"Winter is Coming"

It’s hard to know what the status of the Ukraine war is. Western publications will always say Russia is failing, that the Ukrainians have done remarkably well. More problematically, some things are true, but the extent of their impact is harder to gauge. Yes, the Russian army is suffering losses, but what is their morale? How would you or I know the answer to that, if all we read are Western outlets? Yes, there is Western sanctions induced chip shortage in Russia, but how badly does it affect the Russian army and the Russian public? Is it swaying Russian opinion against the war? Or is it uniting them against the West?

 

That is why I liked Andrew Sullivan’s article, which analyzes the impact on both Russia and Europe. Just because Russia isn’t winning doesn’t mean that Europe is winning. There are other options – stalemate, and ruinous costs on both sides.

 

Large parts of Europe, including Germany, were heavily reliant on Russian oil and gas. With Russia having turned off the tap, Putin has almost guaranteed the “coming energy-driven recession” in Europe. Yes, he says, Europe has taken many steps to start stocking up its oil and gas reserves. Yes, they may be trying to cut down on their consumption. But, as Sullivan says:

“The use of gas by households is trivial in the summer in Europe compared with the winter — and subsidizing the cost doesn’t help conservation. Russia will now cut off all gas — which could send an economy like Italy’s to contract more than 5 percent in one year. There really is no way out of imminent, deep economic distress across the continent. Even countries with minimal dependence on Russia, like Britain, are locked into an energy market with soaring costs.”

 

How about Russia itself?

“Russia still has plenty of ammunition to throw Ukraine’s way (even if it has to scrounge some from North Korea); it is still occupying close to a fifth of the country; still enjoying record oil revenues; has yet to fully mobilize for a war; and still has China and much of the developing world in (very tepid) acquiescence. Putin is very much at bay. But he is not finished.”

 

And who knows what will happen if Putin fears he may lose power? Would he be forced to escalate? How far would he go? What might he do?

“(This) may be why the German Chancellor remains leery of sending more tanks to Ukraine. The danger is a desperate Putin doing something, well, desperate.”

 

Predictions are risky, but here is what Sullivan expects to happen next:

“Can Ukraine be fully liberated? I have even more doubts. Will there come a moment of truth as Europe freezes in a recession this fall — and the pressure for a settlement to the war intensifies? Almost certainly.”

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