What If, Part 3

This article is the third of the series (What If: Part 1, Part 2, Part 3) covering the Author’s understanding of the outlook of great powers relations in the next ten years period. The approach is based on certain scenarios, which in turn are based on confirmed or estimated trajectories in the real world.

In this article, the focus is on key international trends and processes paving the way for a new world order and, on the other hand, summarizing latest relevant development processes in the US position.

Wrap-up of key international processes for new world order

New security order in Europe

Last two months have seen Russia, the United States and NATO, to discuss Moscow’s demands for a new security order in Europe. The Russian plan envisages a greatly reduced role for NATO on and around its borders. The EU, some major European countries as well OSCE have come along with the process. Stakes are high and the tension is increasing in Ukraine, despite intensive talks and negotiations. The chances of the Americans agreeing to the Russian demands (NATO ceases its eastward ambitions, the US should withdraw their weapons and their troops from Russia’s borders) are virtually nil.

The crux of Russia’s complaints about its eroding security have little to do with Ukraine per se but are rooted in the Washington hawks’ obsession with Russia and their desire to cut Russia down to size. From the Washington perspective, Ukraine is going to turn into Biden’s dilemma. The recent major war campaign by the US and Western mainstream media (“imminent Russian invasion”), was thought to create a reason for Europe and America to impose ‘Sanctions from Hell’ that would ruin Putin’s supposed ambitions in Europe and beyond.

The “imminent invasion” frenzy perhaps was thought by the hawks of the Washington ‘war narrative’, to be sufficient to incite Putin into military action – triggering these “Mother of all Sanctions”, or a humiliating downsizing of the Russian forces adjacent to the Ukraine border.

They were wrong. Essentially, Russia doesn’t want or need Ukraine, Russia has no plan to occupy it. Symptomatically, even President Zelensky and his administration have claimed that invasion fears were overblown and that the nervousness was bad for Ukrainian business and the economy. Ukraine is reportedly on the brink of debt default and has turned to China, looking for help.

Sergei Lavrov has stated “If our attempts to come to terms on mutually acceptable principles of ensuring security in Europe fail to produce the desired result, we will take response measures. Asked directly what these measures might be, he (Putin) said: they could come in all shapes and sizes”. Russia had previously announced that absent a satisfactory western response, then Russia would lay aside the language of diplomacy – and resort to unspecified “military-technical” measures – incrementally ratchetting pain on NATO and the U.S. Many kinds of outcomes are possible now, the factual solution remains to be seen.

More info of this topic can be found here, here, here, here on this website.

Kazakhstan case

An escalating trend in great power relations can be seen in the recent coup attempt in Kazakhstan. There, a well-organized foreign group took advantage of some local unrest at a major increase in fuel prices to attempt to stage a coup d’état against the Kazakhstan government. The speed with which the Russian led intervention at the request of the Kazakhstan government strongly suggests that the attempted coup came as no surprise to the Russians and their colleagues in the group that responded. The American response to the Russian led movement on behalf of the Kazakhstan government also left little ground for doubting that the Americans were heavily involved in the coup attempt.

Secretary of state Antony Blinken demanded an explanation for the Russian led rescue mission. He was clearly unaware of the 1994 agreement between Kazakhstan, Russia and the others that was designed to meet precisely the sort of situation the Kazakhstan government was met with.

The Russians and the Chinese government clearly saw the unrest for what it was; a thinly disguised attempt to overthrow a Russian – Chinese friendly government and replace it with one whose commitment to the old regime’s path could not by any means be assured. Kazakhstan is in fact a crucial member of several important organizations that Russia and China have developed in recent years, including the Shanghai Cooperation Organization and the Eurasian Economic Union. It occupies a crucial space in the Eurasian heartland, and is the world’s eighth largest country in land area and thus has a significant physical presence as well. The failure of United States attempts to forcibly change the Eurasian geopolitical landscape, as most recently in Kazakhstan, points to a new reality, the forces of which are unstoppable.

More info of this topic can be found here on this website.

