The Deep State versus WikiLeaks



The non-stop demonization of Julian Assange will proceed unabated, faithful to guidelines established over a decade ago.


by Pepe Escobar

Strategic Culture Foundation (April 19 2019)

The Made-by-FBI indictment {1} of Julian Assange does look like a dead man walking. No evidence. No documents. No surefire testimony. Just a crossfire of conditionals.

But never underestimate the legalese contortionism of US government (USG) functionaries. As much as Assange may not be characterized as a journalist and publisher, the thrust of the affidavit is to accuse him of conspiring to commit espionage.

In fact, the charge is not even that Assange hacked a USG computer and obtained classified information; it’s that he may have discussed it with Chelsea Manning and may have had the intention to go for a hack. Orwellian-style thought crime charges don’t get any better than that. Now the only thing missing is an AI software to detect them.

Assange legal adviser Geoffrey Robertson – who also happens to represent another stellar political prisoner, Brazil’s Lula cut straight to the chase {2 at 19:22 minutes}:



The justice he is facing is justice, or injustice, in America … I would hope the British judges would have enough belief in freedom of information to throw out the extradition request.


That’s far from a done deal. Thus the inevitable consequence; Assange’s legal team is getting ready to prove, no holds barred, in a British court, that this USG indictment for conspiracy to commit computer hacking is just an hors d’oeuvre for subsequent espionage charges, in case Assange is extradited to US soil.

All About Vault 7

John Pilger, among few others, has already stressed {3} how a plan to destroy WikiLeaks and Julian Assange was laid out as far back as 2008 – at the tail end of the Cheney regime – concocted by the Pentagon’s shady Cyber Counter-Intelligence Assessments Branch.

It was all about criminalizing WikiLeaks and personally smearing Assange, using “shock troops … enlisted in the media – those who are meant to keep the record straight and tell us the truth”.

This plan remains more than active – considering how Assange’s arrest has been covered by the bulk of US/UK mainstream media.

By 2012, already in the Obama era, WikiLeaks detailed the astonishing “scale of the US Grand Jury Investigation” of itself. The USG always denied such a grand jury existed.



The US Government has stood up and coordinated a joint interagency criminal investigation of Wikileaks comprised of a partnership between the Department of Defense (DOD) including CENTCOM; SOUTHCOM; the Defense Intelligence Agency (DIA); Defense Information Systems Agency (DISA); Headquarters Department of the Army (HQDA); US Army Criminal Investigation Division (CID) for USFI (US Forces Iraq) and 1st Armored Division (AD); US Army Computer Crimes Investigative Unit (CCIU); 2nd Army (US Army Cyber Command); Within that or in addition, three military intelligence investigations were conducted. Department of Justice (DoJ) Grand Jury and the Federal Bureau of Investigation (FBI), Department of State (DOS) and Diplomatic Security Service (DSS). In addition, Wikileaks has been investigated by the Office of the Director of National Intelligence (ODNI), Office of the National Counterintelligence Executive (ONCIX), the Central Intelligence Agency (CIA); the House Oversight Committee; the National Security Staff Interagency Committee, and the PIAB (President’s Intelligence Advisory Board).


But it was only in 2017, in the Trump era, that the Deep State went totally ballistic; that’s when WikiLeaks published the Vault 7 {4} files – detailing the CIA’s vast hacking/cyber espionage repertoire.

This was the CIA as a Naked Emperor like never before – including the dodgy overseeing operations of the Center for Cyber Intelligence, an ultra-secret NSA counterpart.

WikiLeaks got Vault 7 in early 2017. At the time WikiLeaks had already published the Democratic National Committee (DNC) files – which the unimpeachable Veteran Intelligence Professionals for Sanity (VIPS) systematically proved was a leak, not a hack.

The monolithic narrative by the Deep State faction aligned with the Clinton machine was that “the Russians” hacked the DNC servers. Assange was always adamant; that was not the work of a state actor – and he could prove it technically.

There was some movement towards a deal, brokered by one of Assange’s lawyers; WikiLeaks would not publish the most damning Vault 7 information in exchange for Assange’s safe passage to be interviewed by the US Department of Justice (DoJ).

The DoJ wanted a deal – and they did make an offer to WikiLeaks. But then FBI director James Comey killed it. The question is why.

It’s a Leak, Not a Hack

Some theoretically sound reconstructions {5} of Comey’s move are available. But the key fact is Comey already knew – via his close connections to the top of the DNC – that this was not a hack; it was a leak.

Ambassador Craig Murray has stressed, over and over again (see here) how the DNC/Podesta files published by WikiLeaks came from two different US sources; one from within the DNC and the other from within US intel.

There was nothing for Comey to “investigate”. Or there would have if Comey had ordered the FBI to examine the DNC servers. So why talk to Julian Assange?

The release by WikiLeaks in April 2017 of the malware mechanisms inbuilt in “Grasshopper” and the “Marble Framework” was indeed a bombshell. This is how the CIA inserts foreign language strings in source-code to disguise them as originating from Russia, from Iran, or from China. The inestimable Ray McGovern, a VIPS member, stressed how Marble Framework “destroys this story about Russian hacking”.

No wonder then CIA director Mike Pompeo accused WikiLeaks of being a “non-state hostile intelligence agency”, usually manipulated by Russia.

Joshua Schulte, the alleged leaker {6} of Vault 7, has not faced a US court yet. There’s no question he will be offered a deal by the USG if he agrees to testify against Julian Assange.

It’s a long and winding road, to be traversed in at least two years if Julian Assange is ever to be extradited to the US. Two things for the moment are already crystal clear. The USG is obsessed to shut down WikiLeaks once and for all. And because of that, Julian Assange will never get a fair trial in the so-called “Espionage Court” of the Eastern District of Virginia, as detailed {7} by former CIA counterterrorism officer and whistleblower John Kiriakou.

Meanwhile, the non-stop demonization of Julian Assange will proceed unabated, faithful to guidelines established over a decade ago. Assange is even accused of being a US intelligence operator, and WikiLeaks a splinter Deep State deep cover operator.

Maybe President Trump will maneuver the hegemonic Deep State into having Assange testify against the corruption of the DNC; or maybe Trump caved in completely to “hostile intelligence agency” Pompeo and his CIA gang baying for blood. It’s all ultra-high-stakes shadow play – and the show has not even begun.









The Most Horrifying Look at Monsanto Yet

by Natasha Hakimi Zapata, Assistant Editor / Poetry Editor

Truthdig (April 22 2019)

Joe Brusky / CC BY-NC 2.0

“Fear is the best weapon to awaken the reader”, says Samanta Schweblin, the acclaimed Argentine author of Fever Dream.



Fear is what makes you drop a book and run to your computer to Google what is happening, and think, “Can this happen to me? Is this really happening?”


Fever Dream certainly terrified readers across the globe after it was translated from Spanish into more than a dozen languages over the past few years. It was first published in English in 2017 and received ample critical acclaim, in part due to her considerable talent as a writer, but also due to the timeliness of the subject at hand: the horrors companies such as agrochemical giant Monsanto have inflicted on the planet and us all.

In her novella, however, Schweblin never names Monsanto, but rather tells the spine-chilling tale of Amanda, a city-dweller, mysteriously dying during a vacation to the countryside. Where does this horror story take place? you may ask. The answer is anywhere, given the multinational company’s harrowing reach. On her deathbed, Amanda is visited by a child who attempts to lead her and, perhaps more importantly, Schweblin’s readers, toward the realization that is likely on the tip of many readers’ tongues as the seemingly fictional ailments and occurrences start to form a familiar pattern. Wake up, the ghostly David seems to tell us as we all lie on our laurels during the planet’s death throes. “That’s the story we need to understand […] Don’t get distracted”, the child repeats over and over.

It is precisely as the global public begins to wake up, in large part thanks to young activists such as the courageous Greta Thunberg, to the barbarous damage done to the planet in the name of boundless greed that stories such as Schweblin’s can become an important tool in the fight against climate inaction. But this fever dream that feels inescapable currently is not just about climate change. According to writer Patricia Stuelke, “the recent resurgence of horror in feminist literary fiction in Argentina [and] the United States”, of which she considers Schweblin’s Fever Dream a prime example, is also undeniably a product of capitalism. Schweblin’s work,



… continues the long tradition Mark Stevens traces in which […] “a critique of [capitalist] horror”, he suggests, “produces horrific forms”. In this sense, the energy and aesthetics of the Argentine and international feminist remaking of the strike against capitalism’s “gore realities” are infusing, and perhaps being infused by, the feminist horror boom. These works repurpose horror conventions in order to confront the entangled forces of environmental destruction, financialization, and extraction, and the exploitation of women’s labor …


Graciously, Schweblin’s tales also make for great literature. Once looped into the eerily familiar stories the Argentine author crafts masterfully, it can be hard to put her books down, despite the creeping terror that inevitably takes hold. Both Fever Dream and her most recently translated collection of stories Mouthful of Birds have been nominated for the Man Booker International literary prize. Fever Dream is also currently being adapted by Netflix and is due to hit screens worldwide in 2019.

In a discussion about everything from agrochemicals to women’s rights, I caught up with Schweblin at her current home in Berlin, Germany, during a recent phone interview. What follows is a lightly edited transcript of our conversation translated from Spanish.

Natasha Hakimi Zapata: Before talking about your recently translated collection of short stories, Mouthful of Birds, I’d like to talk a little about your novella Fever Dream, a book I have seen described as an eco-horror.

The delirium depicted in your book is especially frightening to me because it sounds so familiar in this era of climate change. Can you tell me a little about why you decided to write about this topic?

Samanta Schweblin: Honestly, when I start writing a new story, I never start by choosing a topic, rather what I’m after is a kind of feeling, emotion, emotion in the reader.

The issue is not something that is self-imposed, but something that arises in the middle of the search for how to convey this feeling to the reader.

Of course, it’s charged with personal experiences, and information that I’m mulling over at that moment. When I started writing Fever Dream, which was in 2013 – the end of 2012, the beginning of 2013 – there was a very big controversy in Argentina. People were beginning to talk about something that had been going on for some time, but had not reached the media, which is the horror of the crops of an industry that is based on crops that abuse the agrotoxins.

The horror that this generated in communities, which were literally dying intoxicated, was huge. This is more or less where the topic came from – in a way I approached it as a concerned citizen.

In Argentina, Fever Dream was read as a very political novel. The reception caught me off guard because I think, it’s a novel that does not provide enough information to be called political but, of course, it was the first novel, the first work of fiction, that addressed the subject of glyphosate and Monsanto.

I had not realized that what I was writing could have such a significant impact on society, but ultimately, I was writing about a topic that at that time nobody spoke of and that would be new to many people.

[As I was writing Fever Dream], I thought,



Can I afford to write about a topic like this and not denounce or name governors who had agreed to incredible laws that left citizens defenseless, or not mention nefarious statistics about the consequences of these fumigations or name brands, even?


I was dealing with this struggle between journalism and fiction.

In the end what I realized is that the readers – myself included – always tend to forget the names, the statistics, the numbers; but we never forget terror when we really feel it. Fear is the best weapon to awaken the reader.

Fear is what makes you drop a book and run to your computer to Google what is happening, and think, “Can this happen to me? Is this really happening?”

That seemed to me to be a stronger weapon than any information I could offer in the book, information that ultimately the book could not hold well because the book is simply the story of a woman who is dying in a field.

Later I realized that it was a good decision and that many people responded by informing themselves once they [had read Fever Dream].

Another interesting political thing is that when this book began to circulate and to be translated – it has a lot of translations, I think it has twenty translations already, to different languages – I noticed something very interesting. In societies that are very clear about the danger of agrochemicals, the novel was read as political immediately. Without hesitation, they arrived at that reading.

Then there were the societies that did not have this information. There are a lot of issues that are discussed in the book about the consequences of fumigations in fields: thousands of spontaneous abortions, children with malformations, people with cancer, respiratory problems, animals that suddenly transform and die. [In these societies, people] read all this as fantasy, as if they were reading about ghosts and strange children and phantasmagoric animals that suddenly died. [Witnessing this reading of my book], I became aware of how fanciful societies become when they have no information.

NHZ: How fascinating. When I read Fever Dream, I immediately began to recognize precisely what I read in the news and it is not one single story, but many stories around the world, as you are saying. It is something that has not only happened in Argentina.

I think it was also a good decision precisely because it translates into this horror story and a story too, because we as readers connect a lot with the main characters – the dying woman and the ghostly child. It leaves us with a very strong impact.

SS: Sure. Do you know that a movie is being filmed right now?

NHZ: No, I did not know.

