Paul Craig Roberts: Is Putin’s Strategy Finally Beginning To Work?

Authored by Paul Craig Roberts,

I have explained Russian President Vladimir Putin’s Christian practice of turning the other cheek to Western provocations as a strategy to convey to Europe that Russia is reasonable but Washington is not and that Russia is not a threat to European interests and sovereignty but Washington is. By accommodating Israel and withdrawing from the multi-nation Iran nuclear-nonproliferation agreement, US President Donald Trump might have brought success to Putin’s strategy.

Washington’s three main European vassal states, Britain, France, and Germany have objected to Trump’s unilateral action. Trump is of the opinion that the multi-nation agreement depends only on Washington. If Washington renounces the agreement, that is the end of the agreement. It doesn’t matter what the other parties to the agreement want. Consequently, Trump intends to reimpose the previous sanctions against doing business with Iran and to impose additional new sanctions. If Britain, France, and Germany continue with the business contracts that have been made with Iran, Washington will sanction its vassal states as well and prohibit activities of British, French, and German companies in the US. Clearly, Washington thinks that Europe’s profits in the US exceed what can be made in Iran and will fall in line with Washington’s decision, as the vassal states have done in the past.

And they might. But this time there is a backlash. Whether it will go beyond strong words to a break with Washington remains to be seen. Trump’s neoconservative pro-Israel National Security Advisor John Bolton has ordered European companies to cancel their business deals in Iran. Trump’s ambassador to Germany Richard Grenell has ordered German companies to immediately wind down their business operations in Iran. The bullying of Europe and blatant US disregard of European interests and sovereignty has made Europe’s long vassalage suddenly all too apparent and uncomfortable.

Germany’s Chancellor Angela Merkel, previously a loyal Washington puppet, said that Europe can no longer trust Washington and must “take its destiny into its own hands.” 

European Commission President Jean-Claude Juncker said that Washington’s leadership had failed and it was time for the EU to take over the leadership role and to “replace the United States.” Various French, German, and British government ministers have echoed these sentiments.

The cover story of the German news magazine Der Spiegel, “Goodbye Europe,” has Trump giving Europe the middle finger.  The magazine declares that it is “Time for Europe to Join the Resistance.”

Although European politicians have been well paid for their vassalage, they might now be finding it an unworthy and uncomfortable burden.

Whereas I respect the virtue of Putin’s refusal to reply to provocation with provocation, I have expressed concern that Putin’s easy acceptance of provocations will encourage more provocations that will increase in intensity until war or Russian surrender become the only options, whereas if the Russian government took a more aggressive position against the provocations, it would bring the danger and cost of the provocations home to the Europeans whose compliance with Washington enables the provocations. Now it seems that perhaps Trump himself has taught that lesson to the Europeans.

Russia has spent several years helping the Syrian Army clear Syria of the terrorists that Washington sent to overthrow the Syrian government. However, despite the Russian/Syrian alliance, Israel continues illegal military attacks on Syria. These attacks could be stopped if Russia would provide Syria with the S-300 air defense system.

Israel and the US do not want Russia to sell the S-300 air defense system to Syria, because Israel wants to continue to attack Syria and the US wants Syria to continue to be attacked. Otherwise, Washington would call Israel off.

Several years ago before Washington sent its Islamist proxy troops to attack Syria, Russia agreed to sell Syria an advanced air defense system, but gave in to Washington and Israel and did not deliver the system. Now again in the wake of Netanyahu’s visit to Russia we hear from Putin’s aide Vladimir Kozhim that Russia is continuing to withhold modern air defenses from Syria.

Perhaps Putin believes he has to do this in order not to give Washington an issue that could be used to pull Europe back in line with Washington’s policy of aggression. Nevertheless, for those who do not see it this way, it makes Russia again look weak and unwilling to defend an ally.

If Putin believes that he will have any influence on Netanyahu in terms of selling peace agreements with Syria and Iran, the Russian government has no understanding of Israel’s intent or Washington’s 17 years of war in the Middle East.

I hope Putin’s strategy works. If it doesn’t, he will have to change his stance toward provocations or they will lead to war.

The Revolving Door Continues: Tesla Loses Two More Executives

The hits just keep on coming for Tesla. Amidst a single day period where a record number of headlines were packed into about 24 short hours for Tesla – including a Morgan Stanley downgrade, news that the company would again be shutting down production of its Model 3 toward the end of the month and a Model S crash and ensuing fatality in Switzerland – even more news broke toward the end of the day today when it was reported that (surprise) two more executives, Arch Padmanabhan, the product director for Tesla’s stationary storage unit, and Bob Rudd, from Solar City, are leaving the company.

