U.S. Plays Weak Hand Against Russia With Economic Prestige On The Line

IBD Editorials ^ | September 5, 2008 | JOHN BROWNE

[Kaslin]

Just as the dollar is being pushed up by predictions that the United States may survive its current economic troubles and potentially lead a global recovery, recent developments have threatened to dispel America's remaining economic mystique, which in large part is responsible for its apparent prosperity.

With its invasion of U.S. ally Georgia, Russia has boldly asserted its regional power and has shaken up global economic calculations. Although Russia's move again showcases America's murky strategic foresight, more important will be the U.S. response. If America overplays her hand, which I fear she might, the nation will be revealed to be a paper tiger and an economic has-been.

First a word about bungled statecraft — when I served as a member of the English Parliament, much of my tenure was during the Cold War. In the early 1980s, I was appointed as the liaison to Soviet Politburo member Mikhail Gorbachev on his first official visit to the West.

Options Are Few

It became apparent to me that Mr. Gorbachev would become the next Soviet leader and his intentions were, if not benevolent, at least not belligerent. My views were in the minority, but Prime Minister Thatcher, when I briefed her, was highly focused. Toward the end of Mr. Gorbachev's visit, the "Iron" Lady announced: "I think I can do business with his man!"

[ken21]

>Greater strategic confrontations with Russia are looming, particularly with respect to Ukraine.<

si.

[Ras al Putin]

“Some critics may argue that Russia would never pursue such policies, as their own citizens would suffer equally. However, if the 20th century teaches us anything, it is that the Russian leadership is never reluctant to impose privations on its citizens, and the Russians themselves have an amazing capacity to endure hardship.

In contrast, the governments of Western Europe and the U.S. in particular are acutely dependent on public support. In the U.S., in fact, economic and geopolitical strategy is geared toward keeping American consumers living beyond their means. Any policy that asks for economic sacrifice from voters is dead. A battle of political will fought with economic tools is a war the U.S. cannot win.

The danger is that U.S. leaders believe their own propaganda and actually pursue such a confrontation. The U.S. economy’s biggest asset is the lingering effects of its prior economic pre-eminence. The failure of an economic confrontation with Russia will shatter this remaining prestige. With its weakness thus exposed, investors and creditors will pull up stakes in the U.S. and send our economy into a tailspin.”

---

Yep. Look at how Russian government treated it’s own citizens, hostages in Beslan and that Moscow theatre. Notice the terrorists didn’t really try that tactic anymore after seeing how Russia deals with hostage situations. With an oligarchy comes certain advantages.

[saganite]

With an oligarchy comes certain advantages.

THe ability to kill your citizens at will is an advantage?

[WoofDog123]

“In the U.S., in fact, economic and geopolitical strategy is geared toward keeping American consumers living beyond their means. “

Utterly true. It still amazes me that the US is actively involved in a large conflict using a high% of troops available for deployment to the theater yet the US consumer sacrifices NOTHING, nor is asked to.

[WoofDog123]

“THe ability to kill your citizens at will is an advantage?”

in geopolitical terms, absolutely. It means you can pursue almost any policy you want with near-zero regard for public opinion, up to a very high level of stress.

As a counter-point, do you see how it is a distinct disadvantage for the US to be so dependent on public support and opinion for the iraq occupation?

Geopolitics/realpolitik is not moral. Despots have more leeway in the public opinion/welfare category.

[saganite]

I certainly hope you don’t think in those terms and no I don’t believe it’s really an advantage. The Germans didn’t practice it in WWII ( before you go off on this one consider who they chose to kill and why) and Napolean didn’t. The Romans defended a citizen’s rights. So, you’re talking mainly about such societies as the USSR and Pol Pot’s Cambodia.

[stboz]

Maybe we can send Jorge to beg for a little oil.

[newnhdad]

It hurts to say this but Georgia is lost. We will make a good show of it, but it’s lost.
The next frontier is Ukraine. Those people will need our help this winter. $4 gas will be a fond memory once the soviets and Immanuttajob start screwing with the oil supply.

[WoofDog123]

“The Germans didn’t practice it in WWII ( before you go off on this one consider who they chose to kill and why) and Napolean didn’t. The Romans defended a citizen’s rights. “

I do wonder what % of people living in the roman republic and early empire at various points in time were citizens. My understanding is that by late empire even citizens didn’t have a good deal at all.

