The Self-Imposed Impotence of the Russian and Chinese Governments, by Paul Craig Roberts

It’s SLL’s guess that Russia and China have their own reasons for what they do, and they have nothing to do with diffidence, impotence, or ignorance, as Paul Craig Roberts suggests. From Roberts at paulcraigroberts.com:

The Russian and Chinese governments are puzzling. They hold all the cards in the sanction wars and sit there with no wits whatsoever as to how to play them.

The Russians won’t get any help from the Western media which obscures the issue by stressing that the Russian government doesn’t want to deprive its citizens of consumer goods from the West, which is precisely what Washington’s sanctions intend to do.

The Russian and Chinese governments are in Washington’s hands because Russia and China, thinking that capitalism had won, quickly adopted American neoliberal economics, which is a propaganda device that serves only American interests.

For years NASA has been unable to function without Russian rocket engines. Despite all the sanctions, insults, military provocations, the Russian government still sends NASA the engines. Why? Because the Russian economists tell the government that foreign exchange is essential to Russia’s development.

Europe is dependent on Russian energy to run its factories and to keep warm in winter. But Russia does not turn off the energy in response to Europe’s participation in Washington’s sanctions, because the Russian economists tell the government that foreign exchange is essential to Russia’s development.

As Michael Hudson and I explained on a number of occasions, this is nonsense. Russia’s development is dependent in no way on the acquisition of foreign currencies.

The Russians are also convinced that they need foreign investment, which serves only to drain profits out of their economy.

The Russians are also convinced that they should freely trade their currency, thereby subjecting the ruble to manipulation on foreign exchange markets. If Washington wants to bring a currency crisis to Russia, all the Federal Reserve, its vassal Japanese, EU, and UK central banks have to do is to short the ruble. Hedge funds and speculators join in for the profits.

Neoliberal economics is a hoax, and the Russians have fallen for it.

So have the Chinese

To continue reading: The Self-Imposed Impotence of the Russian and Chinese Governments

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