Chinese Belt and Road Initiative (BRI)

The Chinese BRI poses the most significant challenge to United States hegemony which for much of the post-World War II period has managed to dictate the nature and course of economic and social developments in large parts of the world. The BRI is changing all that and for the first time in recent history the United States has no idea how to appropriately respond. We have seen the gestures such as the attempt to invoke the “rules based international order” as a viable alternative to the system of international law that Russia and China, among many others, insist is the proper basis for the conduct of international affairs. The Americans see the Chinese as the greatest threat to their vision of the world and the constant info war against China is one of their main weapons to combat China’s inexorable rise. In recent years the Americans have progressively made life more difficult for Chinese exports to their country.

More info of this topic can be found here on this website.

China – Russia enlarging and intensifying cooperation, creating a new world order

This topic has been studied in many places on this website: here, here, here, here.

Obviously, the recent meeting of Xi – Putin in Beijing, February 4, and the Joint Statement thereafter, is the strongest expression of closing friendship and partnership of the two countries. This is much more important than many western experts appreciate. It marks the beginning of a period of rising tensions and maybe clashes between East and West, until a modified, new world order emerges. Making this clear to all is a necessary condition for a joint Russia-China shift to coordinated ‘military-technical measures’. It seems that shortly after Putin returns from his consultations with President Xi in China, we may begin to see what these military-technical measures might be.

De-dollarization scheme by Russia and China

Both the Russian and the Chinese president agreed to create an “independent structure for trade operations that could not be influenced by other countries”, a clear reference to the United States, which has not hesitated to use SWIFT system as a control means to achieve other geopolitical goals.

The importance of the Russia – China agreement to create an independent financial structure cannot be overstated. Russia and China are two nations that have suffered under United States hegemony of the world financial system and they do not have to be asked twice to abandon that system and join the new alternative. Bypassing the dollar’s role in trade and indeed the entire financial system is a major goal of both Chinese and Russian planners. Removing the dollar as the principal means of exchange is a vital stage in the Russian – Chinese version of a new global order.

China takes over the role of chairing the BRICS system of international trade and the year in charge is expected to see an acceleration of a series of related economic arrangements. These include the closer association between the Belt and Road Initiative and the EAEU whose geopolitical and geo-economic importance is expected to expand through 2022.

More info of this topic can be found here, here on this website.

China and Asian theatre

The other major change occurring in the region is the coming into force of the RCEP deal, a truly game changing arrangement that links China with 10 ASEAN nations, plus Japan, South Korea, Australia and New Zealand. The inclusion of Japan, South Korea and Australia may be seen in some ways as a game changer. All three countries have close ties to the United States, and it is certain that the United States did not approve of their becoming members of the RCEP.

The difference in opinion between China and United States is exemplified by the attitude to trade. The United States has progressively become less of a free trade nation, imposing more and more restrictions upon Chinese imports. China on the other hand is moving in the opposite direction. In recent years China has progressively opened its markets to foreign trade, and the RCEP is a personification of that trend.

China is the driving force of the Asia Pacific region. As the old saying goes, if you don’t play the game, you don’t make the rules. The United States has long lost the ability to dictate the rules, let alone define how others should play a game. It is a lesson the Americans have been slow to learn. In Asia, and indeed throughout much of the rest of the world, China is showing that it does not accept the United States version of the rules. The quicker the Americans learn that lesson, the safer the world is likely to be.

More info of this topic can be found here, here on this website.

Russia-Iran relations and the changing world order

Iranian President Ebrahim Raisi visited Russia for a two-day visit (Jan. 19-20, 2022). This was the In a changing world order, Iran and Russia are working towards strengthening bilateral ties and are seeking to sign a 20-year agreement along the lines of the 25-year Iran-China ‘strategic cooperation pact’ signed in March 2021. 

During his visit, Raisi met with Putin at the Kremlin and according to media reports, he is supposed to have handed over a draft of the 20-year cooperation agreement. Putin and Raisi also discussed a range of bilateral and international issues, with a focus on the Iran nuclear deal (JCPOA). While it is still tough to predict the ultimate outcome of the negotiations between Iran and other signatories to the JCPOA, at Vienna, Moscow has played a very important role in trying to revive the Iran nuclear deal.

