Plummeting oil prices are the shot heard ’round the world, and the crisis in Russia is no exception. Sanctions imposed upon Russia from Europe and the United States have worked in a disastrous duet with low oil prices to bring Russian into a financial crisis comparable to their dilemma of 1998. In the late ’90s, Russia ran out of money reserves and dumped its debt, causing global financial upset.
The Russian Central Bank has managed a cliffhanger to the tune of a $100 billion trade-off with the People’s Bank of China for $24 billion. This is simply a band aid measure, the bleed is only beginning. In fact, the deadly combination of sanctions and low oil prices could end up to be more than the US and Europe ever imagined when they lowered the sanctions boom. Russia could, once again, be unable to pay its debt, resulting in considerable global financial crisis, particularly to the euro.
Sanctions seem the only sensible recourse against Russian aggression, as neither the US or Europe is willing to risk war with Russia to force changes. Unfortunately, sanctions today backfire on the very countries imposing them. Russian sanctions and their teetering economic results threaten to undo the stability of the eurozone. In the perfect storm of events, Russian nationalism now looms over the EU as a geopolitical ideology of strong ethnic leanings and threats of military force.
In a bold and sacrificial advance, the Ukraine has reinvented itself through proposals to embrace the EU’s concepts of trade and democracy, as well as shown willingness to defend its territory from Separatist and Russian aggression. In so doing, nothing is guaranteed. The old state bureaucracy is solidly dug in, and content to ride the wave of a business oligarchy. Russian president Vladimir Putin vows to wipe out the new Ukraine before it gets off the starting block and before it can set any examples of independence.
In a thoughtful chess move, George Soros has proposed bolstering the Russian-besieged Ukrainian government. The proposal is based upon the premise that assisting the Ukraine to defend itself and prosper would put the brakes on Russian nationalistic conquest and force Valdimir Putin to recognize the EU’s international rule of law. The loss of a functioning Ukraine could have huge consequences for the EU, none of them good. Russia’s rule of force would overshadow any rule of law implemented.
Per George Soros Ukraine‘ plan, if Europe would come to the new Ukraine’s assistance with finances to fund the fledgling government, a new, democratic and prosperous Ukraine would present an example of reason and democracy and a strong partner in a strategic location for Europe. This could present the world with a new and vital Russia, as the effects of reform become economically viable.
Learn more about George Soros: