by Hugo Dionísio for the Saker blog
8 years of fortified constructions, tunnels, bunkers and endless armament depots, two months of repositioning of reserves and military human losses, the structure finally begins to collapse. The human losses are in the tens of thousands of young people, not so young, national and foreign, and after all the inevitable happens. The comedian who is president, in his daily videos from some bunker or mansion, has always resisted in doing what the opponent does when he considers that the effort is too much for the gain: retreat to a more solid line of defense, saving men and equipment.
The official narrative, shared endlessly over and over again, about “the most important victories since the second great war” for the domestic side, will not be despising, for the decision to fight to the last man. After all, any decision, to call this major defensive fortification line as lost, implies a total reversal in the narrative propagated by the North Atlantic corporate press. It´s a must to first prepare the public who are the relentless followers of such narratives. Telling them the truth is not an option, as this would mean effectively saying the opposite of what has been said, namely regarding the inevitable outcome of the conflict.
In yet another war used as a cycle of capitalist accumulation, a fact that can be clearly stated in the reversal of the trend in the world arms market until 2014, which placed the two indirect contenders (US and Russian Federation) in direct competition and with very close numbers, this situation has, as it were, reversed, with the USA today being the undisputed leader in world arms sales, with around 2/3 more in sales value than its largest direct competitor (Russian Federation).
It doesn’t mean that they sell more quantity…. They mainly sell more expensive. The data at hand brings light about the use of war and the military industrial complex as an instrument of the capitalist accumulation cycle, or, on the contrary, as an instrument whose fundamental objective is national defense.
The “Global Fire Power 2023” which establishes the “Fire Power Index”, places the US in first with 0.0712, Russian Federation with 0.0714 and the RPC with 0.0722. In other words, the top two appear tied and the third is very close. The 4th place, India, is much further away, with 0.1025. What does this tell us about the role of each army?
The first question that comes to mind is, how is it that a country that spends $800 billion of its military budget (and we do not include here the “dark money” of the secret services, nor all the research paid for through federal programs that also goes to military ends), has practically the same firepower as a country that spends $65 billion, and little more than another that spends $290 billion?
The answer lies in several aspects: 1) the North American military-industrial complex is private, therefore, it aims to pursue profit, the enrichment of an elite and the concentration of wealth, with the state being an instrument of this accumulation; 2) the other two have a military-industrial complex that is essentially public – not exclusively – mainly in the most sensitive areas, and is not intended to do more than fulfill its public role, i.e., to guarantee an effective national defense capable of defending the country’s sovereignty.
This difference is paramount, because while the first makes weapons to sell, namely and as many specialists say, producing luxury “toys”, very sophisticated and complex, and therefore very expensive, both in the act of purchase, maintenance, training and technical requirements of personnel, and when in combat, usually very prone to breakdowns. On the contrary, the other two contenders try to produce, as cheaply as possible, effective, efficient and durable products. The fact that they are mostly public companies allows them to buy at cost price, and even when they are private companies, the price they demand is conditioned by a market dominated by the public business sector, whose accumulation dynamics are controlled by the state, in defense of what it understands to be the national interest. This, the US, they call it “lack of economic freedom”. For the richest 1%, of course!
To these two vectors we can also add other variables that will not fail to have great importance: any of the economies in the 2nd and 3rd places are less financialized and, in this sense, less speculative, especially in strategic sectors, which is reflected in lower prices and a lower weight of the rentier sector on industry; both countries have a very large installed industrial potential, which allows for almost exclusive national production, with production chains almost entirely in national currency and therefore very little vulnerable to speculative attacks or disruptions of other kinds (in the case of the Russian Federation, still has the advantage of having access to all raw materials in its territory); finally, both countries have closed capital accounts (at least in part, since the Russian Federation has been closing with the sanctions and the RPC only opens in certain areas and with many limits), which allows the establishment of production chains of high added value, but of low comparative cost, when their product is evaluated nominally, in $. The advantages we see here in defense are also visible in other areas such as space research and development, railroads and banking. This is the only way to withstand massive sanctions (as in the case of Russian Federation), and the only way to use the accumulated potential for a more rapid development of the country (as in the case of the RPC).
Let the defenders of neoliberalism and the “opening” of markets come out now and argue that countries defend their sovereignty better that way, and not through the aforementioned protectionist measures. Were it not for these measures, the two economies in question would already be absolutely devastated, either by sanctions or by speculative attacks, and their peoples would be in the most absolute poverty, from which they had such difficulty in escaping. It is no accident that the two major US demands for changes in the RPC are related to the privatization of its huge (about 30% of the country’s ownership) public corporate sector (mainly banking) and the full opening of the capital accounts. It is no accident, either, that the US has accused the Russian Federation of enhancing its currency through capital controls. This is why the White House says that a “regime change” is necessary. This is not in the interest of “their” democracy, it makes it more difficult for trojan horses to enter.
