News from the Front of the Economic War
TRANSCEND MEMBERS, 3 Apr 2023
19 Mar 2023 – In last month’s blog, I discussed news about the Ukraine War, how it is being sustained not only on one side by Russia, but also, on the other side, by the U.S. empire, Europe (NATO) and their allies such as Canada, Japan and Australia, while the rest of the world refuses to take sides.
The US support and escalation of the Ukraine War is central to the politics of the Biden administration and its NEOCON strategists who are trying to maintain US hegemony over the entire world. Ukraine is a pawn in the strategy of attacking Russia that is considered the principal enemy of that hegemony along with China. This strategy is not new but was central to the Obama administration and its Secretary of State Hillary Clinton, as well as the Bush and Clinton administrations that preceded Biden.
This month, I wish to discuss the news from the deeper war, the Economic War of the North American empire against the rest of the world.
The Economic War goes back to 1962 when the US imposed economic sanctions against Cuba because Fidel sided with the US enemy that was Russia.
Since then economic sanctions have been imposed on many other countries. As of a recent listing, at least 40 countries face these sanctions.
We quote the Venezuelan ambassador to the United Nations, Samuel Moncada, speaking to the XVIII Summit of the Non-Aligned Movement held in Baku, Azerbaijan, Oct. 26, 2019. Addressing the 120 countries represented, he denounced the imposition of arbitrary measures, called “sanctions” by the U.S., as “economic terrorism, which affects a third of humanity with more than 8,000 measures. This terrorism,” he said, “constitutes a “threat to the entire system of international relations and is the greatest violation of human rights in the world.”
Cuba and Venezuela, along with Iran, Zimbabwe, Nicaragua and Syria, are among the countries where the people have been greatly hurt by sanctions.
And now the North Americans and their NATO allies continue to increase economic sanctions against Russia. The Russian people suffer doubly: from the sanctions; and from the diversion of government resources to the Ukraine War.
But, as in any war, there is another side which is bolstering its defense.
The central actor on the other side is the BRICS Coalition of Brazil, Russia, India, China and South Africa. Argentina and Iran have recently requested to join the Coalition.
What is the lates news from the front of this Economic War?
The recent decision of Iran and Saudi Arabia to re-establish diplomatic relations was brokered by China, and it resonates with news that Saudi Arabia, like Iran, is interested to join the BRICS Coalition. Also interested, it seems, are Turkey and Egypt.
The recent announcement by Brazil and Argentina to establish a monetary system independent of the US dollar resonates with their BRICS involvement. Also, over the past two decades, China has become the biggest trading partner, overcoming the United States, in nine Latin American countries (Cuba, Paraguay, Argentina, Chile, Brazil, Uruguay, Peru, Bolivia and Venezuela).
As for the sanctions imposed against Russia, they are forcing the Russians to increase their trade with the BRICS countries, especially China and India, and with the potential BRICS countries of Iran and Saudi Arabia.
One of the results of the Russian sanctions, as we noted in last month’s CPNN bulletin, is that the IMF growth projections place the BRICS countries ahead with India at 6.8%, China at 4.5% and Russia, despite the sanctions, at 2.1%, On the other hand, the projections for the US empire are less: 1.6% for the 27 countries in Europe, 1.0% for the United States and 0.9% for Japan.
Looking further into the future, the Chinese now lead the world’s investment in most of the scientific and technological research areas necessary for development. This includes drones, machine learning, electric batteries, nuclear energy, photovoltaics, quantum sensors and critical minerals extraction. China’s dominance in some fields is so entrenched that all of the world’s top 10 leading research institutions for certain technologies are located in the country, according to a study by the Australian Strategic Policy Institute.
The recent news of the SVB bank failure in the United States and its repercussions in US trading partners could contribute to an economic recession in these countries, which would increase further the gap between them and the BRICS countries.
Also related to these news is that the United States is planning the greatest military budget in history. It would take more than half of the discretionary spending of the US government, putting further pressure on the lack of services for education, and healthcare in the United States which has contributed to political discontent, as expressed in the support for Donald Trump and the January 6 attack on the US capitol.
As we described in the blog of February this year, the continued growth of the gap between rich and poor in the North American empire has led some analysts to say that the political discontent may be followed by “a chaos far greater” than the January 6 attack. For the moment that discontent has not led to civil war but has been channeled instead into political power, since the Republican Party managed to take control of the lower house of the Congress in last fall’s election and hopes to be attain full power in the 2024 election. But the underlying discontent shows no sign of diminishing.
A key indicator of the Economic War is the place of the US dollar in the global economy. In this regard, this January at the Davos meetings of world capitalists, Saudi Arabia announced that it is open to discussing oil trade settlements in currencies other than the U.S. dollar.
According to analysts on some sources, such as the website zero hedge, the Saudi announcement is “the beginning of the end of the dollar, (since) the dollar’s world reserve status is largely dependent on its petro-status . . . The consequences of the loss of reserve status will be devastating to the US economy. . . This dynamic is already in play, as foreign holders of US debt and dollars have been dumping them at record pace since 2017.. The effects of the decline of the dollar may not be immediately felt, or become obvious for another year or two. What will happen is consistent inflation on top of the high prices we are already dealing with.”
This blog last June predicted the collapse of the US dollar. For the time being, despite the Saudi announcement. the US dollar is holding up. But how long can this last? In any case, as the blog quoted Bob Dylan, “the times they are a-changin’”
Dr. David Adams is a member of the TRANSCEND Network for Peace Development Environment and coordinator of the Culture of Peace News Network. He retired in 2001 from UNESCO where he was the Director of the Unit for the UN International Year for the Culture of Peace. Previously, at Yale and Wesleyan Universities, he was a specialist on the brain mechanisms of aggressive behavior, the history of the culture of war, and the psychology of peace activists, and he helped to develop and publicize the Seville Statement on Violence. Send him an email.
Tags: China, European Union, Hegemony, Imperialism, Military Industrial Media Complex, NATO, Non-Aligned Movement NAM, Pentagon, Russia, UK, USA, Ukraine, War Economy
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