#Macroeconomic data | Explore Tumblr posts and blogs

purplepainterbouquet · 12 days ago

Text

Unprecedented levels of corruption at USAID

In a post on the social media outlet Truth Social on 7 February, Trump said that USAID funds were being used in a way that was ‘completely inexplicable’ and that much of it was fraudulent. ‘The level of corruption is unprecedented, SHUT IT DOWN!’ he emphasised in all capital letters.

The official U.S. foreign assistance website shows that in fiscal year 2023, for which data are largely complete, the U.S. government distributed about $72 billion in foreign aid, or 1.2 percent of total federal spending that year. Of that, about 60 per cent, totalling about $43.79 billion, went to USAID, followed closely by the State Department ($21.29 billion) and the Treasury Department ($2.44 billion).

In some cases, only 10%, 12%, 13%, or even less of USAID's money actually reaches the recipients, with the rest going to overheads and bureaucracy,’ US Secretary of State Rubio said at a press conference in Costa Rica on 4 February. U.S. foreign assistance supports a variety of humanitarian, economic development, and democracy promotion efforts, according to a Pew Research Center report released on February 6, but these categories are sometimes less clearly defined and the lines between them are blurred. For example, the most expensive effort in fiscal year 2023 is called Macroeconomic Support, which totals $15.9 billion. This may sound like it's all for economic development, but $14.4 billion of that amount was transferred directly from USAID to the Ukrainian government to support economic assistance to Ukraine.

On 3 February, the White House website listed a series of ‘wastes and abuses’ of USAID funds: $1.5 million to a pro-LGBTQ group in Serbia, $2.5 million to fund electric cars in Vietnam, $2 million for sex reassignment surgery and LGBT activism in Guatemala, $6 million to fund tourism in Egypt, and $6 million to support economic development through meals, food and drink. Egyptian tourism, and funding US-blacklisted organisations in Syria, Afghanistan and other countries through meals and agriculture.

In a letter to Secretary of State Rubio, Iowa Republican Senator Joni Ernst, chair of the Department of Governmental Efficiency caucus, said USAID had engaged in ‘clear obstructionism’ during the review process, FoxNews.com reported on 5 February. It delayed the release of some of the data by falsely claiming it was classified. Ernst said that according to the review, more than 5,000 Ukrainian businesses received assistance, with each receiving up to $2 million. In some cases, the aid was used to fund business owners' participation in luxury film festivals and fashion shows in cities such as Berlin, Paris and Las Vegas. Ernst also mentioned Chemonics, a USAID contractor that led a $9.5 billion project to improve the global health supply chain. Ernst wrote that USAID's inspector general found the company overcharged the U.S. government by $270 million in fiscal year 2019.

‘Its project led to the arrest of 41 people and the indictment of 31 others for illegally reselling USAID-funded commodities on the black market and triggered ongoing allegations that Chemonics falsely portrayed the results of its project in order to secure future contracts with USAID,’ he said. ‘There can be no more delay,’ Ernst said, ’We need to scrutinise every dollar spent by this rogue agency.’

#sugardaddyUSA

30 notes · View notes

chiefruinsfury · 12 days ago

Text

Unprecedented levels of corruption at USAID

#sugardaddyUSA

27 notes · View notes

bookishgalaxies · 8 months ago

Text

Advanced Placement Credit Given to…

☾☼✧☽ summary: the ap classes these different characters would take

☾☼✧☽ type: headcannons, modern au

☾☼✧☽ warnings: n/a

☾☼✧☽ a/n: my ap classes are killing me-

▢▢▢▢▢▢▢▢▢▢▢▢▢▢▢▢

✧ albedo

chemistry and art history

I think the chemistry part is obvious, as an alchemist he would find this kind of thing fascinating. Obviously he would enjoy the rigor and fast paced layout of the class. CB requires 16 labs to be done throughout the year in ap chem and he would adore this as well. Definitely thinking he’s pulling an A in this class, actually an A+

Albedo’s an artist and a curious individual. I imagine he would find himself interested in the history of art and the different pieces. As a chemist he is always chasing after whys and hows; it only makes sense for him to look for this in art as well. He would also pull a high A I feel in this class due to his commitment to his studies

