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US mulls further sanctions on Russia; all of which however look counter-productive

Ambassador Huntsman says US preparing report on sanctions; no decision taken or expected soon on further sanctions

Alexander Mercouris

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Jon Huntsman, the new ambassador to Russia who President Donald Trump has appointed, has downplayed the prospect of further sweeping sanctions against Russian companies and businesspeople being announced by the US on 29th January 2018.

Ambassador Huntsman instead says that only a report will be published on that day

The date when additional U.S. sanctions may be imposed on Russian individuals and companies has not been set, while January 29 is the date of publishing the ‘Kremlin report’, U.S. Ambassador to Russia Jon Huntsman told reporters on Tuesday.

The media has reported the possibility of new sanctions but all that has been happening so far is the implementation of the law, there is nothing new, Huntsman said.

The law Ambassador Huntsman is referring to is the new sanctions law voted by Congress in August and signed under protest by President Trump that month.

There has been much secrecy about this report, which the law specifies must be published by 29th January 2018.  Latest reports say that a list is being drawn up of 300 businesspeople and companies who are to be placed on a new sanctions list.

As I have discussed previously, additional sanctions against individual Russian businesspeople and companies might cause serious problems for the businesspeople and companies concerned but they will have little or no impact on the Russian economy overall.  On the contrary if they lead to more Russian businesspeople and companies keeping their money in Russia they will serve the Kremlin’s interests.

However there have been rumours that the US is considering more sweeping sanctions targeting not just individual businesspeople and companies but the entire Russian economy.  Three sorts of such sanctions have been mentioned

(1) Cutting off Russian banks from the SWIFT interbank payment system;

(2) Freezing Russian gold and foreign currency reserves held in the US; and

(3) Prohibiting US investors from buying Russian sovereign debt.

What are the prospects of any of these sanctions being imposed?

The first thing to say is that all three of these sanctions would be exceptionally aggressive steps, which would send shockwaves across the international financial system.  Countries like China which also have issues with the US – and which the US is now also threatening with sanctions in connection with the North Korean crisis – would almost certainly interpret such moves as a long term threat to themselves.

Implementing actions of this sort would over time only hasten moves by countries like China and Russia to set up alternative international financial institutions of their own.  That would undermine the US led ‘globalisation’ of the international financial system.  Since the US is the principal beneficiary of this system implementing these sort of sanctions would hardly be in the US’s own long term interests, which is of course precisely why such sanctions were not imposed on Russia at the peak of the Ukrainian crisis in 2014.

Assuming however that in the current hysterical atmosphere there really are proposals to impose these sanctions on Russia, what would their consequences be?

(1) Disconnecting Russian banks from SWIFT

The first point to make about this proposal is that the US does not have the power to impose it unilaterally.  SWIFT is based in Brussels, not the US, and is regulated by EU law, not US law.  The US government is not in a position simply to order that Russian banks be disconnected from SWIFT.

As it happens it is known that the Obama administration and the British government did actively lobby for Russian banks to be disconnected from SWIFT back in 2014.  However they ran into a wall of opposition both from SWIFT itself and from European governments, with the German and Austrian governments especially strongly opposed.

There is no indication that such a proposal is being seriously debated at this time in European capitals, which makes it unlikely that it is being considered.

However assuming that it is being considered, what would its effect be?

US and British politicians who have lobbied for Russian banks to be disconnected from SWIFT seem to think this is some of ‘magic bullet’ or ‘nuclear option’ which would tip the whole Russian economy into crisis, but is this really so?

There is a huge amount of mystification about SWIFT.  However ultimately it is nothing more than an electronic transfer system which banks use in order to transfer money between each other.

Banks could transfer money between each other before SWIFT appeared.  I can remember a time not so long ago when most money transfers between banks did not use SWIFT.

The fact that SWIFT is an electronic transfer system means that it can be duplicated, and that is exactly what the Russians have reportedly done.

Back in 2014 the disconnection of Russian banks from SWIFT would indeed have been a heavy blow because Russian banks used SWIFT to transfer money between each other within Russia itself.

