Archive for foreign policy

Protectionist Politics at the WTO

Geneva_Ministerial_Conference_18-20_May_1998_(9305956531)

The WTO meets.

Amidst news of the prolonged worldwide recession, new air strikes, secession attempts, and climate change, international trade—which in 2008 went through its largest crisis in history—has been mostly out of the public eye.  Yet we’ve been told not to fear: the World Trade Organization, the foremost global body for promoting multilateral trade, remains watchful, and is optimistic that efforts for liberalization will bear fruit in the near future.

Sadly, the WTO’s hopes aren’t justified: the Doha Round of trade negotiations began in 2001, and even after thirteen years, success is nowhere in sight.

Seeking to address the liberalization concerns of WTO’s less-developed members, the Doha Development Round was supposed to culminate in 2005 with a new trade agreement. The envisioned deal concerned the reduction of trade barriers in commodities and services, as well as a new international framework for intellectual property rights. But soon after negotiations began, governments from developing countries—India, Brazil, China, and South Africa—and NGOs began to worry that international negotiations were an obstacle to the governmental protection of developing sectors and regulation of financial services. After the failure of the Cancún proceedings in 2004, trade scholars worried that Doha might not be completed by its original deadline, but kept the hope that negotiations would continue. However, trade talks came to a deadlock in 2006, 2009, and 2011, mainly due to differences in agricultural policies. The US and the EU even backed out of previous agreements to reduce export support and agricultural subsidies, arguing that they did not want to weaken their bargaining positions too early in the Round.

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Ron Paul on the Latest Anti-Russia Sanctions

WTC-MoscowFrom a free-market perspective, trade sanctions are always immoral and illegitimate because they restrict trade and free choice among individuals. Arguably, they are even worse when instituted for purposes of provoking war, as is the case with the Obama administration and Russia. Ron Paul examines the current controversy:

Why Won’t Obama Just Leave Ukraine Alone?

by Ron Paul

President Obama announced last week that he was imposing yet another round of sanctions on Russia, this time targeting financial, arms, and energy sectors. The European Union, as it has done each time, quickly followed suit.

These sanctions will not produce the results Washington demands, but they will hurt the economies of the US and EU, as well as Russia.

These sanctions are, according to the Obama administration, punishment for what it claims is Russia’s role in the crash of Malaysia Airlines Flight 17, and for what the president claims is Russia’s continued arming of separatists in eastern Ukraine. Neither of these reasons makes much sense because neither case has been proven.

The administration began blaming Russia for the downing of the plane just hours after the crash, before an investigation had even begun. The administration claimed it had evidence of Russia’s involvement but refused to show it. Later, the Obama administration arranged a briefing by “senior intelligence officials” who told the media that “we don’t know a name, we don’t know a rank and we’re not even 100 percent sure of a nationality,” of who brought down the aircraft.

So Obama then claimed Russian culpability because Russia’s “support” for the separatists in east Ukraine “created the conditions” for the shoot-down of the aircraft. That is a dangerous measure of culpability considering US support for separatist groups in Syria and elsewhere.

Similarly, the US government claimed that Russia is providing weapons, including heavy weapons, to the rebels in Ukraine and shooting across the border into Ukrainian territory. It may be true, but again the US refuses to provide any evidence and the Russian government denies the charge. It’s like Iraq’s WMDs all over again.

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Mises Weekends: Justin Raimondo Describes His Battle Against the War Machine

Jeff Deist and Justin Raimondo discuss the early history of the modern libertarian movement, Justin’s time working with Murray Rothbard on libertarian strategy, and the chances for developing a broad new anti-war coalition.

Also available here:

iTunesU: https://itunes.apple.com/us/itunes-u/mises-weekends/id884207568
Mises.org: http://mises.org/media/8596/Justin-Raimondo-Against-the-War-Machine
Stitcher: http://www.stitcher.com/podcast/mises-institute/mises-weekends

Lew Rockwell on the Military Domination of the American Mind

Tom Woods writes:

Lew and I spoke on my show again today, this time focusing primarily on war, the military culture in American society, state propaganda, and other juicy topics. Click here for the audio of the show, and below is the show on YouTube.

