What are the real reasons for this conflict? Is it the possibility of Ukraine joining NATO and, more broadly, the fact that NATO has expanded to include 14 new countries since the end of the Cold War (from 16 to 30 in 20 years)? Is it Ukraine’s inclusion in the European Union (EU)? These issues are undoubtedly part of the explanation, but we need to take a step back to get a better overview. We come closer to an adequate explanation if we do not overlook the USA’s striving for economic dominance.
However, reference to the hegemonic ambitions of the United States is not sufficient. It has to be stressed that a genuine anxiety has seized American leaders. This is due to the fear of finding themselves in a perilous financial situation, one that is fundamentally untenable. It has gradually dawned on them that, to prevent the country’s economic collapse, internal corrective measures alone would be of no avail. It was essential to violently attack Russian and Chinese competition.
Ukraine’s neutrality is an existential issue for Russia, not for the United States. American anguish could and should have been channeled into something other than a proxy war in Ukraine, but Russophobia has colored the outlook of successive American administrations for over a century.
He who lives by the dollar will perish by the dollar
At the end of the Second World War, the US dollar replaced gold as the monetary reference, but that change was a two-edged sword. It allowed the United States to borrow at a low interest rate, encouraging it to import more than it produced and gradually driving it into debt. Today, the US federal debt stands at $30,000 billion dollars. The U.S. trade deficit has widened to a staggering $1,000 billion a year. Since the U.S. GDP is around $25,000 billions, public debt already represents 120% of GDP.
Meanwhile, Russia has recovered economically and China’s continued momentum could, within ten years, allow it to overtake the United States as the world’s leading economic power. Worse still, trade between the BRICS countries is increasingly conducted in other currencies. China also wants to pay for Saudi oil in yuan. So the end of the petrodollar is foreseeable. If the supply of the dollar gradually outstrips demand, and the value of the US dollar falls, the ensuing inflation would not be explainable by rising wages and production costs, nor by the scarcity of goods, but first and foremost by the gradual decline in the value of the dollar, which is now becoming a persistent trend. Imports would become increasingly expensive because the exchange rate would not favor the US dollar. To prevent this outcome, the Federal Reserve must keep interest rates high in order to convince investors to buy federal bonds. But it will not always be possible to plug the gaps in this fashion.
Future scenarios point to a bleak future for US public finances. The Congressional Budget Office estimates that by 2052, one-third of government revenues will be devoted to servicing the debt. The federal debt could reach 185% of GDP by that date.
Panic at the White House
White House officials are now aware of their gigantic financial difficulties. They believe that the only way out of this downward spiral is to destroy international economic competition. If the U.S. economy succeeds in dominating the world, and its market expands at the expense of competition, the dollar will regain its strength and its place as a benchmark currency. The situation is so serious, however, that they have decided to pursue economic warfare by other means, specifically trying to destroy the Russian and Chinese economies by waging a proxy war against Russia in the Ukraine, followed by direct military confrontation with China, using Taiwan as a pretext. The policy can be summed up as: To stay afloat, sink others.
There is no “conspiracy theory” here. American leaders have literally implemented the suggestions of the Rand Corporation, listed in a document published in 2019 (‘Extending Russia’). This document recommended withdrawing from the Intermediate-Range Missile Treaty, strengthening NATO, imposing new sanctions on Russia, supplying lethal weapons to Ukraine, stopping Russia’s gas and oil trade with Europe, and halting the development of the Nordstream pipeline – provocations designed to force Russia to react and engage in costly wars.
Democratic Representative Adam Schiff, Republican Representative Michael McCaul, Secretary of Defense Lloyd Austin, Republican Senator Lindsay Graham, former Secretary of Defense Leon Panetta, Hilary Clinton and Oliver North have all spelled out that the USA is using Ukraine to weaken Russia. The Americans lit the fuse, set the world on fire and then poured fuel to the fire.
American military and financial support for Ukraine is not motivated by generosity or a sense of duty. It is about instrumentalizing Ukraine in a proxy war to bring down Russia. To understand the source of this policy and the economic and geopolitical stakes involved, it is necessary to look at the domestic economic situation in the United States.