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Not to Go All Lenin on You, But: What Is To Be Done? Follow the Money!, Thatís What.
The Streetwise Professor ^ | February 28, 2014 | The Professor

Posted on 03/01/2014 5:49:56 AM PST by No One Special

Russia has invaded Crimea-and hence has invaded Ukraine. No Obamaesque circumlocutions about “uncontested arrivals” can gainsay that very basic fact. The Russians have occupied a major Ukrainian air base in the peninsula, and have given an ultimatum to all Ukrainian military units to surrender their posts.

Yes. All unopposed. So I guess that makes it OK.

But what to do about it?

First: a no brainer. Eject Russia from the G8, and reschedule a meeting of the G7 somewhere far away from Sochi (as is scheduled for June). But seeing as that it is the Obama administration and various EU factotums that will make the decision, no brainer is probably asking a wee bit too much.

Second: pressure FIFA to strip Russia of the 2018 World Cup. Even though the thought of Putin blowing another $50 billion on a vanity project has some appeal.

@libertylynx suggests persuading the Saudis to turn on the taps to reduce oil prices, and hit Putin where it hurts. (Though since Obama has seriously alienated the Saudis with his Syria policy and his dalliance with Iran, there is serious room to doubt whether the Saudis would be at all accommodating.) Indeed, in 1986, the dramatic increase in oil production by the Saudis struck the USSR a mortal blow, and Putin’s Russia is almost as dependent on oil revenues as the Soviets. (See Gaidar’s memoirs for a blow-by-blow account of how the collapse in oil prices gutted the USSR. I’ve often wondered whether the Saudi action was directed against the USSR, rather than OPEC cheaters as was stated publicly, and done at the behest of the Reagan administration.)

There are some differences, though. In ’86 KSA had about 7 million barrels of spare capacity, at a time when world consumption was on the order of 60 million barrels. By producing to the max, the Saudis drove the price from around $23/bbl in December, 1985 to under $10/bbl in mid-1986, about a 60 percent drop. Now Saudi spare capacity is around 2 million bpd, when world output is around 90 million bpd. A 2+ percent increase in Saudi output would result in at most a 20 percent price decline. (Note that other producers would cut back, so that world output would go up by less than 2 percent even if the Saudis produced to their capacity.) Certainly enough to hit Putin hard, but not enough to create the existential crisis that the Soviets faced in the 80s. But every little bit helps.

Insofar as gas is concerned, the Europeans could cushion the blow of sharply reducing consumption of Russian gas by increasing use of coal, which is in abundant supply in the US because the shale gas boom has displaced large quantities of coal in electricity generation. But I doubt Europe has the stomach for that, and it could not get along without Russian gas altogether.

This leaves one last thing: crying havoc, and letting loose the accountants of war, a policy I advocated in August, 2008. There is nothing that would make Putin and his coterie of thieves and thugs freak out more than putting their billions in loot stashed in the West at risk.

The fall of the Yanukovych regime provides a perfect cover for such an operation. An aggressive search for the boodle of Yanukovych and his spawn would no doubt serendipitously uncover other illicit loot from the FSU: after all, a Hermitage Capital investigation traced connections between Yanukovych-linked companies and the fraud that the martyred Sergei Magnitsky uncovered.

This suggests a potentially fruitful asymmetric attack on Putin. Loudly and publicly announce a thorough investigation of Yanukovych monies in the West. Through back channels, tell Putin that unless he backs off-way off, like back to Rostov-on-Don off-that any dirty Russian money (and is there any other kind in Western banks-hell, even Putin pretty much agrees with this) that just so happens to be discovered during the investigation of Yanukovych will go to covering the US national debt. Then go ahead and investigate anyways, and keep track of the moneys uncovered, for potential use at a later date.

Alas, even though this is a bloodless alternative (though it would drain the blood from Putin’s already pale, Botox-injected face), I seriously doubt Obama has the stomach for it. In part because he knows Putin would lose his sh*t, and he doesn’t want to deal with that.

But here’s the thing. There’s really not much reason to be intimated by Putin’s bluster–outside the FSU, anyways. Russia has economic feet of clay. Militarily it is a pretend power, fit to intimidate other decrepit post-Soviet militaries in smaller states on its borders, but sadly outmatched against a real power. So call his bluff. Guarantee full employment for forensic accountants.

Then buy ear protection to guard against the shrieks emanating from points east and north, grab some popcorn, and sit back and enjoy the show.


