Author : Rachel Poole
Date : January 6, 2022
January 6, 2022
We invite you to check out John’s new book, The Canon of the Markets: Reflections from the Attic of History, Philosophy, Literature, and Statecraft. This collection of John’s commentaries on financial markets and statecraft is now available for purchase on Amazon.com (see bottom of this message).
While the new year is often seen as a time to shake off the bad habits of yesteryear and embrace the new rhythms of today, in geopolitics the baggage of years past is not so easily shaken off. For this week’s geopolitical look, we begin with a look at unrest in Kazahkstan, before moving to the US’s three most concerning foreign threats: China, Russia, and Iran. From there, we examine how Xi Jinping’s rhetoric is designed to push CCP officials to produce better results. Our fourth article examines how Lithuania embodies many elements of the US-China conflict, before zooming out to look at ten important conflicts to keep an eye on for 2022.
Adam Taylor, TheWashington Post
Following a release of gas price controls that doubled liquified petroleum prices in Kazakhstan overnight, the country has seen the fiercest protests of the post-Soviet era. Internet restrictions have made precise information on the protests difficult to come by, but it is clear that they have turned political, are widespread, and are sometimes violent. Much of the frustration is centered on Kazahkstan’s “ruler for life,” Nursultan Nazarbayev, who was the country’s first president following the collapse of the Soviet Union and retains a grip on power despite stepping down from the presidency in 2019. Nazarbayev is the latest in a series of post-Soviet leaders to face widespread protests, a list including Belarusian president Alexander Lukashenko. Moscow has painted these protests as the machinations of Western democracies against Russia and its allies, a claim the US dismisses as “part of the standard Russian disinformation playbook.” With Putin’s term officially expiring in 2024, the Russian president (a student of history) will likely pay close attention to what happens to Nazarbayev in the aftermath of these protests; after all, the protests in Kazakhstan that eventually placed Nazarbayev in power also portended the end of the Soviet Union.
Spectre of three wars poses danger to America’s dominance
Gideon Rachman, Financial Times
If the United States pulls back, the world will become more dangerous
The Economist
The US is facing militarized crises in Europe, Asia, and the Middle East which means it is quite possible that the US could be sucked into fighting two or even three wars simultaneously. Russia could invade Ukraine “as soon as early 2022”, China’s military exercises near Taiwan are looking more and more like preparations for a full-scale invasion, and Iran may be just weeks away from creating enough fissile material to manufacture a nuclear weapon. While there does not seem to be any obvious link between these three potential conflicts, Russia, China, and Iran all have ambitions to increase their regional dominance upon claims of kinship beyond their national borders. Additionally, they each say they have been targeted for “regime change” by the US. This is all coming at a time when the US is looking “weak” and its allies are questioning its commitments which may increase the temptation for Russia, China and/or Iran to “redress old grievances, or push forward with long-held ambition”, as Gideon Rachman puts it. The question is, how far will the US go to prevent an invasion of Ukraine or Taiwan, and how would it actually react if Iran were to manufacture a nuclear weapon? The Economist argues that America has become reluctant to use hard power as both hawks and doves in Washington are calling for “restraint”. The hawks say the US needs only to focus on standing up to China while the doves say policing the world will only result in the country getting caught, once again, in the middle of needless conflicts that it cannot win. The US is not the hegemon it was in the 1990s so if the liberal democratic order is to be preserved, other democracies will have to step up to the plate, spending more on defense, sharing intelligence, and working harder to overcome old quarrels with neighbors to promote a rules-based order.
Yuen Yuen Ang, Foreign Affairs
“The elliptical art of Chinese Marxist phraseology [has] often left foreign observers scratching their heads,” Ang writes of the sloganeering used within Xi’s CCP to further his agenda. The most recent iteration of this phenomenon is the nebulous phrase “common prosperity,” cited as the justification for last year’s cutting down of large corporations across several industries. The term is almost intentionally vague, used to capture the tension between a desire for prosperity and the inherent inequality increased wealth brings. In his manifesto on the topic, Xi gives few specific instructions to the party officials he addresses, instead leaving room for what Ang calls “directed improvisation” among the lower tiers of bureaucrats. In so doing, the CCP is attempting to permit policy innovation without staking its reputation on an untried approach. This does not mean that there are no specific directives – Xi discourages officials from setting unrealistic goals (as happened in a prior anti-poverty campaign) while also exhorting them to strengthen ideological controls. But calls to “tailor your methods to local conditions” indicate the CCP’s lack of a centralized plan to pull its economy out of the middle income trap. While China’s prosperity is clearly a prominent leaf in it laurel, it cannot now admit its struggle to progress further, especially as its economic woes mirror those felt in the US during the Gilded Age. As China continues to grapple with its wealth, only time will tell if its centralized grip on many elements of Chinese life is sustainable and compatible with continued growth.
Tod Lindberg and Peter Rough, The Wall Street Journal
Lithuanian Foreign Minister Gabrielius Landsbergis recently described his country as a “canary in the coal mine”, as Lithuania is being used by Russia and China to test the credibility and resolve of the US and Europe. Russia has increased pressure on Lithuania by militarizing Kaliningrad, a Russian exclave on the Baltic Sea, and bringing its neighbor Belarus into its security sphere. Lithuania sparked tensions with China last year when it decided to leave the Beijing-designed framework for dealing with Europe, named 17+1, and allowed Taiwan to open a representative office in Lithuania’s capital, Vilnius. In response to Lithuania’s actions, China declared an import ban on products with goods made in Lithuania. This has been extremely damaging to any European companies with factories or supply-chain sources in Lithuania and, thus, has caused a wave of multinational corporations to close their doors in the country. As the pressure builds on Lithuania, Russia and China are waiting to see if the US and Europe, Lithuania’s declared allies, will support it fully and stand against Russian and/or Chinese aggression. If they were to fail to back Lithuania, American and European allies around the world will doubt the West’s commitment to aiding its partners and promoting democracy, which could, in turn, lead many into the hands of Russia and China instead.
Comfort Ero and Richard Atwood, Foreign Policy
As the US’s direct influence has dwindled in the post-Cold War era, instability has increased even as direct war has decreased. With great-power rivalry looking to make a comeback on the global stage, the fragile equilibrium will be tested by new and renewed conflicts.