Entry 2 – War (second phase)

Things have happened since I wrote the previous note (things always happen), but nothing that can be considered a substantial change in the situation.

I do want to highlight the following:

A news item by omission: There is not much news of problems in Russia with recruiting. If there were, they would tell us about it ad nauseam to show Putin’s weakness. If they don’t, he’s not doing too badly in terms of opposition from his people.

Yes, there is a lot of bad news from the Western economy.
- Inflation continues unchecked.
- All currencies are weakening against the dollar (which does not mean that the dollar does not have problems, but that they will surface later, which I will discuss later).
- These currency weakenings make energy more expensive for Europe, which is not a good thing in the place where there is the greatest need for energy.
- There are serious risks in Credit Suisse and Deutsche Bank (their position in derivatives is 25 times the GDP of Germany, i.e., it is not easy to save them). Risks that, if they materialize, can generate something worse than Lehman Brothers, as can be seen, for example here.

The issue of access to energy in the West is not going well either. In France, the first “rationing” measures have already been approved. They have decided to block digital gas meters in homes for a few hours a day (news here). In the UK they have approved something similar for electricity. This is only the beginning, …and winter has not yet arrived.

It seems that Russia continues to lose some territory. And that, after the referendums and Putin’s statements, is going to consider it invasion of Russian territory. That is, it may feel authorized to use even nuclear weapons.

There has been an attack on the Kerch bridge, which connects Crimea and Russia. It has been disabled. This is a very strong blow to Russia, even morally. And it is in a target a little bit far from the war. It is between the usual Russia, and Crimea (which is Russia since 2014, not by recent annexations). We will see the response, …

In addition, China has predictably done virtually nothing regarding the conflict. I don’t think it will do so until after October 16. And, … I do think it will after that.

I will talk about the:

Putin’s speech last September 21.

I already said in the previous note that it was convenient to read in great detail the complete and literal speech. It gives much more information than what has been in the news. I recommend it to everyone, although it is a bit long.

It is necessary to read the speech with the vision of the target audience, even if we do not share it. It is the vision of the Russian population (with the cultural indoctrination and information it has). For those who want to read it in full, I repeat here the link.

For those who do not want to spend that time, I give them two alternatives. The first is that I have generated another document (link here) where I include the literal speech, but I mark in yellow what I consider more substantial, and I put in red my personal interpretations of what he is saying.

The other alternative is to read only my personal interpretations (without context), which are the following, in order of appearance in the speech:

From the very beginning, it focuses its objectives (Donbas), which it will then repeat a lot. Previously, the objectives were not officialized.

Also from the beginning, he makes it clear that the War started in 2014, as an armed coup d’état, and that it was started by others.

Soon it will further specify its objectives (the Donetsk and Lugansk People’s Republics, and the Kherson and Zaporiyia regions).

The West does not let them be free to do things their own way. And Putin doesn’t like Western values (he calls them pseudo-values).

Of course, Putin does not consider himself at all close to the West (he says they want to weaken and divide Russia). The possibility that Russia would end up being part of the West, albeit with its identity as a country, is completely dismissed.

Ukraine has long been guilty (they have used it as a bridgehead to fuel hatred of Russia).

He uses the word war for the first time, and repeats that it was started by the West in 2014. Russia is defending itself in the liberated territories (in his speech they are just that, not annexed), territories that are clearly Russian, in his understanding.

He makes an ode to patriots, looking for more to emerge, and declares that patriots will be well taken care of.

Our successes are already great (they have a 1,000 km contact line).

Implicitly, it terminates the Special Military Operation. We are now in another phase.

I tried to do it the easy way (a peaceful agreement was reached in Istanbul), but they forced me to do it the hard way. Moreover, I thank Istanbul for collaborating in the attempt: you are not our enemy.

We are not fighting not against Ukraine, but against NATO covertly (which is somewhat true).

It relies on old bad memories (Stepan Bandera).

Referendums are legal, and we have an obligation to protect that part of Russia.

Calling them “liberated territories” speaks volumes. They are not conquests, nor annexations.

Do not panic, it is only partial (the mobilization of troops), and I will treat the mobilized well.

I am warning you that I will nationalize everything that is needed: all of you at the orders of Defense.

It was the West that carried out the bombing of the Zaporiyia nuclear power plant.

Our history of success in defending the country supports us. We will defend it once again, using whatever means necessary, including nuclear weapons.

The above is with respect to the things he says in the speech.

I want to comment a little on the ones it does not say. The omissions. Among them:

The most relevant is the lack of mention of its allies or friends. The war is Russia’s, and if she wins it, the credit goes to her.

We know that he has friends, but he does not involve them, either so as not to harm them (because they do not want to be quoted, which is probably the case in China), or so as not to have to share credit.

The most it does is to say (many times) that its enemy is the West. By exclusion, the rest is not. He also says that the West wants to impose its “pseudo-values on other countries and nations” (there he is looking for partners).

He also makes a mention of Turkey (the only place he cites) to thank them for trying to find peace. With that he tries to weaken the closeness (not so much, but somewhat) of Turkey to the West.