But if this is one of the most important factors in dispute, one of the others, energy, has already borne fruit, at least in the short term. According to Bloomberg, the US will become the world’s largest gas producer by 2022. All at the expense of the transition of the European purchase, from Russian Federation to the US. If, for the USA, this “opportunity” (as Blinken said) was fantastic, for Europe, it shows its overall fragility, in political, economic and cultural terms. To get an idea of the cost of “decoupling” from Russia and “coupling” in the US, in terms of energy dependence, just look at the trade balance data for November 2022, the period when these countries were engaged in filling up their reserves of natural gas and other fuels.
The data provided by Golden Sachs says that for France, last November was the most negative November in the last 20 years, in terms of trade deficit (- 15%). Sweden, like France, also had the worst November in 20 years, one of only 5 in 20 to have a deficit, and this year’s was much higher than last year’s, which was already negative and reflected Ursula’s “big” decision to start buying gas “on the spot” instead of conclude long-term contracts (the “decoupling” was already in preparation), as would be advisable. Germany, while remaining on positive ground, nevertheless had its worst November in 18 years. In terms of chemical and pharmaceutical industrial production (which require gas), it is in free fall, dropping to much lower levels than in 2010, in the midst of the subprime crisis. The sky-high price of American gas makes production unviable, and on the other hand, the lack of gas, due to the closure and destruction of the NStream by its “allies,” means that one has to choose between industrial production on the one hand, and maintaining the strategic gas reserves on the other, so necessary for heating in the middle of winter. Germany has opted for the closure and relocation of companies. Some to the RPC, others to the USA, which even has a competitive pharmaceutical sector (nothing happens by chance).
Japan is also in a complicated situation, also with the worst November in the last 20 years. This will not be unconnected to the decision to buy oil from Russia again, namely by returning to the Sahkalin project and without complying with the price ceiling that it had previously “contributed” in the G7 to set. This decision will certainly not make its Atlanticist masters very happy.
The conclusion of one of the Golden Sachs economists who released these data is that “the world export champions are no longer so”. This is what comes of giving up national sovereignty and letting the “allies” make the decisions that are up to each one of them.
The total submission of the G7 countries and the EU to the dictates of NATO, an organization created to groom them, which today is confused with the European Union itself; the blind application of all economic and financial sanctions and guidelines; the lack of protection mechanisms for the respective internal markets… All this has the effect that we are witnessing, which had been foreseen by so many silenced people throughout this time. How they must hate to be right.
And while everyone maintains such openness, the Atlantic “ally” adopts protectionist measures aimed precisely at capturing the best that the industry of its “friends” still has to offer.
After this and the announcement – as a diversion for the recent military defeats – by the European Union summit, all that remains is to see our prime minister, president and other Atlanticist left and far right-wingers come out to defend the rapid entry of Ukraine, Georgia and Moldova, in the European Union… All for solidarity, of course! I want to see when these people, who have so many companies that live off European structural funds, stop receiving them… I’m sure they will find fault where there is none. After all, that is their practice!
Do they want change? They must do everything upside down!
It is the same as everything else with the U.S. They are spending around 20 bil to subsidize total extraction. If you go on Google Earth it is a shock how many wells are seen. The fracking is destroying many areas and polluting groundwater. As we know America is being destroyed by its own leaders following the City of London.
According to the depopulation agenda, there is not going to be many people left in the States, so it makes sense to poison the ground in the name of profit as the ground is not going to be needed by any people. And the people won’t complain about it, just like the people didn’t complain about US actions across the Third World. In fact, the American people applauded and supported US actions in the Third World.
Short of being able to obtain Russian lands and resources, there is no choice but for America to curtail and degrade its population and economy, else America will just explode in an uncontrollable fashion. An explosion would destroy money, and the rich elite only care about their money, hence no explosion must occur. To make things controllable, the regime is deflating the tires on the car, while slow poisoning the passengers at the same time, so that when the car comes to an inevitable halt there is no drama and hysterics, just acceptance by the sick still alive that the ride has come to an end. So that which is unsustainable comes to a “dignified”, controlled ending, instead of an uncontrollable capital destroying explosion.
The Deagal Report predicted a third or half decrease in the American population by 2025, I’m hopefully still going to be around by then to assess the validity of that report.
I don’t think the US is going to be around much longer. The maniacs in charge don’t look to be coming to their senses any time soon.
