Mentioning the war on COVID but not the actual war between Russia and Ukraine that caused a huge spike in European energy prices is a big omission, since that caused a lot of global inflation.
Extreme hike in energy prices was about four months before the war began. It’s when EU decided to abandon long term gas contracts and turned to spot prices (~11.2021). The war started in 02.2022.
From your perspective the war started in 2022.
In reality that phase of the war started before. Russia did not improvise this war. They started disrupting the supply in 2021 to ensure that Europe would not fill their strategic reserves / winter storage during the summer, thus insuring maximum leverage when they needed it. This is well documented [1]
Note that this is just talking about this phase of the war. Hostilities started in 2014 when parts of Ukraine "suddenly self-liberated" themselves. Helped by mysterious soldiers in professional but unmarked uniforms.
[1] https://www.banque-france.fr/en/publications-and-statistics/...
Nobody has sabotaged European energy security more than European governments. The divestment from nuclear and reliance on LNG was an obvious disaster in the making. Taiwan has made a similar blunder and will pay the price at the next whiff of geopolitical instability.
You've just read how Russia literally sabotaged European energy security and you compared this to... some European countries taking a suboptimal decision?
And Europe is not a single country. My country still happily digs out and burns tons of coal (annoying our neighbors in the process). I hope you're proud of us.
It's not suboptimal, it's a geopolitical disaster that people in 50 years will look back on and ask "how did this happen?"
Well, the full scale portion of the war started in February 2022.
But you are right otherwise.
Yes. I was surprised to find out that Russia had been conducted sabotage operations against UA artillery ammunitions dumps for many years prior to full scale invasion, and the Ukrainians had already lost the majority of their artillery ammunition reserves this way by the time invasion began.
And they conquered Crimea in 2014--partially, if I remember right, to get a port that doesn't freeze over in the winter, something they have wanted for literally hundreds of years.
They already had https://en.wikipedia.org/wiki/Port_of_Novorossiysk for that.
Yes, but Sevastopol is a better port, and any naval position in the Black Sea is less secure, when you don't control Crimea yourself.
(Russia got into more trouble than it was worth it, even by their own standards, I'd say. And that's not even getting into the moral dimensions.)
To be more precise, they already had the port, but were afraid to lose it to the new government of Ukraine.
This is also a big reason why Crimea, by and large, supported annexation - it has very large proportions of the population that are either active or retired Soviet/Russian navy.
The Russia Empire and the Soviet Union ran concerted efforts to Russianise the population of Crimea by various means, like moving in ethnic Russians, removing the locals (to put it mildly) etc.
removing the locals (to put it mildly) etc.
Virtually the entire indigenous and otherwise non-Slavic population (some 30 percent of the total population of the peninsula) to be precise, according to this graph:
https://upload.wikimedia.org/wikipedia/commons/6/6a/Ethnic_P...
The original Russian colonization of Crimea brought in many Ukrainians as well, though, so that alone did not make it lean Russian so strongly by itself. The naval facilities in Sevastopol, though, meant a lot of military personnel with their families from all over the country would come and settle in the city, and that specifically tilts the popular opinion there today strongly towards imperial Russian irredentism.
The embargo caused the spike. Which makes having thrown away a workable peace deal a criminal act.
There was no "workable peace deal".
As unrealistic as it may be, “Russia gives back the stolen land and pays reparations” sounds like a workable deal if Russia itself suffers for long enough. Or maybe Russia will leave Ukraine if we give them all the land and assets owned by the “Ukraine should make a deal with Russia” people, as they're of the opinion that placating an invading army is the best way to peace.
> if Russia itself suffers for long enough.
Do you want Russia, a geopolitical entity, to somehow measurably suffer, or do you want an end to pointless bloodshed? Are you willing to put your own life to this lofty goal?
> placating an invading army is the best way to peace.
If you're not capable of repelling the invasion effectively, then yes, this is absolutely true. How could it not be? There's no reason that you can't have peace today and sue for justice tomorrow.
Did US appeasement of Russia after the annexation of Crimea bring any kind of lasting peace?
Why anyone would think this time it would be different when what Russia wants hasn't changed is beyond me.
What makes you so confident in the absence of something? In particular given that there is a massive amount of reporting that conflicts with your single sentence assertion?
