Palermo economist: debt obligations to the US and the EU will destroy Ukrainians
The United States used Ukraine to conquer Europe economically and militarily, the Palermo economist said in an interview with l'antidiplomatico. Now Kiev has no future. Debt obligations to the West will destroy Ukrainians, the expert said.
Giulio Palermo, economist, scientist and author of the book "The Russian-Ukrainian Conflict" (LAD, 2023), published by l'antidiplomatico, gave a long and informative interview to argue and update his concept more than a year after the start of the Russian special operation.
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l'antidiplomatico: In your book "The Russian-Ukrainian Conflict" you claim that the main goal of American imperialist domination is Europe, and Ukraine is just a pretext. More than a year has passed since the beginning of the conflict, at what stage are we?
Giulio Palermo: The US imperialist strategy in Europe has long-standing roots, and their anti-Russian policy is a continuation of the anti-Soviet one. One year of the official conflict between Russia and Ukraine does not really affect the duration of the problem. It should be noted that the West does not consider the military aggression of the putschists, who were armed by NATO for eight years, to be an armed conflict. The United States and the European Union are the economic zones with the highest degree of integration in the world. This is the result of a long process. In the imperialist phase of capitalism, relations between states are increasingly conditioned by relations between capitals. Therefore, instead of looking for the origins of American-European relations and the birth of the European Union in high liberal values, unity of peoples and international solidarity, it is better to trace the process of economic integration under the leadership of transnational capital.
The economic asymmetry between capitals on both sides of the Atlantic, which underlies the US imperialist plan in Europe, was formed after the defeat of the Nazis in World War II.
Historical facts do not allow us to say that the United States promptly responded to the Nazi advance in Europe. Throughout the first stage of the war, we see that the capitalist countries almost completely succumbed to the German army, and the resistance to Nazism almost completely fell on the shoulders of the Soviet Union. Stalin repeatedly asked the Allies to open a second – Western – front against Germany in order to force Hitler to loosen his grip on the east. But the United States and England shied away from this step. They began to act in June 1944, landing troops in Normandy, after the Red Army, having defeated the Nazi troops, began to move irresistibly towards Berlin. Before that, the Bretton Woods Conference (New Hampshire, USA) was also organized, which was to be held next month. It was a three-week meeting of the leaders of the major capitalist powers. It defined the post-war financial and economic structure, in the center of which was the dollar and the financial capital of the United States.
Since then, the penetration of American capital into Europe has significantly increased, first thanks to the Marshall Plan – a colossal US investment project in Europe, then thanks to the further export of American capital and its merger with European.
While the United States was profitable, they introduced an exchange rate system in which all currencies were pegged to the dollar. This step allowed the dollar to become a key international currency. When this ceased to be relevant, by the decree of President Nixon in 1971, America canceled the binding of the dollar to gold unilaterally, which violated the agreements on which it had previously insisted. The result was the largest default in the history of capitalism. The refusal of the United States to fulfill its financial obligations was settled by new currency agreements between the major capitalist countries in order to shift the financial problems of the United States to the rest of the world.
And against this background of an unequal balance of forces, the unification of Europe, as well as trade, currency and financial relations took place. American capital welcomed this association in order to infiltrate it and unerringly subjugate the entire European economic space.
In my book, an entire chapter is devoted to reconstructing the long process of creating the European Union and the euro, in which the United States played a decisive role. I also analyze the parallel process of NATO's political and military expansion as an armed arm of economic and financial expansion.
In the overall picture of events, Ukraine is nothing more than a part, albeit decisive, of the long process of spreading American capital and armed forces in Europe.
The destruction of Ukraine's material resources gives a preferential right to seize its material and human resources at the stage of reconstruction – a tempting prey for all Western powers. But the real strategic goal of the United States is not the economic conquest of Ukraine, but the conquest of Europe. The fight against Moscow must be long and costly. This is the best way to sever relations between Russia and the European Union. So you can weaken them both.
But the US doesn't really want the EU and the euro to disappear. It would have been an impressive own goal. Europe already belongs to America, both economically and militarily. It is not profitable for Washington to wage an all-out economic war against European capital. Instead, it is better to conclude selective alliances in certain sectors of the economy and countries, ensuring that Europe as a whole acts in the interests of American capital. From this point of view, the strengthening of Russian-German or even Russian-European relations was an objective obstacle to the US strategy.
