What Happened Today: March 8, 2022
What Happened Today: March 8, 2022
U.S. bans Russian oil; Zelensky signals compromise; Kirchick on D.C.’s ‘common interest’ with Russia
The Big Story
The United States has banned all imports of Russian oil, coal, and natural gas, President Biden announced Tuesday morning. The move is part of a raft of economic sanctions designed to punish the Russian government for its invasion of Ukraine, and was matched by a British ban on Russian oil. But the European Union, which is a far larger purchaser of Russian energy exports, has not agreed to an immediate halt on buying Russian gas, though it says it will reduce its purchase from Moscow by two-thirds by the end of the year. Although President Biden touted the new policy as a “blow to Putin’s war machine,” it’s not clear how much immediate impact the U.S. and UK bans will have on the war in Ukraine since they are relatively small purchasers compared to Europe, which accounts for some 60% of Russian energy exports. European countries are also paying a new premium to Moscow in the form of the dramatic increase in the price of gas since the war started, after Russia jacked up prices to make up for losses in other markets. In the United States, the national average price of gas broke a new record, at $4.17 per gallon on Tuesday, surpassing the previous high from 2008 of $4.11. With prices expected to rise even higher after news of the Russia ban, the Biden administration is framing its policy as not just a necessary sacrifice to slow down Putin’s war machine but a positive step toward achieving its domestic “green energy” agenda. Gas prices in the United States had been rising for more than a year before the war in Ukraine started. But rather than attempting to bring them down by increasing drilling and gas production in the United States—moves that would anger the Democrat’s environmental lobbies—the White House is trying to use the high prices to spur “green” industries. “Transforming our economy to run on electric vehicles powered by clean energy” will help bring down gas prices in the United States, Biden told reporters Tuesday.
Read it here: https://www.nytimes.com/live/2022/03/08/world/ukraine-russia-war#biden-bans-russian-oil
In The Back Pages: Why the White House Sees a Common Interest with Russia on Iran
The Rest
→ The third round of official talks between Ukraine and Russia ended Monday without a breakthrough. However, there were signs of a possible off-ramp from the war when Ukrainian President Volodymyr Zelensky told ABC News that compromise with Russia was possible. Zelensky rejected the possibility of unconditional capitulation to Russia’s full terms but said that he’d consider meeting one of Moscow’s core demands: for Kyiv to formally accept Russian sovereignty over Crimea and the contested Donbas region of Eastern Ukraine. Zelensky also lashed out at the West for not implementing a no-fly zone in Ukraine—an act that would be tantamount to officially entering the war—and said Western leaders were responsible for the deaths of Ukrainians. His anger could also be an indicator of potential political resolutions to the conflict.
→ Ahead of the announced ban on Russian oil imports, U.S. officials traveled to Caracas to discuss Venezuelan oil reserves, which are the largest in the world. Venezuela’s oil has been sanctioned since 2019, when President Trump implemented a “maximum pressure” policy in support of hundreds of thousands of Venezuelan protestors calling for elections and decrying President Nicolas Maduro’s ruinous and repressive policies. In exchange for the oil, the Biden administration would grant Venezuela temporary relief from sanctions. But with prices now soaring and Russia cut off, the Biden administration is in talks about increasing the energy supply with not only Venezuela but also Saudi Arabia and the United Arab Emirates; there have been no known discussions about expanding the United States’ domestic shale production.
→ The bombardment of Ukrainian population centers continues 12 days into the war, while Russian conventional forces maneuver on three main fronts: one coming from the East, one from the South, and one around the Ukrainian capital, Kyiv. Russian forces, while still vastly outnumbering the Ukrainian military, appear to have taken significant casualties and damages.
→ Ukrainian officials have accused Russia of deliberately targeting civilians attempting to flee the war through so-called “humanitarian corridors.” More than 2 million refugees have reportedly already left Ukraine, and hundreds of thousands more are attempting to exit the country, some of them using the corridors—though with Ukraine and Russia each designating their own “safe zones” for civilians to travel through, it’s not always clear which ones are recognized by which country. A designated Ukrainian corridor in the southern city of Mariupol came under Russian shelling, according to Ukrainian officials. “The enemy has launched an attack heading exactly at the humanitarian corridor,” a Ukrainian defense ministry official wrote on Facebook, alleging that the Russian army “did not let children, women, and elderly people leave the city.”
→ Wheat prices are shooting up along with the cost of gas, an ominous sign of what could turn into global food shortages if the conflict with Russia expands, which could be devastating in countries without abundant reserves. The price of wheat, which hit a 14-year high last Friday, continued rising Monday for the sixth consecutive day. Together, Russia and Ukraine make up roughly 29% of global wheat exports.
→ President Biden is expected to sign an executive order on cryptocurrency this week that would regulate how the digital currencies are traded and direct federal agencies to look into the potential for creating a U.S. central bank-backed cryptocurrency. U.S. officials have complained that unregulated crypto markets are allowing rogue actors to break the law and Russia to evade sanctions. But earlier this week, Coinbase, which has one of the largest crypto trading platforms in the world, elected to block 25,000 cryptocurrency addresses linked to Russian people or entities. The backlash in the libertarian-leaning crypto world gives an indication of why more crypto companies have not followed suit with their own bans—but the new executive order offers insight into why Coinbase, sensing the government tightening its grip on the crypto market, implemented the policy.
