Today’s News 14th April 2022

• Majority Of Brits Say Johnson Should Go
  Majority Of Brits Say Johnson Should Go

  57 percent of the public believe UK Prime Minister Boris Johnson should resign, according to a snap poll carried out by YouGov on April 12, the day he was found to have broken the law over ‘partygate.’

  As Statista’s Anna Fleck reports, Johnson is the first ever UK prime minister to be caught breaking the law while in office. He now faces calls to step aside from Labour leader Sir Keir Starmer, the Welsh and Scottish first ministers, as well as Conservative MP Tory Nigel Mills, as the Independent reports. According to British law however, it is up to him, or the majority of his party, to choose whether or not to stand aside. At present, he has given no indication of doing so.

  According to Statista’s chart, a clear majority want Johnson to resign, with only 30 percent of respondents saying that he should remain in his role. It’s a sentiment felt across the UK. Johnson faces heavy criticism in London, where 62 percent of the surveyed public think he should resign. Scotland has seen the highest levels of disapproval, with 67 percent of people believing it is time for him to go. The South, which has pulled in more blue voters over past years, is slightly more closely tied at 51 percent.

  

  You will find more infographics at Statista

  Boris Johnson, his wife Carrie Johnson, and Chancellor of the Exchequer Rishi Sunak all received fines after the Metropolitan Police found them guilty of attending a 56th birthday event for the PM at No.10 Downing Street last summer, breaching Covid rules, when the rest of the country was in lockdown. In a further poll, YouGov found that 75 percent of the population think Boris Johnson knowingly lied about not knowing he broke the lockdown rules, with 13 percent saying they did not know. Only 12 percent of people thought it was an honest mistake.

  As The Guardian notes, this is important because a known lie to the House of Commons would be a breach of the ministerial code.

  Tyler Durden
  Thu, 04/14/2022 – 02:45

• Can Ukraine Ever Win?
  Can Ukraine Ever Win?

  Authored by Victor Davis Hanson,

  Even a truncated Russian Federation has four times the pre-war population of Ukraine. It enjoys well over 10 times the Ukrainian gross domestic product. Russia covers almost 30 times Ukraine’s area.

  And how does Ukraine expel Russian troops from its borders when its Western allies must put particular restrictions on their life-giving military and financial aid?

  The interests of Europe and the United States are not quite the same as those of a beleaguered Ukraine. NATO also wants Russian President Vladimir Putin humiliated, but only if the war can be confined within the borders of Ukraine.

  

  The West seeks a resounding reaffirmation for the supposed “rules-based international order” that prevents aggressive invasions across national borders – but not at the price of a nuclear exchange.

  So to accomplish those grand agendas, the West restricts some of its generous supplies to Ukraine.

  It sends plenty of lethal weapons – as long as some of them will not provoke a losing Russia into doing something stupid, like resorting to tactical nuclear weapons to save face.

  There are other complications.

  Time is fickle. In theory, it should favor a resilient Ukraine.

  The longer the war goes on, the more sanctions will hurt the Russian economy and insidiously undermine Russian public support for the war.

  On the other hand, the longer the war continues, the greater the Russian losses, and the fewer acceptable off-ramps for Putin, all the more likely he will grow desperate and escalate to Gotterdammerung levels.

  Admittedly, Putin is no longer fighting to win over Ukraine and force it back intact into the Russian federation. He is no longer wary of eradicating infrastructure that he once felt would once again become valuable Russian assets.

  Instead, Russia is going full Carthaginian peace in Eastern Ukraine – leveling cities, murdering civilians, and destroying an entire modern society for generations.

  There is as yet still no deterrent force that can stop Putin’s bombs and missiles and disrupt his nihilist strategy. Again, Putin feels liberated by caring nothing about international opinion, and less than nothing about Western outrage over reported Russian war crimes.

  He instead believes the stick, of an unpredictable Russia with 7,000 nuclear weapons, and its carrot, of becoming the world’s largest daily producer of oil, can cut a lot of lofty talk about humanity.

  So the war has become more complex precisely because Putin failed in his initial shock-and-awe effort to decapitate the Ukrainian government, storm the cities, and install a puppet government.

  Putin’s strategy is now paradoxically much simpler – and harder to stop. He will claim victory by institutionalizing Vichy-like Russian states in the Donbass region and Crimea.

  In the meantime his air attacks will render Eastern Ukraine an inert wasteland that will require decades to rebuild.

  Even after an armistice, Putin can periodically threaten to expand his devastation to Western Ukraine, should he feel Kyiv is once again growing too close to Europe.

  So can Ukraine ever win?

  Ukraine must stop the airborne wreckage by gaining air supremacy through the use of more sophisticated and larger anti-aircraft batteries and far more SAMs and Stinger smaller systems. Some NATO nations may have to send Ukraine their Soviet-era fighters to replace losses – with conditions that they stay inside Ukrainian air space.

  Second, the supply war must no longer be defined as a larger Russian economy versus tiny Ukraine.

  Instead, Putin is now warring against the supply chain of all of Europe and the United States – and all out of his reach. The Ukrainian war machine will only grow – if fueled by allies that combined account for 70 percent of the world’s GDP.

  Putin cannot stop the influx of Western help unless he threatens to use nuclear weapons.

  Ukraine may reach a tipping point soon if it can both stop Russian air attacks and expel Putin’s ground troops from its cities.

  But Kyiv cannot realistically invade Russia to hit its supply depots. It cannot go nuclear to deter future Russian invasions. It cannot shame a bloodthirsty Putin on the world’s humanitarian stage.

  And it cannot join NATO to win the direct help of 30 other nations.

  But what Ukraine can do is push Russian troops back to the border regions and let the Russian-speaking Ukrainian borderlands work out their own star-crossed relationships with a now blood-soaked and unreliable Putin.

  It can inflict such death and destruction on the conventional Russian military that Putin will fear he will suffer even worse global humiliation that the United States faced after Afghanistan.

