in New Delhi that growing Chinese influence in Moscow may halt weapons supplies to India and make India vulnerable to any likely assault from Beijing in the future.

During a series of border skirmishes between Indian and Chinese armed forces, Washington issued mere boilerplate statements rather than playing a constructive role in diffusing the crisis. This, among other factors, has convinced Indian policy makers that the Kremlin can be a more reliable partner in resolving any future flare-ups with Beijing.

Indo-US cooperation on China

While the Biden administration remains unsure about whether or not to impose sanctions on India under CAATSA (Countering America’s Adversaries Through Sanctions Act) for purchasing Russian S-400 missiles, both states continue to deepen their strategic partnership on China.

Similarly, against all western expectations during April’s 2+2 Ministerial Dialogue between the US and India, the latter again declined to condemn Russian military operations in Ukraine. India continues to buy oil from Russia at competitive prices and resents the US for admonishing it over this.

Despite US statements on deteriorating human rights conditions in India, increasing disquietness about trade policy matters, and India’s repeat abstentions on US-sponsored resolutions against Russia, their mutual rivalry against China has kept the relationship engaged and afloat.

The Indo-US focus on China has played out in various spheres. During the US administration of Donald Trump, India was granted a sanctions waiver to continue purchasing oil from Iran – part of efforts to support India’s INSTC (International North South Transport Corridor) which New Delhi presents as a counter to China’s Belt and Road Initiative (BRI).

Bilateral trade and investment between the US and India also hit record levels last year.  In their collective quest to contain Chinese economic influence in its own region, both duo appear unanimous in criticizing the China-Pakistan Economic Corridor (CPEC), a political development perturbing policy makers in Islamabad.

Why is the Sino-Indian rivlary intensifying?

The Indian Ocean Region (IOR) has lately transformed into a major hotspot over the growing rivalry between Beijing and New Delhi, two of Asia’s biggest economic powerhouses. The region’s growing geostrategic importance – connecting energy-rich West Asia to energy-hungry East Asia – has compelled the two to vie for that dominance.

As both China and India are heavily reliant on hydrocarbons to shore up their economic engine, the IOR becomes pivotal for the uninterrupted flow of their seaborne trade and energy imports. The US naval presence in the region, however, has indisputably played a key role in the intensification of hostility between the two Asian giants.

The US considers the region crucial for its economic interests and security as any likely disruption to these seaborne lanes can have serious implications for US hegemony and the global economy at large.

The New Silk Road

In order to contain China’s rise, the US has inserted itself into the region by aggressively consolidating strategic, diplomatic, and military ties with regional allies – in it much-ballyhooed “Pivot to Asia.” Inevitably, this strategic move has heightened tensions between China and allies of the US, notably India.

Washington’s strategy is not necessarily working as seamlessly elsewhere. On Wednesday, the Japanese foreign ministry announced the results of a 2021 ASEAN survey that showed respondents selecting China as the G20’s most important future partner country. Japan slipped to second place for the first time since the survey launched in 2015, with the US coming in third.

To circumnavigate the threats posed to its sea lanes by the Indo-US presence in the IOR, China is diversifying its energy and trade routes. In this regard, the BRI has become an instrument of reducing strategic vulnerabilities through expansion of regional trade and infrastructural investments in areas falling outside the strategic choke point of the Strait of Malacca, a narrow sea area between the Indonesia island of Sumatra and the Malay Peninsula through which China imports more than 80 percent of its oil.

As the rivalry between China and India is not limited to the Himalayan region and has largely become maritime-focused, the expansion of China’s BRI in South and Central Asia is reducing China’s vulnerability to possible future Indian and US attacks in the East China Sea and the South China Sea to disrupt Chinese seaborne trade.

Another relevant component of the BRI, is the aforementioned CPEC, connecting China’s Xinjiang region to Pakistan’s Gwadar seaport. Through CPEC, China aims to solve its ‘Malacca Dilemma’ while simultaneously consolidating its economic and political ties with New Delhi’s nemesis, Islamabad.

A Passage to India…or Bharat

India fears that after the Chinese encirclement of its sea lanes through growing strategic presence in Pakistan, Myanmar (Burma), Sri Lanka, and Djibouti, the BRI can also pose threats to India’s land trade routes while simultaneously mitigating the impact on China from a combined Indo-US assault on its sea lanes.

The current ‘Hindu nationalist’ government of India, with its own ideologically expansionist designs, has also been responsible for exacerbating the crisis with China. New Delhi’s ties with its neighbours are largely dictated by the idea of Akhand Bharat, a term used by right-wing Hindu nationalists for a vision to restore a unified Indian subcontinent.

By referring to India as Vishwa Guru or ‘teacher to the world’, Modi has convinced his devotees that only he can restore the lost greatness of Hindustan. This expansionist mindset has pitted the country against its many neighbors, while Modi has used the narrative to consolidate his Hindu support base.

Who needs who?

In addition to Washington’s efforts at propping up India as an outsourcing-alternative to China for US companies, the growing Indian middle class are also perceived as a desired and lucrative destination for US exports.

The ‘limitless friendship’ between Russia and China is seen as a threat to US hegemony and may even require India as a bridge to reach out to Russia in the future. In fact, some strategists in Washington even suggest a ‘wedge’ strategy of engaging Russia to prevent it becoming overly dependent on China, and thus fostering a sense of rivalry between these two great-power rivals in their shared Eurasian space.

In this context, India’s partnership with Russia in key parts of Eurasia – such as Afghanistan and Central Asia – make it an ideal bridge to Moscow.

India and the US are likely to compartmentalize their priorities without coercing each other to veer too far from their respective interests. While unhappy about it, the US understands India’s sensitivities towards Russia and will pragmatically tone down its criticism of New Dehli’s positions.

The alternative would drive a wedge between the two allies and compromise their collective effort to contain China. If the US needs India to counter China, India surely needs both Russia and the US to keep China at bay.

The views expressed in this article do not necessarily reflect those of The Cradle.

Pepe Escobar : Interview with The Press Project

May 22, 2022

From a unipolar to a multipolar world.  This is my itvw with the wonderful folks at The Press Project in Greece.  In English, with Greek subtitles.

Michael Hudson: Interview with RT – Transcript

May 21, 2022

Source

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.

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.

A gun is worth a thousand Nazi words

15 May 2022

Source: Al Mayadeen & Agencies

By Mohammad Al-Jaber 

“A picture is worth a thousand words” applies when it comes to photography and art. But when it comes to a crime, all of whose details are documented by the assailants themselves, all words fail to leave the mouth – or fingertips – in awe.

A gun is worth a thousand Nazi words, or maybe 14, in the case of Payton Gendron

The United States was shaken late Saturday by the news of a white, gun-toting neo-Nazi teen that wanted to reflect his supremacist ideology on the ground as a means of realizing his aspiration of eradicating those whose existence goes against his beliefs.

18-year-old Payton Gendron carried out a mass shooting at a supermarket in Buffalo, New York, claiming the lives of 10 people while three others are being provided with medical care. Gendron shot 13 people; 11 Black people and two White people, which reflects the motive behind the attack streamed on Twitch for the whole world to see the gruesome reality of the far-right.

The crime took place in a predominantly black neighborhood located more than 320 km (200 miles) away from where he resides, meaning it was not by mere coincidence and had been premeditated, for one does not simply find themselves in a parking lot 300 km away from home, donning military-style gear, a bulletproof vest, and a tactical helmet, opening fire on strangers.

The shooting spree is currently under investigation as both “a hate crime and a case of racially-motivated violent extremism.” But is it truly a hate crime?

What are the implications of such an act that emboldens supremacist acts and further racially-motivated crimes?

We have to start with crimes of this sort in the United States unrelated to race and conducted arbitrarily throughout the country: mass shootings.

A bullet with ‘US’ on it

The US, home to the loosest gun laws in the world, has the most mass shootings in the world. US citizens lead the world in terms of gun ownership, with estimations suggesting that there were 390 million guns in circulation in 2018, with a rate of 120.5 guns per 100 residents.

In the country where you can buy an automatic rifle at your local convenience store, more than 45,000 Americans died due to gun violence in 2020 alone, exceeding any other year on the record. But as Democrats and Republicans battle it out on the Congress floor, dozens of Americans die at the end of a barrel of a gun on a daily basis.

With any advocacy on gun control ruled “unconstitutional” by many avid arms enjoyers, the American people are the only collateral damage there is. And though gun advocacy is prominent on both sides of the political spectrum, it is the right that is the most significant backer of even looser gun laws, for it sees it as a means of propagating its values.

One in the chamber for the far-right

While many pro-gun advocates argue that laws protecting arms possessions are to protect citizens against criminals and the government if the latter were to “turn” oppressive, the far-right is utilizing this argument to give rise to itself as it is gaining more momentum and popularity in itself.

The right-wing has been gaining more ground in light of the latest events, as it saw an increase in popularity over the course of the pandemic, as was evident in Europe; the war in Ukraine was a climax for the far-right. 

The latest period in Europe saw the French rooting for the radical Eric Zemmour, the Swedes burning a Qur’an, the Indians discussing a ban on Hijabs, not to mention almost the entirety of the West rooting for the Azov Battalion.

The Ukraine war not only gave more prominence to what is probably the most notorious far-right organization in Europe, the Azov Battalion, but also put the latter on a pedestal as the “heroes” fighting the Russians trying to “invade” Ukraine.

Azov is a regiment of the Ukrainian Army that is infamous for its neo-Nazism, racism, nationalism, and overall violence. The battalion has been a prominent enabler in the Ukrainian campaign on the Donbass region, which has been in effect for eight years. It simply consists of shelling and bombing the region for its aspirations to become independent.

What is Azov’s significance here? It’s simple:

This image right here

Payton Gendron wearing the Black Sun, an infamous Nazi symbol

Obviously, there is more to it than one image, but this picture, before the revelation of its successors, caused netizens to conclude the nature of the Buffalo attack and the motives of the attacker.

With that in mind and the fact that Gendron’s victims were predominantly Black, the theories were no longer theories; the shooter is a Nazi, and this is why:

Screengrab from the Twitch live stream showing Payton Gendron’s AR-15

Gendron did not only commit a massacre in Buffalo, New York; he live-streamed it for the world to see, and that stream was just further proof of his Nazism.

The rifle acted as a canvas for the radical teen to fill as a means of portraying his views in a manner that reflected the racism deep-rooted within him.

Looking at the carrying handle of the rifle, one can see the number 14. 

14

The number 14 is widely used by white supremacists as a reference to the “14 Words”; the most popular white supremacist slogan coined by David Lane, a member of The Order, a white supremacist terrorist group. 

“We must secure the existence of our people and a future for white children,” the 14 words read.

The n-word

Looking at the front sight housing, one can clearly see the n-word. There is no need for introducing the infamous term coined by slave-owners to dehumanize their slaves and inherited by their white successors that still use it to discriminate against black people.

Gendron’s AR-15 rifle

From left to right, Gendron’s racism can be summarized with just a few words written down on the murder weapon.

“BLM MOGGED”

BLM is clearly in reference to the Black Lives Matter movement that gained momentum all over the world in light of widespread discrimination and police brutality. The word MOG, on the other hand, means to overpower a certain person, movement, or ideology; to “assert one’s dominance over”.

Philip Manshaus

Philip Manshaus is a 21-year-old Nazi from Norway who was indicted for terrorism and murder. He first killed his step-sister Johanne Ihle-Hansen, 17, and then opened fire at a mosque in Oslo.

His trial for terror and murder saw him spouting various racist, Islamophobic, and anti-Semitic conspiracy theories.

The only victim of his actions was his step-sister, as he was unable to hurt any of the worshippers who were at the mosque during the attempted attack.

Philip Manshaus, 21, appears to be performing the Nazi salute during his court hearing in Oslo, Norway

John Earnest

John Earnest is a 19-year-old from California who was sentenced to life plus 30 years in prison for federal hate crimes over a Synagogue shooting and attempted Mosque arson due to his extremist, white supremacist views.