(N.b.: My last public event before heading to the Mises Institute for the summer Mises University program is this Thursday in St. Paul, Minnesota.)

On The 128th Anniversary of Randolph Bourne’s Birth

BarrantiRandolphBourneRandolph Bourne, the antiwar intellectual who contended that “war is the health of the state” was born today, May 30, in 1886.

Bourne’s monograph The State, published posthumously, is available here at Mises.org. Bourne authored several other insightful pieces as well, are are collected in the 1964 collection War and the Intellectuals

Wendy McElroy examines Bourne’s legacy here, and Jeff Riggenbach provides additional details :

Randolph Bourne was an American intellectual journalist who flourished for a few years in the second decade of the 20th century — in the Teens, the decade that ran from 1910 to 1920. Bourne wrote mostly for magazines during this period. His byline was particularly familiar to readers of The New Republic — until his radically antiwar views on the eve of the US government’s intervention in World War I got him fired.

He moved over to The Seven Arts, a newly launched magazine with a smaller circulation than The New Republic and one less well suited to Bourne’s particular talents and interests, since its primary focus was the arts, rather than social and political issues. He was able to publish only six antiwar articles in The Seven Arts before its doors were closed by an owner fearful of the Wilson administration and its Sedition Act of 1918, which made it a crime to criticize the Constitution, the government, the military, or the flag.

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Why They Hate Peace

6755Ron Paul writes in this weekend’s Mises Daily:

Some believe economic sanctions and blockades are acceptable alternatives to invasion and occupation. But these too are acts of war, and those on the receiving end rarely capitulate to the pressure. More likely they remain bitter enemies, and resort to terrorism when unable to confront us in a conventional military fashion.

Inflation, sanctions, and military threats all distort international trade and hurt average people in all countries involved, while usually not really hurting the targeted dictators themselves. Our bellicose approach encourages protectionism, authoritarianism, militant nationalism, and go-it-alone isolationism.

Ron Paul: What Does The US Government Want in Ukraine?

data=VLHX1wd2Cgu8wR6jwyh-km8JBWAkEzU4,ASWA9xT640ikUa1SD750pfpnD84jAZbzLQ-cOPDCaXc0ylcgdxpWUIy9-N6V_k5vTtLwNaB7jcAtgnZzZ-VMW43zoTKaUrvciDIq2wjmlJr4AvXMT5P2O9mb9c57eA19SqWXY8PJJ6mhilw4226d6NagIGqUkUd-PCYd-Q_MhlalqAKJ5BKKAfter reviving conscription, killing protestors in Odessa, and seizing ballots in eastern Ukraine, agents of the Ukrainian state now denounce organizers of the plebiscite in eastern Ukraine as “terrorists.”

“The farce, which terrorists call the referendum, is nothing more than propaganda to cover up murders, kidnappings, violence and other serious crimes,” Ukraine’s acting President Oleksandr Turchynov said in a statement.

Gee, sounds legit. Or, it may just be yet another case of a state throwing a temper tantrum any time a group of citizens try to determine their political future for themselves through decentralization or secession. Even if the separatists are guilty of serious crimes, the full extent of their crimes is surely tiny when compared to those of the Ukrainian state (and virtually all states).  Read More→

Ron Paul: Aid to Ukraine Is a Bad Deal For All

3134323442_52a9009ce7_oBy Ron Paul

 

Last week Congress overwhelmingly passed a bill approving a billion dollars in aid to Ukraine and more sanctions on Russia. The bill will likely receive the president’s signature within days. If you think this is the last time US citizens will have their money sent to Ukraine, you should think again. This is only the beginning.

This $1 billion for Ukraine is a rip-off for the America taxpayer, but it is also a bad deal for Ukrainians. Not a single needy Ukrainian will see a penny of this money, as it will be used to bail out international banks who hold Ukrainian government debt. According to the terms of the International Monetary Fund (IMF)-designed plan for Ukraine, life is about to get much more difficult for average Ukrainians. The government will freeze some wage increases, significantly raise taxes, and increase energy prices by a considerable margin.