I'm Russian, and I've been following the mess in Ukraine very closely since 2014.
The key word in my single sentence is "workable". All Russian peace deals so far essentially amount to 1) they get all the territory they claim, and 2) they pinky promise to not invade Ukraine again, but 3) Ukraine is forbidden from taking actions - such as joining NATO - that would actually guarantee that such an invasion wouldn't re-occur.
Knowing Russian politics and discourse inside the country around imperial ambitions in general and Ukraine in particular, I'm firmly convinced that any peace deal that would be signed on these terms will last only as long as it'll take for Russia to build up enough to resume hostilities with a much stronger upper hand. Most Ukrainians seem to be of the same opinion.
Appreciate the clarification.
That said, I'd be curious to know why you seem to implicitly accept the Russian regime's currently stated (or reasonably inferable) terms as the only "workable" terms.
Is it because you think it has that much of an upper hand in the situation (to get its way no matter what the West does in the coming months) -- or because the Trump administration will likely simply cave in to pretty much whatever it asks for?
Given the latter's proudly and loudly stated "We don't give a fuck about Ukraine" stance, and all.
GP was talking about "having thrown away a workable peace deal", which in this context almost always refers to the purported peace deal that fell apart in 2022. In any case, the only other peace deal that is currently officially on the table as far as Russia is concerned is basically the same.
What's actually workable in the end depends solely on how far the West is willing to go, IMO. There's no realistic scenario in which Ukraine retakes all the captured territories without direct Western military involvement - air at the minimum - which is certainly not politically tenable in either US or Europe (although my personal opinion is that both will eventually regret not getting directly involved now, because they will be forced into a larger war later anyway).
Russia will definitely not give up Crimea without getting military defeated there; quite aside from any military value of Sevastopol, the symbolical and political value is just too high, especially for a regime that desperately needs to be seen as "patriotic" by the populace - that is their only real source of legitimacy in the absence of real democracy. Abandoning LNR and DNR would be easier in some ways, but harder in others because the government agitprop has already spent so much time vividly describing how "Ukrainian Nazis" are supposedly ethnically cleansing Russian speakers to justify the invasion, abandoning them now would also be very costly in terms of popular support.
OTOH I could see the pre-2022 de facto borders as something Putin would accept. They could still justify the war then by claiming that, at least, LNR and DNR were "rescued" and are now safe from further depredations, and that people from other regions that couldn't be "liberated" will be resettled, so - mission complete, oooorah etc.
However, I don't see why they would do that if the West keeps dragging its legs on military support to such an extent that Ukrainians can't even reliably hold what they already have. The way things are going, Russia can keep doing what it's doing, even despite the insane cost in human lives, for longer than Ukrainian military can hold the line. Ukrainians have less of basically everything - artillery, drones, people. They make do by making much more efficient use of what they have than Russians do, but it's still too skewed to be sustainable.
And meanwhile the West hasn't even drawn any clear red lines on how much of Ukraine Russia would need to take before the support would be seriously ramped up - if at all. So then, when Russia sees that support is already at levels insufficient to sustain Ukraine, and it's likely to dwindle significantly with Trump, and it has the upper hand in terms of momentum right now... I don't see why they'd suddenly want a deal.
OTOH if US and Europe doesn't get involved directly but start treat their role as the "arsenal of democracy" in this conflict seriously, it might just be enough for Ukraine to hold the line in the east and in Kursk. And then they might be able to trade that captured Russian land for a peace deal with some concessions - maybe not quite pre-war borders, but at least push the new border away from large cities like Kharkiv and Kherson. However, any such deal would be pointless for Ukraine unless they get proper security guarantees; and, given the whole history with Budapest Memorandum, the only guarantee that Ukraine will actually believe in at this point is NATO membership. AFAIK that is the main reason why popular support there is still in favor of continuing the war and rejecting the current Russian offer - they elected Zelensky largely as a peace offering to Russia and effectively acknowledged the de facto existence of LNR and DNR, and all they got for that is an even larger invasion, so it's a "fool me twice" kind of deal now.
Appreciate the detailed response, and it seems we are very broadly on the same page.
Assuming no further military push from the West -- do you think the Russian side would acquiesce to some form of "Cease fire along current lines, but no legal recognition of the territorial claims, and no lifting of sanctions or arrest warrants, and no return of seized foreign assets"?