SS: Yes, they are filming at this moment in Chile and in Argentina. It will be called Distancia de Rescate [in Spanish]. It is being filmed by Claudia Llosa, who is an excellent Peruvian film director. I received a lot of offers, but when [Llosa’s offer] appeared I did not hesitate to say yes because I’d been following her work for a long time.

We wrote the script together and Netflix is ​​financing it, so in a very short time, it’ll be available to watch.

NHZ: That’s great! […] Well, I’d like to talk a little bit now about Mouthful of Birds. Many of the stories in the book deal with the subjects that affect us daily, but are told through a surrealist narrative. What does surrealism permit you to convey that realism doesn’t? Do you consider it surreal? I do not know if I’m imposing my point of view.

SS: I think that some stories can be surreal at times, but I do not consider them surreal, although I do not deny your perspective at all. I love that you have that reading. Rather, it seems to me that they are stories that take place in the realm of the strange, of the abnormal.

Surrealism leaves room for more questions about the real world. It seems to me that [any type of surrealist work] questions the real and the normal from start to finish … On the other hand, it seems to me that these stories take place in the real and, at some point, break with it. Not all, but most. I like that moment of breaking the real, that moment where the normal disintegrates.

These stories were published for the first time ten years ago. There are even some of these stories, such as “The Test”, “Headlights”, “The Heavy Suitcase of Benavides” and there is one more, now I do not remember which, [ … ] which were taken from my first very first book [which was published when I was] 22.

I think the book is the equivalent of what a painter would create when trying out a palette of colors for the first time.

I moved from genre to genre, but in general it is a moment in which I was thinking a lot, as I was entering the adult world, about the rules, about the codes, about what is established socially as acceptable or unacceptable.

I realize now looking back how uncomfortable I felt, how arbitrary I found that concept of normality. The idea that between you and me there is an intermediate point and that point is what we call normal. But in reality, neither you nor I are standing at the point, so the normal is an invention […] if something does not fall within the norm, it does not mean that it does not exist or that it cannot happen. I think [Mouthful of Birds is composed of] stories that are always approaching that breaking point [I discussed earlier].

In fact, except for one or two stories that absolutely take place in the realm of the fantastic or the surreal, as you said, I believe that in all the rest, the element of the fantastic happens in the reader’s head. It would be strictly impossible to underline where the fantastic appears, that’s to say, what is an impossible occurrence in this world cannot be identified in the text. It is rather something that the reader utters in a low voice to themself, but in reality the text never makes it explicit.

NHZ: Going back to Mouthful of Birds, the first story in the collection “Headlights”, where we met a crowd of newly married and abandoned brides in a field, waiting, screaming, and lamenting. In the end we see that their boyfriends were not very far away and they return to the scene of abandonment, not for their wives but for a single man that was left behind. Is this a comment on modern marriage and on the limited relationships that can take place between men and women under patriarchy?

SS: [laughs] I would never give away those clues. It seems to me that my intention is to question the entire scene. There is something very theatrical for me about marriage. Not marriage as in the civil act of getting married, but rather especially a Catholic idea of marriage, which is still very popular in Argentina, even among non-Catholics who wouldn’t dream of getting married without the white dress, church, and a priest’s blessing.

There is a theatricality surrounding the clothes and formalities which to me represents a lot of ideas of marriage that are outdated. Our mothers and grandmothers have suffered them and now they sound a bit funny to us, and some don’t even seem outrageous anymore because of how far we’ve come.

That’s why [the story is] written in prose that seems to be very realistic, but deep down it’s so theatrical that it even has a choir of voices. I even think it’s theatrical also in terms of lighting. It’s a story that happens in the dark and every so often cars pass by or something happens that sheds light on the faces, and they are revealed and recognized.

NHZ: Speaking of women, I wanted to ask you a bit about how you see the situation of women in Argentina. I’m thinking of course about movements like “Ni Una Menos” that have developed as a protest against femicide and other forms of violence against women.

SS: Obviously, in order for movements like these to form, we need to have reached a very high level of incipient violence, which is terrible, but the reality is that these movements have made great changes in Argentine society, changes that they are even spreading to the rest of Latin America.

Really in these last two years, there has been a leap in the Argentine paradigm about women, and we owe it to these movements and also to all the women who fought in favor of the legalization of abortion.

Although abortion was not legalized [in Argentina], the fight was very strong; it was a cross-generational, political struggle. All the problems that Argentina was dealing with at that moment always seemed to divide us into A and B. But the problem of abortion seemed to touch everyone at the same time and that was very important because then, it seems incredible, but the abortion debate ultimately served as a bridge towards other discussions.

Though abortion wasn’t legalized, the topic made so much noise and it became so clear that the vast majority of Argentine citizens wanted to legalize abortion, that in some way it left the political system in crisis.

Imagine how strong the impact was. I think it was very good and, of course, this also brought a new energy to literature written by women in Argentina. Suddenly a lot of fiction writers … began to find places to publish, to be heard. So it is very gratifying to see that many doors have been opened for women in recent years in Argentina.

This does not mean that the extreme level of violence against women has decreased. And abortion remains illegal in Argentina. I am deeply ashamed that a democracy like Argentina’s does not have legalized abortion.

NHZ: It’s not just in Latin America where women are fighting for similar issues, but also in the United States and Europe with the #MeToo movement. I’m not sure it’s also reached Germany, where you live, but for example, it’s reached France. I think what we’re experiencing is a global change in women’s rights, or at least, in how we fight for them.

SS: Yes. I was thinking how on a global level, doors have been opened for literature written by women.

It’s funny because more than once I’ve been asked if I think this is a passing fad, and I’m stunned by that question because to me it’s not a fad. To me it’s about what half of humanity writes. It seems silly to think that this is just a passing trend.

It seems to me that what’s happening is that when a minority voice suddenly comes under the spotlight, it brings with it a very different world view: a very new voice, new themes, a freshness and a power that any voice that has been displaced until now contains. And that’s part of why writing by women around the world is so strong right now.

MMT Has Been Around for Decades

Here’s Why It Just Caught Fire

by Ben Holland and Matthew Boesler

Bloomberg (March 11 2019)

Over a lifespan of about three decades, Modern Monetary Theory (MMT) has often been badmouthed – by obscure bloggers. Not by the likes of Jerome Powell and Larry Fink.

The economists who developed it mostly operated on the periphery of academia and the internet. Now their ideas have broken into the mainstream. Hardly a day passes without some Wall Street titan or policy heavyweight weighing in – usually to dismiss the doctrine, though there’s been support too.

Ignored for years, MMT suddenly finds itself at the center of America’s economic debate, raising the question: why now? Here are some possible answers.

Already in Deficit

The theory’s headline argument is that governments with their own currencies have more room to spend than is generally supposed, and don’t have to finance it all with taxes. According to this view, there’s no risk of the US being forced into default because it can create the dollars it needs to meet any obligations.

The claim may look less contentious today because the US has already been piling up public debt for a decade. The initial surge came out of crisis firefighting, a fairly orthodox response to the Great Recession. But fiscal stimulus is now being used to make an already expanding economy grow faster – on a scale that hasn’t been tried since the 1960s.

Trump’s Bump

Average growth is 59 basis points faster than during the Obama recovery, and a deficit-spending government delivered most of them.

Source: Bureau of Economic Analysis
Note: Households = consumption + residential investment. Business = other private investment.

That’s why advocates say MMT shouldn’t be seen as a policy package that might get adopted one day. Instead, it’s more like a framework for understanding what tools are available to a government. And some of those tools are already being used.

Easy Markets

“Deficits are going to be driving interest rates much higher”, BlackRock Inc Chief Executive Officer Fink said last week, describing MMT as “garbage”.

Sentiment can swing on a dime, but investors are currently relaxed about all the red ink. The US budget gap has already blown past four percent of GDP. It’s forecast to keep widening at least through 2021. Yet the government can borrow thirty-year money at about three percent. There’s no shortage of people warning about deficit dangers, but the markets aren’t joining in.

No Inflation

The theories leaned on by policymakers since the inflationary 1970s have primarily focused on achieving price stability. But the standard models they use, which view inflation as at least partly a function of the unemployment rate, seem to have broken down. Record-low jobless numbers in the US should be stoking prices, but they aren’t.

As a result, economists have been losing confidence in ideas that 25 years ago seemed obvious. And with a generation having passed since inflation looked like a serious problem, the case for fighting it as public enemy number one has weakened too. That’s opened the door for frameworks geared more toward addressing 21st-century concerns such as rising inequality – more extreme in the US than in any other developed country – or America’s lack of a universal health-care safety net.

The Trump Factor

Politically, the MMTers tend to lean left – but they insist their ideas are applicable by a government of any stripe. And they sometimes express a sneaking admiration for Donald Trump’s approach to fiscal policy, because the president appears to pursue his real-economy goals (lower business taxes, more military spending) and worry about budget outcomes later.

“I don’t think good growth policies have to obsess, necessarily, about the budget deficit”, Trump’s economic adviser Larry Kudlow said on Sunday. That’s pretty much what MMT would advise – even if most of its adherents disagree with Trump’s economic goals and would spend the deficits very differently.

Trump speaks during the State of the Union while Ocasio-Cortez listens. Photographer: Bloomberg; Getty Images

The AOC Factor

It was Senator Bernie Sanders who opened the door for MMT into US politics. He hired Stephanie Kelton, the economist and Bloomberg Opinion columnist who’s become the public face of the doctrine, first at the Senate Budget Committee and then as an adviser during his 2016 tilt at the presidency. Sanders sometimes nodded toward MMT by saying America needs to address real-economy deficits in infrastructure or education as well as financial ones in its budget. But he never endorsed it explicitly.

Freshman Representative Alexandria Ocasio-Cortez (AOC) of New York, who also worked on the Sanders campaign, has done so. She’s said MMT should be “a larger part of our conversation” and urged Congress to use deploy its “power of the purse”. Ocasio-Cortez has millions of followers on social media, where economic and political ideas are spread.

Big in Japan

The country that’s probably come closest to deploying the full MMT toolkit is Japan, where interest rates hit zero twenty years ago and public debt – partly financed by the central bank – is now almost 2.5 times the size of the economy.

Japan isn’t growing quickly, but its image among Western economists as some kind of basket-case has been undergoing a rethink. Serial deficits haven’t triggered inflation or a flight from bond markets. And real incomes have kept pace with America’s (and exceeded Europe’s) since 2008.

Rescue Act

Budget deficits helped Japan and US to recover after the 2008 crisis.

Source: World Bank, Bloomberg data for the period from 2009 to 2017.

The Mainstream Has Moved

Big-name economists from top US universities are lining up to denounce MMT. “Fallacious at multiple levels”, Harvard’s Larry Summers called it. Others to join the attack include Nobel laureate Paul Krugman and Olivier Blanchard, the former chief economist at the International Monetary Fund.

At the same time, it’s become more common to see these same high-profile liberal economists coming out in favor of deficit spending, and dismissing concerns about the national debt as overblown. Summers, Krugman, and Blanchard have all made that case in recent weeks – even while arguing that MMT gets the mechanics wrong.

(Updates with Kudlow on deficits in 11th paragraph.)

Everything You Wanted to Know about Modern Monetary Theory …

… but Were Afraid to Ask

by Kevin Muir, the MacroTourist (January 30 2019)

If you read only one MacroTourist post all year, this is the one I want you to read. I think it’s that important.

Today’s topic is sure to incite some pretty strong reactions. There will be cries of “no! that’s just wrong!” from the hard-money advocates. The cynics will proclaim “that’s going to end in disaster”, and the pessimists will shake their head in disbelief while muttering something about “the follies of the ivory tower academics” as they walk away.

For some of you, the topic of Modern Monetary Theory (MMT) will be old hat. For others, this will be a new term. For those who are not familiar, I suggest you take some time to learn about this new branch of economic thinking as it is coming to a screen near you.

Although I have an opinion about what is best for our economy and society, I am not here to convince you of anything except the fact that MMT is gaining traction and to remind you that spending time arguing about its relative merits/detriments will not help your trading or investing one iota.

You see, I try to be like that joke:



Dear Optimist and Pessimist, while you were busy debating over whether the glass was half-full or half-empty, I drank it.

– The Opportunist


I know I am nowhere near smart enough to influence policy. So why even try? Nor do I have any desire. So why bother debating it? Yet I love trying to figure out this great big game we call investing. In that vein, putting your head in the sand regarding MMT would definitely be a mistake.

Let me take you through my journey of trying to understand MMT, and along the way, I hope to maybe help a little with your navigating the coming changes in economic thinking.

