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US sanctions: A case of friendly fire

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In an article published on the Washington-based website The Hill, Richard Sawaya, vice president of the US National Foreign Trade Council, writes about the serious damage that the anti-Russian sanctions are causing to America’s business interests. Richard Sawaya is also convinced that the irresponsible use of sanctions actually undermines the United States’ leading role in the realm of “international finance.”

The US business community and experts have been talking about the disastrous impact of the US-imposed unilateral sanctions on the United States itself since at least the 1990s, when these sanctions were already reducing the US’ share of a number of important export markets and resulting in up to $1 billion dollars’ worth of wage losses for US company employees.

Donald Trump came to power under the slogan of maintaining America’s dominant position in the world, which he views as an arena of tooth-and-claw competition between states. Trump believes that countries that are not ready to accept Washington’s conditions, especially those pursuing an independent policy, are “legitimate” targets for sanctions. Dozens of countries, including a number of leading nations, some of each happen to be America’s nominal allies, are already suffering the consequences of these sanctions. According to many European political analysts, the US sanctions are aimed at changing the balance of power in the global economy. The fact of the matter is, however, that this policy has increasingly been leading to quite opposite results.

For example, in many cases these sanctions prove detrimental to America’s foreign policy interests. Indeed, the restrictions that Washington has imposed on the oil industry of Iran or Venezuela do not necessarily harm these countries’ leaderships. Meanwhile, according to Western media reports, Washington’s actions are ramping up oil prices, thus filling the state coffers and stimulating the oil industry of America’s other rival – Russia. Moreover, external pressure is actually encouraging the rapprochement between Moscow and Beijing, which is “absolutely against America’s interests,” which is something Trump has repeatedly been reminded of since the publication of his National Security Strategy in December 2017.

Besides, America’s European allies are getting increasingly wary of the aggressive financial and economic sanctions being “generously” ladled out by Washington. A report, released in February 2020 as part of the preparations for this year’s international security conference in Munich notes that “according to critics, the United States is using security problems as “a smokescreen for its own economic interests.” As a result, the US policy threatens to disintegrate “the West as a community bound by liberal-democratic values.”

“We are witnessing the decay of ‘the West’ as a relatively cohesive geopolitical configuration,” the report said. “The world is becoming less Western. But more importantly, the West itself is becoming less Western, and the world as a whole is becoming less Western, too.”

It is against this backcloth that more and more European politicians are beginning to realize that developing positive, good-neighborly relations with Russia is in the best interest of “all the peoples of the continent.”

Finally, Washington’s policy of sanctions and financial and economic pressure has encouraged the formation of a financial system independent of the United States, with Russia, China, India, Iran and Turkey showing a great deal of interest in such a system. The EU too is now looking for ways to counteract Washington’s financial domination and circumvent its sanctions. Proposals are being made to create an independent financial settlement system – the European Monetary Fund (similar to the IMF), as well as a financial instrument “completely independent” from the United States.

Certain progress on this track has already been made. According to The Economist, China is working hard to create its own international payment system based on the yuan. Other Western experts believe that the US withdrawal from the Iranian nuclear deal has already contributed to the growth of trade in oil futures denominated in the Chinese currency, which was recently launched at the Shanghai Stock Exchange. Finally, even though none of the existing economic associations still has a financial system comparable to the US’, viable mechanisms are already being created to conduct effective trade operations with companies and countries victimized by Washington’s sanctions. Notably, it was America’s European allies – including France, Germany and the UK, who initiated the creation of INSTEX – a special purpose vehicle to help EU companies do business with Iran. Belgium, Denmark, Finland, the Netherlands, Norway and Sweden joined it by the end of 2019, but this system has not become fully operational yet.

