Guest Post by David Stockman from ContraCorner:
The messages are coming in loud and clear today—from the crashing pound, to repudiation of establishment governments in Italy, Sweden and more to come, to Hungarian Prime Minister Orban’s call to end the Sanctions War and do so pronto.
So let’s be clear: Washington’s dunderheaded intervention in the intramural spat between Russia and Ukraine and the accompanying global Sanctions War is the surely the stupidest, most destructive project to arise from the banks of the Potomac in modern times. And the architects of this perfidious folly—Biden, Blinkin, Sullivan, Nuland et. al.—cannot be condemned harshly enough.
After all, this madness is being pursued in the name of abstract policy norms—the rule of law and sanctity of borders—that make Washington a laughing stock. More than any other nation on planet earth (and by a long-shot), it has serially and blatantly violated these standards scores of times in recent decades.
Among other actions, Washington’s interventions in Serbia, Iraq, Afghanistan, Libya, Yemen, Syria, Somalia etc were not only pointless; they were also a self-evident violation of the very rule of law and sanctity of borders upon which Washington now beats its breasts ever more stridently.
Moreover, by wallowing in this unhinged hypocrisy Washington has abandoned every semblance of commonsense as to why this conflict happened in the first place and why it is wholly irrelevant to the national security of the American homeland, or, for that matter, Europe, as well.
The fundamental fact is, aside from the historically short interval of iron-fisted communist rule during the Soviet era, Ukraine had never been a nation-state within its post-1991 happenstance borders. In fact, for upwards of 275 years before 1918 much of its territories were borderlands, vassals and outright provinces of Czarist Russia; and before that constituents of the Polish-Lithuanian Empire and others.
So we are not dealing with the invasion of a long-established, ethnically and linguistically coherent state by its aggressive neighbor, but with the left-over potpourri of separate tongues, territories. economies and histories that were smashed together by brutal communist rulers between 1918 and 1991.
Accordingly, the fast-approaching dark, cold winter of stagflationary collapse in Europe is not being done in heroic defense of the grand principles proffered by Washington and NATO. To the contrary, it amounts to the pointless and grubby business of preserving a vile status quo ante that was confected on the lands north of the Black Sea, not by the ordinary course of historical evolution and nation-state accretion, but by the bloody-hands of Lenin, Stalin and Khrushchev.
In any event, the staggering economic costs for the everyday peoples of Europe in pursuit of such a threadbare and illegitimate purpose is starting to register among the long-suffering victims of Brussels’ elitist rulers. Hence the thunderbolts from the Italian elections this weekend and Viktor Orbán’s parallel appeal to the European Union to lift sanctions and thereby potentially reduce energy prices by half in one swell swoop.
Nor is Orbán the only one calling for an end to sanctions, with Greek Prime Minister Kyriakos Mitsotaki calling for a repeal of Russian sanctions as well. Other political leaders, such as Matteo Salvini, who leads the conservative League party and will be a major force in Italy’s new government, says that Europe needs a “rethink” on Russian sanctions due to the harmful economic effects.
Likewise, the conservative Alternative for Germany (AfD) party has also been pushing for an end to sanctions and an re-opening of the Nord Stream 1 & 2 gas pipelines due to soaring energy costs in Germany. AfD member of the Bundestag, Mariana Harder-Kühnel, for instance, recently echoed Orbán’s call.
“The EU bureaucracy has turned the screw on the sanctions, and now we are paying the bill,” she said.
In this context, the ructions since Friday in the FX market for the pound sterling speak more powerfully than anything else.
The British pound briefly plunged to its lowest level ever early this AM, touching $1.0349 during Asian trading hours, breaking through its previous record low of 1985. Moreover, today’s cliff-dive followed a tumble of 3% on Friday, after the new Truss government announced sweeping tax cuts and a massive energy bailout for businesses and individuals.
Likewise, the price of U.K. government debt has fallen in tandem with the pound, with yields rising sharply again today. The 10-year government bond was yielding 4.11%, up 28 basis points from Friday and a staggering 342% from the 0.93% yield of just one year ago.
