The week that ushered in new Cold War


M. K. Bhadrakumar

Jul. 29, 2014


If future historians were to pinpoint the transition when the post-cold war era morphed into the new Cold War, they are bound to take a close look at this week. The Barack Obama administration is in a triumphalist mood after the success, finally, in rallying the US’s major European allies — UK, France, Germany and Italy — behind its concerted strategy to isolate Russia from Europe and impose biting sanctions against it.

Obama could have made a stirring Iron Curtain speech this week — but for the mess-up in Libya, Iraq, Syria, Afghanistan, et al, and the horrendous massacre in Gaza that has marred his own reputation, and, besides, don’t forget, he’s a Nobel and is not supposed to give a war cry.

All the same, Obama’s video teleconference Monday with his European counterparts signifying the agreement on “coordinated sanctions measures on Russia” suggests beyond doubt that the post-cold war era is ending.

Within the next “12-48 hours” Brussels will be announcing new sanctions against Moscow based on the US blueprint involving a broad package of measures aimed at bringing the Russian economy to its heels. Washington will thereupon announce its own sanctions against Russia.

These so-called Tier Three sanctions are expected to hit Russia’s financial institutions, arms deals and energy exploration technology. The Russian banks will be barred from listing new bond or equity issues on European Exchanges and there will be ban on transfer of sensitive technologies that could be used in deep-sea drilling, arctic exploration and shale oil extraction. The embargo is also expected to include a ban on future arms deals with Russia.

Moscow could anticipate the so-called Tier Three sanctions and has begun circling the wagons. Last Tuesday President Vladimir Putin took a meeting at the Kremlin of Russia’s Security Council, the highest policymaking body on foreign-policy and security issues. Putin made an important speech at the meeting whose agenda was unmistakably to discuss Russia’s strategic options in the new Cold War climate in all areas of national policies — domestic politics, foreign policy, military power and even the ‘information war’.

Putin said: “Our Armed Forces remain the most important guarantor of our sovereignty and Russia’s territorial integrity. We will react appropriately, and proportionately to the approach of NATO’s military infrastructure toward our borders, and we will not fail to notice the expansion of global missile defence systems and increases in the reserves of strategic non-nuclear precision weaponry… we can clearly see what is actually happening: groups of NATO troops are clearly being reinforced in Eastern European states, including in the Black and Baltic Seas. And the scale and intensity of operational and combat training is growing. It is imperative to implement all planned measures to strengthen our nation’s defence capacity fully and on schedule.” (Kremlin website).

This week’s events all but scotch any residual prospects of an accommodation between Washington and Moscow. Equally, Europe’s mediatory role — France and Germany’s in particular — is also petering out. The US estimation is it is in a ‘win-win’ situation, because, as Carnegie scholar Dmity Trenin noted this week, “Even if no pro-Western leader replaces a Putin in the Kremlin… Russia will succumb to another period of turmoil, making it to focus on itself rather than creating problems for Washington.”

Trenin put the scenario starkly: “It is no longer the struggle for Ukraine, but a battle for Russia. If Vladimir Putin manages to keep the Russian people on his side, he will win it. If not, another geopolitical catastrophe might follow.”

Of course, Trenin exaggerates. Putin’s popularity rating is twice that of Obama. The Russian people admire Putin as a patriot and strong leader, whereas Americans increasingly see Obama as a bungler no matter what it is that he fiddles with.

But the real danger lies somewhere else — namely, the international community may have to pay a heavy price for Obama’s bungling in a new Cold War setting. When Iran could not be browbeaten by sanctions, what makes Obama and his European colleagues so confident that a much more powerful country like Russia can be?

Does the combined might of the US and its European allies suffice to reset the world order and isolate Russia, which, by the way, is an avid globalizer, too — unlike the former Soviet Union?

If Europe is not going to buy Russian oil and is going to diversify, what happens to the oil market that also caters to the rest of the world? What happens indeed to Europe’s economic recovery itself if oil price shoots up?

Quite obviously, when Russia sees the NATO and the ABM deployment as an existential challenge, how can it reconcile ever with the establishment of US-NATO military bases in Afghanistan? Again, if Russia is an adversary, why should it cooperate any further with the US (and the West) over Iran, Syria or Iraq?

Where does all this leave the other major countries in the nonWestern quarters of the world — India, Brazil or China? Does the West expect these countries to comply with their Tier Three sanctions regime? What if they don’t?

No, Mr. Trenin, you’re mistaken. This is not really about the regime in Russia; this is about the world order. This is about the Bretton Woods system and the challenge to it that Putin spearheads, as evident at the Fortaleza summit of the BRICS.

This is Obama’s counterattack in a guerilla war, frightened about the growing challenge to the supremacy of the US dollar. The point is, without the seamless freedom to print dollar bills, the American economy is doomed.

The rest of the world understands perfectly well what the new Cold War is all about. Even the Europeans aren’t duffers, they too comprehend what is going on, as their great reluctance to isolate Russia testified all these weeks and months.

Most certainly, there is no ideology involved here. It is not a war on socialism or on terrorism, nor is it a war about Ukraine or Russia intrinsically. In plain terms, the new Cold War is about the perpetuation of the US’ global dominance.

Without the Bretton Woods system, without NATO, without nuclear superiority over Russia, the US faces the prospect of becoming a vastly diminished power over time. Without the trans-Atlantic leadership, it gets reduced to what it used to be before World War I one hundred years ago — an influential regional power in the Western Hemisphere.


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