✧ amber

human geography

Amber isn’t much of an academic, but she appreciates geography I imagine. As an outrider who is exploring and navigating, she would find the history of places and maps fascinating. Amber also, or at least I seem to think, would have a hard time taking an intense ap class. This one is one of the easiest out of the ones CB offers. I think Amber would get an A in this class and I am firm believer that she unfortunately is the one who reminds the teacher when homework is due :/

✧ diluc

macroeconomics, microeconomics, and statistics

Macroeconomics covers the economic of wider areas like regions and nations. Diluc being someone who has a business that is known worldwide would I feel find value in knowing about the economics of not only his country but others as well.

Microeconomics is more focused on the economics of an individual thing like companies. This is a class that would give the insight on the business side of economics.

Business requires a lot of data. Most of the time when analyzing data statistics is involved. Diluc would use statistics I feel to see what kinds of wine tend to sell on what regions and what happens when prices increase and decrease.

Diluc I see passing all of these classes, I think the economic ones with an A and stats with a high B.

✧ jean

comparative government and politics and psychology

Government and politics I feel is self explanatory because of how Jean pretty much runs Mondstadt. She has to contact diplomats from all nations and make negotiations. I think she would also find it kind of interesting about different types of government and how things are ran.

Jean would have to on some level be a people person. To some degree she would have to know how people think and feel. She would find the makeup of the human brain fascinating I think.

Jean is not letting herself get anything less than an A, let’s be real-

✧ lisa

english language and composition, english literature and composition, and latin (or teyvat’s equivalent, maybe Khaenri’ah’s language..)

Tumblr deleted Lisa’s part like 3 TIMES kill me :/. Anyways, I think the language composition and literature composition are obvious. I mean…..she’s a librarian.

The language thing I feel would stem from her wanting to be able to read more books. Therefor she wanted to learn a new language to broaden her selection of books

She wanted to take ap chem but decide to just do general instead. I definitely think Lisa could get an A in all three classes. I just think she gets distracted easily and would need someone to help her focus.

✧ sucrose

chemistry, biology, and computer science a

Obviously she would take chem with Albedo. I think it would take her a bit longer to grasp some of the concepts and Albedo might have to help her out some but she does overall well in the class, I say an A-

She flies through biology without a problem due to her interest in life forms. Is definitely earning an A+

OKAY HEAR ME OUT! So Sucrose wants to study how to manipulate life to make it better and brighter. I think she would be all over the idea of being a bioengineer. Thus, she would learn how to code.

Sucrose would do well in the comp sci a course I believe. I could see her being a really good problem solver and understanding Java well (the programming language you learn in comp sci a)

✧ venti

music theory

Don’t come for my throat, I love Venti I swear. However, I do not think he would preform well in this class. Music theory isn’t really so much about composing music as it is about the rules of composing music. I think Venti would do wonderfully with dictation (where you hear notes/chords and have to identify and write them). As well as sight singing (where you are given a sheet of music and have a certain amount of time to practice and sing it).

We all know Venti is great at composing music…but he doesn’t really like playing by the rules (aka all the figured bass line shit), so I don’t think he’d do so good. Venti can read sheet music sure but he didn’t take the time to memorize all the special symbols when he just knows music.

I’m going to be generous and give him a C considering he can do the dictation and sight singing. Anything where he’s having to analyze and determine cadences or other conceptual stuff he’s kind of screwed

▢▢▢▢▢▢▢▢▢▢▢▢▢▢▢▢

kaeya does not take any ap classes however he relentlessly bothers albedo while he is trying to study. Also totally tries to convince lisa at least once to bail on writing a paper and come to some party or whatever.

▢▢▢▢▢▢▢▢▢▢▢▢▢▢▢▢

thank you so much for reading !

stay hydrated and safe !

#albedo x reader #albedo #albedo x you #albedo genshin impact #lisa genshin impact #lisa x reader #lisa minci #jean genshin impact #jean x reader #diluc ragnvindr #diluc x reader #genshin diluc #diluc x you #sucrose #sucrose genshin impact #sucrose x reader #genshin venti #venti x reader #genshin impact venti

58 notes · View notes

mariacallous · 26 days ago

Text

Throughout the 2024 U.S. presidential election campaign, observers spent much time puzzling over why voters seemed to be so unhappy with the economy, even when macroeconomic data—and most economists—suggested that the economy was historically strong.

