By Michael Hudson and posted by permission
The Iron Curtain of the 1940s and ‘50s was ostensibly designed to isolate Russia from Western Europe – to keep out Communist ideology and military penetration. Today’s sanctions regime is aimed inward, to prevent America’s NATO and other Western allies from opening up more trade and investment with Russia and China. The aim is not so much to isolate Russia and China as to hold these allies firmly within America’s own economic orbit. Allies are to forego the benefits of importing Russian gas and Chinese products, buying much higher-priced U.S. LNG and other exports, capped by more U.S. arms.
The sanctions that U.S. diplomats are insisting that their allies impose against trade with Russia and China are aimed ostensibly at deterring a military buildup. But such a buildup cannot really be the main Russian and Chinese concern. They have much more to gain by offering mutual economic benefits to the West. So the underlying question is whether Europe will find its advantage in replacing U.S. exports with Russian and Chinese supplies and the associated mutual economic linkages.
What worries American diplomats is that Germany, other NATO nations and countries along the Belt and Road route understand the gains that can be made by opening up peaceful trade and investment. If there is no Russian or Chinese plan to invade or bomb them, what is the need for NATO? What is the need for such heavy purchases of U.S. military hardware by America’s affluent allies? And if there is no inherently adversarial relationship, why do foreign countries need to sacrifice their own trade and financial interests by relying exclusively on U.S. exporters and investors?
These are the concerns that have prompted French Prime Minister Macron to call forth the ghost of Charles de Gaulle and urge Europe to turn away from what he calls NATO’s “brain-dead” Cold War and beak with the pro-U.S. trade arrangements that are imposing rising costs on Europe while denying it potential gains from trade with Eurasia. Even Germany is balking at demands that it freeze by this coming March by going without Russian gas.
Instead of a real military threat from Russia and China, the problem for American strategists is the absence of such a threat. All countries have come to realize that the world has reached a point at which no industrial economy has the manpower and political ability to mobilize a standing army of the size that would be needed to invade or even wage a major battle with a significant adversary. That political cost makes it uneconomic for Russia to retaliate against NATO adventurism prodding at its western border trying to incite a military response. It’s just not worth taking over Ukraine.
America’s rising pressure on its allies threatens to drive them out of the U.S. orbit. For over 75 years they had little practical alternative to U.S. hegemony. But that is now changing. America no longer has the monetary power and seemingly chronic trade and balance-of-payments surplus that enabled it to draw up the world’s trade and investment rules in 1944-45. The threat to U.S. dominance is that China, Russia and Mackinder’s Eurasian World Island heartland are offering better trade and investment opportunities than are available from the United States with its increasingly desperate demand for sacrifices from its NATO and other allies.
The most glaring example is the U.S. drive to block Germany from authorizing the Nord Stream 2 pipeline to obtain Russian gas for the coming cold weather. Angela Merkel agreed with Donald Trump to spend $1 billion building a new LNG port to become more dependent on highly priced U.S. LNG. (The plan was cancelled after the U.S. and German elections changed both leaders.) But Germany has no other way of heating many of its houses and office buildings (or supplying its fertilizer companies) than with Russian gas.
The only way left for U.S. diplomats to block European purchases is to goad Russia into a military response and then claim that avenging this response outweighs any purely national economic interest. As hawkish Under-Secretary of State for Political Affairs, Victoria Nuland, explained in a State Department press briefing on January 27: “If Russia invades Ukraine one way or another Nord Stream 2 will not move forward.” The problem is to create a suitably offensive incident and depict Russia as the aggressor.
Nuland expressed who was dictating the policies of NATO members succinctly in 2014: “Fuck the EU.” That was said as she told the U.S. ambassador to Ukraine that the State Department was backing the puppet Arseniy Yatsenyuk as Ukrainian prime minister (removed after two years in a corruption scandal), and U.S. political agencies backed the bloody Maidan massacre that ushered in what are now eight years of civil war. The result devastated Ukraine much as U.S. violence had done in Syria, Iraq and Afghanistan. This is not a policy of world peace or democracy that European voters endorse.
U.S. trade sanctions imposed on its NATO allies extend across the trade spectrum. Austerity-ridden Lithuania gave up its cheese and agricultural market in Russia, and is blocking its state-owned railroad from carrying Belarus potash to the Baltic port of Klaipeda. The port’s majority owner complained that “Lithuania will lose hundreds of millions of dollars from halting Belarus exports through Klaipeda,” and “could face legal claims of $15 billion over broken contracts.” Lithuania has even agreed to U.S. prompting to recognize Taiwan, resulting in China refusing to import German or other products that include Lithuanian-made components.
Europe is to impose sanctions at the cost of rising energy and agricultural prices by giving priority to imports from the United States and foregoing Russian, Belarusian and other linkages outside of the Dollar Area. As Sergey Lavrov put matters: “When the United States thinks that something suits its interests, it can betray those with whom it was friendly, with whom it cooperated and who catered to its positions around the world.”
America’s sanctions on its allies hurt their economies, not those of Russia and China
What seems ironic is that such sanctions against Russia and China have ended up helping rather than hurting them. But the primary aim was not to hurt nor to help the Russian and Chinese economies. After all, it is axiomatic that sanctions force the targeted countries to become more self-reliant. Deprived of Lithuanian cheese, Russian producers have produced their own, and no longer need to import it from the Baltic states. America’s underlying economic rivalry is aimed at keeping European and its allied Asian countries in its own increasingly protected economic orbit. Germany, Lithuania and other allies are told to impose sanctions directed against their own economic welfare by not trading with countries outside the U.S. dollar-area orbit.
Quite apart from the threat of actual war resulting from U.S. bellicosity, the cost to America’s allies of surrendering to U.S. trade and investment demands is becoming so high as to be politically unaffordable. For nearly a century there has been little alternative but to agree to trade and investment rules favoring the U.S. economy as the price of receiving U.S. financial and trade support and even military security. But an alternative is now threatening to emerge – one offering benefits from China’s Belt and Road initiative, and from Russia’s desire for foreign investment to help modernize its industrial organization, as seemed to be promised thirty years ago in 1991.
Ever since the closing years of World War II, U.S. diplomacy has aimed at locking Britain, France, and especially defeated Germany and Japan, into becoming U.S. economic and military dependencies. As I documented in Super Imperialism, American diplomats broke up the British Empire and absorbed its Sterling Area by the onerous terms imposed first by Lend-Lease and then the Anglo-American Loan Agreement of 1946. The latter’s terms obliged Britain to give up its Imperial Preference policy and unblock the sterling balances that India and other colonies had accumulated for their raw-materials exports during the war, thus opening the British Commonwealth to U.S. exports.
Britain committed itself not to recover its prewar markets by devaluing sterling. U.S. diplomats then created the IMF and World Bank on terms that promoted U.S. export markets and deterred competition from Britain and other former rivals. Debates in the House of Lords and the House of Commons showed that British politicians recognized that they were being consigned to a subservient economic position, but felt that they had no alternative. And once they gave up, U.S. diplomats had a free hand in confronting the rest of Europe.
Financial power has enabled America to continue dominating Western diplomacy despite being forced off gold in 1971 as a result of the balance-of-payments costs of its overseas military spending. For the past half-century, foreign countries have kept their international monetary reserves in U.S. dollars – mainly in U.S. Treasury securities, U.S. bank accounts and other financial investments in the U.S. economy. The Treasury-bill standard obliges foreign central banks to finance America’s military-based balance-of-payments deficit – and in the process, the domestic government budget deficit.
The United States does not need this recycling to create money. The government can simply print money, as MMT has demonstrated. But the United States does need this foreign central bank dollar recycling to balance its international payments and support the dollar’s exchange rate. If the dollar were to decline, foreign countries would find it much easier to pay international dollar-debts in their own currencies. U.S. import prices would rise, and it would be more costly for U.S. investors to buy foreign assets. And foreigners would lose money on U.S. stocks and bonds as denominated in their own currencies, and would drop them. Central banks in particular would take a loss on the Treasury’s dollar bonds that they hold in their monetary reserves – and would find their interest to lie in moving out of the dollar. So the U.S. balance of payments and exchange rate are both threatened by U.S. belligerency and military spending throughout the world – yet its diplomats are trying to stabilize matters by ramping up the military threat to crisis levels.
U.S. drives to keep its European and East Asian protectorates locked into its own sphere of influence is threatened by the emergence of China and Russia independently of the United States while the U.S. economy is de-industrializing as a result of its own deliberate policy choices. The industrial dynamic that made the United States so dominant from the late 19th century up to the 1970s has given way to an evangelistic neoliberal financialization. That is why U.S. diplomats need to arm-twist their allies to block their economic relations with post-Soviet Russia and socialist China, whose growth is outstripping that of the United States and whose trade arrangements offer more opportunities for mutual gain.