For want of doubt, here is the path of pound sterling over the last twelve months. That’s a massive thumbs down by the FX markets if there ever was one.
But the relevant point here is not all the Keynesian palaver about the “mistake” of lowering the 45% top income tax rate and removing other disincentives to work and investment that take UK marginal rates as high as 60%. These reductions in the crushing tax rates that Conservative and Labor government alike have erected atop the UK’s lavish Welfare State are long-overdue and will, in fact, stimulate compensatory economic activity.
What’s actually going to destroy the remnants of the UK’s fiscal sustainability is Truss’ utterly foolish plan to freeze all energy prices for all citizens and businesses at a cost of upwards of $200 billion per year or 5% of GDP. But that’s neocon insanity run amok.
If London wants to relieve its consumers of onerous energy prices and utility bills it only need follow Orban’s advice and terminate its Sanctions War against Russian energy, food and other commodity exports. And it wouldn’t cost the Exchequer a dime.
That is to say, the pound’s crash ought to be a general wake-up call to Europe and Washington, too. By declaring war on the productive and peaceful commerce with Russia that previously prevailed, Europe’s leaders—-especially the new government of United Kingdom—have sacrificed their own prosperity and the living standards of their citizens in behalf of a prodigiously corrupt, anti-democratic regime in Kiev that is dedicated to preserving intact nothing more noble than the dead hand of the Soviet Presidium.
Or as our friend James Howard Kunstler rightly summarized:
Let us agree that the place called Ukraine was never any of America’s business. For centuries we ignored it, through all the colorful cavalry charges to-and-fro of Turks and Tatars, the reign of the dashing Zaporozhian Cossacks, the cruel abuses of Stalin, then Hitler, and the dull, gray Khrushchev-to-Yeltsin years. But then, having destroyed Iraq, Afghanistan, Libya, Somalia and sundry other places all on a great hegemonic lark, the professional warmongers of our land and their catamites in Washington made Ukraine their next special project. They engineered the 2014 coup in Kiev that ousted the elected president, Mr. Yanyukovich, to set up a giant grifting parlor and international money-laundromat. The other strategic aim was to prepare Ukraine for NATO membership, which would have made it, in effect, a forward missile base right up against Russia’s border. Because, well, Russia, Russia, Russia!
So we return to the question at hand: Every Ukrainian presidential election since 1991 has revealed a nation radically split between pro-Russian populations in the east and south and anti-Russian nationalists in the center and west. When the mailed fist of communist rule was removed, in fact, Ukraine became a territory yearning to be partitioned into more amenable jurisdictions of governance.
For instance, here is the results of the 2010 election that put a pro-Russian politician in the president’s office and at length gave rise to Washington’s putsch during the Maiden uprising that soon drove the country into civil war.
The above map barely does justice to the actual figures. In many of the yellow Tymoshenko-supporting areas the vote was 80% or higher in favor of the latter’s nationalist candidacy, while in much of the blue area the pro-Russian Yanukovych won be similar massive pluralities.
Yet this wasn’t a one-time fluke of short-term electoral politics: It was actually the recrudescence of the manner in which the fake nation of Ukraine was put together during the last three centuries.
Prior to the end of WWI, there was no Ukrainian state. Like the artificial and unsustainable polities of Czechoslovakia and Yugoslavia, which were confected by self-serving politicians at Versailles (especially the domestic vote seeking Woodrow Wilson), Ukraine was a product of geopolitical engineering—in this case by the new rulers of the Soviet Union.
Indeed, the historical provenance of “Ukraine” can be described in a nutshell. What was to become Ukraine joined Russia in 1654 when Bohdan Khmelnitsky, a Hetman of the Zaporozhian Host, petitioned Russian czar Alexey to accept the Zaporozhian Host into Russia. That is to say, Imperial Russia spawned the latter day polity of Ukraine by annexing into its service the fearsome Cossack Warriors who inhabited its central region.
The army and a small territory then under Hetman control was called “u kraine,” which means in Russian “at the edge”, a term that had originated in the twelfth century to describe lands on the border of Russia.
