Is Ukraine collateral damage for the United States?

How does Russia’s invasion of Ukraine benefit the United States? File photo: Reuters

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How does Russia’s invasion of Ukraine benefit the United States? File photo: Reuters

In 1985, at the height of the Cold War, Hollywood produced a movie called “Rocky IV,” a quintessentially good-American-bad-Russian story. It revolves around a boxing battle between Ivan Drago, a six-foot-four, 261-pound fighter from the former Soviet Union, and Rocky Balboa, an American boxer. Drago is a killing machine, trained with high-tech equipment and regular doses of anabolic steroids. Rocky, on the other hand, is a human being, training in deep snow on mountainous terrain using antiquated farm equipment.

Although Rocky is no match for Draco in physical strength, he eventually wins through his courage. It was the time of the cold war. The Washington-led North Atlantic Treaty Organization (NATO) and the Moscow-led Warsaw Treaty have clashed, fueled proxy wars, toppled governments and tortured political activists all over the world. Treaties or forces purported to be defense agreements.

In 1989, the Soviet Union collapsed, leaving the United States as the sole superpower. The Warsaw Treaty followed suit and NATO had no one to defend against. In his 1992 book, “The End of History and the Last Man”, American political scientist Francis Fukuyama wrote that humanity had reached the end point of ideological evolution and the universalization of western liberal democracy. as the ultimate form of human government. Many believed that NATO’s raison d’être was over and would soon become irrelevant, particularly because it had been formed with the Soviet Union as an avowed enemy.

But NATO not only continued to exist, but also expanded eastward toward Russia’s borders despite its pledge not to. Washington has actively pursued its aggressive and interventionist approach, including establishing military bases in distant countries. The US military was to strike the first blow by deploying armed force from afar, as Professor David Vine of the American University in Washington, DC, states in his book “The United States of War”. The war is entrenched in Washington’s foreign policy, and by granting NATO membership to Eastern European countries, he shrewdly lured Putin into invading Ukraine – a boon for the states United because they can now repair their damaged pride in Afghanistan. Those who reproached Joe Biden for withdrawing there at random now realize that he had his eyes fixed on Ukraine, the next theater of the world war.

The Ukrainian saga has made Washington the global conscience, a role the antithesis of the precedent it has notoriously won in Iraq, Syria, Libya and many other countries. But there are more rewards his corporate elites will reap.

Huge amounts of capital have left Chinese and European markets since Russia invaded Ukraine. Many foreign investors have recently sold their holdings of Chinese government bonds. $23.4 billion in equity funds left Western Europe soon after the invasion. Meanwhile, investors have poured $40.5 billion into U.S. equity funds in recent weeks, according to The Wall Street Journal.

The price of crude oil hit $139 a barrel at one point – the highest level in nearly 14 years – while wholesale gas prices for overnight delivery more than doubled. This will fuel the corporate profits of the global oil giants well.

Then there is the lucrative European hydrocarbon market that Russia has long enjoyed. In 2021, Europe bought around 81% of all Russian exports. The sanctions imposed after the invasion of Ukraine will put a big blow to it. By contrast, for the United States, which is producing gas at a record level but has no buyers, Europe is a potential customer that can pay higher prices once Russian supplies are cut off. The European Union has already signed an agreement with the United States for the purchase of liquefied natural gas (LNG) which will considerably reduce its dependence on Russian supplies.

Europe will also look to the United States for advanced defense equipment. Most notable is Germany, which for years has downplayed its military’s role in foreign policy. It has already increased its defense spending by 100 billion euros and plans to spend more than 2% of GDP in this sector. The situation in Ukraine has created a sense of insecurity that will only increase defense spending in Europe, to the benefit of the US military-industrial complex.

Looking at the global scenario, China is the third player in this conflict, although it is still silent, anxiously watching developments. He refused to condemn Russia for invading Ukraine and criticizes NATO’s eastward expansion. Beijing cannot miss NATO moving closer to China’s western borders and the Central Asian region. He is already wary of the recently formed Quad and the Australia-UK-US trilateral security pact (AUKUS) as both bolster US military presence in the Asia-Pacific region.

Washington’s Afghan adventure, partly motivated by its intention to control the heartland of Eurasia, ended in dismal failure. Biden is now on a more ambitious mission that includes encircling Russia and China. Ukraine is just collateral damage in this geopolitical game.

Dr. Sayed Ahmed is a consulting engineer and CEO of Bayside Analytix, a technology-focused strategy and management consulting firm.