He attempted to kill 50 people at the Poway Synagogue in California, US, and only managed to kill one woman and injure three others. 

Earnest also admitted that over a month before his attempted Synagogue massacre, he attempted to burn down the Dar-ul-Arqam Mosque in California, citing his hatred of Muslims and the religious character of the building.

Anders Breivik

Andres Breivik is a 43-year-old Nazi from Norway who has been in prison for more than a decade for terrorism and murder. He holds the record for the Nordic state’s worst murdering rampage, when he set off a bomb in Oslo, killing eight people.

Afterward, he headed to Utoya Island where he stalked the teen members of the Labor Party’s youth wing before murdering another 69 people.

Breivik has come to the limelight again recently after he appeared in court asking to be released on parole after serving 10 years in prison. His trial was characterized by him claiming he had left violence behind him while performing a Nazi salute.

Andres Breivik performing the Nazi salute during his parole hearing in Oslo, Norway

Shotgun shell pellets

Nazis and nationalists enable each other around the world, with one crime giving rise to another and therefore triggering a domino-like effect; one attack leads to another and gives fellow extremists inspiration to commit massacres. 

Payton Gendron was hoping to say that he was inspired by other neo-Nazis, or at least was paying homage to them, by signing their names on his rifle that he used to shoot thirteen innocent people at a supermarket.

The scenes of the live stream were heavily reminiscent of the Christchurch Mosque shootings in New Zealand. The attack was motivated by Islamophobia and the assailant, Brenton Tarrant, used similar gear, barging into two Mosques and killing 51 people performing Friday prayers. The whole crime was live-streamed using a go-pro showing the criminal’s POV of the whole massacre.

Gendron referred to the Christchurch shooter in his “manifesto”, which described his preparations for the attack in detail and made reference to several crimes perpetrated by white supremacists, including in Charleston, South Carolina, El Paso, Texas, and the aforementioned Christchurch shootings.

With the far-right being on the rise, and gun laws not getting any stricter in the US, one can only hope that innocent people remain safe from arbitrary, racially-motivated aggressions that have taken countless lives around the globe. However, western media enabling neo-Nazis and describing them as “heroes” may not be the best approach to the pivotal issue of white supremacy.

And to answer the question posed at the beginning of this piece: yes. The massacre carried out by Payton Grendon is a full-fledged hate crime, and a macro inspection of the crime would prove it to be so, objectively.

Read more – 2021 Roundup: The rise of the radical right

The Third Patriotic War

May 07, 2022

Source

A St George’s Day Contribution by Batiushka

Introduction: War

I am not a technical-military man, but I have very strong military connections and a keen interest in military history, both Russian and Western, and also in geopolitics, having lectured on it. I lived in Soviet Russia in the 1970s, experienced its weaknesses, its strengths and also its hollowness, understanding that it would eventually fall, for even then nobody believed in Communism any more. All continued by inertia. Collapse was inevitable. I also know contemporary Russia, the Ukraine, Belarus, the Baltics and Moldova very well. In fact, I was in Kiev only last October, being shown the SBU/CIA Secret Police building in the centre and being told to hush my voice as we walked past. No-one wanted to visit the torture-chambers in the basement.

The special operation to free the Russian Donbass from Fascist oppression which began on 24 February 2022 meant a war between the Russian Federation and the Kiev regime, which under Western pressure would refuse to back down. This would inevitably mean a war between Russia and NATO, even if the actual battleground would still be limited to the Ukraine. I firmly believe that the Russian government knew all this and foresaw the consequences, that the West would intervene with all the economic, political, military and technological might of the US/NATO military complex. This knowledge was why the Donbass had had to wait for liberation for eight long and grim years. Russia had had to get ready for the inevitable very carefully.

The Preparation

Let us recall how Soviet Russia fell through treason, ending up dissolving itself on 25 December 1991. In October 1993, 4,000 US Marines (I know one of them) were flown to a base outside Moscow. This was just in case the popular rising against ‘democracy’ and the drunkard Western puppet and traitor Yeltsin went Russia’s way and against the neocons and their privatisers’ ‘shock therapy’. The repression of the October bid for freedom left 5,000 Russian dead. The US support had been there, though it did not have to be used, as there were enough Russian traitors to do the dirty deed themselves.

Russian weakness and internal treachery was why the Russian government betrayed Serbia in the 1990s and Libya in 2011 – it was far too weak to stand up to the West. After the Crimea democratically returned to Russia after 60 years (1954-2014) with the internationally-observed referendum in 2014, the West still applied illegal sanctions to Russia. Then Moscow knew that any action to free the Ukraine from the Western junta in Kiev would have to be prepared very carefully, for the sanctions would only be multiplied. What preparations had to be made?

Firstly, there was the diplomatic and trade front. Allies had to be brought onside, in Eurasia with China, Iran, India, Turkey (Russia rescuing Erdogan from the US assassination attempt at the last moment in July 2016), Hungary, then, from Venezuela to Brazil, Latin America and then, from Egypt to South Africa, Africa. As regards the Western world, especially the EU, there was a chance to present the Russian point of view through RT, as at that time Western censorship was not yet total.

Secondly, there was the modernisation of the Russian Armed Forces to be undertaken, with new, non-nuclear weapons, hypersonic missiles, drones, electronic technology, some of which would be tested out in Syria.

Thirdly, there was the policy of import substitution to be implemented in order to make Russia independent in case of further illegal Western sanctions.

Why Did It Start on 24 February 2022?

There were four triggers which sparked off the special operation on 24 February.

Firstly, the Zelensky regime wanted the Ukraine to become a NATO member. The weak post-Communist Russian Federation had already made that mistake many times, allowing Eastern Europe, notably the Baltics, Poland and Romania, to join that aggressive protection racket. In that way the post-War buffer states of Eastern Europe, providing a demilitarised zone for Russia, ended. After all, if you have been invaded from the West very regularly for 800 years, leaving 27 million of your citizens dead in the most recent invasion, would you not also want a demilitarised buffer zone to protect you? Post-War offensive NATO was the only reason why the defensive Warsaw Pact had to be set up.

Secondly, with missiles on American bases in Poland and Romania and NATO troops smugly parading at the Estonian border with Russia, the Ukraine then threatened to obtain nuclear arms. Did Zelensky, reading his American script as a true actor, really expect Russia not to react to this?

Thirdly, the US, not without the help of its local pronconsul, the cocaine-addled Hunter Biden, had set up some thirty biolabs in the Ukraine. Their target? To find genetically-concocted viruses to infect Russians. Would Russia not defend itself?

Fourthly, though possibly this may not have been discovered by Russia until a day or two after the special operation began, though possibly they knew perfectly well beforehand, the NATO-manipulated, instructed and armed Kiev Army had a plan to invade the Russian Donbass and genocide its people. Had they succeeded, it is doubtful they would have stopped at the Russian border. Truss, the supremely stupid British Foreign Secretary, let slip that NATO already had Russian Rostov and Voronezh in its sights.

After eight years of attempts to negotiate, which Russia used to buy time to prepare for the War in case of Western idiocy, it was only because there was no alternative that it sent in some troops in an initially limited military operation.

A Fight for Survival

This is now a war of attrition. Russia has to destroy all Western/NATO arms and troops that get into the Ukraine from Poland or elsewhere as soon as possible, quicker than they can be sent. And this must go on until the West caves in, because so much Western war material will have been destroyed at huge financial loss to itself.

Russia is also relying on the self-imposed economic problems that the West faces. The West, and not just the EU, is already suffering economically. There could easily be popular uprisings as a result of inflation and the incredible cost of energy. This will hit very hard next autumn and winter. And the embargos on Russian grain and fertilisers have not hit yet. Wait till food costs go up by 100% in Western countries, instead of just going up by 10% as now: then you will have rioting in the streets and looting of supermarkets. As for the Ukrainian currency, it is worthless, propped up by the IMF run by the US, which in 2014 stole the $15 billion of Ukrainian gold reserves in expectation. Otherwise, the Ukraine would long ago have defaulted.

The stakes are huge for all. China stands behind Russia because Russia is like a shield for it. If Russia falls, then China is next and it knows that, which is why it supports Russia. The White Peril will next head towards China, making the British-imposed mass suicide of the so-called ‘Opium Wars’ look like a picnic. There will be no taking back of Taiwan in the near future, instead there will be Harvard economists and merchant bankers taking power and grasping billions in Beijing, as in Russia after 1991. And then, amid civil wars, millions and millions of Chinese will take the path of suicide, exactly as happened in 1990s Russia. Make no mistake, this is a battle for survival of the world’s seven billion against the one billion.

This is why today Russia remains firm, with 80% of the population behind President Putin, unlike in the Western world where it is rare to find a leader who has more than 30% of support. Why? It is simple: President Putin loves his country, he is a patriot: Western leaders are not patriots, they are venal mercenaries, no more so than the US puppet governments in Eastern Europe. The only Russians against President Putin are the traitors, recruited by the CIA, and there are still quite a few in Moscow and elsewhere, but we will not here name names.

True, many of the fifth column of traitors in Moscow have already left or are leaving, Tel Aviv being a popular destination for them. For Russia this is not some localised conflict on its borders, as it still appears to most Western people, lulled into delusions by their Goebbels propaganda ministries (‘media’). For Russia this is just as much a fight for survival as World War Two. This is the Third Great Patriotic War. Let me explain.

For those who do not know, the 1812 invasion of Russia by Napoleon and his multinational barbarian hordes is known as the First Patriotic War. The 1941 invasion by Hitler and his multinational barbarian hordes is known as the Second Patriotic War. It is our view that just as the 1941-1945 defensive War was called the Second Patriotic War, the 2022- ? defensive War will be known as the Third Patriotic War. Warsaw and Bucharest, Berlin and Paris, pay attention.

When Did It All Begin?

When did it all begin? Actually, it was not on 24 February 2022. Some, grudgingly, will admit that it was the US-run regime change of 2014 with its $5 billion price-tag for the hapless US taxpayer. Grudgingly, some might admit that it goes back even further to November 1989, the Fall of the Wall. Some might suggest two generations before that, in September 1939, when Stalin took the poison-chalice of the western Ukraine, Galicia, from Poland and had to fight a CIA-supplied war there against Fascist partisans until 1958.

Some might suggest exactly 100 years ago in 1922, when the brain-syphilitic Lenin transferred from Russia the southern and eastern half of the present Ukraine to the Ukraine, as he wanted the pro-Communist industrial proletariat of the south and east to counterbalance the real Ukrainian agricultural north and west. But we could also go back to 1914, the invasion of the Russian Empire by Germany, Austria-Hungary and Turkey. This is exactly 100 years before the 2014 US-orchestrated colour-revolution in Kiev, with its Lithuanian snipers on the roof of the American Embassy in Kiev murdering Ukrainian policemen and then the US blaming ‘repression’ on the democratically-elected pro-Russian government.

Conclusion: A Fight to the End

Russia must win this War against NATO. However, the last thing Russia wants is a nuclear war, however much some fools in the West talk that up. And however tempting as targets the 1,000 or so US bases around the world may be, Russia certainly does not want the war to spread outside the current Ukrainian territory. If Russia does not win, the Russian Federation will be humiliated and dismantled and become just another group of colonies for Western asset-strippers and slavers. Then the British dream for its 1917 coup d’etat, turned into a nightmare because the stupid dream permitted Bolshevism to come to power, will become real.

After that, China will fall next and then the rest of the still free, if for the moment impoverished and exploited, world will fall just like dominos into neo-colonial Western hands. And that will be the end of the world under a US Global Dictatorship, euphemistically known as ‘the Unipolar World’. We are not ready for that. We prefer to fight. As President Putin has said, a world without Russia is not one we wish to live in. As we have said before, this is our ONLY chance to work towards a Union of Sovereign (NOT Soviet) Social (NOT Socialist) Republics and an Alliance of countries which favour Prosperity and Justice, not Poverty and Injustice.