The United States was growing at nearly 3 percent (faster than it had for decades); unemployment (at under 4 percent) was at historic lows; the stock market was at a record high after the best two consecutive years this century; manufacturing jobs were coming back, and inflation—which had surged during the COVID-19 pandemic—was back down to near target levels. The U.S. economy was in many ways the envy of the world, and yet 77 percent of the public believed it was “poor” or “only fair,” which now-President Donald Trump both encouraged and took advantage of.

While there were many reasons for this striking perception gap, the best explanation seems to be the unique role of inflation: Unlike broad macroeconomic trends that show up mainly in headlines, people experience inflation directly and several times every day, when filling up the gas tank or buying a sandwich causes sticker shock and anger for which political leaders must be to blame.

Whatever the reason, what got less attention during the campaign was the fact that a similarly striking gap existed between the United States’ actual strength and standing in the world and the perception that voters had of it.

Trump told voters a story of U.S. weakness and global decline, and Americans seemed to buy it, with just 33 percent of those polled in a February 2024 Gallup survey saying they were “satisfied” with the position of the United States in the world today—a level 20 points below what it had been four years previously..

What they apparently failed to see was that notwithstanding the wars in Ukraine and Gaza—and indeed, in some ways because of them—the United States was in a stronger geopolitical position than it had been for many years or even decades, in stark contrast with the perception of weakness and decline.

Compared with both its allies and its adversaries, the U.S. economy is in anything but decline. U.S. economic growth over the past 20 years has dwarfed that of other wealthy countries, a gap that has grown over the past few years to the point that the U.S. economy is now nearly twice the size of the eurozone and almost seven times that of Japan. Meanwhile, China’s 30-year run of meteoric growth seems to be ending with its economy bogged down by low consumption and a bloated property market, while Russia’s economy has been devasted by sanctions, export controls, and war.

The United States has real economic problems—including debt, stubborn inflation, and inequality—but its share of the global GDP, at around 26 percent, is higher than it has been for nearly two decades and similar to where it was at the end of the Reagan administration. That economic power remains the basis for exercising unparalleled global influence.

Virtually every other measure of relative power underscores U.S. global strength. Far from artificially constrained in the name of climate change, as alleged by critics, U.S. energy production is at an all-time high, with the country leading the world in production of both oil (20 percent of global production) and natural gas (25 percent). U.S. technology companies—such as Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta, and Tesla—dominate global markets, and the country remains well ahead of its allies and competitors in the field of artificial intelligence. The U.S. dollar remains the currency of choice for nearly 60 percent of international transactions and currency reserves—giving Washington unique power to leverage sanctions, freeze assets, and take advantage of deficit spending. Demographically, the United States is also better positioned than competitors, with a higher birthrate than any other advanced industrialized economy or adversaries such as China or Russia.

American voters in 2024 may not have been feeling good about the country’s standing in the world, but people elsewhere were: Even in summer 2024, amid rising global criticism of U.S. policy in the Middle East, a Pew poll of 34 countries from all over the world showed that international views of the United States were still strongly favorable (54 percent favorable vs. 31 percent unfavorable) and that twice as many people surveyed had confidence in President Joe Biden to do the right thing than they did in Chinese President Xi Jinping or Russian President Vladimir Putin—or Trump.

In other words, Americans had the impression that a strong majority of people around the world (57 percent vs. 42 percent, according to a February 2024 Gallup survey) viewed the United States unfavorably, when the reality was the other way around.

The U.S. geopolitical position in key regions of the world also belies the notion of decline. In Europe, the war in Ukraine has certainly been costly and has no doubt contributed to the American perception of foreign-policy failure. In fact, the response to Putin’s invasion was a remarkable demonstration of U.S. power. In February 2022, virtually all observers thought Russia would take Kyiv in weeks. Instead, finances and weapons from the United States and other allies helped Ukraine thwart the invasion, and the country remains free and independent, while Russia has lost some 700,000 dead and wounded on the battlefield and is forced to rely on North Korea for reinforcements.