It was about a year ago when MMT started popping up on my radar. Realizing that all I knew was what the acronym stood for (Modern Monetary Theory), I reached out to Bespoke’s George Pearkes who is a wealth of knowledge when it comes to economic thinking. You see, I am basically a markets guy. George is a markets guy, but there is also a big part of him that is a more pure “economist”.

And George was his typical super-nice-guy self. He guided me to some great resources but ultimately pointed me in the direction of the face of MMTProfessor Stephanie Kelton from Stony Brook University.

Last autumn Professor Kelton gave a speech at Stony Brook University titled “But How Will We Pay for It? If you have an hour to spare, this is probably the best introduction to MMT out there.

[As an aside, George and I recently had a chat about MMT on his podcast BespokeCast. Fast-forward to about half-way to get to the MMT stuff.]

Back to my journey of learning about MMT. Apart from being a professor, Stephanie was also the economic advisor for Bernie Sanders’ campaign.

Given the general more right-leaning bias of people in the finance arena, I can already hear the groans and the clicking to the next article. But wait! Before you go and listen to what Alex Jones is screaming about, remember that your job as an investor is not to forecast what should be but rather focus on what will be.

So let’s get to it. What exactly is MMT?

Modern Monetary Theory is a macroeconomic theory that contends that a country that operates with a sovereign currency has a degree of freedom in their fiscal and monetary policy which means government spending is never revenue constrained, but rather only limited by inflation.

This is my layman’s version after reading and listening to everything I could on the subject, but I think I got the gist of it.

MMT’ers believe that government’s red ink is someone else’s black ink. Sure, the government owes dollars, but they have a monopoly of creating those dollars, and not only that, the creation of more and more dollars is essential to the functioning of the economy.

Here are the policy implications of accepting MMT:

* Governments cannot go bankrupt as long as it doesn’t borrow in another currency

* It can issue more dollars through a simple keystroke in the ledger (much like the Federal Reserve (“Fed“) did in the Great Financial Crisis)

* It can always make all payments

* The government can always afford to buy anything for sale

* The government can always afford to get people jobs and pay wages

* The government only faces two different kinds of limitations; political restraint and full employment (which causes inflation)

* The government can keep spending until they begin to crowd out the private sector and compete for resources.

And in fact, Stephanie Kelton argues it is immoral to not utilize this power to fix problems in our society. From an interview she gave,


If you think you can’t repair crumbling infrastructure or feed hungry kids, unless and until you find some money somewhere, it’s actually pretty cruel because you leave people who are struggling in a position where there are still struggling, and they are hurting, and they are not properly taken care of …


I know what you are thinking. Sure sounds like socialism.

But MMT is not socialism. Not by a long shot.

MMT’ers don’t necessarily believe in taxing the wealthy and redistributing it to the poor. Though they do believe the way conventional economics and politicians think about money is wrong.

I know it seems insane to think about the government as not having to worry about deficits and debts. It doesn’t seem to make sense. How can a government just spend money without having to worry about paying it back?

It’s like when Kramer got lost downtown. Remember the terror in his voice when he realized he was at 1st and 1st – where the same street intersects with itself at the nexus of the universe?

But here is another way to think about it. If you have an economy with underused capacity, having the government spend on infrastructure or other societal-useful endeavors is actually raising the total GDP of the country.

Yet isn’t that just Keynes theory? Yeah, trying to wrap my head around the difference between Keynes and MMT took me a while, but I think I got it.

Keynesians are still tied to the idea that we are bound by fiscal constraints whereas MMT’ers believe that the only real restraint is inflation.

I heard an economist the other day on Bloomberg say something about the dire state of the global economy because of the stretched balance sheets of the various sovereigns. He said something to the effect of spending will collapse because “who has the capacity for fiscal spending?”

And this is the conventional thinking that prevails almost everywhere.

But MMT’ers would argue that by not spending now, we will be harming our productive capacity in the future. Ultimately it makes no sense to have economic capacity sitting fallow because of a self-imposed worry about paying back a debt that is denominated in an asset that only the government can create.

But, but, but … won’t that create inflation? Yup! Darn right it will, and that’s the point. MMT’ers believe that inflation is the only true constraint a government faces.

As I was learning about MMT it made me wonder if Richard Koo (balance sheet recession fame) was also an MMT’er. After all his belief in the paradox of thrift causing a self-defeating vicious circle seems straight out of MMT’s theories.

So far I have named all these rather left-wing proponents of MMT, but is it truly the domain of the far left? Well, interestingly, former hedge fund manager Warren Mosler has run for office numerous times as an MMT advocate. I dug up this interesting debate between Warren and this Austrian economist.

And while doing my research, I stumbled on this great interview with Professor Steve Keen titled, “Does Modern Monetary Theory make sense?”

I have greatly simplified MMT – no denying that. There were points when I was reading about the relative slope of the IS curve of Keynesians versus MMT’ers and I had a slight moment of panic that I was back in my third-year Economics class after having missed the past two weeks of classes.

How about I try to explain MMT in contrast to the policies of the past decade?

Let’s step back and think about what’s happened in our economy since the Great Financial Crisis and then think about how MMT changes the equation.

There can be no denying that the grand credit super-cycle has seen more and more debt being piled on to an ever growing mound. In 2007 it looked like we had hit the Minsky moment when no more debt could be balanced on the teetering edifice, and when the final piece of the Jenga puzzle was removed, it started to come tumbling down. At this point, private credit had entered into a deflationary self-reinforcing credit destruction loop which would have resulted in a cleansing reset of the entire system. Yet this would have been extremely painful and it soon became clear that the government didn’t have the stomach to live through this sort of reset. So they flooded the system with money through quantitative easing – much to the howls of protest from the economic and Wall Street elite who insisted this would cause inflation. But much to almost everyone’s surprise, there was almost no inflation – at least little inflation as we generally think about it. There was plenty of financial asset inflation as all that new money pushed down interest rates and caused asset prices to lift, but the average worker saw little benefit from the Fed’s largess. You see, even though the Fed was busy buying everything with a CUSIP, the Federal Government was in the midst of one of the biggest cuts in discretionary spending in the history of the United States.

I try to keep my politics to myself, but I can’t hide my feeling that socialism for the rich is not a fair way to run a society. You can’t have a heads-I-win-tails-you-lose situation for banksters and other well-connected parties, but the moment that the economy starts to gain traction, the Fed needs to tamp down on the brakes for fear of inflation.

Regardless of whether you agree with my view or not, it doesn’t matter.

The public has woken up to the fact that supply-side-trickle-down economics is not helping them anywhere near as much as promised.

You might think these sorts of tax-cutting, pro-business policies are the best thing for our economy. So be it. Reasonable people can have differing opinions. But the tide is shifting away from this belief, so it really doesn’t matter what you, or I, or even the smartest economist in the world believes.

Society’s mood has changed and Stephanie Kelton’s concepts will continue to gain supporters.

If I had told you four years ago that the following picture wasn’t a photoshop, you would have probably told me I was nuts.

Trump was elected due to a profound disappointment with the status quo. It’s easy to forget but even Obama was elected on a platform of hope and change.

Don’t underestimate how pissed off the average American is (and Canadian, Frenchman, Englishman, et al for that matter). Monetary stimulus with fiscal austerity doesn’t do anything except make the rich richer.

MMT is novel, ambitious, and a little bit scary. I get it. But let me let you in on a little bit of a secret – young people aren’t afraid of trying something new. They know the system isn’t working and are desperately looking for an alternative. I think they found it in MMT …

Trading Implications

If I am correct, I suspect we will see many Democrat candidates (perhaps all?) adopt MMT as a tenant of their platform. And here is a crazy thought for you – what if Trump beats them to it?

I have long argued that eventually we will hit a period where governments will spend and Central Banks will facilitate their deficits. MMT provides academic justification of where we all know we are headed anyway.

In one of the interviews I watched with Professor Kelton, she said that the idea of deficits being funded with bond issuance is purely a self-imposed limitation. It’s required by law, but in reality, it doesn’t need to be done. The law can be changed. The government could simply spend $100 while only taking in $90 and directly writing cheques against the Federal Reserve to pay for the $10.

Think about how inflationary this will be! But isn’t that the whole goal?

I have always chuckled at the idea that governments were powerless to create inflation. If they want to create inflation – they can. There just needs to be the political will. And it looks like that will has finally arrived.

So what does this mean for your portfolio?

Although I don’t have any concern about the government funding itself, I do have lots of worries that inflation would quickly rise and before too long, the government would be forced to cut back its spending, and that typical of governments, it would prove much more difficult than instituting spending. Therefore I would expect fixed-income to be a terrible investment under MMT. Even if the government pegs rates low, inflation will be the real risk. It would make little sense to sit in an asset that pays fixed.

To me, MMT would scream that the best course would be to buy real productive assets hand over fist.

Ben Hunt had an interesting piece in his excellent blog Espilon Theory titled, “Modern Monetary Theory or: How I Learned to Stop Worrying and Love the National Debt”. I would argue that he represents conventional Wall Street thinking in terms of his pessimism regarding MMT, but I would like to highlight two terrific points from his writing.

1. Ben believes MMT will gain traction in the coming years: “Like I said, you may not have heard about MMT yet. But you will. You won’t be able to avoid it. Why? Because MMT is the post hoc justification of both easy fiscal policy and easy monetary policy. As such, it is the new intellectual darling of every political and market Missionary of the Left AND the Right.”

2. He also contends that MMT will switch QE’s inflation in financial assets to inflation in the real world.

I agree with Ben that MMT will change the type of inflation the economy experiences. I will leave it to much smarter people than I to decide if this is a good or bad thing.

In the meantime, in the coming months, quarters, and years, watch for MMT to become a much larger source of change for your portfolio and trading. You might think it’s great and that the financial world could use a change. Or you might think it’s terrible and will be a disaster. Doesn’t matter what you or I think. MMT is coming. Ignoring it would be foolish.

I will leave you with two quotes. One from Ben Hunt and one from Stephanie Kelton. They sum up the battle that will soon envelop the political and financial landscape.

Thanks for reading,

Kevin Muir, the MacroTourist

Postscript: Here are some other resources you might find helpful in trying to understand MMT:”>





The Saker Interviews Dmitry Orlov

by The Saker

The Unz Review (April 17 2019)


I think that the American empire is very much over already, but it hasn’t been put to any sort of serious stress test yet, and so nobody realizes that this is the case.


If I had to characterize the current international situation using only one word, the word “chaos” would be a pretty decent choice (albeit not the only one). Chaos in the Ukraine, chaos in Venezuela, chaos everywhere the Empire is involved in any capacity and, of course, chaos inside the US. But you wouldn’t know that listening to the talking heads and other “experts” who serve roughly the same function for the Empire as the orchestra did on the Titanic: to distract from the developing disaster(s) for a long as possible.

I decided to turn to the undisputed expert on social and political collapse, Dmitry Orlov whom I have always admired for his very logical, non-ideological, comparative analyses of the collapse of the USSR and the US. The fact that his detractors have to resort to crude and, frankly, stupid ad hominems further convinces me that Dmitry’s views need to be widely shared. Dmitry very kindly agreed to reply to my questions in some detail, for which I am most grateful. I hope that you will find this interview as interesting as I did.

The Saker

* * * * *

The Saker: How would you assess the current situation in the Ukraine in terms of social, economic, and political collapse?

Dmitry Orlov: The Ukraine has never been viable as an independent, sovereign state and so its ongoing disintegration is to be expected. The applicability of the concept of collapse is predicated on the existence of an intact, stand-alone entity capable of collapse, and with the Ukraine this is definitely not the case. Never in its history has it been able to stand alone as a stable, self-sufficient, sovereign entity. As soon as it gained independence, it just fell over. Just as the Baltics (Estonia, Latvia, Lithuania), it had reached its peak of economic and social development just as the USSR was about to collapse, and it has been degenerating and losing population ever since. Thus, the right model for discussing it is not one of sudden collapse but of steady degeneration and decay.

The Ukraine’s territory was stuck together by the Bolsheviks – first by Lenin, then by Stalin, then by Khrushchev. It was Lenin who lumped in its eastern regions (Donetsk and Lugansk specifically) who previously were part of Russia proper. Stalin then added eastern lands, which were at various times Polish, Austro-Hungarian, or Romanian. Finally, Khrushchev tossed in Russian Crimea in a move that was unconstitutional at the time, since no public referendum had been held in Crimea to decide this question as was required by the Soviet constitution.

Prior to this Bolshevik effort, “Ukraina” was not used as a proper political or geographic designation. The territory was considered part of Russia, distinguished from the rest by a prefix “Malo-” (small) and called “Malorossiya”. The word “ukraina” is simply an archaic form of the Russian word “okraina” (outskirts, border land). This is why the definite article “the” is required: the Ukraine is literally “the outskirts of Russia”. The Soviets endowed this border land with a make-believe identity and forced many of its inhabitants to officially declare their ethnicity as “Ukrainian” in a successful bid to gain an additional seat at the UN.