(That's very far from my own ideal outcome, but I'm just trying to get sense of how you see the situation).
It's hard to say. It would be essentially the same thing they already did back in 2015, so there's precedent. But back then it happened IMO because they didn't think they were sufficiently prepared in economic and military terms to openly wage war, so Russia took as much as it could with the "northern wind" (the euphemism separatist forces used to refer to direct Russian involvement in combat) and then took a break to prepare for the real deal.
So I think now they would do it if they believe that taking another break would benefit them more than it benefits Ukraine. But, again, looking at post-2015 developments, it's not clear to me why they'd think that. The reason why their advance in the east was so much slower than elsewhere is that Ukraine had a massive effort to build fortifications and infrastructure around them under Poroshenko. It's why Ukraine could hold Avdiivka for so long despite it being less than 10 miles away from Donetsk, and it's partly why Russian losses are so high. Russia has managed to punch through that line in several places in this past year despite those high costs, but if they stop the advance now, that kinda defeats the purpose of that. And meanwhile if Ukraine could get some respite, they would surely spend a lot more resources on another defensive line along the new border, probably with significant Western assistance this time, as well (since "defensive" military aid generally enjoys higher popular support, countries like Germany might be more willing to do that even if they aren't willing to send more tanks and missiles). As well as building new munition factories etc, likely also with Western defense companies involved. It would also mean the return of millions of Ukrainian refugees, reinvigorating their economy.
This all assumes that Russia wants to take as much Ukrainian territory as they can get away with, in the long term. But, given that the war literally started with them trying to capture Kyiv, I think it is a safe assumption. If they gave up on that goal since then, they wouldn't be pushing so hard now despite the losses.
Especially since the Finnish experience is the only direct comparison to Ukraine today, where both their army and government are fighting Russia.
False. Inflation was mainly caused by the central banks(especially the US FED but also the ECB who followed suit) devalued the currency by over-issuing it during the pandemic, not due to the post pandemic high energy prices which are not that high when you adjust for the crazy Inflation the excessive money printing generated.
In short, they barrowed money in your name with you as a guarantor and now you're paying for it, it's that simple.
The war caused by Russia is just a convenient scapegoat that's easier to sell to the financially illiterate population to deflect the blame. Keep in mind most voters don't understand basic economics and how currency supply affects inflation, but they do understand "Russia dropping bombs = bad".
When 80% of the entire world supply of USD (the world reserve currency that the EU also has to use) was printed during the pandemic, how can anyone say that Russia's war caused the inflation? Do people not know arithmetic anymore?
Money supply increased significantly in 2020 for sure but that's NOT what you're seeing in the M1 graph. M1 was revised to include savings accounts at the same time and this is the major source of the discontinuity:
https://fredblog.stlouisfed.org/2021/05/savings-are-now-more...
M2 captures the pandemic influx better and is significantly less dramatic: https://fred.stlouisfed.org/series/WM2NS
Do you think that since M1 is down 13% since peak we should be seeing deflation right now, or does M1 growth only impact inflation one way?
It would be stupid to discount the effect that artificially limiting energy exports and using it for blackmail before and during the full-blown Russian invasion is naive. IIRC my nat gas prices went up like 10x compared to the previous year.
Utter nonsense, and I say this as nicely as I can.
Check the price of Russian gas before and after the invasion, and the resulting price of electricity: https://ec.europa.eu/eurostat/statistics-explained/index.php...
Combine with the fact that Russia and Ukraine are some of the biggest exporters of many critical raw materials, like importantly, foodstuffs (wheat, sunflower oil, etc), and steel, aluminium, oil, gas. Hell, there was a crisis in availability of mustard and snails in France due to the invasion of Ukraine (and on the mustard, a series of bad harvests in Canada which further complicated things).
We can even clearly see it in the inflation charts, first there was growth in energy inflation towards the end of 2021 (as things were ramping back up from Covid), then a big spike in 2022 due to Russia's invasion, and then over 2022-2023, related spike in other sectors: https://ec.europa.eu/eurostat/statistics-explained/index.php...
To pretend none of this had no impact whatsoever is wilful ignorance.