Russian Orthodox St George’s Day 2022

Terror from Balochistan: a menacing tool to disrupt Sino-Pakistani economics

A Baloch suicide bombing targeting Chinese workers in Karachi comes a mere month after the US-backed ousting of PM Imran Khan. Pakistan is a critical BRI hub in Beijing’s vast Eurasian connectivity project, and it looks like CPEC is the ultimate target of this disruption.

May 05 2022

Balochistan can only benefit from Chinese infrastructure investment in the immensely impoverished Pakistani province. But an uptick in attacks on Chinese workers by militant separatists suggests that external agendas may be in play. Photo Credit: The Cradle

By Pepe Escobar

This is the concise story of how a suicide bombing may carry the potential to subvert the whole, ongoing, complex process of Eurasia integration.

Recently, the Balochistan Liberation Movement (BLA) had released an ISIS-influenced video threatening “Chinese officials and installations” in Pakistan’s vast province.

Yet what actually happened in late April was a suicide bombing outside of the University of Karachi’s Confucius Institute – not Balochistan – and targeting Chinese teachers, not “officials and installations.”

The suicide bomber was a woman, Shaari Baloch, alias Bramsh, who detonated her vest just as a van carrying Institute staff members approached the entrance. The attack was claimed by the BLA’s Majeed Brigade, which stressed that this was the first time they used a female suicide bomber.

Shaari Baloch was a schoolteacher with a Zoology degree, enrolled to pursue a second Master’s degree, married to a dentist and professor at Makran Medical College in her hometown of Turbat, in southern Balochistan. Her three brothers include a doctor, a deputy director at a government-funded project, and a civil servant. So Shaari Baloch was far from being a mere destitute online-indoctrinated Salafi-jihadi.

The Pakistani Foreign Office had to stress the obvious: this was a “direct attack on the Pakistan-China friendship and ongoing cooperation,” always qualified, by both sides, as “iron brothers.” Pakistan is an absolutely key node of the Chinese Belt and Road Initiative (BRI) to connect the Eurasian landmass.

This was no standard terrorist attack. Its reverberations are immense – not only in one of Pakistan’s provinces and South Asia regionally, but for the whole of Eurasia. It may be a harbinger of serious turbulence ahead.

Shaari Baloch’s act of desperation should be seen, to start with, as the embodiment of a deep-seated Baloch alienation felt by the educated middle classes, from lawyers and traders to students, constantly permeating the complex relationship with a distant Islamabad. A significant part of the puzzle is that 26 Pakistani intel agencies never saw it coming.

Baloch leaders instantly made the point that the best possible reaction would be to call a Grand Jirga – modeled on the Shahi Jirga practiced at the time of the partition of the subcontinent – that would unite all tribal elders to address the most pressing local grievances.

Round up the usual suspects

Balochistan, geostrategically, is as valuable as rare earth minerals: an immense desert positioned east of Iran, south of Afghanistan, and boasting three Arabian Sea ports, including Gwadar, practically at the mouth of the strategic Strait of Hormuz.

Comprising nearly 48 percent of Pakistan’s area, Balochistan is rich in uranium and copper, potentially very rich in oil, produces more than one-third of Pakistan’s natural gas, and sparsely populated. The Baloch account for the majority of the population, followed by Pashtuns. Quetta, the large provincial capital, for years was considered Taliban Central by the Pentagon.

Gwadar, the port built by China on the southwestern Balochistan coast of the Arabian Sea – directly across from Oman – is the absolute key node of the China-Pakistan Economic Corridor (CPEC), and doubles as the essential link in a never-ending pipeline saga. The Iran-Pakistan-India (IPI) gas pipeline, previously known as the “peace pipeline,” with plans to cross from Iranian to Pakistani Balochistan (India still has not made up its mind) is absolute anathema to Washington since the George W. Bush era.

CPEC remains an endless source of controversy even inside Pakistan. Beyond all the links planned between Gwadar and Xinjiang by the year 2030, most of this ambitious connectivity corridor deals with energy, industrial zones and road and rail projects in different parts of the country – an overall improvement of its lagging infrastructure. The Chinese, for years, have quipped that in fact “all of Pakistan is a corridor.”

The US security establishment, predictably, has been planning for years to instrumentalize an insurgency in Balochistan to – what else – “disrupt” first the possibility of an energy pipeline from Gwadar to Xinjiang, and then the overall CPEC project. Usual suspects like the US’s National Endowment for Democracy (NED) are very much present in Balochistan. WikiLeaks had revealed a great deal of the game back in 2015.

A Carnegie Institute report noted how “many Baloch nationalist leaders now come from the urbanized districts of Kech, Panjgur, and Gwadar (and to a lesser extent from Quetta, Khuzdar, Turbat, Kharan, and Lasbela). They are well connected to Karachi and Gulf cities, where tribal structures are non-existent. In fact, while there is violence all over the province, the insurgency seems to concentrate mainly in these urbanized areas.”

Suicide bomber Shaari Baloch came from Turbat, the province’s second largest city, where the BLA is very much active. From the point of view of the usual suspects, these are choice assets, especially after the death of important tribal leaders such as Akbar Bugti. The report duly noted how “the educated and middle-class Baloch youth are in the forefront” of the insurgency.

The anti-China instrumentalization of the BLA also ties in with the regime-change parliament operation in Islamabad that recently deposed former prime minister Imran Khan, who was always a fierce adversary of the American “Forever War” in Afghanistan. Khan resolutely denied Pakistan’s use in “over the horizon” US military ops: that was one of the key reasons for him to be ousted.

Now, with a pliant, Washington-approved, new regime in town, a miracle has just happened: the Pentagon is about to clinch a formal agreement with Islamabad to use Pakistani airspace to – what else – keep interfering in Afghanistan.

Beijing, as well as other members of the Shanghai Cooperation Organization (SCO), won’t be amused. Only weeks before the white coup, Khan had met with Chinese President Xi Jinping and once again underscored how Pakistan and China are “iron brothers.”

Imran Khan was a serious thorn in the side of the west because he kept impressing on Pakistanis that the Forever War in Afghanistan was militarily unwinnable. He knew how all the proxies – including the BLA – that destabilized both Afghanistan and Pakistan for decades were, and continue to be, part of US covert operations.

Not an Iran-India plot

Balochistan is as deeply tribal as the Pashtun tribal areas. Local tribal chiefs can be as ultra-conservative as Islamabad is neglectful (and they are not exactly paragons of human rights either). Most tribes though bow to Islamabad’s authority – except, first and foremost, the Bugti.

And then there’s the Balochistan Liberation Army (BLA), which both Washington and London used to brand as a terrorist group, and then forgot about it. The BLA operated for years out of Kandahar in Afghanistan (only two hours away from Quetta), and already in the previous decade – simultaneous to the announcement of the New Silk Roads and CPEC – stressed it was getting ready to attack non-Balochis (code for the government in Islamabad as well as Chinese foreigners).

Balochis are inclined to consider the BLA as a resistance group. But Islamabad has always denied it, saying their support is not beyond 10 percent of the provincial population.

An ample controversy has raged in Pakistan for years on whether the BLA was totally hijacked by the CIA, the MI6 and the Mossad. During a 2006 visit to Iran, I was prevented from going to the Sistan-Balochistan province in southeast Iran because, according to Tehran’s version, infiltrated CIA from Pakistani Balochistan were involved in covert, cross-border attacks. It was no secret to anyone in the region that since 9/11 the US virtually controlled the Baloch air bases in Dalbandin and Panjgur.

In October 2001, while waiting for an opening to cross to Kandahar from Quetta, I spent quite some time with a number of BLA associates and sympathizers. They described themselves as “progressive, nationalist, anti-imperialist” (and that would make them difficult to be co-opted by the US). They were heavily critical of “Punjabi chauvinism,” and always insisted the region’s resources belong to Balochis first; that was their rationale for attacks on gas pipelines.

Stressing an atrocious, provincial literacy rate of only 16 percent (“It’s government policy to keep Balochistan backward”), they resented the fact that most people still lacked drinking water. They claimed support from at least 70 percent of the Baloch population (“Whenever the BLA fires a rocket, it’s the talk of the bazaars”). They also claimed to be united, and in coordination with Iranian Balochis. And they insisted that “Pakistan had turned Balochistan into a US cantonment, which affected a lot the relationship between the Afghan and Baloch peoples.”

Two decades later, and after the whole ISIS saga in Syria and Iraq, it’s a completely different story. BLA sympathizers may still be prepared to remain within a Pakistani confederation, although with infinitely more autonomy. But now they seem to be willing to use western imperial help to strike not only at the central government in Islamabad, but also at the “near abroad” foreign profiteer (China).

After the Karachi suicide bombing, a narrative started to emerge in some Pakistani circles that Iran and India were in cahoots to destabilize Balochistan.

That makes absolutely no sense. Both Tehran and Islamabad are tightly linked to Beijing through several nodes of the New Silk Roads. Iran would draw less than zero benefit to collude with India to destabilize an area that borders Afghanistan, especially when the SCO is fully engaged in incorporating Kabul into the Eurasia integration process. Moreover, the IPI has its best chances ever to come to fruition in the near future, consolidating an umbilical cord from Southwest Asia to South Asia.

During the late years of Barack Obama’s administration, the BLA, though still a fringe group with a political wing and a military wing, was regrouping and rearming, while the chief minister of Balochistan, Nawab Raisani, was suspected of being a CIA asset (there was no conclusive proof).

Already at the time, the fear in Islamabad was that the government had taken its eye off the Balochistan ball – and that the BLA was about to be effectively used by the US for balkanization purposes. That seems to be the picture right now. Yet the heart of the matter – glaringly expressed by the Karachi suicide bombing – is that Islamabad still remains impervious to the key Baloch grievance: we want to profit from our natural wealth, and we want autonomy.

The views expressed in this article do not necessarily reflect those of The Cradle.

Michael Hudson, Katie Halper and Aaron Maté: UPDATE

May 03, 2022

Michael starts at 23:40 and the transcript will be added to this thread when available.

UPDATE:  Free part of Transcript:

Katie Halper podcast, April 29, 2022

UI: Michael Hudson Free Podcast

Date: 4/29/22 Length: 24:55

 TRANSCRIPT

KATIE HALPER: Professor Michael Hudson, thank you so much for joining us. We’re really excited to have you.

We wanted to start off by asking you if you could provide an overview of what the economics driving this conflict are—and by conflict, I mean the conflict between Russia and Ukraine, and, of course, with the rest of the world, or really the conflict between Russia and US, and the economic fallout.

MICHAEL HUDSON: Well, it depends on what side you’re looking at. From the Russian side, I don’t think the economic factors were primary. They were threatened by NATO’s expansion and really a plan to attack the Russian-speaking areas of Ukraine. So, I think Russia’s calculations were simply military. The West’s calculations were quite different.

And if you looked at what the results of the conflict are, you have to assume that everybody was talking about the results [as] were known. They’re very clear. The results are a very large increase in fuel prices, oil, and energy prices, a very large increase in agricultural prices with declining supplies. This will leave most of Africa and Latin America—third-world countries, the Global South—unable to pay their foreign debts, which is going to result either in a massive debt default or it will result in a debt repudiation.

Countries are going to have to choose. Are they going to have to operate their homes without energy, their factories without energy—and energy consumption per capita is directly connected to GDP for the last 150 years. Every chart shows energy use, GDP, and personal income go up together.

So, what are countries going to do when they can’t afford to pay the higher prices for energy? Well, Janet Yellen, who was the Federal Reserve head and [now] the Secretary of the Treasury says, ‘Well, what we’re going to do is use the International Monetary Fund to preserve America’s unipolar hegemony.’ I think she used almost those words. We have to keep American control of the world and we’re going to do it through the IMF. And that means in practice using the IMF to create special drawing rights, which will be sort of like free money, the bulk of which will go to the United States to support its military spending abroad for all of this huge military escalation. And it will enable the IMF to go to countries and say, ‘We will help you pay your debts and not be foreclosed on and get energy, but it’s conditional.’ On usual conditions: you have to lower your wages; you have to pass anti-labor legislation; you have to agree to begin selling off your public domain and privatize.