This political concoction was supposedly held together by a Ukrainian ethnic identity, which is itself a concoction. The Ukrainian language is some combination of southern Russian village dialects with a bit of Polish thrown in as flavoring. It has a lilt to it that Russians find enchanting, making it well suited for folk songs. But it never had much practical merit, and the working language of the Ukrainians was always Russian. Even today Ukrainian nationalists switch to Russian if the subject matter is demanding enough. Religiously, most of the population has been for many centuries and still is Russian Orthodox.

In my conversations about the Ukraine with many Ukrainians over the years I discovered a shocking truth: unlike the Russians, the Ukrainians seem to have exactly zero ethnic solidarity. What binds them together is their commonality of historical experience as part of the Russian Empire, then the USSR, but this historical legacy is being actively erased. After the Soviet collapse and Ukrainian independence there followed a campaign to de-Sovietize and de-Russianize the Ukraine, deprecating this common historical legacy and replacing it with a synthetic Ukrainian identity based on a falsified history that is alien to most of the population. This fake history lionizes Nazi collaborators and attempts to rub out entirely all memory of the Ukraine’s once very active role in the larger Russian world.

Thus we have a mostly Russian-speaking, historically mostly Russian territory where most of the people speak either Russian (some of them with an accent) or a sort of Ukrainian patois called Surzhik, which is Ukrainian-sounding but with mostly Russian words (the overlap between the two languages is so great that it is difficult to draw the line between them). Supposedly proper Ukrainian is spoken in the west of the country, which had never been part of the Russian Empire, but it’s a dialect that is mostly unintelligible in the rest of the country.

In spite of this confused linguistic situation, Ukrainian was imposed as the language of instruction throughout the country. Lack of textbooks in Ukrainian and lack of teachers qualified to teach in Ukrainian caused the quality of public education to plummet, giving rise to several generations of Ukrainians who don’t really know Ukrainian, have had little formal instruction in Russian, and speak a sort of informal half-language. More recently, laws have been passed that severely restrict the use of Russian. For example, people who have never spoken a word of Ukrainian are now forced to use it in order to shop or to obtain government services.

The artificial, synthetic Ukrainian identity is too thin to give the country a sense of self or a sense of direction. It is a purely negative identity: Ukraine is that which is not Russia. The resulting hole in public consciousness was plugged by making a cargo cult of European integration: it was announced that the Ukraine was leaving the Russian world behind and joining the European Union and Nato. Most recently the intent to join the EU and Nato was written directly into the Ukrainian constitution. In the meantime, it has become abundantly clear that neither EU nor Nato membership is the least bit likely, or necessary: the EU got everything it wanted from the Ukraine by forcing it to sign the Association Agreement while giving nothing of value in return; and Ukrainian territory already serves as a playground for Nato training exercises.

Thus, with regard to social collapse, there really isn’t much to discuss, because the term “Ukrainian society” has very little basis in reality. If we drop the conceit that the Ukraine is a country that can be viable if separated from Russia, what can we say about its chances as part of a Greater Russia?

Here I have to digress to explain the difference between a proper empire and the USSR. A proper empire functions as a wealth pump that sucks wealth out of its imperial possessions, be they overseas, as in the case of the British Empire, or part of the periphery, as in the case of the Russian Empire. The latter inherited the traditions of the Mongol Empire that predated it. The Mongol term “tamga” was often used to indicate the annual tribute to be collected from newly conquered tribes as the Russian Empire expanded east. (Many of these tribes were previously Mongol subjects who understood the meaning of the term.)

Here is the key point: the USSR was not a normal empire at all. Instead of functioning as a wealth pump that pumped wealth from the periphery to the imperial center, it functioned as a revolutionary incubator, exploiting the resources of the core (Russia) and exporting them to the periphery to build socialism, with the further goal of fomenting global communist revolution. The various ethnic groups that were grossly overrepresented among the Bolsheviks were all from the periphery – the Jewish Pale, Byelorussia, the Ukraine, the Caucasus, and the Baltics – and they thought nothing of sacrificing Mother Russia on the altar of world revolution.

Their revolutionary zeal was hindered by its utter lack of practical merit. As this came to be recognized, Leon Trotsky – the great exponent of world revolution – was first exiled, then assassinated. Later, when it became clear that without appealing to Russian patriotic sentiments the task of prevailing against Nazi Germany was unlikely to succeed, Stalin brought back the Russian Orthodox Church and made other efforts toward the restoration of Russian ethnic identity that were previously decried as retrograde and chauvinistic. There were significant setbacks to this process as well: in the 1940s a group of communist leaders from Leningrad attempted to promote Russian interests through regional cooperation. They were purged and suffered political repression in what became known as the “Leningrad affair”.

Luckily, the idea of Russia as a disposable staging ground for world communist revolution was never fully implemented. However, the tendency to exploit Russia for the benefit of its Soviet periphery remained intact. The USSR’s most significant leaders – Stalin, Khrushchev, and Brezhnev – were not Russian; Stalin was a Georgian while the latter two were Ukrainian. All the other Soviet republics had their own communist party organizations that developed cadres to send to Moscow, while Russia itself lacked such an organization. The inevitable result was that most of the other Soviet republics were able to suck resources out of Russia, making them far more prosperous than Russia itself.

Thus, the image of the USSR as a typical empire is simply wrong. The right mental image of the USSR is that of a prostrate, emaciated sow (Russia) being suckled by fourteen fat, greedy piglets (the other Soviet Socialist Republics). For all his numerous failings, Boris Yeltsin did one thing right: he dismantled the USSR (although the way he went about it was beyond incompetent and verged on treason).

If you are in need of an explanation for why Russia is now resurgent, increasingly prosperous and able to invest vast sums in hypersonic weapons systems and in modernized infrastructure for its people, this is it: the fourteen piglets had been sent off to root for themselves. This bit of perspective, by the way, puts paid to the rank idiocy of Zbigniew Brzezinski’s Grand Chessboard (1997): his theory that Russia wants to be an empire but cannot do so without the Ukraine shatters on contact with the realization that Russia hasn’t been an empire for over a century now and has no need or desire to become one again.

In any case, these days empires are a bit retro, you know, and not at all useful except as a way for silly Americans to finish bankrupting themselves. Russia needs reliable trading partners who can pay their own way, not ungrateful dependents clamoring for handouts. Just bringing Crimea up to Russia’s contemporary standards after thirty years of Ukrainian neglect has turned out to be a monumental task; as far as doing that for the rest of the Ukraine – forget it!

So, armed with this perspective, what can we say about the Ukraine from the contemporary Russian perspective?

First and foremost, it is a freak show, as attested by the content of Russian talk shows on which Ukrainian experts appear as clownish, indestructible cartoon characters: whenever their risible arguments on behalf of the Ukraine blow up in their faces, for a moment they stand there charred and furious, then brush themselves off and appear in the next segment fresh as daisies. This freak show has certain didactic merit: it helps the Russian body politic develop powerful antibodies against Western hypocrisy because it was Western meddling that has made contemporary Ukraine into the horrible mess it is. But this was, in a sense, inevitable: deprived of the Soviet teat, the Ukraine has been attempting to suckle up to the US and EU for thirty years now and, failing that, has been carving up and roasting its own loins.

Second, the Ukraine is a rich source of immigrants, having lost around a third of its population since independence. Much of its population qualifies as Russian: linguistically, culturally, and religiously they are perfectly compatible with the Russian population. Ukrainians are already the third most populous ethnic group within Russia (after Russians and Tatars) and Russia has been able to absorb the Ukrainians that have been fleeing to Russia in recent years. As the Ukraine’s population dwindles, a natural sorting-out is taking place. Those who are most compatible with the Russian world tend to move to Russia while the rest go to Poland and other EU countries.

Lastly, there is a significant amount of fatigue in Russia with the Ukrainian subject. It is currently a major topic of discussion because of the farcical presidential elections currently taking place there, but more and more one hears the question: “Must we continue talking about this?” There just isn’t anything positive to say about the Ukraine, and people tend to just shake their heads and switch to another channel. Thus, the final element of the Russian perspective on the Ukraine is that it’s painful to look at and they would rather go look at something else.

However, this is not to be. For ample historical reasons, Russia remains the Ukraine’s largest trade partner. Russian and Ukrainian economies were conceived of as a unit, based on the same set of plans, standards, and regulations. In spite of concerted politically motivated efforts by Ukrainian leaders to sever these links, many of them have stubbornly remained in place, for lack of alternatives. Meanwhile, the Ukraine makes very little that the European Union or the rest of the world would want, and very little of it complies with EU’s voluminous standards and regulations. Specifically, the EU has no use at all for Ukrainian manufactured goods, and primarily sees the Ukraine as a source of cheap raw materials and labor.

It is Russia that supplies the nuclear fuel for the Ukraine’s aging nuclear power plants which provide well over half of all the electricity there, while Russian coal (anthracite, specifically) supplies much of the rest. But, for political reasons, Ukrainian officials are loath to admit the fact that the umbilical cord that connects the Ukraine to Russia cannot be severed. For example, they do not buy Russian natural gas directly but through intermediaries in the EU and at a mark-up (part of which they pocket). On paper, the Ukraine imports gas from the EU; physically, the methane molecules piped in from Russia never leave Ukrainian territory; they are simply diverted for local use.

By the time the USSR collapsed, the Ukraine was its most highly developed and possibly its richest part, and some people expected that, having thrown off the Soviet yoke, its future would be too bright to look at without goggles. It had abundant natural resources (fertile land, coal) and an educated labor force. It manufactured numerous high-tech products such as jet aircraft, marine diesels, helicopter engines, rocket engines, and much else that was the best in the world. Instead, what has occurred is several decades of thievery, stagnation, and decay. By now the Ukraine has lost most of its industry and the Soviet-era infrastructure has decayed to the point where much of it is worn out and on the verge of collapse. Industry has shut down and the specialists it once employed have either retired or have gone off to work in Russia, in the EU, or in the US. (Some Ukrainian rocket scientists have apparently gone off to work in North Korea, and this explains the DPRK’s recent stunning successes in rocketry as well as its unlikely, exotic choice of rocket fuel: unsymmetrical dimethylhydrazine.)

The Saker: What about the Donbas republics? How would you compare the situation in Novorussia with what is taking place in the Ukraine?

Dmitry Orlov: The term “Novorossiya” (New Russia) goes back several centuries, to the time Catherine the Great expanded the Russian Empire to include Crimea and other southern possessions. What Lenin reassigned to the Ukrainian Soviet Socialist Republic were Russian lands, Donetsk and Lugansk regions among them.

There are several other Ukrainian regions that are almost entirely Russian – Kharkov and Odessa specifically – but Donetsk and Lugansk are not Ukrainian in the least. This is why, after the government overthrow of 2014, when it became clear that the intentions of the Ukrainian nationalists who seized power in Kiev were to oppress the Russian part of the population, these two regions decided to strike out on their own. The Ukrainian nationalists reacted by launching a civil war, which started exactly five years ago, and which they have lost. To save face, they have declared their defeat the result of a “Russian invasion” but have been unable to present any evidence of it. Had the Russians invaded, the result would have been a replay of Russia’s action in Georgia in August of 2008, which lasted about a week.

The Ukrainians are continuing to lob missiles into the territories of Donetsk and Lugansk, causing sporadic civilian casualties. Once in a while they stage minor skirmishes, suffer casualties and pull back. But mostly their “Anti-Terrorist Operation”, which is what they are calling this civil war, has turned into a propaganda initiative, with the mythical “Russian invaders” invoked at every turn to explain their otherwise inexplicable string of defeats.

After some amount of effort by Nato instructors to train the Ukrainians, the instructors gave up. The Ukrainians simply laughed in their faces because it was clear to them that the instructors did not know how to fight at all. It was then decided that the “road map” for Ukraine’s inclusion in Nato should be set aside because the Ukrainians are just too crazy for sedate and sedentary Nato. The trainers were then replaced with CIA types who simply collected intelligence on how to fight a high-intensity ground war without air support – something that no Nato force would ever consider doing. Under such conditions, Nato forces would automatically retreat or, failing that, surrender.

Meanwhile, the two eastern regions, which are highly developed economically and have a lot of industry, have been integrating ever more closely into the Russian economy. Their universities and institutes are now fully accredited within the Russian system of higher education, their currency is the ruble, and although in terms of international recognition they remain part of the Ukraine, it is very important to note that the Ukraine does not treat them as such.