Meanwhile, US businesses are already feeling the pinch of Washington’s extraterritorial sanctions. The US clampdown on a number of Chinese high-tech corporations, above all Huawei, caused by Washington politicians’ failure to understand the specifics of the global technology market threatens to undermine Google’s dominant position in the global mobile platforms market. Google, for its part, is bending over backwards trying to convince Washington officials of the extremely negative consequences of a possible loss of the Chinese market that could eventually encourage Beijing to develop its own platforms and operating systems for mobile devices and network infrastructure. Experts warn that if “an alternative to Android appears … many countries, for their own safety, will embark on a policy of supporting a competing platform.”

In February of this year, it became known that the Chinese IT giants Xiaomi, Huawei, OPPO and Vivo, which account for more than 40 percent of all mobile phones delivered to the world market in 2019, were contemplating the launch of the Global Developer Service Alliance (GDSA). The platform, initially planned to launch in nine countries, including India, Russia and Indonesia, can eventually become a powerful alternative to software stores for smartphones and tablets operated by the US corporations Google and Apple. Google could be hit the hardest with commentators saying that the Chinese project is capable of seriously undermining Google’s positions, primarily in emerging markets, such as India and Africa. Google could also find itself on the losing end in markets with a combined potential audience of 4 billion users in China, India and the African region.

Internationally, Washington’s undisguised attempts to check the growth of and even destroy China’s high-tech companies have already convinced many countries worldwide of the need to have independent IT developers. As a result, they could restrict or ban altogether services and products provided by US companies on their territory. At least, this could impact such an important sector as public procurement. Many countries may also prioritize measures to encourage the creation and development of national information products, services and software. Ultimately, there is a growing threat to the positions of the leading Silicon Valley companies in the global market, not least due to the actions taken by shortsighted and arrogant politicians in Washington. All this could eventually set in motion a process of disintegration of the global IT market and the creation of blocs and coalitions of countries focused on domestic manufacturers of equipment and developers of software and technological standards all their own.

One textbook example of this were the events of 2018, when the United States imposed sanctions on the Russian aluminum producer Rusal. The impact of this move against one of the world’s leading aluminum exporters was felt not only on global markets, but it also sent aluminum prices in the US itself tens of percent up, resulting in serious losses for major US aircraft manufacturers and machine builders. As a result, the US Treasury Department backed off and started lifting sanctions from the Russian company. Also in 2018, a number of large-scale joint projects with significant participation of leading Western oil companies were suspended in Russia. US firms were hit the hardest with ExxonMobil suffering significant losses after being forced to cancel contracts with Rosneft in the Kara Sea.

In December last year, the US Senate Foreign Relations Committee approved the Defending American Security from Kremlin Aggression Act, known by the acronym DASKA. Meanwhile, according to Richard Sawaya, “DASKA’s energy provisions would take collateral damage to new heights.” For example, the bill requires US companies to withdraw from any energy project should a Russian entity hold even a minority stake there. According to Sawaya, “there are nearly 150 estimated energy projects in more than 50 countries that would be affected. These projects employ thousands of people and play an important role in the energy supply chain in global hydrocarbon markets. Any disruption to the operations abroad would have a domino effect and damage many small- to medium-sized US businesses.”

Another provision would “prohibit US companies from engaging in transactions of Russian sovereign debt denominated in rubles, which would effectively stymie any US company operations in Russia.” As a result, nearly 3,000 US companies that operate in joint ventures with Russian firms could be forced to exit or shutter operations to the benefit of their non-US (primarily Chinese) competitors. “More broadly, in the global economy with its complex network of multi-country supply chains, ever increasing US sanctions cause US companies to be regarded as unreliable partners.”

Thus, Washington’s belief that large-scale sanctions will strengthen the US’ position in the world has proved to be all wrong as its desire to “punish” opponents is, directly and indirectly, backfiring on the entire sectors of the US economy. At the same time, America’s opponents are increasingly demonstrating their ability to not only guard against US sanction pressure, but also to inflict significant and lasting damage on the financial, economic and technological positions of the United States itself. Meanwhile, Washington keeps undermining its global sway by further alienating many of its key allies. All this is creating powerful prerequisites for the consolidation against the United States of all states that value their sovereignty – that is, most of the countries of the world. 

