Some Interesting POV.

As you may have noticed in the latest discussion on this blog the issue of those poor Russians--there are some poor Russians, no doubt--continues to haunt many Western minds. Famous shyster from "geopolitics" George Fridman of formerly STRATFOR even came up today with this, I am sure prophetic, wink, wink, vision of Russia and Russians--a collection of platitudes, rumors from Russian liberda (no one of consequence will talk to him in Russia) and cliches which he titled no less than that: 

Russia is the world’s biggest loser from oil’s crash, and that’s reason to worry

Mind you, this is the guy who described how the United States (and NATO) can defeat Russia conventionally in Ukraine in 2015. So, enjoy. Strangely, however, AFP came up today with by far more balanced and, most importantly, very significant distinction between Russians' and Westerners' lives. 

Sokolniki (Russia) (AFP) - After years spent on submarines with Russia's Northern Fleet, Ivan Chernyshyov is having no problem adjusting to life on coronavirus lockdown -- especially as, like many Russians, the retired sailor can escape to the countryside. "It's good here. We'll grow carrots and strawberries and maybe even some potatoes," the 78-year-old says, while his wife Lyudmila trims rose bushes in the garden of their country home outside Moscow.

This is what I am constantly stressing--comparing standard of living between Russians and Westerners, especially Europeans, is a fool's errand. Consider this crucial fact--you see, Western media can sometimes operate with reality, when they want to--which is absolutely not accounted for when talking about Russia's REAL economy:

Nearly half of Russia's population is estimated to have a dacha, so when authorities began imposing lockdown measures on Moscow last month, thousands streamed out of the city.

Very many, I stress that, of those dachas are, well, how to put it politely, full blown houses with garden lots and can give a run for the money to many US suburban houses within $150,000-250,000 price range in some nice established neighborhoods. Recall this comparison recently. Russia's sub-urbanization was proceeding apace for decades now and vast growing dacha communities were to be found as early as 1970s even in such places as Petropavlovsk-Kamchatsky (to be more precise, Elizovo) or some cities in Siberia, not to speak of Moscow. Dachas are not only great supplemental food or even income when some of this food goes to local farmers' markets by the so called "dachniks" (people who own dacha) who decide to sell, but also great places to relax. In my first book I wrote:

But even today each Friday in Summer or early Autumn big Russian cities suffer from enormous traffic jams with millions of Russians driving, or taking a train to their dachas or village homes to not only tend to their gardens and garden beds, small agricultural additions to houses, which in the hard times of the 1990s inhuman “reforms” allowed many to survive. Many still escape the city for the calm and relaxation of pastoral living, going back to their village roots, from where the Russian nation sprouted. It is a totally normal picture to see some Ph.D. in electronics or a designer of crucial parts for aircraft to enthusiastically tend their cabbage, or potatoes with carrots on their country side plots next to often solidly built luxury houses which are still built on the ground from which, throughout centuries, nobody could uproot the Russian soul. (Chapter 5, page 124)

As one commenters to this article noted:

Western media always portrays Russians as very poor people. However, it seems that half of them have a second home in a country side? How is that for being poor?

Yes, this is the paradox and reality which even best Western alleged "scholars" could not perceive during the Cold War 1.0 and still cannot wrap their brains around this whole thing today. Here is how dacha (and their neighbors') of our relatives looks like in 80 kilometers (50 miles) from Moscow and those are pretty average, nice, but nothing overly special, except a large lot (they don't grow anything). 

So, the way wealth is spread in Russia, despite inevitable catastrophic stratification of 1990s during a nation-wide robbery, is rather different from the West even today. The process or dual-residency will continue in Russia and here is another wowser for many westerners--most Russians OWN their apartments (flats) and dachas, that means are not in debt on this valuable real estate. Russia's mortgage market is minuscule compared to cyclopic debt bubble of the American real estate and, you may have guessed it already, in US "economic science" this huge bubble is counted towards GDP. This is the fact which great "strategic mind" of George Fridman simply cannot grasp--it is difficult when one is brought up within Wall Street bubble and on cooked books. 

Another One .

You know that I am on record, in fact I am explicitly on record, forcefully and with emphasis, that  US "Russia Study" field from the very political top, up to a level of POTUS, to the very bottom of a food chain populated with graduates of all kinds of useless programs and pseudo-sciences who do "research" on Russia by communicating with Russia's cultural, political and ideological rabidly pro-Western fringes because it is the only environment where these pseudo-scholars and allegedly "intelligence" people can get what they WANT to hear, not what is needed to be heard, is a wasteland. In general, American field on Russia is populated with people who literally have no clue. Such as Thomas Graham from Yale and from good ol' Henry Kissinger snake oil org dealing in BS in allegedly "geopolitics", business and other useless consulting. 