At issue is how long the United States can block its allies from taking advantage of China’s economic growth. Will Germany, France and other NATO countries seek prosperity for themselves instead of letting the U.S. dollar standard and trade preferences siphon off their economic surplus?
Oil diplomacy and America’s dream for post-Soviet Russia
The expectation of Gorbachev and other Russian officials in 1991 was that their economy would turn to the West for reorganization along the lines that had made the U.S., German and other economies so prosperous. The mutual expectation in Russia and Western Europe was for German, French and other investors to restructure the post-Soviet economy along more efficient lines.
That was not the U.S. plan. When Senator John McCain called Russia “a gas station with atom bombs,” that was America’s dream for what they wanted Russia to be – with Russia’s gas companies passing into control by U.S. stockholders, starting with the planned buyout of Yukos as arranged with Mikhail Khordokovsky. The last thing that U.S. strategists wanted to see was a thriving revived Russia. U.S. advisors sought to privatize Russia’s natural resources and other non-industrial assets, by turning them over to kleptocrats who could “cash out” on the value of what they had privatized only by selling to U.S. and other foreign investors for hard currency. The result was a neoliberal economic and demographic collapse throughout the post-Soviet states.
In some ways, America has been turning itself into its own version of a gas station with atom bombs (and arms exports). U.S. oil diplomacy aims to control the world’s oil trade so that its enormous profits will accrue to the major U.S. oil companies. It was to keep Iranian oil in the hands of British Petroleum that the CIA’s Kermit Roosevelt worked with British Petroleum’s Anglo-Persian Oil Company to overthrow Iran’s elected leader Mohammed Mossadegh in 1954 when he sought to nationalize the company after it refused decade after decade to perform its promised contributions to the economy. After installing the Shah whose democracy was based on a vicious police state, Iran threatened once again to act as the master of its own oil resources. So it was once again confronted with U.S.-sponsored sanctions, which remain in effect today. The aim of such sanctions is to keep the world oil trade firmly under U.S. control, because oil is energy and energy is the key to productivity and real GDP.
In cases where foreign governments such as Saudi Arabia and neighboring Arab petrostates have taken control, the export earnings of their oil are to be deposited in U.S. financial markets to support the dollar’s exchange rate and U.S. financial domination. When they quadrupled their oil prices in 1973-74 (in response to the U.S. quadrupling of its grain-export prices), the U.S. State Department laid down the law and told Saudi Arabia that it could charge as much as it wanted for its oil (thereby raising the price umbrella for U.S. oil producers), but it had to recycle its oil-export earnings to the United States in dollar-denominated securities – mainly in U.S. Treasury securities and U.S. bank accounts, along with some minority holdings of U.S. stocks and bonds (but only as passive investors, not using this financial power to control corporate policy).
The second mode of recycling oil-export earnings was to buy U.S. arms exports, with Saudi Arabia becoming one of the military-industrial complex’s largest customers. U.S. arms production actually is not primarily military in character. As the world is now seeing in the kerfuffle over Ukraine, America does not have a fighting army. What it has is what used to be called an “eating army.” U.S. arms production employs labor and produces weaponry as a kind of prestige good for governments to show off, not for actual fighting. Like most luxury goods, the markup is very high. That is the essence of high fashion and style, after all. The MIC uses its profits to subsidize U.S. civilian production in a way that does not violate the letter of international trade laws against government subsidy.
Sometimes, of course, military force is indeed used. In Iraq, first George W. Bush and then Barack Obama used the military to seize the country’ oil reserves, along with those of Syria and Libya. Control of world oil has been the buttress of America’s balance of payments. Despite the global drive to slow the planet’s warming, U.S. officials continue to view oil as the key to America’s economic supremacy. That is why the U.S. military is still refusing to obey Iraq’s orders to leave their country, keeping its troops in control of Iraqi oil, and why it agreed with the French to destroy Libya and still has troops in the oilfields of Syria. Closer to home, President Biden has approved offshore drilling and supports Canada’s expansion of its Athabasca tar sands, environmentally the dirtiest oil in the world.
Along with oil and food exports, arms exports support the Treasury-bill standard’s financing of America’s overseas military spending on its 750 bases abroad. But without a standing enemy constantly threatening at the gates, NATO’s existence falls apart. What would be the need for countries to buy submarines, aircraft carriers, airplanes, tanks, missiles and other arms?
As the United States has de-industrialized, its trade and balance-of-payments deficit is becoming more problematic. It needs arms export sales to help reduce its widening trade deficit and also to subsidize its commercial aircraft and related civilian sectors. The challenge is how to maintain its prosperity and world dominance as it de-industrializes while economic growth is surging ahead in China and now even Russia.
America has lost its industrial cost advantage by the sharp rise in its cost of living and doing business in its financialized post-industrial rentier economy. Additionally, as Seymour Melman explained in the 1970s, Pentagon capitalism is based on cost-plus contracts: The higher military hardware costs, the more profit its manufacturers receive. So U.S. arms are over-engineered – hence, the $500 toilet seats instead of a $50 model. The main attractiveness of luxury goods after all, including military hardware, is their high price.
This is the background for U.S. fury at its failure to seize Russia’s oil resources – and at seeing Russia also break free militarily to create its own arms exports, which now are typically better and much less costly than those of the U.S. Today Russia is in the position of Iran in 1954 and again in 1979. Not only do its oil sales rival those of U.S. LNG, but Russia keeps its oil-export earnings at home to finance its re-industrialization, so as to rebuild the economy that was destroyed by the U.S.-sponsored shock “therapy” of the 1990s.
The line of least resistance for U.S. strategy seeking to maintain control of the world’s oil supply while maintaining its luxury-arms export market via NATO is to Cry Wolf and insist that Russia is on the verge of invading Ukraine – as if Russia had anything to gain by quagmire warfare over Europe’s poorest and least productive economy. The winter of 2021-22 has seen a long attempt at U.S. prodding of NATO and Russia to fight – without success.
U.S. dreams of a neoliberalized China as a U.S. corporate affiliate
America has de-industrialized as a deliberate policy of slashing production costs as its manufacturing companies have sought low-wage labor abroad, most notably in China. This shift was not a rivalry with China, but was viewed as mutual gain. American banks and investors were expected to secure control and the profits of Chinese industry as it was marketized. The rivalry was between U.S. employers and U.S. labor, and the class-war weapon was offshoring and, in the process, cutting back government social spending.
Similar to the Russian pursuit of oil, arms and agricultural trade independent of U.S. control, China’s offense is keeping the profits of its industrialization at home, retaining state ownership of significant corporations and, most of all, keeping money creation and the Bank of China as a public utility to fund its own capital formation instead of letting U.S. banks and brokerage houses provide its financing and siphon off its surplus in the form of interest, dividends and management fees. The one saving grace to U.S. corporate planners has been China’s role in deterring U.S. wages from rising by providing a source of low-priced labor to enable American manufacturers to offshore and outsource their production.
The Democratic Party’s class war against unionized labor started in the Carter Administration and greatly accelerated when Bill Clinton opened the southern border with NAFTA. A string of maquiladoras were established along the border to supply low-priced handicraft labor. This became so successful a corporate profit center that Clinton pressed to admit China into the World Trade Organization in December 2001, in the closing month of his administration. The dream was for it to become a profit center for U.S. investors, producing for U.S. companies and financing its capital investment (and housing and government spending too, it was hoped) by borrowing U.S. dollars and organizing its industry in a stock market that, like that of Russia in 1994-96, would become a leading provider of finance-capital gains for U.S. and other foreign investors.
Walmart, Apple and many other U.S. companies organized production facilities in China, which necessarily involved technology transfers and creation of an efficient infrastructure for export trade. Goldman Sachs led the financial incursion, and helped China’s stock market soar. All this was what America had been urging.
Where did America’s neoliberal Cold War dream go wrong? For starters, China did not follow the World Bank’s policy of steering governments to borrow in dollars to hire U.S. engineering firms to provide export infrastructure. It industrialized in much the same way that the United States and Germany did in the late 19th century: By heavy public investment in infrastructure to provide basic needs at subsidized prices or freely, from health care and education to transportation and communications, in order to minimize the cost of living that employers and exporters had to pay. Most important, China avoided foreign debt service by creating its own money and keeping the most important production facilities in its own hands.