From our partner International Affairs

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The mistakes of U.S. foreign policy

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A few days ago, in a conversation with one of the former protagonists of U.S. foreign policy, in response to my questions and considerations he replied that the second Iraq-U.S. war was an unnecessary disaster, partly balanced by improved relations with Israel and special attention paid to the petromonarchies of the Gulf. He admitted that he had not managed relations with Egypt in the best way, as the United States could have done after the so-called Arab springs, and that it was arguable that the United States never had a kind of relationship with Iran that was discreet enough to be sustainable.

In fact, the White House’s mistakes and desire to dominate, without regard to the other Parties is a traditional characteristic of U.S. foreign policy. Michael Mandelbaum, Professor at John Hopkins University, had already stated that the United States had lost in the world – a total failure since the end of the Cold War. The history of U.S. foreign policy can be roughly divided into four periods.

1) From the Presidency of George Washington (1789-1797) to the Spanish-American War (1898), U.S. foreign policy was still in its infancy, and the focus remained on the territory.

2) From 1898 to the end of World War II (1945), the United States began to move internationally, playing the role of a major power on the stage of World War I and World War II.

3) From 1945 to the end of the Soviet Union (1991), the United States became one of the two poles of the world, the helmsman of Western order and guardians of world scenario trends.

4) The fourth period started after the victory in the Cold War. In that phase, the United States stood at the height of international power, ignored its peers and subjects of international law, behaving as an apparent hegemonic power in the world, but its foreign policy at that time was rarely successful.

The biggest problem of U.S. foreign policy during the Cold War was national security. It was necessary, at all times, to protect itself from the USSR’s penetration and influence and to strive to improve its military strength in view of ensuring world leadership. This entailed large-scale war production and huge profits for military industries.

After the Cold War, the United States used multiple means such as foreign policy, economic policy and armed intervention as a deterrent (see the Balkan War of 1999) to coerce and attract the attention of China and Russia (its traditional competitors) and later intervene in Afghanistan and Iraq.

For example, in the 1992 Presidential election, Bill Clinton proposed linking the treatment of the most favoured nation to China with the human rights situation. After being elected, he subsequently added Tibet, hoping to improve local human rights and promote change in China (obtusely seen as bound to end up like the USSR), when in fact the destabilisation of that region would have caused a global nuclear upheaval.

The success of the Cold War against a country and a system of production that by then had been reduced to aflicker, to support a defence that was at least a deterrent but never superior to the White House, gave the United States the illusion that Western systems and the free market were superior and universal and could be transposed into foreign countries where any idea/ideology not conforming to the American Way of Life was considered barbaric, backward and uncivilised (European welfare, healthcare, Communism, Socialism, Islam, traditional cultures, the Catholic religion, etc.).

In its own ‘manifest destiny’, the United States supported and provided for missionaries and needed to proactively spread the seeds of civilisation and promote reform in the so-called ‘backward’ and non-allied societies.

The United States overestimated the feasibility of replicating in other countries, such as Afghanistan and Iraq, what it had done by means of nuclear and non-nuclear bombs in Hitler’s Germany and in Imperial Japan, which are currently ‘Western’ models of liberalism.

Although they try successfully and not (see the coloured revolutions), through intelligence, to overthrow the dictator of the day – until yesterday a friend – the U.S. foreign policy think tanks lack knowledge of the social conditions persisting in a given country, not understanding that their own views are insufficient to impose a modern Western-style system, such as the social structure and the concept of the rule of law. When political wisdom is not mature, and ignorance prevails, obviously you go towards failure and peoples’ hatred.

Although the United States is among the best countries in terms of national strength, with its military and soft power, it is inevitably unable to fight multilaterally and at the same time transform a society- it deems backward – thousands of kilometres away.

In a place where the U.S. concepts of democracy and free market have never been known, let alone accepted, wanting to establish a system in their own image is virtually impossible.