However the reports that the US and Britain were lobbying for Russian banks to be disconnected from SWIFT caused the Russian Central Bank to create its alternative to SWIFT as a back up system.

Not only does this system apparently already exist, but it has apparently been field tested, though for the moment it is not in actual operation because of the continued availability of SWIFT.

Most probably most Russian banks and bank branches are not yet connected to this alternative system.  However if Russian banks really were disconnected from SWIFT the alternative system would not only be rapidly brought into operation but priority would be given to extending it across the whole Russian banking system.

Doubtless there would be a period of disruption, but a country like Russia has the technological and administrative resources to solve that sort of problem, and I suspect doing so would take no more than a few months.

Russian banks would of course still be prevented from making electronic transfers via SWIFT to Western banks.  However the impact of this can be exaggerated.

Since 2014 the big state owned Russian banks which account for 70% of the Russian banking system and an even higher proportion of the foreign operations undertaken by Russian banks have been effectively cut off from borrowing in Western financial markets.  Their foreign based customers would no doubt suffer if they were disconnected from SWIFT, but it is unlikely the big state owned banks would themselves be seriously affected.

Which brings me back to the main objection to cutting off Russian banks from SWIFT.  Many of the bank customers who would be most seriously affected are Western companies and businesspeople with investments in Russia.

With trade between Russia and Western European actually increasing over the last few months, many European businesspeople and companies would be very seriously affected.

Not only would that hurt them badly but some of these are influential people and companies who would be likely to complain.  That of course is why the decision was taken back in 2014 not to disconnect Russian banks from SWIFT in the first place.

Overall disconnecting Russian banks from SWIFT looks neither like a magic bullet nor like something that European business would willingly accept.  Frankly the political and financial costs of doing it look greater than any conceivable benefit.

(2) Freezing Russian gold and foreign currency reserves

Since this would be tantamount to seizing the sovereign property of the Russian state it would unquestionably be illegal and would as Russian officials have said be equivalent to an act of war.  However the US has shown an increasing willingness to take illegal actions and it is unlikely that the fact that this step is illegal would be enough to deter it.

If the US did take this step what would its economic impact be?

Russia does keep some of its foreign currency reserves in the US with the IMF, but it is not clear how great the amount is and claims that it is as much as a third of the reserves is probably a wild overstatement.

There is no doubt that such a step would have a serious impact, causing the value of the rouble to fall, at least for a short time.

However Russia runs a trade surplus and has paid off most of its foreign debt and the Central Bank since 2014 has been letting the rouble float.

The economy would swiftly adjust as it did to the crisis of 2014, with the Russian trade surplus growing still further as Russia’s trade position benefitted from the rouble’s fall and from the surge in oil prices which would be likely follow such a measure.

Doubtless inflation in Russia would be higher, though it would be unlikely to go as high as it did during the inflation spike of 2015.  However the political impact of the increase in inflation within Russia would be mitigated with the Russian government in a position to blame the US for causing it.  Besides as happened following the inflation spike of 2015, once the economy adjusted inflation would fall back again.

If freezing the Russian state’s foreign currency reserves in the US would only have a short term impact on the Russian economy, it would nonetheless constitute a colossal shock across the world financial system.

It would show that the US is prepared to abuse its position at the core of the world financial system and as the host of institutions such as the IMF to target not just the financial reserves of the smaller economies such as Libya, Venezuela or Iran but also the reserves of big G20 economies such as Russia.

The Chinese especially – who have been on the receiving end of similar threats against their reserves for some time – would be horrified.

It would be difficult to imagine any step the US might take that would be more likely to galvanise countries like China and Russia to set up their own alternatives to the current US dominated world financial system and to its various institutions which have historically been under the control of the US.  Such moves are already underway and following the freezing (ie. seizure) of whatever proportion of Russia’s reserves are on US territory that process would be bound to accelerate.

It is impossible to see how that would benefit the US.