The Ukrainian government does not treat the citizens of Donetsk and Lugansk as its citizens: it does not pay their pensions, it does not recognize their right to vote, and it does not provide them with passports. It lays claim to the territory of Donetsk and Lugansk but not to the people who reside there. Now, genocide and ethnic cleansing are generally frowned upon by the international community, but an exception is being made in this case because of Russophobia: the Russian people living in Donetsk and Lugansk have been labeled as “pro-Russian” and are therefore legitimate targets.

Russia has been resisting calls to grant official recognition to these two People’s Republics or to provide overt military support (weapons and volunteers do filter through from the Russian side without any hindrance, although the flow of volunteers has been slowing down of late). From a purely cynical perspective, this little war is useful for Russia. If in the future the Ukraine fails completely and fractures into pieces, as appears likely, and if some of these pieces (which might theoretically include not just Donetsk and Lugansk regions but also Kharkov, Odessa, and Dnepropetrovsk) clamor to join Russia, then Russia would face a serious problem.

You see, over the past thirty years, most Ukrainians have been content to sit around drinking beer and watching television as their country got looted. They saw no problem with going out to demonstrate and protest provided they were paid to do it. They voted the way they were paid to vote. They didn’t take an issue with Ukrainian industry shutting down as long as they could work abroad and send money back. They aren’t enraged or even embarrassed by the fact that their country is pretty much run from the US embassy in Kiev. About the only ones with any passion among them are the Nazis who march around with torches and sport Nazi insignia. In short, these aren’t the sort of people that any self-respecting country would want to have anything to do with, never mind absorb them into its population en masse, because the effect would be to demoralize its entire population.

But the people of Donetsk and Lugansk are not like that at all. These coal miners, factory workers, and cab drivers have been spending days and nights in the trenches for years now, holding back one of Europe’s larger militaries, and fighting for every square meter of their soil. If the Ukraine is ever to be reborn as something that Russia would find acceptable, it is these people who can provide the starter culture. They have to win, and they have to win without any help from the Russian military, which can squash the Ukrainian military like a bug, but what would be the point of doing that? Thus, Russia provides humanitarian aid, business opportunities, some weapons, and some volunteers, and bides its time, because creating a viable new Ukraine out of a defunct one is a process that will take considerable time.

The Saker: What is your take on the first round of Presidential elections in the Ukraine?

Dmitry Orlov: The first round of the elections was an outright fraud. The object of the exercise was to somehow allow president Poroshenko to make it into the second round. This was done by falsifying as many votes as was necessary. In a significant number of precincts, the turnout was exactly 100% instead of the usual sixty percent or so and counted votes from people who had moved, died or emigrated. All of these fake votes went to Poroshenko, allowing him to slither through to the second round.

Now the fight is between Poroshenko and a comedian named Vladimir Zelensky. The only difference between Poroshenko and Zelensky, or any of the other thirty-plus people who appeared on the ballot, is that Poroshenko has already stolen his billions while his contestants have not had a chance to do so yet, the only reason to run for president, or any elected office, in the Ukraine, is to put oneself in a position to do some major thieving.

Thus, there is an objective reason to prefer Zelensky over Poroshenko, which is that Poroshenko is a major thief while Zelensky isn’t one yet, but it must be understood that this difference will begin to equalize the moment after Zelensky’s inauguration. In fact, the elites in Kiev are currently all aquiver over their ingenious plan to sell off all of Ukraine’s land to foreign investors (no doubt pocketing a hefty “fee”).

The platforms of all the thirty plus candidates were identical, but this makes no difference in a country that has surrendered its sovereignty. In terms of foreign relations and strategic considerations, the Ukraine is run from the US embassy in Kiev. In terms of its internal functioning, the main prerogative of everyone in power, the president included, is thievery. Their idea is to get their cut and flee the country before the whole thing blows up.

It remains to be seen whether the second round of elections will also be an outright fraud and what happens as a result. There are many alternatives, but none of them resemble any sort of exercise in democracy. To be sure, what is meant by “democracy” in this case is simply the ability to execute orders issued from Washington; inability to do so would make Ukraine an “authoritarian regime” or a “dictatorship” and subject to “regime change”. But short of that, nothing matters.

The machinations of Ukraine’s “democrats” are about as interesting to me as the sex lives of sewer rats, but for the sake of completeness, let me flowchart it out for you. Poroshenko got into the second round by outright fraud, because the loss of this election would, within the Ukrainian political food chain, instantly convert him from predator to prey. However, he was none too subtle about it, there is ample proof of his cheating, and the contender he squeezed out – Yulia Timoshenko – could theoretically contest the result in court and win. This would invalidate the entire election and leave Poroshenko in charge until the next one. Lather, rinse, repeat.

Another option would be for Poroshenko to cheat his way past the second round (in an even more heavy-handed manner, since this time he is behind by over thirty percent), in which case Zelensky could theoretically contest the result in court and win. This would invalidate the entire election and leave Poroshenko in charge until the next one. Lather, rinse, repeat. Are you excited yet?

None of this matters, because we don’t know which of the two is the US State Department’s pick. Depending on which one it is, and regardless of the results of any elections or lawsuits, a giant foot will come out of the sky and stomp on the head of the other one. Of course, it will all be made to look highly democratic for the sake of appearances. The leadership of the EU will oblige with some golf claps while choking back vomit and the world will move on.

The Saker: Where is, in your opinion, the Ukraine heading? What is your best “guesstimate” of what will happen in the short-to-medium term future?

Dmitry Orlov: I believe that we will be subjected to more of the same, although some things can’t go on forever, and therefore won’t. Most worryingly, the Soviet-era nuclear power plants that currently provide most of the electricity in the Ukraine are nearing the end of their service life and there is no money to replace them. Therefore, we should expect most of the country to go dark over time. Likewise, the natural gas pipeline that currently supplies Russian gas to both the Ukraine and much of the EU is worn out and ready to be decommissioned, while new pipelines being laid across the Baltic and the Black Sea are about to replace it. After that point, the Ukraine will lose access to Russian natural gas as well.

If the Ukrainians continue to surrender unconditionally while placating themselves with pipe dreams of EU/Nato membership, the country will depopulate, the land will be sold off to Western agribusiness, and it will become a sort of agricultural no man’s land guarded by Nato troops. But that sort of smooth transition may be hard for the EU and the Americans to orchestrate. The Ukraine is rather highly militarized, is awash with weapons, full of people who have been circulated through the frontlines in Donbas and know how to fight, and they may decide to put up a fight at some point. It must be remembered that the Ukrainians, in spite of the decay of the last thirty years, still have something of the Russian fighting spirit in them, and will fight like Russians – until victory or until death. Nato’s gender-ambivalent military technicians would not want to get in their way at all.

Also, the dream of a depopulated Ukraine to be turned into a playground for Western agribusiness may be hindered somewhat by the fact that the Russians take a very dim view of Western GMOs and wouldn’t like to see GMO-contaminated pollen blowing across their border from the West. They would no doubt find some least-effort way to make the attempt at Western agribusiness in the Ukraine unprofitable. Orchestrating a smallish but highly publicized radiation leak from one of the ancient Ukrainian nuke plants would probably work. Rather weirdly, Westerners think nothing of poisoning themselves with glyphosphate but are deathly afraid of even a little bit of ionizing radiation.

The Saker: What about the EU and the Parliamentary Assembly of the Council of Europe? Where is the EU heading in your opinion?

Dmitry Orlov: The EU has a number of major problems. It isn’t fiscally or monetarily healthy. As a whole, or as its constituent nations, it is no longer capable of the exercise of its full sovereignty, having surrendered it to the US. But the US is no longer able to maintain control, because it is internally conflicted to the point of becoming incoherent in its pronouncements. Overall, the structure looks like a matryoshka doll. You have the US, as a sort of cracked outer shell. Inside of it is Nato, which is an occupying force across most of Europe right up to the Russian border. It would be useless against Russia, but it can pose a credible threat of violence against the occupied populations. Inside of Nato is the EU – a political talking shop plus a sprawling bureaucracy that spews forth reams upon reams of rules and regulations.

Since none of this military/political superstructure is actually structural without the key ingredient of US hegemony, we shouldn’t expect it to perform particularly well. It will continue as a talking shop while various national governments attempt to reclaim their sovereignty. British referendum voters have certainly tried to prod their government in that direction, and in response, their government has been experimenting with various methods of rolling over and playing dead, but a different government might actually try to execute the will of the people. On the other hand, the governments of Hungary and Italy have made some headway in the direction of reasserting their sovereignty, with public support.

But nothing has really happened yet. Once the political elite of any nation has been thoroughly emasculated by the surrender of its national sovereignty, it takes a while for it to grow back its chest hair and to start posing a credible threat to transnational interests. Even in Russia, it took close to a decade to thwart the political power and influence of the oligarchy. We can see that the empire is weakening and that some countries are starting to balk at being vassals, but nothing definitive has happened yet.

What may speed things up is that Europe, along with the US, appears to be heading into a recession/depression. One effect of that will be that all the East European guest workers working in the west will be forced to head back home. Another will be that EU’s subsidies to its recent eastern acquisitions – Poland and the Baltics especially – are likely to be reduced substantially or to go away altogether. The influx of returning economic migrants combined with the lack of financial support is likely to spell the demise of certain national elites which have been feasting on Western largesse in return for a bit of Russophobia.

We can imagine that this swirling tide of humanity, ejected from Western Europe, will head east, slosh against the Great Wall of Russia, and flood back into the west, but now armed with Ukrainian weapons and knowhow and entertaining thoughts of plunder rather than employment. There they will fight it out with newcomers from the Middle East and Africa while the natives take to their beds, hope for the best, and think good thoughts about gender neutrality and other such worthy causes.

These old European nations are all aging out, not just in terms of demographics but in terms of the maximum age allotted by nature to any given ethnos. Ethnoi (plural of “ethnos”) generally only last about a thousand years, and at the end of their lifecycle they tend to exhibit certain telltale trends: they stop breeding well and they become sexually depraved and generally decadent in their tastes. These trends are on full display already. Here’s a particularly absurd example: French birth certificates no longer contain entries for father and mother but for parent1 and parent2. Perhaps the invading barbarians will see this and die laughing; but what if they don’t?

No longer able to put up much of a fight, such depleted ethnoi tend to be easily overrun by barbarians, at which point they beg for mercy. In turn, based on the example of the late Roman Empire as well as similar ones from Chinese and Persian history, granting them mercy is one of the worst mistakes a barbarian can make: the result is a bunch of sexually depraved and generally decadent barbarians … to be easily overrun and slaughtered by the next bunch of barbarians to happen along.

What will spark the next round of Western European ethnogenesis is impossible to predict, but we can be sure that at some point a mutant strain of zealots will arrive on the scene, with a dampened instinct for self-preservation but an unslakable thirst for mayhem, glory, and death, and then it will be off to the races again.

The Saker: What will happen once Nord Stream II is finished? Where is Europe heading next, especially in its relationship with the US and Russia?

Dmitry Orlov: The new pipelines under the Baltic and the Black Sea will be completed, along with the second LNG installation at Sabetta, and Russia will go on supplying natural gas to Europe and Asia. I suspect that the fracking extravaganza in the US is entering its end game and that the dream of large-scale LNG exports to Europe will never materialize.

The nations of Europe will gradually realize that its relationship with Russia is mostly beneficial while its relationship with the US is mostly harmful, and will make certain adjustments. The Ukraine, its natural gas pipeline system decrepit and beyond repair, will continue to import natural gas from Europe, only now the methane molecules will actually flow to it from the west rather from the east.

The Saker: How do you see the political climate in Russia? I hear very often that while Putin personally and the Kremlin’s foreign policy enjoy a great deal of support, the pension reform really hurt Putin and that there is now an internal “patriotic opposition” (as opposed to paid and purchased for by the CIA & Company. which is becoming more vocal. Is that true?

Dmitry Orlov: It is true that there isn’t much debate within Russia about foreign policy. Putin’s popularity has waned somewhat, although he is still far more popular than any national leader in the West. The pension reform did hurt him somewhat, but he recovered by pushing through a raft of measures designed to ease the transition. In particular, all the benefits currently enjoyed by retirees, such as reduced public transit fees and reduced property taxes, will be extended to those nearing retirement age.

It is becoming clear that Putin, although he is still very active in both domestic and international politics, is coasting toward retirement. His major thrust in domestic politics seems to be in maintaining very strict discipline within the government in pushing through his list of priorities. How he intends to effect the transition to the post-Putin era remains a mystery, but what recently took place in Kazakhstan may offer some clues. If so, we should expect a strong emphasis on continuity, with Putin maintaining some measure of control over national politics as a senior statesman.