But the bankers will get paid and the IMF will get control over the Ukrainian economy.

The bill also authorizes more US taxpayer money for government-funded “democracy promotion” NGOs, and more money to broadcast US government propaganda into Ukraine via Radio Free Europe and Voice of America. It also includes some saber-rattling, directing the US Secretary of State to “provide enhanced security cooperation with Central and Eastern European NATO member states.”

The US has been “promoting democracy” in Ukraine for more than ten years now, but it doesn’t seem to have done much good. Recently a democratically-elected government was overthrown by violent protestors. That is the opposite of democracy, where governments are changed by free and fair elections. What is shocking is that the US government and its NGOs were on the side of the protestors! If we really cared about democracy we would not have taken either side, as it is none of our business.

Washington does not want to talk about its own actions that led to the coup, instead focusing on attacking the Russian reaction to US-instigated unrest next door to them. So the new bill passed by Congress will expand sanctions against Russia for its role in backing a referendum in Crimea, where most of the population voted to join Russia. The US, which has participated in the forced change of borders in Serbia and elsewhere, suddenly declares that international borders cannot be challenged in Ukraine.

Those of us who are less than gung-ho about sanctions, manipulating elections, and sending our troops overseas are criticized as somehow being unpatriotic. It happened before when so many of us were opposed to the Iraq war, the US attack on Libya, and elsewhere. And it is happening again to those of us not eager to get in another cold — or hot — war with Russia over a small peninsula that means absolutely nothing to the US or its security.

I would argue that real patriotism is defending this country and making sure that our freedoms are not undermined here. Unfortunately, while so many are focused on freedoms in Crimea and Ukraine, the US Congress is set to pass an NSA “reform” bill that will force private companies to retain our personal data and make it even easier for the NSA to spy on the rest of us. We need to refocus our priorities toward promoting liberty in the United States!

[The Ron Paul Institute]

An Economic Interpretation of the Crimean Secession/Annexation

800px-Ялта_Южный_берег_ДДимаAs with the Venetian secession, regions of larger states often secede because they resent being taxed to subsidize other regions of the country. Less often is the case that a region leaves one nation state because it can get more and better subsidies in another nation states. According to Jason Ditz at antiwar.com, however, this is a big factor in Crimea’s decision to leave Ukraine for Russia. And if Ditz’s assertions about Crimea’s poverty and economic dependence are right, we might also extrapolate that Crimea’s poverty could be a reason that true independence was not on the table.

While not quite the same, this phenomenon might be compared to situations in which client states bolt one sphere of influence to join another. The US understands this as well as anyone, since it spends many billions annually in cash or in-kind gifts to cultivate close ties with a variety of brutal dictatorships like those found in Egypt and Saudi Arabia.

But on the Crimean question, Ditz writes:

I love a good argument too, but I think the Crimea situation is less about race, nationalism and the East-West divide than it is economics.

Crimea is dirt poor, even by Ukranian standards, and was intensely dependent on government aid. The regime change brought about a lot of philosophical shifts in government, but the big change from the Crimean perspective was economic in that:

a) Ukraine’s struggling economy is heading further into the ditch, with EU trade ties likely not to make a major difference for years and the loss of Russia trade ties likely to be a quick impact.

b) The IMF bailout came amid intense conditions of austerity, which means Crimea’s subsidies were likely to be on the chopping block .

Whatever else one may say about Russia’s economy, it’s got a lot of money from oil and gas exports, and they were in a position to not only replace the aid Ukraine had been giving Crimea, but to increase it considerably. I’d say you can’t buy that kind of loyalty, but you clearly can.

Interviews on the streets with Crimeans told similar stories, of local retirees expecting their pensions to go from $100 a month under Ukraine to $500 a month under Russia. Similar pay hikes were expected for soldiers who transferred to the Russian military, and they played a big role in the sheer size of the defections.

From Russia’s perspective, it’s also a pretty straightforward economic move. They kept the Yanukovych government close with billions in subsidies and loans for all of Ukraine, and with the regime change removing that option and the Sevastopol base the only real asset Russia needs to keep, it is much easier to just buy Crimea’s accession into the Russian Federation (which will cost Russia billions annually anyhow) than it was to try to get another Yanukovych elected.