And while U.S. military missions are successful (not forgetting, however, the bitter defeats in Korea and Vietnam), at the same time, in political terms, they have reassessed the strength of China and Russia in expanding their presence in certain geopolitical areas.

For example, the war in Syria – fomented to sabotage the Chinese “Silk Road” and damage Russian oil supplies to Europe – has strengthened Russia’s presence in the Mediterranean, and raised before Peoples the China’s traditional principles of anti-colonialism and political non-interference, which are gaining support from South America to Africa, from Europe to Asia.

Not for nothing, Prof. Mandelbaum himself said that rather than adopting violent means to promote the construction of a “Western-style” system in a distant country, it would be better for the United States to adopt cultural systems, values and further soft power to influence, provide assistance and create conditions for the transformation and attraction of Western models into other places for economic, practical and peaceful purposes aiming at peoples’ welfare, and not at establishing a “democratic” dictatorship disliked and hated by ordinary people.

According to the distinguished academic, the United States should act as guardians of international peace and ensure world order, by also ultimately resorting to the international courts of justice, rather than subverting the internal structure of individual countries it wants to change for its own interest relating to the last resources of the planet.

As long as there are advantages and not destruction for the peoples, they will not hesitate to be involved in the phases of change. The game of politics is that of great power, which regains hegemony through consensus and not through the imposition of bombers, the massacres of civilians, and Hollywood-style postcards.

Hence, with a view to avoiding further fiascos, U.S. foreign policy must shift to another phase. It must finally launch a fifth phase, but a peaceful one.

The U.S. website of “Foreign Policy” has recently published the article The United States Needs a New Strategic Mindset. The article criticises the United States for having formulated strategies based only on short-term interests in recent decades. This has resulted in many U.S. mistakes, including the post-9/11 war on terrorism.

According to its author, because the United States lacked a coherent and comprehensive strategic vision for a generation, it took countless short-sighted actions and faced many challenges to its national security and economic prosperity.

The author thinks that, since the end of the Cold War, the United States has paid dearly for its wrong strategy. After the implosion of the USSR, the United States desperately squandered enormous wealth and the lives of a large numbers of soldiers, using paranoia as the response to the terrorist threat.

The article reads as follows: “More recently, it has spent exorbitant sums on what it construes as “great-power competition”, but is really just the defense industrial complex’s same old graft with a different guise – all while its public institutions rot”.

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The 4 groups of Senate Republicans that will decide Trump’s impeachment trial

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With Senate Minority Leader Mitch McConnell pushing back the Trump impeachment trial to mid-February to make sure things cool down, Senate Republicans’ positions on the vote are far from crystallized yet. Here are the four groups of Senate Republicans, according to views and likely vote. The numbers and composition of these four groups will decide Trump’s future political faith. Which group Mitch McConnell chooses to position himself in will also be a deciding factor in the unusual and curious impeachment trial of a former US president no longer sitting in office.

Group 1: The Willing Executioners

There surely are those in the Republican Party such as Senator Mitt Romney and Senator Ben Sasse who cannot wait to give that Yea and the final boot to disgraced former President Trump, and will do that with joy and relief. Both the Utah Senator and the Nebraska Senator may be vying for the leadership spot in the Republican Party themselves but that is not the whole story. Senator Lisa Murkowski of Alaska openly said “I want him out.” This group is unlikely to reach as many as 17 Senators, however, needed for the two thirds Senate majority to convict Trump.

Group 2: The Never Give up on Trumpers

There are also those Republican Senators who will stick with Trump through thick and thin until the end – some out of conviction, but most as someone who cannot afford to alienate the Trump supporter base in their state – a supporter base which is still as strong. 

At least 21 Republican Senators are strongly opposed to voting to convict former President Trump, as reported by Newsweek. They realize that doing so would be a political suicide. Republican voters, on the whole, are unified in their belief that the presidential elections were not fair and Joe Biden did not win legitimately, with 68% of Republican voters holding the belief that the elections were “rigged”. The majority of the Republican Party constituents are Never Give up on Trumpers themselves.

