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Spengler

B’rer Putin in the Briar, er, Bamboo Patch

April 30th, 2014 - 8:57 am

putin_briar_patch_4-30-14-1

Update: Bloomberg reports that Russia is seeking Chinese investment. What Bloomberg has a very superficial idea of what is at work: Russia and China now are collaborating on strategic technology. For example, Putin has approved the same of Russia’s new S400 air defense system to China, brushing aside past Russian rancor about Chinese reverse engineering of Russian systems. Russia has opened the door to Chinese tech investments in China which it previously prohibited.

“An historic investment-for-resources deal between Russia and China will neuter Europe’s punitive efforts over Ukraine and redraw the world’s energy map, but more importantly create a Eurasian dynamic that otherwise would take decades to evolve. In the 1970s, former US president Richard Nixon used the region’s complexities to divide Cold War enemies. Now his doctrine is being used against America,” write my Asia Times Online colleague Francesco Sisci today. I hope he’s wrong. Last month I noted in this space that Germany fears a Russian turn towards Asia more than any other outcome of the Ukrainian sitcom.

Sisci writes:

BEIJING — It has not happened yet, but expectations are already enormous. A massive strategic and economic shift is expected to result from Russian President Vladimir Putin’s to China in May.

After decades of fruitless talks, Moscow and Beijing are now likely ready to sign a sweeping deal which will see China invest billions of dollars in Russia, with vast resources being sold in the other direction. This correspondent first saw the agreement signed 20 years ago, when Boris Yeltsin and Jiang Zemin were the presidents, and not much occurred since. However, this time things seem to be real.

In the past, the two parties failed to finalize the fine print of the deal. There were too many differences on the price of gas, the route of the pipeline, the ownership of resources in Russia and on the distribution network in China. Now all these problems are solved — or so it appears — because of a sudden change of heart in Russia linked to the ongoing Ukrainian crisis.

The threat for Russia resulting from the crisis is that Europe will not buy its gas and oil, or will decrease its purchases. Oil prices have remained pretty low, despite the fact that the supply from other oil-exporting countries has been low or dwindling…

Now, and for the foreseeable future, problems with the oil supply hurt the producers far more than the Western consumers, who now have access to the American hoard. This makes it an issue of life and death for Russia to find an alternative consumer to Europe. Europe may suffer somewhat without Russian oil, but Russian economy could easily crack without its sales.

Now, apparently, China could realize up to 30% of its energy needs from Russia, which would equal over a third of the latter’s production. This will partially unload the European gun of not buying Russian oil and create a new dimension to ties in the whole Eurasian continent. Russian can play Europe against China and vice versa. Beijing knows this, and it is interesting to think about why China is willing to be played and help Russia in this way.

This seems a bit premature; Russia might not let its economic relations with Europe collapse so easily. Germany not only buys hydrocarbons from Russia: as The Economist reported recently, “Russia is Germany’s 11th-biggest export market, worth €36 billion ($48 billion) last year. The Committee on Eastern European Economic Relations, a lobby group representing big businesses, says that 300,000 German jobs depend on trade with Russia, 6,200 companies with German owners are active in Russia, and German companies have invested €20 billion there.” Russia does not relish the prospect of economic dependency on China. That is the logic of misguided Western policy, however. We may pull defeat out of the jaws of Cold War victory, two decades after the fact. The stupidity of Western policy is epic.

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Top Rated Comments   
I am not on the GWB blew it band wagon. The invasion and occupation of Iraq was geo-politically sound. That DoS and Dems were willing to sacrifice a good international position for internal grievance politics was not his fault, though I wish he would have fought harder and more publically.

The idea of introducing democracy and capitalism into the Mideast is not a bad idea in and of itself. Nowhere did I ever see (or hear, since I live in DC) anyone think it was the over riding concept or that it could be done in less than 2 or 3 generations, say the length of time we are in Germany. Mostly the Democracy for the ME idea was the cover, saleable to Wilsonian Libs, to allow the establishment of a strong geo-political base in the heart of the region. The idea ALWASYS required the next administration to be American first, and non-partisan. Obviously that ship sailed.