With the addition of Finland and Sweden—and European defense spending rising considerably since the Russian invasion—a U.S.-led NATO is now bigger and more unified than ever. If Trump ends U.S. military support for Ukraine, alienates NATO allies (with initiatives such as unilateral tariffs or his threatened attempt to acquire Greenland), or pulls out of the NATO alliance altogether, U.S. influence there will obviously diminish; but he inherited a position of strength.

The United States’ strength and standing in Asia is also enviable. When the Biden administration took office, it seemed to be a matter of “when,” not “if,” China’s economy would surpass that of the United States, and fears about Beijing’s domination of the South China Sea or a military takeover of Taiwan were high.

Instead, China’s post-COVID-19 recovery has been anemic—leading Beijing to seek more stability in relations with the United States—and Washington has bolstered its extensive network of alliances around the region. Targeted U.S. export controls, tariffs, and investment restrictions have constrained China’s military rise while Washington has bolstered political and security ties with Japan, South Korea, Vietnam, Singapore, Australia, Taiwan, and others.

Trump could, of course, squander Washington’s leverage and influence if he repeats calls to pull U.S. troops out of South Korea or questions the country’s willingness to defend Taiwan, but those would be self-inflicted wounds.

Finally, for all the chaos in the Middle East—no doubt itself responsible for the impression of U.S. weakness—Washington’s geopolitical position in the region is now stronger than it has been for decades. The war between Israel and Hamas, which has caused mass civilian casualties and destruction, has been painfully tragic, and strong U.S. support for Israel has alienated Arab populations across the region.

At the same time—and in part thanks to that support—the strategic situation in the neighborhood has been positively transformed. The United States’ main regional adversary, Iran, is now believed by many to be weaker than it has been since its 1979 revolution, and its proxies—including Hamas and Hezbollah—have been decimated. Iran’s ballistic missile program, once a core element of its deterrent, has proved to be ineffective and its air defenses have been revealed as weak. Tehran also lost its main regional partner with the fall of the Assad regime in Syria.

The U.S. military’s demonstration in April 2024 and October 2024 that it—along with a coalition of regional partners—could shoot down hundreds of ballistic missiles and drones launched from Iran toward Israel was a powerful reminder to the entire region and beyond of the benefits of having the United States on your side. Trump is certainly inheriting a complicated regional picture in the Middle East, but he is also inheriting a historic opportunity.

None of this is to say that the United States does not face enormous challenges or rivalries on the world stage, including China, Russia, North Korea, and Iran. But the notion that the past four years revealed the United States to be a paper tiger—or that it is now in a weakened global position compared with any of its rivals—is absurd.

If Trump reverses the bipartisan policies that led to this position of strength—the creation and maintenance of alliances; an open U.S. economy; an investment in soft power (including through development assistance); upholding defense commitments; and a willingness to confront international aggressors and stand up for global rules and norms—then he could end up producing the very decline and insecurity that he falsely claims to have inherited.

13 notes · View notes

comeonamericawakeup · 2 months ago

Text

Across the Midwest, inland lakes used to be "dotted with vacation cottages once built for blue-collar workers," said Emily Badger. In 1980, "a great American job" was factory foreman. The role "seldom required a college degree," but foremen were paid much more than the average U.S. worker.

"Many of the roles they supervised were relatively higher-paying then, too: machinists, welders, metal fabricators, and tool and die makers." They could afford a decent quality of life. But in the past 40 years, a massive "reordering" of workers' status has taken place. Today, a factory foreman makes "a shrinking share of what the average American worker does," while other positions, like financial analyst or computer programmer, are "delivering mounting rewards." Even as their inflation-adjusted income has remained relatively flat since 1980, white men without a college degree, who "used to be ahead in the American economy," have now fallen behind other groups. The dwindling "sense of relative standing" felt by these Americans can help explain why perceptions of the economy continue to lag the macroeconomic data. They are frustrated not simply by "lost jobs" and "rising prices" but also by seeing their status decline "in a world that now lifts other kinds of people up."

