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Prof. ST Hsieh

Director, US-China Energy Industry Forum


[email protected]

January 30, 2022

It is January 31, 2022, in China already, it is the Chinese New Year Eve. China will celebrate the Year of Tiger following long Chinese tradition. Tiger is considered by Chinese as King of the mountains; it roars with authority and commands respect. There was an award-winning Chinese Movie titled Crouching Tiger, Hidden Dragon ( Wò hǔ cáng long)around 2000. It was a popular movie grossing $213.5 million worldwide. At that time, China’s gross GDP was about US$1.2 Trillion. China was ranked no. 6th in the world below Japan, Germany, France, and the US at US$ 9.7Trillon. No one was taking China seriously as a global power. Tiger and Dragon are nothing but movie themes for entertainment. Twenty-two years later, many global powers “Have Grabbed the Tail of Chinese Tiger!” Often, China has been blamed for anything wrong around the world.

For example, the US-Russia conflict over Ukraine has few Chinese angles. Even China has no troops near Ukraine border, and China is not actively engaged one way or the other. There was the news report that the US had asked China to influence Russia. It was quickly rebuked by China. It is not clear at all that China can play any role in this crisis. But China is an important factor for US strategist. The following (edited) Fox news report today makes sense.

China will impede vital US strategy to stop Ukraine-Russia conflict: Former defense official

Peter Aitken Sun, January 30, 2022, 4:36 AM

Any economic sanctions NATO imposes against Russia will have minimal impact since China would provide relief in an effort to embarrass the U.S., a former defense official told Fox News Digital.

Diplomatic discussions stalled this week after U.S. Secretary of State Antony Blinken provided a handwritten response to Russian demands. Kremlin spokesperson Dmitry Peskov said Thursday that the response offered “little ground for optimism” but acknowledged “prospects for continuing dialogue.”

The U.S. has threatened to hit Russia with sanctions – both on the state itself and against individuals, including President Vladimir Putin – should it proceed to invade Ukraine.

But Robert L. Wilkie, Under Secretary of Defense for Personnel and Readiness during the Trump administration, said that any such economic punishments would not provide the kind of impact American officials believe it will due to Russia’s strong bond with China.

“A lot of the talk about economic sanctions is really a pie in the sky because China is now Russia’s banker,” Wilkie argued. “Xi Jinping will back Putin if sanctions from the West come.”

“That’s a safety net he probably didn’t have 10, 15 years ago, and China probably wasn’t capable of buttressing the Russian state as it is now,” he added.

U.S. sanctions on Russia – which might include cutting off Moscow’s access to SWIFT and related world banking funds – might simply push Russia to instead increase sales of oil and gas to China: Russia in 2020 accounted for 15.5% of China’s imported crude oil, according to Worlds Top Exports. That currently makes Russia the second-biggest oil and gas exporter to China.

“[China] would start buying a lot more energy from Russia,” Wilkie explained. “If we went to move on the SWIFT loan system that gives Russia access to western capital, China would pick up the slack with that.”

“Even if the Germans were to do an about-face on the Nord Stream 2, China would pick up the slack – they need the energy as much if not more than Europe does. That’s how I would see that playing out,” he said.

China is willing to help anyone as long as that diminishes the United States in the eyes of the world,” Wilkie said.

That dynamic may even impact Putin’s plans for invasion: Recent intelligence suggests that Russia may take military action by mid-February, but some have pushed back on those suggestions in the belief that Putin would not want to upset China by doing so during the Beijing Winter Olympics.

STH Comments

Obviously, Wilkie, who worked for Trump administration, would not be kind to Biden and his administration. But it is not clear that his remarks offer any definite direction for Biden on moving forward in Ukraine: war or peace?

Further, there are no consolidated position within the US on how to move forward. The following (shortened) article from The Hill made it clear. First, the title is telling: Russian Crisis but nothing about Ukraine.

The Memo: Russian crisis reverberates through Washington

Sun, January 30, 2022, 4:00 AM

The alarms are growing louder about the Ukraine crisis – and questions are becoming sharper as to how the issue will reverberate through American domestic politics.

A full-scale Russian invasion would pitch President Biden into new turmoil. The failure to prevent such a move would be regarded as a diplomatic failure by the White House. It would be another foreign policy misstep to add to the chaotic withdrawal from Afghanistan last year.

But Republicans are also divided on Ukraine, with some the most pro-Trump elements of the GOP voicing isolationist sentiments. Their views complicate the GOP’s traditional hawkish image.

Biden has ruled out directly involving U.S. troops in a ground war in Ukraine, even in the event of a Russian invasion. And he has the challenge of keeping NATO allies on the same page if Russian President Vladimir Putin mounts some kind of aggressive operation that stops short of a traditional, full-on military assault.

The messy domestic picture stands against a stark reality – expectations are rising that Putin will press ahead in some shape or form.

But one pressing political question is whether Biden will play a political price at home for a failure of diplomacy if Putin presses ahead.

Robert Wilkie, a former secretary of Veterans Affairs and, before that, an under secretary of Defense during the Trump administration, faulted the Biden administration, saying that “we haven’t been playing the long game while Putin has.”