Another important omission is the almost null mention of Duguin’s thesis, that of the ethnic nationality of Eurasia.

The most he says is: “I am addressing all of you, all citizens of our country, people of different generations, ages and ethnicities, the people of our great homeland, all those who are united by the great historical Russia“.

The speech is very populist, and very Russian, but it avoids getting completely involved with Duguin’s ideology (without losing respect for him).

In addition to the omissions, I am struck by the change in his personal attitude towards physical contact with other people. The before and after photographs of the speech reflect a change that is not what one would naturally expect.

It could be for medical reasons, or for security reasons, but it was clear that he was afraid of close physical contact after the several times he has been seen at very large tables.

Now he seems to have lost that fear, and I don’t think his health has improved much, nor his security problems. Rather, I think he has been forced to do something he doesn’t like. I see that as a sign of weakness. Although maybe I’m overreacting in applying the old codes of what was called kremlinology in the past, which was to draw conclusions from parade stagings in the absence of better information.

What is clear, a little explicitly in the speech, and a little implicitly, is that it would agree to stop the war with an agreement whereby it would keep what it calls liberated territories. This is something that, evidently, Ukraine would not like at all, but which, if several circumstances are given (China’s position is fundamental), could be acceptable to the West, which could force Ukraine to accept it by withdrawing its support.

China’s position.

I already expounded in the previous note that what Xi Jinping said is: “Faced with an ever-changing world, era and history, China is willing to strive with Russia to assume the role of great powers and play a guiding role to inject stability and positive energy into a world shaken by social turmoil.”

It is clear that, with these words, China is not expressly opposing the West (as Putin does), but is willing to collaborate with Russia in managing the power of the changing world.

China has repeatedly said that it respects the territorial integrity of countries, and international agreements. The truth is that, with respect to those two issues, it can be said that it complies with them much better than the West, not only in this War, but in almost all the events of decades.

As for territorial integrity, someone may say that China does not respect it because of the Taiwan issue. To that, the answer is twofold: on the one hand, China has not done anything military against Taiwan (for now), and on the other hand, China considers Taiwan to be China, so it would not be interfering against territorial integrity (actually, it is the same case of Russia with the Donbas).

China recognizes itself as essential (it is), and positions itself as the “good man” to mediate.

We have also seen that, a little later, the spokesman of the Chinese Foreign Ministry, Wang Wenbin, called on “the relevant parties to reach a ceasefire through dialogue“. Some have seen this as a criticism of Putin. I see it as a preamble to the offer to mediate for peace.

To me it sounds like China doesn’t want War, but it does want there to be a new world power sharing after which, China (and Russia) won’t break any international rules if they try to do things on their territory differently than the West likes.

India

I have already commented that, at the Samarkand meeting, Indian Prime Minister Narendra Modi told Putin that “now is not the time for wars.”

This has been interpreted in the Western press as a slap on the wrist to Putin. And it may well be.

It can also be the scenography of an agreement whereby:

Putin becomes “brute” before the West (he puts fear with nuclear war, and pressure with the economy, because of inflation caused by energy shortages);
India puts the friendly face to the West (although it does energy business with Putin, and even resells later to the West);
And China ends up making the peace negotiating proposal.
OPEC can also be added to this pressure on the West, with its lower production, which means higher oil prices, i.e. higher inflation in the West.

We will have to wait to see how India’s position evolves to know which of the two cases we are in.

USA and Europe.

The US is very nervous. It talks a lot about nuclear war. It says it is the most risky time since the Cuban missiles. This, being true, means they are “preparing the audience”.

Of course they don’t like to get into that kind of war, but, in the meantime, they are benefiting economically within the West. Not that they are doing well (they also have inflation problems), but they are doing better than Europe. That is because of the strength of the dollar and because energy is traded in dollars, as well as because they do not have energy shortages.

There are even those who say that the attack against the Nord Stream pipeline was carried out by the USA, with the primary objective of accusing Russia (false flag attack), and the secondary objective of economically weakening Europe in the power sharing within the West.

For the same reasons, Europe is in a very bad way. There are serious risks of division of opinion between and within countries. Supporting the continuation of the war is becoming increasingly difficult.

What matters most to the US is to know China’s real position, which Xi Jinping will not say until after October 16.

The US knows that, if China does not support Russia, and if Europe does not withdraw from the war, it is very likely to win. But it also knows that, if China supports Russia, it is more likely to lose, even more so if Europe withdraws.

It seems that everyone is on edge and waiting for China.

Meanwhile, in this state of nerves, there is a risk of someone making a mistake with catastrophic results.

Nuclear risk.

There is much discussion about the risk of nuclear weapons being used.

The first thing to say is that, if someone has any weapon and finds himself in the “convenience of using it”, it is normal for him to do so. It is true that the main function is dissuasive (that nobody wants to confront him for having that weapon), but it is also true that the possibility of using it always exists.

Of course, it costs a lot of money to create and maintain these weapons. It is not normal to accept losing a war without considering using them.