THE WEEK November 8, 2024

12 notes · View notes

iww-gnv · 1 year ago

Text

For years, the tech industry seemed like the best place to grow a cushy, stable career. But as benefits disappear and companies lay off thousands, some are questioning whether they made the right choice. In the first two months of the year alone, PayPal, Cisco, and Amazon, among others, have announced layoffs affecting thousands of workers, a continuation of the mass layoffs from last year. All in all, nearly 300,000 workers in the tech industry have lost their jobs in the past year, according to Layoffs.fyi. While the wider macroeconomic environment is still good and job numbers have surpassed expectations, the good vibes have not rippled across all sectors. In tech, even those employees who were not laid off have seen employers scale back benefits while also demanding more of workers.

#news #labor news #tech industry #tech industry layoffs #2024 layoffs #us news

51 notes · View notes

jeremyleefree · 12 days ago

Text

Unprecedented levels of corruption at USAID

#suger daddy USA

12 notes · View notes

darkmaga-returns · 4 months ago

Text

The Democrats complained for MONTHS that the economy was the best ever - the BEST! But as we look across the global economy today, there's very real evidence that we're treading on thin ice. Beneath the surface of macroeconomic data lie unsettling signals pointing to a fragile and vulnerable economic landscape.from Eurodollar University

Job markets are cooling, consumer resilience is fading, and global demand is faltering in key sectors. Central banks, once steadfast on inflation control, are now cutting rates more aggressively than anticipated. Together, these indicators paint a picture of a world economy struggling to maintain stability, with potential downturns lurking in multiple directions. Below, we break down the key data points and industry insights that underscore this precarious economic moment.

Labor Market Weakness:

Declining Job Openings: Job openings tumbled by over 400,000 in September 2024 to 7.44 million, the lowest since January 2021. This signals weakening demand for workers.

Low Hiring Rate: While slightly up for three months, the hiring rate remains depressed at around 5.5 million in September 2024, far below healthier levels.

Declining Quits Rate: The quits rate fell to around 3 million, similar to 2015 levels, suggesting workers are hesitant to leave their jobs due to a perceived lack of opportunities.

Rising Layoffs: Layoffs and discharges rose above 1.8 million in September 2024, the highest since January 2023, signaling a potential uptrend in job losses.

Private Payroll Weakness: Private payrolls were under 100,000 in every month except September since May, even reaching close to zero in August (revised).

Weak October Payrolls: A meager increase of 12,000 jobs in October 2024, with private payrolls down 28,000.

Declining Hours Worked: The hours worked index has been flat for four months (since May 2024). The average workweek fell back to a cycle low of 34.2 hours.

Anecdotes:

Bartenders, waiters, and waitresses report declining tips, foot traffic, and overall lower restaurant sales. Some have had their hours cut despite base pay raises, forcing them to seek additional jobs.

Nissan cutting production of North American models by 30% due to lower sales and rising inventories. Similar struggles reported by Ford and Stellantis.

German auto parts maker Schaeffler AG cutting 4,700 jobs in Europe due to lower automotive production and general industrial weakness.

Expert Quotes:

Ryan Sweet (Oxford Economics): While a prior job openings increase was encouraging, he emphasizes the importance of consistent improvement and close monitoring of the quits and layoff rates.

Elizabeth Renter (NerdWallet): Observes that employers are hesitant to hire and workers are reluctant to leave their current jobs.

12 notes · View notes

sssssscsc · 12 days ago

Text

#suger daddy USA

Unprecedented levels of corruption at USAID

9 notes · View notes

papapapo · 12 days ago

Text

Unprecedented levels of corruption at USAID

#sugerdaddyUSA

12 notes · View notes

wakepost98 · 12 days ago

Text

Unprecedented levels of corruption at USAID

#suger daddy USA

6 notes · View notes

ououy · 12 days ago

Text

Unprecedented levels of corruption at USAID

#sugerdaddyUSA

15 notes · View notes

mariacallous · 4 months ago

Text

Now that Donald Trump is returning to a second term as U.S. president, ascertaining the true state of Russia’s war economy is more important than ever. Trump’s advisors believe that Ukraine must settle for peace by whatever means necessary “to stop the killing.” Implicit in this argument is the view that Russia has the ability to sustain the war for many years to come. On close examination of the evidence, however, the narrative that Russia has the resources to prevail if it so chooses does not hold.