But by far the most significant change in Russian politics is that a new generation of regional leaders has been put into place. A great many governorships have been granted to ambitious young managers with potential for national office. They are of a new breed of thoroughly professional career politicians with up-to-date managerial skills. Meanwhile, a thorough cleaning out of the ranks has taken place, with some high-ranking officials doing jail time for corruption. What’s particularly notable is that some of these new regional leaders are now as popular or more popular than Putin. The curse of gerontocracy, which doomed the Soviet experiment, and which now afflicts the establishment in the US, no longer threatens Russia.

The Saker: You recently wrote an article titled “Is the USS Ship of Fools Taking on Water?” in which you discuss the high level of stupidity in modern US politics? I have a simple question for you: do you think the Empire can survive Trump and, if so, for how long?

Dmitry Orlov: I think that the American empire is very much over already, but it hasn’t been put to any sort of serious stress test yet, and so nobody realizes that this is the case. Some event will come along which will leave the power center utterly humiliated and unable to countenance this humiliation and make adjustments. Things will go downhill from there as everyone in government in media does their best to pretend that the problem doesn’t exist. My hope is that the US military personnel currently scattered throughout the planet will not be simply abandoned once the money runs out, but I wouldn’t be too surprised if that is what happens.

The Saker: Lastly, a similar but fundamentally different question: can the US (as opposed to the Empire) survive Trump and, if so, how? Will there be a civil war? A military coup? Insurrection? Strikes? A US version of the Yellow Vests?

Dmitry Orlov: The US, as some set of institutions that serves the interests of some dwindling number of people, is likely to continue functioning for quite some time. The question is: who is going to be included and who isn’t? There is little doubt that retirees, as a category, have nothing to look forward to from the US: their retirements, whether public or private, have already been spent. There is little doubt that young people, who have already been bled dry by poor job prospects and ridiculous student loans, have nothing to look forward to either.

But, as I’ve said before, the US isn’t so much a country as a country club. Membership has its privileges, and members don’t care at all what life is like for those who are in the country but aren’t members of the club. The recent initiatives to let everyone in and to let non-citizens vote amply demonstrates that US citizenship, by itself, counts for absolutely nothing. The only birthright of a US citizen is to live as a bum on the street, surrounded by other bums, many of them foreigners from what Trump has termed “shithole countries”.

It will be interesting to see how public and government workers, as a group, react to the realization that the retirements they have been promised no longer exist; perhaps that will tip the entire system into a defunct state. And once the fracking bubble is over and another third of the population finds that it can no longer afford to drive, that might force through some sort of reset as well. But then the entire system of militarized police is designed to crush any sort of rebellion, and most people know that. Given the choice between certain death and just sitting on the sidewalk doing drugs, most people will choose the latter.

And so, Trump or no Trump, we are going to have more of the same: shiny young IT specialists skipping and whistling on the way to work past piles of human near-corpses and their excrement; Botoxed housewives shopping for fake organic produce while hungry people in the back of the store are digging around in dumpsters; concerned citizens demanding that migrants be allowed in, then calling the cops as soon as these migrants set up tents on their front lawn or ring their doorbell and ask to use the bathroom; well-to-do older couples dreaming of bugging out to some tropical gringo compound in a mangrove swamp where they would be chopped up with machetes and fed to the fish; and all of them believing that things are great because the stock market is doing so well.

At this rate, when the end of the US finally arrives, most of the people won’t be in a position to notice while the rest won’t be capable of absorbing that sort of upsetting information and will choose to ignore it. Everybody wants to know how the story ends, but that sort of information probably isn’t good for anyone’s sanity. The mental climate in the US is already sick enough; why should we want to make it even sicker?

The Saker: Dmitry, thank you so much for your time and for a most interesting interview!

China’s Belt and Road Continues to Win Over Europe …

… While Technocrats Scream and Howl

by Matthew Ehret (April 20 2019)

On April 10th, China’s Premier Li Keqiang celebrated the completion of the 1st phase of the 2.5-kilometer Chinese-built Pelgesac Bridge in Croatia across the Bay of Mali Ston alongside Croatian Prime Minister Andrej Plenkovic. This ceremony marked a striking victory as the following day ushered in an important 16+1 Heads of State summit that saw Greece inducted as the newest member of a new alliance of Central and Eastern European nations who wish to cooperate with China. At this summit held on April 12, Greece’s Prime Minister Alexis Tsipras stated that this was “a very crucial moment for global and regional developments” and “we have to leave behind the crisis and find new models of regional and global cooperation”.

Of course, Greece’s involvement in this alliance (now renamed the 17+1 CEEC) has broadened its geographical boundaries to the west and is especially important as Greece’s Port of Piraeus is a strategic east-west trade gateway for the Belt and Road Initiative (BRI) into Europe centered on the China-Europe Land-Sea Express Route. Greece is painfully aware that its survival depends upon China’s BRI, as the EU programs for austerity, privatization, and bailouts have brought only death and despair with a collapse of youth employment, crime rate spikes, and suicide. It is also not lost on anyone that this breakthrough follows hot on the heels of Italy’s joining of the Belt and Road Initiative on March 26 and also serves as a precursor to the second Belt and Road Summit which will take place in Beijing at the end of April, involving over 126 nations who have already signed Memorandums of Understandings (MOUs) with the BRI and thousands of international businesses.

Ten additional BRI-connected agreements were signed between Croatia and China before the 17+1 Summit including the modernizing of rail lines (especially from Zagreb to the Adriatic port of Rijeka), telecommunications cooperation between Huawei and Croatian Telecom and major port, roads, harbors, education, and cultural cooperation.

The Belt and Road Initiative, as Tsipras aptly pointed out, is not just another set of infrastructure programs designed to counterbalance western hegemony, but is rather a “new model of regional and global cooperation” founded upon a principle of mutual development and long-term thinking not seen in the west since the death of Franklin Roosevelt and the takeover of the Anglo-American Deep State that ensued.

The fact that China formalized an economic and trade cooperation agreement with the Russian-led Eurasian Economic Union (EEU) in May 2018 is extremely relevant as it incorporated its five-nation membership of Russia, Belarus, Kazakhstan, Armenia, and Kyrgyzstan directly into the BRI. Already China has invested $98 billion into the real economies of the EEU involving 168 BRI-connected projects.

The new model of development which has increasingly won over central, and eastern Eurasian countries as well as Greece and Italy have provided a breath of fresh air for citizens everywhere who are looking with despair upon a Trans-Atlantic system which can do nothing but demand obedience to a defunct set of rules that commands only austerity, hyperinflationary banking practices, and no long term investment into the real economy. Thus the technocratic mobilization against the BRI over the past days in response to this new paradigm can only be seen as an absurd attempt to save a system which has already failed.

The Technocrats Defend their New World Disorder

Two recent counter-operations against the BRI and the new win-win operating system it represents are worth mentioning. The first is found in the formation of a trilateral alliance between the American-based Overseas Private Investment Corporation (OPIC), Canada’s Finance and Development Agency (FinDev Canada) and fifteen members of the European Union announced on April 11. A second counter-operation was created several days earlier with the Canada-Germany-France-Japan “Alliance for Multilateralism” during the G7 meeting in France.

OPIC Acting President and CEO David Bohigian (Center) signed a memorandum of understanding with FinDev Canada Managing Director Paul Lamontagne (right) and EDFI Chairman Nanno Kleiterp (left).

While OPIC was founded in 1971, its use as a subversive force against the BRI was formalized on July 30 2018 when it created a trilateral alliance with Japan and Australia in order to finance infrastructure in the Pacific basin. Added to this, a second trilateral alliance was created on April 11 2019 when Canada’s Paul Lamontagne (head of FinDev Canada), the European Development Finance Institution’s Nanno Kleiterp, and OPIC President David Bohigian signed a new agreement to create a parallel infrastructure financing mechanism. Taking aim at China, the press release stated that the alliance “will enhance transactional, operational, and policy-related cooperation among participants and underscores their commitment to providing a robust alternative to unsustainable state-led models.”

At this signing, Bohigian stated “we’re trying to hold up an example for the world of the way development finance should work” clearly attacking China’s “incompetent” concept of development finance and thus ignoring the fact that over 800 million people have directly been lifted out of poverty by China’s approach to investment. Bohigian was clearly hoping that the world would ignore the vast debt-slavery and chaos spread by fifty years of IMF-World Bank dominance that has produced no real growth of nations. Although the American BUILD Act has increased US government funding to OPIC from $29 billion to $60 billion over one year, no serious integrated design for development has been presented and instead provides fodder for laughter at best.

The other anti-BRI operation mentioned is the German-French-Japanese-Canadian “Alliance for Multilateralism” which saw Canada’s Foreign Minister Chrystia Freeland stating at a press conference in France that “Canada has formally joined a German-French coalition armed at saving the international world order from destruction by various world dictators and autocrats”. While Freeland didn’t mention Trump by name here, France’s ambassador to Canada Kareen Rispal was more candid stating “Mr Trump doesn’t like to value multilateralism”. Citing his withdrawal from COP21, and criticism of the WTO, UN, and NATO the envoy continued “it sends the wrong message to the world if we think that because Mr Trump is not in favor of multilateralism, it doesn’t mean we – I mean countries like Canada, France, and Germany and many others – are not still firm believers”.

What exactly this “Alliance for Multilateralism” IS remains another question entirely, as no actual policy was put forth. After the smoke had cleared, it appears to be nothing more than a lemming-like club of hecklers yelling at Putin, Xi Jinping, Trump, and other “bad people” who don’t wish to commit mass suicide under a Green New Deal and technocratic dictatorship.

Commenting on these developments in an April 10 webcast from Germany, Schiller Institute President Helga Zepp-Larouche made the following apt observation:



Geopolitics has to be thrown out of the window, and the New Silk Road is the way to industrialize Africa, to deal with the Middle East situation to get peace there, to establish a decent working situation between the United States, Russia, and China: And that is for Europe what we should demand. And the best way to do that is that all of Europe would sign MOUs with the Belt and Road Initiative, then that would be the single most important thing to stabilize world peace and get the world into a different domain.



With Russia and China leading a new coalition of nations fighting to uphold the principles of sovereignty, self-development, and long term credit generation under the framework of the Belt and Road Initiative, a great hope has presented itself as the Titanic that is the City of London and Wall Street continues to sink ever faster into the icy waters of history.

Is this the End of the American Century?

by Adam Tooze

London Review of Books (Vol 41 No 7, April 04 2019)

On 13 October 1806 a young German philosopher, Georg Wilhelm Friedrich Hegel, had an encounter with world history. En route to their annihilation of the Prussian forces 24 hours later, Napoleon and his army were marching through the East German university town of Jena. Hegel couldn’t disguise his terror that in the ensuing chaos the recently completed manuscript of The Phenomenology of Spirit (1807) might get lost in the mail. But neither could he resist the drama of the moment. As he wrote to his friend Friedrich Niethammer,


I saw the emperor – this world-soul (Weltseele) – riding out of the city on reconnaissance. It is indeed a wonderful sensation to see such an individual, who, concentrated here at a single point, astride a horse, reaches out over the world and masters it.


Two hundred years later, in rather more sedate circumstances, the Berkeley historian Daniel J Sargent, addressing the American Historical Association, also evoked the world spirit. But this time it came in the person of Donald Trump and he was riding not on horseback, but on a golf cart. Trump can be compared to Napoleon, according to Sargent, because they are both destroyers of international order. In the wake of the French Revolution, Napoleon wrecked what was left of the legitimate order of Europe. Trump, in turn, has apparently ended the American world order, or, as Sargent prefers to call it, Pax Americana.

Sargent’s is an extraordinary suggestion, even though overenthusiastic historic comparisons have now become commonplace. Early in 2017, I was among those who thought they were seeing the end of the American century. But, even then, in the early days of the Trump administration, it seemed crucial to draw a distinction between American power and American political authority. Two years on, that distinction seems more important than ever.

The idea that Trump is a wrecker of the American-led world order rests on three claims. First, he is manifestly unfit for high office. That such a man can be elected president of the United States reveals a deep degeneration of American political culture and permanently damages the country’s credibility. Second, his capricious and crude pursuit of “America first” has weakened America’s alliances and instigated a departure from globalisation based on free trade. Finally, he has triggered this crisis at a moment when China poses an unprecedented challenge to Western-led globalisation. Each of these claims is hard to deny, but do they, in fact, add up to a historically significant shift in the foundations of America’s global power?