U.S. demands are driving its allies out of the dollar-NATO trade and monetary orbit
As in a classical Greek tragedy, U.S. foreign policy is bringing about precisely the outcome that it most fears. Overplaying their hand with their own NATO allies, U.S. diplomats are bringing about Kissinger’s nightmare scenario, driving Russia and China together. While America’s allies are told to bear the costs of U.S. sanctions, Russia and China are benefiting by being obliged to diversify and make their own economies independent of reliance on U.S. suppliers of food and other basic needs. Above all, these two countries are creating their own de-dollarized credit and bank-clearing systems, and holding their international monetary reserves in the form of gold, euros and each other’s currencies to conduct their mutual trade and investment.
This de-dollarization provides an alternative to the unipolar U.S. ability to gain free foreign credit via the U.S. Treasury-bill standard for world monetary reserves. As foreign countries and their central banks de-dollarize, what will support the dollar? Without the free line of credit provided by central banks automatically recycling America’s foreign military and other overseas spending back to the U.S. economy (with only a minimal return), how can the United States balance its international payments in the face of its de-industrialization?
The United States cannot simply reverse its de-industrialization and dependence on Chinese and other Asian labor by bringing production back home. It has built too high a rentier overhead into its economy for its labor to be able to compete internationally, given the U.S. wage-earner’s budgetary demands to pay high and rising housing and education costs, debt service and health insurance, and for privatized infrastructure services.
The only way for the United States to sustain its international financial balance is by monopoly pricing of its arms, patented pharmaceutical and information-technology exports, and by buying control of the most lucrative production and potentially rent-extracting sectors abroad – in other words, by spreading neoliberal economic policy throughout the world in a way that obliges other countries to depend on U.S. loans and investment.
That is not a way for national economies to grow. The alternative to neoliberal doctrine is China’s growth policies that follow the same basic industrial logic by which Britain, the United States, Germany and France rose to industrial power during their own industrial takeoffs with strong government support and social spending programs.
The United States has abandoned this traditional industrial policy since the 1980s. It is imposing on its own economy the neoliberal policies that de-industrialized Pinochetista Chile, Thatcherite Britain and the post-industrial former Soviet republics, the Baltics and Ukraine since 1991. Its highly polarized and debt-leveraged prosperity is based on inflating real estate and securities prices and privatizing infrastructure.
This neoliberalism has been a path to becoming a failed economy and indeed, a failed state, obliged to suffer debt deflation, rising housing prices and rents as owner-occupancy rates decline, as well as exorbitant medical and other costs resulting from privatizing what other countries provide freely or at subsidized prices as human rights – health care, education, medical insurance and pensions.
The success of China’s industrial policy with a mixed economy and state control of the monetary and credit system has led U.S. strategists to fear that Western European and Asian economies may find their advantage to lie in integrating more closely with China and Russia. The U.S. seems to have no response to such a global rapprochement with China and Russia except economic sanctions and military belligerence. That New Cold War stance is expensive, and other countries are balking at bearing the cost of a conflict that has no benefit for themselves and indeed, threatens to destabilize their own economic growth and political independence.
Without subsidy from these countries, especially as China, Russia and their neighbors de-dollarize their economies, how can the United States maintain the balance-of-payments costs of its overseas military spending? Cutting back that spending, and indeed recovering industrial self-reliance and competitive economic power, would require a transformation of American politics. Such a change seems unlikely, but without it, how long can America’s post-industrial rentier economy manage to force other countries to provide it with the economic affluence (literally a flowing-in) that it is no longer producing at home?
- https://www.state.gov/briefings/department-press-briefing-january-27-2022/. Dismissing reporters’ comments that “what the Germans have said publicly doesn’t match with what you’re saying exactly,” she explained the U.S. tactics to stall Nord Stream 2. Countering a reporter’s point that “all they have to do is turn it on,” she said: “As Senator Cruz likes to say … it is currently a hunk of metal at the bottom of the ocean. It needs to be tested. It needs to be certified. It needs to have regulatory approval.” For a recent review of the increasingly tense geopolitics at work, see John Foster, “Pipeline Politics hits Multipolar Realities: Nord Stream 2 and the Ukraine Crisis,” Counterpunch, February 3, 2022. ↑
- Andrew Higgins, “Fueling a Geopolitical Tussle in Eastern Europe: Fertilizer,” The New York Times, January 31, 2022. The owner plans to sue Lithuania’s government for hefty damages. ↑
- Russian Foreign Affairs Ministry, “Foreign Minister Sergey Lavrov’s answers to questions from Channel One’s Voskresnoye Vremya programme,” Moscow, January 30, 2022. Johnson’s Russia List, January 31, 2022, #9. ↑
“Today’s sanctions regime is aimed inward, to prevent America’s NATO and other Western allies from opening up more trade and investment with Russia and China. The aim is not so much to isolate Russia and China as to hold these allies firmly within America’s own economic orbit”.
That is half true. Sanctions which the US introduced against Russia in 2014 had the dual aim of weakening the country and preventing Western Europe from trading with Russia, so it would turn towards the US. However, the overall aim was, and still is, is to isolate and completely weaken Russia in the hope it would implode and break up, after which Western banks and corporations would move in for some plundering. Too late for that.
That very much sums up the whole show!
And exactly where my purview lay.
You forget that the implosion of Russia alone will not suffice to ensure US control over Europe, which it needs to confront China and whatever part of the world now remains under US heal.
“The result devastated Ukraine much as U.S. violence had done in Syria, Iraq and Afghanistan. This is not a policy of world peace or democracy that European voters endorse”.
The more so as Ukraine is appreciably closer to Europe than Syria, Iraq, or Afghanistan.
“America’s real adversaries are its European and other allies”
Actually, European and other so-called “allies” are the tools, the chess pieces, or lapdogs of America. They are not really the adversaries in the usual meaning of the word.
They are economic adversaries. EU market is 550 million people, well off by world standards and all interested in luxury goods, Europe clearly has the capacity to become the major trading block in between a fading America and a resurgent Russia and transcendent China and of course ‘form Vladivostok to Lisbon’ on the new silk roads. The old silk roads powered Europes ‘renaissance’ once before and can do so again but Europe must cease the moment and refuse/reject US vassalage, utterly. America must rebuild or die, trying to bully the world with scorched earth policy making is infantile and counter productive. There are too many US quislings in Europe – van der leyen, Borrell, Baerbock are bought and paid for … Europe has to fight for its future or accept 52nd state status … just look at what has happened to the British, surely no one in Europe wants to end up like that?
America’s (meaning the US) real aversary is the gangster claque of dual citizens and assorted freaks and greedy enablers who inhabit the power centers of the US. A PhD will always try to needlessly complicate matters and misses the obvious.
On the money ED, all the western leaders are puppets. Dancing to the tune of Je?!sh Power. Being a minor tribe they sure weld some power only because no one is allowed to call for what it is…
US Industry is moribund, flaccid, and sclerotic. “Extreme Measures” are required to shore up the sinking ship of state. The problem that confronts the clown car that is the US “Brain Trust” is Russia possesses impressive military and technical answers to problems that exist. Answers that the US has no solution for.
This is an excellent explainer! Thank you!
A grand tour of the trap the Hegemon constructed and within which it is caught.
The problem for the US is it has no tools, no means, no alternatives but to keep printing money, to keep selling arms and to keep control of oil as much as it can.
The plantation master is not about to free the slaves. It isn’t going to change the crop.
The US will not change because it cannot change.
The US will change when some force(s) require it, force it.
Meanwhile, it is re-industrializing from the Asia Pacific supply chain. I sense that the debt problem will be solved enough to allow the economy to continue with only a brief recession as the pain for its sins.
The elites and critical corporations got what they wanted from financialization. They own and run America. They are billionaires and their corporations are trillion dollar entities. They have crushed the middle class and control the government and the election process.
If all they have to do is force a war in Europe to keep control of half the world, then it will be war.
Concurrently, Russia cannot alter its arc. It must have security. Ukraine stands in the way to that goal.
Russia has to avoid that war. Yet, it must keep the pressure on Ukraine to crack NATO unity, to divide some EU from the US.
In three weeks, we will see what options each side takes. For now, everything to come is unknown.
“In three weeks, we will see…”
Is there particular reason why three weeks?
I’ve been seen March 15. as deadline for US/NATO to obey Russian non-ultimatum but was unable to confirm it from available documents.
“For now, everything to come is unknown.”
If nothing occurs in three weeks, that may be the end of a timeline we assume now is in play. The end of the Olympics. Kozak and the Normandy group meeting. The end of military exercises. The repositioning of naval ships in various waters.
As for some deadline, diplomacy expands as required. Everyone has stated their final answer to the Ultimatums, or non-ultimatums, or whatever is supposedly a substitute for war.
Keep an eye on the Iran JCPOA talks. Biden needs a win somewhere. He may give Iran something good enough to call a deal. He will have to free up frozen money and lift weapons restrictions. Iran already came to Russia for an alliance or for weapons. But Russia is waiting until the JCPOA is back.
