Trump’s Achilles Heel is Still Russia
Much of Trump’s bluster about raising tariffs on certain nations is just that, bluster. The US need not to be worried about BRICS nations challenging the mighty American dollar, since the dollar’s hegemonic position in the global financial system remains strong and its share of allocated reserves represents 58.22% of global foreign exchange reserves, according to the IMF.[1] This not only allows the US to borrow money more easily but it also allows the US to impose painful financial sanctions on other nations or states, like Russia, which may be why Putin called for a new international payment system at the BRICS summit last October. Trump’s threat to punish BRICS states, aggrandizes Russia, while making the US look weak; it’s this style of diplomacy, or lack thereof, that disturbs many folks in the diplomatic corps.
It’s not just a matter of losing our prominence around the world, but if the international folk wish to drop the dollar as the world’s currency, the United States would begin to see a rapid decline both at home and abroad. Last month, Trump threatened BRICS with a 100% tariff; clearly a message for Putin. Formed in 2001, BRICS began as BRIC, then in 2009, expanded to five states, originally: Brazil, Russia, India, China, South Africa; gen next: Egypt, Ethiopia, Iran and the United Arab Emirates (UAE); and, there are a few up-and-coming nations with very strong economies: Indonesia—which is in the leadership position for ASEAN states as well—Algeria, Chile, and possibly Qatar. But yelling and threatening people doesn’t inspire them; real, effective communication is the only thing that inspires people, which can only be achieved through the proper channels of diplomacy, whether through the UN or through the Department of State. The U.S. must collect appropriate intelligence in order to be both in the leadership role when asserting their position on their de-dollarization, and not allow either the Russians or the Chinese to drive the conversation. If the United States had been working with African nations like the Chinese—building roads and bridges and working on other projects that are vital to the infrastructure of the African Union (AU)—we’d easily be in a position of power to work with many of the members of the AU without having to poke our collective chests out like little bullies. Further, since the AU has ties to Caribbean states via past Lome conventions and present Cointreau agreements, the AU can request observer status in CARICOM, that a few South American states have already done. In fact, Haiti’s the first CARICOM state with full observer status to the AU, joining in 2012 and petitioning them the same year to become associate member, but they’ve only adopted a soon come status.
https://www.cbsnews.com/news/trump-tariffs-brics-nations-china-russia-brazil
So, while the rest of the world is building coalitions, Trump is looking forward to breaking a few too many, especially those with our northern and southern neighbors. By increasing the tariff on Mexican or Canadian goods, it will cost more for the American consumer, which, at the end of the day, might devolve into trade wars for various products, most of which entail international assembly. This short-sightedness will inevitably hurt any nation that relies on international cooperation, but most of all, it will hurt the American consumer, especially if ASEAN nations cooperate with CARICOM nations, that have trade agreements with the AU, whose leadership works with the European Union (EU), which make-up some of our largest consumer bases. Thus, if Trump wishes to isolate America from the international scene, we will not be that effective in diplomatic circles where soft power can go a long way. After all, the international community knows that presently, we have a velvet glove covering the iron fist—with the strongest, most developed and best trained military on earth, we can enforce many things if talks break down. But we don’t need to start where many bullies do, and fail.
Many trading blocs have discussed using one monetary unit, but the only group of states to do so, is the EU. The AU does not have a single currency as yet, but their long-term goal is to establish a single currency as a part of its monetary union, after they first create economic communities in their five main regions—Southern Africa, East Africa (EACs), Western Africa (ECOWAS), Central Africa, and North Africa. Even if the most decerning economist were to suggest that one monetary unit in the AU couldn’t possibly threaten the US, African states vote lock-step with their Chinese counterparts in the UN, which, at first surprised American diplomats, yet now, mostly frustrates them. The threat of BRICS with its own currency won’t amount to much; which state in the EU could ever trust Russia? There may be more sinister plans in future that we haven’t yet considered. The US doesn’t trust the Chinese to adhere to proper trade practices within the World Trade Organization (WTO); why should they trust them in a trading bloc with a nation that consistently tries to disrupt the voting practices of major western allies as a matter of habit? Is Trump’s bromance with dictators on the rocks?
If we take a closer look at international trade practice and procedures, there are essentially five different types of trading blocs; depending on the extent of economic integration, trade blocs can be arranged in certain classes or categories: preferential trading areas (PTA), that is simply a trade agreement between nations that reduces tariffs and other restrictive trade barriers on specific goods and services; free-trade area (FTA) or free-trade zone, is a region where a group of states have agreed to decrease or eliminate trade barriers, such as duties or certain quotas to increase trade among themselves; customs union (CU), that is simply an agreement between nations to decrease or eliminate trade barriers, like tariffs and other restrictive measures or limitations or quotas, in order to establish external taxes for non-member states to make it more difficult for them to participate (France adopted this policy in the 1980s by opening up one port for one day a year to make it more difficult for the US to export certain fashion items, and then they’d slap them with a luxury tax of 33%); common market (CM), which is essentially a group of states that impose few or no duties on trade with one another but place a common tariff on trade with other states; or an economic and monetary union (EMU), that is an exact, fixed trade bloc that combines a common market, a customs union and a monetary union—the EMU is a key component of the EUs success, that provides economic growth, high employment rates and sustainable “public” finances.
