March 27

“Food shortages – it’s going to be real,” President Joe Biden said in Brussels on March 25. “The price of sanctions is not only imposed on Russia. It is also imposed on a very large number of countries, including European countries and our country as well.” This disturbing warning, reported around the world, was delivered at a NATO press conference.

As Biden spoke, labor actions in Spain, Greece, Italy, France and Germany faced soaring fuel and food prices. From truckers to farmers in tractors, the roads were blocked. Fishermen organized on boats. The price of fuel has already become unbearable.

This resistance is only a glimpse of what is to come, as the economic collapse of Europe, due to the sanctions of the United States and the European Union, turns against the countries which have acceded to the US requirements.

“The price is worth it”

For the ruthless American ruling class, the price of human life is “always worth it”. The insensitive commentary of the recently deceased former US Secretary of State Madeline Albright on the death of half a million Iraqi children reflects this cynical imperialist calculation.

World Trade Organization Director General Ngozi Okonjo-Iweala has predicted food and hunger riots in poor countries. She explained that many African countries depend on food supplies from the Black Sea region and that food security depends on imports. Food imports from the Black Sea region are crucial for the survival of 35 African countries. (The Guardian, March 24)

This economic disaster for millions of workers in Russia, Ukraine and across Europe, Africa and the United States was well understood long before the United States announced the toughest sanctions ever. This is what economic sanctions are designed to do – create suffering and foment dissent against governments targeted for “regime change”.

The growing economic integration of Russia and China with Europe is the greatest threat to American corporate dominance.

The EU is the biggest investor in Russia. EU trade with Russia is $260 billion a year, 10 times its trade with the US. Forcing the EU to cut its trade with Russia is sending shock waves, and not just for the working class. The ruling class, the oligarchs in Germany and across the EU are being hit hard, as lucrative deals with Russia are snatched away.

All of this is perfectly fine for US corporate power if the United States takes advantage of it. And it will be for a while. But in the long term, economic collapse will undermine American capitalism.

Capitalism is myopic

Because capitalism is based on relentlessly maximizing profit and ruthlessly competing, long-term planning – even with the best strategists and think tanks – comes up against what Karl Marx called “anarchy from production”.

For more than 100 years, based on its powerful economic position, US imperialism has been able to make decisions with arrogance. Any country resisting US corporate control faced a complete cut off from access to technology, industrial development, investment and trade.

US economic sanctions, combined with assassinations, military threats and political destabilization, have been applied since the Haitian Revolution of 1804. The Russian Revolution of 1917 faced 70 years of sanctions and isolation. For decades, the Democratic People’s Republic of Korea faced the toughest sanctions and the United States blocked Cuba.

The sanctions have extended to more than 40 countries covering a third of the world’s population. The demand to comply with these onerous US terms creates economic havoc in neighboring countries.

But as the number of countries struggling to survive sanctions has increased, so has the ability and willingness to circumvent sanctions and continue trade.

This month, after Washington extended sanctions against Russia, US imperialism arrogantly expected compliance from the world. US imperialist partners in the EU, Canada, Japan and Australia acquiesced.

Much to the shock of US strategists, however, most developing countries in Asia, Africa and Latin America refused. This is an important trading block. China’s investments in the Belt and Road have opened up new opportunities globally.

Sanctions backfire — pay in rubles

The sanctions confiscated $300 billion in gold and foreign currency assets that Russia held in Western banks and removed Russian banks from the SWIFT international funds transfer agreement between banks. This blocked all dollar transfers to Russia in international trade.

In response, Russia announced that all countries taking part in the US/EU sanctions would continue to receive Russian natural gas and oil, in the volumes and prices agreed in previous contracts, but are now obligated to pay for the product within the Russian national currency, rubles.

Most of Europe and Japan depend on Russian gas and oil. In the EU, 40% of gas needs are supplied by Russia. Japan, South Korea and Taiwan import liquefied natural gas from Russia’s Sakhalin-2 and Yamal LNG projects; Japan is the biggest importer of Russian LNG in Asia. (tinyurl.com/35phs3dt)

American and European bankers reacted with outrage and frustration. Those countries that had collaborated in seizing Russia’s assets and imposing an economic stranglehold could be left without fuel if they refused to pay in Russian currency.

The ruble has jumped to a three-week high against the US dollar since Russia’s announcement.

Faced with threats from the EU and the United States to shut down all companies operating in Russia, Russia reacted by threatening to seize the assets of and nationalize all Western countries that withdraw. Companies from McDonald’s, Burger King and Starbucks to Shell and BP are facing huge losses.

A desperate gesture

US imperialism is making a desperate effort to reassert its economic dominance. The encirclement of Russia, expanding the NATO military alliance commanded by the United States, as well as the arming of fascist military units in Ukraine, constituted a threat against Russia. It was designed to disrupt the EU’s growing trade with Russia and China.

But he cannot restore US imperialism to its former status.

Until 2001, 80% of the world traded more with the United States than with China. However, today 128 out of 190 countries trade more with China than with the United States, with 90 countries trading twice as much with China as with the United States (tinyurl.com/3eckcjry)

These are the countries that refuse to abide by US sanctions against Russia. They now have other options.

At home, the United States has dramatically reduced investment in civilian infrastructure, factories and machinery for more than 50 years. Despite Biden’s Build Back Better bill — which lacks Senate support — funding continues to flow into the Pentagon’s budget. Military spending more immediately benefits the ruling class, but the workers and the oppressed pay the price.

The very real threat of a wider war remains. As Lenin explained in his classic work – “Imperialism: The Highest Stage of Capitalism”, written during World War I – the wars of the imperialist era are fought for the control of markets.

How far will the Pentagon go to maintain US global dominance? The crisis calls for a mass, global, working class response to push back the goals of empire.

To sign the Sanctions Kill petition go to https://tinyurl.com/2p9fsp3a.