  Ukraine can also seek an armistice along the Black Sea coast.

  It might agree to a plebiscite or some sort of demilitarized zone and small-scale population exchanges to ensure that Crimea does not become a permanent battleground.

  All that is not outright victory, but it is something.

  And that something was not imaginable when Russia invaded in late February.

  Tyler Durden
  Thu, 04/14/2022 – 02:00

• Taiwan Gives Citizens Survival Handbook In Case Of Chinese Invasion
  Taiwan Gives Citizens Survival Handbook In Case Of Chinese Invasion

  Taiwan’s military took the dramatic step of issuing a public emergency handbook meant to prepare all citizens in the event of a Chinese invasion of the island. The 28-page booklet includes detailed instructions on bomb shelter locations and how to stockpile emergency supplies, as well as basic life-saving steps.

  While introducing the handbook in a Tuesday online press conference, defense ministry spokesman Sun Li-fang explained that “the general public can use as an emergency response guideline in a military crisis or natural disaster.”

  

  But of course, the only crisis or disaster looming on people’s minds is the potential for an all-out Chinese PLA military assault – fears that have ratcheted particularly since the Russian invasion of Ukraine, which Beijing has at times appeared to defend, while also refusing to call Putin’s action an “invasion”. 

  A statement from the specific defense ministry department that authored the booklet, called the “All-Out Defense Mobilization Agency” had this to say: “The guide is for the public to better prepare themselves before a war or disaster happens.”

  According to the AFP it’s been inspired of similar guides that the countries of Japan and Sweden have produced for their citizens, and includes info on “where to find bomb shelters via mobile phone apps and what to do in an emergency including how to distinguish air raid sirens.” 

  Or also there are emergency preparedness instructions which cover events like mass power outages and blackouts, large fires, building collapses, or devastating weather. Taiwan authorities express further, “We hope the public can familiarise themselves where the safety shelters are beforehand.”

  Taiwan’s government issued an invasion survival handbook Tuesday, as Russia’s war in Ukraine has raised fears that China may consider similar moves to bring the island into its fold. pic.twitter.com/DOLZURLSPt

  — Radio Free Asia (@RadioFreeAsia) April 12, 2022

  https://platform.twitter.com/widgets.js

  While Taipei has lately accused China’s leaders of saber-rattling, also the PLA Air Force continues its weekly aircraft incursions of the islands Air Defense Identification Zone, Beijing has in turn pointed the finger over certain provocations. For example, it was revealed and confirmed last year that there has long been a contingency of US Marines and special forces on the island training Taiwanese forces. 

  The democratic island has also been hosting more and more US official delegations, and House Speaker Nancy Pelposi was expected earlier this month, but canceled the trip last-minute as she tested positive for Covid-19.

  Tyler Durden
  Wed, 04/13/2022 – 23:20

• Robert Reich Goes Full Orwellian: More Freedom Is Tyranny
  Robert Reich Goes Full Orwellian: More Freedom Is Tyranny

  Authored by Jonathan Turley,

  We recently discussed the gathering of Democratic politicians and media figures at the University of Chicago to discuss how to better shape news, combat “disinformation,” and reeducate those with conservative views.

  The political and media elite shared ideas on how to expand censorship and control what people read or viewed in the news. The same figures are now alarmed that Elon Musk could gain greater influence over Twitter and, perish the thought, restore free speech protections to the site. The latest is former labor secretary under President Clinton, Robert Reich, who wrote a perfectly Orwellian column in the Guardian titled “Elon Musk’s vision for the internet is dangerous nonsense.”

  However, the column offers an insight into the anti-free speech mentality that has taken hold of the Democratic party and the mainstream media.

  

  Musk is an advocate for free speech on the Internet.

  Like some of us, he is an Internet originalist.

  That makes him an existential threat for those who have long used “disinformation” as an excuse to silence dissenting views in the media and on social media.

  Reich lays that agenda bare in his column.

  Reich explains that it is not about freedom but tyranny. More free speech means less freedom.

  It is the type of argument commonly used in China and other authoritarian nations–and an increasing number of American academics and writers. Indeed, his column is reminiscent of the professors who have called for the adoption of the Chinese model for censoring views on the Internet.

  In an article published in The Atlantic by Harvard law professor Jack Goldsmith and University of Arizona law professor Andrew Keane Woods called for Chinese-style censorship of the internet, stating that “in the great debate of the past two decades about freedom versus control of the network, China was largely right and the United States was largely wrong.”

  Reich tells people not to be lured by freedom of speech: “Musk says he wants to ‘free’ the internet. But what he really aims to do is make it even less accountable than it is now.” What Reich refers to as “accountability” is being accountable to those like himself who can filter out views and writings that are deemed harmful for readers.

  Reich then goes full Orwellian:

  “Musk advocates free speech but in reality it’s just about power. Power compelled Musk to buy $2.64bn of Twitter stock, making him the largest individual shareholder.”

  Reich insists that censorship of views like former President Donald Trump are “necessary to protect American democracy.” Get it? Less freedom is more freedom.

  The column gets increasingly bizarre as Reich cites the fact that Musk has continued to express banned thoughts as proof that he is a menace:

  “Billionaires like Musk have shown time and again they consider themselves above the law. And to a large extent, they are. Musk has enough wealth that legal penalties are no more than slaps on his wrist, and enough power to control one of the most important ways the public now receives news. Think about it: after years of posting tweets that skirt the law, Musk was given a seat on Twitter’s board (and is probably now negotiating for even more clout).”

  Reich then delivers his terrifying warning:

  “That’s Musk’s dream. And Trump’s. And Putin’s. And the dream of every dictator, strongman, demagogue and modern-day robber baron on Earth. For the rest of us, it would be a brave new nightmare.”

  That nightmare, of course, is free speech. It is a nightmare that people like Reich and those at the “Disinformation conference” will lose control over media and social media.