The energy and food crisis caused by the NATO war against Russia is going to be used as a lever not only to push privatization, largely under control of US investors and banks and financiers, but it’s also going to lock countries into the US orbit all the more, both the Global South and especially Europe.

One casualty is obviously going to be Europe and the euro. The euro has been plunging in value day after day after day, as people realize that it’s lost its export markets in Russia and much of Asia, and now at home, too, because exports require energy to be made. Its costs of imports are going up, especially energy. It’s agreed to use, I think, now $3 billion to build new port facilities to buy US natural gas—liquified natural gas at three to seven times the price that it’s paying now, which will make it almost impossible for German firms to produce fertilizer to grow crops in Germany. The euro’s plunging.

The largest plunge of all has been the Japanese yen, because Japan imports all of its energy and most of its food and is keeping its interest rates very low in order to support the financial sector. And so, the Japanese economy is being sacrificed and squeezed. And I think this is…you can’t say, ‘Gee, this is an accident.’ This is part of the plan, because now the United States can say, ‘Of course we don’t want your yen to go down so much that your consumers have to pay more. We will, of course, give you SDRs—special drawing rights—and we will give you American aid. But we do want you to rewrite your constitution so that you can have atomic weapons on your soil so that we can fight against China to the last Japanese. Just like we’re doing in Ukraine, let us do it for you.’

And, of course, the Japanese love that. The government loves that idea. They love sacrificing the population, which is what they’ve been doing ever since the Plaza Accord and the Louvre Accord of the 1980s that basically wrecked the Japanese industrial economy from this huge upswing to just a mass shrinkage.

So, those are the economic effects of the war. And in the newspaper, you think the war is all about Ukrainians and NATO fighting Russians, and it’s really a war by the United States to use the NATO-Russia conflict as a means of locking in control over its allies and the whole Western world, and in Janet Yellen’s words, re-establishing American unipolar power.

AARON MATÉ: And do you think that, assuming that this is the US strategy, taking your argument at face value, do you think that this strategy will succeed?

MICHAEL HUDSON: Ultimately, it’ll be self-defeating. And almost every US politician and military speech has the phrase, ‘Gee, we don’t want America to shoot itself.’ And obviously they’re all worried about it. It’s a huge gamble.

Apparently, the military was not even consulted in the sanctions that were put against Russian energy. And the military wasn’t consulted even on the plans by the State Department and the National Security…the neo-cons that are running the NATO war. And so, obviously, there’s a lot of doubts within the military, but they don’t speak up—that’s not what they do.

It’s amazing that in Europe the only opposition to this is coming from the right wing, people like Marine Le Pen. Not from the left wing. So, the left wing in Europe…I shouldn’t say the left, I should say what is now the right wing, the Social Democratic parties, the Labour Party, those are the parties that are thoroughly behind NATO. And there doesn’t seem to be a political imperative in these countries, except going along with the policy that’s going to squeeze their balance of payments and lock them into dependency on the United States.

So, what seems to be happening if there’s no fight back on the part of Europe? Obviously, if you look at the United Nations vote on whether to come out with a policy against Russia, many countries either abstained or voted against it. So, the big economic result is structural. It means there’s like an iron curtain between the white Western world (Europe and North America) and Eurasia (China, India, and Russia, and their surrounding territories). And if you have China, India and Russia—or what [Halford John] Mackinder called Eurasia, the world core—then, are you going to have the rest of Asia coming along? The question’s going to be, what happens with Taiwan, Japan, and North Korea? They’re pretty much up for grabs. And yet two days ago, the NATO leader, [Jens] Stoltenberg, said NATO has to have a presence in the South China sea, that NATO has to defend Europe in the Pacific, in China. So, you can see the conflict that’s coming there. And I think you also had one of the NATO people—a European politician, negotiator—saying this war cannot be settled economically. It cannot be settled by treaty. It can only be settled militarily.

Well, so then you’re back to, how is the military going to affect the economy? Well, Russia cannot afford to lose, because if it loses, NATO is going to put atomic weapons right in Ukraine, right next to its border, as it wants to do in Latvia and Estonia. And the US, apparently, is taking a position, ‘We can’t lose, because if we lose, Biden won’t be reelected.’ And Biden apparently is now running the military and economic campaign with a view towards how can he be reelected in November [2024]—with the only real variable in the American strategy being the American public itself, which, unfortunately, there’s almost no discussion of what we’re talking about today, except your show, the internet, [The Vineyard of] The Saker and the others. So, everything is up for grabs.

AARON MATÉ: And by the way, if this is Biden thinking, he’s doing so, even though most Americans don’t wake up caring about Ukraine, it’s not their top concern. But there’s a very different attitude inside the White House. Obviously, they do.

So, let me ask you about Russia. Can Russia afford to weather all of this? As we’re speaking, Russia has recently cut off gas deliveries to Poland and Bulgaria. Let’s say other parts of Europe follow suit and refuse to pay in rubles for gas payments, as Putin has demanded. Can Russia afford to cut off more countries from receiving Russian energy, or is Putin bluffing there, do you think?

MICHAEL HUDSON: No, of course it can afford to cut it off because Russia is pretty much self-contained. It’s how it survived the 1990s and the shock therapy. Any country that could survive the shock therapy, nothing is going to be that serious again. So, it’s already shown that it can survive, 20 years ago, 30 years ago. And it can survive much better than Europe can survive.

AARON MATÉ: Michael, let me push back there. It survived, but the 90s took a very heavy toll on Russia.

MICHAEL HUDSON: Yes, it did. Absolutely.

AARON MATÉ: Are you suggesting that Russia might face that again?

MICHAEL HUDSON: No, I don’t think it’ll be that serious again, because now it has the support of China, India, and other countries. Before it was completely dismantled from within. Now, it’s not dismantled from within. It’s rebuilt; certainly, it’s military. It’s rebuilt enough of its economy and made enough links with other economies who are politically supporting it. Because Biden has said again and again, ‘We’ve got to destroy Russia because if we destroy Russia, we will cut it off in China, and then we can go against China as our real enemy.’ So, we’ve got to cut up the world potentially opposing us, first Russia and then China, maybe India, too. And he’s been very explicit in this, so you can imagine where this leaves China and India. India has already said, ‘Well, look, we’re economically linked to Russia. We’re going to continue to link.’

Russia’s foreign reserves were stolen in the West. It’s going to basically work with China to create some kind of mutual currency swaps like United States arranges with Europe and other countries—currency swaps so that they can hold each other’s currency. And China knows that, ultimately, it will be repaid through a new pipeline to deliver gas to China. So, I think a decision has been made in Russia that it’s decoupling with the West. Certainly, decoupling from Europe, decoupling from the United States, except for marginal trade, and [from] reorienting itself towards the West because it can’t afford to deal on these terms anymore.

So, yes, it’s going to be painful. But I think the Russian people, who get a very different report of the war and the violence and terrorism that’s going on than the American press [gives], the Russians seem to be 80% behind Putin. It’s not like it was in the 90s when they were utterly demoralized.

The military fighting is not going to end this year or next year. It’s going to take at least 30 years. And it will end probably with a split between Europe and the West on the one hand and Eurasia on the other hand, with more and more of Africa and South America linking itself to the Eurasian economy as Europe and the American economies shrink.

Almost everyone sees shrinkage. I think President Xi of China said the other day, he sees that the American economy is shrinking, and certainly the European economy is shrinking, for a decade or as long as it continues the neoliberal course. And I think that’s pretty obvious—it’s going to shrink. And Xi also said that’s because a centrally planned economy, which they call socialism or Marxism with Chinese characteristics, is more efficient than democracy, because democracy really turns into oligarchy very quickly, and the oligarchy turns into a hereditary aristocracy.

And the West is not a democracy anymore. The West is turning into a hereditary aristocracy. And the Chinese are trying to prevent the financial class from becoming an independent class, pursuing policies that impoverish labor, because for them banking and credit is still a public utility. That’s the most important sector to be [saved] in China, and that’s what makes China so different from the United States. You could say that bankers and Wall Street are the central planners of the US, and their central planning is in favor of the finance, insurance, and real estate sector, and bankers are in charge of China through the Treasury, which is run by party officials that are not seeking to make capital gains for wealthy families but are using finance to build up their industry and infrastructure and make themselves independent of the West, so that America can never do to China what it did to Russia.

AARON MATÉ: And if you were to predict the first places where we’re going to see a major fallout, major unrest as a result of higher commodity prices due to this war on Ukraine, where will it be?

MICHAEL HUDSON: I would say Latin America, Africa, third-world countries that have not followed World Bank policy for the last 70 years and not produced their own food, but produce the export crops, so they’re dependent on importing food, primarily American grain and importing American energy. And probably the central economic game of the NATO war against Russia was to reconcentrate control of the world energy trade in the hands of American, English, and Dutch oil companies.

So, basically the oil companies and the US are going to let the third-world countries go into a crisis. If they default on their bonds, then the United States and the bondholders get to treat Latin America like they treated Argentina or Venezuela and grab whatever assets they have outside of their country. Like Venezuela had investments in the United States and gold that it left in the Bank of England that were grabbed.

There’s going to be a huge asset grab. That is supposed to be how this unfolds, and the most obvious assets to the grabbed are going to be in Latin America and Africa. Maybe some Asian deficit countries. So, this is the weakest link, and that’s why there’s this fight within the IMF at the upcoming meetings, to create these special drawing rights to give them money on the condition that there is a class war.

So, what we’re seeing, really, isn’t a war between NATO and Russia. It’s a class war of the neoliberals against labor across the world to establish the power of finance over labor.

AARON MATÉ: And so, do you think that there’s a threat of an even worse hunger crisis in this world, one that we’re not talking about and should be preparing for it?

MICHAEL HUDSON: A threat? That’s the objective! Yes, of course. That’s what they’re aiming at. If you read what Klaus Schwab says at the World Economic Forum, he said there are 20 percent too many people in the world, especially in the Global South. This is what all the big foundations are for. The billionaires, they all say, ‘We’ve got to thin out the population, there’s too many consumers that don’t produce enough wealth for us.’ If they produce wealth for themselves, that doesn’t count because that’s not for us and we don’t get it. So, yes, that’s not going to be an accident. Obviously, anyone who looks at the basic economic trends can see that this is inevitable—and you have to assume that this was discussed as part of the whole big neoliberal plan of the Biden administration and the Deep State behind it.

KATIE HALPER: How different is this from what we saw with Trump, how continuous, or how much of an aberration do we have between the different administrations?

MICHAEL HUDSON: It’s pretty much the same. The same groups are still in control. Trump was going to appoint that general who was going to basically clean out the State Department and the CIA, but his son-in-law convinced them not to appoint this person. And Trump didn’t have anyone in his administration able to close down this whole neocon group there. So, basically, he let them destroy, essentially. They just ignored what he did. He wanted to withdraw troops from Syria and the Army just refused to withdraw the troops. Nobody followed his orders. So, he was an aberration politically, but the presidency of the US these days is pretty much a figurehead for the Deep State behind it. So, I don’t think there’s that much difference. The Republicans are as much behind this plan as the Democrats.

AARON MATÉ: Let me ask you about the economic toll on Ukraine from this conflict, and not just from Russia’s invasion, but the last eight years since the US-backed coup. And maybe we can start with what happened in the fall of 2013, because the conventional story that we get told a lot in the US is that basically this whole crisis began when Ukraine was in talks with the EU under Yanukovych, the ousted president. And Yanukovych was going to sign this agreement with the EU and that’s what most Ukrainians wanted. It would have brought liberty to Ukraine, and then Russia basically sabotaged it and ordered him not to. And that’s when Ukrainians came out to protest…

KATIE HALPER: This is not…you’re not saying this, Aaron, right? You’re saying this is the mainstream narrative that we’ve been fed.

AARON MATÉ: Yes, this is the mainstream narrative that we’ve been fed. And so that’s when Ukrainians came out to protest with the Maidan revolution, as it’s called, and that’s what led to the coup in February of 2014 that ousted Yanukovych.

