As a follow up to my earlier post us-nationalises-banks-while-russia-devalues-the-rouble-total-irony pointing out the sharp reversal in political and economic fortunes of the (former) two world superpowers, I remembered something from last month.

An American friend decided to post a present for my family here in the UK.  I (and then we) ended up having to pay import tax on the gift of about forty quid! It was only worth two hundred….

This is due to the fact that the USA, land of free enterprise, refuses to abide by WTO free trade rulings so that the EU, quite legally, slaps on a whack of tax to discourage purchasing and importing from the USA!

These are two files detailing the list of items affected.

So behind all the huffing and puffing over Georgia and the stranglehold that Russia can exert on European energy supplies, the EU and the USA have had their own private battle going on for years – and there’s hardly a mention in the press!

It does bring into focus the notion that the USA is a land of free enterprise though.  They’ve nationalised the two biggest financial institutions (handling trillions of dollars) and employ trade embargoes to protect their industry.  Because of their profligate use of natural resources in the past, the only method of leveraging opinion in the world nowadays is that of swaggering military power.  Gunboat diplomacy in the old parlance.

But when this approach is tried on Russia, it falls woefully short of success.  To illustrate how the real way to wield power in the world has changed, cast your mind back to March this year (2008), and follow the timeline of events in the Ukraine…

• 26 Feb 2008: Gazprom threatens to cut gas supplies to Ukraine by 25% from 3 March unless Ukraine agreed to pay it’s arrears.
• 3 March 2008: Gazprom cuts Ukraine gas supply.  – notionally 25% but actually a 35% cut!
• 5 March 2008: Gazprom restores Ukraine gas flow – Ukraine pays up!

Of course, GazProm isn’t a real company like you or I might own, any more than Fanny Mae and Freddie Mac are in the USA.  They are all tools of the state, controlled by very few people indeed.  Notionally these people are elected in free and fair elections but neither Bush, Putin or Medvedev can claim any sort of moral high ground on this point, which is why they don’t browbeat each other over the issue.

Instead, we see a tit-for-tat kind of dialogue worthy of a children’s playground over issues, that if history is repeated, could be very serious for us all.

Compare and Contrast:

So though the timeline of events is in a slightly different order, the potential for a repeat of history is very great.

But surely, surely people wouldn’t be so stupid, would they?

Surely.

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