I never hid the fact that US skills in foreign policy in general, and towards Russia in particular, are those of the third world nation and I know many third world nations whose diplomatic and analytical skills are still better. I pointed out not for once, and I am writing the third book on this issue, that US problem, far from being ignorant of the outside world, is, in fact rooted in a complete lack of self-awareness by US political class which exists primarily in an echo-chamber of shoddy "scholarship", mediocre thinkers, if that, and in an absence of a reliable understanding of real power. They simply have no method, period. The reason they don't have this method is because they place money at the center of any "analysis" without understanding of how real economies work and because of a rather weak grasp of the actual history. In general, as I stated not for once, it is next to impossible to explain humanities-"educated" (Graham has BA in "Russian Studies" and Ph.D in Political "Science", which means he wasted years studying BS) product of US Ivy League humanities madras how Russia really works, starting from economy to military, to political culture. Being a product of US "political culture", that is to say show-business, Graham wrote a piece two day ago which is very US political class, obsessed only with own appearances, symptomatic.  

                           Oil Crisis Tests Putin’s Skill to Project Strength

Projection of whatever sells as an illusion of competence, power and electability is, actually, a very American thing. In fact, it is the foundation of the election theater known as American "democracy". This is not to say that Putin doesn't "project", he surely does, but this projection is nowhere near in its falsity, superficiality and staging than it is the case with now running non-stop US election-campaigns. In this case Graham exhibits a very American political idiosyncrasy which puts forward appearances not the content. He surely confirms this immediately:

NEW YORK: Russian President Vladimir Putin refuses to yield under pressure. That is a matter of pride for Putin himself and a key aspect of his appeal to Russian elites and the public alike. The trick is preserving that reputation in the real world, where leaders routinely miscalculate and pivot while remaining loathe to admitting mistakes. The plunge in oil prices because of the COVID-19 pandemic and the collapse of the OPEC+ agreement on production cuts provide the most recent test.

Graham is butt-hurting and it shines through his traditional for US policy-making craft, and resorting to a traditional making shit up, which one would expect from a middle-level former bureaucrat in W. Administration well-known for fvcking it up majorly both for the world and the US. Graham lies, of course, because increase (and, most importantly, dynamics) of Russia's gold and currency reserves clearly indicated in Bank of Russia statistics, that Russia was in reserves' mobilization mode well before any actions at Vienna's OPEC meeting in March this year. 

One can easily go to the site of Bank of Russia and apply filter say from April 2015 through April 2020 to see a dramatic growth of reserves, such as three fold growth of gold reserves alone. For Graham, obviously, it is not of any value since he doesn't understand the state of mind of majority of Russians who DO understand that they are in the existential struggle with the combined West led by the United States and the only thing Putin MUST project is a commitment to finish this fight. Russia was mobilizing for this fight since Munich Speech in 2007. Well, Graham, being a manager of Kissinger's org, should read his own boss' admission in 2015 where good ol' Henry stated (or accidentally dropped) the truth which majority of Russians (no, not the Russians Graham knows) are keenly aware of:

"Kissinger: If we treat Russia seriously as a great power, we need at an early stage to determine whether their concerns can be reconciled with our necessities. We should explore the possibilities of a status of nonmilitary grouping on the territory between Russia and the existing frontiers of NATO. The West hesitates to take on the economic recovery of Greece; it’s surely not going to take on Ukraine as a unilateral project. So one should at least examine the possibility of some cooperation between the West and Russia in a militarily nonaligned Ukraine. The Ukraine crisis is turning into a tragedy because it is confusing the long-range interests of global order with the immediate need of restoring Ukrainian identity. I favor an independent Ukraine in its existing borders. I have advocated it from the start of the post-Soviet period. When you read now that Muslim units are fighting on behalf of Ukraine, then the sense of proportion has been lost.

Heilbrunn: That’s a disaster, obviously.

Kissinger: To me, yes. It means that breaking Russia has become an objective; the long-range purpose should be to integrate it."

