Friday, August 29, 2008

Old Enemies Are The Best Enemies

I thought Russia was a toothless tiger? Well, it was until the developing world dumped all of its cash in Russia for oil and gas. Now Russia is growing its weak military and expanding its influence as far as it can.

Russian giant Gazprom is the largest extractor of natural gas in the world and is second only to Saudi Arabia in oil reserves. Russia, in an effort to gain tight control over the energy business, seized Gazprom with a token and undervalued purchase of shares in 2005. Now it appears that the company is open to all investors and is technically no longer “owned” by the Russian Government. But is the damage already done?

Oil and gas tax revenues account for a large percentage of Russia’s “working capital”. So would that make Russia a one trick pony? Yes, but with $31 Billion in Gazprom sales and 16% of all the worlds natural gas production… that is one hell of a trick! All of this spells out that Russia has the money to expand its influence. It is expanding that influence in Georgia right now. Russia is frightened that the US and the NATO are gaining many foot holds in former Soviet republics. And, we are. Poland, the Czech Republic and the Ukraine have all been romanced by NATO and the US. If the Russians were to enter Poland we would be obligated to send troops and force them out.

Is this a return to the Cold War? No, maybe the “Chilly Conflict” but not a “Cold War.” The US has just retained permission from Poland to park defensive missile batteries in Russia’s back yard. The Czech Republic and the Ukraine are considering and have considered similar deals. This makes Russia nervous and in their eyes this recalculates the formula for MAD or Mutually Assured Destruction. Thus their entry into Georgia to do a little flexing and saber rattling.

What? I thought we didn’t have to worry about nuclear war any more?

When did we stop? As long as one country possesses a nuclear device we will have to worry about it being used. This is why we have parked defensive measures in Eastern Europe, to defend ourselves against the threat that most of us have forgotten about. A very real threat that has never gone away. In fact, even though the US and Russia have enjoyed a de-escalation over the past 20ish years the world has seen an escalation in or proliferation in the number of countries that have nuke capabilities.

When Russian and the former republics were dirt poor in the 90s trading in nuclear secrets was all the rage and a good way to earn some money. Information and material was traded all over the world. Pakistan, North Korea, Iran and many more have enjoyed the fire-sale discount of nuclear know-how thanks to Russia’s lean years. As previously stated those “lean” years are a memory and Russia enjoys top billing as an energy giant.

So what next? Will Russia go too far? History says yes. Russia will over extend itself adventuring into former republics. It will re-take its role as the traditional bad-guy that the US has had to play for the past 10 years and it will over state its potential and underestimate its rivals. I see only one change -bigger pocket books to dwindle.

So dust off that copy of “Red Dawn” or “The Hunt for Red October”. Our favorite villain is back with deep pockets and wayward ambitions!

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