  Imagine a site where people are largely free to express themselves without supervision or approval. What a nightmare.

  [Warning foul language and full irony]

  Tyler Durden
  Wed, 04/13/2022 – 23:00

• NYC Doormen Threaten First Strike In 30 Years
  NYC Doormen Threaten First Strike In 30 Years

  The labor-organizing bug has clearly caught on in NYC – from the Amazon warehouse employees who package and ship products to the doormen who receive the packages on the other end of the “last mile” and deliver them to their well-heeled residents.

  

  One week after workers at an Amazon facility on Staten Island succeeded in their vote to unionize (a vote that the company is now trying to contest), a group of doormen for Manhattan’s elite buildings are driving a hard bargain, and threatening to go on strike if their demands aren’t met, in their latest round of contract negotiations, according to a report from WSJ.

  The union plans to hold a vote on whether to strike on Wednesday.

  An estimated 32,000 doormen, superintendents, maintenance workers and other residential-building staff could go on strike if an agreement isn’t reached before their contract expires April 20, according to their SEIU-32BJ union.

  If the parties fail to reach a suitable agreement and the strike commences, it will be the union’s first strike since 1991, when work was stopped for 12 days.

  Per WSJ, the biggest sticking point in negotiations comes down to health benefits. Under the current contract, workers don’t pay anything for family health-insurance premiums, but building owners are demanding that they should start shouldering part of the (rapidly-growing) cost of their health plans. However, a specific amount hasn’t been proposed.

  Management says that the average worker pays a portion of their health-care costs, and that their workers should also pay their “fair share”.

  “The average employee in the United States makes a contribution for family health coverage,” said Howard Rothschild, president of the Realty Advisory Board on Labor Relations, which represents building owners and agents. “We believe, in terms of this, our group of employees should pay their fair share.”

  But union president Kyle Bragg says the workers – who earn an average of $55K a year – are being squeezed by rising costs and “…we won’t hesitate if we believe that we are being treated unfairly.”

  Unsurprisingly, the WSJ managed to find some champagne socialists who live in the luxury high-rises to go on the record in support of the union’s efforts.

  Aaron Craig, who lives in a luxury high-rise in the financial district, said he supports the workers even though his building’s management warned that residents would have to take out their own trash and retrieve food deliveries if doormen and other staff go on strike.

  “I think it’s pretty clear that the union is in the right, so I hope they succeed,” said Mr. Craig, 33 years old, who works as a data scientist for a social-media company.

  The paper also noted that the doormen were deemed “essential” workers and had to show up to work every day during the pandemic, while their well-heeled residents were able to flee to the suburbs.

  Tyler Durden
  Wed, 04/13/2022 – 22:40

• USPS Stops Service To Santa Monica Neighborhood Following Attacks On Mail Carriers
  USPS Stops Service To Santa Monica Neighborhood Following Attacks On Mail Carriers

  Authored by Jamie Joseph via The Epoch Times (emphasis ours),

  One neighborhood in Santa Monica will not be receiving postal service from the U.S. Postal Service (USPS) until further notice after “multiple carriers have been subjected to assaults and threats of assault from an individual who has not been located or apprehended,” according to a postal letter sent out to residents alerting them of the change.

  

  Santa Monica residents located on the 1300 block of 14th Street received a USPS letter on April 7 which read, “the safety of our employees and of the mail they deliver to you is our highest concern. Until we can ensure the safety of both, delivery services will remain suspended.”

  It’s unclear when the services for paper mail will resume, but private carriers are still delivering packages to the neighborhood.

  Residents in the neighborhood are encouraged to pick up their mail at the post office on 7th Street.

  Only one assault has been officially reported, according to a CBS report, and the victim did not press charges. But a USPS spokesperson said there have been three separate incidents with three different carriers in the neighborhood over the last few months.

  The U.S. Postal Inspection Service, the law enforcement branch of the USPS, told The Epoch Times in an emailed statement that they are “aware of the recent reports of suspicious activity towards Postal Carriers in Santa Monica, California.”

  “Postal Inspectors are currently investigating the incidents and are unable to comment further at this time,” a U.S. Postal Inspection Service spokesperson said. “Postal Inspectors encourage anyone who observes suspicious activity involving U.S. Mail to report it to local police and to Postal Inspectors at 1-877-876-2455.”

  Lt. Erika R. Aklufi of the Santa Monica Police Department told The Epoch Times in an email that the “USPS issued the letter and as far as we know did not contact our department before sending it.”

  “I tried calling the two phone numbers on the letter—one went unanswered, the other had a voicemail box that is full,” Aklufi wrote in the email.

  Aklufi said, with a lead from one of the Santa Monica police officers who is familiar with the location, officers located a crime report for an assault with a deadly weapon—a broomstick—incident on a USPS mail carrier on the 1300 block of 14th Street on Jan. 19.

  The suspect lived in the area “and is known to our officers and also to the mail carrier he attacked,” Akulfi said.

  The victim sustained a minor injury to his arm and did not require medical attention, she said, and the officers who took the report contacted the U.S. Postal Inspection Service on the day of the incident to provide information should they wish to follow up.

  “We do not know if the [U.S. Postal Inspection Service] did so,” she said.

  Other incidents of USPS mail carriers being attacked were not identified.

  “Without speaking to the postmaster, it will be difficult to know the extent of this issue. I have never heard of the Postal Service suspending service for all residents in a neighborhood, and can only refer you to them for answers about their course of action,” she said.

  Tyler Durden
  Wed, 04/13/2022 – 22:20

• Watch: Driver Of Tesla Says Computer Froze At 83 MPH 
  Watch: Driver Of Tesla Says Computer Froze At 83 MPH 

  A terrifying situation played out last week when the owner of a new Tesla Model 3 was driving down a stretch of California highway when the car’s computer allegedly froze. This caused the electric car to become unresponsive and was stuck going a staggering 83 mph. 