Historical claims to the peninsula certainly provided a pretext for the secession/annexation, and are interesting from an academic perspective, but if Ukraine wasn’t broke I don’t think we’d be having this discussion at all.

Another Bailout of Lenders, This Time in Ukraine

National Bank of Ukraine

National Bank of Ukraine

By Michael S. Rozeff 

The IMF is lending $18 billion to Ukraine’s government, so that it can pay one small part of its huge debts. The money will go to the lenders, which include banks, mainly in Europe, and other investors in Ukraine’s bonds. This will not stem Ukraine’s economic decline. The IMF’s price includes higher taxes, which will make it worse.

There are several possible recipes for reviving Ukraine’s economy. One of them is to mimic the German miracle. Ludwig Erhard understood how to do it. See here and here and here.

Another avenue is to repudiate the debt and start over again with sound policies that basically disallow the government from borrowing anything except perhaps seasonal borrowing against that year’s tax receipts, to be cleaned up for at least one month each year so that there’d be a no-debt period.

As a general rule, no government should ever borrow anything on a permanent basis. Allowing that is to allow a government to spend now and tax future generations. Clearly it has a huge incentive to do exactly that if it can borrow in anything but seasonal debt. One state after another then gets into the situation of either excessive debt or a depreciating currency or both.

One of the more amazing things about the world at present is that the major robberies accomplished by its states are done right out in the open and celebrated. Furthermore, institutions like the IMF that fail time and again, even report their failures in great detail before repeating them anew. For example, the IMF has a 51-page report explaining its failures in its Greek loan program.

Another amazing thing is that people like Erhard are ignored. Here is a government official who has succeeded in creating an economic miracle in Germany and who has explained how he succeeded in lucid prose. Any country’s government can imitate what he did, but they do not. And the IMF is an added inducement to ignore appropriate policies that encourage economic growth.

More: LewRockwell.com, March 27, 2014

Ron Paul, Richard Cobden, and the Risks of Opposing War

Ukraine conflictRyan McMaken writes in today’s Mises Daily: 

For those who can remember the lead up to the Iraq War in 2003, this should all feel like déjà vu since many at that time, including some libertarians, claimed that opponents of invasion were “pro-Saddam Hussein” for pointing out that Iraq clearly had no weapons of mass destruction, and that his secular regime was probably preferable to the murderous Islamist oligarchy that has replaced it.

Paul remains in good company with the likes of Cobden, H.L. Mencken, William Graham Sumner, and virtually the entire membership of the American Anti-Imperialist League, including Edward Atkinson who encouraged American soldiers in the Philippines to mutiny. These were radical principled opponents of militarism who opposed government violence at great risk to themselves and their reputations. Some modern American libertarians, on the other hand, well out of reach of the Russian state, would rather spend their time stating what everyone already knows: Russia is not a libertarian paradise.

 

The ‘Pro-Russian’ Libertarian Position of Richard Cobden

Richard_Cobden (1)Richard Cobden, the great libertarian of the 19th century, man of peace, leader of the Anti-Corn Law League, and anti-imperialist, was once considered in line to be Prime Minister. Yet, like so many libertarians after him, he was destroyed for his opposition to nationalism and war. In Cobden’s case, his opposition to the Crimean War sent his political capital into a tailspin as not only the ruling classes savagely attacked him, but he was also abandoned by the liberal rank and file and who had supported his economic positions, but who shunned Cobden once he refused to jump on the war-hysteria bandwagon. One of Cobden’s great “crimes,” according to his critics, was that he was an apologist for the Russian Empire. Cobden was no such thing, of course, but Cobden’s recognition of the motivations behind Russian actions in Europe and Crimea earned him condemnations from narrow-minded liberals who were more concerned with criticizing the Russians (who of course couldn’t have cared less what the British liberals thought) than with criticizing the British Empire, a leading source of political instability and despotism worldwide.