(3) Prohibiting US investors from buying Russian sovereign debt

In my opinion this is by far the most likely of any further sectoral sanctions the US might introduce.  It is the one further sectoral sanction the Democratic Senators who published the recent report about Russia which I discussed in a recent article have actually recommended

The U.S. Treasury Department is required to report in early 2018 on the possible effects on Russia’s economy of sanctions on sovereign debt, which could have the potential to foreclose external sources of funds. While the head of Russia’s central bank believes that ‘‘there won’t be any seriously negative consequences’’ from such sanctions, economists have warned that such sanctions ‘‘may totally stop other foreign investors, not the U.S. investors only, from buying the new government debt, fiercely pushing up borrowing costs for Russia.”

This sanction would also almost certainly be illegal but as I have said in my previous discussion of the proposals to freeze whatever foreign currency reserves the Russian state has located on US territory (see (2) above) that no longer seems to be a significant constraint on US actions.

It would however only be a limited sanction.  The US cannot prevent Russia from floating bonds in the international money markets – in Asia if not in Europe – and the Democratic Senators’ assumption that prohibiting US investors from buying such bonds will dissuade other international investors from doing so is also almost certainly wrong (the cited authority for the claim are not ‘economists’ but two articles in Bloomberg Markets).

The problem anyway is that with Russia now expected to run a budget surplus next year, and with Russia’s trading position also in healthy surplus, and with Russia’s gold and foreign currency reserves now standing at more than $430 billion and growing, it is not obvious that Russia needs to borrow at all.

Unless this measure is combined with a freezing of Russian gold and foreign currency reserves, it is difficult to see how this could be more than a pinprick, just as the Democratic Senators report Russian Central Bank Chair Nabiullina saying..

However if the US were to freeze Russian gold and foreign currency reserves this step would not be necessary anyway, since US investors would not want to buy Russian foreign debt in those circumstances if the Russian reserves were frozen.

At that point of course the US would be facing all the consequences outlined in (2).

Needless to say, if US investors were prohibited from buying Russian debt but no action was taken against Russia’s reserves, then the US would simply be forcing its own investors to forego an opportunity to make money by buying into a strong financial asset which was being bought by other international investors elsewhere.

Again it is not obvious how this would benefit the US.

Summary

What all these proposals in common is that they highlight is the simple fact that the sectoral sanctions which were imposed by the West on Russia in 2014 have failed.

The sanctions did not break the Russian economy, or cause a popular revolution in Russia, or lead to an oligarchs’ coup against Putin – all things their advocates variously predicted would happen because of them.

Nor have they achieved their stated person, which is to force Russia to change its policies towards Ukraine.  Even the Democratic Senators in their recent report very grudgingly admit as much

Sanctions Pressure Has Been Insufficient: U.S. and EU sanctions have not resulted in the implementation of the Minsk Agreements nor the return of Crimea to Ukrainian control.  The Russian government appears to have been able to resist this pressure because the cost imposed by sanctions has been manageable.

The trouble is that faced with this simple fact the advocates in the US and elsewhere of more confrontation with Russia refuse to learn the lesson that sanctions against Russia do not work.

Instead they demand more and more sanctions of a sort which were rejected in 2014 when the original sanctions were imposed precisely because they are the sort of sanctions that over the long term are more likely to cause harm to the US and the West than they are to Russia.

The key point is that the Russian economy is many orders of magnitude bigger and more sophisticated than the sort of economies – such as those of Cuba, Iran, Iraq, Libya, North Korea and Venezuela – upon which the US has imposed sanctions previously.  Applying the supposed lessons of the impact of sanctions on those economies in the case of Russia makes no sense, even if those lessons had been learnt correctly, which they have not. Unlike all those economies Russia’s economy is far bigger, already possessing the technology, capital and resources it needs to develop autonomously.

As a self-sufficient continental economy sanctions on Russia almost by definition can have only a limited impact, and one which over time must diminish anyway.

As it happens the most effective sanctions the West could have imposed on Russia, both in terms of their impact on the Russian economy and their limited impact on the economies of the West, were the sectoral sanctions which were imposed in 2014.