Can you talk about what that narrative gets wrong, especially the actual terms of the agreements that Yanukovych was being asked to sign by the EU and what that would’ve meant for Ukraine?

MICHAEL HUDSON: Well, Russia couldn’t really tell Yanukovych what to do. Yanukovych was always independent. Russia offered a better deal, and Yanukovych said the deal that the EU was offering would make it much poorer than the continuation of the relationships that it had with Russia, which, after all, were its traditional relationships. So, Yanukovych didn’t sign the EU deals. And at that point, it wasn’t the Ukrainians that protested. It was a neo-Nazi group that was positioned in…that set itself up with snipers all around Maidan square, and it was the Nazi group that began firing on the policemen to make it appear as if it were the government, and to fire on the general crowd. So, basically, the coup was sponsored by the United States who put in the officials that were designated by Ms. Nuland, and the Ukrainians had hoped that somehow joining the EU would make them prosperous. Well, that’s the myth that Europe had, that if it would only take US advice, it would end up as prosperous with as many consumer goods as the United States. And it was all a myth.

But when Yanukovych’s board looked at it, they said, ‘Well, we’re not going to make money this way, basically.’ And the kleptocrats who were running Ukraine at that time…the Ukrainians weren’t running Ukraine. It was considered by the World Bank, every agency, to be the most corrupt country in Europe, and the kleptocrats thought, ‘Wait a minute. If we sign that then the Europeans are going to take over our property and they’re going to want to buy us out, and we’re going to end up with some yachts and some real estate in England like the Russians. But it’s really going to be a giveaway.’ So, they were certainly behind Yanukovych, saying, ‘This is not a good deal with this.’

That’s when the US decided that it needed a coup, and even at that time it wanted…it realized that it had the idea of long-term fighting against Russia as the first domino to fall in the fight against China. That was already in the discussion already at that time in 2014.

AARON MATÉ: Right. Carl Gershman is the former head of the National Endowment for Democracy. He called Ukraine, quote, “The biggest prize,” and what he saw as a struggle against Russia, he thought that actually bringing Ukraine into the Western orbit would actually lead to regime change even in Russia, and lead to Vladimir Putin’s downfall.

MICHAEL HUDSON: Well, he was a Trotskyist, a neocon, and a virulent Russia-hater.

KATIE HALPER: An example of that great Trotskyist-to-neocon trajectory that we see so much.

MICHAEL HUDSON: Yeah.

AARON MATÉ: One small point though. I think the protest that happened initially against Yanukovych, I think that was actually a large mass of people. That wasn’t neo-Nazi. I think the neo-Nazi…

MICHAEL HUDSON: Right. But they didn’t do the coup. They weren’t behind the coup.

AARON MATÉ: The coup was definitely the far-right, as they’ve even taken credit for—as they even take credit for, openly.

You mentioned the kleptocrats in Russia. Let me ask you about that. What is the real state of the oligarchy in Russia? We hear in the US constantly about the Russian oligarchs, and they’re sort of blamed for all the world’s ills. What is the actual reality of Russian oligarchs? How has that evolved under Putin? This oligarch class was obviously created under [Boris] Yeltsin with the advice of US technocrats who came in. What is the actual power of the oligarchs in Russia now, and their relationship with Vladimir Putin?

[To hear the rest of the interview, please go to UsefulIdiots.substack.com.]

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Professor Hudson’s new book is also in publication now and available on Amazon.  We will soon publish a book review for the Saker Blog and in my reading so far, I am totally impressed with the quality and clarity.

‘Rublegas:’ the world’s new resource-based reserve currency

The Russian ruble is sitting pretty right now, having regained its pre-sanctions value and set to become a major commodity currency.

April 01 2022

Photo Credit: The Cradle

Rublegas is the commodity currency du jour and it isn’t nearly as complicated as NATO pretends. If Europe wants gas, all it needs to do is send its Euros to a Russian account inside Russia.

By Pepe Escobar

Saddam, Gaddafi, Iran, Venezuela – they all tried but couldn’t do it. But Russia is on a different level altogether.

The beauty of the game-changing, gas-for-rubles, geoeconomic jujitsu applied by Moscow is its stark simplicity.

Russian President Vladimir Putin’s presidential decree on new payment terms for energy products, predictably, was misunderstood by the collective west. The Russian government is not exactly demanding straightforward payment for gas in rubles. What Moscow wants is to be paid at Gazprombank in Russia, in its currency of choice, and not at a Gazprom account in any banking institution in western capitals.

That’s the essence of less-is-more sophistication. Gazprombank will sell the foreign currency – dollars or euros – deposited by their customers on the Moscow Stock Exchange and credit it to different accounts in rubles within Gazprombank.

What this means in practice is that foreign currency should be sent directly to Russia, and not accumulated in a foreign bank – where it can easily be held hostage, or frozen, for that matter.

All these transactions from now on should be transferred to a Russian jurisdiction – thus eliminating the risk of payments being interrupted or outright blocked.

It’s no wonder the subservient European Union (EU) apparatus – actively engaged in destroying their own national economies on behalf of Washington’s interests – is intellectually unequipped to understand the complex matter of exchanging euros into rubles.

Gazprom made things easier this Friday, sending official notifications to its counterparts in the west and Japan.

Putin himself was forced to explain in writing to German Chancellor Olaf Scholz how it all works.

Once again, very simple: Customers open an account with Gazprombank in Russia. Payments are made in foreign currency – dollars or euros – converted into rubles according to the current exchange rate, and transferred to different Gazprom accounts.

Thus it is 100 percent guaranteed that Gazprom will be paid.

That’s in stark contrast to what the United States was forcing the Europeans to do: pay for Russian gas in Gazprom accounts in Europe, which would then be instantly frozen. These accounts would only be unblocked with the end of Operation Z, Russia’s military ops in Ukraine.

Yet the Americans want the war to go on indefinitely, to “bog down” Moscow as if this was Afghanistan in the 1980s, and have strictly forbidden the Ukrainian Comedian in front of a green screen somewhere – certainly not Kiev – to accept any ceasefire or peace deal.

So Gazprom accounts in Europe would continue to be frozen.

As Scholz was still trying to understand the obvious, his economic minions went berserk, floating the idea of nationalizing Gazprom’s subsidiaries – Gazprom Germania and Wingas – in case Russia decides to halt the gas flow.

This is ridiculous. It’s as if Berlin functionaries believe that Gazprom subsidiaries produce natural gas in centrally heated offices across Germany.

The new rubles-for-gas mechanism does not in any way violate existing contracts. Yet, as Putin warned, existing contracts may indeed be stopped: “If such [ruble] payments are not made, we will consider this to be the buyers’ failure to perform commitments with all ensuing implications.”

Kremlin spokesman Dmitri Peskov was adamant that the mechanism will not be reversed under the current, dire circumstances. Still that does not mean that the gas flow would be instantly cut off. Payment in rubles will be expected from ‘The Unfriendlies’ – a list of hostile states that includes mostly the US, Canada, Japan and the EU – in the second half of April and early May.

For the overwhelming majority of the Global South, the overarching Big Picture is crystal clear: an Atlanticist oligarchy is refusing to buy the Russian gas essential to the wellbeing of the population of Europe, while fully engaged in the weaponization of toxic inflation rates against the same population.

Beyond Rublegas

This gas-for-rubles mechanism – call it Rublegas – is just the first concrete building block in the construction of an alternative financial/monetary system, in tandem with many other mechanisms: ruble-rupee trade; the Saudi petroyuan; the Iran-Russia SWIFT- bypassing mechanism; and the most important of all, the China-Eurasia Economic Union (EAEU) design of a comprehensive financial/monetary system, with the first draft to be presented in the next few days.

And all of the above is directly linked to the stunning emergence of the ruble as a new, resource-based reserve currency.

After the predictable initial stages of denial, the EU – actually, Germany – must face reality. The EU depends on steady supplies of Russian gas (40 percent) and oil (25 percent). The sanction hysteria has already engineered certified blowback.

Natural gas accounts for 50 percent of the needs of Germany’s chemical and pharmaceutical industries. There’s no feasible replacement, be it from Algeria, Norway, Qatar or Turkmenistan. Germany is the EU’s industrial powerhouse. Only Russian gas is capable of keeping the German – and European – industrial base humming and at very affordable prices in case of long-term contracts.

Disrupt this set up and you have horrifying turbulence across the EU and beyond.

The inimitable Andrei Martyanov has summed it up this way: “Only two things define the world: the actual physical economy, and military power, which is its first derivative. Everything else are derivatives but you cannot live on derivatives.”

The American turbo-capitalist casino believes its own derivative “narrative” – which has nothing to do with the real economy. The EU will eventually be forced by reality to move from denial to acceptance. Meanwhile, the Global South will be fast adapting to the new paradigm: the Davos Great Reset has been shattered by the Russian Reset.

The views expressed in this article do not necessarily reflect those of The Cradle.

Renegade interviews Michael Hudson: Sanctions, the blowback

March 23, 2022

Posted with Michael Hudson’s permission

https://www.rt.com/shows/renegade-inc/552236-michael-hudson-sanctions-ukraine/

Ross [00:00:29] Welcome to Renegade Inc. Whatever the outcome in Ukraine, one thing is for sure the economic reverberations will be felt by everyone for years to come as the world divides between the West and a rapidly reshaping Eurasia.

Ross [00:00:49] Michael Hudson, always a pleasure to have you on the programme, welcome to Renegade Inc.

Michael Hudson [00:00:53] Thank you for inviting me.

Ross [00:00:55] Michael, sanctions, sanctions, sanctions is all we hear now. We’re sanctioning people. The West sanction people back to the Stone Age. What are the unintended consequences of sanctions?

Michael Hudson [00:01:05] Well, one is to serve very much like a protective tariff on the sanctioned country. For instance, when America made sanctions on European trade with Russia, Lithuania dutifully stopped exporting cheese to Russia. Well, the result is that Russia set up its own cheese’s sector, and now it’s self-sufficient in cheese. If you sanction a country, you force it to become more self-reliant and across the board, from agriculture to dairy products to technology, Russia is forced to become more self-reliant and at the same time to depend much more on trade with China for the things that it is still not self-reliant in. So America is bringing about exactly the opposite of what it intended. It’s hopeless to somehow isolate Russia and then be able to go after China without Russia. And instead, what it’s doing is integrating the Eurasian core, Russia and China, exactly the policy that Henry Kissinger warned against going all the way back to Mackinder a century ago that said, Eurasia is the world island, Russia and China could be the whole world centre. That’s what the fight is all about. Well, American sanctions are driving Russia and China together, and America has gone to China and said, Please don’t support Russia. It most recently, on Monday, March 14, Jake Sullivan came out and told China, we will sanction countries that break our sanctions against Russia. And basically, China said, fine. You know, we’ll just break off all the trade between East and West now and the East, Eurasia is pretty much self-sufficient. The West is not self-sufficient since it began to industrialise, and it’s heavily dependent on Russia for not only oil and gas, but palladium and many raw materials. So the sanctions are ending up driving a wedge between the European countries.

Ross [00:03:31] Don’t people who apply these sanctions think this through? Are they so short-sighted they don’t understand that these sanctions are going to build further capacity within Russia, push Russia further towards China, make that economic alliance concrete and, ultimately, you’re not going to be able to keep the lights on in in Europe? All the while underestimating the fact that from a food security point of view – take the U.K., for instance, a net importer of food – not appreciating the fact that, for instance, Russia/Ukraine, they create twenty five percent, a quarter, of all wheat annually. The estimation this year is one hundred and two million tonnes Russia and Ukraine, wheat. Don’t people realise that there’s going to be a massive knock on effect?

Michael Hudson [00:04:23] Yes, they do realise it. Yes, they’ve thought it all through. I worked with these people for more than 50 years.

Ross [00:04:31] Who are these people?