I will omit here Kissinger's complete lack of any foresight in regards to "integration", but Graham surely knows that there are no any altruistic intentions of the West towards Russia. Russians, being people well-conditioned by real wars, of which Graham has no real knowledge, exist in a different political and cultural reality to which US "methodology", fraudulent as it is, does not apply in principle. It is a complete different cultural and geopolitical thinking reality. The only people who do have at least some connection to this Russian reality are those from actual military and intelligence community who have to deal with tangibles, which, as it turned out, US political class ignores due to inability to understand them.  As a result Graham arrives to this:

But Moscow did not anticipate the Saudi reaction to its refusal to agree to further cuts. The Saudis’ threat to open the spigot and offer steep discounts on their oil exports pushed oil prices down to lows not seen in decades. The price war had begun, even if only the Saudis were prosecuting it robustly: The Saudis had the capacity to add 2.5 million barrels a day, the Russians, 300,000. True to form, Moscow was defiant. Despite Russia’s dependence on oil for two-thirds of its export earnings and 40 percent of its budget revenue, the Ministry of Finance announced that Russia could withstand prices as low as $25 a barrel for up to ten years. It would draw on its $150 billion National Wealth Fund to cover gaps in the budget, currently based on an oil price of $42 a barrel. That was certainly an exaggeration, and the Russian oil industry itself would suffer significant damage in the short term if wells had to be capped. Still, the ministry sent the unequivocal message that Moscow would not back down.

Ah, no. It was anticipated, because unlike W. Administration of which Graham was a part of, such as "planning" some shit, I guess how to lose the war and bankrupt the United States in the process, Russia (Putin) operates on a completely different plane of a strategic planning and as the track record of the US and Russia in the last 10 years are compared, well let's speak in broadsides here, US "record" is that of a dysfunctional country incapable to even govern itself, let alone achieve any tangible political objectives abroad. Simple as that. What Russia may not have anticipated (and even that is a question) was an unfolding of Covid-19, but that is the whole other story altogether. Moreover, as latest data from bank of Russia shows in terms of drawing on Russia's gold-currency reserves, Russia, indeed, can sustain this oil war for many years. So, why Graham arrives to the conclusion that it is an "exaggeration" remains  mystery known only to "analysts" such as him and, as I already stated above, their abilities are centered mostly around handling appearances, aka PR, and not operating with actual data and facts on the ground. If that would have been otherwise we would have had by now a stream of the American first-rate geopolitical and strategic thought. Instead what we have is a feeble exercise in chimeras, simulacra and demagoguery ranging from Fukuyama and Brzezinski to even late Huntington's attempts to make sense of the unfolding world which American self-proclaimed "intellectual" class largely is utterly unprepared. Graham is not an exception. 

Here is a fact which Graham cannot face, that is why he continues to make shit up, when writing about oil wars:

US President Donald. Trump gave Putin the opening he sought. Trump initially greeted the price collapse as a “big tax cut,” but by the end of March, he changed his tune under pressure from the domestic oil sector. He set about trying to persuade the two strongmen he had cultivated since assuming office, Saudi Crown Prince Mohammed bin Salman and Putin, to agree to major production cuts.On March 31, Trump called Putin to discuss the novel coronavirus crisis and oil markets. Kremlin statements routinely note who initiates the call when Putin talks to foreign leaders, and the Kremlin readout makes it clear that Trump made the call – the inference was that Trump, not Putin, urgently needed relief from the price war and the pandemic.

This is a loaded (with utter butt-hurt) statement which reads like lament. For starters most countries, to the best of my knowledge, disclose on whose initiative phone calls are made between the heads of state. And, actually, if Mr. Graham would have followed events of the last couple of weeks he would have understood that it was and still is Trump who desperately needs anything, something which would save now wrecked US shale oil. There are NO inferences, there are only facts on the ground: Russia can ride this crisis out, the United States cannot and Texas Railroad Commission will meet on April 21 to discuss desperate cuts. Hey, don't look at me, just read the titles:

"If the Texas Railroad Commission does not regulate long term, we will disappear as an industry, like the coal industry," said Scott Sheffield, CEO of Pioneer Natural Resources, referring to the state agency that oversees oil and gas production. "The Commission really does not have any wiggle room to do nothing in the unprecedented, disastrous circumstances of today."

This was Russia's position from the get go and it was explicitly articulated by Putin on a number of occasions: Russia was ready to cut ONLY if the United States takes part in those cuts.  

Russia may be willing to reduce its oil production by as much as 1 million bpd, or a little under 10 percent of its March average but only if the United States joins the cuts, Bloomberg has reported citing sources it said were familiar with the dominant sentiment in the industry.

