GayPatriot

The Internet home for American gay conservatives.

The Ukraine crisis – and the dollar’s decline

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We know the Ukraine crisis is hot, with Ukraine and Russia accusing each other of terrorism and east Ukraine basically expecting a Russian invasion. But what interests me is the larger backdrop: the erosion of the U.S. dollar as the world “reserve currency” (or centerpiece of global finance and trade).

You see, the more President Obama tries to isolate Putin, the more he pushes Russia and its trading partners – such as China, India, Germany, Iran – to speed their efforts to integrate their economies and financial systems, to the exclusion of the U.S.

Consider the following news items. None are earth-shattering, but each reveals a bit of the picture.

So, Russia annexing territory (the Crimea) is not really a big deal to Washington; it triggers token U.S. sanctions. But Russia trading with its own neighbor (Iran), in a way that bypasses the dollar-based financial system and thus the U.S. ability to eject little countries from world trade – that gets Washington’s attention. That tells you where the sore spot is.

To continue:

Do you see where this is going? Not toward Russia being isolated. Maybe, in time, toward the U.S. being isolated.

UPDATE: Ordinary Russians are only annoyed, not frightened, by U.S. sanctions.

How the wheel turns!

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We’ve gone from liberals who’d make fun of former GOP standard-bearer Mitt Romney (on Russia), to…well…Russians openly mocking President Obama.

Now being remembered, a typical example of liberals who made fun of Romney:

Arianna Huffington
@ariannahuff

So I guess if Romney is elected we can get ready for a new cold war with Russia.
#justwhatweneed
8/31/12, 8:56AM

Romney got in his (well-justified) “I told you so” last weekend:

Why, across the world, are America’s hands so tied?

A large part of the answer is our leader’s terrible timing. In virtually every foreign-affairs crisis we have faced these past five years, there was a point when America had good choices and good options. There was a juncture when America had the potential to influence events. But we failed to act at the propitious point; that moment having passed, we were left without acceptable options….

Meanwhile, Obama’s sanctions on a few individual Russians, and calls to try to make their stock market go down and stuff, have provoked their contempt:

“The US and EU sanctions against Russia are absurd and unreal,” State Duma Foreign Affairs Committee Deputy Chairman Alexander Romanovich told Itar-Tass…“This is an operetta, and we can only laugh…”

Ordinary Russians are none too impressed, either.

UPDATE: Russia and China drawing closer together. “The worse Russia’s relations are with the West, the closer Russia will want to be to China. If China supports you, no one can say you’re isolated.” It’s just like Obama, to not get that.

Potluck

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These items have been all over, and deserve to be noticed here at GayPatriot.

Liberal bias, in media & academia? Why, yes.

More people seeing that the Emperor Has No Clothes? Thankfully, yes.

  • Obama is under water on the Ukraine crisis. 42% approve his handling, 43% disapprove.
  • While a bipartisan majority support sanctions against Russia, they’re mainly older people, because younger people say no. Among the Obama-voting 35-and-under, 55% are against it.

IRS / Tea Party scandal as real as ever? Yup.

  • Great, daily coverage at TaxProf Blog.
  • Yes, Lerner targeted the Tea Party, and even what she called “organizations woven by the fabulously rich and hugely influential Koch brothers”. More Koch Derangement Syndrome. Some people are on too much Koch!
  • Lerner continued last week to plead the 5th. The IRS will give up all her emails, supposedly; I put it that way because enough time has passed that only God knows what they may have scrubbed.

FROM THE (OTHER) COMMENTS: In the other Koch Derangement Syndrome thread, some fine comments are relevant here.

  • runningrn says “The Koch brothers didn’t even crack the top 10 when it came to the top political donors. In fact they are way the heck down the list at number 59…The 6 biggest union donors in American politics gave 15 times more to mostly Democrats…”
  • And Annie gives us the WSJ link.

One should ask why the IRS doesn’t target all that union money? Or target, to coin a phrase, “organizations woven by the fabulously rich and hugely influential George Soros”?

AND SOME FOLLOW-UPS:

  • Rep. Alan Grayson (D – FL) won’t be charged after allegations that he physically abused his wife. GP talked about it here. The video evidence – which was incomplete (having gaps in it) – did not support Lolita Carson-Grayson’s story. Nonetheless, a judge granted her a restraining order against Rep. Grayson. We’re still waiting for the new feminist campaign, “I BELIEVE YOU, LOLITA!”
  • Gary Lyngar answers his son, who had made a splash by claiming “I lost my dad to Fox News”. Hint: The son was about as real and honest with us as you’d expect from a writer who whines about his parent’s politics. As the elder Mr. Lyngar puts it, his son was “dead wrong” and “a lot of it’s his perception of what’s going on and not reality”.

Did the U.S. seek trouble in Ukraine?

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To be clear: Putin is a tyrant, and I condemn him. I condemn Russia’s military actions against Ukraine, and I support the people of Ukraine in being free and determining their own government. (Should it still be called the Ukraine, in English? Some say no.)

Having said that: As human beings, Obama and Kerry tend to be hypocrites who overplay their hands. And they strike me as surprised that Putin has offered military resistance to their wishes in the Ukraine crisis. Which raises the question: What are their real wishes? Did U.S. agencies organize the most recent Ukrainian revolution?

If so, the U.S. security apparatus would have motive in plenty. Russia supplies Europe’s oil and gas via pipelines that go through Ukraine. Putting those pipelines under control of an anti-Putin, anti-Russia government would be payback for a lot of Russian moves, not limited to Russia’s harboring of Edward Snowden (of the NSA surveillance revelations).

