Why is a country like the USA with an unsustainable debt at the inconceivable level of 34 trillion decides to give $61 billion to a “completed case” like Ukraine – that is, a bankrupt economy whose military infrastructure and manufacturing base have both been destroyed by the Russian “bear” as part of the military operation?
The answer in a nutshell is this: The US, following the example of Vladimir Putin, who rescued the domestic economy that was the subject of unprecedented sanctions in history, is turning its economy into a war economy in order to rebuild its damaged manufacturing base and respond to the fact that their geopolitical role as sole superpower is now being challenged in practice by the Global South alliance.
The decision of the House of Representatives
The House of Representatives held a rare session on Saturday, April 20, to vote on proposed $95 billion in aid to Ukraine, Israel and Taiwan, a vote the White House, Democrats and neoconservative Republicans had been desperately seeking since in October, after many months of negotiations.
The House has approved nearly $100 billion in aid to Washington’s overseas allies, partners and client states, with aid advocates overcoming strong opposition after six months of deadlocked negotiations.
Nearly $61 billion of the $95 billion in the proposed funding package is earmarked for reigniting the conflict in Ukraine (at least $23 billion of that would be spent on replenishing depleted US weapons stockpiles).
Over $26 billion in additional commitments are being made to Israel (almost eight times what Washington typically sends to Tel Aviv in a year), also $8.12 billion is committed to stoking tensions with China in Taiwan and the region Indo-Pacific wider.
Having passed the House of Representatives, the aid package now heads to the Senate, where leaders of both parties have been clamoring for months for an emergency passage of foreign aid. If it passes the Senate, the legislation will end up on President Biden’s desk for signature.
The new business model
Republican Rep. Marjorie Taylor Greene, a staunch opponent of further US aid to Ukraine, military or otherwise, offered an amendment to rescind support for Kiev.
“The United States taxpayer has already sent $113 billion to Ukraine, and much of that money is unaccounted for,” Greene said. “The federal government continues to fund the military-industrial complex, and this is a business model that requires Congress to continue to vote money to fund foreign wars. This is a business model that the American people do not support. American citizens do not support a business model based on blood, murder, and war in foreign countries while this same administration does nothing to secure our borders. The American people are over $34 trillion in debt and the debt is growing by $40 billion every night while we all sleep. Yet nothing is being done to secure our borders or reduce our debt.”
Pointing to polling showing a majority of Americans disapprove of new aid to Ukraine, Greene pointed out that Congress chose to vote to “protect Ukraine” instead of protecting “the American citizens who pay your paycheck.” “Ukraine is not even a member of NATO. But the most important thing you hear in Washington, is that we need to send the hard-earned dollars of American taxpayers to Ukraine and keep the money, to continue murdering Ukrainians, to wipe out an entire generation of Ukrainian men. What kind of support is this? It’s disgusting,” the Republican senator emphasized.
The new form of globalization
What the government is attempting, as Greene alludes to, is a return to state protectionism centered on the defense industry. The Tik Tok ban nonsense with China’s digital wiretapping accusations to the 100+ billion takedown of the semiconductor industry to (don’t lose the AI game) and protectionist policies for the metal industry (iron and steel) among others, they respond to a new reality that is being formed.
Supply chains are being rearranged globally under the pressure of geopolitical changes and the US military/industrial establishment is keen to play a new role in the manufacturing base of the US economy and the energy sector has benefited by selling e.g. expensive LNG to Europe – which wants to wean itself off cheap Russian.
In a word: we have the partial renationalization of economies, i.e. the productive base under the pressure of security provisions (defence, energy or food, or in terms of raw materials) with the removal of the economic freedom that had been achieved in the first phase of of American globalization under American hegemony. This results in debt generation and increased central control of the economy through either protectionist policies or inflationary money printing by the Federal Reserve.
The bill, of course, will go to the people – a middle class that has seen its incomes and asset values destroyed by the rampage of persistent inflation.