All these are factors in play. And all are in and around the three weeks mark. None are triggers for either side of the Ukraine situation.
Russia lost Ukraine and it may be the US turn to loose Ukraine.
I see…many events grouping in small timeframe. Coincidence? I don’t think so.
As for Bidens “victory” I’m sure Putin will find nice pacifier for him, not to cry too loud.
…I assume you are american citizen…do you really think (p) resident this sick very demented person will come up with something with looks like winning…this turkey is done just stick fork…
In one of the recent assesments from Saker, he mentioned February 18 as when stuff would start getting active
My search did not find Saker mentioning February 18. What I did find was this comment by someone else under the recent item, “Unpacking the Russian-Chinese …” Here’s the relevant part of that comment:
“according to sources at the Russian General Staff, this will happen between February 18 and 22.
Boris Gennadevich Karpov” and a link to https://boriskarpov.tvs24.ru
The site is not exactly a treasure trove. Most of the stories are pretty general, no detail that is not on scores of similar websites. For some reason this site is in French, and the EN tab (British flag) is not working. This prediction is in what’s currently the top story, “Biden veut la guerre contre la Russie” [Biden wants war against Russia], but not a word more than was in the comment. That is, “Et selon des sources à l’Etat Major Russe, ceci arrivera entre le 18 et le 22 février.” What source within the Stavka or military headquarters ? Well, the author doesn’t say. It’s all FWIW.
This blog article by Boris Karpov (written in French) reads exactly like another article that was published previously. I want to say end of January maybe in English somewhere else. I am not able to find the original source I read it at.
There are few original sources of information, and I am very grateful for Andrei and The Saker for having access to verifiable sources. The article from the Boris Karpov site does not quote or cite any sources for the article, which feels suspicious to me because I am certain I have read the article in English. It appears the man translates article, but the not cite the original source. If you take the entire text of translated article, I am certain it will read vary familiar to most of you that have been doing this research the last month or so. I apologize if this is not the appropriate place to point this out, but I wanted to ensure people are aware of this. Thanks.
If you find it useful, here is the link to the article by Boris Karpov in English. Despite the URL saying it is the French version of the same, in fact, the page opens in English.
The Middle East will be cooked up again ! Ukraine is a frozen conflict and already on the back burner – May, June things will get critical – Turkey’s Erdogan will make his moves as he is under lots of pressure to keep his power – Israel too but to contain Iran – sadly lots of war is coming !
“Armaments, universal debt, and planned obsolescence — those are the three pillars of Western prosperity. If war, waste, and moneylenders were abolished, you’d collapse. And while you people are overconsuming the rest of the world sinks more and more deeply into chronic disaster.”
— Aldous Huxley, Island
Michael makes good points but is missing the Financial Empire, which controls the U$A and has been driving the installing of central banks and the private monetary system in countries over the last four centuries. This Empire operate through the the Five Eyes. How can the UK continue trade deficit for so many decades, now reaching $200 billion per year? Why are world nations using the Empire’s private currencies ($, £, €)?
There are good and bad apples in every community. It is the duty of us good Americans to expose the bad Americans that are harming our nation, its reputation and the world. Who are these bad Americans? Why isn’t Michael not exposing bad Americans, defining their core common characteristics, instead of letting them hide behind the American label? No generalization. Please expose the wrong doers. What % of the Biden, Trump, Obama, Bush, Clinton, Bush, Reagan,… administrations came from the CFR & Bildberg groups? 100%? These administrative lackeys & puppets are controlled by the Private Imperialist Oligarchy. They control our money creation, money supply, markets, media, mercenaries…
The Financial Empire’s gameplan calls for controlling all the fuel/energy of essential economic elements. Money is the fuel/energy for the markets. Information is the fuel/energy for the mind. Oil/Gas/minerals are fuel/energy for the companies/countries. This Empire wants to control them all for its dream of a global empire.
“Who controls the food supply CONTROLS the people; who controls the energy can control whole continents; who controls money can control the world.”
Do you approve of this MONETARY Imperialism, hegemony & dominance? How about your nation?
Are you and your nation enabling or ending the monetary imperialism?
Interesting insights into the Biden administration
See: “Giants – The Global Power Elite” by Peter Phillips. Seven Stories Press, 2018.
“Michael makes good points but is missing the Financial Empire, which controls the U$A”
He has missed nothing: the USA in the context of the article means the “U$A.”
Michael Hudson won’t go there because he supports Rockefeller’s Chicago Plan. Please read and watch his articles/videos thoroughly where he openly extends support to the Chicago plan.
When one reads Michael Hudson’s “Super Imperialism” one gets an impression that the Financial Empire started after the WWII. “In 1949 the United States held three-Quarters of the world’s gold; by 1960 it had become a debtor nation. And yet, the United States has built history’s most powerful and affluent empire.” That isn’t the case. Who has been driving the installing of the Private Monetary System in countries over the last four centuries?
Michael does a good job of sharing the mechanisms of the Dollar Kingdom. However, when it comes to the solution one must be cautious and ask for a sovereign monetary system that is transparent on the money creation, its allocation and has good built in accountability. No usage of public credit for private gains.
The Chicago plan resets the system and let the powerful continue with full reserve banking and private banks creating credit. This is how the existing system started and then slowly through fractional reserve banking (the reserve % continuously declining) the money supply moves into the exponential phase. We have been there and won’t repeat those mistakes.
The Chicago plan of the Chicago University (Rockefeller Institute). was proposed by Irving Fisher, a member of Skull & Bones society. Michael worked at Chase (Rockefeller bank) and had a frontal seat in 1970s. Michael in his work doesn’t cover the key elements such as power players, POWER, central bank history, key global drivers, the control system, its structure…
No Max. He calls the Chicago School Junk Economics.
Michael doesn’t support the Austrian school but the MMT theory. The Rulers own the coin and thereby own both the sides.
“Hudson: Yes, of course! That’s why I supported the Chicago Plan, among other things, in the United States for many years.”
I just hope people read the full quoted article with attention. Because I am really not willing to shoot it out quote by quote from someone who does not understand the difference on a system that could have worked, and one that does not exist today. Even with Prof Hudson teaching the Chinese what should have been and what they never should allow. The difference between a Classical Economist and someone today from any Chicago school. We are also talking here about a plan the Prof Hudson was a part of developing. You can read all about it.
That’s because sometimes you need to play the politics and be indirect and polite so as to be able to say what you want and not end up hit and run over by a truck.
I think one can compare the relationship between the United States and China to the ‘friction’ generated by the industrial rise of Germany in relation to the British Empire at the start of the 20th, which led to two terrible wars designed to ‘keep Germany in its place.’ That war policy didn’t work. But it did bankrupt Britain and finally led to the breakup of the Empire. Britain virtually destroyed itself attempting to stop the rise of Germany. Today Germany is, compared to the UK, an economic giant and the industrial powerhouse of Europe.
What Washington is trying to do is create a massive ‘wall’ to separate Germany from Russia and China. The Baltic states, Poland and Ukraine are that ‘wall.’ Loyal vassal states ready to serve Washington, seemingly at any cost, mostly to themselves. It’s both bizarre and grotesque.
That Wall has many elements in addition to states, control of its corporations, media, money… (Finance). The president of the ECB is a lawyer, not an economist. Who are her masters?
“German stock corporations are firmly in the hands of the financial groups. Nobody owns more shares in German companies than BlackRock. It looks the same in France, Italy and the UK. In the US, however, BlackRock is “only” the number two behind Vanguard… BlackRock currently manages $ 6.85 trillion, Vanguard $ 5.6 trillion and State Street $ 2.51 trillion.”
Who controls BlackRock, Blackstone, Black Cube…? Interesting names…
Another good economist, like Michael Hudson, to follow is Norbert Haering. He provides good insights about Germany, the Private Monetary system, crony capitalism, financial control elements,… He openly challenges the Money Power!
I have to call the whole Blackrock, Vanguard thing out as a Canard. They are not money managers in the conventional sense, rather they are custodians of giant tracking ETFs. Sure Larry Fink has an ego regularly massaged by the ESG industry who are exploiting this state of affairs, but in that sense they are no different to government agencies being manipulated by others. They are puppets, not puppeteers.
I’ve always believed that your interpretation is correct.
Vanguard et al. are analagous to large vault companies – they may hold billions in assets, but those assets are under the control of their owners, not at all belonging the vault companies.
Doctor Hudson wrote, “The United States cannot simply reverse its de-industrialization and dependence on Chinese and other Asian labor by bringing production back home. It has built too high a rentier overhead into its economy for its labor to be able to compete internationally, given the U.S. wage-earner’s budgetary demands to pay high and rising housing and education costs, debt service and health insurance, and for privatized infrastructure services.”