As to evidence of U.S. meddling: first, the Voice of Russia claims to have revelations about it, including a story that Ukrainian protestors had been murdered by their new government as a ‘false flag’ operation to foment the revolution. But Voice of Russia isn’t good enough. After all, the KGB (Putin’s first career) specialized in putting out disinformation. Is there other evidence?

In February, the Financial Times leaked a phone conversation allegedly between US assistant secretary of state Victoria Nuland and the US envoy to Ukraine (Geoffrey Pyatt) wherein they explicitly plan who will be in Ukraine’s next government. The ZH link provides audio; the Nuland voice famously says “F**k the EU”, near the end.

That’s still not hard evidence, because Nuland/Pyatt might have been fantasizing or delusional about the extent of their influence. Overall, although motive abounds for the U.S. to have brought about the Ukraine revolution, the evidence for it is still weak.

Regardless of the answer here, my feelings are mixed. It would be nifty if President Obama really cared about promoting freedom in Ukraine and/or U.S. interests, especially after he failed to support them in Iran’s aborted Green revolution of 2009-10. On the other hand, I’m against murdering protestors; and the U.S. shouldn’t be making trouble on Russia’s doorstep without a very compelling U.S. security interest. It would be just like Obama to overplay his hand with something like that. Containing Putin is one thing; aggressive (and losing) games of brinksmanship with Putin are another.

Speaking of the U.S. possibly losing the game: Russia is keeping up the the financial threats I mentioned a few days ago. Russia’s foreign minister, Lavrov, affirms that sanctions would “hit the U.S. like a boomerang”. And yes, China is siding with Russia against Obama’s threat of sanctions (so China may join Russia in dumping U.S. Treasury bonds). FWIW, India also seems to lean toward Russia. It is not at all clear that, in a diplomatic contest between Obama and Putin, Putin would be the one who ends up isolated.

Russia threatens financial retaliation if Obama proceeds with sanctions

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I’m amazed to see financial threats being made this openly. Like real military threats, real financial threats are usually made via backchannels. But, then again, President Obama has threatened Russia openly with sanctions.

MOSCOW, March 4 (RIA Novosti) – An adviser to Russian President Vladimir Putin said Tuesday that authorities would issue general advice to dump US government bonds in the event of Russian companies and individuals being targeted by sanctions over events in Ukraine.

Sergei Glazyev said the United States would be the first to suffer in the event of any sanctions regime…

Glazyev noted that Russia is a creditor to the United States.

“We hold a decent amount of treasury bonds – more than $200 billion – and if the United States dares to freeze accounts of Russian businesses and citizens, we can no longer view America as a reliable partner,” he said. “We will encourage everybody to dump US Treasury bonds, get rid of dollars as an unreliable currency and leave the US market.”

Is it just bluster? As recently as last year, the answer would be yes. But China holds approximately $1 trillion in U.S. Treasury bonds; and if Russia ‘goes there’, China will not want to be left behind.

And for several years now, China has been working with its partners (including Russia, Japan, Brazil, the UK, France and Germany) to set up facilities for trade & finance that would enable them, collectively and at long last, to be independent of the U.S. dollar. Even before this crisis, some experts were predicting that 2014-15 would see those efforts bear fruit.

Leave it to John F.-n Kerry and Barack Obama to be just stupid enough to push Russia and China further along a road that they are already well-and-gladly on.

Russia’s threat also comes via its Foreign Ministry: [Read more…]

Obama in Fantasyland

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V picked up on the Obama Fantasy aspect of the Ukraine crisis earlier; consider this part 2.

President Obama thinks he can hit Russia with economic sanctions but, as they did last summer in the Syria crisis, Britain is siding with Russia for practical purposes.

Of course the Telegraph article tries to make it sound nice, in the lede:

Britain is preparing to rule out trade sanctions against Russia amid fears that the Ukraine crisis could derail the global economic recovery.

Further down is the truth:

…the capacity of European leaders to react decisively has been hampered by the dependence of much of the European Union on Russian oil and gas…

On Monday, Mr Obama…said he had warned Russia that if it continued on its “current trajectory”, it would face “a whole series” of economic and diplomatic steps that would leave it isolated.

However, there was little sign that the increased pressure was doing anything to deter Mr Putin…

It is not a foregone conclusion that Russia is the one facing isolation. This is a measure of how much American influence has been lost on Obama’s watch.

WaPo Is Partially Correct

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The Reliably Left-Wing Washington Post*says that Obama’s foreign policy is “based on fantasy.”

FOR FIVE YEARS, President Obama has led a foreign policy based more on how he thinks the world should operate than on reality. It was a world in which “the tide of war is receding” and the United States could, without much risk, radically reduce the size of its armed forces. Other leaders, in this vision, would behave rationally and in the interest of their people and the world. Invasions, brute force, great-power games and shifting alliances — these were things of the past.

They are correct to note that his foreign policy is based on fantasy and executed by middle school girls who think they can taught their adversaries into submission by telling them their actions make them uncool and will lead the cool kids to reject them.

They fail to note that his economic, health care, energy, and national security policies are also based on fantasy. e.g The fantasy that socialism works if it is administered correctly.

*Now a property of Jeff Bezos of Amazon; how convenient to own the newspaper that shapes the opinions of the politicians who regulate your business… and your competition.

UPDATE (from Jeff – ILC): More links.

  • The Reliably Left-Wing New Republic says Mitt Romney Was Right About Russia. Gee. Admitting that you were wrong about someone, long after your admission could make a difference, is…nice?? or?
  • Obama plans financial attacks on Russia. I believe that the extent to which this is real (not just bluster) is the extent to which it will backfire. For years, China and Russia have been building alliances and facilities to kick the U.S. dollar off of its international pedestal. Any success that Obama has in squeezing Russia economically will push them along that road.