TOPICS: Miscellaneous
KEYWORDS: ukraine

1 posted on 03/01/2014 5:49:56 AM PST by No One Special
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To: No One Special

Crimea was traditionally part of Russia; ethnic Russians are a large majority of the population and Russia has major naval bases there. Crimea was ‘given” to Ukraine by N. Khruxhchev, himself Ukrainian. If Putin intends to take Crimea by force, it will be extremely popular with most Russians, except for the Crimean Tatars whom Stalin deported after the war for collaboration with the German Army. I’m not taking Putin’s position, but I understand it.


2 posted on 03/01/2014 6:02:39 AM PST by laconic
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To: laconic

Khrushchev was not an ethnic Ukrainian, but he did serve as Boss of the Ukrainian SSR, under Stalin. So he felt giving Ukraine the Crimea would win over those Ukrainians who didn’t care for his rule there.


3 posted on 03/01/2014 6:07:05 AM PST by dfwgator
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To: dfwgator

He was called the butcher of the Ukraine for what he did during the Holodomor.


4 posted on 03/01/2014 6:23:08 AM PST by No One Special
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To: No One Special
Obama is Putin's "b*tch", and the whole world knows it. I didn' watch his speech yesterday, but when I heard that he was going to get tough with Putin, I laughed so hard I almost cried.

OK, I did cry...

5 posted on 03/01/2014 6:29:38 AM PST by Kenton
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To: No One Special

Personally I’m with Putin on this one.


6 posted on 03/01/2014 6:35:43 AM PST by bill1952 (Choice is an illusion created between those with power - and those without)
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To: dfwgator

The Ukrainians who didn’t care for the Soviets rule was a lot of Ukrainians given the fact that Stalin starved eight million of their compatriots to death in the 1930s (a fact famously denied by the lush Walter Duranty who was a prize-winning “reporter” for the New York Times). One of the key KBH defectors was a Ukrainian colonel who was posted to London at this time and was disgusted to see that Stalin and his Red cronies were exporting Ukrainian wheat for the foreign exchange while masses of people were starving to death for lack of bread.


7 posted on 03/01/2014 7:21:19 AM PST by laconic
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To: No One Special
Then just "shooting from the hip", no research, mind you, let me react for Putin: He goes full out in aiding Iran with the most advanced air defense missile and fighters Russia has in it`s arsenal, including Russian trainers.

He forms a separate economic group to challenge the EU based one and he seizes all Western assets in Russia while getting China to help as much as feasible with western assets in China.

Lastly, Russia and if possible, China, dump all their American Treasury assets onto the market at the beginning of the trading week.

Oh and he secretly sends his top nuclear scientists to Iran along with as much weapons grade plutonium or uranium as possible, maybe even a couple of working examples, to help them complete their bomb program. Then after Iran has bolstered it`s air defenses they`ll announce, with the appropriate underground tests, they`re now a nuclear power.

Why do guys like you think that such nonstarters like the Ukraine or Syria are just causes for reigniting a new cold war, especially when this country is so close to self imposed bankruptcy and economic destruction? We can`t even keep our budget balanced and we need to "relive the glory days" of the cold war by continuing to be "the policeman of the world"?

8 posted on 03/01/2014 7:56:39 AM PST by nomad
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To: nomad

Not to worry, Bambi’s on your side and he holds all the cards.


9 posted on 03/01/2014 8:14:43 AM PST by No One Special
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To: No One Special
No, I`m on the side of taxpayers! If it`s so dear then you foot the bill for “policeman of the world” status. But I suppose to you, American economic collapse is ok too?
10 posted on 03/01/2014 8:28:26 AM PST by nomad
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To: No One Special

Before we begin policing the world, may I suggest we try to reestablish the rule of law here?


11 posted on 03/01/2014 8:33:17 AM PST by nomad
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To: nomad

Obama will not do anything so in that sense my post is an exercise in futility. Despite your disinterest in a cold war I can assure you that that war is interested in you and me and all Americans because the war mongers recognize that we are the only thing that can stop their evil plans from coming to fruition. Those plans entail our subjugation.


12 posted on 03/01/2014 8:47:30 AM PST by No One Special
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To: No One Special
Has it occurred to you that our economic collapse is one of the quickest paths to "our subjugation"?

Try looking up the various scenarios which lead up to WRAL. Economic collapse is at the top of the list.

13 posted on 03/01/2014 8:52:16 AM PST by nomad
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To: No One Special
Besides, have you analyzed your statements? Your apparent belief that we should go to war over the Ukraine presumably places you into that “warmonger” category.
14 posted on 03/01/2014 9:07:27 AM PST by nomad
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