Greetings Readers,
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The United States, and indeed the world, can temporarily discount Russia as an economic power. The country is virtually falling to its knees. Experts predict Russian GDP will contract by 4.2% this year. The reason for this decline is apparent, a litany of problems. Among them is the reduction in the price of oil by 45% these past six months, sanctions have taken a heavy toll, the severe 50% devaluation of the ruble, and its continuing European dispute over Crimea and Eastern Ukraine. And there is more bad news to come, as the economy worsens.
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The murder last week of Mr. Nemtsov, a prominent opposition leader has drawn attention to the anti-Putin movement apparently growing and has expanded its voice in the West as well as domestically. The Ukraine dilemma, in a previous article, I suggested Putin should have invaded industrial-mineral rich Eastern Ukraine shortly after the Crimea annexation and created a fortified land bridge to the island. He should have swallowed the bitter medicine all at once and preluded the lingering festering sore that it has become because santion countermeasures by the West could not have gotten any worse than they are at present.
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The uneven on and off conflict with Ukraine has become a costly embarrassment to Putin and the Kremlin. Vladimir would not listen and at this stage of his heavy-handed power grab he will not take good advice from anyone, and why not? One reason is Putin is estimated to have 200 billion dollars, not rubles, dollars invested and stashed away in and outside of the country for a rainy day. That in its self breeds confidence and arrogance in the mind of a fatalist. More likely of course is his popularity so far, at this moment in time, is boarding on 86% due to Russian patriotic pride and the ever-presences of nationalism. Putin has done a stupendous job controlling the press and the industrial Mafia-like Oligarchies by using brutal police tactics of which he so easily manages. (This topic is well addressed in a highly recommended fasinating tome published just last month, Red Alert by Bill Bower, a longtime investor in Russian Corporations) How long will this Putin phenomena continue is any ones guess.
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Russia’s intervention into the Ukraine came about because Putin felt the motherland was threatened and he did not want NATO infringement and Western leaning neighbors on his doorstep. I ask the reader was the strategy reasonable or was it not for the invasions? Russia as any large vulnerable nation desires to maintain a sphere of influence and to create a buffer zone for is country against, in this case, against the West. The argument has merit. Would not the United States become offended by any alliance of potential enemies, read China-Russia, deployed in Mexico, Canada, or economically debilitated Venezuela? Of course not. Other moot points at this writing is European banks have provided west Ukraine 17.5 billion dollars to jump-start their faltering economy, and as of today Poland has requested the U. S. furnish them Tomahawk missiles. Approximately 3,000 boots American troops are on the ground in Eastern Europe for join military exercises. That scares hell out of a paranoid Russia, and would the U. S. too if similar were deployed within our hemisphere. (The Cuban Missile Crisis of 1962)
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Moreover, the major problems alluded to in the first paragraph are not all the Russians have deal with or to be concerned with, there are a whole barrel of them should one glance below the surface. In example, the Overall health of the nation has severely declined. Life expectancy has gone south by six years in just the past few years. (from 76.3 to currently 70.45) The causes are apparent, alcoholism, smoking, illegal drugs, and poor winter diet with a declining birth rate. Russia loses 0.5 of it’s population annually due to low birth rates, premature deaths, and emigration. The trend will certainly continue as the economy flounders. I have not mentioned one of the most fatal quietly held confidental distractions, “Big time and small time corruption” that is a prevalent killer for any nation while adding to its diminished freedom within the borders of the world’s largest land country.
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Meanwhile on the other side of the globe, the U. S. has gotten a breath of fresh renaissance air. The economy is steadily recovering from the crisis years begun in 2007. Because of shinking oil prices by way of controversial domestic fracking projects and international agreements the citizenry enjoys $2.00 gas or less, the Wall Street owned stock market has reached record heights of prosperity. Corporate bonuses are at their highest level ever. If only the American worker could join in and share the wealth. Real wages have not risen since the late 1980’s.
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It is plain to see the U. S. economy is on an upward course while Russia’s is badly, desastously you may say, falters to new sub-levels. That is not to say there are not domestic and international problems requiring our attention. We do. Racism, inequality, deficits, and gridlock to name a few. The often Media driven maligned containment of ISIS and the necessity to maintain a perpetual home guard against Moslem extremists. These can be handled with time and patience as U. S. duly spends nearly a trillion dollars on military and intelligence preparedness.
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With this scenario there is one serious ingredient missing that should not be overlooked: A sinking nation in severe decline similar to the Russia we see today and one we will have to negotiate with in this decade and the next may become desperate under severe economic pressures as did Japan in the 1930’s. Russia could act in what it feels to be its survival mode and in its best interest, and NOT in the best interest of world peace. In spite of its massive natural resources Russia will not be an economic superpower again in our life time, but undoubtedly is one of significant military prowess. A country with thousands of nuclear warheads that has the means to launch them toward Europe or other countries. Those countries that have caused the Russian Federation severe economic pain.
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All the Best.
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Ron Miller