This paragraph is a keystone the average American must understand in order to turn their economic ship around from running aground on the rocks of personal debt insolvency. Long-term investment in industrial capitalism has given way to the “addictive fix” of short-term financial, capitalistic schemes. Such greed benefits (1) Wall-Street banks (2) hedge funds (3) corporate equity and debt managers (4) career politicians in high-office who take bribes (i.e., “campaign contributions”), to enact law and regulation that favors their wealthy overseers.
We have to start with a self-awareness of the basic materials required to survive. People need access to quality and affordable (1) food (2) clothing (3) housing (4) transportation (5) healthcare (6) education. A sufficient source of earned or unearned income is of course critical to pay for the costs incurred for items 1 – 6 and a modern communication platform to facilitate the quick dispersal of knowledge and share ideas across the spectrum of human thought.
Capitalism thrives when businesses that produce goods fairly compete amongst each other for customers who can afford to purchase them without government intervention due to partisan politics. Government’s role is not to pick favorites but to provide a sensible monetary and fiscal policy in order to provide capital to fund a vibrant, domestic economy. It must also expend public money for transportation and communication infrastructure (e.g., roads, bridges, railways, telephony, internet services), for which citizens and business enterprises all need to function in a modern society.
The American youth are not taught in primary schools about what is money and how it comes into existence. The concept of managing personal debt and interest paid to a lender is hidden from them too. By the time they are adults their brains have been wired to indirectly serve the rich through participation in the system they created to prosper their own personal fortunes.
I charge this is a fault of higher education for not pushing this down to the early learning of children so when they are ready for college or university academics they will have a foundational and fundamental comprehension of economic concepts (e.g., econ 101). They will need this broad knowledge no matter what is their course of study: STEM, healthcare, arts, trade schools, public service, etc.
So what can be done to shift the balance back towards the inalienable right of the people to pursue their own share of the “American dream”?
The answer is: nothing, not a damn thing!
Unless you are a Canadian trucker (who are heroes in my book), the American people will sit on their hands and act like bubblehead dolls until the “benevolent government official” decides you have no constitutional or civil rights because well, they can and you will like it. If you don’t bend to their rule you will be financially impoverished, ostracized from your family, friends and neighbors and hated by your tenured college professors.
Oh and you senior citizens (that would be me), your social security will be cut off too because the definition of domestic terrorist will include, “Those who shall not be named.” So there you have it.
I’m done for today (at least for this article).
P.S. Thank you Doctor Hudson for another astute analysis.
“Unless you are a Canadian trucker (who are heroes in my book)” – not my heroes. The ‘movement’ was initially founded by far right pundits/politicians of US Trumpian/Rogan/Hannity persuasion, none of whom are truckers. If they had stuck with their initial design of a three day protest, well and good, but they are now into their tenth day and aggravating the people of Ottawa who are now reacting with civic means (parking tickets, noise bylaws, movement restrictions) and probably soon more police actions.
If this had been an indigenous protest, the RCMP would have moved in well before now. The truckers have well overstayed their welcome and need to take their US designed “rugged individualism” and “freedom” and go home and earn some money. Are there consequences? For sure, but they are free to choose them. With true freedom comes even greater responsibility.
Hey, Jim, you life depends on truckers. And Freedom has to be fought for in longer than 3-day “wars”.
The greatest responsibility of Free Men is to be unshackled from fascistic government tyranny and weak-spined government sympathizers.
Free Men (truckers) owe nothing to you. You choose government and call it responsibility. It’s enslavement.
And Trump and Rogan are not in the same camp. Your belief the truckers are MAGA is laughable.
I have not read of any connection between the Canadian truckers linked to a political agenda. The truckers are a grassroots campaign that object to the forced vaccination policy mandated by Canadian Prime Minister, Justin Trudeau on cross-border transport drivers that deliver goods between the United States and Canada. They simply ask the government to repeal the mandate so that international commerce can return to normal.
Millions of Canadians support their peaceful protest and have raised a great deal of money to help them continue the awareness of government overreach on the freedom of people. This event has spread to other countries including the U.S., Australia and other nations across Europe.
We are witness to democracy in action where the politicos will have to submit to the will of the electorate and stop enacting diktats that have been medically and scientifically proven to be of little benefit to the health of people.
90% of truck drivers who cross the Canada/US border are vaccinated. Yes, Canada has a vaccination mandate for cross border truckers, but so does the US. These people are a small fringe group who think that they can force the federal government to cave into their demands…and even if they did, they still would not be allowed to cross into the US. So what is there agenda? I watched them protest in Victoria, BC this past Saturday and basically the organizers entire platform is to complain about Trudeau (as if any other leader would embrace their demands), talk about the impending Great Reset, promote Bitcoin, keep yelling “Freedom!” and honk their horns. If this is “democracy in action” then so were the protests in Hong Kong and Minsk. At least there hasn’t been any real violence so far.
You wrote, “These people are a small fringe group who think that they can force the federal government to cave into their demands…and even if they did, they still would not be allowed to cross into the US. So what is there agenda?”
There are 60,000 professional truck drivers from Western Canada and 12,000 from the east are participating in this peaceful demonstration at the capital to demand the repeal of the mandate that forces citizens to receive the inoculation Thousands of U.S. drivers are also going to form up here in the U.S. as well. I hardly call that a “small fringe group.”
See: https://www.conservativewoman.co.uk/canadian-truckers-are-driving-freedom-home/ .
Millions of people support their efforts with money to keep their voices heard even though the liberal Canadian propaganda press machine and the U.S. corporate media conglomerates try to downplay their courage and tenacity against government abuse of power.
You asked what is their agenda. The answer is not complicated; how far will people allow government to control their personal life, wealth and future prosperity that is not beneficial for them but instead, tyrannical. That’s what those drivers are protesting and I wholeheartedly support them.
Spot on & well said -summed it up very well.
“These people are a small fringe group who think that they can force the federal government to cave into their demands…”
Another traitor agreeing that the Govt is not doing anything evil – – you must close your eyes & ears & even your brain to not realise that 5 eyes especially are working to a pre-planned agenda. It’s so bleeding obvious. I have no time for your ignorant comments.
When the left-wing gives up on the working class they tend to travel toward the Populist right. The problem is that the usual fake right populists are just another way of controlling the working class – sowing false consciousness. The truckers in question are a small percentage of all truckers (20%ish if that) and they are certainly not supported by the majority of Canadians. The main party supporting them is the so-called Peoples Party, fully right wing and neoliberal. plus the extreme right of the Conservative Party. All part of the game to bounce the working class between fake leftists and fake rightists, the oligarchy just keeps on winning.
Rogan is not in the Trump camp, do you people ever stop spinning nonsense? Do you believe the nonsense you spin? It is one thing to be purposefully misleading to achieve your objectives, but another thing altogether to actually believe your own deceptions. The latter leads to failure.
It’s obvious you have no sympathy for the thought of ” Freedom”. Freedom from being dictated to for daring to want “Choice”. You sound like a toady to me – one who obeys criminally stupid so called laws. Three days is SFA to make the Govt come to its senses – those protesters are real true patriots who believe in their own ability to demand respect & fairness.
There is a discussion about the truckers in the Cafe. Let’s stay with Professor Hudson’s excellent essay here, and not drive all over it.
Truckers will be the first victims of AI technology. Self-driving trucks are here. Day after tomorrow. That fact is the ugly truth rarely talked about.
Max asks: “Who are these bad Americans? Why isn’t Michael not exposing bad Americans, defining their core common characteristics, instead of letting them hide behind the American label?”
Dr. Hudson reveals the macro-view of how the US governs Europe, and other nations. He doesn’t need to “name names” because it’s all the ultra wealthy in America: Big Tech, Big Banks, ie JP Morgan, Goldman Sachs, and several Multi-Billionaires playing in the US financial system. Think: Jeff Bezos, Warren Buffett, the heads of Big Pharma, Hedge Funds: Black Rock, most of the CEOS of Big Insurance, Real Estate, and, obviously, The Fed.
No generalization, please. There are good CEOs in our Fortune 500 companies. Not all support the Empire.
It is essential that we protect the good and innocent. For too long the bad has used the good and camouflaged itself behind labels. Not this time.
Just look at the list of the Bilderberg attendees. How about the CFR members?
Is this a good overview of some of the SUPERCLASS, their associations, NGOs, think tanks,…?
Michael, ain’t you putting this the up-side-down way here? Should it be: European and other U. S. Allies’s real adversary is America?