→ Employers use a range of wage-setting tactics to drive down workers’ salaries and constrain the labor market, according to a new report from the Treasury Department. “The American labor market falls far from the perfect competition that economists had long assumed due to employer concentration and anti-competitive labor practices,” the report states. Employer concentration refers to mergers and monopolies; these then lead to limited employment options and less bargaining power for workers. Anti-competitive practices include a number of common restrictions placed upon workers, such as noncompete agreements that prohibit an employee from working for a competitor. These practices, the report estimates, lead to a 20% decrease in wages relative to what workers would earn in a fully competitive market. The report outlines a series of steps the Federal Trade Commission should take, including passing laws to prohibit noncompete agreements. Should this happen—and it likely will—tens of millions of employees will be untethered from the wage-suppressing clauses in their contracts.
→ COVID-19 can lead to brain atrophy and memory loss, according to a new Oxford University study published in Nature. The study looked at 785 older adults (aged 51-81), half of whom had COVID-19. Those who had tested positive for the virus (401 members of the study) “showed on average a larger cognitive decline” than those who did not. COVID-19’s impact was especially deleterious in areas of the brain involved with smell and memory function. The COVID-19-positive cohort also performed significantly worse on exercises assessing executive function and attention span.
Scroll Correspondent James Kirchick on Why the White House Sees a ‘Common Interest’ with Russia on Iran
The Biden administration has not held back in its condemnations of Russia over its war of aggression against Ukraine. “Vladimir Putin,” President Biden declared last week in his State of the Union address, has “sought to shake the foundations of the free world thinking he could make it bend to his menacing ways.” According to Secretary of State Antony Blinken, “The human costs of the Kremlin’s unwarranted, unprovoked, and unjustified war on Ukraine are staggering.” To match this rhetoric, the administration has levied sweeping sanctions against Russian financial institutions, oligarchs, and defense enterprises.
Meanwhile, several hundred miles from the field of battle, in Vienna, the Biden administration is relying upon the very same Russian regime it rightly condemns for overturning the fragile European security order as its mediator in negotiations to prop up an even more tenuous Middle Eastern security order. For weeks, diplomats from the United States, Britain, France, Germany, China, and Russia have been in talks to revive the scuttled nuclear deal with Iran. The Joint Comprehensive Plan of Action (JCPOA) was architected by the Obama administration and signed in 2015 after several years of secret negotiations followed by formal talks between the White House and Tehran. The Iran deal, as it’s commonly known, lifted most international sanctions on Iran in exchange for temporary restrictions on the country’s nuclear program.
Lacking the support necessary for an official treaty, Obama bypassed the Congress and Senate and pushed the deal through as an executive action, which then made it possible for Donald Trump to unilaterally withdraw from the agreement in May 2018, shortly after taking office. In the intervening period since Trump pulled out of the deal, Tehran has expanded its nuclear activity.
Negotiators in Vienna were reportedly close to an agreement on a new deal until this past weekend, when Moscow issued a demand that it be given written guarantees that the new Ukraine-related sanctions will not impede its healthy trade with Tehran. “We have asked for a written guarantee … that the current process triggered by the United States does not in any way damage our right to free and full trade, economic and investment cooperation, and military-technical cooperation with the Islamic State,” Russian Foreign Minister Sergei Lavrov said. What’s Russian for chutzpah?
Even for those few remaining naifs who, like Blinken’s predecessor, John Kerry, still thought Lavrov to be a man of integrity, Russia’s “unwarranted, unprovoked, and unjustified” war has exposed him to be an utterly shameless liar. The man spent months telling his Western interlocutors that his country had no intention of invading Ukraine when all the while it was preparing to do just that. And yet Lavrov’s latest diplomatic feint appears to have taken the Biden administration by surprise. “The new Russia-related sanctions are unrelated to the JCPOA and should not have any impact on its potential implementation,” a State Department spokesman said, as if the United States were dealing with a good-faith actor and not a man who lies for a living. “We continue to engage with Russia on a return to full implementation of the JCPOA. Russia shares a common interest in ensuring Iran never acquires a nuclear weapon.”
The Biden administration may like to believe that Russia “shares a common interest” with the West in preventing Iran from obtaining a nuclear weapon, but such protestations fly in the face of Moscow’s behavior. On Feb. 28, just a few days after Russia launched its invasion of Ukraine, a Russian-flagged ship targeted by U.S. sanctions was identified carrying sanctioned Iranian oil to a port in Malaysia. This was not the first time the Russians have been caught sanctions-busting, and there is no reason to believe that the Putin regime would do anything to enforce a new nuclear deal once it’s signed.
Russia’s brazen act of aggression against a peaceful, democratic country has done more to convince Europeans of the need to build up their own defenses and wean themselves off of Russian energy than decades of American hectoring. In Germany, the country traditionally most resistant to these long-overdue policy changes, the rapid transformation has been termed a Zeitenwende, or turning point. In the Middle East, the rise of a similarly belligerent and revisionist power has prompted its own geopolitical transformations, with a slew of Arab countries lining up to make peace with their historic adversary in Jerusalem. The only country that appears blind to these shifting realities is, oddly, the United States.
This administration thinks that it has some sort of divine right to fool all of the people all of the time, engage in ruinous domestic and economic policies and appease its enemies which are all designed to please the woke base of the Democratic Party