Putin’s Russia Accelerates Its Own Decline

Putin’s aggressive rush to war in Eastern Europe appears to be a misguided attempt to jack up global oil prices. The Russian government is deeply dependent upon oil & gas revenues, and while the price of oil remains below the $130 to $150 bbl range, the government is forced to draw from its reserves to pay for routine expenditures. This is due to many reasons, including Putin’s ambitious and lavish spending habits and the slow and increasingly debilitating effects of sanctions against Russia by the outside world. So it is that Putin seems to go to war as casually as Obama goes to the country club, just to boost oil prices.

Russia appears to be intervening more aggressively in the war in eastern Ukraine in what American and Ukrainian officials call a dangerous escalation that will almost certainly force more robust retaliation from the United States and Europe.

Russia has increased its direct involvement in fighting between the Ukrainian military and separatist insurgents, moving more of its own troops to the border and preparing to arm the rebels with ever more potent weapons, including high-powered Tornado rocket launchers, American and Ukrainian officials said on Friday.

Investigators examining wreckage of Malaysia Airlines Flight 17. Ukraine ceded control of the inquiry to the Netherlands, which has been monitoring the bank accounts of the crash victims.

… Russia had positioned heavy weapons, including tanks and other combat vehicles, at several points along the border where there has been intense fighting. On Thursday, Russia unleashed artillery attacks on eastern Ukraine from Russian territory … NYT

Russia’s stock market and currency dropped Monday as investors girded for the worst.

“The room for maneuver is now minimal,” says Alexei Makarkin, analyst at the Center for Political Technologies, a Moscow political consultant.

“From the pragmatic point of view, it would probably be best to pull back” and allow the Ukrainian military to defeat the separatists, he said. “But now that’s very difficult. The public wouldn’t understand.” __WSJ

Putin is unable to change his militant tactics due to the energy calculus under which his government operates. Worse, Putin’s dreams of empire force him to ramp up both spending and threat behaviours.

Of course Putin is not the only kooky guy in Russia. Being kooky seems to be a Russian tradition in many ways.

I recently moved to Moscow, and it’s hard to miss the extent to which Russian society exists in an alternate universe. Even well-educated, sophisticated people who have traveled widely in Europe and North America will frequently voice opinions that, in an American context, would place them alongside people wearing tinfoil hats. Russia is not living in the reality-based community. _WaPo

Russia stole Yukos and owes $50 billion
Sanctions against Russia have barely begun, although Putin can still joke about Russia’s invulnerability to any action by the outside world.

Russians prefer to live in Kiev over Moscow

Russia continues to suffer from brain drain, capital flight, womb drain, population loss in Siberia, sky-high death rates alongside low birth rates for ethnic Russians, dismal rates of HIV, TB, alcoholism, tobacco abuse, suicide, violent crime, corruption, and a lack of economic opportunity and high risk for doing business. Russia may even cease to exist as a state, by 2100.

Homicide Rates by Nation

Homicide Rates by Nation

Business Risk by Nation

Business Risk by Nation

Putin is not the only world leader who is divorced from reality

More: Can US energy exports foil Tsar Vlad’s neo-imperialist schemes?

Capital flight hurting Russia as capital sanctions gain traction

Russian sanctions threaten to send Russia back to the technological stone age

As economic conditions inside Russia continue to tighten, all of Russia’s many problems — including the loss of its best and brightest — only get worse.

More: Thanks to Putin’s violent aggression, Russia’s energy future in limbo

Putin’s war slipping out of control

Kremlin hardliners may blow under pressure

A small peek into the problems of Russian military production:

Russian engines have long been noted for their low reliability, and short service lives. There are currently two Russian engines being built for fighter aircraft. The $4 million AL-31 (for the Su-27/30, and the Chinese J-11, J-10) and the $3 million RD-33/93 for the MiG-29 and the Chinese JF-17 (a F-16 type aircraft developed in cooperation with Pakistan) are big export items and a major source of income for the Russian firms that build them. The AL-41 is supposed to be good for 4,000 flight hours (compared to 3,000 hours for the AL-31). Accidents like the one in 2009 are expected during aircraft development, although in the last decade, Western aircraft developers have avoided such losses by doing a lot more testing via computer simulation. The AL-31/41 has been the cause of several Su-30 mishaps recently and the Russians are still seeking answers. It’s is obviously not easy. The Al-31 itself is five meters (16.3 feet) long and weighs 1.6 tons. They are complex bits of engineering with thousands of precision parts. There is a lot that can go wrong. India understands this but the abnormally high number of engine failures in 2012 and 2013 and Russian inability to fix problems that have been present since before 2008 is very worrisome. It should be to Russia as well because India currently operates about 40 percent of Su-30s in service. That’s twice as many as China (which operates more than Russia). __ StrategyPage

Russia sells a lot of arms because its products are cheaper for the nominal firepower. If the reputation of Russian arms continues to fall — because quality control in military production is falling to the low levels of all other Russian industrial production — prospective customers may look to France or other arms producers instead.

If sanctions make it difficult for Russia to upgrade its petroleum production, it will need every bit of hard currency export income it can get from sources other than energy exports.

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10 Responses to Putin’s Russia Accelerates Its Own Decline

  1. bob sykes says:

    The Russian incursions into Ukraine have absolutely nothing to do with oil and everything to do with history and Russian paranoia.

    Until 23 years ago,Ukraine had been an integral part of Russia for over 300 years. That’s 40 years before the unification of Scotland and Ireland, more than 100 years before the American Revolution and more than 200 years before the unifications of Germany and Italy. Ukraine is more a part of Russia than Ohio is part of the USA.