If there is a global nuclear war there won’t be any post-apocalyptic survivors due to hundreds of thousands of tons of radioactive fallout. Chinese prophecies say that a handful of remote islanders might survive, but this seems exceedingly unlikely. A simple rainstorm will kill everything it touches. As for bunker dwellers, studies have shown that they tend to murder and eat one another, but even if they did someday emerge they would die immediately from the poisoned biosphere. The whole idea of nuclear survivors is a pernicious fantasy.
This analysis overeggs it a bit. The primary reason for vast difference in spending is down to graft, bribery, and outright theft. That the military contractors are private facilitates this moneygrubbing, but the proximate cause is the same as for everything else wrong with the US: the DC Bubble People with their bottomless appetite for sin, venal or otherwise, and their grand delusions of omnipotence.
At a certain point no one will believe lies any more. It will not matter how many emails you send, your troops will not be able to defend themselves. It will not matter how much money you send, it will not get you a tangible result. It will not matter how nasty or dirty your assassins behave, they will be disloyal. Like rats on a sinking ship.
The MIC in the US is designed for profit 1st. The equipment is marketed and sold at gunpoint. You need an s-400, you get a patriot.
The Russians actually feel threatened, with good reason, and produce their equipment to defend their country 1st. It would be fun to see who would be from whom if there was no coercion.
Hugo Dionísio one of the measures of economic wellness of nations is its debt to GDP ratio. A country with a high debt-to-GDP ratio (higher percentage) typically has trouble paying off their external debt generally owed to outside lenders. For example, Russia’s GDP debt ratio is 12% while USA is 133%, Canada is 87%. This is an indication of economic wellness of a nation. High debt ratio leads to inflation and slow growth of the economy. Economies likeUSA print money to avoid default.
Selling weapons needs instability and fear. USA is a master on creating instability and this plays well into their weapon sales.
USA spends more 37% of the world total on its military. One may say spending this amount to defend everything could really mean that they don’t defend anything. Russia spends its budget on specific hardware that when used can crimple the opponent so relatively a smaller amount spent on quality is a better deterrence then when a nation spends lots of money on quantity.
On a note of military expenditure, Canada spends more on their military than on any other national program. Much of the expenditure by Canada on its military is promotion.
Much of the article deals with private (corporate) vs public sectors (government) of the economy. For example Public sector: Canada 22%, Russia 40%, Israel 73%, Norway 32%, USA 13%
You attribute Russian and Chinese efficiency to government control. Most economies are a mix of private and public sectors where some are more private while others are more public in how society is organized. Military is part of the public sector and they procure weapons from the corporate sector like Kalashnikov in Russia and Lougheed-Martin in the USA. In both cases the corporations are subsidized by the public sector the tax payer.
I totally agree with you. Russia also buys from corporate sector. THat’s right and if you read the article I also say that public property in Russia includes strategical sectors, but they also have a corporate military sector. However, since the most important companies are public, it’s possible to guarantee military spending in a low level, because they buy really expensive stuff (like planes, ICBM’s, Hypersonics) at low prices. ANd that public productive chain produces an enormous pressure on private companies to maintain also the prices at a low level. And when you compare an american product with the equivalent russian one, you find that the russian, even when you talk about export prices, they are cheaper than the american or western ones. Of course, the fact that Russia is not a indebted country (I saw something about 2% GDP of external debt this year, but I’m not sure), is also another advantage concerning the cost/benefit relationship. Israel is also a good example of my thesis. A Small country with a great army that need to buy less expensive weapons. Also, they benefit from USA subsidies. THe one that pays the highest cost is USA that, as you say, has the smallest public company military sector. THat’s why USA uses not only fear, but also diplomatic and economic pressure to sell it’s weapons. THat’s the only way when you sell expensive stuff. ANd you are right that even the private companies n USA are subsidized by taxpayer money. ANd that’s another argument in favour of a public military sector, imo. After all, through that you remove a lot of third part agents, promoters, middle men contractors and, of course, you can remove a lot of money directed to rentist shareholders. Also, public companies doesn’t have to spend that much money in lobbying, marketing and so on. They know they produce for the national defense. If they also can make money from exports, it’s even better. That’s what’s happening with Russia, Israel or even China. The profit, instead of going for shareholders, goes to more weapons. It’s a win win relation when you look from a simple public interest perspective. The closed capital accounts helps also a lot, because you maintain high added value goods at a low cost, comparing with other sources like USA. That’s why we must look at Russia, or China military spending using PPP GDP, and not nominal GDP. If you use PPP metric you can get a better idea (but no the real one even so) about the real value of their military spending. But I agree with all you’ve said, of course.
I live in Canada., Our economy is a mix of public vs private sectors. Some 30 or so years ago the ratio of public 35% to Private 65% is now shrunk which is due to deregulation. Economic decisions in many cases are left to the goodness of the entrepreneur and we all know how that goodness works. Profit is left in the hands of the corporations while the losses are spread over the taxpayer.