It’s starting to feel a little bit like the movie Groundhog Day with the executive departure headlines. Reuters has noted all of the 2018 departures so far in this article. These two Tesla Energy employees join the ranks of other employees who hit the road this year:

The list of executives who have departed the company over the last few years has been running at a relatively steady clip that usually winds up chalking up a couple of names every month or so – that looks to be accelerating. Bloomberg reported on today’s departures:

Tesla Inc.’s energy unit has lost two major executives as CEO Elon Musk promises to reorganize the electric-car maker’s management team, according to people familiar with the matter.

Arch Padmanabhan, the product director for Tesla’s stationary storage unit, and Bob Rudd, a former SolarCity vice president who led North American commercial and utility sales, have both left the company, said the people, who asked not to be identified because they aren’t authorized to speak publicly. Tesla didn’t immediately comment on the departures. Padmanabhan said he’s working on a new venture and declined to elaborate. Rudd couldn’t be reached for comment.

Not unlike Doug Field, one of the only four executives listed on the company’s proxy who has apparently taken a leave of absence, Padmanabhan as also mysteriously left to “work on a new venture”. But recently executive departures have been happening at an astonishing rate:

Matthew Schwall, Tesla’s primary contact with U.S. regulators, left to join Waymo, the self-driving-car company started by Google. Jim Keller, head of the driver-assistance system Autopilot, left last month for Intel Corp. Two top financial executives left in March, and sales chief Jon McNeil defected to Lyft Inc. in February. Musk told employees in an email on Monday that he’s “flattening” Tesla’s management structure to improve communication.

Analysts and critics of the company continue to harp on the fact that Tesla has a revolving door of executives, with some attributing it to a possible toxic tone at the top. Other guesses for all of the executive departures include the company simply not having any type of operational clue as to what it’s doing. This would certainly explain the Model 3 factory line shut down which was reported today just hours after after it was reported by Electrek that the company could be producing 500 cars per day this week.

Reuters notes that two sources confirmed that the next stoppage on the general assembly line at the Fremont, California, plant was scheduled for May 26-31.

The production-challenged electric vehicle maker previously warned of 10 days of temporary shutdowns this quarter as the company addresses manufacturing problems that have delayed volume production of the Model 3 sedan, which is seen as crucial to Tesla’s long-term profitability, Reuters adds.

This follows the previous production halt on April 17th to make “on-the-fly fixes”, as well as a prior stoppage in February.  The April shutdown, combined with the upcoming one, would add up to the planned 10 days of stoppages.

Tesla has been struggling to find solutions to manufacturing bottlenecks on the new assembly line that produces the Model 3, a sedan intended for volume production. An over-reliance on robots has complicated that task, Chief Executive Officer Elon Musk has acknowledged.

Musk, Tesla’s billionaire founder, told employees it was “quite likely” the company would reach a rate of 500 Model 3s per day this week, or 3,500 a week, automotive news website Electrek reported on Tuesday, citing an internal email. Musk also told staff to alert him of “any specific bottlenecks” on the production line.

While Musk has said the planned stoppages are intended to give the company time to perform upgrades that will help it reach a goal of building 6,000 vehicles per week by the end of June, the market is becoming increasingly skeptical, especially since in order to meet the production goal of 6,000 cars per week by the end of July, Musk said last month that all Model 3 production would begin working around the clock.

This came after yesterday’s news of a horrific fire in Switzerland which killed a man.

In the same week in which a Tesla Model S erupted in flames after a “horrific” crash in Ft. Lauderdale, fatally trapping the two teenagers who died inside, while a second Model S rammed a stopped Salt Lake City firetruck at 60mph, mercifully without any fatalities, the Swiss reports that yet another Tesla burst into flames after crashing on the A2 highway near the town of Bellinzona, killing a 48-year-old German driver who was trapped inside.

According to the Swiss publication, the driver, a 48-year-old German motorist from Baden-Wurtermberg, lost control of the vehicle a few meters after the Monte Ceneri tunnel, crashing into the central guardrail, an accident that was remarkably similar to an October 2017 crash in Austria, in which a Model S also burned down, however without any fatalities.

The car then overturned and caught fire, fatally trapping the driver.

At this point the rate with which negative Tesla new stories are hitting the wire is almost comical and difficult to keep up with. While the stock traded lower today again, closing near $280 per share, the company still has an insane $50 billion valuation despite its bonds trading for about $.88 on the dollar at last check.