    All countries are not equal and do not have equal rights. A country’s rights depends on its history, its location and its military and economic power. America is the world’s hegemon because of its huge natural defenses (Atlantic and Pacific), because there is no second or even third level power near its borders, because it has overwhelming military and economic power and because history has destroyed to old European imperial powers. Consequently, America does whatever it wants and disregards consequences and intimidates whomever it wants. That’s America’s right.

    Ukraine, besides its history and poverty, is located between major powers. It can never have real independence and it will always be controlled by one power of the other. It has no rights that any real power, most especially Russia, need recognize (para. Taney).

    The only way Ukraine can be even semi-independent is if it is Finlandized. It must be neutral. It cannot be part of NATO nor a regular member of EU. If there is to be peace in Europe, it might have to be partitioned, and the eastern part might even be reunited with Russia.

    There are only two sides in this crisis–the US/EU/NATO, who precipitated the crisis, and Russia who has reacted out of fear and ambition. Ukraine doesn’t count. Both sides have been engaged in a tit-for-tat escalation that can easily lead to a pan-European war, which would quickly become nuclear and engulf the world. Either one or both parties will have to climb down and agree to negotiations over Ukraine’s fate.

    • alfin2101 says:

      Petroleum is an existential resource for the Putin government, and can never be ignored in Russian geopolitical calculations. Overlooking such crucial elements of Russian thinking is a common mistake in the west, responsible for many missteps.

      When Reagan moved to force down oil prices, the Soviet regime was badly hurt. Obama — if he were an intelligent leader and had intelligent advisors — could easily accomplish something similar, to force neo-imperialist Russian invaders out of countries where they are not welcome.

      Putin is popular among the alcoholic low-life population — and among political cronies, mafia thugs, and the warlords that he pays off with petroleum profits. Without those profits, he cannot buy his popularity, and Russia would have to learn to behave in a more civilised manner.

      Most Russians do not want to provoke a nuclear war in order to support Putin’s grandiose fantasies.

  2. jabowery says:

    WD Hamilton’s “Innate Social Aptitudes of Man” discussed the contribution of barbarian pastoralist invasions to European renaissances — and the inevitable decline resulting from technology transfer to populations with low genetic correlation to the risk-takers. Of course, Hamilton’s renaissances were not transferring nuclear weapons technologies — so the inevitable declines did not entail global destruction and left barbarian pastoralists around to revitalize the mercantile thoughtfulness.

    This time around it is a little different.

    There are no undomesticated peoples left in harsh/temperate climates. They’ve all been domesticated.

    Moreover, the nuclear weapons technologies are not only proliferating, they are increasingly exposing the fundamental moral hazard represented by civilization in its inherent centralization of authority. Such centroids are more than mere attractive nuisance — they are an inescapable and deadly consequence of civilization’s group selectionist evolution:

    There will always be psychopaths grabbing control of the nuclear stockpile nearest them — even if they destroy the infrastructure required to manufacture the stockpile.

    • jabowery says:

      Well, its a pretty safe assumption that all sides of the conflict in the Ukraine (there are several) are under the command of psychopaths, but some of the psychopaths are more dependent on civilization than others. Putin and his cronies are probably a lot more capable of coming out on top of a civilization-destroying hot conflict — including one that kills most Russians — and are probably quite conscious of this fact. The removal of nukes from Ukraine under the influence of NATO is an interesting twist that places the onus on NATO to handle Putin’s oligarch-bred brinkmanship. That means the US gets nuked along with Europe.

  3. alfin2101 says:

    Unknown. Left on a doorstep in a village of the Transylvanian Alps, during a period of frequent UFO sightings. Was fortunately able to avoid the orphanage and Ceausescu’s brutal regime to successfully flee to the relative freedom of the west. I often look to the clear night skies from my mountain home, wondering . . .

    • Hell_Is_Like_Newark says:

      Not sure what part of that is true.. the UFOs or having escaped Ceausescu. I remember having a teacher (public school) who used to talk glowingly about him and the other Soviet puppets of Eastern Europe. Even today I wondered what went through his mind as all his heroes were thrown out of power and in Ceausescu’s case.. lined about against a wall and shot.

  4. guest says:

    Now i get it, alfin, as in alien life form!

  5. Sam says:

    Al Fin is obviously Jewish.

    • jabowery says:

      That’s high on my list of hypotheses but if so he’s a uniquely interesting Jew: probably would make my list of “Righteous Jews” by my imputation of the missing data; but the data _is_ missing and imputation is not observation. One thing that makes me a tad suspicious is the fact that for years I’ve been condemning JudeoChristian ministers for failing to — and these are my words — equip their young men, by the age of 18, with the debt-free resources, material, moral, educational and social, to support a family. This is a powerful enough idea that it justifies a resumption of the Viking Raids against the JudeoChristian churches for being de facto temples of Mammon as they turn their young people over to the tender mercies of The Beast to try to make next month’s rent. Great minds may simply think alike, but I’ve not run across anyone but Al Fin that is as close to saying what I’ve been saying.

  6. alfin2101 says:

    Well, alien, Chinaman, or Jew, it is unlikely that the Al Fin syndicate will suddenly stop being critical of the neo-imperialist regime currently in power in Russia, a nation in despair. Quite the opposite, in fact. Blog administrator Alice Finkel and chief financial officer Xi Chao Ling are in full agreement with Editorial Chief !Kn#g& Znk* that the Potemkin punk Putin must pay a price for his lawlessness.

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