  ABC7 Los Angeles spoke with Javier Rodriguez of Irvine about the incident. Rodriguez said his Model 3’s main screen froze, and all the buttons and switches stopped working while traveling down westbound on the 10 Freeway through Cabazon. He said, moments later, the car’s accelerator was unresponsive while stuck at a high rate of speed. 

  “I noticed that it started to get hot in the car, and there started to be a weird scent coming. 

  “I was nervous that if I were to brake a whole lot that I wouldn’t be able to gain the speed again to keep up with traffic and get around cars. I was nervous somebody was going to slam into me,” Rodriguez said. 

  Rodriguez used his smartphone to capture the incident while the car was stuck at 83 mph. He figured out the brakes did work and made a safe and controlled stop off the highway. 

  

  The Model 3 was towed to a Tesla repair shop, where technicians were able to troubleshoot and fix the problem. They told him a “poor communication from charge port door caused power conversion system to shut off in order to protect onboard components during the drive.” 

  However, Rodriguez isn’t satisfied with Tesla’s answer and demands “more explanation.” He’s worried some safety feature on the vehicle could cause the onboard computer to shut itself down with no warning. 

  Perhaps this is something the National Transportation Safety Board should examine. 

  Tyler Durden
  Wed, 04/13/2022 – 22:00

• India Facing Widespread Blackouts This Summer
  India Facing Widespread Blackouts This Summer

  By John Kemp, senior energy analyst at Reuters

  India faces a persistent shortage of electricity over the next four months as rapid demand growth from air conditioners overwhelms the available generation on the network. 

  India’s grid reported a record load of 200,570 megawatts on July 7, 2021, at the height of last summer, according to the National Load Despatch Centre of the Power System Operation Corporation (POSOCO).

  

  But since the middle of March, the grid has routinely reported maximum loads above 195,000 MW, including a peak of 199,584 MW on April 8 – less than 0.5% below the record.

  

  In the evening, when there is no solar generation available and supplies are even more stretched, peak loads have hit a new record in recent days.

  Exceptionally high loads have arrived far earlier this year, well before the most intense period of summer heat, implying the grid is in trouble.

  In a symptom of the struggle to meet demand, the grid’s frequency has faltered since mid-March, dropping persistently below target, with longer and more severe excursions below the safe operating range.

  Chronic under-frequency is a sign the grid cannot meet the full demand from customers and makes planned load-shedding or unplanned blackouts much more likely.

  India has a frequency target of 50.00 cycles per second (Hertz), with grid controllers tasked with keeping it steady between 49.90 Hz and 50.05 Hz to maintain the network in a safe and reliable condition. Since the middle of March, frequency has averaged just 49.95 Hz and has been below the lower operating threshold more than 23% of the time.

  

  On April 7, the average frequency fell as low as 49.84 Hz and frequency was below the lower threshold for 63% of the day, according to POSOCO data.

  

  Frequency has been below target so often for so long in recent weeks it has sometimes appeared the system is operating according to a much lower informal target.

  

  Low Coal Stocks

  Power producers’ coal inventories remain very low, limiting their ability to run coal-fired units at full capacity to meet demand. Grid-connected generators hold coal stocks equivalent to less than 9 days worth of consumption compared with 12 days at the end of April 2021 and 18 days in 2019.

  Inventories have not really recovered since falling to a critical low of just 4 days at the end of September 2021, when fuel shortages resulted in widespread power cuts.

  

  Rapid growth in electricity demand ensured fuel consumption stayed strong during the traditional winter stock building period while high coal prices also discouraged restocking.

  India’s rail ministry has announced coal from domestic mines and import terminals will be prioritised on the rail network through the end of June to try to increase stocks.

  But the very low level of coal stocks at power plants at the start of the maximum annual demand period indicates power shortages are more or less inevitable over the next few months.

  Air Conditioners

  In contrast to widespread blackouts experienced in October last year, the current problem is the result of strong demand as well as supply problems. India’s grid is under increasing pressure from the rapid growth in load from commercial and residential air conditioners, boosting electricity consumption at all levels of coal stocking.

  Temperatures in northern India have been unusually high for the time of year since mid-March, resulting in a rapid rise in electricity demand. Peak daily loads in the seven days centred on April 8 were more than 9% higher than the same period a year earlier.

  

  In an effort to curb rising electricity demand, the government’s Bureau of Energy Efficiency has mandated a default setting of 24°C for air conditioners sold in India since 2020.

  Users are free to override the default but the government is relying on inertia to establish 24°C as a standard comfort temperature. When average daily temperatures first rose above 24°C this year, for example at Palam in New Delhi on March 13, power demand surged.

  The early arrival of hot weather means there have been 182 cooling degree days so far this year double the long-term seasonal average of 99.

  

  But temperatures are likely to continue rising to a peak at the end of June or beginning of July, pushing electricity demand even higher over the next 2-4 months. 

  Given the grid is already struggling, it is unlikely to be able to serve higher loads between May and August, making load-shedding and other power cuts more or less inevitable during any period of unusually hot weather.

  Tyler Durden
  Wed, 04/13/2022 – 21:40

• Amazon To Hit Sellers With 5% Fuel and Inflation Fee  
  Amazon To Hit Sellers With 5% Fuel and Inflation Fee  

  Amazon is the latest company to implement a plan to combat soaring fuel costs: charge sellers on its giant e-commerce platform an inflation tax. 

  To compensate for rising fuel costs, Amazon will charge sellers a 5% fuel and inflation fee that will go into effect on April 28, according to Bloomberg, citing a person familiar with the matter. 

  The surcharge will apply to sellers who use Amazon’s massive network of fulfillment centers across the US to sell goods. Fulfillment centers handle the logistics of getting goods to consumers’ doorstep but take a massive network of fuel-guzzling planes, trains, trucks, and vans for the e-commerce company to deliver on its two-day promise. 