It is also true that the answer scares anyone (Armageddon). It is something to consider long before using it.

The critical issue here is what I said above about the convenience of using it. The convenience, or not, will be decided by the user, that is to say, it is his convenience. And he will decide it with his criteria (whether we like them or not). Criteria that can be those of the good of the world, of his country, or of his person. And, if they are those of the person (Putin), it is not out of the question that he will say: “if I have to lose, I don’t care if the world ends with me”.

On the other hand, there is a lot of talk about the concept of “tactical nuclear weapons”. They mean small bomb and not triggering total nuclear war. Of course this is possible, and they seem to be preparing us psychologically for it.

In this case, that of tactical weapons, it is also possible that they may be used as a false flag attack. Let the USA launch it saying that Russia has done it to seek the world’s rejection of Russia.

Another thing that cannot be ruled out is to avoid the image of having used these weapons, but to seek the same result. This would be the case of forcing the explosion of nuclear power plants.

In any case, in addition to the decision to use weapons by whomever (Putin), you need the support of all those who have to participate in the process. If you get insurrection, or sabotage, the launch does not happen. It is certain that all the secret services of the world will be working on trying to force those sabotages, they will be trying to convince or buy somebody.

We know something (also not so much) about the systems of applying that decision in the USA, but we know very little about the Russian ones. I came across an interesting video about that (you can watch it here). It turns out that decisions about nuclear weapons have to go through whoever physically holds them, which is the 12th Directorate of the Ministry of Defense (12 GU MO). One possibility is that they may not end up being blindly loyal to Putin.

I repeat what I have already said several times. I don’t think Putin will make that decision before he knows China’s final position.

China’s offer.

After all that has been said, if Xi Jinping renews his mandate at the October 16 congress, I believe he will make his decision on how to act in the face of the War, … although he does not have to make it public.

That decision can be simplified into support for the West, or for Russia, or indifference (let them fight among themselves without doing anything special in favor of either).

Based on what I have stated so far, and China’s usual way of acting, if I were Xi Jinping, I would try to seek a middle ground but not a warmongering position. Without breaching any international treaties, but seeking a peace useful for China and acceptable to everyone else. It would be something like if China makes a statement saying:

The West is right that world peace must be protected and international treaties respected.

Russia is right that the West does not let us run our countries our way.

The West has serious economic problems to which it must pay attention. The war accentuates these problems, and a peace without a solution to their energy supplies is no good for them.

China proposes:
- Let us make the pacts for the new world order (the new Yalta conference).
- Let us create a two-bloc world, with China leading one (in which Russia participates), and the USA leading the other.
- China is in charge of controlling Russia and convincing it to stop the war. In other words, China makes a pact with Russia for its strength within its bloc, and Russia considers itself calm and a winner, as well as authorized to do things in its own way (different from the Western way).
- The Chinese bloc guarantees a transition period to the Western bloc to “dismantle” the old globalization.
  
  It would be a long time (20 years?), during which the trade of energy, cereals and other raw materials would be guaranteed between the blocs, but with agreements for their gradual decrease. This would put an end to the West’s current economic problems.
  
  In the same time frame, the business investments of each block in the other would be dismantled. It is time to amortize or sell them.
- And, almost the most difficult, let’s agree on the borders between the blocs (Ukraine, Taiwan, …). For this you can propose non-cheating referendums in each place, and do what the people want.
  
  In the case of Taiwan, it may propose something similar to Hong Kong (a very long time for a gradual incorporation).
  
  In any case, the population and companies would be given time and facilities to make their decisions to change blocks if they do not like the result.

I would not be surprised if they do something similar. Of course, with much more diplomatic and sophisticated language, and contemplating many details.

If they do, the response of each party would have to be seen.

Surely, Russia will be satisfied (if it keeps the Donbas and the freedom to act).

Europe would accept it. Above all, if it is given some priority in the supply of energy and cereals from the Chinese block in comparison with the USA, and some respect (it would be the way to “buy it”). Europe cannot win the war without the USA, and it will be economically devastated, even if the USA wins it. It could benefit from being part of the US bloc, but the part that gets along with the Chinese bloc (the one that manages inter-bloc trade).

The USA would not like it at all, but without the support of Europe and China, it would find it difficult to continue the war. And, with economic solutions and freedom to act in its bloc, it could be somewhat satisfied.

China, without having been involved in the war, would go on to formalize its global relevance. It could continue with its way of understanding society. And it would have time to change its customers and suppliers in the West for new ones in its own bloc, or in Asia, Africa, …

Ukraine would be very sad and dissatisfied, but if there is peace and reconstruction commitments on both sides, it could accept it, especially if no one supports it to continue.

If, in the end, their proposal is not heeded, China remains open to the possibility of supporting Russia, the West, or remaining indifferent.

Very soon we will see what happens.

That is as far as I have gone for today. In subsequent notes I will discuss what has happened in the meantime, as well as the situation in Europe, which is very weakened by energy and the dollar, as well as the fact that the dollar’s strength may only be transitory.