At some point, if the company stock price catches down to the reality of what has been taking place at the company, these bumps in the road from executive departures could be looked at as the golden days.

Why The Empire Never Sleeps: The Indispensable Nation Folly

Authored by David Stockman via Contra Corner blog,

Like the case of Rome before it, the Empire is bankrupting America. The true fiscal cost is upwards of $1.o trillion per year (counting $200 billion for veterans and debt service for wars), but there is no way to pay for it.

That’s because the 78-million strong Baby Boom is in the driver’s seat of American politics. It plainly will not permit the $3 trillion per year retirement and health care entitlement-driven Welfare State to be curtailed.

The Trumpite/GOP has already sealed that deal by refusing to reform Social Security and Medicare and by proving utterly incapable of laying a glove politically on Obamacare/Medicaid. At the same time, boomers keep voting for the GOP’s anti-tax allergy, thereby refusing to tax themselves to close Washington’s yawning deficits.

More importantly, the generation which marched on the Pentagon in 1968 against the insanity and  barbarism of LBJ’s Vietnam War have long since abandoned the cause of peace. So doing, boomers have acquiesced in the final ascendancy of the Warfare State, which grew like topsy once the US became the world’s sole superpower after the Soviet Union slithered off the pages of history in 1991.

Yet there is a reason why the end of the 77-year world war which incepted with the “guns of August” in 1914 did not enable the world to resume the status quo ante of relative peace and prosperous global capitalism.

To wit, the hoary ideology of American exceptionalism and the Indispensable Nation was also, ironically, liberated from the shackles of cold war realism when the iron curtain came tumbling down.

Consequently, it burst into a quest for unadulterated global hegemony. In short order (under Bush the Elder and the Clintons) Washington morphed into the Imperial City, and became a beehive not only of militarism, but of an endless complex of think-tanks, NGO’s, advisories and consultancies, “law firms”, lobbies and racketeers.

The unspeakable prosperity of Washington flows from that Imperial beehive. And it is the Indispensable Nation meme that provides the political adhesive that binds the Imperial City to the work of Empire and to provisioning the massive fiscal appetites of the Warfare State.

Needless to say, Empire is a terrible thing because it is the health of the state and the profound enemy of capitalist prosperity and constitutional liberty.

It thrives and metastasizes by abandoning the republican verities of non-intervention abroad and peaceful commerce with all the nations of the world in favor of the self-appointed role of global policeman. Rather than homeland defense, the policy of Empire is that of international busybody, military hegemon and brutal enforcer of Washington’s writs, sanctions, red lines and outlawed regimes.

There is nothing more emblematic of that betrayal of republican non-interventionism than the sundry hot spots which dog the Empire today. These include the Ukraine/Crimea confrontation with Russia, the regime change fiasco in Syria, the US sponsored genocide in Yemen, the failed, bloody 17-year occupation of Afghanistan, the meddling of the US Seventh Fleet in the South China Sea, and, most especially, the swiftly intensifying contretemps in Iran.

As to the latter, there is absolutely no reason for the Empire’s attack on Iran. The proverbial Martian, in fact, would be sorely perplexed about why Washington is marching toward war with its puritanical and authoritarian but relatively powerless religious rulers.

After all, it hasn’t violated the nuke deal (JPAOC) by the lights of any credible authority—-or by even less than credible ones like the CIA. Nor by the same consensus of authorities has it even had a research program for nuclear weaponization since 2003.

Likewise, its modest GDP of $43o billion is equal to just eight days of US output, thereby hardly constituting an industrial platform from which its theocratic rulers could plausibly menace America’s homeland.

Nor could its tiny $14 billion defense budget—which amounts to just sevendays worth of DOD outlays—inflict any military harm on American citizens.

In fact, Iran has no blue water navy that could effectively operate outside of the Persian Gulf; its longest range warplanes can barely get to Rome without refueling; and its array of mainly defensive medium and intermediate range missiles cannot strike most of NATO, to say nothing of the North American continent.

The answer to the Martian’s question, of course, is that Iran is no threat whatsoever to the safety and security of the US homeland, but it has run badly afoul of the dictates of the American Empire.

That is to say, it has presumed to have an independent foreign policy involving Washington proscribed alliances with the sovereign state of Syria, the leading political party of Lebanon (Hezbollah), the ruling authorities (and US puppets) in Baghdad and the reining power in the Yemen capital of Sana’a (the Houthis).