Those sanctions did stop for a time the flow of capital from the West into Russia at a time when Russia was facing heavy debt repayments and when the price of its main export products – oil and gas – was collapsing.  The result was to deeper the recession caused by the collapse of oil and gas prices whilst further lowering the value of the rouble in a way which intensified the inflation spike.

With oil prices now rising, most short term Russian foreign debt repaid, and with the rouble floating, none of the sanctions discussed in this article look like they can have anything like the impact on Russia that the sanctions imposed in 2014 did.

The fact that the Russian economy successfully – in fact almost effortlessly – adjusted to those sanctions despite the difficult conditions ought to serve as a warning that further sanctions against Russia will not work, and if they are of the sort discussed in this article are counter-productive.

Jon Huntsman’s comments may suggest that there are people in the US who understand this, and that the demands of those who want ever more confrontation on this occasion are unlikely to be followed.

However the lesson of the last few decades is that to expect rational decision making in Washington especially on the subject of Russia is to expect altogether too much.

One way or the other the next few weeks will show the direction decisions in Washington are taking.

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May Forces Brexit Betrayal to its Crisis Point

We’re 29 months later and the U.K. is no closer to being out of the EU than the day of the vote. 

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Authored by Tom Luongo:


The only words that were left out of Theresa May’s announcement of achieving Cabinet approval over her Brexit deal were Mission Accomplished.

Theresa May was put in charge of the U.K. to betray Brexit from the beginning.  She always represented the interests of the European Union and those in British Parliament that backed remaining in the EU.

No one in British ‘high society’ wanted Brexit to pass.   No. One.

No one in Europe’s power elite wanted Brexit to pass.  No. One.

No one in the U.S.’s power elite wanted Brexit to pass.  No. One.

When it did pass The Davos Crowd began the process of sabotaging it.  The fear mongering has done nothing but intensify.  And May has done nothing but waffle back and forth, walking the political tight rope to remain in power while trying to sell EU slavery to the both sides in British Parliament.

We’re 29 months later and the U.K. is no closer to being out of the EU than the day of the vote.  Why?

Because Theresa May’s 585 page ‘deal’ is the worst of all possible outcomes.  If it passes it will leave the EU with near full control over British trade and tax policy while the British people and government have no say or vote in the matter.

It’s punishment for the people getting uppity about their future and wanting something different than what had been planned for them.

Mr. Juncker and his replacement will never have to suffer another one of Nigel Farage’s vicious farragoes detailing their venality ever again.  YouTube will get a whole lot less interesting.

It’s almost like this whole charade was designed this way.

Because it was.

May has tried to run out the clock and scare everyone into accepting a deal that is worse than the situation pre-Brexit because somehow a terrible deal is better than no deal.  But, that’s the opposite of the truth.

And she knows it.  She’s always known it but she’s gone into these negotiations like the fragile wisp of a thing she truly is.

There’s a reason I call her “The Gypsum Lady.” She’s simply the opposite of Margaret Thatcher who always knew what the EU was about and fought to her last political breath to avoid the trap the U.K. is now caught in.

The U.K. has had all of the leverage in Brexit talks but May has gone out of her way to not use any of it while the feckless and evil vampires in Europe purposefully complicate issues which are the height of irrelevancy.

She has caved on every issue to the point of further eroding what’s left of British sovereignty.  This deal leaves the U.K. at the mercy of Latvia or Greece in negotiating any trade agreement with Canada.  Because for a deal between member states to be approved, all members have to approve of it.

So, yeah, great job Mrs. May.  Mission Accomplished.  They are popping champagne corks in Brussels now.

But, this is a Brexit people can be proud of.

Orwell would be proud of Theresa May for this one.

You people are leaving.  Let the EU worry about controlling their borders.  And if Ireland doesn’t like the diktats coming from Brussels than they can decide for themselves if staying in the EU is worth the trouble.

The entire Irish border issue is simply not May’s problem to solve.  Neither is the customs union or any of the other stuff.  These are the EU’s problems.   They are the ones who don’t want the Brits to leave.

