Global equities attempted to find their footing Wednesday after the S&P entered a correction for the second time in two months.
Asian shares generally rose, while European traders warily eyed any headlines mentioning Ukraine. Market participants took some solace in the notion that the sanctions against Russia unveiled on Tuesday were “limited.”
Limited or not, Beijing doesn’t like them. Hua Chunying — China’s Maria Zakharova — called the measures “irresponsible and immoral” while blaming the US for the crisis. America “added oil to a burning house then pointed fingers at others trying to put out the fire,” she said, in a characteristically colorful set of remarks during a regular press briefing in Beijing. It was the first time in almost six months that Hua headed a daily Foreign Ministry briefing. “China has been calling on all parties to respect each other’s concerns,” she said. The US “has been sending arms.”
China isn’t exactly an impartial observer. Beijing’s interest in the conflict goes well beyond its role as a superpower. Xi has long been keen on expanding Beijing’s sphere of regional influence, and so far, the reception hasn’t been particularly warm in China’s backyard. Hong Kong was the easy part. Taiwan is a medium-term aspiration. Notwithstanding Xi’s protestations, the long run goal is some kind of hegemony. Hegemony “with Chinese characteristics,” maybe.
In any case, Ukraine was poised to declare a national state of emergency and the EU looked to ban buying and selling of securities and money-market instruments issued by the Russian government and the central bank. Liz Truss told Sky it’s still “highly likely” that Putin will move ahead with a full-scale invasion, including an assault on Kyiv.
For his part, Putin continued to push some version of the familiar (and patently ridiculous) idea that NATO is always plotting an offensive against Russia. “The interests of Russia and the security of our citizens are unconditional for us,” he said, after claiming the Kremlin is “always open to honest dialogue.” “So, we will continue to develop and improve the army and navy, to increase their efficiency,” he added.
China parroted Russia’s implicit contention that NATO has an offense-first mindset when it comes to Moscow. Hua on Tuesday asked if the West has “ever thought about the consequences of cornering a major power.” In addition to being a veiled threat (Beijing often alludes to America’s efforts to ring-fence China), Hua’s remark was absurd.
This is why I continually implore news-consuming citizens in Western democracies to exercise common sense when evaluating geopolitics. It’s one thing to harbor a healthy degree of skepticism towards whatever the “official” narrative is out of Washington, London and Brussels. It’s entirely another to accept wholly implausible assertions by the propaganda departments of autocratic regimes as somehow more credible than the Western spin machine.
The notion that NATO would ever launch preemptive strikes against Russia, let alone mount an “offensive,” is positively ludicrous. Why would the West do that? With (sincere) apologies to the Russian people (whose fault this most assuredly isn’t), nobody wants Russia. Especially given the unfathomable cost (and likely impossibility) of taking it.
Ukraine on Wednesday reiterated that it has no plans for any kind of offensive action, but Boris Johnson said the UK would provide additional military assistance to the country because… well, because it’s under attack.
In a short blog post, Bloomberg’s Alan Crawford said “there’s a sense among some Germans that the West wouldn’t be at this impasse with Russia if Angela Merkel was still in charge.”
Some readers will invariably adopt a derisive cadence while assessing that, but I’d say three things. First, Crawford is based in Berlin, so his take on the mood among Germans is, at the least, better informed than someone residing outside the country. Second he knows a thing or two about Merkel. Third (and I’ll put this in the interrogative), regardless of whether you believe Merkel’s approach would result in a counterproductive exercise in can-kicking appeasement, who would you rather have negotiating with Putin: Joe Biden, Boris Johnson and Emmanuel Macron, or the most experienced living statesperson on the planet?
In response to the question: it only matters if Putin is interested in negotiating.
I mean, Putin is going to be Putin regardless. It’s not about whether he would still think he can make incremental headway towards some fanciful restoration of a Russia that exists only in the history books. It’s a matter of having at least a modicum of an effective “check” on the other side of the table. Biden, as experienced as he is, isn’t taken especially seriously, through no real fault of his own. It just kinda turned out that way for him. Boris is Boris — I mean, come on. And Macron has never really “grown into” the shoes he set out for himself — it just feels like there’s unrealized potential there, and he hasn’t handled domestic crises particularly well. I just don’t think Putin takes those three particularly seriously. Merkel is an entirely different story. Her history with Putin is as long as her history with everything else. Experience counts. A lot. Especially when you’re negotiating face-to-face with a KGB operative. In short: She’s not a joke. And Putin always knew that.
I don’t disagree with any of your points. Given the positions Russia has taken any of the 3 are an adequate ‘check’. It doesn’t take a special talent to stand firm against impossible asks.
That being said, I give ‘the 3’ credit for where things stand after yesterday’s moves. If there’s no further escalation, which I admit is doubtful, everyone can go home a winner.
I read this morning that Ukraine is drafting reservists ages 18-60 on a presidential order. I don’t see Putin backing down regardless of sanctions or military presence. Xi probably views this as an opportunity, with Russia stealing western attention, Taiwan just may become an easier target. Depending on how all of that goes, further expansion may become desirable. I wasn’t around for the last global conflict, but this certainly feels like it could become one.
Putin is a later day version of Stalin. (Take over eastern Europe. Start a war in Korea. If he had lived longer, who knows where he would have pushed next.)
Global GDP was about $95T in 2021. A quick review of GDP by country and my personal assignment of each country into one of two categories- yields the following:
Autocratic and/or more corrupt than the USA ($40T)
Democratic and/or no more corrupt than the USA ($55T)
Reshuffling the deck within each of those 2 categories is not as big of a deal as when a country/nation state moves from “Democratic….” to “Autocratic….”.
Without a Nelson Mandela type person to change the direction of an autocratic/corrupt country or WWIII, we seemed doomed to category 1 (from above) increasing in size during my lifetime.
Compare China’s official statements (self-serving, yes, but not kowtowing to either side) with the following two responses in America: Donald Trump quote: “This is genius. … That’s the strongest peace force I’ve ever seen” Fox News headline, quote: “TUCKER CARLSON: Americans have been trained to hate Putin, and will suffer because of it”
Politics aside, it simply makes me ill. Is this really the level to which American conservativism has fallen? At least China has the gumption to follow their own lead instead of someone else’s.
I would certainly be interested in German perception and reaction to this. If Putin can buy off Germany, he can forestall much of the potential US/European response. In significant part, Putin’s current leverage over Europe exists because the economic powerhouse of the EU made such poor decisions on energy policy over the past decade. Those decisions were made on Merkel’s watch. As such, I wonder how well she’d deal with this. Could she admit that phasing out nuclear, pushing renewable without storage, and overlooking LNG terminals, all need to be reversed/changed?
I’m reminded of an excellent article in The Atlantic about Putin’s formative experience: as KGB chief of station in East Germany when the Berlin Wall fell, desperately destroying documents while wondering whether the mob was going to lynch them all.
Angela Merkel’s formative experience… was growing up in East Germany.