This was repeated so many times, on so many occasions, that I don't know how Graham has missed that. Moreover, Russia's main long term objective is to attach the United States to a newly emerging Cartel and to restrain US attempts to pull blanket on itself. Moreover, this whole event shows Russia's even bigger goal for setting up what was already dubbed as Yalta 2.0 where new world order would be formalized.  Today, against the background of mounting empirical evidence of the American collapse and departure as self-proclaimed hegemon, new arrangements between superpowers are an utter necessity. United States may continue with its incessant propaganda and pretense that it is what it thinks it is, but the era of the American "dominance" across the board is over, it was over for some time now. United States still remains a superpower, but it is a superpower among few others and the better this fact is internalized and more humble attitudes are developed before getting to the negotiating table, the better it will be for all parties involved, including the United States herself which is in dire need of putting its own house in order for a long time. But don't expect "expertise" from such people as Graham to be of any use for that, not only spinning, a euphemism for lying, is the only skill they have but the fact of being sore losers only compounds their inability to face reality. 

Noblesse Oblige.

Merriam-Webster gives this definition of Noblesse Oblige: 

the obligation of honorable, generous, and responsible behavior associated with high rank or birth.

This time, however, we apply this definition not to the particular person or persons, but to the nations. No, don't expect me to talk about past, we need to concentrate on the present and the future. I periodically hear and read such fantasies: can you imagine if the United States, China and Russia would cooperate, what a wonderful world would it be then. I am not against this fantasy and I understand its appeal but I am also a hard core realist (no, not in American sense of realism which is largely a misnomer for a "slightly less exceptionalist") and I understand that this state of the affairs is, for now at least, well, fantasy. This, however, should not relieve superpowers from having Noblesse Oblige and exercising it. How? Let's go back in history before the United States completely went off the rails and at least tried sometimes to exercise Noblesse Oblige.  Here is an account of the US military exercising it to the fullest in 2005. 

JAKARTA, Indonesia, Feb. 4 - The United States aircraft carrier that provided the base for dozens of daily helicopter flights carrying food and water to tsunami victims in Aceh left the area Friday, American officials said. The departure of the Abraham Lincoln, the centerpiece of the American effort in devastated Aceh, signaled the Indonesian government's desire to move from the delivery of emergency relief to plans for reconstruction of the devastated province.... The United States military's efforts included flying more than 2,800 relief missions and treating 2,200 patients, the American Embassy here said. In place of the aircraft carrier, an American naval hospital ship, the Mercy, arrived off Aceh on Friday, American officials said. The ship, which has about 1,000 hospital beds, headed for Aceh from San Diego soon after the tsunami struck.

This is how you do it, folks, and nobody has the right to forget that. This is how superpowers are supposed to behave in a global stress situations. Russians know this, they sent today a giant AN-124 Ruslan stuffed with medical supplies to the United States:

China was helping non-stop many others. Noblesse Oblige, folks. But how it relates to oil wars, you may ask? Well, here is the deal. Trump DID call Putin and they had a long conversation which dealt with issue like this, no it is not April Fool's joke, it is reality:

Whiting Petroleum filed for bankruptcy protection, while Saudi Arabia ignores President Donald Trump and moves ahead to push oil prices down further. Oil prices came under additional pressure Wednesday after the U.S. Energy Information Administration reported domestic oil stockpiles soared by 13.8 million barrels, more than triple the estimate for an increase of 4 million. Gasoline stockpiles surged by 7.5 million barrels as demand dived 25% to the lowest level since 1993.

Says it all, and US shale oil industry is in deep-deep trouble, so much so that POTUS was forced to talk to Putin and.... he hasn't been ostracized for this call by even most vile DNC-controlled media, at least not yet. There is a reason why: Russia is a state actor which could be reasoned with, unlike is the case with MBS and Saudis, and here is this Noblesse Oblige point between the US and Russia, which doesn't exist between Saudis and Russia with US respectively. Russia understands that utter collapse of US economy, much of which is dependent today on shale oil, is NOT a blessing for Russia, especially when these were Russians who were indicating non-stop that they are interested in relatively soft-landing of the United States which would allow to avoid a huge economic mayhem globally. Unlike the United States, Russians know damn well what collapse of the superpower (USSR) looks and feels like. Russians also take account of US political class, much of which is simply totally corrupt, insane or both. So, Russians ARE NOT interested in the American implosion understanding consequences of that. This is both: understanding of the global trends and responsible behavior which, however emotionally would make sense for many in Russia, precludes burying the United States by annihilating its shale industry. Russians merely want to cut the US to size, not to kill the US, albeit for many this is a very desirable outcome. 