Prolongation of anxiety over Ukraine
The tens of billions of dollars in new US aid granted through legislation passed by the House of Representatives may prolong the Ukrainian crisis, but they will not be able to ensure a victory for NATO in the proxy war against Russia.
The money going to Ukraine will mostly likely go to US defense industry contractors in various states, but to build newer equipment for our own stockpiles, which will then allow the US to offload older hardware for Ukraine. It will not be enough for Ukraine to overcome its current geostrategic position at this point, simply because they do not have a fixed weapons capability. Along with the weapons themselves is the ability to find the human, something the Kiev regime is finding increasingly difficult to do. Other money to be provided to Ukraine is intended to pay state employees.
Of the $61 billion allocated, $45 billion will be redirected primarily to the US and $16 billion will be sent to Ukraine as so-called direct aid. Presumably the $16 billion arriving in Ukraine will be immediately absorbed to pay government bills, not the war effort. Essentially, to cover part of Kiev’s huge fiscal deficit.
They have no means of launching a counter-attack and just given the amounts of ammunition they are consuming, what even the US is proposing would probably last no more than six months at best. And it is uncertain what Europe will be able to offer. Ukraine is essentially over. It’s just a business – “mopping up” the remains for the Russians. And it will take time for that reality to sink in on Zelensky, who should start thinking about getting out of there quickly, because I don’t think the country will last much longer in his political power.
The productive weakness
In terms of direct support for Kiev, the US does not have the existing weapons, nor the production capacity to outflank Russia, with Ukraine’s military resorting to desperate tactics such as strikes targeting Russian infrastructure. This is not going to change the developments in the military field, in any way, for Ukraine. Every time Ukraine does, the Russians seem to come back with about three times the power. There is a message to the Ukrainians that they need to sort this situation out and try to keep the gains.
No quantity of weapons can save Ukraine
There is really “no amount” of other munitions and weapons that Ukraine could take at this point and remain intact. Expectations that the US will be able to solve shortfalls in artillery shells and air defense missiles by pouring more money into production are far from realistic, and we found that out two years ago with the news of actual production rates of ammunition and missiles.
The U.S. defense industry system is not geared toward high-volume production of lower-value-added items, but toward low-volume, high-cost units that have lifetimes, maintainability, and logistical support through upgrades. Apart from the US, Europe is not in a financial position to deal with the Ukrainian crisis in the long term.
Europeans have their own problems now as a result of this crisis and are trying to come back economically and politically and regain the quality of life they had before. But right now, Europe is in recession. It rearranges the supply sources of energy products. And it will take a lot of time and a lot of money to regain energy security. What they had before it is doubtful that they will be able to recover on any short-term basis.
Europe has its problems and the US has its problems, and we are trying to revive a dying case.
The betrayal
House Speaker Mike Johnson has “betrayed” the conservative wing of the party and voters by prioritizing aid to foreign countries over the crisis on the southern border. It is certainly true that some on the right feel that President Johnson has “betrayed” them. A portion of the Republican base and those on the right wing have long been unhappy with what is now often referred to as the “one party.”
The term refers to the idea that many elected Democrats and Republicans are more interested in maintaining their government power and position than in the interest of the people.
Despite controlling the Senate, there doesn’t seem to be much Republicans can do in the House. Sometimes they can delay votes, but beyond that nothing else.
In addition, proponents of aid for foreign wars can count on a sense of “urgency” in Washington regarding funding and the comparative “ease” with which it can be sent, something that proponents of foreign aid cannot count on. urgent measures to limit the migration crisis.
There is an urgency associated with aid to Israel and Ukraine that does not seem to exist in the border situation. For both countries the lack of aid could dramatically affect the wars they are involved in.
The conclusion is the following: the aid of 60 billion will mainly concern the rearrangement of the military-industrial network of the USA, while the Ukrainians will die until one for the benefit of the interests of the West.