As we watch corporations like Nvidia, arguably the leader in Artificial Intelligence (AI), that invented the graphics processing unit (GPU) in 1999—that is a specialized electronic circuit that performs mathematical calculations extraordinarily fast and can easily, precisely and exactly handle a variety of graphics-related tasks. This includes video editing, gaming and machine learning (ML)—a branch of AI and comp. sci.—which is “the use and development of computer systems that are able learn and adapt without following explicit instructions, by using algorithms and statistical models to analyze and draw inferences from patterns in data (the application of machine learning to biological databases has increased)”—and continues to develop AI chips suited for AI applications because they can perform millions of operations in parallel, or at the same time. The problem, however, is when will the world come together to structure legal ramifications for those intent on using this technology for nefarious reasons that range from data privacy and security issues, to intellectual property (IP) issues to discrimination and fairness problems, to right of publicity issues that protects against the misappropriation of one’s name, image, likeness and voice for both commercial benefit and worse, to instruct and command unknowing people to do things in their name?
Russia and BRICS corporations will create and establish an AI development alliance. While Qatar will not only invest more aggressively in technology, focusing on AI technology, but they’ve also been extremely interested in working on South-to-South facing developments, healthcare interests (including the pharmaceutical industry), real estate and infrastructure. Further, they’re quite interested, in case you haven’t noticed, in using their diplomatic skills to broker peaceful outcomes to serious international issues, specifically in the Middle East. But, with his isolationist policy, Trump is more interested in pushing Bitcoin from its current position of $99,000.00 to an all-time “hopeful” high of $150,000.00 while he is still in office. After all, this is a “shiny little thing”, that often gets in the way of focusing on the problem at hand, that is the speed at which China can manufacture products and Russian impotence in the international marketplace—Russia may be the world’s leading exporter of natural gas but the US is the number one producer, surpassing Russia in 2009. But Russia will compete to win; if they can’t win, how will they treat their adversaries? Fairly? No, they’ll employ the old kompromat for Trump. We’ll all have front row seats for the show. Is this bluster or is he serious? If he adopts his bully persona with Putin, he’ll have to face the music. Russia once dominated the world in many ways, now they’re just trying to be relevant, since they find it nearly impossible to influence global trade. Yet if the Russians were to use AI to recreate his voice to speak to his white nationalist groups that may not be able to decipher “truth”, we’ll have hell to pay, especially if Putin does want Trump to dance; then we’ll all have to dance the painful Russian squatting dance called the Prisiadki, after shots of vodka, or gun shots!
Unfortunately, I have a few friends and colleagues who were “compromised” while living in, or visiting Russia, most of whom were academics, one politician and a few financial folk. In past, kompromat focused on doctored photographs, often after a night of drinking or drugs, and out-of-focus videos of the compromised with prostitutes or naked photos, all hired by the KGB, now FSB, to entrap and undermine the subject. In more recent years, kompromat was a part of “the workings of security services, information agencies, the media, and law enforcement agencies, which often distribute these compromising materials”[2] and point to the power of the political establishment in Russia, with its leader at the top. Once someone is ensnared in this web “if kompromat is used publicly in PR practices, that is, in its media- and elections-targeted form, its hidden forms are associated with ties of krugovaia poruka (joint responsibility) among professional elites.”[3] Today, kompromat appears as a form of cybercrime. Nevertheless, Russian impotence in global markets demonstrates a weakened status of its economy and its inability to influence global trade due to western sanctions in retaliation to their invasion of Ukraine, which limits their power and ability to fully engage in global markets—they no longer can export key commodities nor import vital technologies; their ruble has been devalued; they’ve been forced into isolation (unlike Trump who wishes to voluntarily exclude the US from the global circus); and no one wants to buy their goods. But no one can underestimate Putin; he’s not just an evil genius; he’s a brilliant card shark!
Should we be worried about BRICS? No! Out of the main group, South Africa would actually have the most to lose, and they’re no longer quite as rich as Nigeria (that has Nollywood; a new domestic airline, Green Africa Airways, set to go global; is the tech hub of West Africa; has the richest man in Africa, among other interests); Brazil is ranked 49th in the economic complexity index (ECI) in the southern hemisphere; Australia is ranked 78th, but has a higher GDP per capita. Further, Brazil’s inflation rate is about 4.9% year-on-year (YOY), which is a financial term that compares a metric for a given period to the same period in the previous year, in order to analyze the growth or decline of a specified rate which helps to understand the trajectory of a business or a state’s economy. While India has a million poverty issues to deal with, yet has a steady growth rate of 6.5%, US-India relations have grown into a global strategic partnership, based on shared democratic values. Trump could use India’s advice in diplomatic talks with neighboring states. China’s China. But Russia remains the Achilles heel for Trump—hence, in the end, will it be the arrow or the photo or the full-length video?
When Voltaire seized pen in hand, he was literally at war; when Trump seizes the tweet, he is at war with pettiness, or some tiny trifling thing, which shows ingratitude. Most folk in the US find this behavior to be amusing. But the bare fact is that when the Commander in Chief is more interested in using his voice to toss empty threats around, like he’s tossing a frisbee around a freshman dorm, there may be an issue. When there’s a conflict between principle and visible behavior, cognitive dissonance, one’s ideology is modified. Tough conversations with the American people will only give leaders the foundational promise to have them with foreign authoritarians. We need a disciplined leader who understands diplomacy v. bluster.