During the next 250 years the expansionist Czars annexed more and more of the adjacent territory, designating the eastern and southern regions as “Novorussiya” (New Russia), which territories included Catherine the Great’s purchase of Crimea from the Ottomans in 1783.
That is to say, at the time of America’s own independence the heart of today’s Ukraine was ruled by the long arm of Czarist autocracy.
After the Bolshevik revolution, of course, the map changed radically. In 1919 Lenin created the socialist state of Ukraine on part of the territory of the former Russian Empire. Ukraine officially became the Ukrainian People’s Republic with the capital of Kharkov in 1922 (moved to Kiev in 1934).
Accordingly, the new communist state swallowed up Novorussiya per the eastern and southern portions of the green area in the map below, including Donetsk, and Lugansk regions, as well as the Kherson and Zaporizhzhia regions bordering the Sea of Azov and the Black Sea that are the sites of today’s Russia-sponsored succession referendums.
Then in 1939, as a result of the infamous Nazi-Soviet Pact, Stalin annexed the eastern territories of Poland, as designated by the yellow areas of the map. Thus, the historic territory of Galicia and the Polish city of Lvov were incorporated into Ukraine by the joint decree of Stalin and Hitler.
In June of 1940, Stalin next annexed Northern Bukovina (brown area) from Romania. And then at the Yalta conference in 1945, upon Stalin’s insistence to Churchill and Roosevelt, the Hungarian Carpathian Ruthenia was incorporated into the Soviet Union and added to Ukraine.
Taken together, these Stalinist seizures are now known as Western Ukraine, the people’s of which understandably do not cotton to things Russian. At the same time, the 85% Russian-speaking population inhabiting the purple area (Crimea) was gifted to Ukraine by Khrushchev in 1954 for the very reason of extending his own accession to the communist dictatorship.
Nevertheless, after the disintegration of the Soviet Union, Ukraine inherited these communist-confected borders within which there were upwards of 40 millions Russians, Poles, Hungarians, Romanians, Tartars and countless lesser nationalities—all trapped in a newly declared country in which they didn’t especially wish to reside.
Indeed, the reason that the hapless state of “Ukraine” needs relief in partition, not a war to preserve the handiwork if Czars and Commissars, was well summarized by Alexander G. Markovsky in the American Thinker:
Today’s Ukrainian civil war is thus greatly exacerbated by the fact that unlike pluralistic societies such as the USA, Canada, Switzerland, and Russia, which are tolerant of different cultures, religions, and languages, Ukraine is not. Unsurprisingly, devotion to pluralism proved not to be her forte. Even though the Kiev regime had no historical roots in the real estate it inhabited, it imposed Ukrainian rules and the Ukrainian language on non-Ukrainian people after declaring independence.
As a result, pro-Russian sentiments – ranging from the recognition of the official status of the Russian language to outright secession – have always been prevalent in Crimea and Eastern Ukraine. Western Ukraine has always gravitated toward its Polish, Romanian, and Hungarian roots. Emphatically anti-Russian, Poland may not miss this strategic opportunity to re-acquire its land and avenge the humiliation inflicted by the Yalta Conference.
The West’s insistence on maintaining the status quo of the Ukrainian borders established by Lenin, Stalin and Hitler exposes the disconnect between strategic doctrine and moral principles.
Indeed, Poles make no secret of their ambitions. Polish President Andrzej Duda, recently declared, “For decades, and maybe, God forbid, for centuries, there will be no more borders between our countries – Poland and Ukraine. There will be no such border!”
Romania is not far behind, especially in light of many inhabitants of former Northern Bukovina already carrying Romanian passports.
The territory of Ukraine is a mosaic of other people’s lands. If we want to stop this insane war and ensure peace in Europe, instead of calling Russia’s sponsored referendum in Eastern Ukraine a sham, we should conduct an honest referendum in all the disputed territories under the auspices of the UN and let the people decide what government they want.
Needless to say, partition of the fake state of Ukraine is not remotely on Washington’s mind. After all, it would remove the latest neocon reason for spreading the blessings of Forever Wars to the fairest parts of the planet.
Guest Post by David Stockman from ContraCorner.
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