These are all deemed by Washington to be sources of unsanctioned “regional instability” and Iran’s alliances with them have been capriciously labeled as acts of state sponsored terrorism.

The same goes for Washington’s demarche against Iran’s modest array of short, medium and intermediate range ballistic missiles. These weapons are palpably instruments of self-defense, but Imperial Washington insists their purpose is aggression—–unlike the case of practically every other nation which offers its custom to American arms merchants.

For example, Iran’s arch-rival across the Persian Gulf, Saudi Arabia, has more advanced NATO supplied ballistic missiles with even greater range (2,600 km range). So does Israel, Pakistan, India and a half-dozen other nations, which are either Washington allies or have been given a hall-pass in order to bolster US arms exports.

In short, Washington’s escalating war on Iran is an exercise in global hegemony, not territorial self-defense. What the proverbial Martian is really asking, therefore, is how did the Empire come about?

How did the historic notion of national defense morph into Washington’s arrogant claim that it constitutes the “Indispensable Nation” which stands as mankind’s bulwark against global disorder and chaos among nations?

As indicated above, Iran is just the case de jure of the Indispensable Nation in action. Yet the other hot spots of the moment are no less exercises in hegemonic aggression.

Thus, Washington started the Ukrainian confrontation by sponsoring, funding and recognizing the February 2014 coup that overthrew a Russia-friendly government with one that is militantly nationalistic and bitterly antagonistic to Russia. It re-opened deep wounds that date back to Stalin’s brutal rein in Ukraine and Ukrainian collusion with Hitler’s Wehrmacht on its way to Stalingrad and back.

So doing, it triggered the fear-driven outbreak of Russian-speaking separatism in the Donbas and the 96% referendum in Crimea to formally re-affiliate with mother Russia (which originally purchased it from the Ottomans in 1783).

Even a passing familiarity with Russian history and geography would remind that Ukraine and Crimea are Moscow’s business, not Washington’s.

Even more hideous is the rhetorical provocations and Seventh Fleet maneuvers ordered by Washington with respect to China’s comical sand castle building in the South China Sea. Whatever they are doing on these man-made islands, it is not threatening to the security of America—nor is there any plausible reason to believe that it is a threat to global commerce, either.

After all, it is the mercantilist economies of China and East Asian that would collapse almost instantly if it attempted to interrupt world trade. That is, any theoretical red military shoe would first fall on the Red Suzerains of Beijing themselves because it is the hard currency earnings from its export machine that keep the Red Ponzi from collapsing and the Chinese people enthrall to their communist overlords.

Needless to say, none of these kinds of interventions were even imaginable in the sleepy town of Washington DC just 100-years ago. But it’s baleful evolution from the capital of an economically focused Republic to seat of power in a globally mobilized Empire ultimately sprung from the Indispensable Nation heresy.

So we intend to delve into the historic roots of that conceit in a multi-part series because it not only guarantees unending calamities abroad, but also an eventual fiscal and financial horror show at home.

Indeed, so long as Imperial Washington is stretched about the planet in its sundry self-appointed missions of stabilization, “peacekeeping”, punishment, attack and occupation, there is zero chance that America’s collapsing fiscal accounts can be salvaged.

The Indispensable Nation folly thus hangs over the rotten edifice of Bubble Finance like, in fact, a modern day Sword of Damocles.

But Empire is a corrosive disease of governance. It eventually metastasizes into imperial arrogance, over-reach and high-handedness. Ultimately, like at present, it falls prey to the rule of bellicose war-mongers and thugs.

John Bolton and Mike Pompeo are living proof of that.

For the moment, however, make no mistake: Trump’s withdrawing from the nuke deal and pending re-imposition of maximum sanctions is an act of war by any other name.

Yes, the feinschmeckers of the foreign policy establishment consider economic sanctions to be some kind of benign instrument of enlightened diplomacy—the carrot that preempts resort to the stick. But that is just sanctimonious prattle.

When you hound the deep water ports of the planet attempting to block Iran’s oil sales, which are its principal and vital source of foreign exchange, or cut-off access by its central bank to the global money clearance system known as SWIFT or pressure friend and foe alike to stop all investment and trade—that’s an act of aggression every bit as menacing and damaging as a cruise missile attack.

Or at least it was once understood that way. Even as recently as 1960 the great Dwight Eisenhower (very) reluctantly agreed to lie about Gary Power’s U-2 plane when the Soviets shot it down and captured its CIA pilot alive.