Any democracy that leaked into Iraq or the rest of the ME was icing on the cake.

Had BHO had even the most modest idea of the world and minimal loyalty to the United States, he could have forged a proper status of forces agreement that envisioned more strength in Iraq and less in Europe, with the net deployed US forces remaining constant. The SOF 'agreement' could (should) have been publically negotiated and privately dictated, as it has always been.

Finally, the idea of fighting wars and then coming home was dead and buried by 1922. Germany, Japan, Korea.

One armored division, one mechanized infantry division, one Marine BLT, a Naval station and an air base or two.

With that in place, let's revisit Syria.

Sorry, got to rambling there.
ta
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44 weeks ago
44 weeks ago Link To Comment
Cheap, plentiful energy makes for a robust economy and a foundation for growing a military. So we shut down electric plants and increase regulations on other energy to make it scarce and expensive. I need to learn to speak Mandarin.
44 weeks ago
44 weeks ago Link To Comment
Right now their using fossil water but when that runs out in 50 years they figure to have cheap desalinized water.
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The national geographic article says the Saudis will stop using fossil water in 2 yeas.

This NASA article says the saudis have a 50 years supply left.
http://www.nasa.gov/topics/earth/features/saudi-green.html

Whatever, the Saudis understand the problem. Like Israel, Singapore, Europe, China Japan Australia and the USA there is a worldwide push to crush the price of water desalination. Both Israel and Singapore have recently claimed that they're able to desalinate sea water at under $500 an acre foot. At under 150 @ acre foot expensive crops become profitable at world prices. At under $70@ acre foot field crops become doable.

Currently the biggest hottest materials reasearch worldwide is in graphene. It promises to be about like nylon in the 1930's or plastics in the 1960's. There's a lot of players racing to bring it to market for zillion different uses inclucing desalination. Combine graphene membranes and lftr thorium reactors and the price of desalination will make desalinated water in the world's deserts cheap and plentiful, enable desert farming, turn the world's deserts green, and double the size of the planet.

That would be a great campaign promise. Vote for me and I'll turn the world's deserts green. In the 1930's it was a chicken in every pot. In the 1980's it was star wars. Hey why not promise to turn the deserts green.

That would get people's attention.
44 weeks ago
44 weeks ago Link To Comment
All Comments   (40)
All Comments   (40)
Sort: Newest Oldest Top Rated
43 weeks ago
43 weeks ago Link To Comment
An excellent and cogent link. Mirrors Kaplan's "The Revenge of Geography."
43 weeks ago
43 weeks ago Link To Comment
If you read George Friedman's Next 100 Years, US is supposed to back Poland in a proxy war against Russia.
43 weeks ago
43 weeks ago Link To Comment
My how the world turns. In the thirties it was the Hitler Stalin Mussolini and Tojo pact with the squeeze on China and Britain, etc. Japan got nuked and Germany was carpet bombed. Now it may be the German Russian Sino pact with the squeeze on Japan the US, Britain and India. Given the current American regime, those who don't have nukes will now nuke up.
43 weeks ago
43 weeks ago Link To Comment
Actually, contrary to Goldman, the West IS "faced with another Hitler and another Sudetenland."

The nature of the threat is explained is the article linked below. Everyone should read it.

http://www.nationalreview.com/article/372353/eurasianist-threat-robert-zubrin
43 weeks ago
43 weeks ago Link To Comment
What most people don't seem to get is that in order to have a successful planet wide 21st century--the price of energy has to go down by an order of magnitude and its ubiquity and availability have to go up by an order of magnitude. That is just as oil and electricity in the 20th century came on top of coal and steam in the19th century (and coal and steam in the 19th century came on top of wood and water wheels in the 18th century) so also does another cheaper/better/smarter energy source in the 21st century have to come on top of oil and electricity which are products of 20 century technology.