America wants Europe and its allies to decouple from China/Russia, at their own cost of favorably priced commodities and comfort products. America wants them to flash the middle fingers at China and Russia every chance they get, and to engage in wars with China and Russia when they see a chance (what the fuck are you waiting for Zelensky?). America promises to SELL them armaments, LEND them money for making strategic moves of mobilization, and best of all, make themselves mortal enemies of China and Russia. Meanwhile, America itself enjoys 29% increase in trade deficits with China, because Chinese consumer products are obviously the cheapest and of best quality for the money.
In 2022, that US-Sino trade deficit is going to balloon to another 40% increase, on top of the 2021 ballon, because that so-called Infra-structure budget is going to kick in, and China has the whole spectrum of products that America needs precisely for that kind of endeavor. But that’s beside the point. America is special; America is exceptional. America has the right to order Europe/Allies to war with China/Russia, while America itself sit on the sideline, munches popcorn and hums lullabies, having the best of times.
“ The Iron Curtain of the 1940s and ‘50s was ostensibly designed to isolate Russia from Western Europe – to keep out Communist ideology and military penetration”
Wasn’t the Communist ideology a Western political idea …?
It originated in a Central/Eastern European Jewish writer called Karl Marx as far as we know.
It was a rhetorical question. :)
The government can simply print money, as MMT has demonstrated.
I don’t think this statement is true. Only the banks can ‘print’ money.
Which puts the banks in control, not the government.
No, Little Black Duck. Governments can print money and it is part of their task.
Who do you think prints China’s money?
No, I believe this is another of their deceptions which leads us to misunderstand reality.
And causes disagreement amongst their opponents (like us).
Most money is created as credit on a bank ledger and never physically exists.
The borrower is liable for the debt and interest and when the principle is repaid, the money ceases to exist.
When the government borrows……it borrows, it doesn’t create. Private savings from around the world are loaned to the govt in return for an interest bearing bond.
The govt may never repay the debt, as it issues a new bond when the other expires but it did not create the money. The money was created by banks somewhere in the world.
I’m not sure about China but as a participant in the worlds banking system, I don’t believe they would be allowed to operate in a different fashion to all others.
This is vital to understand.
This is why govt’s appear to be ‘owned’ by the banks.
This is why Lord Rothschild said what he said (re currency).
And why his mother said what she said (re wars).
Correction! Governments too can create credit for themselves – they don’t have to borrow it all from private sector banks. Here’s how: the Government issues a bond to its national Central Bank, the Central Bank issues credit (in note, coin, credit facilities) to the Government for it to spend into the economy. The Government pays then interest to its Central Bank. The Government never usually redeems the bond, just rolls it over in new issuance when it falls due. The interest due accumulates on the Government’s Central Bank account, and is dealt with thru’ Finance Ministry-Central Bank ‘smoke and mirrors’ over time. For instance, on one occasion the UK Central Bank (BOE) gifted then Chancellor Gordon Brown £300m or so of accumulated interest (by cancelling that outstanding interest on the UK’s Government debt with the Central Bank)…..
This is nickels and dimes. You’re talking about bookkeeping trickery on the interest component.
QE is supposedly the creation of money to buy the bonds involving trillions.
It doesn’t happen.
The central bank ‘buys’ the bond with a thing called a reserve asset, which cannot be said to be money.
What happens is an asset swap. The banks can only use the reserve asset to trade between themselves and the reserve bank. It is never new money to be spent into the economy.
The reserve asset will cease to exist when the central bank returns the bond to the bank.
Just as real money ceases to exist when the debt it represents is repaid.
The entity called US in this article is actually best seen as an international entity. An entity that operates as a single Concern, that is geo-politically positioned on a US-UK-western Europe (Horizontal) axis, and one that is best understood as a Anti-State.
The real fact is the EU is the adversary of the US.
They (EU & UK elites) control its monetary position and are running it into the ground and have been since in recent times the 1970s. Even longer than that going back to the end of the Civil War.
Their minons in the US then are used to attack Russia, China, Middle East, Africa, Asia etc… not for US benefit, but their own.
The US is being controlled and contained and economy wrecked by EU elites.
And this is being done by engagement with them and China.
A lot of US industry have been destroyed by pushing free trade policies that have ultimately been peddled by the EU elites. And most of those policies were not necessary to facilitate normal trade with other countries.
But this is what the robber baron money-changers do – they set-up situation to wreck an economy so they can come in and buy things up at the 10 cents in the dollar. Just what they tried with Russia in the 1990s and have tried to do to China in recent times.
South American, African and Asian countries are well aware of these practices.
Until the wicked money-changers and other investment sharks are dealt with all this conflict will continue.
Europeans got the same treatment as the American public which was de-industriaization, climate change theory, Vaxtyranny and the clean is green propaganda.
What a superb article.
I usually reply only after fully reading the article and the comments section to avoid repeating something already said, but since I feel this article is so good I’ll write this reply without reading the comments below.
Thank you so much for sharing this article with us. It was truly an eye opener. Call me naive, but until now I was under the oppressing impression that the US foreign policies where indeed on the hands of lunatics, crazy warmongers, senile leadership, utterly unloved and unlovable neocons and similar beasts. That is, the kind of people where reasoning is alien to them, and whose only pleasure in life is watching the suffering of others. It was suffocating thinking we were on the hands of truly mad, irrational people.
Now, the veil has been lifted. We can see the rationality of what is happening, even if it is an ugly sight. We can take relief that there is a predictable line of action that we can at least try to look for the best way out.
I’m not saying those hordes of beasts don’t exist. They probably do. What I’m saying is that there are also less irrational people in the shadows.
Trying to predict the future, after reading this article, my impression is there will be defections among the US “allies” soon, first one or two, but soon after a flood. That will hopefully throws us to a more sane future. Hopefully…
Again, thank you very much for your article.
Solid article. “In some ways, America has been turning itself into its own version of a gas station with atom bombs (and arms exports).” ” Cutting back that spending, and indeed recovering industrial self-reliance and competitive economic power, would require a transformation of American politics. Such a change seems unlikely, but without it, how long can America’s post-industrial rentier economy manage to force other countries to provide it with the economic affluence (literally a flowing-in) that it is no longer producing at home?”
The U.S. rose in the 19th century to become one of the major industrial powers through protectionist trade policies, as Horace Greeley pointed out in his book “The American Conflict” (1864), in the first page or so, as if remarking something well-known by all his contemporaries. Its industrial part of the economy is down to little more than 40% of the economy. I think it should do whatever it takes, internally, to regain that industrial power, so I suppose the same protectionist policies could again work well in achieving this, maybe more easily now since it still has one of the two largest economies in the world. Since Russia won the arms race with the Zircon and other hypersonic weapons while spending 18 times less (!), all it should take is a statesman to point to this outcome, and to the reality of several nuclear powers out there, amen of the well-accepted failure and cost of avoidable wars far from home (which must produce low morale among soldiers). A top statesman is what the United States lacks. It is one of the two richest countries in natural resources and maybe only one or two other countries are as energetic and fast-paced. Just like Russia and China changed their economic situation and prospects in a matter of two or three decades, the United States can do the same if it will only be honest about past policies.
I’m not sure what you mean by Natural Resources as Russia & Iran have 70% of the Proven Reserves of Gas.
The above 2 plus Iraq & Venezuela, over 50% of Crude Oil Reserves.
What the US has is the Tech for retrieval of said resources.
Still, the US has far toooooooooooo much dead weight on its books, spooks, generals, bureaucrats and other low-life non-productive big eaters.
The US changes administrations too often to have any steady policy that would last long enough to change its fortunes.
Americans will never have the benefit of the stability that Russia gets with Putin. The Biden administration is seemingly deliberately doubling down on failed policies, like reversing strong energy policies. Open border policies that value aliens over citizens, a crime surge through soros funded DA’s who are treating the most violent with kid gloves. Putting in place mandates that force businesses to close and workers to quit en masse. The list goes on and on of stupid leftist ideas that are being pushed at America’s peril.
I would argue the worlds peril as well. US has over 5k nuclear warheads. It can become a failed state given enough time with terrible policy. Still another 3 years of those left. I wonder if it will survive. Perhaps other nations should ease up on the destabilization even if the US Deep State will not stop.
