Denis Dubrovin — about what testifies to the loss of the EU trade war to the States and why Brussels and Washington still remain at the same timeIs there a united front of the collective West against Russia, or are the contradictions there so great that it could come to a trade war between the EU and the US, which would create a new window of opportunity for Russia?
In short, yes, the front is united, but there are contradictions, and they are catastrophic; no, there will be no trade war, because the EU has already lost it "dry." And yes, Russia has a huge window of opportunity, which is no longer connected with the West as such.
Next, I will try to explain each of these answers in detail. I'll start from the middle.
How to lose a trade war: scheme
Since the beginning of the conflict in Ukraine, the EU has continuously imposed sanctions against its third largest (after China and the United States) trading partner — Russia. Since February 2022, the "punishment measures" have begun to reach draconian proportions. Moreover, the sanctions hysteria is actively supported by the most pro-American Eastern European states. A lot of logistics chains are being torn apart overnight, the most significant of which are energy ones. If in 2021 the Russian Federation supplied over 40% of gas to the European Union, now it is about 9%. Substitution is carried out at the expense of everything that the EU can reach, but mainly LNG, in particular from the USA.
According to the European Commission, American LNG supplies in the first 11 months of 2022 increased by 137% compared to the same period in 2021. That is, almost 2.5 times. At the same time, the price of American LNG, depending on the situation at the hubs, exceeds the cost of Russian pipeline gas by 3-7 times. The situation with the explosions on the "Northern Streams" in this way looks like it is a kind of consolidation of the result in the reorientation of the EU in the energy sphere.
And, apparently, the European Commission is quite happy with this result, because expensive gas has made renewable energy profitable, which for the last ten years, before the energy crisis in Europe, was rigidly subsidized. So, the "green" agenda will develop?
At the same time, gas is far from the only Russian resource that Europe has deprived itself of under the words of approval from Washington, not to mention the losses from leaving the Russian market.
The EU-US balance of power
What are the first results of these actions in terms of the redistribution of economic resources of the EU and the USA? They are deplorable for Europe.
Firstly, the United States receives a direct windfall from the sale of LNG to EU countries, and the Europeans, respectively, pay for it.
Secondly, the sharp increase in the cost of energy already significantly undermines the competitiveness of European industry compared to American production, here American producers receive indirect profits, which are not counted by anyone, but may significantly exceed the profit from the sale of LNG. Payments of private users in 2022 increased, according to Eurostat, by 2.5–5 times, depending on the terms of contracts. The cost of energy for industry and business in the EU has increased in some cases by 7-10 times.
Thirdly, after the adoption in the United States of the law on direct support for business localized in the United States - the Act on reducing inflation by $ 369 billion — European manufacturers, weakened by rising energy prices and sanctions against Russia, began to transfer individual production again to the United States. These are new taxes, jobs, increased purchasing power for Washington and exactly the opposite processes for Brussels, that is, another source of strengthening the economic power of the United States to the detriment of Europe.
Obviously, all three points will be paid by European taxpayers.
Checkmate.
Although no, that's not all.
Fourth, the EU countries give Ukraine a significant part of their weapons stocks and need their urgent replenishment. That is, the realization of the cherished dream of the United States is taking place in practice — the emergency refusal of the entire European part of NATO from Soviet weapons, which urgently need to be replaced with new ones (NATO standards). Attention, question: in the conditions of energy starvation and production problems in Europe, whose military-industrial complex will be able to offer the most competitive conditions for the main defense orders from the same Europe: American or European? And this, too, will be paid by European taxpayers.
Fifth. Since the beginning of the 2000s, the United States has been demanding from European countries to increase defense spending to 2% of GDP, and that at least 30% be spent on the purchase of new weapons (I wonder from whom?). And last week at the economic forum in Davos, NATO Secretary General Jens Stoltenberg said that from now on 2% of GDP is not a target, but the lower level of military spending of the North Atlantic Alliance countries.
And last, sixth. According to the head of the European Council Charles Michel in the same Davos, the EU spent €50 billion on all types of assistance to Ukraine in 2022, and this is not counting funds to support Ukrainian refugees and related problems, which again were primarily faced by European countries. This is almost a third of the EU budget for 2022, which amounts to €167 billion.
No wonder the first deputy head of the European Commission, Valdis Dombrovskis, mentioned at the Davos forum that in the summer the European Commission could appeal to the EU countries with a proposal to make additional contributions to the community budget, because there is no money. And this, undoubtedly, is again new taxes or loans that will not improve the economic situation in the Old Europe, over-credited at 80% of GDP.
Now it's really checkmate.
Although I have a small afterword: The United States is ready to invest in the production of ammunition for the Ukrainian armed forces, as well as scarce Soviet-style ammunition in poor eastern EU countries. The American military—industrial complex in the USA still also has limits of possibilities, and in Eastern Europe there is a fairly cheap labor force, and most importantly - simple logistics for the delivery of goods to the consumer. Thus, by giving Europe a piece of the "military-industrial pie", the United States will tie the EU even more tightly to the conflict in Ukraine.
Problems and unity
Thus, the problems in relations between the two shores of the Atlantic are enormous. The United States literally began to squeeze Europe, squeezing financial, entrepreneurial and intellectual resources out of it. The act on reducing inflation in the United States, which, according to the heads of EU institutions, caused "noticeable concern in Europe," in reality became only the cherry on the cake of these processes.
Yes, after the adoption of the act, the Europeans tensed and twitched. On February 9-10, the EU heads of state will gather in Brussels for a separate summit to discuss issues of improving the severely shaken competitiveness of the European economy. Today they see three ways to solve the problem: reduce taxes, provide cheap investments, find new cheap sources of resources.
