Phil Mirzoev's blog

Thursday, August 11, 2022

Why is Russia not getting weak economically despite sanctions? Simple: because these sanctions are stupid

At least a certain number of people in the West, despite megatons of the cheapest and most vulgar propaganda from the States, its security services and the "democratic independent media", has gotten wise to the fact that Russian economy is none the worse for all these sanctions, that were presented by the aforementioned class of institutional liars as the "silver bullet" against Russia.

Yet I keep hearing from many of those people the same question: "How come these sanctions have been like water off the duck's back for Russia?".

The short answer is: because these sanctions are stupid - that simple. They are “spherically stupid” which means from whatever angle you might look at the substance of these sanctions they are predictably and self-parodically stupid, let alone self-destructively directed at the authors of the sanctions themselves more than anybody else, especially this is true in regards to Europe.

Russia is not only not getting weak but actually is and will be getting economically stronger because of this.
A longer answer is in general sanctions haven’t been effective very often in modern history. But even when they are, they may work only with a country/region that cannot be AUTARCHY - like Cuba for example (where sanctions definitely created a problem for the people equal to the crime against humanity and didn’t create any problems for the regime, but they technically worked in terms of impact on the economy).

In other words, you direct your sanctions against the countries which in principle cannot be self-sufficient in either A) FOOD or B) ENERGY or C) WATER.
Russia is a classic example of a natural autarky - they don’t have any problems with FOOD, ENERGY AND WATER. They sit on a 1/7th of all the dry land of God's green Earth and they have so much mineral resource and energy to feed its industry that they don’t even quite know how much and what they have.
It doesn’t mean they are a real autarky now, but being a "natural autarky" means that they have all the natural conditions to be an real autarky, which means they have lots of room for development. Needless to say, that Europe, who, to the mixture of surprised disbelief and gleeful pleasure of Russia, decided to implement these suicidal "auto-sanctions",  cannot boast the above conditions, at least as far as energy and mineral resources are concerned (part of the food condition - they have problems with fertilizers, and Russia provides almost for half of the world export of those).

Hence, already in a period of energy and food crisis, it was predictable even for a first grade college student of economics that these “sanctions” if I may call them so, will only enrich Russia, stimulate its development and propel its self-sufficient techno-industrial complex, and hit twice as hard against the super-talented authors of these sanctions, who decided to starve their own people to get back at Russia. The biggest sufferer is going to be, of course, Europe. And it feels this way right now (they have problems with energy, not Russia).

The sanctions on shipping and oil trade boosted the oil and gas price - absolutely predictably during the crisis period - to such levels that Russia had to reconsider its budget due to unexpected high volumes of revenues.

Russian government has always tried to invent new ways how to curb the drain of the foreign currency out of the country due to excessive buying of consumer goods and it has never succeeded. Well, the Western sanctions helped on this front - again as predictably as the fate of an egg thrown off the roof the Empire State Building. The partial SWIFT sanctions and problems with the private currency exchange did precisely that, instantaneously boosting the position and development of the domestic producers of the consumer goods to replace the foreign ones.

When the war started, because of fear, millions of people would have naturally drained their capital our of Russia into the Western Banks - that's exactly what one would want to hit Russia's financial system and economy. But the Western sanctions came to aid and helped Moscow like nobody could help: the restrictions on banking transactions stopped millions of Russians both inside and outside Russia from draining tens of billions of dollars out of Russia. The West told them: "NO! Let that money work for Kremlin!". Hard to imagine how Kremlin was thankful to the West for this help.


Russian State has never been able to curb the ability of the Russian oligarchs to drain money out of the country and economically blackmail the regime. Yes Putin's regime was able to curb the direct political power of the Russian oligarchs but never economic. Because of that over the past tens of years hundreds of billions of dollars drained from Russia and oligarchs themselves had always had that freedom to flee Russia. It tied Moscow's hands in very many respects in terms of managing the economy, taxes etc.

But here again, the West jumps to the assistance and starts to arrest without any due process or the rule of law the accounts and property of Russian oligarchs. That really drew STANDING OVATIONS in Russia among both - the population and the elites. After that Putin's government immediately said what everyone would expect them to say to the oligarchs "Oh, you've been frightening us for decades that you can leave Russia any moment and take all the capitals with you to the West - well, go ahead! But remember now nobody gives a damn rusty penny for your life in the West. Only Moscow can give you guarantees. Sooo, now, you sit in your f..ing dacha next to Moscow and produce oil, aluminum, copper, nickel and PAY TAXES - as much as I tell you to, and you will be participating and investing in the industrial development projects cos anyways you can't invest in any Chelsea clubs any more cos the West helped with that!". And guess what? That's exactly what those oligarchs are now going to do, because they don't have any choice, and NOT because of some magic powers of Putin but due to courtesy of the West. Putin have always dreamt about that but could never have been able to do that. But the Western sanctions have helped.

One of the well known Achilles heels of Russia that has continued to undermine its development for the last 30 years has been corruption. But the Western sanctions are structured and fulfilled in such a way that they just make corruption pointless in the sense that the corruption beneficiaries can't evacuate their money, nor can they themselves feel safe in the West - the possibility to safely hold money in the West and live in the West was the one mega condition - absolutely critical - that made the corruption in Russia so pervasive in the highest echelons of administrative power, and so efficient in blocking any serious industrial and technological development.
But the Western sanctions came to the aid again, basically eliminating the must fundamental condition that supported all that mega-corruption in Russia, no matter how many uncorrupted people in power tried to fight it. 

Needless to say, that for the same reason a tremendous amount of money that would naturally have fled Russia due to oligarchs, safely stayed in Russia thanks to the Western sanctions.

The list goes on. These sanctions were so self-caricaturistic and self-mutulating that it is not totally unreasonable to say that the authors of these sanctions have been the biggest supporters of Putin and his regime and, indeed, by the same token, the biggest betrayers of the West (let alone Ukraine).

Another role of the sanctions is to delegitimize a govt in a country against which they are aimed. But these sanctions were outright structured and declared in such a way that it was obvious without any propaganda explanations that they were directed against large swaths of the Russian population - against the people. Thus, of course, they did the complete opposite: legitimized and justified the government and rallied the nation around the government and nationalism.

As I said at the beginning, these sanctions are SPHERICALLY stupid because no matter from which angle you look at them, they are equally self-damaging for the authors and helpful to the Russian economy and the present regime.  

On other topics about the true motives behind the US role in Russia/Ukraine war and Taiwan/China see 
My little politics: The US Doesn't Want a Hot War With China, It Wants Cold War II: the US provokes wars between China and Taiwan, Russia and Ukraine for same reason (dr-world.blogspot.com)

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