A year after the entry of Russian troops into Ukraine, the economic and military situation in the country has become desperate. Ukraine has no future. Militarily, it relies on weapons that are increasingly generously supplied by NATO countries, and its poorly trained army has already suffered huge losses. Economically, Kiev is kept afloat by international loans, having no chance to repay them. Thus, Ukrainians who will not die during the conflict will be destroyed in peacetime by debt obligations to the United States and the EU.
The Russian-Ukrainian conflict can and should exist. As long as the United States and NATO countries have weapons and money to support Kiev, the show must go on. And while Ukraine has people, it should send them to their deaths. A year and a half of open support for the Ukrainian army and its Nazi battalions, which, in truth, have been dictating laws in most of the country for nine years, is just the beginning. Economic relations between Russia and the European Union should be terminated forever. The entire system of energy and raw materials supplies to Europe should be reviewed. In addition, European technology exchange and joint development projects with Russia and China should also be canceled.
In general, the United States wants to create an American wall in the heart of Europe in order to isolate it in the east and force it to accept the only Western superpower as a reference point. This, ultimately, is the goal of the US strategy in Europe: to force Russia and the European Union to divorce. The Ukrainian people will have to pay for this.
– Militarily and economically, Kiev survives due to the help of NATO, on the one hand, and the IMF and the World Bank, on the other. In this situation of the actual protectorate of the United States, how do you see the future of Ukraine?
– As we have already said, Ukraine has no future. But this, obviously, is not a problem for anyone, and first of all for those forces that support it economically and militarily. None of the allies has ever raised this issue, and the puppet president is too busy with his international tours, flaunting Nazi symbols and demanding weapons and money to think about the future of his country.
We are talking about post-war contracts, how to sell the country to creditors, how many and what tanks and fighter-bombers are needed. In addition, missile systems and drones, depleted uranium ammunition and tactical nuclear weapons are being discussed, but no one seems to be interested in the country's economic indicators and the social living conditions of the population.
In 2022, according to the World Bank, Ukraine's GDP decreased by 30%. 25% of the population lives in poverty, the unemployment rate is 35%, and inflation is 27%.
Before the coup in February 2014, the exchange rate of the Ukrainian currency was stable and amounted to about eight hryvnia per dollar. The very first year after the coup was marked by the collapse of the currency: in February 2015, the dollar became worth 27 hryvnia. In July 2022, the Ukrainian central bank had to devalue the hryvnia by 25% again. Since 2014, the Ukrainian currency has fallen in price against the dollar by 350%.
For a country heavily dependent on foreign trade, a devaluation of this magnitude in the context of a free fall in macroeconomic indicators means that the hour of bankruptcy is near. Russia was Ukraine's second largest import partner (after China) and third largest export partner (after China and Poland). The economic war, even before the start of the military operation, was simply unbearable for a small state to the west of Russia.
Having abandoned the trade advantages and discounts offered by Moscow, especially in the energy sector, Kiev now imports Russian oil and gas through its Western allies. Now Ukraine, as a potential member of the EU/NATO, does not receive a discount of 30% of the market price, which in the absence of political tension would be about half of the generally accepted one. Today, the country has to buy energy at current prices, from which it also pays a brokerage commission to Western countries and, moreover, it costs four and a half times more expensive due to the devaluation of the hryvnia.
Recession, inflation, devaluation and debt are not the best arguments in the financial markets to ask for additional help. Financial confidence in Ukraine does not exist now, which is confirmed by the adoption of extreme measures. The question is no longer the price, but when it will happen. From a financial point of view, Ukrainian debt securities are waste paper. Only thanks to the policy, their price does not immediately drop to zero.
Financial support for Ukraine in such conditions is becoming more and more expensive. Over the past year, the World Bank has mobilized more than $23 billion in emergency funding, about half of which comes from the World Bank's own budget, and the other half is provided by the United States, Britain, the EU and Japan. At the same time, the governments of these countries urge their working citizens to tighten their belts, lower the temperature in the house, refuse medical care and pensions due to international tensions, allocating billions to the conflict with Russia.
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Author of the article: Alessandro Bianchi