Writings like this, in which Cobden simply examines the Russian point of view on the Polish and Crimean questions, while pointing to the British Empire’s own imperialism, did not earn Cobden any friends:

Lord Dudley Stuart (whose zeal, we fear, without knowledge, upon the subject of Poland, and whose prejudice against Russia have led him to occupy so much of the public time uselessly upon the question before us), in the course of his long speech in the House of Commons (February 19th) upon introducing the subject of Russian encroachments, dwelt at considerable length upon the lust of aggrandisement by which he argued that the government of St. Petersburg was so peculiarly distinguished; and he brought forward, at considerable cost of labour, details of its successive conquests of territory during the last century. Where the human mind is swayed by any passion of however amiable a nature, or where the feelings are allowed to predominate over the reason, in investigating a subject which appeals only to the understanding, it will generally happen that the judgment is defective. We attribute to the well-known fervour of Lord Stuart’s sentiments upon Russia and Poland, the circumstance that, during the fortnight which he must have employed in collecting the dates of the several treaties by which the former empire has wrested its possessions from neighbouring states, the thought never once occurred to him—a reflection which would have entered the head of almost any other man of sense, who sat down coolly to consider the subject—that, during the last hundred years, England has, for every square league of territory annexed to Russia, by force, violence, or fraud, appropriated to herself three. Such would have been the reflection which flashed across the mind of a statesman who sat down, dispassionately, to investigate the subject of Russian policy;

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A Lifetime of War—Explained

760px-ACAV_and_M48_Convoy_Vietnam_Warby Kirkpatrick Sale

[LewRockwell.com, March 25, 2014]

A few days ago, my partner, turning from something about Afghanistan on the television news, said to me, “It seems there’s been a war going on as long as we’ve been alive.”

And we’re well into our 70s.

But think about it: she’s almost right.  This country has been at war, or at least has deployed troops, every year since 1940, when we were tots, except for occasional sporadic periods of quasi-peace amounting in all to about 18 years. Not our whole lives, but three-quarters of it.

Let’s do a little of the history.  In 1940 we deployed troops throughout the West Indies, to protect those countries and free British troops, and the next year we took over Greenland and Iceland militarily. The next five years saw world war, and after the war we had troops in Germany, Austria, Japan, and South Korea, sent troops into Greece in 1947, and used the Air Force for the Berlin airlift in 1948-49.  Then came the Korean War, Indochina, and Vietnam until 1975.  From 1960 on we sent troops to the Congo, Colombia (where they’re still at war), the Dominican Republic, Lebanon, and we invaded Grenada in 1983.

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US ‘Democracy Promotion’ Destroys Democracy Overseas

11879731476_415694913b_bby Ron Paul

It was almost ten years ago when, before the House International Relations Committee, I objected to the US Government funding NGOs to meddle in the internal affairs of Ukraine. At the time the “Orange Revolution” had forced a regime change in Ukraine with the help of millions of dollars from Washington.

At that time I told the Committee:

We do not know exactly how many millions—or tens of millions—of dollars the United States government spent on the presidential election in Ukraine. We do know that much of that money was targeted to assist one particular candidate, and that through a series of cut-out non-governmental organizations (NGOs)—both American and Ukrainian—millions of dollars ended up in support of the presidential candidate…

I was worried about millions of dollars that the US government-funded National Endowment for Democracy (NED) and its various related organizations spent to meddle in Ukraine’s internal affairs. But it turns out that was only the tip of the iceberg.

Last December, US Assistant Secretary of State Victoria Nuland gave a speechin which she admitted that since 1991 the US government has:

[I]nvested more than 5 billion dollars to help Ukraine…in the development of democratic institutions and skills in promoting civil society and a good form of government.

This is the same State Department official who was caught on tape just recently planning in detail the overthrow of the Ukrainian government.

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Ron Paul Interviewed in ‘The Guardian’ About Crimea

Here, Ron Paul discusses Crimean secession:

“That is our how our country was started,” he said. “It was the right of self-determination, and voting, and asking and even fighting for it, and seceding. Of course libertarians were delighted with the secession of the various countries and units of government away from the Soviet Union, so yes, we want the people to make the decisions.”

