Saturday, 25 June 2016

US Think Tanks Lost in Own Fantasy World of Russian Aggression and Imminent Collapse - Pepe Escobar


So it's time for US Think Tankland – as in CIA front Stratfor, among others – to renew their spin offensive, mixing “analyses” of imminent Russian economic collapse with calls for more NATO pressure over Russia’s western borderlands.

A solid case can be made that Moscow does not need mountains of Western investment; credit can be created in Russia. Most of all, there is rather less productive investment money in the West than wild speculative funds; it’s largely a matter of fiat money and credit, and Moscow does not need to go to the West for that.

As long as Russia uses investment capital to increase the production of goods, this will offset the increase in money supply. So in the end inflation will be negligible. Quite a few Russians must be puzzled at the Central Bank’s Elvira Nabiullina, with her policy of raising interest rates to cut back the increase in investment; that could eventually lead to a strangled Russia. Not accidently Nabiullina happens to be extremely praised by US Think Tankland and the City of London.

As to what credits would Russia use to pay for needed imported technology the obvious answer is to draw from energy exports – especially now with the oil price back on the way up. And here intervenes the temptation to redirect the export of oil and natural gas away from the EU to China and Asia – and let the EU grapple with its eternally inconsistent “energy policy”, which consists mainly of blaming Gazprom

It’s a myth that a dearth of foreign investment today will delay large projects in Russia – including the energy front; China will step up infrastructure investment in Russia with many projects linked to the New Silk Roads and overall Eurasia integration, as even US Think Tankland admits.

Russia may also replace most Western imports other than technology by building their own plants, following the massively successful Chinese model that has enabled Beijing, based on purchasing power parity, to become a larger industrial force than the US or the EU. 

One would be hard-pressed to find US Think Tankland focusing on American economic collapse – as true unemployment in the US may be as high as 23%. Inflation is also much higher, as the Bureau of Labor statistics takes out of the commodity basket rapidly rising individual commodities or products and substitutes it for less expensive replacements. This biases inflation to about half its actual rise over time. Meanwhile the — dwindling — “American dream” middle class is being squeezed, and that largely explains the masses coming out to cheer Donald Trump.

So we have reached a geopolitical juncture where the US is politically being torn apart as the EU is flooded by a sort of neo-Visigoth invasion. And this may be just a prelude. EU decision makers are so lost in space that they cannot control the Fortress’s borders (and need a dodgy deal with Sultan Erdogan); but at the same time this does not prevent them from being led to (cold) war with Russia.
http://russia-insider.com/en/politics/us-think-tanks-dream-russian-collapse-aggression-despite-facts/ri15071

[Posted at the SpookyWeather blog, June 25th, 2016.]

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