This reiterates the point that there is scope for Moscow and Washington to find common ground on crucial issues, as has been suggested by many analysts and that the nature of Moscow-Washington relations is fundamentally different from that of Washington-Beijing ties. Iran’s focus on improving ties with Russia also indicates that it does not want to be solely dependent upon Beijing.

New winds of change in MENA region, Africa and Latin America

The actual crisis in Ukraine/Europe is not about Ukraine but the scale is much bigger. It will, in the longer run, define not only Europe’s future but as well that of the Middle East and ultimately the New World Order.

Interesting and even surprising new processes, events and trajectories can be found all over the world. What is striking now, is that Moscow and Beijing seem to be the international hubs of intensive diplomatic, political, military and economic communications and other activities.

Unipolar and post-unipolar era

The US unipolar era, American dominance, since the end of the Cold War 1990, has been a source of stability and conflict. In the first and half decade, it was mainly a source of stability but since 2007 (Putin’s prophetic speech in Munich) more and more conflicts have emerged and great power competition restarted. Since 2015 – 16 the unipolarity began the slow transformation process towards more polycentric world.

Maintaining its hegemony, the US has divided the world into marginalized adversaries and dependent allies. In the West Europe, NATO was seen as a peace maker on the continent but it has also been the main source of conflict as the bloc expanded towards Russian borders. While the US unipolar moment has come to an end and its security guarantees are losing their credibility, the stabile unipolar world order is turning in the prospect of conflict.

After the Cold War, the West initially signed up for several pan-European security agreements. The Charter of Paris for a New Europe in 1990, the Budapest Memorandum in 1994 and the Istanbul Document in 1999 all committed to the principle of “indivisible security,” which meant “They will not strengthen their security at the expense of the security of other States.”

All of these pan-European security agreements were subsequently violated by the US hegemonic pursuit with the West insisting that NATO should monopolize security. The thinking formula shifted from “indivisible security” to the “freedom to expand the bloc. “

The US also began to dismantle many pan-European security agreements such as the NATO-Russia Founding Act of 1997, the Anti-Ballistic Missile Treaty of 1972, the Intermediate-Range Nuclear Forces Treaty of 1987, and other agreements that could constrain the Americans. Even international law in accordance with the UN Charter was marginalized by seeking alternative legitimacy under the Orwellian concept of the “rules-based international order.”

Europe is now in a precarious situation as many pan-European security agreements have been dismantled, Russia has challenged the EU by hard security claims and there is no more such US hegemony to ensure stability as before. Even the EU is finally coming to terms with the consequences of US decline. In couple of last years, new statements like “We Europeans really have to take our fates in our own hands” or “Europe’s strategic autonomy”, have come up in European discussions.

The first reaction of the EU has been consistent with the hegemonic order – use threats and ultimatums to make Russia accept the dictates of NATO and the EU. However, in the absence of hegemony, the Europeans are only isolating themselves. Russia is deploying massive military force, increasingly advanced weaponry and rapidly reducing its economic, technological, and financial reliance on the West by enhancing its economic connectivity with the East (mainly China).

The EU could previously dismiss or ignore Moscow when Russia was economically and militarily weak. However, this time it is different. Russia feels facing an existential threat with NATO expansion into Ukraine and Russia has the economic and military means to balance Western unilateralism. Western capitals are grudgingly coming to terms with the end of hegemony and unilateralism. Moscow has now demanded an end to the era of NATO hegemony and a return to the principle of indivisible security. The Kremlin appears to be planning for an age where America matters less.

The US has felt it distasteful to admit defeat and leave Afghanistan as it would cause a “credibility crisis.” If Ukraine and Taiwan did not have full faith that the US would offer them protection, then their positions as Washington’s frontlines against Russia and China would not be tenable and they would have to seek peace with their adversaries. Without steadfast US support, Ukraine would have to abide by the Minsk Peace Agreement, and Taiwan would need to halt its push for secession from China.

