Not only was their economy dropping, but not surprising, they were running significant budget deficits ($21 billion in 2016, or 3% of GDP) and their cash reserves were running low (National Wealth Fund had $72.71 billion as of September 2016). Much of this decline was driven by the price of oil and secondarily, by the limited sanctions imposed by the United States and the European Union (and the counter-sanctions issued by Russia). These sanctions are still in place and the price of oil is not something the Russians have control over. I don’t see the sanctions being lifted anytime soon, so Russian economic growth is dependent as the price of oil staying stable or moving up. Putin is up for re-election to his fourth term in March 2018 for a six-year term, so a stable economy would be helpful, although few doubt the outcome of the election. Growth after a recession can sometimes be strong, for example the U.S. economy grew at 2.5% in 2010 after 18 months negative growth. The Russian recovery at 0.5% is a little anemic.
I gather the reasons are because of a slow down of demand in China (which is interesting in and of itself) and Libyan oil returning to the market (which is a good sign). Brent Crude is now getting near $50 a barrel, whereas several weeks ago it was at $58.
This, of course, has a big impact in countries like Russia, where oil is a major percent of the government budget (ruble is at 57 to a dollar today) and Venezuela, which is currently in turmoil.
Probably doesn’t mean much but 7,000 protestors is a pretty big protest by Russian standards. Still, it appears that the authorities were concerned enough that they put it down quickly with hundreds of arrests (500?). There were times when they were less concerned about opposition. Next presidential election is in 2018.
Kind of mystified why things are suddenly being stirred up in Ukraine. To me, this does not seem to work to Russia’s advantage, as they are trying to convince the new U.S. administration to remove some sanctions. Anyhow a couple of relevant articles:
Ukraine has avoided using Russian natural gas for the last two years
It is now a particularly cold winter there and it appears that they will run out of their own gas by the end of February or mid-March.
Therefore, they will probably have to buy from Russia…but….
They owe Russia $3 Billion that Russia loaned to the ousted Yanukovich regime.
Also Gazprom is claiming from Ukraine:
$32 billion for breach of contract lawsuit.
$5.3 billion owed for a take-or-pay clause in their contract.
Bills for sending gas to the separatist regions of Lugansk and Donetsk.
Ukraine is paid $2 billion a year for the transit of Russian natural gas to the EU.
Russia is trying to bill Ukraine for gas delivered to a separatist movement that Russia supported. I am surprised they are not charging them for building the bridge across the Kerch Strait to Crimea (expected to be operational in 2019).
Suspect the basic nature of U.S. relations with Russia is going to be a issue for while. Note that in early December 27 Senators (12 Republicans and 15 Democrats) sent a letter to Trump: “The senators urged Trump to maintain sanctions against Russia “until key provisions of the Minsk Agreement are met,” and, notably, urges providing “defensive lethal assistance” to Ukraine.”
Earlier this week he was in the Baltic States (which are members of NATO).
The Senate is split 52-48 (Republican/Democrat). It takes only a handful of Republican senators working with the Democrats to influence, modify or overturn something they disagree with that the incoming administration would do. Trump, has indicated a more favorable position relative to Russia, as have several of his advisors like Flynn (nominated National Security Advisor) and Tillerson (nominated Secretary of State). This could end up generating an interesting (perhaps behind the scenes) tug-of-war between the President and Congress over our Russian policy. And then there is also the Russian hacking allegations.
…
P.S. A few more quotes from the early December letter written by 27 Senators:
Almost three years after Russia’s illegal annexation of Crimea and military aggression in eastern Ukraine, daily ceasefire violations along the line of contact make a mockery of the Minsk Agreement and demonstrate that this conflict in the heart of Europe is far from over.
Quite simply, Russia has launched a military land-grab in Ukraine that is unprecedented in modern European history. These actions in Crimea and other areas of eastern Ukraine dangerously upend well-established diplomatic, legal, and security norms that the United States and its NATO allies painstakingly built over decades.
I am not sure I buy into any of it !!!…..but it got my attention.
The argument:
45 years ago Kissinger told Nixon that the next president would have to pivot towards Russia in 20 years.
In effect, he envisioned the United States playing a balance of power role between China and Russia, moving back and forth between the two.
Is this what Trump is doing with his recent negative comments on China and positive comments on Russia?
Factiods that got my attention:
“As a means to block the spread of Soviet influence in Southeast Asia, Carter administration officials approved of the Chinese invasion of Vietnam, which occurred shortly after Deng Xiaoping concluded the first trip of a Chinese leader to the United States in January 1979.” …..Really?
“China’s economy was once a fraction of the Soviet economy; now it’s about five times larger.” …….it is always useful to look at GDP.
More rhyming headlines…sorry. Anyhow, looks like Rex Tillerson, President of Exxon Mobil Corporation has been selected to be our next Secretary of State. Here is his Wikipedia bio: Rex Tillerson
Not much in the bio….he has been with Exxon for 41 years. It appears that this will be his first job since college that is not with Exxon. The most telling things are:
Close ties to Russia and Putin.