But Russia, again, offers new (in reality-old) rules--Noblesse Oblige--between superpowers. This was in plans before Covid-19 pandemic and was, not without justification, termed Yalta 2.0. Putin proposed this "Big Five" summit in Jerusalem at Holocaust Forum on January 23, 2020 (in Russian). Putin spoke about victors, not losers, for this summit. Of course, this summit is postponed today due to obvious reasons, but the agenda still stands--multipolar world with great powers (superpowers) taking responsibility for its normal and peaceful development. Recall now, that the US is a huge part of this "Big Five", Saudis, however, are not. The multipolar world is already here and American unipolar moment is over, but it doesn't mean that US economy should be deliberately crushed, especially by the shithole of a gas-station masquerading as a country. Yes, it is Saudi Arabia I am talking about. One just don't allow some medieval satrapy which produces only two things, oil (and even that due to someone's expertise and technology) and Islamic radicals, to shape the global outlook before big guns had a chance to settle it.  Nobody in their own mind ever proposed to cancel a pecking order geopolitically. Well, the United States tried, by proclaiming itself a hegemon, but that momentary lapse of reason was momentary in historic terms-some 20-30 years at best. The time of great powers is back with vengeance, Saudis, for some reason decided that they are the players here too. That goes way beyond the oil wars, that Saudi decision has metaphysical and geopolitical ramifications for the new world order--such ramifications are unacceptable.

So, that brings us to a conclusion that, judging by the events of the last 48 hours, US and Russia are negotiating something and Russia already stated today that she will not increase her oil output (in Russian), read this:

WASHINGTON (Reuters) - U.S. Energy Secretary Dan Brouillette spoke with his Russian counterpart Alexander Novak about the slump in global oil markets on Tuesday, and they agreed to hold future discussions involving other major world oil producers and consumers, the U.S. Energy Department said in a release. The call occurred a day after President Donald Trump and Russian President Vladimir Putin agreed in a phone conversation to have their top energy officials discuss the drop in global oil markets. The discussions between Washington and Moscow mark a new twist in global oil diplomacy since a failed deal earlier this month between the Organization of the Petroleum Exporting Countries and Russia to cut production ignited a price war that sent oil prices tumbling. Brouillette and Novak "had a productive discussion on the current volatility in global oil markets," Energy Department spokeswoman Shaylyn Hynes said.

If I would be MBS, I would be shitting my pants the moment I read this news. It is one thing for Saudis to play nations against each-other, totally another--to piss off such dogs as US and Russia, who are now in negotiations on how to handle this shithole of a country which decided that she has the right to, pardon my French, fvck with big guns. I am sure, that both Russians and Americans now are pretty much on the same page in terms of possible, democratic "regime change" in Riyadh. Moreover, I am 100% positive that neither Moscow nor Washington want to deal with MBS at this stage. The guy is, obviously, insane and, frankly, down right stupid. You see, some contours of new world order of Big-2 (in reality 3, with China in the background) already in a process of helping it to emerge. This is superpowers' Noblesse Oblige to each-other. It is an exclusive club and it should remain such. This, plus, in the end, rephrasing the words of one American general about Russians during Detente of 1970s, when he was speaking about comparing Rooskies and Chinese: Russians are, of course, sons of bitches, but they are our sons of bitches--they, like us, like nice suits and good Whiskey. This applies completely in reverse in relations to the US. Especially once present American "elites" will be cleaned out and place disinfected by current events and tribulations they bring.   

We live in insane times, inside a geopolitical shift of unprecedented scale which, if we survive it, will be recorded in history as a final gasp of the liberalism and the ruin it brought upon the humanity. Some, in these times, lose their head and begin to behave irrationally, without calculating consequences for themselves and others. This is what Saudis did hoping for their bluff not to be called. It was called and now we have a rather unique situation, Russia and US cooperating. Hm, who would have thought. As per shale oil industry--it is for oil specialists to discuss if it will survive as such and if it will remain strictly for a domestic consumption. I do not want to go further in speculations on what would happen if Saudi Arabia ceases to exist as a state? Anything is possible in crazy times, including the emergence of some strange geopolitical configurations, especially when Noblesse Oblige is exercised.   

UPDATE: immediate follow-up. Here are some more details. 

For the member countries of OPEC+, mandatory cut in their oil output levels ended as of Wednesday, while the future of alliance between Moscow and Riyadh remains unclear. Russia and Saudi Arabia are currently not holding any talks regarding the oil market, the Kremlin spokesman Dmitry Peskov said on Wednesday. He added that Putin has no plans to set up a phone call with Saudi leadership, adding the two countries can initiate a dialogue if necessary.