But Ike did so because he was old-fashioned enough to believe that even penetrating the air space of a foe without permission was an act of war—- and that he did not intend, the CIA’s surveillance program notwithstanding.

Today, by contrast, Washington invades the economics space of foreign nations with alacrity. In fact, the US Treasury Department’s Office of Foreign Asset Control (OFAC) proudly lists 30 different sanctions programs  including ones on Belarus, Burundi, Cuba, Congo, Libya, Somalia, Sudan, Venezuela, Yemen and Zimbabwe—along with  the more visible programs against the alleged malefactors of Iran, Russia and North Korea.

These, too, are the footprints of Empire, not measures of a homeland defense befitting a peace-seeking Republic. That would cost around $250 billion per year, and would rely on an already built and paid for triad nuclear capacity for deterrence, and a modest Navy and Air Force for protection of the nation’s shorelines and air space.

The $500 billion excess in today’s Trump-bloated national security budget of $750 billion is the cost of Empire; it’s the crushing fiscal burden that flows from the Indispensable Nation folly and its calamitously wrong assumption that the planet would descend into chaos without the good offices of the American Empire.

Needless to say, we do not believe that the planet is chaos-prone absent Washington’s ministrations. After all, the historic record from Vietnam through Afghanistan, Iraq, Libya, Syria and Iran suggests exactly the opposite.

More pointedly, the Indispensable Nation meme originates not in the universal condition of mankind and the nation-states into which it has been partioned, but in the one-time, flukish and historically aberrant circumstances of the 20th century that gave raise to giant totalitarian states in Hitler’s Germany and Stalin’s Russia, and the resulting mass murder and oppressions which resulted there from.

But as we will outline in greater detail in Part 2,  Stalinist Russia and Nazi Germany were not coded into the DNA of humanity—a horror always waiting to happen.

To the contrary, they were effectively born and bred in April 1917 when the US entered what was then called the Great War. And it did so for absolutely no reason of homeland security or any principle consistent with the legitimate foreign policy of the American Republic.

So you can put the blame for this monumental error squarely on Thomas Woodrow Wilson——-a megalomaniacal madman who was the very worst President in American history; and who took America into war for the worst possible reason—a vainglorious desire to have a big seat at the post-war peace table in order to remake the world as God had inspired him to redeem it.

The truth, however, was that the European war posed not an iota of threat to the safety and security of the citizens of Lincoln NE, or Worcester MA or Sacramento CA. In that respect, Wilson’s putative defense of “freedom of the seas” and the rights of neutrals was an empty shibboleth; his call to make the world safe for democracy, a preposterous pipe dream.

Indeed, the shattered world after the bloodiest war in human history was a world about which Wilson was blatantly ignorant. And remaking it was a task for which he was temperamentally unsuited—even as his infamous 14 points were a chimera so abstractly devoid of substance as to constitute mental play dough.

Or, as his alter-ego and sycophant, Colonel House, put it: Intervention positioned Wilson to play “The noblest part that has ever come to the son of man”.  

America thus plunged into Europe’s carnage, and forevermore shed its century-long Republican tradition of anti-militarism and non-intervention in the quarrels of the Old World. From that historically erroneous turn—there arose at length the Indispensable Nation Folly ,which we shall catalogue in the balance of this series.

For now, suffice it to say that there was absolutely nothing noble that came of Wilson’s intervention.

It led to a peace of vengeful victors, triumphant nationalists and avaricious imperialists—-when the war would have otherwise ended in a bedraggled peace of mutually exhausted bankrupts and discredited war parties on both sides.

By so altering the course of history, Wilson’s war bankrupted Europe and midwifed 20th century totalitarianism in Russia and Germany.

These developments, in turn, eventually led to the Great Depression, the Welfare State and Keynesian economics, World War II, the holocaust, the Cold War, the permanent Warfare State and its military-industrial complex.

They also spawned Nixon’s 1971 destruction of sound money, Reagan’s failure to tame Big Government and Greenspan’s destructive cult of monetary central planning.

So, too, flowed the Bush’s wars of intervention and occupation, their fatal blow to the failed states in the lands of Islam foolishly created by the imperialist map-makers at Versailles and the resulting endless waves of blowback and terrorism now afflicting the world.

And not the least of the ills begotten in Wilson’s war is the modern rogue regime of central bank money printing, and the Bernanke-Yellen-Powell plague of bubble economics which never stops showering the 1% with the monumental windfalls from central bank enabled speculation.

As to how all this transpired, stay tuned!