How World War I Paved the Way for the Warfare State

800px-Royal_Irish_Rifles_ration_party_Somme_July_1916by David Stockman

Remarks To The Committee For The Republic, Washington DC, February 2014 (Part 1 of 6 Parts)

[From David Stockman's Contra Corner.]

Flask in hand, Boris Yelstin famously mounted a tank outside the Soviet Parliament in August 1991. Presently, the fearsome Red Army stood down—an outcome which 45 years of Cold War military mobilization by the West had failed to accomplish.

At the time, the U.S. Warfare State’s budget— counting the pentagon, spy agencies, DOE weapons, foreign aid, homeland security and veterans—-was about $500 billion in today’s dollars.  Now, a quarter century on from the Cold War’s end, that same metric stands at $900 billion.

This near doubling of the Warfare State’s fiscal girth is a tad incongruous.  After all, America’s war machine was designed to thwart a giant, nuclear-armed industrial state, but, alas, we now have no industrial state enemies left on the planet. The much-shrunken Russian successor to the Soviet Union, for example, has become a kleptocracy run by a clever thief who prefers stealing from his own citizens.

Likewise, the Red Chinese threat consists of a re-conditioned aircraft carrier bought second-hand from a former naval power—-otherwise known as the former Ukraine. China’s bubble-ridden domestic economy would collapse within six weeks were it to actually bomb the 4,000 Wal-Mart outlets in America on which its mercantilist export machine utterly depends.

On top of that, we’ve been fired as the world’s policeman, al Qaeda has splintered among warlords who inhabit the armpits of the world from Yemen to Somalia and during last September’s Syria war scare the American people even took away the President’s keys to the Tomahawk missile batteries.  In short, the persistence of America’s trillion dollar Warfare State budget needs some serious “splainin”.

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Herbert Spencer, Freedom, and Empire

6688Bryan Cheang writes in today’s Mises Daily:

Accordingly, Spencer attacked the foreign military adventurism that Britain continued to engage in, since it ran counter to the spirit of liberal progress. Britain had engaged in overseas wars in India, Afghanistan, and South Africa (the Boer War), and elsewhere. He denounced the hypocrisy in imperial policy which often used euphemisms like “defensive war” to mask, what to him was the true nature of imperial aggrandizement. The following becomes clear: Spencer’s radical stance struck at the heart of the essence of empire, for it denounced the foreign occupation of colonial territories. At a time when the race for colonial lands was seen to be a prerequisite for the glory and prestige of empire, especially during the late 1800s, Spencer argued that such foreign expansionism fostered tyranny over the domestic people.

US Foreign Interventions Help Putin

443px-Bush&Putin33rdG8

By Andrew P. Napolitano

What happens when the United States government participates meaningfully in toppling foreign governments in the name of spreading democracy? That behavior usually results in unintended consequences and often produces disasters.

When the United States invaded Iraq in 2003, initially to search for weapons of mass destruction that we now know the Bush administration knew did not exist there, and eventually for regime change, the U.S. succeeded in changing profoundly the Iraqi government. But in the process, we lost 4,500 American troops, suffered 45,000 substantial injuries, borrowed and spent and have not paid back more than $2 trillion, caused the deaths of 650,000 Iraqis, displaced 2.5 million Iraqis, and unleashed into Iraq our public enemy, al-Qaida. Al-Qaida was not in Iraq before we invaded. Today, it controls one-third of that now unstable country.

In 2010, President Obama decided he no longer liked America’s favorite Middle Eastern dictator, President Hosni Mubarak of Egypt, even though he and his four immediate predecessors gave the Mubarak government about $4 billion annually. So our agents fomented revolution in the streets while Obama suggested openly that it was time for Mubarak to leave office. Then the hoped-for and promised free elections took place, and avowed enemy of the West and Islamic fanatic Mohammed Morsi became the first popularly elected president in Egyptian history. Then the U.S. decided it did not want him in power no matter the lawfulness and moral legitimacy of his election, and so the Obama administration encouraged a military coup.