Thank you Michael Hudson. An analysis that actually explains US behavior on the Saker, not as the meanderings of incompetent idiots driven by revenge for the Russo-Swedish wars, some visceral hatred of Russians, or a “wag the dog” desperate domestic political “need” for war, but as an actual strategy: the need to scare the shit out of the Europeans with the big bad Russians, split them off from Euroasia, and keep them in the US’s economic orbit. Will it work? Not likely. The Russians–and the Chinese–are in the catbird seat. All they have to do is wait–not mess things up with some idiotic need to demonstrate military strength. Believe they are too grown up for that. Here’s a bit more elaboration on what is transpiring from someone who may not have attended a military academy or taken calculus, but understands how empire actually works. http://natyliesbaldwin.com/2022/02/joe-lauria-what-a-us-trap-for-russia-in-ukraine-might-look-like/
‘ US advisors sought to privatise Russia’s natural resources and other non-industrial assets by turning them over to kleptocrats . . . . . . . . and if it wasn’t for that pesky young upstart Vladimir Vladimirovich Putin, we would’ve gotten away Scot Free.
I’ve often mentioned here, elsewhere, that the above battle will go down in history as the battle that saved not only Russia, RF, but judging by what is happening today with successive genocidal US Administrations, The Planet.
Upon sending this comment I’m going to pen a strong letter to my MP requesting that he immediately look into the possibility of a statue of Putin to replace the one in Trafalgar Square (The Pirate Nelson ), if it’s still there.
Mr. Hudson, this is a very good piece of thinking, in MHO the very Best in years. Put in short, the united states si a parasitic states. As a mexican, hope they don’t make it.
Excellent article. As usual, Professor Hudson has thoroughly depicted the current status of the US economy. Coups de chapeau! Apocalyptic conclusion for the USA empire?
Rule number 1 of economics. Never privatise your nation’s monetary supply! Rules, 2-8. See Rule no 1!
However, if you do privatise the monetary supply, then impose restrictions upon usury, such as Julius Caesar’s ‘the accrued interest cannot exceed the value of the original loan capital’, and ‘interest cannot be imposed upon accrued interest’!
If we do not begin with the ownership of the monetary supply, then all questions of industry costs, military alliances, etc, are just the ‘sound and fury’ of Shakespearean Idiots!
See Rule number 1!
The main difference between the US and China is Rule number 1! This is why China has enough high-speed rail to go around the equator, and the US has not one kilometre!
Oh, did I mention, Rule number 1, and when will Michael focus upon this Rule!
@RicG: “Julius Caesar’s restrictions upon usury, such as ‘the accrued interest cannot exceed the value of the original loan capital’, and ‘interest cannot be imposed upon accrued interest’”.
I’m beginning to understand why Julius Caesar was assassinated.
They did get the Romans to kill Jesus for them, why not Ceasar?
One of the big fish in all this is Soros who is a EU operative.
He is an enemy agent in the US. For fat euro pigs who want to get rich off everyone else.
He has never been a friend of the US or acted in its interests.
He and his associates should have been thrown out of there long ago – by Reagan.
He and his masters only like China as long as they can control and plunder it.
Now that China under Xi has exited their program, the war talk and has started.
But there were also domestic traitors such a David Rockefellar and H Bush involved.
In this one must realize that US investors are divided into 2 camps. Production in US or outside.
And this has become clear since 2016 with Trump representing the domestic camp, and his opponents in the enemy globalist camp.
Another problem causing problem in this is global US companies who want production outside US to make super-profits in the US, or survive the onslaught of foreign competition.
The US can only get deal with this downward spiral by removing foreign control and influence in every form in key areas, and place controls on its global corporations on what they can do. And reform cross ownerships and enforce anti-trust laws to break up monopolistic entities.
It will go broke if nothing is done, and this is what those outside US want. It is getting close to it now and the window of opportunity to save the bacon on this is soon to close.
Trump was a puppet of the global elite. The Rothschilds and the group helped start his empire as they always prefers to have a charismatic frontman then He was rescued from bankruptcy by the Rothschilds and the gang. His mentor was Roy Marcus Cohn a protege of gangster Meyer Lansky – think about it New York is controlled by the Jews and the only way you can become a real estate tycoon there is to be a part of the group and their puppet. Trump made his millions in New York. Trump was the pied piper (paid by the devils) to lead white American to their ruin. And he did so happily and successfully
Hudson ends with this question: “how long can America’s post-industrial rentier economy manage to force other countries to provide it with the economic affluence (literally a flowing-in) that it is no longer producing at home?”
I would say that will be exactly as long as the nations that produce this affluence continue to accept worthless fiat digital dollars and Treasuries in payment for their goods and services.
Thank you for this great and eye opener article. Hope some of the people in the West will read this very carefully and hopefully will see what is really going on in the USA and the rest of the West. We only can hope Canada, South America and Europa will be more towards Eurasia oriented and will trade more with China and Eurasia. Forget the USA they are on the economic way downhill.
Ukraine wants THAAD Missiles to “protect” itself from Russian “aggression”.
Plan B on getting that pesky war started.
Mr. Hudson’s framing is understandable, but perhaps a framing including a wider strategic analysis not conflating a network of social relations with a nation state , may aid illumination, including of notices of intent recently broadcast by the People’s Republic of China and the Russian Federation, since sole agency is never an option in any interaction.
“America’s real adversaries are its European and other allies: “
This has always has been part of the strategy, but not the whole strategy.
“The U.S. aim is to keep them from trading with China and Russia”
This a current tactic not restricted to trade, in hope of sustaining the strategy of “America”.
“The United States of America” are a network of coercive social relations whose sustainability is a function of their facility in coercing others and themselves – a practice of coercive co-operation – coercion being a component of “war” – war not being restricted to things that go bang.
China and Russia are seeking to transcend cooperation by coercion social relations by cooperative relations without coercion.
Hence China and pose an exitential threat to “The United States of America”, since they offer an option to European and other allies within the coercive social relations self-designated as “The United States of America”, options of transcending coercive co-operation by co-operation without coercion.
This is the Pandora’s box which was opened wider when some in Independence Square “gained” plain bulkas without salt or drink to aid digestion, the “United States of America” “gained” an albatross, and the Russian Federation accepted a new member, with the complicity, via useful foolery, of Mr. Brzezinsky, Ms. Victoria Nuland and others.
“Mr. Hudson’s framing is understandable, but perhaps a framing including a wider strategic analysis not conflating a network of social relations with a nation state , may aid illumination,but perhaps a framing including a wider strategic analysis not conflating a network of social relations with a nation state , may aid illumination,”
Like Mr. Hudson’s framing, Mr. Ritters framing is also understandable and in some degree emulative whilst affecting access through different portals.
whilst over-extension is often a function of non-co-operation and divisions of labour.
In some countries, basic macroeconomics (taught also to future lawyers, sociologists, government bureuacrats and such) is called “political economy”. Here we see why.
Excellent article. Connect economics with geopolitics and you get highly informative and relevant content. A must for all curious and thinking folks. No comparison with fake, physics envy ridden, neoliberal “economic science”.
“In some countries, basic macroeconomics (taught also to future lawyers, sociologists, government bureuacrats and such) is called “political economy”
Whilst in others it is called economics by design, the transition encouraged by Mr. Marshall’s Principles of Economics published in 1891 seeking to obfuscate “human agency” including in facilitating “wars” in various forms in parallel, including subsequent forays in (neo) Imperialism the highest form of Capitalism in the opinion of Mr. Lenin, after the moments in an ongoing lateral process designated by some “Great Recession/Crisis of Capitalism during the period from circa 1861 to circa 1890.
Literature / source request for paragraph 23, paragraph 4 of “Oil diplomacy and America’s dream for post-Soviet Russia” (” In cases where foreign governments […] When they quadrupled their oil prices in 1973-74 (in response to the U.S. quadrupling of its grain-export prices) […] )
Dear Saker and Community,
I would kindly like to ask whether you, anyone, could please provide some literature suggestions for me regarding the context quoted above, connections between ’73/’74 oil prices and grain prices rise connections, if any of you know, and help me just understand that background.
I did find some related literature, but cannot read through it all, i also do not have the access to literature I’d want to have right now;
I do understand it should be obvious or common knowledge, maybe by asking in the comment section you can cut short my way to understanding
If anyone would just put it into short terms, I’d be very happy too of course.
Sorry for cutting into your discussion and thanks for replying,
thanks for putting up the work of this website and the articles
This “the U.S. quadrupling of its grain-export prices” was new to me. The usual reason given is for OPEC targeting nations that had supported Israel during the 1973 Yom Kippur War.
I tried to investigate it and this was all I could find, so far:
Dr Hudson mentions his ‘quadrupling’ on page 12 of his own paper ” The Road to Debt Deflation, Debt Peonage, and Neofeudalism” (February 2012):
“The United States does not need this recycling to create money. The government can simply print money, as MMT has demonstrated”
Sorry, but this is bollocks
galerkin, you’ve just demonstrated that you do not have a first clue of Professor Hudson’s work to a level that is embarrassing. Perhaps you should go and read his work first before you call bollocks. In return, I call your comment incredibly uneducated.