  

  Amazon is expected to inform sellers about the fee later today. The added fee comes as inflation remains at levels not seen since the early 1980s, and gas prices are at record highs… Russia’s invasion of Ukraine exacerbated inflationary pressures on companies…

  

  We’re sure once sellers are informed about the inflation tax, there will be an angry response from them. Sellers are likely to pass on the tax to consumers.

  As Bloomberg reports, Amazon merchants were already grappling with cost-related fee hikes that took effect in January and averaged 5.2%.

  “Consumers will lose,” said Dan Brownsher, who runs Channel Key, a Las Vegas e-commerce consulting business with more than 50 clients selling products on Amazon.

  “Amazon already raised fees in January, so sellers will have to raise prices.”

  Amazon is far from alone as airlines are raising ticket prices, Uber and Lyft last month added fuel surcharges, and FedEx and UPS have raised prices, mostly though surcharges that vary by package type.

  Tyler Durden
  Wed, 04/13/2022 – 21:20

• Chris Hedges: The Pimps Of War
  Chris Hedges: The Pimps Of War

  Authored by Chris Hedges via Consortium News,

  The same cabal of warmongering pundits, foreign policy specialists and government officials, year after year, debacle after debacle, smugly dodge responsibility for the military fiascos they orchestrate. They are protean, shifting adroitly with the political winds, moving from the Republican Party to the Democratic Party and then back again, mutating from cold warriors to neocons to liberal interventionists. Pseudo intellectuals, they exude a cloying Ivy League snobbery as they sell perpetual fear, perpetual war and a racist worldview, where the lesser breeds of the earth only understand violence.

  

  They are pimps of war, puppets of the Pentagon, a state within a state, and the defense contractors who lavishly fund their think tanks — Project for the New American Century, American Enterprise Institute, Foreign Policy Initiative, Institute for the Study of War, Atlantic Council and Brookings Institute. Like some mutant strain of an antibiotic-resistant bacteria, they cannot be vanquished. It does not matter how wrong they are, how absurd their theories, how many times they lie or denigrate other cultures and societies as uncivilized or how many murderous military interventions go bad. They are immovable props, the parasitic mandarins of power that are vomited up in the dying days of any empire, including that of the U.S., leaping from one self-defeating catastrophe to the next.

  I spent 20 years as a foreign correspondent reporting on the suffering, misery, and murderous rampages these shills for war engineered and funded. My first encounter with them was in Central America. Elliot Abrams — convicted of providing misleading testimony to Congress on the Iran-Contra Affair and later pardoned by President George H.W. Bush so he could return to government to sell us the Iraq War — and Robert Kagan, director of the State Department’s public diplomacy office for Latin America — were propagandists for the brutal military regimes in El Salvador and Guatemala, as well as the rapists and homicidal thugs that made up the rogue Contra forces fighting the Sandinista government in Nicaragua, which they illegally funded. Their job was to discredit our reporting.

  “Like some mutant strain of an antibiotic-resistant bacteria, they cannot be vanquished.”

  They, and their coterie of fellow war lovers, went on to push for the expansion of NATO in Central and Eastern Europe after the fall of the Berlin Wall, violating an agreement not to extend NATO beyond the borders of a unified Germany and recklessly antagonizing Russia. They were and are cheerleaders for the apartheid state of Israel, justifying its war crimes against Palestinians and myopically conflating Israel’s interests with those of the U.S. They advocated for air strikes in Serbia, calling for the U.S. to “take out” Slobodan Milosevic. They were the authors of the policy to invade Afghanistan, Iraq, Syria and Libya. Robert Kagan and William Kristol, with their typical cluelessness, wrote in April 2002 that “the road that leads to real security and peace” is “the road that runs through Baghdad.”

  We saw how that worked out. That road led to the dissolution of Iraq, the destruction of its civilian infrastructure, including the obliteration of 18 of 20 electricity-generating plants and nearly all the water-pumping and sanitation systems during a 43-day period when 90,000 tons of bombs were rained down on the country, the rise of radical jihadist groups throughout the region, and failed states.

  The war in Iraq, along with the humiliating defeat in Afghanistan, shredded the illusion of U.S. military and global hegemony. It also inflicted on Iraqis, who had nothing to do with the attacks of 9/11, the widespread killing of civilians, the torture and sexual humiliation of Iraqi prisoners, and the ascendancy of Iran as the preeminent power in the region.

  Push for War & Overthrows

  They continue to call for a war with Iran, with Fred Kagan stating that “there is nothing we can do short of attacking to force Iran to give up its nuclear weapons.” They pushed for the overthrow of President Nicholas Maduro, after trying to do the same to Hugo Chavez, in Venezuela. They have targeted Daniel Ortega, their old nemesis in Nicaragua.

  They embrace a purblind nationalism that prohibits them from seeing the world from any perspective other than their own. They know nothing about the machinery of war, its consequences, or its inevitable blowback. They know nothing about the peoples and cultures they target for violent regeneration. They believe in their divine right to impose their “values” on others by force. Fiasco after fiasco. Now they are stoking a war with Russia.

  “The nationalist is by definition an ignoramus,” Yugoslav writer Danilo Kiš observed.

  “Nationalism is the line of least resistance, the easy way. The nationalist is untroubled, he knows or thinks he knows what his values are, his, that’s to say national, that’s to say the values of the nation he belongs to, ethical and political; he is not interested in others, they are no concern of his, hell — it’s other people (other nations, another tribe). They don’t even need investigating. The nationalist sees other people in his own images — as nationalists.”

  The Biden administration is filled with these ignoramuses, including Joe Biden. Victoria Nuland, the wife of Robert Kagan, serves as Biden’s undersecretary of state for political affairs. Antony Blinken is secretary of state. Jake Sullivan is national security adviser.