Morsi was arrested by his own military commanders and is currently on trial for permitting his soldiers under those same commanders to kill nine people who were resisting the coup, even though the American-backed military plotters — who now rule Egypt and are prosecuting Morsi — have killed thousands of Egyptian civilians who attempted to resist the removal of Morsi from office. The result is a military dictatorship and murderous resistance far more odious than in the Mubarak years.

And in Ukraine in 2004, the Bush administration fomented the so-called Orange Revolution. This, too, was done by our diplomats and intelligence community, whose agents agitated demonstrators in the streets and liberally distributed American dollars to them. This resulted in a free election, which resulted in subsequent free elections, until the most recent of those produced a president who — as an ex-communist — was more drawn to Russia than to the U.S. or Europe.

When the Ukraine government needed cash and Russia offered it a better deal than the European Union, our imperial diplomats and lawless intelligence gurus were embarrassed. So, the U.S. fomented another revolution in the streets of Kiev. One of our diplomats, Victoria Nuland, acknowledged as much in a tapped and taped (complete with expletives) and eventually viral cellphone conversation. Then, Viktor Yanukovich, the popularly and lawfully elected Ukraine president, was toppled and fled to Moscow. The new unelected Ukraine president has received American recognition and help. Earlier this week, the U.S. offered him $1 billion in immediate cash.

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Robert Taft and His Forgotten “Isolationism”

6685Gregory Bresiger writes in this weekend’s Mises Daily: 

After World War II, Taft ended his career by questioning the Truman Doctrine—which committed the United States to opposing communism in Greece and Turkey as well as almost anywhere else—and later urged president Dwight Eisenhower not to send troops to Indochina to save the French. Their Asian empire was collapsing in the early 1950s. Although initially supportive of President Truman in the Korean War, Taft later complained that the president had never asked for Congressional authorization in sending troops into war. Taft also questioned the legitimacy of the UN resolution calling for American intervention.

Taft hated the term “isolationist,” but said he accepted it if it meant “isolating the United States from the wars of Europe.” Still, isolationism was a sentiment that was in the political mainstream through a large part of the 20th century.

The President’s Foreign Policy: Speak Loudly and Carry a Small Stick

-Getting_em_up-_at_U.S.Naval_Training_Camp,_Seattle,_Washington._Webster_&_Stevens._-_NARA_-_533698.tifAt the beginning of the twentieth century, President Teddy Roosevelt’s foreign policy was, “Speak softly and carry a big stick.” At the beginning of the twenty-first, President Obama’s policy appears to the the opposite: “Speak loudly and carry a small stick.”

President Obama threatened Syria not to step over a “red line” by using chemical weapons or they would face serious repercussions, but they did, without the serious repercussions. He threatened Iran if they continued their nuclear enrichment programs, but they continue as we ease sanctions on them. More recently, he warned Putin “there would be costs for any military intervention in Ukraine,” but realistically, what could he do? Everybody can see it’s big talk with no stick to back it up.

Meanwhile, Putin has indicated a retreat in Ukraine, not because of the big talk from Obama, but because Russia’s hand was slapped by the response of markets. Russian stocks fell by 12% after Russian military forces moved into the Ukraine, and the ruble took a serious hit as well. The reaction of the market had a bigger effect on Putin’s aggression than Obama’s small stick.

The discipline of the market in international affairs is not new to Russia. The Berlin Wall fell, and the Soviet Union dissolved, not because of the military might of the Cold War nations, but because of the economic strength of capitalism compared to socialism.

Because our Cold War adversaries are increasingly a part of the global economy, markets generate repercussions to belligerent actions beyond those of any prudent political responses.

I don’t expect the Russians to pull out of the Ukraine. They are still occupying a part of the Republic of Georgia after having invaded there in 2008. What I’m saying is that any moderation of Russian policy there is more directed by the market’s response rather than any international political response.

I am not too concerned about President Obama’s actual policy responses. The small stick is OK with me, and we can see in Iraq and Afghanistan what can go wrong when we try to play the role of the world’s policeman. The problem is the “speaking loudly” part, because it costs our president, and our country, some credibility when people know the president won’t follow through on his big talk.