Among them are Senators Cruz and Hawley. Both will fight at all cost a vote which certifies as incitement to violence and insurrection the same rhetoric they both themselves used to incite the Trump crowd. Cruz and Hawley will try to avoid at all cost the legal certification of the same rhetoric as criminal in order to avoid their own removal under the 14th Amendment, as argued already by Senator Manchin and many others.

Senator Ron Johnson even called upon Biden and Pelosi to choose between the Trump impeachment trial and the Biden new cabinet confirmation. Group 2 will fight fierce over the next weeks and you will recognize them by the public rhetoric.

Group 3: I’d really like to but I can’t be on the record for convincing a President of my own party

Then there is a large group of Republican Senators – maybe the largest – who would really like to give that Yea vote and leave Trump behind but they do not wish to go on the record as having voted to convict a US President from their own party. Some of these Senators will share their intention to vote Yea in private or off the record with the media, but when push comes to shove and the final vote, they will be hesitant and in the end will vote Nay. Senator Marco Rubio of Florida falls under Group 3.

Senator Pat Toomey of Pennsylvania is also the illustration of the average Republican Senator right now – someone who said that Trump committed “impeachable offenses” but who is not sure about convicting him through trial, so that probably means a Nay. 

The BBC quoted a New York Time’s estimate from mid-January that as many as 20 Republican Senators are open to voting to convict Trump, but it should be recalled that in the first Trump impeachment trial in 2020, several Republican Senators also shared in private and off the record that they would be willing to convict. After so much discussion, calculations and prognosis, in the end, it was only Senator Mitt Romney who broke ranks on only one of the two impeachment articles, and voted to convict.

The Capitol events, of course, are incomparable to the Ukraine impeachment saga, but it should be accounted for that the trial vote will likely take place sometime in March 2021, or two months after the Capitol events, when most of the tension and high emotion would have subsided and much of American society will be oriented towards “moving forward”. Group 3 will host the majority of Senate Republicans who in the end will decide to let it go. Most of the 21 Republican Senators who already expressed their opposition to convicting Trump actually belong to Group 3 and not Group 2 Never Give up on Trumpers.

Group 4: I am a Never Give up on Trumper but I really want to look like Group 3

And finally, there is the most interesting group of Republican Senators who are secretly a Never Give up on Trumpers but would like to be perceived as belonging to the hesitant and deliberative Group 3 – willing and outraged but unwilling to go all the way on the record to eliminate a former Republican President.

Senator Ted Cruz might move into Group 4 in terms of rhetoric. Never Give up on Trumpers will vote Nay willingly but will try to present themselves as conflicted Group 3 politicians doing it for different reasons.

Which group Mitch McConnel chooses will be the decisive factor in aligning the Senate Republican votes. McConnel himself seems to be a Group 3 Senator who, in the end, is unlikely to rally the rest of the Senators to convict Trump even though McConnel would really like Trump out of the Republican Party, once and for all. The very fact that McConnel is not in a hurry and is in fact extending the cool-off period places him in Group 3. 

Yea voters don’t need time to think about it and look at things. It took House Democrats exactly three days to get it over and done with. McConnel is quoted as willing to give time to “both sides to properly prepare”, allowing former president Trump enjoy due process. But Trump’s legal team will notice quickly that there is not much to prepare for, as they won’t find plenty of legal precedent in the jurisprudence on American Presidents’ incitement to violent insurrection for stopping the democratic certification process on an opponent who is the democratically elected President.

McConnel himself has said that he is “undecided” and that speaks volumes. He is a Group 3 Senate Republican, and with that, Group 3 will describe the mainstream Senate Republicans’ position in the impeachment trial. 

Senate Majority Leader Chuck Schumer set 8 February as the start of the impeachment trial, pushing earlier McConnel’s time frame. This is when it all starts.