The failed US pursuit of regime change in Syria has resulted in both the Arabs and Turkey moving gradually towards reconciliation and a workable peace with Damascus. American efforts to reach an agreement with Iran, and the failure to decide the outcome of the conflict in Yemen, has similarly incentivized Saudi Arabia to re-establish diplomatic ties with Tehran, and paved the way for negotiations on improving bilateral relations and ending the war in Yemen. 

Latest ominous features in the US

US indebtedness has been for four last years at very alarming level, federal debt exceeding $30 trillion in early 2022 and all other sectors in American society also at record high debt levels. Federal budget deficit exceeds now a trillion per fiscal year 2021 and is enlarging. Imbalance between the incomes and expenditures is staggering, especially the military expenditures seem to be overwhelming.

US trade deficit in both goods and services rose to a record $859 billion in 2021 as imports surged, the US Commerce Department has reported. US imports rose by 20.5 percent to $3.39 trillion in 2021 while exports climbed by 18.5 percent to $2.53 trillion, according to the department.

The US economy grew 5.7 percent in 2021, mainly due to the massive fiscal and monetary support packages by Biden administration (100% debt financing), following a pandemic-induced contraction of 3.4 percent in 2020, according to the department. Rising inflation is also playing a growing role in the US economy. The US consumer price index rose 7.5 percent in January from a year earlier, the largest 12-month increase for 40 years. In reality, according to several economic experts, inflation rate is at least twice so much, exceeding 15 %.

American odd political culture, combined with today’s “woke culture”, has created a toxic war hysteria regarding Ukraine crisis, day after day American mainstream media has repeated “Russian imminent invasion”, which has never materialized so far and “highly likely” will not take place in next months. Conversely, American great disappointments like the withdrawal from Afghanistan, which turned into total fiasco both politically and militarily, have made increasing division in American society.

Ray Dalio, Chairman of Bridgewater Associates, argues in his latest book that the US appears to be on a classic path toward some form of civil war. Mr. Dalio says:

What is obvious from looking at many cycles of rises and declines of different historical cases is that the combination of financial problems (large deficits, high taxes, a lot of money printing, and high inflation) and large wealth and values gaps, leads to some sort of fighting for control, which is a “civil war,” though these fights can be more or less violent.

Notably, when that happens at the same time as there are foreign powers that are becoming strong enough to challenge the leading world power that is encountering this civil war dynamic, it is an especially risky period. That is the period I believe we are now in. 

Dalio’s description of the present US situation coincides with such paradigm that in modern times, as in ancient Rome, several nations have suffered a “systems collapse.” The term describes the sudden inability of once prosperous nation to continue with what had ensured the good life. Abruptly, the population face diverse problems, both practical and governmental. Examples are plenty like the latest ones Venezuela from 2010 on or Greece 2009 – 2016. Today’s UK resembles increasingly miserably regressive state.

Joe Biden’s presidency may already be leading the United States into a similar meltdown. Hard Left “woke” ideology has all but obliterated a number of “ideas” like scientific research, societal harmony, border of state etc.: millions of impoverished foreigners are entering the US illegally, the health bureaucracies have lost credibility as official authorities, race relations are regressing into a premodern tribal society, crime soars, inflation roars, competency is put aside and the society is governed more by ideology and tribe. Millions stay home, content to be paid by the state not to work. Supply shortages and empty shelves are the new norm.

American path to a systems collapse is not due to an earthquake, climate change, a nuclear war or even the COVID-19 pandemic. Instead, most of American maladies are self-inflicted. They are the direct result of woke ideologies that are both anti-intelligent and antithetical to traditional American pragmatism. As the US is heading into the 2022 midterm elections, who will stop American descent into collective poverty, division and self-inflicted madness?

All in all

Taking into account both American domestic internal factors and external, international factors, the future, be it near or mid-term, does not seem to be promising for the US, on the contrary all kind of risks are nearly skyrocketing and the situation is no more under control by the US.