  

  They come from this cabal of moral and intellectual trolls that includes Kimberly Kagan, the wife of Fred Kagan, who founded The Institute for the Study of War, William Kristol, Max Boot, John Podhoretz, Gary Schmitt, Richard Perle, Douglas Feith, David Frum and others. Many were once staunch Republicans or, like Nuland, served in Republican and Democratic administrations. Nuland was the principal deputy foreign policy adviser to Vice President Dick Cheney.

  They are united by the demand for larger and larger defense budgets and an ever-expanding military. Julian Benda called these courtiers to power “the self-made barbarians of the intelligentsia.”

  They once railed against liberal weakness and appeasement. But they swiftly migrated to the Democratic Party rather than support Donald Trump, who showed no desire to start a conflict with Russia and who called the invasion of Iraq a “big, fat mistake.” Besides, as they correctly pointed out, Hillary Clinton was a fellow neocon. And liberals wonder why nearly half the electorate, who revile these arrogant unelected power brokers, as they should, voted for Trump.

  

  These ideologues did not see the corpses of their victims. I did. Including children. Every dead body I stood over in Guatemala, El Salvador, Nicaragua, Gaza, Iraq, Sudan, Yemen or Kosovo, month after month, year after year, exposed their moral bankruptcy, their intellectual dishonesty and their sick bloodlust. 

  They did not serve in the military. Their children do not serve in the military. But they eagerly ship young American men and women off to fight and die for their self-delusional dreams of empire and American hegemony. Or, as in Ukraine, they provide hundreds of millions of dollars in weaponry and logistical support to sustain long and bloody proxy wars.

  Historical time stopped for them with the end of World War II. The overthrow of democratically elected governments by the U.S. during the Cold War in Indonesia, Guatemala, the Congo, Iran and Chile (where the C.I.A. oversaw the assassination of the commander-in-chief of the army, General René Schneider, and President Salvador Allende); the Bay of Pigs; the atrocities and war crimes that defined the wars in Vietnam, Cambodia and Laos; even the disasters they manufactured in the Middle East, have disappeared into the black hole of their collective historical amnesia.

  “Julian Benda called these courtiers to power ‘the self-made barbarians of the intelligentsia.’ ” 

  American global domination, they claim, is benign, a force for good, “benevolent hegemony.” The world, Charles Krauthammer insisted, welcomes “our power.” All enemies, from Saddam Hussein to Vladimir Putin, are the new Hitler. All U.S. interventions are a fight for freedom that make the world a safer place. All refusals to bomb and occupy another country are a 1938 Munich moment, a pathetic retreat from confronting evil by the new Neville Chamberlain. We do have enemies abroad. But our most dangerous enemy is within.

  The warmongers build a campaign against a country such as Iraq or Russia and then wait for a crisis — they call it the next Pearl Harbor — to justify the unjustifiable.

  In 1998, William Kristol and Robert Kagan, along with a dozen other prominent neoconservatives, wrote an open letter to President Bill Clinton denouncing his policy of containment of Iraq as a failure and demanding that he go to war to overthrow Saddam Hussein. To continue the “course of weakness and drift,” they warned, was to “put our interests and our future at risk.”

  

  Huge majorities in Congress, Republican and Democrat, rushed to pass the Iraq Liberation Act. Few Democrats or Republicans dared be seen as soft on national security. The act stated that the United States government would work to “remove the regime headed by Saddam Hussein” and authorized $99 million towards that goal, some of it being used to fund Ahmed Chalabi’s Iraqi National Congress that would become instrumental in disseminating the fabrications and lies used to justify the Iraq war during the administration of George W. Bush.

  The attacks of 9/11 gave the war party its opening, first with Afghanistan, then Iraq. Krauthammer, who knew nothing about the Muslim world, wrote that:

  “the way to tame the Arab street is not with appeasement and sweet sensitivity but with raw power and victory…The elementary truth that seems to elude the experts again and again…is that power is its own reward. Victory changes everything, psychologically above all. The psychology in the [Middle East] is now one of fear and deep respect for American power. Now is the time to use it.”

  Removing Saddam Hussein from power, Kristol crowed, would “transform the political landscape of the Middle East.”

  It did, of course, but not in ways that benefited the U.S.

  “Historical time stopped for them
  with the end of World War II.”

  They lust for apocalyptic global war. Fred Kagan, the brother of Robert, a military historian, wrote in 1999 that “America must be able to fight Iraq and North Korea, and also be able to fight genocide in the Balkans and elsewhere without compromising its ability to fight two major regional conflicts. And it must be able to contemplate war with China or Russia some considerable (but not infinite) time from now [author’s emphasis].”

  They believe violence magically solves all disputes, even the Israeli-Palestinian morass. In a bizarre interview immediately after 9/11, Donald Kagan, the Yale classicist and rightwing ideologue who was the father of Robert and Fred, called, along with his son Fred, for the deployment of U.S. troops in Gaza so we could “take the war to these people.”

  They have long demanded the stationing of NATO troops in Ukraine, with Robert Kagan saying that “we need to not worry that the problem is our encirclement rather than Russian ambitions.”  His wife, Victoria Nuland, was outed in a leaked phone conversation in 2014 with the U.S. ambassador to Ukraine, Geoffrey Pyatt, disparaging the EU and plotting to remove the lawfully elected President Viktor Yanukovych and install compliant Ukrainian politicians in power, most of whom did eventually take power.

  They lobbied for U.S. troops to be sent to Syria to assist “moderate” rebels seeking to overthrow Basha al-Assad. Instead, the intervention spawned the Caliphate. The U.S. ended up bombing the very forces they had armed, becoming Assad’s de facto air force.

  The Russian invasion of Ukraine, like the attacks of 9/11, is a self-fulfilling prophecy. Putin, like everyone else they target, only understands force. We can, they assure us, militarily bend Russia to our will.

