Tuesday, November 26, 2013

Ukraine Turns to Russia and China

Like a stolen bride, the Ukraine slips back into Russian orbit. Not my term but Reuters to make sure your mind is primed for mail order bride imagery of a backwards nation and not a worthy nation the West has been courting for years. The Washington-Brussels bloc is threatening the Ukraine the only way they know how: with money. This is because the Ukrainians said the pivot back to Russia is purely due to economics. The Chinese bought 5% of all of the Ukraine (roughly equal to Massachusetts) for agricultural use. The UPI labelled this as odd news, but looking a step back it is bigger news. Ukraine is defying the US-EU team in what may be an early step in the rollback of American progressive imperialism power.

Not wasting any time after the fall of the Soviet bloc, the US pillaged and looted the Eastern European and former Soviet pieces thanks to the likes of Jeffrey Sachs, Harvard, Robert Rubin's Treasury Department under Larry Summers' direct guidance, George Soros and other Wall Street firms. Harvard's endowment did not reach billions just by shrewd investments, raping the hard assets of a bankrupt region were needed. This was one of the premier the international crimes of the '90s that never is reported because Eastern Europe and Yeltsin's Russia embraced democracy while it happened. Anne Williamson's book never did find a publisher. On the political side, the US pushed for democratic reforms and NATO membership. NATO membership for the Ukraine made little logistical sense, but the US would hint at it for twenty years to antagonize its downtrodden rival, Russia.

The recent push to flip Ukraine into Western orbit was the Orange Revolution. The country politically looks split east vs. west, and there are multiple players at work. The opposition party that was aligned with the Orange revolution seems standard EU-integration, woohoo progressive ideas crowd. The Ukrainian elite in 2005 faced a normal post-WW2 threat. The American deal is familiar. More democracy for more money. That was 2005. The game has since changed, but the West is using the same tactics. Blackmail with IMF money offers. Smear the nation as a racist backwater right as it hosts a major international soccer tournament. Push for the release of convicted former prime minister Yulia Tymoshenko (attractive female political prisoner). Standard Western pressure propaganda. Protests in response to this shift popped up out of nowhere immediately and involve imagery of the imprisoned former prime minister (flags may say paid by US State Dept
Protesting for American Media
 but they're made in China). Spot the CIA and Western NGO workers in protest pictures.

America still thinks the same methods will work as if the world around them has not changed. America is weaker in every regard, and the Russians and Chinese have made strides in soft power as well as strengthening their financial positions. America's financial position has deteriorated, and their solutions forced on client states in financial dire straits have been rather stern. Oil above $100 has flushed plenty of dollars into Russian coffers. Russia and China have both been importing hundreds of tonnes of gold (officially released numbers). China is rapidly turning their dollars into anything tangible with a recently announced $1 trillion loan program with African nations. Coming after their "respect all forms of government" speech, they just want to secure natural minerals and resources. It is an appealing alternative compared to the DC message of aid for progressive reforms. The Ukrainian land purchase is the same hard asset investment just a different avenue: food. Doing the deal and broadcasting to the world that they do not care the form of government a nation uses, Ukraine should feel confident that come financially difficult times, they can use Chinese financial resources in exchange for land with no questions asked what happens politically inside their borders.

Something even bigger might be at work. While it has disappeared from the American media's nightly news bullet points, the United States almost bombed Syria in an attempt at regime change. That was all at the end of August as the NY Times claimed the US should bomb Syria, even if it is illegal. A G-20 Conference and online uprising by the American electorate later, the war never got off the floor, Obama delayed, Putin swooped in, Assad breathed a sigh of relief and then Obama was calling Iran. This all happened within a roughly thirty day period. Another sixty days and the US strikes a generous first step deal with Iran about their nuclear program. If the talks were secretly going on for roughly a year, why go to the brink of war in August? A lot of favorable features for Iran with hard money payoffs and loose rules for them to follow. If the US is the leader of the other side of negotiations, how will they get Iran's patrons Russia and China to agree to stronger sanctions in the future? They won't. USG in retreat.

This entire Ukrainian episode of man to man talks and pivoting is happening in the wake of whatever happened in September that caused the US to back down. The US went from speeches to the UN on red lines, bombing with muscle and regime change to calling said regime's primary patron to cement sanction relief and slow down nuclear ambitions. Maybe the Chinese and Russians finally used a Suez option, as the Treasury Department's TIC data shows a steady decline in foreign purchases at a time where the FLOW of bond purchases matters more now than ever. The UST 10 year yield has crept up ever since taper talk and losing buyers would accelerate a rise in yields, bumping the cost of money for all loans. It is financial weaponry. It is effective considering the entire US recovery is built on ZIRP and government loans for auto and educational consumption. Our FIRE needs low rates to continue, the security of our corporations need that marginal buyer, the elite need it all to hold together for the current aristocracy to stay in power. The Ukraine defying the wishes of the US-EU crowd may be a solitary move, but it might be the first tributary of what becomes a steady river.


peterike said...

The looting of the Soviet Union is fascinating to me, but as you note, it's not easy to find information on it. Do you know a good book or website that goes into just what went on?

Son of Brock Landers said...

"Collision and Collusion" was a great one. Anne Williamson's testimony to Congress alone is a good source. Anne Williamson had a book ready to go but for some odd reason the publishing world never let it see the light of day.

Anonymous said...

The Rape of Russia by Anne Williamson

"Old news of course but it is very hard to find on the web now so I thought I should post it here to preserve it."