Tuesday, December 23, 2014

Sanctions on Russia: Punishing Your Friends and Enemies Alike

In a post concerning Western sanctions on Russia, Mike (MIsh) Shedlock refers to an an interview with CNN, during which President Obama said that the US-led Western economic sanctions on Moscow are working, and credited the American-led effort with a downturn in Russia’s economy and the decline of its currency.

But then the President admitted that Russia has yet to pull back from its "aggressive posture" in Ukraine, which is to say Russia has not reversed its aquiescence to the request by the autonomous government of Crimea for accession to the Russian Federation, a request based on an overwhelming positive referendum vote.

In other words, the sanctions have so far entirely failed to achieve their alleged purpose.

Mish also quotes George Friedmann of Stratfor, a private intelligence agency affiliated with the CIA, who recently visited Russia:
The Russians pointed out that economic shambles was the norm for Russia, and prosperity the exception...

Russians' strength is that they can endure things that would break other nations. It was also pointed out that they tend to support the government regardless of competence when Russia feels threatened. Therefore, the Russians argued, no one should expect that sanctions, no matter how harsh, would cause Moscow to capitulate.
Or again, sanctions have so far entirely failed to achieve their alleged purpose, and moreover, could not have been  expected to achieve their alleged purpose, but they have enhanced the popularity and authority of the Russian leadership.

Further, Friedmann states:
... Ukraine is of fundamental strategic importance to Russia. Even if the East received a degree of autonomy, Russia would remain deeply concerned about the relationship of the rest of Ukraine to the West. As difficult as this is for Westerners to fathom, Russian history is a tale of buffers. Buffer states save Russia from Western invaders. Russia wants an arrangement that leaves Ukraine at least neutral.
In other words, Russia is being sanctioned by the West for acting to protect its vital interest, something any soveign state is bound to do.

Mish also quotes a letter from oilman, David Lifshulz, addressed to Jamie Dimon, chief of JP Morgan, and other members of the financial elite. Speaking of the consequences of the recent US orchestrated attack on the Rouble, Lifshultz pointed out that:
Russian agricultural sanctions [imposed in response to Western sanctions on Russia] are as nothing compared to these new currency sanctions [i.e., the consequences of Western action]. ...The Western attack on the ruble essentially blocks all imports into Russia...
Lifshulz then notes that if the West were to cut Russia out of the SWIFT international payments system it would  prevent EU payment for the supply of Russian oil and gas, leading to termination of supply with dire consequences:
... the international financial system will collapse if Russia unilaterally ceases to supply energy to Europe... If Europe cannot buy Russian natural gas and oil, it will die. It will drag down the entire international financial system. This time ... issuance of trillions of dollars of credits will not save it as that cannot overcome a shortage of natural resources. The supplies of natural gas and oil from the stans and central Asia between China and Russia are essentially under Russian control. If they decide to block it, that potentially could remove 24 million barrels a day from the world economy and huge amounts of natural gas.... What will the EU and the United States do? Launch nuclear missiles at Russia?

... if Russia pulled the plug on the EU by stopping their natural gas and oil exports... it would trigger implosions in the quadrillion [dollars] of derivatives. And Russian need only do this for three to six months to achieve the desired victorious counterattack... laying the West low... there is no doubt that this is war.
But, OK, Obama has not gone stark raving bonkers — yet: he has not yet ordered Russia be excluded from the international payments system.

But he's still searching around for means to increase the pain inflicted on Russia for her rational and necessary response to the threat to her security caused by the US inspired coup d'├ętat in Kiev, which replaced the legitimate government of Ukraine with a militarized, Russophobic, genocidal, oligarch-led fascist regime whose "punitive" battalions sport Nazi regalia as they shell civilian targets in Eastern Ukraine, where the Russian-speaking people had the timerity to seek autonomy within a federated Ukraine.

And as Lifshultz concludes:
Economic war precedes military conflict as we saw when the United States, Britain and the Netherlands cut off 92% of the oil used by Japan through an embargo on July 25, 1941, which was a declaration of war on Japan as the West is declaring war on Russia. ...The West is hoping against hope that if they keep raising the ante when they have no cards, that Russia will throw their cards on the table. This will not happen. They also hope that they will be able to lower the temperature any time they want to avoid all out economic and or military conflict, but history shows that once the Pandora's box is opened it is nearly impossible to put the evils back in the box.
So the Peace Prize winner, Barack Obama, has launched an economic war on the World's only other nuclear super power, the country from which the US buys rocket engines, which offers every prospect of escalation to a hot war that may not end short of a nuclear holocaust.

The policy, so Lifshultz supposes "fit[s] into Brzezinski's goal of dismembering Russia." Thus, whereas, according Maynard Keynes, politicians are usually "slaves of some defunct economist," today, the leadership of the West is apparently, slave to the mania of Zbigniev Brzezinski, a near-defunct, Russophobic Polish geostrategist.

Related:

Fort Russ: Anti-Russian Policies of the EU Succeed at Killing the Baltic Shipping Industry

Russia-Insider: How Russian Intelligence Sees the US

Deep Resource: Moscow Confirms "Turkish Stream"

Peter Hitchens: Why Russia Is Not a Marginal Power (from 19:10 – 26:30):



Or see 1:27 where the twit, Edward Lucas, Senior Editor of the Economist magazine tries to argue that Estonia with a population of one million people is less of a marginal power than Russia.

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