Wilkie, who was also assistant secretary of Defense under former President George W. Bush and is now a visiting fellow at the conservative Heritage Foundation, argued that there were longer-term moves the administration could make to constrain Putin, such as “opening up an avenue for Finland and Sweden to come into the NATO family” to help change the overall dynamic in Europe.

But he also noted there were real difficulties, not least Russia’s increasing closeness with China, which he argued made sanctions less likely to be effective.

“Unlike in the past, Putin has a banker now – and that’s Beijing,” he said.

Liberal voices are of course more supportive of Biden’s position, arguing that he has played his hand as well as he could, including making clear to Putin that there will be severe consequences for an invasion.

“The U.S. does have a number of tools that it can use that would be really painful for the Kremlin and potentially catastrophic for Russia overall,” said Max Bergmann, a senior fellow and the director for Europe and Russia at the liberal Center for American Progress.

But Bergmann added, “We should not think of this as a way to find a silver bullet that will cause Vladimir Putin to not invade or to say, ‘Uncle.'” He argued Putin had painted himself into a corner with his troop buildup and would have to go ahead with some form of action at risk of losing face.

Russia denies it has any intention of invading Ukraine, assurances that are dismissed in Washington because of the troop movements. The Kremlin wants a formal commitment that Ukraine, which is not a NATO member, will never be allowed to join the alliance. But that kind of guarantee is a non-starter with the U.S. and other Western nations.

Complicating the political calculus at home are the Trump Republicans.

Rep. Paul Gosar (R-Ariz.) has contended that “we have no dog in the Ukraine fight.” A recent story from Axios noted the influence of Fox News broadcaster Tucker Carlson, who has been openly skeptical about the need for the U.S. to get involved on Ukraine’s side. The website also noted a number of GOP candidates who have sounded similar themes.

Those positions sit very uneasily with the GOP’s traditional hawkish image. They also draw scorn from liberal foreign policy experts, who accuse Trump Republicans of giving comfort to an adversary.

“Protest is fine, disagreement on policy is fine, but active support for Putin’s expansionist policies, including the potential invasion of another democracy, give confidence to Putin that he has effectively undermined the American president at home,” said Joel Rubin, a former deputy assistant secretary of State during the Obama administration.

Some polling shows the peculiar contours of U.S. public opinion in relation to Ukraine. An Economist-YouGov poll released last week, for example, indicated more Republican voters than Democratic voters consider Putin a “strong leader.”

Asked whether it was more important for Washington to “take a strong stand” on Ukraine or “maintain good relations with Russia,” voters of both parties went for the first option.

“I think [Putin] is going to do it,” said Bergmann. “Once you put this in motion, it can be hard to unwind it without losing face and credibility. … He could just leave forces where they are. But, yeah, I would be nervous.”

The Memo is a reported column by Niall Stanage.

STH Comments:

While the US is calling for war in Ukraine without a clear path forward. Ukrainian ambassador: “We cannot afford to panic” over Russian aggression Melissa Quinn

Sun, January 30, 2022, 8:16 AM

Washington — Ukraine’s Ambassador to the U.S. Oksana Markarova said Sunday that Ukraine “cannot afford to panic” over the ongoing crisis with Russia and its military buildup along Ukraine’s borders, but is aware of Moscow’s capabilities.

“At the same time, in order to defend our country, we cannot afford to panic. We have to get ready, all of us, not only our military, our very capable military and veterans, but also all civilians.”

While the Biden administration and U.S. allies have warned a Russian invasion of Ukraine is “imminent” given the build-up along Ukraine’s borders, Ukrainian President Volodymyr Zelenskyy has called the escalation by Russia an act of “psychological pressure.”

Ukraine, though, has been pushing for sanctions on Russia now in response to its 2014 invasion of Crimea, as well as in the future should Putin order an attack.

“There are reasons to continue sanctioning Russia for their attack that already happened,” Markarova said.

President Biden told Zelenskyy during a call Thursday that the U.S. is also “exploring additional macroeconomic support to help Ukraine’s economy amidst pressure resulting from Russia’s military build-up,” according to a readout of the conversation from the White House.

STH: Summary

  1. The Ukraine crisis is a minor part of global geopolitical play between the US and Russia. However, it is not a clear cut of war or peace, either way there is a price to pay by the US as well as Russia. Of course, there are gains too, long term as well as short term. For the US strategists in charge of executing foreign policy, it seems the gain is focused on the short-term gain, and it is narrowly about the Biden Administration. This is the main reason that the US does not have a “long game” plan and any short-term game plan does not have the support of both parties.
  2. On the other hand, the US underestimates Putin’s wisdom, strategy, decision-making process, and vision for Russia. The US historically assumed that Russian leaders are selfish and ruthless, they have no interest in the future of Russia as a nation or as people. An example is that the US now considers sanction Putin himself if Russia invades Ukraine. A potential side effect is it will unify Russians under Putin’s leadership. In fact, US may have to deal with Russia nation as an Archie enemy.
  3. China does have a direct role in resolving the Ukraine crisis. But the state of play is that President Putin will meet/consult with President Xi very soon in person. On the other hand, the US does not seem to engage China at all and concedes that China has already committed to Russians. Is it true?

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