Michael Hudson [00:04:32] The neocons, basically, the people who are in charge of U.S. foreign policy? Victoria Nuland and her husband, Robert Kagan, the people that President Biden has appointed all around him, from Blinken to Sullivan and right down the line. They are basically urging people around the New American Century. They’re the people who said America can run the whole world and create its own reality. And yes, they know that this is going to cause enormous problems for Germany. They know that not only will it block the energy that Germany and Italy and other countries in Europe need through their oil and gas, but also it’ll block the use of gas for fertiliser, upping their fertiliser production and decreasing their food production. They look at this and they say, How can America gain from all of this? There’s always a way of gaining what something looks to be bad. Well, one way they’ll gain is oil prices are going way up. And that benefits the United States whose foreign policy is based very largely on oil and gas. The oil industry controls most of the world’s oil trade, and that explains a lot of the US diplomacy. This is a fight to lock the world energy trade into control by U.S. companies, excluding not only Iran and Venezuela, but also excluding Russia.

Ross [00:06:16] So as Europe pushes towards more and more green and renewable energy and this for the Americans they must think it’s a dreadful scenario insofar as they can’t sell the oil as Europe becomes or wants to become more self-sufficient. So ultimately, and Britain net zero, whatever that means. But but going down the renewables path, going down the solar path takes America’s dependency or dependency on America out the game, doesn’t it?

Michael Hudson [00:06:49] This is exactly the point that the European public has not realised. While most of the European public wants to prevent global warming and prevent carbon into the atmosphere, U.S. foreign policy is based on increasing, and even accelerating, global warming, accelerating carbon emissions because that’s the oil trade. Suppose that Europe got its way. Suppose if the Greens got what they wanted and Germany and Europe were completely dependent on solar energy panels, on wind energy and to some extent, on nuclear power, perhaps? Well, if they were completely self-sufficient in energy without oil or gas or coal, America would lose the primary lever. It has over the ability to turn off the power and electricity and oil of any country that didn’t follow U.S. diplomatic direction.

Ross [00:07:48] So when we take your analysis here and we think about how the sanctions are going to build capacity, push Russia and China together, when we start to look at sort of piggy in the middle, if you like the EU, when we’re thinking about America, the EU has had a sort of abusive relationship with the Americans for quite some time now, hasn’t it?

Michael Hudson [00:08:06] Well, that’s that’s true in the sense that EU foreign policy has basically been turned over to NATO. So instead of European voters and politicians making their policy, they’ve relinquished European foreign policy to NATO, which is really an arm of the US military. So yes, Europe has had a decent relationship with the United States diplomatically by saying yes, yes, please or yes, thank you by not being independent. Of course, if it were independent, the relationship would not be so friendly and decent.

Ross [00:08:46] So for countries that are net importers of food, need to keep the lights on, need heating and need cheap oil. How does this pan out? What does it look like for the UK? What does it look like for the EU?

Michael Hudson [00:08:59] Well, Vice President, Kamala Harris the other day said to Americans, Yes, life is going to be much more expensive. Our oil prices are going up and squeezing families. But think of the poor Ukrainian babies that we’re saving. So take it on the chin for the Ukrainian babies. So basically the United States is presenting horror stories of the Ukraine and saying, if you don’t willingly suffer now by isolating Russia, then Russia is going to roll over you with tanks just like it rolled over Central Europe after World War Two. I mean, it’s waving the flag of Russian aggression, as if Russia or any country in today’s world has an army that’s able to invade any other industrial nation. All military can do today of any country is bomb and kill other populations and industrial centres. No nation is able to occupy or rollover any industrial country. And the United States keeps trying to promote this mythology that we’re still in the world of 1945. And that world ended really with the Vietnam War when the military draft ended. And no country is able to have a military draft to raise the army with necessary to fight to invade. Russia can’t do it any more than Europe or the United States could do it. So all the United States can do is wave warnings about how awful Russia is and somehow convince Europe to follow the US position. But most of all, it doesn’t really have to. Europe doesn’t really have a voice, and this is what the complaint by Putin and Foreign Secretary Lavrov have been saying. They say that Europe is just following the United States and it doesn’t matter what the European people want or what European politicians want. The United States is so deeply in control that they really don’t have much of a choice.

Ross [00:11:15] When does the consumer start to feel this? When does the European or British consumer start to feel the pinch when these sanctions are enacted? And what does that look like?

Michael Hudson [00:11:25] Well, it depends on how fast the sanctions work. The United States said Well, in another year and a half, we’ll be able to provide Europe with liquefied natural gas. Well, the problem is, first of all, they’re not the ports to handle the liquefied natural gas to go into Europe. Secondly, there are not enough ships and tankers to carry all of this gas to Europe. So unless there are very warm winters, Europe is not going to have a very easy time for the next few years. And that’s only for oil and gas. It’s dependent on raw materials that Russia produces. For instance, palladium is necessary for catalytic converters. Titanium is necessary to make the screws that are especially used on aeroplanes that are strong enough not to buckle and break when winds go up and down and when they’re full. Russia even produces the neon and the crypton that are necessary for making some kind of electronic uses and also for many components that go into computers and information technology. There’s a whole range of exports that Europe is highly dependent on, and the United States has provided Putin with a whole list of these exports, saying, Well, OK, we’re going to fight against Europe buying your oil and gas but you can certainly sell us your heavy oil that we need since we’re not buying it from Venezuela. We certainly need the following list of critical materials that we need, like helium and crypton. These are our pressure points. Please don’t press on them. Well, you can imagine what Putin and his advisers are saying. Thank you for giving us this list of the pressure points that you’re exempting from the trade sanctions. I think if you really want a break in the unilateral, unipolar world, I think we should break now and see whether you really want to get along without trading.

Ross [00:13:51] Michael Hudson, welcome back, second half, Renegade Inc. Wonderful to have you. In that first half we followed the money, if you like. We talked about sanctions and the unintended consequences. I just want to pull back a little further if we can and just talk about the sort of tectonic shifts that are going on in the world. I spoke to somebody from Russia recently and what he said was very straightforward. He said, now what we have to do is begin to learn to live without the West. Do you think that that sentiment is proliferating across Russia now? Is that the mindset?

Michael Hudson [00:14:22] Well, if you read President Putin’s speeches, that’s exactly what’s happening. And Secretary Lavrov has voiced exactly the same feeling. There’s almost a disgust with the West and a feeling from Putin, Lavrov and the other Russian spokesmen, how could we everhave hoped to have an integration with Europe after 1991? Europe really was not on our side at all, and we didn’t realise that Europe is really part of the U.S. diplomatic sphere. It’s like all of Europe is now backing the attack on Russia. The best to do is reorient our economy towards China, Asia and Eurasia and become our own self-sufficient, independent centre

Ross [00:15:15] De-dollarisation and the amassing of plenty of gold by both the Russians and the Chinese. Just talk us through that.

Michael Hudson [00:15:21] Well, Ross, you asked in the first half of this interview how has American sanctions worked against it? I should have mentioned what you just mentioned, the dollar. The United States just grabbed all of Russia’s foreign exchange reserves, just as England a few months ago grabbed all of Venezuela’s gold that was held in the Bank of England when Venezuela tried to spend this gold on buying medical supplies to cope with the COVID virus. So basically, the United States have said, if any foreign country holds its reserves in the United States or accounts in U.S. banks. If a country in the global south tries to pay its foreign debt by holding its reserves in US banks in order to be the paying agent on the interest on its foreign debt. And if that foreign country does something we don’t like, like trade with Russia or permit more labour unionisation or try to become independent in food, we’re just going to do what we did to Venezuela, what we did to Iran when we grabbed its foreign exchange reserves or what we did to Russia. And that means that other countries all of a sudden see what they thought was their flight to security, what they thought was their most secure savings, their holdings in U.S. banks, US treasury bill, all of a sudden, is holding them hostage and is a high risk. Even the Financial Times of London has been writing about this, saying, how can the United States that was getting a free ride off the dollar standard for the last 50 years, ever since 1971, when foreign countries held dollars instead of gold and basically holding dollars means you buy U.S. Treasury bonds to finance the US budget deficit and the balance of payments deficit. How can the United States kill the goose that’s giving it the free ride? Well, the answer is that other countries can only move into gold and there’s an alternative to the dollar because that’s something that all the countries of the world have agreed upon is an asset, not a liability. If you hold any foreign currency, that currency is a liability of a foreign country, and if you hold gold, it’s a pure asset. There’s no country that can cancel it, the Americans can’t cancel Russia’s gold supply that’s held in Russia, although it can grab Russian gold supply if it were to hold it in the New York Federal Reserve Bank or the Bank of England. So other countries are not only moving to gold, Germany is bringing its gold back from New York, the Federal Reserve, in aeroplanes back to Germany, so it’ll have its own gold just in case German politicians would do something the United States didn’t like and the United States would simply grab Germany’s gold. The United States sanctions, and it’s especially it’s grabbing on foreign reserve, has started a war that is dividing the world between the West and Eurasia.

Ross [00:18:40] A technical part to all of this because let’s face it, it is an information war and it’s also an economic war. Is it the FIRE sector that you point out – the financial, insurance and real estate sector. Is it that they want to continue the exorbitant privilege of credit creation, because ultimately, if you think about gold, there’s no counterparty risk. Gold is gold and it has been for millennia. Far from being a barbarous relic, by the way now, people are starting to realise the intrinsic value, especially as crypto falls apart. Can you just talk a little bit about this, the FIRE sector wanting the exorbitant privilege of creating credit?

Michael Hudson [00:19:19] This is really what the new world division and global fracture is all about. You’re right, Ross. If you look at after World War One, the American fight against Soviet communism, was basically a fight of industrial capitalism against the threat of socialism. But after 1991, and especially in the last two decades, America deindustrialised. So the fight is not by industrial capitalism against countries pushing their labour up. It’s a fight of neoliberalism against industrial capitalism or socialism abroad. It’s against industrial capitalism evolving into socialism. It’s a belief that, well, now that America’s be industrialised, how is it going to control the world economy? Well, it’ll control it through a financial means by being the creditor and foreign countries debt payments to America will enable it to make its military payments abroad and finance its trade deficit. But also, America’s purchase of key natural resources will give it natural resources when its purchase of takeover of real estate is going to essentially make the United States the landlord class and monopoly class, that mediaeval Europe had to hold the rest of the population in serfdom. That basically is the American strategy of neoliberalism fighting against countries that reject privatisation and financialization of their economy, and specifically financialization under the control of U.S. banks, U.S. private capital and allied satellite banks and capital from England or France or Germany. This is exactly the fight. Will banking and finance control the world economy or will other countries try to build up their own economies through labour and tangible capital formation?

Ross [00:21:27] Where do you stand on that? And I’m only asking you to predict the future, Michael. How do you think this plays out? Because the way you’ve depicted it is the rent seekers, the neoliberal rent seekers on one hand, and there are value creators on the other. And by the way, those two things don’t sit very well together, as we know. How does that play out?

Michael Hudson [00:21:51] Even though the United States is the largest debtor economy in the world, it’s a creditor vis-a-vis the global south and other countries and it uses its creditor position to take over their natural resources, real estate, oil and gas, mineral rights and public utilities and natural monopolies and that are being privatised in government infrastructure. It’s becoming basically the landlord monopoly class of the entire world. That’s the U.S. strategy, and that’s the key to why the world is fracturing globally. And in the past, the global south countries were unable to fight against this tendency in the 70s and 80s with the Vendome conference on. But now that China and Russia threatened to be a self-sufficient core in Eurasia, this is the great threat to the American dream of becoming a landlord and financier of the world.

Ross [00:22:50] How do you think this pans out?