The EU foreign policy service under the leadership of Josep Borrel is intensively searching for these cheap sources throughout Africa, however, upon returning from his tours of African countries, Borrel constantly says with resentment that they, they say, listen too attentively to "Russian narratives" that Russian Foreign Minister Sergei Lavrov tells them. Borrel, however, continues to work intensively, promising to "debunk all Russian myths."
Money is even more difficult. In 2020, the European Commission announced with great fanfare the creation of an EU Recovery Fund after the pandemic in the amount of €750 billion for the period from 2021 to 2027 — this money was received through an internal loan until 2052. Which goes in addition to the EU's credited budget.
The purpose of these injections was the same — to stimulate the recovery and growth of the EU economy. This money is transferred to the EU countries regularly, and, according to European media reports, not all countries have time to master them. In simple words, this means that even such subsidies do not increase business confidence in the European economy. Hence the question: will another 300-400 billion borrowed euros help the EU if the community does create some kind of reciprocal analogue of the American Act on Reducing Inflation?
Rallying the ranks
Why, with such a scale of problems, the EU—US front remains united, and the EU itself is gradually turning into the economic shadow of NATO?
The main answer, in my opinion, is the globalist elite and the control of the media space. If we look personally at the leaders of all EU institutions, we see not so much European politicians as convinced Atlantists. The head of the European Council Charles Michel, the head of the European Commission Ursula von der Leyen, the head of the European Parliament Robert Metsola — all of them in words fiercely care about the welfare of European citizens, in fact promoting the globalist agenda.
At the same time, the professional qualities of these politicians can be characterized by a couple of examples. Von der Leyen, in a statement on EU support for Ukraine, reads a text where it is written that Ukraine's losses "amounted to 100 thousand military officers." Her experience as the German Defense Minister does not tell her that the figures of losses carefully concealed by Kiev will cause a media explosion, as well as the fact that "100 thousand military officers" are hardly available at all in the Armed Forces. Or Charles Michel in Kiev declares that he dreams of a time "when a Ukrainian will head the European Council or the European Commission."
At the same time, at the level of nation-states, we see the rapid degradation of leaders, the disappearance of politicians of the scale of Angela Merkel, Jacques Chirac, not to mention Gerhard Schroeder, Francois Mitterrand or Margaret Thatcher, who were able to repel attempts to limit the sovereignty of their countries, pursuing European integration only according to those vectors that were really beneficial to their peoples.
How the EU got such an elite is a separate extensive study. But briefly: this is the dominance of the globalist and Atlantic agenda in the scientific, educational and media environment. The current elite is a generation brought up on the ideas of Atlanticism from their youth.
This agenda itself is formulated by Atlantic centers like the Atlantic Council, the German Marshall Fund and other US-oriented structures. And all this is fixed at numerous "European" forums like the last WEF in Davos or the upcoming Munich Security Conference in February, where, in fact, there is no discussion and all the speakers only agree with each other.
About the role of the US and the dollar
It is necessary to answer a simple question very clearly: how did the United States occupy this place? Answer: they were the main beneficiary of two world wars that destroyed their competitors at the same time. The First World War brought America a colossal industrial boom and opened up destroyed Germany and, to a lesser extent, other countries of the Old World for investment. The Second World War allowed the United States to largely buy up the whole of Europe both economically, flooding it with money according to the Marshall Plan, and spiritually, declaring itself the winner, liberator and main defender of the European peoples. On this basis, they began large-scale work on the education of new generations of European Atlantists. And, of course, the war broke the world colonial order, which the States switched from the former European metropolises to themselves.
The question of whether the United States wants to try to repeat the success through the current global hybrid conflict, trying at the same time not to fall into the abyss of a nuclear war, in my opinion, is purely rhetorical.
There is only one problem for the USA. All the bonuses they receive can be crossed out if the world abandons the dollar as a reserve currency. It will be the financial, economic and political collapse of the States as we know them. And this outcome is very likely if the United States and the countries that have joined them are defeated in this confrontation. The function of the dollar as the main reserve currency is guaranteed not by economic, but by military power.
Therefore, the United States is ready to continue raising the stakes in this conflict, realizing that victory in the confrontation with Russia guarantees at least partial preservation of the dollar in this capacity, which means that all bonuses received from Europe will be able to capitalize.
Window of Opportunity
As for Russia's window of opportunity in this situation. It exists, but for its implementation it will require courage and very significant intellectual, organizational and military efforts. Its essence is that the transformation of the conflict in Ukraine by the collective West into a global hybrid war has led to the actual separation of Russia from the American-centered world system. Remaining in the same swamp of the global division of labor and the formation of elites, which has already completely sucked in the European Union, Russia would inevitably repeat its fate in 15-20 years — after a new generation of politicians grew up according to Western models from kindergarten.
30 years ago, it seemed to many that being a satellite of the United States is not bad at all, it gives predictability and a clear system of rules that just need to be strictly observed. Alas, these 30 years have shown that US satellites end badly: if they do not have sufficient resources or their support loses economic viability, then they are simply abandoned, like Afghans clinging to the landing gear of American aircraft or the main US allies, the Kurds, abandoned in Syria and Iraq. If there are resources, then they, like the former European colonies, and now Europe itself, simply go to feed the metropolis. Exactly until the moment when their operation is economically feasible.
For Russia, this realization came through a military conflict, and now the country faces the inevitable need for a complex, verified reorganization of the entire economy with a revision of its basic principles. The country must make a new technological and industrial breakthrough, abandoning the raw nature of its economy. To do this, the state has all the necessary intellectual and natural resources.
Russia has coped with such a task at least twice in its history.