No question, Trump has done massive damage to the dignity of the American presidency. Even allowing for the personal and political failings of some previous incumbents, he marks a new low. What ought to be of no less concern is that he has received so little open criticism from the supposedly respectable ranks of the Republican leadership. Similarly, American big business leaders, though sceptical of Trump, have profited from his administration’s tax cuts and eagerly assisted in dismantling the apparatus of environmental and financial regulation. He has been applauded by the section of the US media that caters to the right. And a solid minority of the electorate continues to give him its wholehearted support. What is worrying, therefore, isn’t simply Trump himself, but the forces in America that enable him.

Of course, Trump isn’t the first Republican president to evoke a mixture of outrage, horror, and derision both at home and abroad. Both Ronald Reagan and George W Bush were accused, in their time, of endangering the legitimacy of the American world order. The cultural conservatism and overt nationalism of the American right is fiercely at odds with bien-pensant global opinion. This culture clash has historical roots in America’s domestic struggles over civil rights, the women’s and gay liberation struggles, and in the worldwide protest movement against America’s brutal war in Vietnam. b By the 1980s the Republican Party was an uneasy coalition between a free-market, pro-business elite and a xenophobic working and lower-middle-class base. This was always a fragile arrangement, held together by rampant nationalism and a suspicion of big government. It was able to govern in large part owing to the willingness of Democratic Party centrists to help with the heavy lifting. The Nafta free-trade agreement between the US, Mexico, and Canada was initiated by George H W Bush, but carried over the line in 1993 by Bill Clinton, against the opposition of the American labour movement. It was Clinton’s administration that righted the fiscal ship after the deficit excesses of the Reagan era, only for the budget to be blown back into deficit by the wars and tax cuts of the George W Bush administration.

Meanwhile, the broad church of the Republican Party began to radicalise. In the 1990s, with Newt Gingrich and Karl Rove setting the tone, the battle lines hardened. With the Iraq War going horribly, and the Democrats taking control of Congress in 2006, the right became ever more dominant within the Republican Party. In 2008, in the midst of the financial crisis, the Republicans in Congress abandoned the Bush administration. The financial crisis-fighting of Hank Paulson as Bush’s Treasury secretary and Ben Bernanke at the Fed relied on the Democrats for congressional support. Elite leadership of the Republican Party collapsed. John McCain chose the shockingly unqualified Sarah Palin as a running mate in the 2008 election because she was hugely popular with the Republican base, who revelled in the outrage she triggered among liberals. Barack Obama’s victory in that election only exacerbated the lurch to the right. The Republicans in Congress put up a wall of opposition and indulged the populist right in openly questioning his legitimacy as president. The defeat of the centrist Mitt Romney in 2012 caused a further, decisive slide to the right, opening the door for Trump. In 2016 no major corporation was willing to sponsor the convention that nominated Trump as the Republican presidential candidate: their brand advisers were too worried that Confederate flags would be waving in the convention hall. His is the voice of the right-wing base, energised by funding from a small group of highly ideological oligarchs, no longer constrained by the globalist business elite.

A cynic might say that Trump simply says out loud what many on the right have long thought in private. He is clearly a racist, but the mass incarceration of black men since the 1970s has been a bipartisan policy. His inflammatory remarks about immigration are appalling, but it isn’t as though liberal centrists would advocate a policy of open borders. The question – and it is a real question – is whether his disinhibited rhetoric announces a disastrous slide from the hypocrisies and compromises of the previous status quo into something even darker. The concern is that he will trigger an illiberal chain reaction both at home and abroad.

At G20, G7, and Nato summits, the mood is tense. The rumour that the US is planning to charge host governments “cost plus fifty percent” for the military bases it has planted all over the world is the latest instance of a stance that at times seems to reduce American power to a protection racket. But for all the indignation this causes, what matters is the effect Trump’s disruptive political style has on the global power balance and whether it indicates a historic rupture of the American world order. How much difference does the US being rude to European Nato members, refusing to co-operate with the WTO, or playing hardball on car imports really make?

This is not merely a debating point. It is the challenge being advanced by the Trump administration itself in its encounters with its allies and partners. Do America’s alliances – do international institutions – really matter? The administration is even testing the proposition that transnational technological and business linkages must be taken as given. Might it not be better for the US simply to “uncouple”? Where Trump’s critics argue that at a time when China’s power is increasing the US should strengthen its alliances abroad, the Trumpists take the opposite view. For them, it is precisely in order to face down China that the US must shake up the Western alliance and redefine its terms so that it serves American interests more clearly. What we are witnessing isn’t just a process of dismantling and destruction, but a deliberate strategy of stress testing. It is a strategy Trump personifies, but it goes well beyond him.

In October 2018 the giant Nimitz-class aircraft carrier USS Harry S Truman unexpectedly pulled out of the Eastern Mediterranean, where its planes had been bombarding IS’s positions in Syria. It sailed into the Atlantic and then suddenly and without warning headed north. Aircraft carriers don’t do this: their itineraries are planned years ahead. This was different. The Truman and its escorts headed full steam to the Arctic, making it the first carrier group to deploy there for 27 years, backing up Nato’s war games in Norway. The consternation this caused delighted the Pentagon. Unpredictable “dynamic force employment” is a key part of its new strategy to wrong-foot America’s challengers.

The Harry S Truman is a controversial ship. The Pentagon would like to scrap it in favour of more modern vessels. Congress is pushing back. The White House wants more and bigger carrier groups; the Navy says it wants twelve of them. The Nimitz-class behemoths commissioned between 1975 and 2009 are to be replaced by a new fleet of even more gigantic and complex Ford-class vessels. All have their priorities, but what everyone in Washington agrees on is the need for a huge military build-up.

* * * * *

The resignation of General James Mattis as defence secretary at the end of 2018 sparked yet another round of speculation about the politicking going on inside the Trump administration. But we would do better to pay more attention to his interim replacement, Patrick Shanahan, and the agenda he is pursuing. Shanahan, who spent thirty years at Boeing, is described by one insider as “a living, breathing product of the military-industrial complex”. Under Mattis, he was the organisational muscle in a Defence Department with a new focus, not on counterinsurgency, but on future conflicts between great powers. Shanahan’s stock in trade is advanced technology: hypersonics, directed energy, space, cyber, quantum science, and autonomous war-fighting by AI. And he has the budget to deliver. The Trump administration has asked for a staggering $750 billion for defence in 2020, more than the spending of the next seven countries in the world put together.

Declinists will point out that the US no longer has a monopoly on high-tech weaponry. But that is grist to the mill of the Trump-era strategists. They recognise the threat that great-power competition poses. Their plan is to compete and to win. In any case, most of the other substantial military spenders are American allies or protectorates, like Saudi Arabia or the European members of Nato. The only real challenges are presented by Russia and China. Russia is troublesome and the breakdown in nuclear arms control poses important and expensive questions for the future. But Russia is the old enemy. Shanahan’s mantra is “China, China, China”.

The “pivot” in American strategy to face China was initiated not by Trump but by Obama in 2011, under Secretary of State Hillary Clinton. Even then, despite their far more tactful leadership, it caused some crashing of gears. The problem is that containing China is not what Washington’s system of alliances is designed to do. From the early 1970s, the days of Nixon and Kissinger, China was enrolled as a US partner in keeping the balance of power with the Soviet Union. Given half a chance, Trump would like to essay a reverse-Kissinger and recruit Russia as an ally against China. But Congress and the defence community will have none of that. Instead, the US is doubling down on its Cold War alliances in urging both South Korea and Japan to increase their defence efforts. This has the additional benefit that they will have to buy more American equipment. If the Vietnamese regime too were to veer America’s way, Washington would surely welcome it with open arms.

None of this is to say that Trump’s version of the pivot is coherent. If containment of China is the aim, America’s Asian partners must wonder why the president scrapped the Trans-Pacific Partnership trade and investment deal within days of taking office. That elaborate package was the foundation of Obama’s China-containment strategy. But for Trump and his cohorts that is muddled thinking. You cannot build American strength on the back of a giant trade deficit. Washington is no longer willing to pay for military co-operation with economic concessions: it wants both greater contributions and more balanced trade.

In Europe, the Trump administration is proceeding on the same basis. Trump’s antipathy towards the EU and its political culture is disconcerting. But the problem of burden-sharing has haunted Nato since its inception, and until the 1980s, at least, the Europeans were significant contributors. Until 1989, Germany’s Bundeswehr was a heavily armoured and mechanised force of 500,000 men with a mobilisation strength of 1.5 million. Though its loyalty to the Federal Republic wasn’t in doubt, it was unmistakably a descendant of Germany’s military past. The break following the end of the Cold War was dramatic, not just in Germany but across Europe. Spending collapsed; conscription was abolished; Europe’s contribution to Nato’s effective strength dwindled. There were also deep disagreements between Germany, France, and the US over strategic priorities, particularly on Iraq and the war on terror. But differences in threat-perception are no excuse for the dereliction of Europe’s security landscape. If Europe really feels as safe as it claims to, it should have the courage to push for even deeper cuts. Instead, it continues to maintain military establishments which, taken together, make it the world’s second or third largest military spender, depending on how you add up the Chinese budget. But given that it is spread across 28 poorly co-ordinated, undersized forces, Europe’s $270 billion in defence spending isn’t enough to buy an adequate deployable military capacity. Aside from its value as a work-creation measure, the only justification for this huge waste of resources is that it keeps the Americans on board.

The result is a balance of hard power that has for the last thirty years been extraordinarily lopsided. Never before in history has military power been as skewed as it is today. For better or worse, it is America’s preponderance that shapes whatever we call the international order. And given how freely that power has been used, to call it a Pax Americana seems inapposite. A generation of American soldiers has grown used to fighting wars on totally asymmetrical terms. That for them is what the American world order means. And far from abandoning or weakening it, the Trump administration is making urgent efforts to consolidate and reinforce that asymmetry.

How can the US afford its military, the Europeans ask. Is this just another instance of America’s unbalanced constitution? Isn’t there a risk of overstretch? That was certainly the worry at the end of the 1980s, and it recurred in the fears stoked during the Bush era by critics of the Iraq War and budget hawks in the Democratic Party. It doesn’t play much of a role in the current debate about American power, and for good reason. The fact is that for societies at the West’s current level of affluence, military spending is not shockingly disproportionate. The Nato target, which the Europeans huff and puff over, is two percent of GDP; US spending is between three and four percent of GDP. And to regard this straightforwardly as a cost is to think in cameralist terms. The overwhelming majority of the Pentagon’s budget is spent in the US or with close allies. The hundreds of billions flow into businesses and communities as profit, wages, and tax revenue. What’s more, the Pentagon is responsible for America’s most future-oriented industrial policy. Defence R&D was one of the midwives of Silicon Valley, the greatest legitimating story of modern American capitalism.

If Congress chose, defence spending could easily be funded with taxation. That is what both the Clinton and Obama administrations attempted. The Republicans do things differently. Three of the last four Republican administrations – Reagan, George W Bush and now Trump – combined enormous tax cuts for the better-off with a huge surge in defence spending. Why? Because they can. As Dick Cheney declared, to the horror of Beltway centrists: “Reagan showed that deficits don’t matter”. US Treasuries will be a liability for future American taxpayers, but by the same token, they constitute by far the most important pool of safe assets for global investors. Foreign investors hold $6.2 trillion in US public debt, 39 percent of the debt held by investors other than America’s own government agencies. US taxpayers will be making heavy repayments long into the future. But they will make those payments in a currency that the US itself prints. Foreigners are happy to lend in dollars because the dollar is the pre-eminent global reserve currency.

The hegemony of the dollar-Treasury nexus in global finance remains unchallenged. The dollar’s role in global finance didn’t just survive the crisis of 2008: it was reinforced by it. As the world’s banks gasped for dollar liquidity, the Federal Reserve transformed itself into a global lender of last resort. As part of his election campaign in 2016, Trump undertook an extraordinary vendetta against Janet Yellen, the Fed chair. But he was more restrained after he took office, and his appointment of Jerome Powell as her successor was arguably his most important concession to mainstream policy opinion. Needless to say, Trump is no respecter of the Fed’s “independence”. When it began tightening interest rates in 2018 he pushed back aggressively. (As a man who knows a thing or two about debts, he prefers borrowing costs to be low.) His bullying scandalised polite opinion. But rather than undermining the dollar as a global currency, his interventions were music to the ears of hard-pressed borrowers in emerging markets. The same applies to the giant fiscal stimulus that the Republicans launched with their tax cuts: despite rumblings of a trade war, it has kept the American demand for imports – a key element of its global leadership – at record levels.

