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Irresponsible Blogging?

Over on the Global Guerillas blog, John Robb suggests that the countries currently feeling threatened by Russia should change their strategies:

This shift towards economics and networks also means that small states on Russia's periphery now have a defensive trump card. They can inflict damage on Russia that far exceeds the potential economic benefits Russia receives. Any one of these nations could easily inflict tens of billions in damage to Russia's energy industry (which pays for much of the Russian government). IF these nations came together in a defensive alliance, its possible that Russian energy production could be halved and inflict damage that's counted in the trillions.

Left to the side of this is that Russia is often a big trading partner of these countries, and that any damage done to the Russian economy - and gas pipes in particular - would damage these countries as much, or more. In some ways, this is a MAD strategy.

Moreover, Russia's current actions in Georgia don't appear to have their basis in economic interests, after all, they did not take the pipelines out. And the Russian stock market did not exactly benefit. This is not to say that Russia can't be deterred by further economic disincentives. But plans to damage critical infrastructure could be learned of by the Russians. They have spies. And it could lead to a broad array of Russian counteraction, the least of which would be the expulsion of many nationals, something Russia had already done with the Georgians.

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Pat Patterson on :

Those former satellites may not even have to do that. America may indeed have its economic woes but nothing compared to Russia which have merely accelerated since May due to its revanchist and irredentist policies in the Caucasus. Since August foreign capital invested in Russia has declined from an estimated $300 billion to less than $40 billion. The Russian stock market is down almost 50% over the same period though it lost some 23% in value just last week before the Russian stock exchange was closed on Tuesday. The Russians do have a surplus of $500 billion but plans to invest this money in the capital markets took a turn south when the government realized that a huge percentage of Russian citizens, something like 75% own shares and much of that is concentrated in the elderly who have invested heavily to make up shortfalls in pensions. And with oil now at $97.99(9/18/2008) compared to $141.00 during the early summer the Russians will fast approach a capital crunch that will undo some of the geostrategic plans and gains of the last few years.

Pat Patterson on :

I left out one other piece of bad news for Russia in that Germany and Spain just signed multi-million futures contracts with ARAMCO and Dubai for $180.00 which means that the Russians will have to match that price and try to increase production without the capital to make up for the cheaper price per barrel.

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