Bruh, 80% of all USD in existence was issued during the pandemic alone. How the hell can you tell me with a straight face that that didn't cause the inflation? I feel like I'm taking crazy pills.
Read the notes in the link you posted. I don’t think it says what you think it says.
In May 2020, the definition of M1 (monetary supply in “cash”) was changed to include savings deposits. They changed this not due to some conspiracy, but because savings accounts were deregulated to remove withdrawal limits, effectively rendering them cash-equivalent, and thus necessary to include in M1 metrics.
I.e. the 80% spike has nothing to do with money being printed.
The relationship between the money supply and inflation is mostly one of perception causing action, not some kind of primal law of economics. Debt and interest rates, trade friction and availability of goods, and availability of energy and labor are all more closely related to inflation rates, especially for monetarily sovereign currencies.
Bad faith argument again, or at least terrible tunnel vision.
So what? In the EU a lot of that money went into the Recovery fund, which released the funds in multiple steps (only the first one was in 2021), and a lot of it is still remaining in the fund.
How do you explain the massive inflation in the EU then?
And are you seriously that centred on "money printing" that you cannot imagine gas and oil prices raising multiple times, and the disappearance of multiple critical raw material suppliers, had _no impact whatsoever_?
>Bad faith argument again
Stop saying this whenever somebody disagrees with you. That's not what that term means at all.
I'm not saying this because they're disagreeing with me. Inflation is probably one of the most talked about topics of the past few years, I find it impossible that people haven't heard about the multi-layered complexity of it, and thus anyone blaming it purely on "money printing" has to be acting in bad faith.
It's not really complex, GP is correct.
High energy prices cause high transportation and manufacturing costs which causes everything else to rise.
But the main cause of inflation is printing of money, especially when you introduce such a large amount in such a short time.
People used to know that, they either pretend it's not true now or they're ignorant.
And yes the "bad faith" parrot line is really annoying and doesn't contribute to the conversation. It's what people say when they don't have a rebuttal.
> It's what people say when they don't have a rebuttal
Only I have a rebuttal, and came with receipts from Eurostat. So what exactly are you trying to argue?
> But the main cause of inflation is printing of money, especially when you introduce such a large amount in such a short time.
The original premise (which is still in bad faith, however much you dislike that part) was that money printing was the main cause. And this is fundamentally and provably wrong (check my comment upthread, Eurostat inflation per sector with the timeline). Inflation was kickstarted by energy inflation which coincides with the Russian invasion.
Did money printing contribute? Of course. Did Russia's invasion of Ukraine and all the issues it brought in energy prices and food prices? Of course. Did the Houthis contribute with their attacks disturbing supply chains? Probably. Did Covid contribute with all the supply chain issues it caused? Of course.
Trying to pin it solely or mostly on one single reason, especially when it is a global phenomenon that many countries suffered from regardless of their exact specifics (e.g. Sweden's monetary policy was not the same as the EUs nor Canada's, yet they all suffered from serious inflation) is arguing in bad faith. It's so trivially provably wrong, it's not even funny entertaining people who are wrong.
This is due to people being taught that inflation is about the money supply as a matter of faith in (US at least) grade schools and colleges. It's rare for other causes to discussed or for the quantity-of-money argument to be questioned.
While I would also lean towards blaming the US Fed, how can you be so confident in precisely what caused inflation?
One of my big issues with economics as a "science" is that they try to boil down massively complex systems into a handful of numbers. When it comes to global economics and geopolitics the system is even more complex. How would we ever be able to say any particular time of inflation was causes by exclusively, or primarily, any one factor?
At best looking at historic data and seeing graphs that move together show correlation, they will never show causation.
The European Central Bank said it’s due to energy.
The people who caused the problem say they weren't responsible for the problem.
Do you see the issue here?
That goes both directions, though. Central banks are prone to understating their responsibility for bad things; the gold bugs and crypto hodl folks are prone to overstating it.
The answer likely lies somewhere in the middle. The US's relatively soft landing post-pandemic seems to demonstrate some use of monetary policy in this fashion works.
Of course they'd say that. Did you expect them to just say "yeah, we fucked you over by devaluing the currency causing your wages to be worthless"?. Don't be naive please and look into how much currency was issued during the pandemic and see for yourself.
