Breaking Windows
If Vladimir Putin could push the "rewind" button, knowing a few weeks ago what he knows today, would he have opted not to attack Ukraine?
I know many would like to think so, but I fear that's wishful thinking. Putin hasn't taken Ukraine... yet, and it's clear that even if he manages to occupy the country, that occupation will cost Russia dearly. All that notwithstanding, and even if he had expected the fierce resistance, I bet he'd have attacked anyway.
Because despite all the resistance and losses, he is going to get some of what he wanted.
His proposed "off ramp," Ukraine ceding the Eastern provinces and formally renouncing Crimea, is the public face-saver he'll demand, the trophy he'll bring home to the Russian people. With the caveat that this is all evolving incredibly rapidly, with every day adding new information and changed conditions, it seems the likely outcome apart from a long-slog occupation. But, even if the Ukrainians beat him back and he does take his toys and goes home, he will have nevertheless achieved another of his apparent goals.
Ukraine may end up in the EU and NATO, but Ukraine will be a devastated and militarily depleted nation looking at decades of rebuilding. Even with Western aid, which will certainly be fire-hosed in. Millions of displaced Ukrainians will be massive resource drain (food, clothing, shelter) on the West until they can be repatriated - which will first require major rebuilding. Ukraine's damaged buildings, destroyed roads and infrastructure will all have to be repaired or razed and reconstructed from scratch. Her military will have to be reconstituted almost from zero.
There will be seething anger at Putin and Russia, but it'll be a toothless anger, counterweighted as it will be by the inability to do anything to Russia.
The West's sanctions (which I support) will continue, even if a settlement and peace treaty require their formal rescission. Western Big Business won't do business with Russia (consumers and the media will shame those that do), Europe will find a way to wean herself off the Russian gas-and-oil teat, and Russia will be persona non grata, at least to Europe and North America.
None of this will matter.
Xi is there for Putin, and China will buy everything Russia needs to sell. At a discount, of course - I have predicted that Russia will come out of this as a Chinese client state. Russia’s economy will suffer, as will her people, but Putin will have his success.
Putin will have his Ukrainian border security assurance by default, because he'll have smashed everything in the country.
He is breaking every window and smashing every stick of furniture in a house he wants but can't have, and leaving a giant money-pit mess for the owners to clean up when he's gone.
There’s an economic lesson herein. French economist Frédéric Bastiat offered us, back in 1850, the parable of the broken window. Therein, he illustrates how spending money on items that have been destroyed does not lead to economic gain. Keep that in mind when people try to find some sort of silver lining in Ukraine’s reconstruction - and keep it in mind as our government continues on its quest to replace what’s not broken via its Green energy and infrastructure policy. When they tell you of ‘jobs created’ by their spending, ponder the abandoned wealth that they never bother to mention.
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Yours in liberty,
Peter.
Great piece. Things seem like they are moving fast and in an odd continuous way due to our exposure but we are still only talking days, not even a month. This whole thing may only be two sentences in a history book 50 years from now, or it could be what causes us to gloss over the end of the Cold War the same way we like to jump from WWI to WWII. That is my round about way of saying I think facts as they are Putin would still invade and I am not so sure he is looking for this, oft mentioned though unseen, "off ramp".