Michael Hudson [00:22:52] Well, the question is whether the United States is if we can control the world, who wants to live in a world like that, let’s blow it up. The question is whether the United States will actually go to war. The only lever that it has left is to drop bombs and to destroy and make the world look like Ukraine. So from the U.S. point of view, Europe’s future and Eurasia’s future is the Ukraine. Look at what we will do to you if you don’t follow our policy. America has just moved al Qaeda very heavily in the Ukraine to sort of repeat in Ukraine and Europe what it was doing in Syria and Libya. And the United States says this is what we can do. What are you going to do about it? Do you really want to fight. But the rest of the world, certainly China and Russia says, Well, we’re ready to fight. So there is no telling what you. And it comes down to personalities. Putin has said, well, do we really want to live in a world without Russia? If the United States is to attack us, we might as well end the world. The United States says, Do we really want to live in a world that we can’t control? If we’re not completely in control, we feel very insecure and we’re going to blow up the world. So you have this countervailing position in a world where all the arms control has been dismantled by the United States in the last few years. The United States has withdrawn from all of the agreements that Russia and China have tried to promote. And Europe is standing by and apparently is willing to be the sacrificial lamb in all of this as Ukraine is being the sacrificial lamb. So the United States and Russia say, let’s fight to the last European. And Russia initially didn’t want that because it was hoping that Europe and Russia would have a mutual gain in trade and investment relationships. But now it doesn’t feel that way. And there may be a proxy war between the United States over the European economy, not necessarily bombing Europe, but trade sanctions, energy sanctions, the kind of disruption that Europe is going to be seeing in the next year is if it loses Russian oil and gas and minerals and also, I think Chinese exports.

Ross [00:25:25] Is there a moment where cooler heads prevail and suddenly the West and other places realise that they’re dependent from a food security point of view, from an energy security point of view that we are dependent? And is there a moment at that point that you can thaw a frozen conflict by saying, actually, if we both meet, we just take a step toward each other, actually, we can do something in a collaborative way? Now I get what you’ve said throughout the rest of the programme, and I give this a percentage possibility of about three percent, but isn’t there a strategy to say, actually, we’ve had all the grandstanding, we’ve had all the brinksmanship, we should now sit around the table and try and work something out?

Michael Hudson [00:26:03] I don’t see any cooler heads in the United States. The surprising thing is that here it’s the right wing channel, the Republican Fox Channel, is the only channel that’s taking the anti-war stand and is saying we shouldn’t be at war in Ukraine. It’s the only channel that’s talking about here is how Russia sees the world. Do we really want to take a one sided perspective or do we want to see the actual dynamics at work? So it was the Republicans and the right wing that is now primarily against the NATO war in the Ukraine. The left wing seems to be all for it, but the left wing of the Democratic Party is in office and I don’t see any cooler heads in the Democratic Party at all. And I’ve known many of these people for many decades, and they are willing to go to war for a death. There are still back in the world of World War Two when the fight was against the Nazis and anti-Semitism. They’re still living in a kind of mythology world, not in the real world. And the thought that the world can come to an end either doesn’t have a reality to them or as Herman Cain said, Well, somebody is going to survive.

Ross [00:27:29] Michael Hudson always a pleasure, a great insight. And, you know, it’s just refreshing to hear. Thank you very much for your time.

Michael Hudson [00:27:38] Well, thank you very much for having me, Ross.

Is Qatar the means for a US comeback in Eurasia?

Energy-rich Qatar’s designation as a major non-NATO ally may upset the Persian Gulf balance, but could be a means for the US to counter a Sino-Russian lockhold on Eurasia.

March 21 2022

Washington’s sudden upgrade of Qatar to a Major Non-NATO Ally is not only about gas, but a means to get a foothold back in Eurasia.Photo Credit: The Cradle

By Agha Hussain

The US’ designation of Qatar as a Major Non-NATO Ally (MNNA) carries more geopolitical significance than is immediately evident. It in fact can be viewed as one of Washington’s first steps toward a new strategy for a US riposte against Russia and China at key theaters in Eurasian great-power competition.

On 31 January, US President Joe Biden hosted the Qatari Emir Sheikh Tamim bin Hammad Al-Thani in Washington and declared Qatar an MNNA. Also discussed was gas-rich Qatar’s potential role in alleviating Europe’s reliance on Russian gas for its energy supply – a key leverage point for Moscow to dissuade European NATO members from confronting it over Ukraine.

It should be noted, however, that Qatar itself has cast doubt over any speculation that it could unilaterally replace the continent’s gas needs in case of a shortage.

Indeed, there is no western military response to current Russian operations in Ukraine. Whether US or European Union (EU), the western strategic calculus does not deem Kiev important enough to rescue from Russia.

Nonetheless, Ukraine is still crucial for the US as a means to help counter Russian influence in vast, resource-rich Eurasia. Namely, through connecting China to Europe via the multimodal Kazakhstan-Azerbaijan (via the Caspian Sea)-Georgia-Ukraine (via the Black Sea) route and thus helping China reduce reliance on its currently most-used land route to Europe, i.e. via Russia and Belarus, a close Russian ally.

Photo Credit: The Cradle

This strategy would give the US a rare opportunity to leverage China’s global economic expansion through its Belt and Road Initiative (BRI), which it usually tries to counter with limited success, to reduce Russia’s geo-economic depth in Eurasia.

However, the aforementioned Trans-Caspian International Transport Route (TITR) is more time-consuming, costly, and closer to conflict areas than Russia-Belarus. And Moscow and Tehran have all but blocked the Caspian Sea as a transit route for pipelines. Moreover, to justify the investment needed to improve Ukraine’s transit capacity and to ensure that traders even use the TITR, the EU needs to sanction Moscow and render the Russia-Belarus route untenable.

Thus, the EU hypothetically replacing Russia with Qatar as its gas supplier, and subsequently becoming more willing to confront Moscow, unlocks a major roadmap for the US to counter Russia.

In this scenario, the EU could enhance and leverage China’s own interest in tilting to the TITR from Russia. According to a 2016 study in the European Council of Foreign Affairs, Ukraine’s harmonization with EU trade standards boosted China’s interest in increasing its Ukrainian food imports, which necessitated enhancing Ukraine’s transport infrastructure since these imports cannot travel to China via the Belarus-Russia route due to Moscow’s sanctions on Kyiv. Indeed, China signed agreements with Ukraine last year to develop the latter’s transport infrastructure.

Afghanistan

The freezing of Afghan central bank assets are burning US bridges with Afghanistan – where the US fought its longest war (2001-21) in its short history. However, the US’ withdrawal from Afghanistan in July 2021 provided an opportunity for Russian and Chinese influence to fill the void. Thus, as the US’ great-power rivalries with Russia and China deepen, the case for rebuilding contacts and connections in Afghanistan will strengthen in Washington.

Afghanistan is central to the US’ goal of building new international transport routes for the Central Asian Republics (CARs) that do not transit through Russia, whose territory and infrastructure the CARs disproportionately rely on. This is an official US objective, as represented by the C5+1 platform and Washington’s official ‘Strategy for Central Asia 2019-25’.  Afghanistan is the transit state for this strategy, to connect the CARs to its own neighbor Pakistan and Pakistani Arabian Sea ports for access to global shipment.

For a proper ‘return’ to Afghanistan as a Eurasia-focused great-power, the US appears to have selected Qatar as its conduit. In this vein, Washington shifted its operational command for Afghanistan to Qatar during the withdrawal and designated Doha its official diplomatic representative in Kabul in November 2021.

Moreover, the US picked Qatar from amongst a broad mix of options for military involvement in post-withdrawal Afghanistan. Such options included negotiating with Pakistan to allow US aircraft to transit its airspace into Afghanistan for combat purposes and even Moscow’s offer, made during the withdrawal, for the US to use Russian bases in Central Asia for intel gathering flights over Afghanistan.

Qatar stood out as the best choice from the US’ great-power perspective. Pakistan’s close regional rapport with China and emphasis on cooperation, made it unlikely to facilitate an inroad for the US. Furthermore, Qatar’s retention of its own diplomatic channels to Afghanistan makes it yet more suitable to the US’ great-power sensitivities.

Qatar hosted US-Taliban peace talks since 2013, years before platforms such as the Moscow-led ‘Extended Troika’ or Beijing’s ‘Quadrilateral Coordination Group’ (QCG) were launched. Doha was not party to either platform, or of other multilateral dialogues on Afghanistan.

Hence, the US can integrate Qatar into its bigger-picture for Afghanistan without making the Gulf state feel as if it is sacrificing its positive bilateral relations with Afghanistan’s other external stakeholders.

Aside from Ukraine and Afghanistan, Washington has another potential front against its Eurasian rivals: Qatar’s home turf in the Persian Gulf region, where common ground exists between Doha’s own ambitions and the US’ containment efforts aimed at China in particular.

The Persian Gulf and China

China and the Gulf Cooperation Council (GCC) states are especially important trading partners to each other given the unmatched size of the former’s market for the latters’ energy exports. Beijing also invests heavily in the GCC to turn it into a commercial and logistics hub for the (BRI), the single most consequential driver of Eurasian geoeconomics.

The US views China’s expanding role in the Gulf – whether in the BRI, tech investment or security realms – as a challenge to its own decades-old status as the GCC states’ main security guarantor. How the Sino-GCC embrace pans out is therefore of special interest to Washington.

As noted by Jonathan Fulton, a specialist on Sino-GCC relations, the extent of GCC participation in the BRI is dependent on each Gulf state’s own development plans with BRI. Saudi Arabia and the UAE lead the way in this respect, hosting the bulk of China’s BRI supply chain in the region in the form of industrial parks and ports heavily invested in by Beijing.

In contrast, Chinese-Qatari relations lack this connectivity dimension and are more restricted to just trade.

“In general, Qatar and China maintain a very warm relationship,” noted Gulf affairs analysts Giorgio Cafiero and Anastasia Chisholm in August last year. “The Sino-Qatari partnership is mainly energy-oriented. Beyond the cooperation in the liquefied natural gas (LNG) sector, however, there is much less to Doha’s relationship with Beijing compared to Saudi Arabia or the UAE’s relations with China.”

China has also signed ‘Comprehensive Strategic Partnerships’ with the Saudis and Emiratis in contrast to the lower-level ‘Strategic Partnership’ with Qatar.

Since Chinese investments in Qatar do not springboard the BRI the way those in Saudi Arabia and the UAE do, it makes sense for the US to boost Qatar as a hedge against complete Chinese monopoly over the Gulf’s integration with Eurasia via BRI.

The end of the three-and-a-half year, Saudi-led blockade against Qatar has not necessarily led to a halt in Doha’s rivalry with Abu Dhabi and Riyadh. Rather it has grown more central to its foreign policy as it reclaims its place in the GCC without letting its guard down. This is a reality of Gulf affairs that will likely accompany the GCC’s closer integration with the BRI.

Qatar can offset its GCC rivals’ gains from the BRI by increasing its military engagement with the US. Both the Saudis and Emiratis still rely on the security umbrella that complying with the US’ great-power priorities brings yet have also strengthened ties with China.

This dilemma could also turn Saudi Arabia and the UAE’s increasing defence ties with both China and Russia into driving factors of a partisan pro-Qatari slant in the US’ Gulf policy. After all, Qatar has kept its own defence dealings with China and Russia minimal compared to those with the US.

The UAE recently suspended talks with the US to import the latter’s F-35 fighter jets. One of the reasons for this impasse is Emirati resentment at the US tying the deal to Abu Dhabi’s 5g contract with Chinese telecom giant Huawei, which Washington sees as means for China to compromise the Emirati-imported F35s’ technology. Meanwhile, Qatar’s own talks for the F-35s proceed with less complications and are arguably boosted by its MNNA designation.

China does not want its regional investments getting caught up in the intra-GCC competition for primacy in the Gulf, which could happen if the US greenlights the F-35s for Qatar but not for the UAE, thus setting a precedent for deeper rivalry.

After all, intra-GCC competition has increasingly exhibited zero-sum tendencies. This was seen last year when Saudi Arabia told companies doing business in the kingdom that they would lose their government contracts unless they shifted their regional headquarters to Riyadh from Dubai and then also excluded imports from Emirati economic zones from their preferential tariffs.

Such “zero-sumism” is antithetical to what China wants in the Gulf, which is the harmonization of each Gulf state’s trade and connectivity policies. Beijing needs this to synergize its various Gulf investments into serving a broader, unified global strategy as per the BRI.