For years I have spoken out against outsourcing by the private sector in Canada. The entrepreneurial goodness in Canada is measured in making a quick dollar rather than a long-term project at home in Canada which creates jobs and economic stability.
For example, in the town where I live, 40 years ago we had 7 sawmills, today we don’t have any. The corporations refused to modernize and the mills closed down. This is happening now as well with Canfor, one of the largest lumber producers in BC.
Generally, the sawmills in small communities were producing secondary products and they represented stability and jobs and a tax base for small towns. Today we ship logs to Mississippi where mechanization and low wages mean quick profit and more of it. We do this with all our resources thus we have a boom-and-bust economy. This does not happen in countries where the public sector is in balance with the private sector i.e. Norway. Our economy is characterized by unemployment and instability and this is all due to exporting of raw materials and tertiary jobs to USA, China and Mexico.
A couple of years ago a former paratrooper (who went on to became a socialist activist) told me ‘To end most of the wars in this world you just need to nationalise the arms industry’.
The main difference is that in Russia the wealthy have to avoid interfering in politics, in the US the wealthy own the politicians and the Government.
The comedian who is president, in his daily videos from some bunker or mansion, has always resisted in doing what the opponent does when he considers that the effort is too much for the gain: retreat to a more solid line of defense, saving men and equipment.
Which is a good thing as it helps to end the SMO/CTO more quickly than otherwise. I feel sympathy for the average non-Nazi Ukraine soldier who is literally a pawn and cannon-fodder for NATO. But I hope Russia is able to quickly advance to the Dniper River, Odesa, and link with Transnistria and accomplish the demilitarization and de-Nazification of Ukraine. Let Poland, Slovakia, Hungary, and Romania have whatever is left and establish a DMZ to stop NATO’s eastward push.
The western spoon-fed Russia dun it meme will wear thin before much longer on an ever greater disenfranchised Euro public with the resultant backlash making the yellow-vest protest movement in France look like a girl-guide’s picnic. I’m sure about this! There’s already a visible/noticeable deterioration in the general public’s mental health. Crimes of violence rise exponentially in Euro-Land.
Bloomberg is reporting “Yellon Says US to take Extraordinary Steps to Advert Default” as the treasury will run out of money for borrowing this coming June. I wonder if cutting back on spending for overseas wars, e.g. Ukraine, will be on the table? I mean like is it not the very thing that is breaking the camel’s back at the moment? Alas, U.S. leaders only know how to double down. I bet they’ll cut some poor people’s social security before they cut back on anything making mayhem and destruction in the world.
The US Treasury could just as easily create debt free digital US Treasury Notes as it now issues US Treasury Bonds, that pay interest to pay down the US Treasury debt of $39 trillion.
Of course they can, and that is what they will eventuallly do. Only thing stopping them from doing it now is this pesky law on the books about a debt ceiling that needs congressional approval to have it lifted a bit. With the Republicans in control of the House in the U.S. Congress right now, they’ll want to extract a few concessions from the Democrats before they do. Question is what will be the concessions they extract. Get ready make some popcorn.
They said no debt ceiling concessions, the old, cant be questioned during times of war.
But the kap is wrong, what he is describing is full blown socialism, and that leads to too many moochers and not enough producers that leads to an expensive shortage of random goods.
We are well on our way, i’m just surprised the cap didn’t recognize it as being such, and why it cant be said pubically although privately the system has been gaining momentum since 1965 equal right act and all that went w/it.
Ending poverty with one extra food stamp a day.
“But the kap is wrong, what he is describing is full blown socialism, and that leads to too many moochers and not enough producers that leads to an expensive shortage of random goods.”
Might not be so many “moochers” if people could actually get jobs that pay for anything more than the bare minimum. Don’t think anyone who found their way to this site deserves minimum wage. Tons of people willing to work, just not willing to be slaves to maniacs nor pay anymore taxes to fund the war machine.
Empires always feel indomitable, unassailable when holding power: but power is an illusion, as history cries its warnings.
Taxes are not necessary to fund US government spending.
“If that mischievous financial policy which had its origin in the North American Republic (i.e., honest Constitutionally authorized debt-free money) should become indurated down to a fixture, then that government will furnish its own money without cost. It will pay off its debts and be without a debt to the International bankers. It will have all the money necessary to carry on its commerce. It will become prosperous beyond precedent in the history of the civilized governments of the world. The brains and wealth of all countries will go to North America. That government must be destroyed or it will destroy every monarchy on the globe!”
The Times of London newspaper, opinion-editorial commentary, 1865