Let them figure out how they are going to trade with the U.K.  It is so obvious that this entire Brexit ‘negotiation’ is about protecting the European project as a proxy for the right of German automakers to export their cars at advantageous exchange rates to the U.K. at everyone’s expense.

Same as it was in the days of The Iron Lady.

If all of this wasn’t so predictable it would be comical.

Because the only people more useless than Theresa May are the Tories who care only about keeping their current level of the perks of office.

The biggest takeaway from this Brexit fiasco is that even more people will check out of the political system. They will see it even more clearly for what it is, an irredeemable miasma of pelf and privilege that has zero interest in protecting the rights of its citizens or the value of their labor.

It doesn’t matter if it’s voter fraud in the U.S. or a drawn out betrayal of a binding referendum. There comes a point where those not at the political fringes look behind the veil and realize changing the nameplate above the door doesn’t change the policy.

And once they realize that confidence fails and systems collapse.

Brexit was the last gasp of a dying empire to assert its national relevancy.  Even if this deal is rejected by parliament the process has sown deep divisions which will lead to the next trap and the next and the next and the next.

By then Theresa May will be a distant memory, being properly rewarded by her masters for a job very well done.


Please support the production of independent and alternative political and financial commentary by joining my Patreon and subscribing to the Gold Goats ‘n Guns Investment Newsletter for just $12/month.

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The DOJ Is Preparing To Indict Julian Assange

Ecuador’s relationship with Assange has deteriorated considerably with the election of President Lenin Moreno.

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Via Zerohedge…


The US Justice Department is preparing to indict WikiLeaks founder Julian Assange which, after sensitive international negotiations, would likely trigger his extradition to the United States to stand trial, according to the Wall Street Journalciting people in Washington familiar with the matter.

Over the past year, U.S. prosecutors have discussed several types of charges they could potentially bring against Mr. Assange, the people said. Mr. Assange has lived in the Ecuadorean embassy in London since receiving political asylum from the South American country in 2012.

The people familiar with the case wouldn’t describe whether discussions were under way with the U.K. or Ecuador about Mr. Assange, but said they were encouraged by recent developments.

The exact charges Justice Department might pursue remain unclear, but they may involve the Espionage Act, which criminalizes the disclosure of national defense-related information. –WSJ

In short, the DOJ doesn’t appear to have a clear charge against Assange yet. Then there’s the optics of dragging Assange out of Ecuador’s London Embassy and into the United States, then prosecuting him, and if successful – jailing him.

Prosecuting someone for publishing truthful information would set a terrible and dangerous precedent,” said Assange lawyer Barry Pollack – who says he hasn’t heard anything about a US prosecution.

“We have heard nothing from authorities suggesting that a criminal case against Mr. Assange is imminent,” he added.

Moreover, assuming that even if the DOJ could mount a case, they would be required to prove that Russia was the source of a trove of emails damaging to Hillary Clinton that WikiLeaks released in the last few months of the 2016 election.

An indictment from special counsel Robert Mueller that portrayed WikiLeaks as a tool of Russian intelligence for releasing thousands of hacked Democratic emails during the 2016 presidential campaign has made it more difficult for Mr. Assange to mount a defense as a journalist. Public opinion of Mr. Assange in the U.S. has dropped since the campaign.

Prosecutors have considered publicly indicting Mr. Assange to try to trigger his removal from the embassy, the people said, because a detailed explanation of the evidence against Mr. Assange could give Ecuadorean authorities a reason to turn him over. –WSJ

It’s no secret that Assange and Hillary Clinton aren’t exactly exchanging Christmas cards, however would WikiLeaks’ release of damaging information that was hacked (or copied locally on a thumb drive by a well-meaning American), be illegal for Assange as a publisher?

Despite scant clues as to how the DOJ will prosecute Assange aside from rumors that it has to do with the Espionage Act, the US Government is cooking on something. John Demers – head of the DOJ’s national security division, said last week regarding an Assange case: “On that, I’ll just say, we’ll see.”