Germany in the 30’s-45 was increasingly a police state. I do not believe public dissent by a german citizen in germany by late 30’s was a viable option. Obviously we are both ignoring the selective dislocation and eventual extermination of jews, gypsies, etc.

The US has very little flexibility on how to improve its economic and military posture. Despite a multi-trillion dollar budget, increasing troop levels and equipment is a very difficult proposition. The government cannot even suggest bread and circuses might be deferred a bit for this purpose. 60 years ago this country was quite different in this regard.

I could talk more on this, but need to do something. I would offer that, for *short-term* advantage, despotic control offers a lot more flexibility. Thoughts?

[JSteff]

“THe ability to kill your citizens at will is an advantage?”

Sure, it means never having to say you are sorry. Anything for the good of the state.

Realistically it was for the good of the state and citizens. It did work though, the terrorists have stayed away.

Remember what Kurtz said about clarity and will. Terrorists fear that kind of clarity and will. Note that we have NOT been attacked since 9/11, because our Presidents clarity and will concerning preventing terrorism.

[Sandreckoner]

The idiocy of economic “commentary” in this article is astounding.

[Sandreckoner]

“Browne, a former member of the U.K. Parliament, is now senior market adviser for Euro Pacific Capital, a U.S. brokerage firm specializing in nondollar investments.”

This pretty well explains the entire tone of this ‘editorial.’

I particularly appreciate how the U.S. is an economic has-been, and everyone apparently realizes it (after all, John Brownes are around to tell them), but they keep “funding” the United States because, apparently, they’re morons, and will only stop doing so when this stark truth is laid bare to the world, at which point they’ll lose their shirts.

[nathanbedford]

I do not think that it is true that Georgia is lost to the West and to freedom. This is true so long as we have access to Georgian ports on the Black Sea coast. I do concede that the breakaway provinces have effectively established their independence and they are beyond recapturing; nor does the United States have any interest in seeing them restored to Georgian sovereignty.

So long as the pipeline remains in Georgian hands free of Russian control, or even if there is only geography enough remaining to build a new pipeline to the Black Sea, the main strategic value of Georgia to us can be preserved provided the government is not subverted. Our second strategic interest, a potential air base for a logistic connection to Afghanistan and for a possible strike or threat of strike against Iran, remains.

I think we should begin, indeed I have no doubt we have already begun, seriously infiltrating weapons systems into Georgia and perhaps even a trip wire of troops to discouragefurther Russian incursions. Ideally, this could be done with other Western nations in NATO participating. The result would be a Mexican standoff along the lines of the 38th parallel in Korea, but our strategic interests would be preserved.

[DaveTesla]

“despotic control offers a lot more flexibility”

Didn't they already try that with horrific results?

And this time they will get it right?

The U.S. can not afford to hand over the Baku-Tbilisi-Ceyhan pipeline, period.

[Ras al Putin]

“The Germans didn’t practice it in WWII ( before you go off on this one consider who they chose to kill and why)”

Sure they did. Jews and Gypsies weren’t the only ones sent to concentration camps.

[WoofDog123]

“The U.S. can not afford to hand over the Baku-Tbilisi-Ceyhan pipeline, period. “\

of course not. where on earth did I say that? specific citation?

[WoofDog123]

“So long as the pipeline remains in Georgian hands free of Russian control, or even if there is only geography enough remaining to build a new pipeline to the Black Sea, the main strategic value of Georgia to us can be preserved provided the government is not subverted. Our second strategic interest, a potential air base for a logistic connection to Afghanistan and for a possible strike or threat of strike against Iran, remains.”

Hello again!

It is interesting, isn’t it? The US media has essentially ignored a major turning point in world affairs with the georgia invasion. I expect a domino effect in the coming weeks and months, as clearly Russia/Putin isn’t going to back down. Additionally, russian de-recognition of the georgia government opens the possibility that they will attempt to offer an alternate government which deposes the prior.

The move in the dollar since the invasion says far more than I can in this post.

I found the tiger-shoot interesting, in that a tiger was chosen for his foto-op. Nothing is accidental at that level of power - why send that message to china at this moment?

[WoofDog123]

“but they keep “funding” the United States because, apparently, they’re morons, and will only stop doing so when this stark truth is laid bare to the world, at which point they’ll lose their shirts.”

The issue here is that it is true that they ARE helping to fund the US deficit. This is a terribly big issue which is being totally ignored by the media and both candidates.

I repeat - no one with any power or position is even talking about it.