  

  “It is true that acting firmly in 2008 or 2014 would have meant risking conflict,” Robert Kagan wrote in the latest issue of Foreign Affairs of Ukraine, lamenting our refusal to militarily confront Russia earlier. He wrote:

  “But Washington is risking conflict now; Russia’s ambitions have created an inherently dangerous situation. It is better for the United States to risk confrontation with belligerent powers when they are in the early stages of ambition and expansion, not after they have already consolidated substantial gains. Russia may possess a fearful nuclear arsenal, but the risk of Moscow using it is not higher now than it would have been in 2008 or 2014, if the West had intervened then. And it has always been extraordinarily small: Putin was never going to obtain his objectives by destroying himself and his country, along with much of the rest of the world.”

  In short, don’t worry about going to war with Russia, Putin won’t use the bomb.

  I do not know if these people are stupid or cynical or both. They are lavishly funded by the war industry. They are never dropped from the networks for their repeated idiocy. They rotate in and out of power, parked in places like The Council on Foreign Relations or The Brookings Institute, before being called back into government. They are as welcome in the Obama or Biden White House as the Bush White House.

  The Cold War, for them, never ended. The world remains binary, us and them, good and evil. They are never held accountable. When one military intervention goes up in flames, they are ready to promote the next. These Dr. Strangeloves, if we don’t stop them, will terminate life as we know it on the planet.

  *  *  *

  Chris Hedges is a Pulitzer Prize–winning journalist who was a foreign correspondent for 15 years for The New York Times, where he served as the Middle East bureau chief and Balkan bureau chief for the paper. He previously worked overseas for The Dallas Morning News, The Christian Science Monitor and NPR.  He is the host of show The Chris Hedges Report.

  Author’s Note to Readers: There is now no way left for me to continue to write a weekly column for ScheerPost and produce my weekly television show without your help. The walls are closing in, with startling rapidity, on independent journalism, with the elites, including the Democratic Party elites, clamoring for more and more censorship. Bob Scheer, who runs ScheerPost on a shoestring budget, and I will not waiver in our commitment to independent and honest journalism, and we will never put ScheerPost behind a paywall, charge a subscription for it, sell your data or accept advertising. Please, if you can, sign up at chrishedges.substack.com so I can continue to post my Monday column on ScheerPost and produce my weekly television show, The Chris Hedges Report.

  This column is from Scheerpost, for which Chris Hedges writes a regular column. Click here to sign up for email alerts.

  The views expressed are solely those of the author and may or may not reflect those of Consortium News.

  Tyler Durden
  Wed, 04/13/2022 – 21:00

• Watch: Giant Cranes Begin Lifting Containers Off Massive Ship Stuck In Chesapeake Bay
  Watch: Giant Cranes Begin Lifting Containers Off Massive Ship Stuck In Chesapeake Bay

  Shipping containers started coming off the massive container ship stuck in the Chesapeake Bay as another refloat attempt could come later this month. 

  The operation began on Saturday, nearly a month since the Ever Forward, a 1,100-foot container ship with 5,000 containers, ran aground in 24 feet of water and needed about 42 feet of draft. 

  According to the maritime news website gCaptain, about 500 of the 5,000 containers, or about 10%, will be offloaded ahead of the next refloating attempt. 

  Giant cranes on either side of the vessel have been offloading containers onto two barges. Port of Baltimore Executive Director William Doyle said the Seagirt terminal received 43 containers on Sunday. About 100 containers have been removed since Tuesday, but the operation is hazardous and weather dependent. 

  A Coast Guard spokesperson told gCaptain that the next refloating attempt could be as early as next week — “coinciding with the next full moon.” 

  Evergreen Marine, the owner of Ever Forward, declared a “General Average” earlier this month after multiple refloating attempts failed. This means some of the costs to refloat the vessel will be transferred to cargo owners. 

  There are dangers in unloading containers as risks of unbalancing and damaging the ship are possible. There are concerns that stress on the hull buried in more than 20 feet of mud could result in a fuel leak or structural damage.  

  Here’s footage of cranes picking up containers from the vessel and placing them on barges.  

  

  

  

  Chesapeake Bay Media provides a video of the unloading. 

  So what happens when removing 10% of containers doesn’t refloat the vessel? 

  Tyler Durden
  Wed, 04/13/2022 – 20:40

• Bienvenidos! First Texas Bus Full Of Migrants Dropped Off In Washington DC
  Bienvenidos! First Texas Bus Full Of Migrants Dropped Off In Washington DC

  A special delivery from Texas Gov. Greg Abbott arrived in Washington D.C. Wednesday morning, as a bus full of dozens of illegal immigrants stopped just blocks away from the US Capitol building at approximately 8 a.m. local time.

  

  The bus was sent following an announcement by Abbott last week that the Texas Division of Emergency Management (TDEM) would provide charter buses or flights to transport illegal immigrants released into the US by the feds, to D.C.

  

  According to Fox News, individuals disembarked one-by-one, except for families who exited together. Donning wristbands which were cut off before their release, the migrants checked in with officials.

  Texas buses filled with migrants arrived in Washington DC. pic.twitter.com/T1yF8nnt2X

  — Real Mac Report (@RealMacReport) April 13, 2022

   According to TDEM, Abbott’s plan is already working. The agency told Fox News on Monday that many of the communities that originally reached out for support – from the Rio Grande Valley to Terrell County – say the federal government stopped dropping immigrants in their towns since Abbott’s announcement on April 6. 

  Some had questioned whether Abbott’s plan to bus migrants was genuine. The White House dismissed it as a “publicity stunt.” Even Texas state Rep. Matt Schaefer, a Republican, called it a “gimmick.” –Fox News

  The Epoch Times reported last week that Abbott’s order came in response to the lifting of Title 42 by the Biden administration earlier this month – a CDC order that was invoked in March 2020 under President Donald Trump to minimize the spread of COVID-19 by ensuring that only essential travel occurred at U.S. borders.

  It directed that illegal immigrants could be quickly expelled back into Mexico as a pandemic precaution, rather than be processed under Title 8 immigration law, which is a much more protracted process inside the United States.