The U.S. hasn’t publicly commented on whether it has made, or plans to make, any extradition request. Any extradition request from the U.S. would likely go to British authorities, who have an outstanding arrest warrant for Mr. Assange related to a Swedish sexual assault case. Sweden has since dropped the probe, but the arrest warrant stands.

Any extradition and prosecution would involve multiple sensitive negotiations within the U.S. government and with other countries. –WSJ

Beginning in 2010, the Department of Justice beginning under the Obama administration has drawn a distinction between WikiLeaks and other news organizations – with former Attorney General Eric Holder insisting that Assange’s organization does not deserve the same first amendment protections during the Chelsea Manning case in which the former Army intelligence analyst was found guilty at a court-martial of leaking thousands of classified Afghan War Reports.

US officials have given mixed messages over Assange, with President Trump having said during the 2016 election “I love WikiLeaks,” only to have his former CIA Director, Mike Pompeo label WikiLeaks akin to a foreign “hostile intelligence service” and a US adversary. Former Attorney General Jeff Sessions has said that Assange’s arrest is a “priority.”

Ecuador’s relationship with Assange, meanwhile, has deteriorated considerably with the election of President Lenin Moreno – who called the WikiLeaks founder a “stone in our shoe,” adding that Assange’s stay at the London embassy is unsustainable.

Ecuador has been looking to improve relations with the U.S., hosting Vice President Mike Pence in 2018 amid interest in increasing trade.

Ecuador’s Foreign Relations Ministry declined to comment. This month, Foreign Relations Minister José Valencia told a radio station the government hadn’t received an extradition request for Mr. Assange.

Mr. Assange has clashed with his Ecuadorean hosts in over internet access, visitors, his cat and other issues. Last month, he sued Ecuador over the conditions of his confinement. At a hearing last month, at which a judge rejected Mr. Assange’s claims, Mr. Assange said he expected to be forced out of the embassy soon.  –WSJ

Assange and Ecuador seem to have worked things out for the time being; with his months-long communication blackout mostly lifted (with strict rules against Assange participating in political activities that would affect Ecuador’s international relations). Assange is now allowed Wi-Fi, but has to foot the bill for his own phone calls and other communication.

In October, a judge threw out a lawsuit Assange filed against Ecuador from implementing the stricter rules,.

“Ecuador hasn’t violated the rights of anyone,” Attorney General Íñigo Salvador said after the court ruling. “It has provided asylum to Mr. Assange, and he should comply with the rules to live harmoniously inside Ecuador’s public installations in London.”Assange’s attorneys say he will appeal the ruling – however it may be a moot point if he’s dragged into a US courtroom sooner than later.

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Trump Understands The Important Difference Between Nationalism And Globalism

President Trump’s nationalism heralds a return to the old U.S. doctrine of non-intervention.

The Duran

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Authored by Raheem Kassam, op-ed via The Daily Caller:


President Macron’s protests against nationalism this weekend stand in stark contrast with the words of France’s WWII resistance leader and the man who would then become president: General Charles de Gaulle.

Speaking to his men in 1913, de Gaulle reminded them:

“He who does not love his mother more than other mothers, and his fatherland more than other fatherlands, loves neither his mother nor his fatherland.”

This unquestionable invocation of nationalism reveals how far France has come in its pursuit of globalist goals, which de Gaulle described later in that same speech as the “appetite of vice.”

While this weekend the media have been sharpening their knives on Macron’s words, for use against President Trump, very few have taken the time to understand what really created the conditions for the wars of the 20th century. It was globalism’s grandfather: imperialism, not nationalism.

This appears to have been understood at least until the 1980s, though forgotten now. With historical revisionism applied to nationalism and the great wars, it is much harder to understand what President Trump means when he calls himself a “nationalist.” Though the fault is with us, not him.

Patriotism is the exact opposite of nationalism: nationalism is a betrayal of patriotism … By pursuing our own interests first, with no regard to others,’ we erase the very thing that a nation holds most precious, that which gives it life and makes it great: its moral values,” President Macron declared from the pulpit of the Armistice 100 commemorations.