Doesn’t like sanctions (not surprising)
Likes free trade (and the TPP)
Suspicious of global warning (not surprising…considering his company)
According to Wikipedia was recommended to Trump by Condoleezza Rice.
Anyhow, nothing really surprising or earthshaking here considering his business. The ties to Russia pose a problem and the hearings should be interesting. This is worth noting: John McCain: Rex Tillerson and Putin
To quote a couple of lines from McCain:
“But Vladimir Putin is a thug, a bully and a murderer, and anybody else who describes him an anything else is lying.”
and
“What about all the other things–right now, the targeting of hospitals by Russian aircraft with precision weapons in Syria, in Aleppo? Those are the kind of questions that we need to ask [Tillerson] about the relationship with Vladimir Putin.”
Senators McCain and Graham have been supportive of Ukraine and hostile to Russia. The Democrats have 48 seats in the Senate. If McCain and Graham were willing to break with the party and break with Trump, and could bring one more Republican senator with them, then they could actually reject Trump’s Secretary of State appointment. I don’t recall that ever happening for a Secretary of State appointment so suspect it is not very likely.
The Syrians appear to be pushing hard to take all of Aleppo before the new U.S. president arrives in office. I suspect this is an attempt to get a negotiating advantage in light of what they perceive to be Trump’s attitudes towards Russia and Syria. According to this report, they have at least 85% of the city: thousands-flee-heavy-aleppo-fighting.
The odd claim is the one made in the second article of this link, where Russia Foreign Minister Lavrov claims about the taking of Palmyra by ISIL that: “…it has been staged to give a respite to bandits in eastern Aleppo.” Of course, one person’s freedom fighters is another person’s bandits.
To take a quote from the first article from Lt. General Townsend: “‘At the start of the campaign, we estimated somewhere between at the low end 3,500, at the high end, about 6,000. By our calculations we think we have killed or badly wounded over 2,000. So if you do the math, that’s still 3,000-5,000’ militants remaining in Mosul, Townsend said.”
We assume he is talking 2,000 killed or seriously enough injured to no be able to return to action in the next couple of months….so, maybe 1,000 killed and 1,000 seriously wounded (kind of grabbing numbers out of thin air here). So, total losses are 4,000 – 6,000 if you count all wounded? That is kind of the entire opposing force.
Then there is the estimates that coalition has lost 14,000 killed and wounded since the start of the offensive (see our post at: Casualties in Iraq (November)). Does that mean that trained conventional counterinsurgency forces are losing something like 2.3-to-1 fighting the insurgents. That would be significant if that was the case.
Something if off somewhere in these various numbers. I not sure which number not to believe (although the estimate of insurgent strength has traditionally always been way too low).
Special Forces (spetsnaz) personnel of the Russian Federation federal agencies receiving awards from Russian President Vladimir Putin during an official reception.
On Russian foreign and military affairs, I have a lot of time for British academic Mark Galeotti. I recommend his work to anyone interested in these topics. An expert on Russian history and government, he is currently a Senior Research Fellow at the Institute of International Affairs Prague, and Principal Director of the consultancy Mayak Intelligence.
In a piece at War on the Rocks, Galeotti acknowledges the traditionally cited sources for Russia’s so-called “hybrid war” approach: its relative post-Soviet economic weakness and a military/political inheritance from the Soviet and Tsarist eras. However, he argues that the Putin government’s approach to foreign and military policy is a reflection of the hybrid nature of the current Russian state:
Today, Russia is a patrimonial, hyper-presidential regime, one characterized by the permeability of boundaries between public and private, domestic and external. As oligarch-turned-dissident Mikhail Khodorkovsky put it:
[W]hat distinguishes the current Russian government from the erstwhile Soviet leaders familiar to the West is its rejection of ideological constraints and the complete elimination of institutions.
Lacking meaningful rule of law or checks and balances, without drawing too heavy-handed a comparison with fascism, Putin’s Russia seems to embody, in its own chaotic and informal way, Mussolini’s dictum “tutto nello Stato, niente al di fuori dello Stato, nulla contro lo Stato” — “everything inside the State, nothing outside the State, nothing against the State.” Parenthetically, Mussolini sent what could be called “little blackshirt men” to Spain in the 1930s to fight on Franco’s side during the civil war. All notionally opted to do so of their own volition (as the Voluntary Troops Corps) and initially without insignia.
In Russia, state institutions are often regarded as personal fiefdoms and piggy banks, officials and even officers freely engage in commercial activity, and the Russian Orthodox Church is practically an arm of the Kremlin. Given all that, the infusion of non-military instruments into military affairs was almost inevitable. Beyond that, though, Putin’s Russia has been characterized — in the past, at least — by multiple, overlapping agencies, a “bureaucratic pluralism” intended as much to permit the Kremlin to divide and rule as for any practical advantages.
Galeotti asserts that the Putin regime believes itself in a “geopolitical, even civilizational struggle” with the West, and its approach to the conflict mirrors the way the regime operates, with “blurring of the borders between state, paramilitary, mercenary, and dupe.”
