Three Ways The Ukraine War Revealed A Feckless And Hollow NATO
Over two millennia ago, the Chinese sage and philosopher Lao Tsu told his countrymen, “There is no greater danger than underestimating your opponent.”
Unfortunately, that advice is more often than not ignored. Some always stand on the sideline, cheering on one side, and are carried away in sheer arrogance as they “underestimate their opponent.”
We saw a vivid demonstration of that last week. Lindsay Graham, the Senior Senator from South Carolina, dusted off the old pejorative that Russia is just an oil and gas company masquerading as a country.” It’s an old slight that goes back at least 20 years to when John McCain coined the phrase, and it’s been a favorite of Graham ever since. It reveals a complete disregard for the Russian Federation and its capabilities, as demonstrated currently.
Graham has unveiled here the perspective of the Western Powers toward Russia in its Special Military Operation in Ukraine.
When Russia invaded Ukraine a little over a year ago, NATO, including the United States, embarked on a primarily economic course to oppose Russia. There were three dimensions to this “economic warfare.” First, NATO and the European Union would impose sanctions on Russia, denying it from selling oil and gas to the West.
Next, they would expel Russia from the SWIFT International Settlements System. This was financial isolation.
Finally, NATO et al. would make Russia a pariah nation, an isolated county with no friends or allies.
Reviewing how this economic conflict has turned out after a year, it becomes apparent that most of NATO’s goals have failed. It appears that most of these actions were ad hoc, with little pre-planning or consideration for their impact back here at home,
The first strategy has been the so-called sanctions. More correctly, a boycott of Russian goods, mainly oil and gas sales. With much fanfare, US President Biden announced in March last year that America would no longer purchase Russian oil and gas. For the sake of clarity, what Biden is instituting was a boycott. That’s when a buyer halts their purchases of a good or a service, and boycotts are much less effective than sanctions. Sanctions are when a seller stops their sales.
In September of last year, Europe stopped purchasing Russian gas, but that was because the Nordstream Pipeline was blown up.
The effect of these boycotts has been that the energy price has skyrocketed for Americans and Europeans. Higher energy prices were the primary catalyst that began the worldwide spate of inflation we are still battling.
Overall these misnamed “sanctions” were designed to cripple Russia’s economy. The US State Department estimated that Russia’s economy would drop like a rock and enter a near-depression state. That their GDP would drop by 10% to 20%. However, the results are now in, and the Russian economy fell by only 2% last year and is projected to show solid growth in 2023 and beyond.
Score one for Russia.
The second dimension of this economic war between NATO and Russia was that NATO would provide Ukraine with enough weapons, munitions, missiles, and equipment that Ukraine would take a commanding position on the battlefield. The assumption was that economically backward Russia would be unable to keep up with the superior production of war materials supplied by NATO.
In a shocking turn of events, Russia has out-produced the West in delivering war supplies to their soldiers at the battlefront. As incredible as it may seem, with nearly all of Europe, the United States, and NATO lined up on Ukraine’s side, Ukraine is running out of supplies. Among other American Defense Contractors, Raytheon reports that so much has been given to Ukraine that America’s stocks are running dangerously low. And for many of the high-tech weapons, it will be months and, in a couple of instances, years before production can re-stock US weapons and supplies.
In January, Navy Secretary Carlos Del Toro put the matter more starkly. He said the US might have to decide between supporting Ukraine or providing for our own defense. It’s that serious. And another indication that we in the West have underestimated Russia’s capability to continue to produce weapons for the front.
Finally, NATO and the West moved to make Russia a pariah country. An isolated nation that would decline economically as the rest of the world turned its back on Russia.
Decidedly that has not happened. After the West expelled Russia from the SWIFT International Settlements system, President Vladimir Putin turned to China, which immediately welcomed Russia into its own Cross-Border Interbank Payment System, CIPS. It was a stunning reversal for NATO, particularly for the United States. The SWIFT Settlement System, after all, uses US Dollars for all their transactions. In contrast, the China-based CIPS System will use the Chinese Yuan — clearly a blow to the US Dollar’s status as Reserve Currency.
An international consortium of Nations, NATO has relied on its moral authority to call out the Russian Special Military Operation as a rogue action. Indeed, few countries rallied to Russia’s support for the first months of the conflict. However, nearly all the southern hemisphere countries refused to condemn Russia. Recently, even that is beginning to change. Last week, Russia welcomed China’s Xi Jinping in a formal state visit. This level of diplomacy strongly indicates that these two countries are on the verge of forming one of the most significant alliances of the past 100 years, as Chairman Xi said on his visit.
Russia is a founding member of the BRICS group of nations: Brazil, Russia, India, China, and South Africa. There are new signs that the BRICS members are strengthening their ties with Russia, due mainly to the economic benefit of Russia’s readily available oil and gas. Remember, both India and China are major importers of oil.
And it all points to a significant global trend. The countries with up-and-coming economies, what Wall Street likes to call the “Emerging Markets,” are uniting, growing closer, and establishing viable trade routes and agreements and the financial systems to facilitate trade and cross-border investments. The Chinese CIPS System will play a central role in all this.
Beyond the economic considerations, there is a growing unease with Western Leadership. Last year US President Biden visited a long-time ally, Saudi Arabia, asking that the Saudi increase their oil production to help ease American inflation. Biden’s request was flatly rejected. Moreover, the Saudis raised their oil price later, a stunning rebuke indicating that America’s power and influence, at least with the Saudis, is waning.
While the “Developed World” of Europe and the United States, collectively the members of NATO, are exhibiting the stress of economies under energy and inflationary pressure and are unhappy with the course of the war in Ukraine. Significant riots are reported throughout Europe, from Paris to Denmark to Berlin citizens are progressively uncertain about the Ukraine War’s outcome and their economic fortunes.
It may be time for Western Leaders, like Senator Lindsey Graham, to reconsider their previous appraisal of the Russian Federation.
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