What our great statesmen seem not to realize is that by taking Russia off of SWIFT, they are accelerating the development of alternative exchange mechanisms to the US dollar.
Now if the dollar loses its status as global reserve currency, the US will find it exceedingly difficult -- among many, many other things -- to finance its military. And this at a time when we will be competing against the combined resources of China + Russia.
Sounds to me like a losing hand.
And a very different financial scenario than the US arms race against USSR.
Again, we need a fundamental re-think of our entire foreign policy. If Russia were a third pole of power, allied with Europe, it could constrain China from the north and deny China strategic depth.
The bipolar order that is now emerging will favor China + Russia over the US. This will be painfully apparent should the dollar collapse as a result of the SWIFT shenanigans, which will cause Russia short-term pain, and the US long-term calamity.
Malaparte: There are some internal inconsistencies in your post above. I already in some post I wrote above been on record of the entire free trade agenda with states like China and Russia thinking they will change. They will not. Neither has a history of free elections, freedom of the press, nothing of the sort. Maybe a new generation of Russians will stay committed to what Gorbachev and Yeltsin started (he was not perfect)
but under Putin, that did not happen. End of discussion on that point from my perspective.
The Zero hedge article linked earlier is interesting. Other news agencies are also reporting that some sort of Chinese/Russian Swift system could occur and even under the current sanctions, the Yuan is not covered, so the Russians can still get payments on goods where the Yuan is the currency used for the transaction. But Malaparte, I have already noted Russia under Putin has been yes selling Oil and gas to Europe, but also doing the same thing to China. It has 12% of the Asia-Pacific energy market. Russia's other major commodity that it sells is totally dependent on Asian, and some African markets.
Very detailed article on Russia's grain exports and where the markets are. Obviously, the USA and Europe does not need Russian wheat and grain.
https://www.rbth.com/business/332948-russia-leading-wheat-exporter
So Russia, which sits on both Europe and Asia, is actually already integrated with Asian economies more than European. China, because of it sees the USA as its largest geopolitical threat, has worked with Russia to counter the USA. That has been going on for years. They have tended to abstain in every UN security council vote when Russia has moved on territory. On any international issue, that involves the USA, China and Russia have been tied at the hip since Putin took over 22 years ago. Economically and diplomatically, Russia has chosen to ally with China. And for the record, China and Russia have always since the 1950's been in some sort of informal alliance, not formal like NATO, to counter the USA.
As I noted earlier, Russia had a chance with Gorbachev and Yeltsin, even though he was not perfect, he did move to market reforms on the economy, but Russians never stayed with those reforms. The Former Soviet block countries in the East all took their medicine and transitioned to free elections, freedom of the press, private property, and some basic form of countries with democratic norms, that work for those countries and fit in within what the USA, UK, etc see as countries that are not military threats to their neighbors. FYI, I am not a fan of the unelected EU politicians imposing their views on every issue into sovereign European countries. The UK has clearly demonstrated it is a reliable NATO ally, trading partner and diplomatic ally to the USA, NATO and EU members without being in the EU, which in my view moved from a economic and free and fair trade union to a political one that imposes NGO and UN type liberalism, not classical liberalism, on to EU members.
So you might be correct, their may end up being 2 market systems and banking systems for world markets, One based on the US $ with SWIFT and European countries, and I would assume Japan is not going to go with the Chinese, neither or the South Koreans, and most certainty not the Australians and New Zealanders. The other one will be based on the Yuan and controlled by the Chinese working with the Russians. Where India goes in this, not sure, they have traditionally been on very, very, bad terms with the Chinese but good terms with the Russians since they, like the Chinese, rely heavily on Russian energy for their economy and they just announced a large bi-lateral trade deal with an estimated $30 Billion. So India is in a delicate situation. If I were a foreign policy advisor in the US government, I would be working to get better relations with India given their dislike of the Chinese (evidenced by numerous border clashes with China).
But if that occurs, that might be among the things that come out of this for the better (no War is a good thing). 1) NATO is re-configured and all member states share in the $$$ of that shared defense commitment, 2) breaking dependence on Russian Oil and Gas, seems there is already a move in Europe in some countries to do just that, and 3) 2 clear market and banking systems that the countries of the world can choose to align with and do business with. Those that want to go with China, as my old Grandfather use to say, leave and don't let the door hit you in a**, those that want to stay with the system used by the USA and Europeans based on the $.
Russia seems like it has already chosen, or more so, it never chose not to leave its informal alliance with China.
Cheers.
