Congressional Trifecta: Ticking-off Iran, China, and Russia

Congress passed bills on 20 April 2024 that provide a total of $95 billion in military aid to Israel, Taiwan, and Ukraine (includes funds for replenishing U.S. military stocks and covering costs of U.S. military operations in Persian Gulf); lead to a U.S. ban on TikTok; add sanctions on Iran; and steal billions of Russian assets held in the U.S. A dark day for “safe haven” investments in U.S., U.S. foreign policy, and U.S. Citizens—our Constitutional rights were stripped by Congress, and tax dollars shipped to foreign lands; but an excellent day for the Iran-Russia-China “Tripartite Alliance,” which will retaliate against the U.S. in Asia-Pacific and Middle East.

For those who hew to realpolitik, it is dismaying to hear rubbish of the sort spewed by the Speaker of the U.S. House of Representatives, Michael Johnson: “it’s a Biblical admonition to stand with Israel.” Religious fanaticism (Christian Zionism); irrationality (“Putin is evil”; “Xi is a dictator”; “Xi, Putin, and Iran ‘Axis of evil’”); and endemic Washington corruption, which feeds the “Military-Industrial Complex” (see Eisenhower’s prophecy about the “MIC” in his 1961 Farewell Address), which funnels cash to politicians. This process is a “self-licking ice cream cone.” These three factors, not rationale, drive American foreign policy. Policy is created ad hoc by political naïfs. There is no overarching grand strategy or strategy.

Iran: it will shrug off sanctions. The country has been under sanctions since 1979, and “maximum pressure” sanctions since 2018. Iran has “sanctions-proofed” its economy. People, however, suffer hardships, especially for imported goods (foodstuffs and medicines; electronic devices like mobiles and computers) and foreign travel, which are priced in dollars. The Iranian rial has depreciated heavily against the U.S. dollar because of sanctions. But Tehran will chafe given that sanctions were added against it consequent to Iran’s exercise of its right to self-defense under international law.

China: The TikTok ban faces legal hurdles, including in the U.S. Supreme Court, given free speech protections under the First Amendment. Nonetheless, Beijing will see the transfer of arms to Taipei and putative TikTok ban as a direct assault on its geo-political and economic interests.

Russia: The theft of $6 bil. in Russian state assets will only accelerate plunging confidence in U.S. markets and U.S. dollar. It is clearly unsafe to invest in the United States, where assets can be stolen by whim of Congress; or to hold U.S. dollars since a country can be sanctioned by whim of Congress for using USD. BRICS+ and proposed introduction of BRICS+ alternative (gold-backed) currency will accelerate the decline of the USD. One need only track increases in the prices of gold and silver over the past six months to see the shift in investor sentiments due to, inter alia, loss of confidence in the U.S. economy and government. Gold has climbed over 21% in six months. Russia pegged the ruble to gold in 2022; the jump in gold prices naturally benefits Russians and the Russian economy.

Funds and armaments to Ukraine will not change the equation on the ground. The U.S. Treasury can print dollars but it cannot print ammunition and men. Shortages of munitions, especially 155mm artillery shells, cannot be addressed in the short-term. Only four countries have large stockpiles of, and production facilities for, artillery shells: North Korea, China, Iran, and Russia. Methinks they will not supply Ukraine! The “butcher’s bill” in Ukraine is high; hundreds of thousands of Ukrainians are KIA, MIA, WIA, or have fled the draft (see video belows). Women are being recruited (and dying); men and boys are being press-ganged (e.g., here, here, here; and resisting, e.g., here, here, here) and fed to the “meat-grinder” (see videos of graveyards). The funds for Ukraine may delay its inevitable collapse but will not prevent it. Commentators have noted, correctly, that the bill aims to prevent the collapse of Ukraine before election day.

Conclusion

U.S. dollar hegemony and USA as a “safe haven” for foreign investors are dying because of the U.S. Government’s twin addictions: arbitrary sanctions and perpetual war to feed the MIC. How America destroyed the U.S. dollar’s hegemony, and how China, Russia, and Iran responded to the bills passed on Saturday, will doubtless be studied by historians, economists, and foreign policy specialists in the future. Empires don’t suddenly collapse and die. They commit suicide—slowly.