The world economic order that America oversees was not built through consistent discipline on the part of Washington. Discipline is for crisis cases on the periphery, and dispensing it is the job of agencies like the IMF and the World Bank. Both have been through phases of weakness; in a world in which private funding is cheap and abundant even for some of the poorest countries in the world, the World Bank is struggling to define its role. But the IMF is in fine fettle, largely because the Obama administration pushed the G20 to add $1 trillion to its funding in 2009. So far the Trump administration has shown no interest in sabotaging Christine Lagarde. Over the latest bailout for Argentina, the Americans were notably co-operative. A key issue will be the rollover of the crisis-era emergency funding; from the point of view of international economic governance that may prove to be the most clear-cut test yet of the stance of the Trump presidency.

A stark illustration of the asymmetrical structure of American world order came in recent months in the use of the dollar-based system of invoicing for international trade to threaten sanctions against those tempted to do business with Iran. This outraged global opinion; the Europeans were even roused to talk about the need for “economic sovereignty”. What they are upset about isn’t the lack of order, but America’s use of it. To many, Trump’s withdrawal from the Iran nuclear agreement is another indication of American unreliability and unilateralism. But why is anyone surprised? It took extraordinary political finesse on the part of the Obama administration to secure backing for the Iran deal in Washington. It was always more than likely that a Republican administration would repudiate it. That may be disagreeable but it can hardly be described as a rupture with the norms of American world order. The system is hierarchical. While others are bound, America retains the sovereign freedom to choose. And that includes the right to revert to the cold war it has been waging against the Iranian Revolution since 1979.

The same harsh logic applies when it comes to the Paris Agreement on climate change. Clearly, it is a disaster that the US has pulled out. But Congress and the George W Bush administration did the same to the Kyoto Protocol at the beginning of the century. Moves like this should not be interpreted as a rejection of international order tout court, let alone as an abdication of American leadership. The Trump administration has a clear vision of an energy-based system of American leadership and influence. It is based on the transformative technological and business breakthrough of fracking, which has broken the grip of Russia and the Saudis on oil markets and is turning the US into a net exporter of hydrocarbons for the first time since the 1950s. Liquefied natural gas is the fuel of the future. Terminals are being built at full speed on the Texas shoreline. Fracking was originally a wildcat affair but big corporate money is now pouring in. The oil giant ExxonMobil is back (after a weak commercial patch and Rex Tillerson’s humiliating stint at the State Department), investing heavily in huge new discoveries in Latin America. All this will be horrifying to anyone convinced that the future of humanity depends urgently on decarbonisation. But again it is unhelpful if the aim is to grasp the reality of international order, to conflate it with a specifically liberal interpretation of that idea.

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If Republican policy is just Republican policy, American military power is waxing not waning, and the dollar remains at the hub of the global economy, what exactly is it that is broken? The clearest site of rupture is trade and the associated geopolitical escalation with China. The US is engaged in a sustained and effective boycott of the WTO arbitration system. But the WTO has been ailing for a long time. Since the Doha round of negotiations became deadlocked in the early 2000s it has made little contribution to trade liberalisation. In any case, the idea that legal agreements such as those done at the WTO are what drives globalisation puts the cart before the horse. What really matter are technology and the raw economics of labour costs. The container and the microchip are far more important motors of globalisation than all the GATT rounds and WTO talks put together. If in the last ten years globalisation appears to have stalled, it has more to do with a plateau in the development of global supply chains than with backsliding into protectionism.

In this regard, the Trump administration’s aggressive attack on America’s regional trade arrangements is more significant than its boycotting of the WTO. It is in regional integration agreements that the key supply chain networks are framed. The abrupt withdrawal of the US, in the first days of the Trump presidency, from TPP in the Asia-Pacific region and TTIP in the Atlantic, was a genuine shock. But it is far from clear that either arrangement would have been pursued with any energy by a Hillary Clinton administration. She would no doubt have shifted position more gracefully. But the political cost of pushing them through Congress might well have been too high.

In spring 2017 there was real concern that Trump might abruptly and unilaterally cancel Nafta – apparently the hundredth day of his presidency had been set as the occasion. But that threat was contained by a concerted mobilisation of business interests. Once the negotiations with Mexico and Canada started, the tone was rough. In Robert Lighthizer as his trade representative, Trump has found a bully after his own heart. But again, if you look back at the history of Nafta and WTO negotiations, tough talk is par for the course. In the end, a replacement for Nafta emerged, in the form of the United States Mexico Canada Agreement (USMCA). Apart from minor concessions on dairy exports to Canada and intellectual property protection for American pharmaceuticals, its main provisions concerned the car industry, which dominates North American trade. To escape tariffs, forty percent of any vehicle produced in Mexico must have been manufactured by workers earning $16 an hour, well above the US minimum wage and seven times the average manufacturing wage in Mexico. Three-quarters of a vehicle’s value must originate inside the free-trade zone, restricting the use of cheap imported components from Asia. This will likely induce a modification but not a wholesale dismantling of the production networks established under Nafta. Though it was not endorsed by US trade unions, it wasn’t repudiated by them either. As the American Federation of Labour and Congress of Industrial Organisations commented, the effect will depend on how it is implemented.

The auto industry was at the heart of the Nafta renegotiation and it is the critical element in simmering US-EU trade tensions too. Let there be no false equivalence, however: the incomprehension and disrespect shown by the White House towards the EU is unprecedented. It isn’t clear that Trump and his entourage actually grasped that America no longer maintains bilateral trade deals with individual members of the EU. Trump’s open advocacy for Brexit and encouragement of further challenges to the coherence of the EU has been extraordinary. The use of Section 232 of the Trade Expansion Act to investigate car imports from Germany as a threat to American national security is absurd. Such things mark a bewildering break with previous experience. That said, Trump’s obsession with the prevalence of German limousines in swanky parts of New York does highlight another painful imbalance in transatlantic relations: the persistent European trade surplus. Of course, America contributes to this imbalance with its disinhibited fiscal policy: the better off Americans feel, the more likely they are to buy German cars. But as the Obama administration repeatedly pointed out, Europe’s dogged refusal to stimulate faster growth is as bad for Europe as it is for the world economy. The scale of the Eurozone’s overall current account surplus is highly unusual by historical standards and is both a vulnerability for Europe, leaving its producers hostage to foreign demand, and a potential source of global shocks.

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Europe’s freeriding may undermine the global order, but the EU does not mount a direct challenge to US authority. China is different, and that is what truly marks out the foreign relations of our current moment as a break with the decades since the end of the Cold War. No one, including the Chinese, anticipated how rapidly the Trump administration would escalate tensions over trade in 2018 or that this would evolve into a comprehensive challenge to China’s presence in the global tech sector. The US has been putting pressure on its allies to cut the Chinese telecoms giant Huawei out of their plans for 5G, the next generation of internet technology. But here the US – and its allies – are in reactive mode: the original shock was China’s unprecedented growth.

China alone was responsible for a doubling of global steel and aluminum capacity in the first decade of the 21st century. Its huge investment in R&D transformed it from a “third world” importer of Western technology into a leading global force in 5G. As the likes of Navarro and Lighthizer see it, it was the naivety of enthusiasts for an American-led world order in the 1990s that allowed China’s communist-run state capitalism into the WTO. What the globalists did not understand was the lesson of Tiananmen Square. China would integrate, but on its own terms. That could be ignored in 1989 when China’s economy accounted for only four percent of global GDP: now that figure is close to twenty percent. As far as the American trade hawks are concerned, competition within an agreed international order is to be welcomed only so long as the competitors agree to play by America’s rules, both economic and geopolitical. This was the lesson Europe was made to learn after the Second World War. It was the lesson that Japan was taught the hard way in the 1980s and early 1990s. If China refuses to learn that lesson, it must be contained.

America retains some huge advantages. But it would be dangerous, the argument goes, simply to count on those. Sometimes American preponderance has to be defended by a “war of manoeuvre”. The emerging American strategy is to use threats of trade policy sanctions and aggressive counter-espionage in the tech arena, combined with a ramping up of America’s military effort, to force Beijing to accept not just America’s global preponderance but also its terms for navigation of the South China Sea. In pursuing this course the Trump presidency has a clear precedent: the push against the Soviet Union in the early 1980s by the Reagan administration, which deployed economic and political pressure to break what was perceived to be a menacing phase of Soviet expansion in the 1970s. Despite all the risks involved, for American conservatives that episode stands as the benchmark of successful grand strategy.

The reason the attempt to apply this lesson to present-day China is so shocking is that US business is entangled with China to an immeasurably greater degree than it ever was with the Soviet Union. If you are seeking a component of the American world order that is really being tested at the present moment, look no further than Apple’s supply chain in East Asia. Unlike South Korea’s Samsung, the Californian tech giant made a one-way bet on manufacturing integration with China. Almost all its iPhones are assembled there. Apple is an extreme case. But it is not alone. GM currently sells more cars in China than it does in the US. America’s farmers converted their fields wholesale to grow soybeans for export to China, only to find themselves cut out of their biggest market by Brazilian competitors. And it isn’t just American firms that are caught up in the escalation of tension. Important European, South Korean, Taiwanese and Japanese businesses have staked huge wagers on China.

Given these investments, one might have expected more pushback against Trump’s China strategy from US business. So far there has been little. The radical decoupling of the Chinese and American economies may be so horrible a prospect that business leaders simply prefer not to discuss it in public. They may be lying low hoping the row blows over. Or it may be that American business itself buys the increasingly pessimistic diagnosis of the US intelligence and defence community, who argue China’s persistent protectionism and economic nationalism may mean that it presents more of a threat than an opportunity. Even top “China hands” like Steve Schwarzman and Hank Paulson have warned of a chill in the air.

The hardening of attitudes towards China is not confined to America. It was the Anglo-American intelligence consortium known as “Five Eyes” that raised the alarm about Huawei’s capability to build back doors into the West’s most sensitive telecommunications networks. Canada and Australia are deeply concerned about Chinese penetration. The new pessimism about Sinocentric globalisation isn’t confined to security policy hawks, but shared by many mainstream economists and political scientists in US academia, the think-tank world, and journalists and commentators on Chinese affairs. The liberal version of the American world order is deeply influenced by strands of modernisation theory, the up to date version of which is encapsulated in the doctrine of the middle-income trap. Very few large countries have managed to grow beyond China’s current level of income. Those that have done so have kitted themselves out with the full set of liberal institutions and the rule of law. On this reading, China is in a precarious position. Xi’s authoritarian turn is a decisive step in the wrong direction. Further frequently cited signs of Chinese weakness include ethnic tensions and the ageing of the population as a long-term effect of the one-child policy. There is a belief, held well beyond the administration, that the tide may be turning against Beijing and that now is the moment for the West to harden the front.

This would indeed constitute a break with the narrative of globalisation since the 1990s. But it would hardly be a break in the American-led world order. To imagine the American world order as fully global is, after all, a relatively recent development. After 1945, the postwar order that is generally seen as the non plus ultra of American hegemony was built on the hardened divisions of the Cold War. Where China is concerned, the issue is not so much America’s intention to lead as to whether others are willing to follow. Building the Cold War order in Europe and East Asia was comparatively easy. Stalin’s Soviet Union used a lot of stick and very little carrot. The same is not true of modern-day China. Its economy is the thumping heart of a gigantic East Asian industrial complex. In the event of an escalation with China, particularly in East Asia, we may find ourselves facing not so much an end of the American-led order, as an inversion of its terms. Where the US previously offered soft-power inducements to offset the threat of communist military power, backed up by hard power as a last resort, in the next phase the US may become the provider of military security against the blandishments offered by China’s growth machine.

But this is premature. As of today, two years into the Trump presidency, it is a gross exaggeration to talk of an end to the American world order. The two pillars of its global power – military and financial – are still firmly in place. What has ended is any claim on the part of American democracy to provide a political model. This is certainly a historic break. Trump closes the chapter begun by Woodrow Wilson in the First World War, with his claim that American democracy articulated the deepest feelings of liberal humanity. A hundred years later, Trump has for ever personified the sleaziness, cynicism, and sheer stupidity that dominates much of American political life. What we are facing is a radical disjunction between the continuity of basic structures of power and their political legitimation.

If America’s president mounted on a golf buggy is a suitably ludicrous emblem of our current moment, the danger is that it suggests far too pastoral a scenario: American power trundling to retirement across manicured lawns. That is not our reality. Imagine instead the president and his buggy careening around the five-acre flight deck of a $13 billion, Ford-class, nuclear-powered aircraft carrier engaged in “dynamic force deployment” to the South China Sea. That better captures the surreal revival of great-power politics that hangs over the present. Whether this turns out to be a violent and futile rearguard action or a new chapter in the age of American world power, remains to be seen.

ISSN 0260-9592 Copyright (c) LRB Limited 2019