Had this been in reverse, there would no doubt have been shrieks of disgust aimed at Mr. Trump for “politicizing” such a somber occasion. No such shrieks for Mr. Macron, however, who languishes below 20 percent in national approval ratings in France.

With some context applied, it is remarkably easy to see how President Macron was being disingenuous.

Nationalism and patriotism are indeed distinct. But they are not opposites.

Nationalism is a philosophy of governance, or how human beings organize their affairs. Patriotism isn’t a governing philosophy. Sometimes viewed as subsidiary to the philosophy of nationalism, patriotism is better described as a form of devotion.

For all the grandstanding, Mr. Macron may as well have asserted that chicken is the opposite of hot sauce,so meaningless was the comparison.

Imperialism, we so quickly forget, was the order of the day heading into the 20th century. Humanity has known little else but empire since 2400 B.C. The advent of globalism, replete with its foreign power capitals and multi-national institutions is scarcely distinct.

Imperialism — as opposed to nationalism — seeks to impose a nation’s way of life, its currency, its traditions, its flags, its anthems, its demographics, and its rules and laws upon others wherever they may be.

Truly, President Trump’s nationalism heralds a return to the old U.S. doctrine of non-intervention, expounded by President George Washington in his farewell address of 1796:

” … It must be unwise in us to implicate ourselves, by artificial ties, in the ordinary vicissitudes of [Europe’s] politics, or the ordinary combinations and collisions of her friendships or enmities.”

It should not have to be pointed out that the great wars of the 20th century could not be considered “ordinary vicissitudes”, but rather, that imperialism had begun to run amok on the continent.

It was an imperialism rooted in nihilism, putting the totality of the state at its heart. Often using nationalism as nothing more than a method of appeal, socialism as a doctrine of governance, and Jews as a subject of derision and scapegoating.

Today’s imperialism is known as globalism.

It is what drives nations to project outward their will, usually with force; causes armies to cross borders in the hope of subjugating other human beings or the invaded nation’s natural resources; and defines a world, or region, or continent by its use of central authority and foreign capital control.

Instead of armies of soldiers, imperialists seek to dominate using armies of economists and bureaucrats. Instead of forced payments to a foreign capital, globalism figured out how to create economic reliance: first on sterling, then on the dollar, now for many on the Euro. This will soon be leapfrogged by China’s designs.

And while imperialism has served some good purposes throughout human history, it is only when grounded in something larger than man; whether that be natural law, God, or otherwise. But such things are scarcely long-lived.

While benevolent imperialism can create better conditions over a period of time, humanity’s instincts will always lean towards freedom and self-governance.

It is this fundamental distinction between the United States’ founding and that of the modern Republic of France that defines the two nations.

The people of France are “granted” their freedoms by the government, and the government creates the conditions and dictates the terms upon which those freedoms are exercised.

As Charles Kesler wrote for the Claremont Review of Books in May, “As a result, there are fewer and fewer levers by which the governed can make its consent count”.

France is the archetypal administrative state, while the United States was founded on natural law, a topic that scarcely gets enough attention anymore.

Nationalism – or nationism, if you will – therefore represents a break from the war-hungry norm of human history. Its presence in the 20th century has been rewritten and bastardized.

A nationalist has no intention of invading your country or changing your society. A nationalist cares just as much as anyone else about the plights of others around the world but believes putting one’s own country first is the way to progress. A nationalist would never seek to divide by race, gender, ethnicity, or sexual preference, or otherwise. This runs contrary to the idea of a united, contiguous nation at ease with itself.

Certainly nationalism’s could-be bastard child of chauvinism can give root to imperialistic tendencies. But if the nation can and indeed does look after its own, and says to the world around it, “these are our affairs, you may learn from them, you may seek advice, we may even assist if you so desperately need it and our affairs are in order,” then nationalism can be a great gift to the 21st century and beyond.

This is what President Trump understands.

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