[eyedigress]

Is the 6th Fleet Flag Ship still in port? Did Cheney visit the region today? I’m actually asking since I didn’t have time today to keep up.

[DaveTesla]

“of course not. where on earth did I say that? specific citation?”

I was making a statement.

The comment,
“The US has very little flexibility on how to improve its economic and military posture.”
is utter nonsense.

The Russians are no match for us.
We are merely trying to resolve the situation with Georgia
diplomatically and peacefully.

This article is just Europeans acting as they were in WWII
and the cold war, cowards (Briton excluded).
Seems the only ones willing to stand up to the Russian aggression are ex-Soviet oppressed country's.

[WoofDog123]

thanks for your polite reply!

If Bushgov says today they want 200Billion to increase DoD funding, what do you think will happen? The economic potential is there, but politically, it hasn’t happened, and likely will NOT happen.

“The comment,
“The US has very little flexibility on how to improve its economic and military posture.”
is utter nonsense.”

as above

“The Russians are no match for us.
We are merely trying to resolve the situation with Georgia
diplomatically and peacefully.”

Conventionally, if we are willing to open full hostilities with a nuclear power, yes then it is likely we can burn the russians in georgia, sink their ships, etc.

This would have consequences that are not acceptable to bushgov or NATO, thus the fact it is possible is not that relevant. Russia is in a not disimilar position vis a vis its energy supplier status with europe.

The next obvious flashpoint is Crimea, uf the Ukraine doensn’t blink.

To put in other terms, the fact that a large % of the population actively opposes the iraq invasion/occupation, despite casualties which are miniscule compared with anything previously done, says more about the political element Bushgov has to deal with than anything. How would today’s populace deal with Omaha beach?

[nathanbedford]

It is interesting how the matter has dropped off our media's radar screen. Perhaps that is just as well because these decisions which are very delicate and require many allies to turn a blind eye should be taken in the dark and not in the glare of a presidential election.

I cannot imagine why China might throw its lot in with a one trick pony like Russia at the cost of so many options.

[Cringing Negativism Network]

IBD is admitting, it is folly for America to send our industrial base to Russia’s communist ally, the Peoples Republic of China?

(no, didn’t think so...)

[nathanbedford]

Last I heard the ship was anchored just outside of port because of required depth and problems created by ships which were sunk by the Russians.

Last I heard Cheney was in Ukraine where he promised that America would bend its efforts to get them into NATO.

[eyedigress]

Thanks, The adults are still in charge and can’t allow Russia to run rough-shod over the ones who were allowed to break away.

[WoofDog123]

“I cannot imagine why China might throw its lot in with a one trick pony like Russia at the cost of so many options.”

Perhaps, thus the tiger shoot. It came after China did NOT openly support the Georgia SSR invasion.

Geography beckons, for china the long-term economic potential of Siberia has to be an objective.

[DaveTesla]

"If Bushgov says today they want 200Billion to increase DoD funding, what do you think will happen? The economic potential is there, but politically, it hasn’t happened, and likely will NOT happen.

We do not need a $200 Billion dollar military increase
to back down the Russians and keep them military in
check.

As far as collapsing the current oligarch regime we need not
nuclear but economic warfare.
One sure fire way to topple the regimes is to open up
Alaskan oil and gas while simultaneously completing a
pipeline from Iraq to Midyat Turkey.
Such a pipline would bypass the Straits of Hormuz.
This would also put an end to all the Russian / Iranian
mischief.

Bring down the price of oil to under $40.00 bbl. while
bypassing their control.

As a member of OPEC Russia's export earnings have allowed
Russia to increase its foreign reserves from $12 billion in
1999 to some $470 billion at yearend 2007.
Most if not all of these reserves come the price of oil.
Control of oil and gas coupled with the strangle hold
on breakaway republics and parts of Europe is what
gives the Russian oligarchs their power.

Russia attacked Georgia for the Baku-Tbilisi-Ceyhan pipeline
and nothing else.

“the fact that a large % of the population actively
opposes the Iraq invasion/occupation”

God, I get tired of hearing that from the media.
Nobody likes war.
That being said, the only ones I hear screaming opposition to the war are the
Marxist media and associates.

I guess if the media keeps saying the public is against the
war enough they can bring about defeat like they did in
Vietnam.

Ever stop to think that we have a “Volunteer” military
and no problem meeting our enlistment quota?

The war is not unpopular except if you are a leftest
rooting for the regimes we are taking out. Simply put, We can and we will.