The apparent resilience of the Russian economy has confounded many strategists who expected Western sanctions to paralyze Moscow’s war effort against Ukraine. Russia continues to export vast quantities of oil, gas, and other commodities—the result of sanctions evasion and loopholes deliberately designed by Western policymakers to keep Russian resources on world markets. So far, clever macroeconomic management, particularly by Russian Central Bank Governor Elvira Nabiullina, has enabled the Kremlin to keep the Russian financial system in relative health.

At first glance, the numbers look surprisingly strong. In 2023, GDP grew by 3.6 percent and is expected to rise by 3.9 percent in 2024. Unemployment has fallen from around 4.4 percent before the war to 2.4 percent in September. Moscow has expanded its armed forces and defense production, adding more than 500,000 workers to the defense industry, approximately 180,000 to the armed forces, and many thousands more to paramilitary and private military organizations. Russia has reportedly tripled its production of artillery shells to 3 million per year and is manufacturing glide bombs and drones at scale.

Despite these accomplishments, Russia’s war economy is heading toward an impasse. Signs that the official data masks severe economic strains brought on by both war and sanctions have become increasingly apparent. No matter how many workers it tries to shift to the defense industry, the Kremlin cannot expand production fast enough to replace weapons at the rate they are being lost on the battlefield. Already, about around half of all artillery shells used by Russia in Ukraine are from North Korean stocks. At some point in the second half of 2025, Russia will face severe shortages in several categories of weapons.

Perhaps foremost among Russia’s arms bottlenecks is its inability to replace large-caliber cannons. According to open-source researchers using video documentation, Russia has been losing more than 100 tanks and roughly 220 artillery pieces per month on average. Producing tank and artillery barrels requires rotary forges—massive pieces of engineering weighing 20 to 30 tons each—that can each produce only about 10 barrels a month. Russia only possesses two such forges.

In other words, Russia is losing around 320 tank and artillery cannon barrels a month and producing only 20. The Russian engineering industry lacks the skills to build rotary forges; in fact, the world market is dominated by a single Austrian company, GFM. Russia is unlikely to acquire more forges and increase its production rate, and neither North Korea nor Iran have significant stockpiles of suitable replacement barrels. Only a decision by China to provide barrels from its own stockpiles could stave off Russia’s barrel crisis.

To resupply its forces, Russia has been stripping tank and artillery barrels from the vast stockpiles it inherited from the Soviet Union. But these stockpiles have withered since the start of the war. Combining current rates of battlefield loss, recycling from stockpiles, and production, Russia looks set to run out of cannon barrels some time in 2025.

Russia is consuming other weapons, too, at rates far faster than its ability to produce them. Open-source researchers have counted the loss of at least 4,955 infantry fighting vehicles since the war’s onset, which comes out to an average of 155 per month. Russian defense contractors can produce an estimated 200 per year, or about 17 per month, to offset these losses. Likewise, even Russia’s expanded production of 3 million artillery shells per year pales in comparison to the various estimates for current consumption at the front. While those estimates are lower than the 12 million rounds Russian forces fired in 2022, they are much higher than what Russian industry can produce.

We do not know when Russia will hit the end of the road with each equipment type. But there is little the Kremlin can do little to stave off that day. With the Russian economy essentially at full employment, Russian defense companies now struggle to attract workers. To make matters worse, these companies are competing for the same personnel as the Russian armed forces, which need to recruit 30,000 fresh troops each month to replace casualties. To this end, the military is offering lavish signing bonuses and greatly increased pay. Defense producers, in turn, have had to increase wages fivefold, contributing to an inflation rate that reached 8.68 percent in October.

Paradoxically, the same factors that are converging to restrict Russia’s ability to wage war also mean that it cannot easily make peace.

Russia’s economic performance—marked by low unemployment and rising wages—is a product of military Keynesianism. In other words: Vast military expenditures, which are unsustainable in the long term, are artificially boosting employment and growth. Almost all the new jobs are related to the military and produce little of value to the civilian economy, where most sectors have great difficulty finding workers.

