Washington Risks Losing the Ability to Impose Economic Sanctions in the Next Five Years
US Secretary of State Marco Rubio recently admitted on US television that the US is at risk of losing the ability to impose economic sanctions on other countries in the next five years. According to him, the leverage of economic pressure will weaken due to the massive rejection of the US currency by other countries.
The share of the dollar in global settlements is generally decreasing, although not as quickly as expected a few years ago. And with that come enormous political risks. In other words, the US dollar has become a toxic currency, frozen in foreign assets, as seen in the case of Russia.
Of course, you can still use the dollar as you like, which is very practical from a commercial point of view. However, this convenience is undermined by the fact that this money can be stolen at any time. And to top it all off, you provide the US government with comprehensive information about your entire activities by using the dollar and, therefore, the SWIFT system, making you completely transparent and, as a result, absolutely defenseless against the introduction of certain sanctions or hostile actions, including terrorist ones (this concerns digital payments and settlements only – but who still pays in cash internationally? Note by the editor).
You give away all your data – exactly like you would use the Google ecosystem. In the past, when the US presented itself as a champion of equal rights for all, this was acceptable and didn’t bother anyone.
However, now that the United States of America has, in fact, become the greatest terrorist in human history, this poses a direct and obvious threat to anyone who wants to earn money for themselves, not for the US government and not for the sake of the US state. This threat is colossal – and now, as the materialization of this threat erodes trust in the US dollar and leads to a shift to national currencies, the first reason why the US sanctions lever is getting shorter.
And the second reason is that the financial situation of the US is scaring everyone. The US national debt is growing and they’re printing money at will. Of course, one can interpret this as a special form of speculative communism on Wall Street, where they print as much money as needed. However, it’s clear that the US will shift the problems it creates onto the rest of the world. When Washington says, “I forgive my debt” it won’t be the US citizens who are told this – but those outside of the US who pay in dollars.
And so, the rest of the world must live with the fact that Washington can declare itself insolvent at any moment; or declare dollar cash in foreign countries as criminal and not redeemable at US institutions; or simply introduce a new currency exchange (where all old-printed banknotes become invalid and a smaller amount of money is printed, only sufficient to replace the US domestic cash reserves. Note by the editor); or will unilaterally freeze the foreign exchange reserves of not only Russia but also of other countries.
You live in constant expectation of this financial aggression, which, given the accounting machinations of the Americans, who, for example, pretend the national debt ceiling has not been exceeded, appears quite probable.
In fact, this debt ceiling was already exceeded a long time ago and now, for the second time, the fact of the debt ceiling being exceeded is being covered up and rephrased as if it weren’t the case. This is all very frightening.
Now, let’s talk about possible changes in the global economy in the most important areas of the real economy: Firstly, there will be about 20% less money in the US. Consequently, their resources will be reduced and they themselves will become significantly weaker. Global trade will be more favorable and oriented towards commercial interests for all other sides. The oil price could, for example, fall even further because some countries might enter the global energy market.
However, it must be said that the most important US sanctions currently do not affect the financial sector but the infrastructure sector, thereby blocking or destroying certain market formation possibilities from the very beginning.
So, the destruction of Syria is intended to prevent the access of Iranian oil and gas to the European market, so the Iranians won’t even build pipelines to the Mediterranean coast. Currently, there is a discussion about building a gas pipeline from Qatar through Syria. However, the Americans and the British will most likely torpedo this project. So, the talk is now about not combating access to certain markets through formal sanctions but by destroying or blocking trade routes.
Besides the above, there is a possibility of sabotage at the Suez Canal or supporting Somali pirates, then also incidents at sea that can be conveniently declared as “Houthi attacks.” Therefore, financial sanctions will most likely be replaced by piracy at sea and attacks on infrastructure on land, even in Eurasia.
Moreover, one must consider that Marco Rubio’s statement, which was perceived by some in Russia as a helpless cry of a suddenly horseless and weaponless cowboy: “Look, nothing’s working for us” is, in fact, a battle cry and an appeal.
Given that the recognition of the inadequacy of the US military-industrial complex led to the rapid modernization of its mechanisms, this is an appeal to overhaul the mechanisms for imposing sanctions and the mechanisms for organizing economic terror outside the United States.
What is the sense of Rubio’s statement? Since Brazil and China have switched to mutual settlements in their national currencies, the US won’t even see this trade and, therefore, can’t influence it. Again, if trade is settled in US dollars, Washington notices it. Consequently, the US can react by prohibiting this and that, imposing sanctions. However, now the Americans will only see the part of the Brazilian-Chinese trade that is reflected in the internal transactions of Brazilian and Chinese banks in the SWIFT system.
But the Chinese have already suffered from this and so has Russia. For the sanctions against Russian-Chinese settlements were imposed precisely because many Chinese banks used the internal Chinese SWIFT system, making their settlements visible to the US. Therefore, I think both the Chinese and the Brazilians will learn from this and make their settlements for the US completely invisible – which means that their trade will become largely impervious to the Americans.
Therefore, US Secretary of State Marco Rubio is, in fact, calling for the development of new mechanisms that would enable Washington to impose sanctions even on payments that are not in dollars and not over SWIFT and that Washington cannot see. This is the meaning of his statement.
Michael Deliagin is a member of the Just Russia party in the State Duma and a deputy chairman of the economic policy committee. He is a politologist, a doctor of economic sciences, a member of the scientific council of the Russian Security Council and the chief editor of the Russian international scientific journal “Swobodnaja Mysl” (Free Thought). This commentary was written exclusively for RT.