It is my prediction that when all is said and done, there won’t be as many as 17 Senate Republicans to vote to convict former President Trump. Trump will walk away, but not without the political damage he has incurred himself and has also left in American political life.

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Two Ways that Trump Spread Covid-19 in U.S.

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Official White House Photo by Tia Dufour

1. Encouraging infected workers to continue working even if it infects others:

On 12 May 2020, two hundred and twenty five labor organizations signed a letter to Antonin Scalia’s son Eugene Scalia who was Donald Trump’s appointed Secretary of Labor, and it urged his Department to change its policies “that address the standards that apply under the federal U[nemployment] I[insurance] law to determine when workers remain eligible for regular state UI or P[andemic] U[nemployment] A[ssistance] if they leave work or refuse to work due to COVID-19 health and safety concerns.” In more-common language, an economist Jared Bernstein headlined in the Washington Post six days later on May 18th, “The Labor Department is forcing workers back to jobs that could make them sick” and he explained that Scalia’s Department “has issued guidance that virtually ignores health risks and encourages employers to report workers who refuse job offers [while unemployed] so their unemployment payments can be taken away. The agency is busy urging employers to snitch on ‘claimants that have turned down suitable work.’” Trump’s Labor Department ignored the labor-organizations’ letter. Then, a barista headlined at Huffpost on 22 January 2021, “I Work In A Coffee Shop In Montana. Anti-Maskers Have Made My Job Hell.” She complained that the many customers who refused to wear masks were causing her to fear working there — she was blaming those customers, but not Trump. However, Trump and his Labor Secretary were responsible and simply didn’t care about the safety of workers, such as her, and were instead encouraging employers to force these workers to stay on the job, though doing so endangered themselves and their co-workers. Millions of infected workers were infecting others because not to would cause them to become fired and could ultimately force them into homelessness. Maybe the billionaires who funded Trump’s political career profited from such exploitation of their employees, but nationally this policy helped to increase the spreading of Covid-19. Also: since so many of those bottom-of-the-totem-pole employees are Blacks and Hispanics, etc., this Trump policy helped to cause the drastically higher infection-rates that have been reported among such groups.

2. Refusing to deal with the pandemic on a national basis:

On 15 July 2020, the Washington Post headlined “As the coronavirus crisis spins out of control, Trump issues directives — but still no clear plan” and reported that, “health professionals have urged the White House to offer a disciplined and unified national message to help people who are fatigued more than five months into the crisis and resistant to changing social behaviors, such as wearing masks and keeping a distance from others. Trump, for instance, refused to be seen publicly wearing a mask until last weekend, when he sported one during a trip to Walter Reed National Military Medical Center. ‘You can get a really strong and eloquent governor who can help at the state level, but it does seem like we need some more national messaging around the fact that for many people, this is the most adversity they’ve faced in their life,’ said Marcus Plescia, chief medical officer with the Association of State and Territorial Health Officials.” Every country (such as China, Vietnam, Venezuela, South Korea, Thailand, New Zealand, and Finland) that has been far more successful than America is at having a low number of Covid-19 cases (and deaths) per million residents has dealt with the pandemic on a national and not merely local basis, but all of the worst-performing countries (such as America, which now is at 76,407 “Tot Cases/1M pop”) have not.

It therefore also stands to reason that 

which ranks all 50 states according to how high is the number of Covid-19 infections per million inhabitants, shows (and links to the data proving) that “In 2016, the top 17 [most Covid-infected states] voted for Trump, and the bottom 5 voted for Clinton. All but 3 of the top 24 voted for Trump.” The correlation of high Covid-infection-rate with Trump-voting was astoundingly high. Trump, it seems, gave the high-infection-rate states what they had wanted. But what he gave to America is the highest Covid-19 infection-rate of any nation that has at least 11 million population. It is the 7th-highest Covid-19 infection-rate among all 219 reporting nations. Trump’s policies produced the type of results that had been expected by well-informed people around the world.

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