Thus, the US could use its ascendant ties with Qatar to cause China a significant headache in the Gulf, especially considering how far Beijing stays from contributing to zero-sum rivalries and standoffs due to its neutrality-oriented foreign policy.

Mutual convenience

However it pans out, the emerging US-Qatari alliance in Eurasia is highly convenient to both sides.

At the very least, the US can try to leverage Qatar’s potential energy role in Europe, its diplomatic role in Afghanistan and its ambitious Gulf policies relative to growing Chinese influence there for its own geopolitical interests.

As for Qatar, the fact that these roles do not threaten its bilateral relations with either China or Russia is a major plus point. Neither of the Eurasian great-powers is zero-sum in its foreign relations outlook and is unlikely to deem Qatar’s prospective participation in the US’ Eurasia strategy a major problem.

Eurasia is once again at the forefront of geopolitics and great power rivalries. Following the US exit from Afghanistan last summer, the incumbent superpower, was perceived to be scaling back if not withdrawing from this strategically important region, however in its relationship with Qatar, the US has shown it may be down but not quite out of Eurasia.

The views expressed in this article do not necessarily reflect those of The Cradle.

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الجمعة 18 آذار 2022

 العميد د. أمين محمد حطيط _

حرصت روسيا في عمليتها العسكرية الخاصة التي أطلقتها في أوكرانيا بهدف الدفاع عن الأمن القومي الروسي وأمن الأشخاص الروس في إقليم الدونباس غربي الحدود مع أوكرانيا، على إظهار تحركها منجزاً في إطار أحكام القانون الدولي العام، حيث إنها لم تبدأ عمليتها إلا بعد أن اعترفت باستقلال الجمهوريتين المنفصلتين عن أوكرانيا ثم توقيع معاهدة تعاون ودفاع مشترك معهما ثم قيام الجمهوريتين بطلب تقديم الدعم العسكري للدفاع عنهما. ثم انها ودعماً لحقها في تنفيذ العملية أظهرت الكثير من الوثائق والحجج التي تثبت أنّ أوكرانيا كانت تعدّ لعدوان على روسيا بأسلحة تقليدية وغير تقليدية، وبالتالي فإنّ العملية برمتها يمكن تصنيفها تحت عنوان «الحرب الاستباقية»، وانها عمل من أعمال الدفاع المشروع عن النفس ضدّ خطر تخطى الاحتمال ووصل الى درجة التحقق الفعلي.

وفي هذا التحليل تقدّم روسيا عمليتها او تبرّر أعمالها العسكرية بأمرين الأول استجابة قانونية لطلب دولة حليف متعاقد منعها عسكرياً والثاني دفاع مشروع عن النفس ضدّ خطر تأكد قرب وقوعه، وبالتالي تسقط روسيا من التداول فرضية العدوان التي تتمسك بها مجموعة الغرب الأطلسي وتؤمّن لنفسها الغطاء القانوني الذي يوفره لها التفسير المتقدّم لأحكام القانون الدولي العام وبشكل أدقّ لأحكام الحقّ بالدفاع المشروع عن النفس وإغاثة الحليف المهدّد المعتدى عليه العاجز عن دفع العدوان عنه، ولا تكترث لقرار الجمعية العامة للأمم المتحدة الذي يرى غير ذلك وبأكثرية ١٤١ صوتاً، بل تقدّم تفسيراً جديداً لمدى حقّ الدفاع عن النفس تفسيراً سيكون محلّ نقاش من قبل خبراء القانون.

 واستنادا لما تقدّم خططت روسيا لعمليتها العسكرية الخاصة وحدّدت أهدافها بأنها دفاعية محضة وانها لا ترمي فيها لاحتلال او اقتطاع أرض بل ترمي الى منع أوكرانيا من تشكيل تهديد جدي مستقبلي للأمن القومي الروسي ولأمن السكان من أصل روسي في الدونباس، أمن يتحقق بشكل عملي وميداني وواقعي لا يكتفي بالمعاهدات والالتزامات القانونية بل يتخطاها الى الحالة والسلوك العملي والسبب في ذلك عائد الى انّ أوكرانيا التي كانت قد التزمت في اتفاقيتي مينسك ١ و٢ بما يؤمّن طلبات روسيا حول الأمن نكثت بالتعهّدات تلك واندفعت في تقديم نفسها مسرحاً لأميركا وللحلف الأطلسي يقيم فيها المختبرات البيولوجية ويتحضر للعبث بالأمن القومي الروسي، ورأت انّ هذه الأهداف لا تتحقق بشكل أساسي إلا بإعلان حياد أوكرانيا ونزع سلاحها وتأكيد استقلال جمهوريتي الدونباس فضلاً عن الاعتراف بنهائية عودة شبه جزيرة القرم الى الدولة الأم روسيا كما سبق وأعلن في العام ٢٠١٤.

بيد انّ اميركا التي امتهنت الاستخفاف بالقانون الدولي العام ومارست الحروب العدوانية ضدّ الشعوب بذرائع مختلفة منها بدعة حقّ التدخل الإنساني المتقدّم على السيادة الوطنية، او إنقاذ العالم من خطر سلاح الدمار الشامل إلخ… وكلها بدع وذرائع تثبت كذبها والخطأ في إطلاقها، انّ أميركا هذه أنكرت على روسيا حقها بالدفاع المشروع عن النفس واعتبرت فعلها عدواناً وأعلنت عليها الحرب الشاملة ووصل الأمر بها الى الحدّ الذي اطلق فيه الرئيس الأميركي بايدن على الرئيس الروسي بوتين صفة «مجرم حرب» وتوعّده بأنه سيدمّر الاقتصاد الروسي ويعزل روسيا عن كامل العالم.

وفي المقابل كان الردّ الروسي وعلى لسان بوتين نفسه مؤكداً الحقّ الروسي بالدفاع المشروع عن النفس ومظهراً إصراره على المضيّ في العملية العسكرية التي أطلقها حتى تحقيق أهدافها المحددة والمعلنة وموجها بشكل صريح او ضمني رسائل واضحة لكلّ معني بالأمر بانّ روسيا لن توقف عمليتها قبل تحقيق أهدافها، وانّ هذه الأهداف يمكن ان تتحقق بالتفاوض إذا استخلصت حكومة كييف العبر من مجريات العملية حتى الآن وانّ تقديم الدعم العسكري لكييف لن يمكنها من الصمود أمام الآلة العسكرية الروسية الماضية قدماً في أعمالها العسكرية حتى النهاية. وأخيراً انّ من حقّ روسيا ان تتصرف وفقاً لمصالحها الدفاعية مع مقدّمي تلك المساعدات وقوافل الإمداد التي تحملها، والمتطوّعين الذين يجندهم الغرب من المرتزقة للقتال في أوكرانيا وبالتالي بات الصراع في أوكرانيا محكوماً باستراتيجيتين:

ـ أولى روسية وتتمثل بالضغط العسكري للوصول الى التفاوض، دون التوسع باحتلال الأرض والاكتفاء بتدمير القدرات العسكرية لحكومة كييف بما يدخلها في الانهيار الميداني ويحملها على الدخول في تفاوض جدي والاستجابة لطلبات روسيا ذات الطبيعة الدفاعية عسكرياً واستراتيجياً وسياسياً، وبما يحول دون تحوّل أوكرانيا مستقبلاً الى منصة تهديد للأمن القومي الروسي.

ـ الثانية أميركية غربية أطلسية وترمي الي إطالة أمد الصراع وجرّ روسيا الى حرب استنزاف لسنوات طويلة لإنهاكها واستنزاف قدراتها وإشغالها عن علاقتها الدولية والمشاركة في حلّ الازمات والمسائل الدولية ومنعها من التكامل الاستراتيجي مع الصين وإيران في إطار المجموعة الاستراتيجية العاملة لمنع أميركا من التسيّد على العالم في ظلّ نظامي دولي أحادي القطبية.

هما استراتيجيتان إذن تحكمان المواجهة في أوكرانيا التي باتت مسرحاً لصراع دولي ينظر إليه من الوجهة الروسية بأنه صراع وجودي ترى انّ الهزيمة فيه تعني نهايتها كدولة بصيغتها القائمة، لأن الهجوم الغربي سيتمدّد ليصل الى تفكيك روسيا ذاتها وشطبها كدولة اتحادية ذات موقع متقدّم في النظام الدولي، وترى فيه أميركا جسراً تعبر عليه ليخرجها من دائرة هزائمها ويمكنها من استعادة القبض على قرار العالم ومتابعة إحكام السيطرة على أوروبا وعلى مصادر الطاقة لتتفرّغ بعد ذلك لمواجهة الصين لاحتوائها.

اما في الميدان، فإنّ روسيا تسعى الآن لممارسة الضغط العسكري بأقصى ما يمكن، مع الاستعداد لتوسيع الاشتباك إذا اقتضى الأمر وزجّ قدرات جديدة ولا تبعد من حساباتها إمكانية الاشتباك مع الناتو إذا وصلت الى وضع لا يكون فيه مفرّ من هذا الاشتباك. أما أميركا فإنها خططت في الأصل لحرب بالوكالة تستعمل فيها كلّ ما هو بمتناول يدها شاملاً الإعلام والسياسة والاقتصاد والفن والرياضة إلخ… من دون ان تقحم قواتها العسكرية أولاً ودون استبعاد اللجوء اليها عند الاضطرار، مع التركيز على مسألتين الأولى منع كييف من الاستسلام والتوجه الى مفاوضات لتوقع فيها اتفاق إذعان مع روسيا، والثاني منع التراخي الأوروبي في مواجهة روسيا مهما كانت الظروف، وهنا يُطرح السؤال عن احتمالات المستقبل وعن نهاية الحرب، حيث يمكن تصوّر حصول واحد من ثلاثة احتمالات:

الأول: تمكن روسيا من تصعيد ضغوطها العسكرية في الميدان وإطلاق مفاوضات جادة مع أوكرانيا تفضي الى التسليم بالمصالح الروسية وتحقق أهداف العملية العسكرية بشكل مؤكد، وهو احتمال لا يبدو قريباً في الظرف الراهن انما ستستمر روسيا بالسعي وفقاً له.

الثاني: خشية روسيا من الثمن الباهظ في حال الانزلاق الى حرب استنزاف وفقاً للخطة الأميركية ما يحملها على التراجع التكتي عسكرياً والتوقف عن محاصرة المدن الكبرى مع الاحتفاظ بكامل السيطرة على كامل الدونباس وفرض الحصار البحري على أوكرانيا الى ان تتهيأ فرص الاتفاق على حلّ وسط يلبّي الأهداف الروسية الأساسية.

الثالث: تغيّر في استراتيجية روسيا او الناتو ما يؤدّي الى توسيع ميدان الحرب خارج حدود أوكرانيا وسقوط فرضيتي حرب الاستنزاف والحرب البديلة او الحرب بالوكالة. وهنا سيكون العالم كلّ العالم على اعتاب مرحلة صراع عالمي غير مسبوق ولم تعرفه حتى الحربين الأولى والثانية، وان انعقاد قمة الناتو في الأسبوع المقبل وبحضور بايدن شخصياً يؤشر الى أمر لا يمكن إهمال خطورته وهو الاحتمال الذي يبقى الأبعد تحققاً الآن.

أما فرضيات الدخول في حرب استنزاف كما تشتهي اميركا، او تراجع روسيا دون تحقيق أهدافها، فإننا نرى انهما فرضيتان لا يُعتدّ بهما الآن، لأنّ في ذلك انتحاراً روسياً من المستحيل ان تقدم روسيا عليه خاصة أنها تملك من القدرات والطاقات التي تمكنها من العمل في أيّ من الخيارات الثلاثة أعلاه وكلها تحقق لها مصالحها وإنْ تفاوتت سقوفها وحجم التضحيات والأثمان فيها.

*أستاذ جامعيّ ـ باحث استراتيجيّ

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