Ironically, the war that the Donald triggered is generating the world that Trump wanted. That is to say, a politically-driven economic regime based on the hoary principles of mercantilism, protectionism and autraky.
Needless to say, free market advocates have long warned this is also a prescription for a devastating fall in capitalist prosperity and declining living standards. Now we are about to get a live fire experiment in globalized Trump-O-Nomics, delivered by Sleepy Joe and his minions!
We are referring, of course, to Washington’s bipartisan war on the dollar-based global trading and payments system, which they are pleased to call “sanctions”. What these numbskulls do not understand in the slightest is that the faux prosperity of the last three decades was the spawn of ultra-easy central bank money, which dodged the bullet of runaway goods and services inflation only due to the deflationary effect of the one-time globalization of the planet’s supply chain.
But in the annals of oil and water not mixing, to say nothing of cats and dogs, there is nothing more incompatible than a tightly integrated global economy, on the one hand, and an economic warfare based neocon imperialism, on the other. The former reflects the idea of peaceful commerce among nations; the latter the arrogance of an empire that has lost all touch with its own vital interest.
So, fine, Russia shouldn’t have invaded Ukraine. By the same token, however, who appointed Washington as Spanker-in-Chief for nations of the world who get out of line?
Yet Spanker-in-Chief is the only possible justification for Washington’s ravenous economic attack on Russia’s role in the global economy. The fact is, the United States has no strategic interest in the spat between Russia and Ukraine, and Russia is no military threat to the American homeland, or even Europe for that matter.
Needless to say, these truths run contrary to the war hysteria being peddled by all three cable TV networks and the risible claims that Putin in trying to reconstitute the old Soviet Empire. The man himself once made the opposite perfectly clear, but has been misquoted over and over with malice aforethought ever since via the trick of dropping the bolded part of his oft-quoted sentence:
Whoever does not miss the Soviet Union has no heart. Whoever wants it back has no brain.
So let us state it once again: This is strictly an intramural spat between Russians and Ukrainians that has gone on for centuries in the very territories now at war. Indeed, Russia was born in Kiev 1100 years ago, with the borders, populations and sovereignties moving around the Black Sea region like play-dough ever since.
The reason for Putin’s attack is nothing more, therefore, than the obdurate determination of post-Maidan Coup governments in Kiev to turn their country into a doormat for NATO and a potential launching pad for US/NATO missiles located cheek-by-jowl on Russia’s border and within spitting distance as missiles fly (470 miles) of Moscow.
Putin first warned against this at the Munich Security Conference in 2007; renewed the warning over and over thereafter; and, most recently, insisted upon it intently during his un-reciprocated attempts to negotiate a new security arrangement with Washington.
So, no, Putin cares about Russia’s own security. He doesn’t lust for the Baltics or Rumania, and, for crying out loud, already has all the Poland Russia ever wanted.
That’s right. The ex-generals coming on cable TV who suggest Poland is next are simply reminding us why the US has not won a single-war in their lifetimes. To wit, they are ignorant of history beyond measure.
As it happened, Stalin did want the gray area of the map from the so-called Curzon Line (blue line) eastward, which comprised the eastern provinces of the revived state of Poland created at Versailles in 1919. So he ask FDR and Churchill for their blessing at the Tehran Conference in 1943; insisted upon it at Yalta in early 1945; and obtained Churchill and Truman’s official approval at Potsdam in July 1945, where as territorial compensation, Poland got the pink areas from the defeated carcass of Nazi Germany.
Like the doings of a sausage factory, of course, the viewing of what actually happened may not be uplifting. But the fact is, at no time during the Soviet era, even at the peak of its power circa 1960, did Moscow try to add these or even more Poles to Russia proper. They ended up in the Soviet provinces of Lithuania, Belarus and Ukraine because the Slavic Russians knew better than to incorporate the Catholic Poles, and so does Putin.
Poland Was Already Annexed Long Ago
So, yes, Washington is aflame with anti-Russian blood-lust because the role of Spanker-in-Chief suits the careerist pols and apparatchiks domiciled in the beltway. But the economic wreckage of their unhinged sanctions palooza will be biblical in scope before it’s over.
That because among the many victims of the world economy dissolving into segmented money and trade blocs will be the easy central bank money that is the foundation of today’s bubble-ridden financial system. To wit, just as the spread of global supply chains to the lowest cost corners of China and the planet after 1995 created a deflationary tide, their unwinding will generate the opposite.
That is, rising costs and inefficiencies that will cause measured price indices to soar relentlessly in the months and years ahead. Central banks will therefore be hopelessly behind the curve, tightening “policy” relentlessly for years to come because the deflationary sabbatical of 1995-2019 is being supplanted by the inflationary gale which is inherent in the breakdown of the dollarized global supply chain.
Again, we offer the chart below depicting the humble case of children’s toys. During the years between 1978 and 1996, before the great China-based supply chain deflation worked up a head of steam, the CPI for toys rose by +3.03% per annum.
Yet did toys suddenly go full retard deflationary for the next 23 years owing to economic immaculate conception?
No, they did not. The migration of the toy business to the cheapest nooks and crannies of the global supply chain is what caused the CPI for toys to crash, dropping continuously by -6.0% per annum for more than two decades running. And the same is true to a less dramatic degree for manufactured goods generally.
CPI For Toys, 1978-2022
So the question recurs. Was the Donald’s four-year sojourn in the White House worth the candle, given that the resulting TDS has brought the world to the present fraught state of global madness?
The question answers itself, of course, because among other things the double digit inflationary blow-off that is already enveloping the world owing to the sanctions war is exactly where Trump-O-Nomics was always headed, anyway.
Moreover, the idea that the current sanctions madness will soon end is naive in the extreme. At length, Russia will subdue the Kiev government, and either the current clown car president or his designee will embrace a neutralist Ukraine shorn of its eastern Russian speaking territories and left with a military reduced to the status of a glorified constabulary.
Will that “settlement” cause Washington to call off the dogs of sanctions warfare?
It will not. Washington is literally intoxicated making war by US Treasury edict.
So too, the Kiev government which makes peace with its Russian neighbor will be denounced by Washington as a Quisling government, justifying an even more drastic level of anti-Russian sanctions.
So buckle-up. We are about ready to delve into a live fire experiment in global Trump-O-Nomics.