(I cringe if Professor Hudson should do us the great favor to look into the comments here, after his crisp and clean and clear explanation, he has to see bollocks like this!)
“The United States does not need this recycling to create money. The government can simply print money, as MMT has demonstrated”
It all depends what kind of central bank you have. In EU, ECB is independent from other branches of government, its only mandate is price stability (low inflation), it is neither obligated nor allowed to manage monetary policy with regard to other criteria, like unemployment rate. For such central banks, statement of dr. Hudson is in theory not valid.
Most of Western central banks are at least in theory independent in relation to executive branch, although their mandate can be wider then only price stability.
Dr. Hudson however is refering to MMT school of economic thought which aims to show that there would be no disaster if monetary policy (printing money) was put in hands of more democratic branches of government, like for example National Treasury. In this framework government could indeed print money.
And in fact even under current system of course central banks do not operate completely outside political expediencies. Which is in my opinion good thing.
Central banks should absolutely not be independant from the executive/legislative branch (or in other words, from the people). Monetary policy is key to achieve full employment with decent standard of living for the 99%, while central banks’ « indépendance » is just a way to ensure that the equity and debt detained by the 1% doesn’t depreciate, ever.
“The line of least resistance for U.S. strategy seeking to maintain control of the world’s oil supply while maintaining its luxury-arms export market via NATO is to Cry Wolf and insist that Russia is on the verge of invading Ukraine – as if Russia had anything to gain by quagmire warfare over Europe’s poorest and least productive economy. The winter of 2021-22 has seen a long attempt at U.S. prodding of NATO and Russia to fight – without success.”
Unlike Brer Rabbit, who fell for Br’er Fox’s Tar Baby trap, Russia simply refuses to punch this Ukrainian Tar Baby trap the US has set for it. Instead, Russia begs not to be thrown into Br’er Rabbit’s “dreaded” Briar Patch of economic sanctions — in which it was born and bred. All the Neocons’ tricks are now exposed as bluster and bluff. All they have left is a false flag event. Cue up Erik Prince’s Blackwater/Academi mercenaries.
The High Cabal controlling America has made sure that all the economics taught in the US are junk economics. A privately owned Central Bank like the Fed is a disaster for the country, but great for the Banksters. Money creation should be done by the Treasury Department like in the 19th century. That is why they direct the anti China fear and loathing campaign, China has a government owned Central Bank.
This is a wonderfully explained article, hat’s off to Prof.Hudson. These kind of articles are required to be printed and distributed all over the world, to awaken the masses everywhere to let them see what is being made of their foolish ignorance, from where and what all the evil arises and prevails in this world.
Fantastic article. Thank you Michael and Andrei. And by the way the only reason why Macron met Putin in Moscow is the forthcoming French presidential election : affirming his « presidential » stature, delaying his candidacy like he has more important matters to take care of. Putin is a very polite man.
Nice. A complicated subject that is well presented.
The greatest enemy of knowledge is not ignorance, it is the illusion of knowledge. Great text. Russia does have 6 columns. Russia and China will suffer unbearable attacks for the existence of their civilization. Zone B writers must now write about it. The world needs good writers, practical writers. The story belongs to whoever writes it. Europe also needs to be unmasked. Germany is racing to be defragmented, with these green vassals. Russia has to deal with its 6 column. If this is not dealt with, russia will be the next germany.
Germany continues with its mysterious schizophrenia. It is difficult to penetrate behind the scenes in Germany. Journalists are afraid to talk about Germany. If Germany sanctions Russia, the effects will be:
1. Germany’s power will stop working.
2. German engineering and its economy will stop working for lack of energy.
3. Germany will become a failed state and America will not be able to save it as the dollar is worth 2 pieces of toilet paper.
4. The EU will not bail them out either, as their energy companies will be in the same state as Germany.
Germany canceled the Russian RT, and now it will probably go against Russia. Russia also has as its 6th column the American Christian evangelicals, who erode Russian behavior and way of being. They have the god mammon and work for the company. There are 6 columns. The German government is in sync with Biden, and Germany is confused. Olaf has an asymmetrical face, one eye larger than the other eye. He was a mediocre lawyer. Meritocracy is leaving Germany.
Does German engineering and industry really depend on Russian gas? Blah blah threatening sanctions and this and that. The fact is that Putin decides what happens, not a country that failed in WWII and has been taken over by the US ever since. Modern Germany is a complete joke. A country ruled by a bunch of matron women and men who act like women. Russia will take Ukraine if it wants to… just as China will take Taiwan whenever it wants to. There’s nothing more to it….really. Yes, we will have sanctions, but the truth is that Putin and Xi don’t want war. This is theater. It’s already repetitive. These guys have no choice but to double down on their “threats” because they’ve invested so much in them. This is all a “face saver” to Homer Simpson’s prevailing type of reasoning. Germany has now almost achieved its “Great German Reich” envisioned by Hitler 80 years ago. Russia should NEVER have allowed the remnants of Nazi Germany, West Germany, to annex East Germany starting in 1989 and then take over all of Eastern Europe again through their EU conspiracy. The only solution now is to completely destroy this entire Fourth Reich of matron women and feminine men, once and for all. Britannia (in the British East India Company of the day before) Ruled India through the Subsidiary Alliance, India was not a centralized state in the past, but there were several smaller sovereign states.
Subsidiary alliance terms:
The Indian state was prohibited from having any foreign relations unless approved by the British.
The state had to refrain from waging any wars.
The ruler of the state had to maintain an army commanded by British officers, to maintain public peace. In fact, the ruler had to grant territory to this army (this rule was applicable in larger states).
Smaller states had to pay cash tribute to the East India Company
The state had to accept an English resident to stay at its court, who would monitor the administrative activities and maintenance of the army.
The state was not allowed to hire European workers without prior authorization from the British.
(English resident – American ambassador)
The subsidiary alliance was invented by France and this is how Britain and France ruled Asia.
After the second world war, the US never left Europe or East Asia (Japan and South Korea) these countries are under subsidiary alliance, including the Middle East and Latin American countries.
USA is a super empire that the British and French always dream of. If Russia and China don’t solve the 6th column, they will be like Germany now, and the planet will come out of humanity’s golden age. Tackle the 6th column with wit.
@A.Deplorable on February 08, 2022 · at 10:14 am EST/EDT
@RicG: “Julius Caesar’s restrictions upon usury, such as ‘the accrued interest cannot exceed the value of the original loan capital’, and ‘interest cannot be imposed upon accrued interest’”.
I’m beginning to understand why Julius Caesar was assassinated.
Exactly Mr Deplorable! These laws against usury, at least, in part, (no doubt a large part!) led to his death! It takes a lot to be assassinated by ones own Senate, by those who are there for the ‘gravy train’, and to hell with the people! Sound familiar to 21st century politics?
Astonishingly, the problems we face today are the same problems we were facing 2000, 3000, 5000 years ago! And we have still not solved the ‘monetary problems’!
And we still fight the cult of debt bankers, and their efforts to ‘steal the world’!
Australia followed US diktats regarding demonising China and it cost the nation $20b in exports. The US picked up $10b of that trade. Then Canberra dropped a $100b contract with France so it could purchase totally unsuitable nuclear subs from the US under AUKUS.
With this Ukraine gambit I believe that the US is trying to steal European export markets by making energy so expensive that Euro industries become uncompetitive.
There is a time, of course, to simply break off diplomatic relations with the USA.
It should be made clear to the US Ambassadors across Europe that if they do not believe in free trade, then they will not in future have the ear of any European leaders nor senior administrators.
It should be made clear to all US corporations operating in Europe that they must publicly condemn breaches of free trade by US governments or have their license to trade in Europe irrevocably removed.
It must be made clear to all US military personnel that they have no right to engage with any European citizens bearing arms and that, if they breach such matters, then they will be prosecuted under civilian law in Europe without any form of diplomatic protection.
It is time for Europe to tell the USA where to get off and they can only do that en bloc.
As soon as the French, the Germans, the Poles, the English, the Spaniards and the Italians think that this is about petty squabbles over who is top dog in Europe, they are done for. The USA is currently top dog and it is an absolute scandal and an enduring moral excrement to boot.
If Europe wants to ever be free of the USA it has to set some boundaries, stand firm and be prepared to break off diplomatic relations.
It won’t get anywhere through appeasement.
“All countries have come to realize that the world has reached a point at which no industrial economy has the manpower and political ability to mobilize a standing army of the size that would be needed to invade or even wage a major battle with a significant adversary. That political cost makes it uneconomic for Russia to retaliate against NATO adventurism”
This sounds reminiscent of Norman Angell’s argument that the integration of European economies would make war economically pointless. He did not say that this meant that the European powers would not go to war. They still did.