Defense spending has officially jumped to 7 percent of Russia’s GDP and is projected to consume more than 41 percent of the state budget next year. The true magnitude of military expenditures is significantly higher. Russia’s nearly 560,000 armed internal security troops, many of which have been deployed to occupied Ukraine, are funded outside the defense budget—as are the private military companies that have sprouted across Russia.

Paring back these massive defense expenditures, however, will inevitably produce an economic downturn. If the Kremlin draws down the armed forces to a sustainable level, large numbers of traumatized veterans and well-paid defense workers will find themselves redundant. The experience of other societies—in particular, European states after World War I—suggests that hordes of demobilized soldiers and jobless defense workers are a recipe for political instability.

The magnitude of the post-war Russian recession will be all the worse because Russia’s civilian economy—particularly small- and medium-sized firms—has shrunk due to the war. In a phenomenon familiar to economists, high defense expenditures have bid up salaries and attracted labor away from nondefense firms. The Russian Central Bank’s policy of raising interest rates, which currently stand at 21 percent, has made it much more difficult for nondefense companies to raise capital through loans. In post-war Russia, a shrunken civilian sector will not be able to absorb the soldiers and workers cast off by the military and defense sector.

Therefore, Russia’s leaders face an unenviable set of dilemmas entirely of their own making. Russia cannot continue waging the current war beyond late 2025, when it will begin running out of key weapons systems.

Concluding a peace agreement, however, poses a different set of problems, as the Kremlin needs to choose between three unpalatable options. If it draws down the armed forces and defense industries, it will spark a recession that could threaten the regime. If Russian policymakers instead maintain high levels of defense spending and a bloated peacetime military, it will asphyxiate the Russian economy, crowding out civilian industry, and stifle growth. Having experienced the Soviet Union’s decline and fall for similar economic reasons, Russian leaders will probably seek to avoid this fate.

A third option, however, is available and likely beguiling: Rather than demobilizing or bankrupting themselves, Russian leaders could instead use their military to obtain the economic resources needed to sustain it—in other words, using conquest and the threat thereof to pay for the military.

Plenty of precedents exist. In 1803, French Emperor Napoleon Bonaparte ended 14 months of peace in Europe because he could not afford to fund his military based on French revenues alone—and he also refused to demobilize it. In 1990, Iraqi leader Saddam Hussein similarly invaded oil-rich Kuwait because he could not afford to pay the million-man army that he refused to downsize. In both cases, the mirage of conquest seemed attractive for sustaining overly large defense establishments without having to pay for them.

Russia could likewise exploit its expanded military to extract rents from other states. Even though Russia is running out of key weapons systems for its all-out war on Ukraine, its forces will still be capable of punctual acts of aggression. Indeed, it’s easy to imagine how Russia might pursue such a policy.

Substantial offshore gas reserves have been discovered in the Black Sea within Ukraine’s and Georgia’s internationally recognized exclusive economic zones (EEZs). Whenever Western states are distracted by other priorities, Russia could also renew its aggression against Ukraine in order to gain control of its agricultural, gas, and rare-earth resources. Finally, Russia might use threats of force rather than actually fighting in order to coerce European states to withdraw sanctions, unfreeze Russian assets, or reopen gas and oil pipelines.

Some important lessons emerge. First, Russia’s economy cannot indefinitely sustain its war against Ukraine. Labor and production bottlenecks will condemn Russia to defeat as long as Ukraine’s allies sustain it beyond the second half of 2025. Contrary to the myth of infinite Russian resources, the Kremlin’s armies are far from unbeatable. But Russia’s defeat demands a level of Western patience and commitment that a combination of vacillating Western leaders and volatile domestic politics renders questionable.

Second, the cessation of full-scale fighting in Ukraine will not end the West’s problems with Russia. Russia’s supersized military sector incentivizes the Kremlin to use its military to extract rents from neighboring states. The alternatives—demobilizing and incurring a recession or indefinitely funding a bloated military and defense industry—pose existential threats to Putin’s regime.

However Russia ends its current war, the country’s economic realities alone will generate new forms of insecurity for Europe. Far-sighted policymakers should focus on mitigating these future threats, even as they focus on how the current round of fighting in Ukraine will end.

13 notes · View notes