My favorite and the one most like to break out into a very public worldwide competition in the next couple years is lftr portable thorium reactors. But make no mistake. There are a half dozen - to a dozen other potential candidates in the running in various stages of development.
43 weeks ago
43 weeks ago Link To Comment
In any case solar power is pretty much guaranteed to be below the price of cheapest natural gas/oil 10-15 years from now. Even the Saudis get that much. They also get that oil prices are cyclical--unlike the Russians. So in the future--they want use their oil for exports and not for internal consumption. They have committed to spending 110 billion dollars over the next 15 years on solar power..
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http://www.bloomberg.com/news/2012-11-22/saudi-arabia-plans-109-billion-boost-for-solar-power.html
Saudi Arabia, which is tapping renewable energy as a way to free more crude oil for export, is planning for $109 billion in investment to create a solar industry that generates a third of the nation’s electricity by 2032.

The world’s largest crude oil exporter targets 41,000 megawatts of solar capacity within two decades, according to the plan that was announced in May. Al-Suliman said 16,000 megawatt of that will be generated from photovoltaic panels. The rest comes from solar-thermal technology, which use mirrors to focus the sun’s rays on heating fluids that turns a power turbine.

Al-Suliman said that they want renewables and nuclear reactors to supply half of the Kingdom’s electricity in the coming two decades. Solar would supply a fifth of that energy.
..............
n
43 weeks ago
43 weeks ago Link To Comment
Cheap, plentiful energy makes for a robust economy and a foundation for growing a military.

That's coming but its ten years away. In 1980 oil was equivalent to about 106@ barrel in current dollars. Reagan took off price controls and eliiminate the excise profits tax in 1981. That knocked the price of oil down to $60@barrel in today's dollars. In 1985 he talked the saudis into increasing their production. That knocked the price of oil down to roughly $30@ barrel in 1989. That falling oil price bankrupted the soviet union and gave the USA a strong eonomy during the 1980's and 90's.

The same thing is going to happen ten years from now as fracking increases supply of oil and rising sales of natural gas trains trucks and buses and electric cars curb the demand for oiil
43 weeks ago
43 weeks ago Link To Comment
In international relations, when a debtor nation was unable to pay, the creditor nation would land troops at a port and collect the tariffs to pay for the debt.

Ukraine owes lots to Russia. Ukraine should say Russia's seizure of Crimea pays for the Ukraine's debt to Russia and for free gas for 25 years.

Western leaders should on the same day urge Putin to retire and enjoy traveling among the world capitals while managing his personal fortune of 700 billion dollars.
44 weeks ago
44 weeks ago Link To Comment
It is interesting that the anti-neo-cons make everything about the neocons. I never believed in Muslim nation-building, and wrote posts and articles to that effect. However. the fact that some Congressmen speak of Ukraine in simplistic terms does not really justify ignoring Russia and Putin's ambitions. I don't have to like Ukrainian nationalism to worry about those. I think David's articles on this topic are too glib.
44 weeks ago
44 weeks ago Link To Comment
Neo-cons are Dems in Conservative clothing. They and the debate between them and their estranged cousins in the Dem movement are not all that.

This whole neo-con, anti neo-con discussion has little to do with anything other than to distract the public.

sigh
44 weeks ago
44 weeks ago Link To Comment
Well, our European friends are helping mend the situation they provoked...

"In a crass and ill-timed intervention, the unelected president of the European Council Herman Van Rompuy has warned Vladimir Putin that the EU intends ultimately to control every country on the western flank of Russia."

He admits he does not know if there is public support for such a move, “But we do it anyway.”

http://www.breitbart.com/Breitbart-London/2014/05/01/van-rompuy-says-europe-will-expand-without-public-backing
44 weeks ago
44 weeks ago Link To Comment
"China said on Wednesday it would conduct joint naval drills with Russia in the East China Sea off Shanghai in late May, in what it called a bid to deepen military cooperation."

http://news.yahoo.com/china-conduct-naval-drills-russia-east-china-sea-182415119.html;_ylt=AwrBJR5_QGFTlk8AUU7QtDMD
44 weeks ago
44 weeks ago Link To Comment
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