  As the Biden administration prepares to drop the measure on May 23, Border Patrol agents and local officials along the border are bracing for an even greater influx of illegal immigrants.

  According to TDEM, buses were dispatched over the weekend to border communities, where officials coordinated to identify the migrants.

  “Texans demand and deserve an aggressive, comprehensive strategy to secure our border—not President Biden’s lackluster leadership,” Abbott said in a statement. “As the federal government continues to roll back commonsense policies that once kept our communities safe, our local law enforcement has stepped up to protect Texans from dangerous criminals, deadly drugs, and illegal contraband flooding into the Lone Star State.”

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  Tyler Durden
  Wed, 04/13/2022 – 20:20

• Russia Confirms Black Sea Flagship On Fire, "Seriously Damaged" Off Odessa After Reported Missile Strike
  Russia Confirms Black Sea Flagship On Fire, “Seriously Damaged” Off Odessa After Reported Missile Strike

  Update(2011ET): Russia has belatedly confirmed that its Moskva warship has suffered significant damage after Ukrainian officials said its forces scored direct missile hits on the ship off Odessa’s coast. 

  However, Russian state RIA is seeking to counter the Ukrainian narrative, saying that the Moskva has been “seriously damaged” due to a fire that broke out on board which detonated ammunition. But there weren’t further details provided, resulting in an emerging consensus among Western observers that likely the ship was indeed struck. The Ukrainians said earlier they struck the vessel with two Neptune anti-ship cruise missiles…

  Ukraine reportedly hit the Moskva Project 1164 missile cruiser with two Neptune Anti-Ship Missiles. The Neptune is capable of reaching a target at distance of up to 300 km. It has ultra-high viewing angles & is able to detect/capture the target at a distance of up to 50 km. pic.twitter.com/DDZkIrJ51S

  — Global: MilitaryInfo (@Global_Mil_Info) April 14, 2022

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  Thus like in many other cases in this grinding war, two contrary narratives have quickly emerged…

  #UPDATE A Russian warship in the Black Sea was “seriously damaged” by an ammunition explosion, Russian state media report.

  “As a result of a fire, ammunition detonated on the Moskva missile cruiser. The ship was seriously damaged.” The cause of the fire is still being determined pic.twitter.com/79pzx4ES0y

  — AFP News Agency (@AFP) April 14, 2022

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  But while there were reports that over 500 Russian crewmembers could be in immediate danger of sinking, RIA is reporting, “”The crew was completely evacuated. The reasons for the incident are being established”…leaving things still unclear.

  The incident suggests things are likely to heat up, also as the US administration has just vowed to ramp up its weapons shipments to Kiev.

  Losing the Moskva (if confirmed) isn’t just tactically significant it’s strategically significant

  And could be a big sign things are about to heat up https://t.co/fuhhk1NxhW

  — Jack Posobiec 🇺🇸 (@JackPosobiec) April 14, 2022

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  Prior footage of a Neptune in action:

  * * *

  Update(1820ET): Into the late and overnight hours local time Ukrainian sources are claiming a Russian warship is sinking off the Odessa coast after being struck by Ukrainian missiles. Regional media has cited Ukrainian military officials in Odessa, saying: 

  The Ukrainian military has struck a Russian naval cruiser with two missiles, causing “severe damage” to the warship, an official said late Wednesday.

  Maksym Marchenko, head of the Odessa Regional Military Administration, said on Telegram that the Moskva, the flagship of the Russian Black Sea Fleet, was hit with two Neptune anti-ship missiles.

  There’s reportedly over 500 Russian crew members on board, however the Russian military has not confirmed the incident, nor was their initial confirmation out of high level Ukrainian defense Ministry officials. 

  There continues to be Claims by Ukrainian Regional/Military Officials that the Slava-Class Cruiser “Moskva” Flag-Ship of the Russian Black Sea’s Fleet was Struck by 2 Ukrainian Navy fired Neptune Anti-Ship Missiles off the Coast of Odessa and is Actively Sinking with 500+ aboard. pic.twitter.com/uj8PtHUquE

  — OSINTdefender (@sentdefender) April 13, 2022

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  Earlier in an afternoon press briefing, Pentagon spokesman John Kirby said the US believes based on intelligence that Russian troops are suffering “low morale” after immense battlefield losses. 

  Continued indications among #Russia forces of low morale and disenchantment and “their leaders are also frustrated,” says @PentagonPressSec. pic.twitter.com/3xBZ8vh7yA

  — Steve Herman (@W7VOA) April 13, 2022

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  * * *

  Update(1417ET): The White House is moving to significantly expand its intelligence sharing with Ukraine, The Wall Street Journal is reporting based on admin officials. 

  “The Biden administration is moving to significantly expand the intelligence it is providing to Ukraine’s forces so they can target Moscow’s military units in Russian-occupied Donbas and Crimea and potentially take back territory, U.S. officials said,” the report says.

  Further it comes as Biden has said the Pentagon will step up its weapons flow to Kiev. This was revealed following a phone call with Zelensky on Wednesday, where Biden said he informed his Ukrainian counterpart he’s authorized an additional $800 million in weapons, ammunition, and other security assistance to Ukraine, according to the official readout.

  Crucially, the transfer of helicopters was named as part of the new assistance package. Some of these are weapons systems the Pentagon has never given Ukraine before. The section of the readout indicates as follows:

  These new capabilities include artillery systems, artillery rounds, and armored personnel carriers. I have also approved the transfer of additional helicopters. In addition, we continue to facilitate the transfer of significant capabilities from our Allies and partners around the world. 
   
  The steady supply of weapons the United States and its Allies and partners have provided to Ukraine has been critical in sustaining its fight against the Russian invasion. It has helped ensure that Putin failed in his initial war aims to conquer and control Ukraine. We cannot rest now. As I assured President Zelenskyy, the American people will continue to stand with the brave Ukrainian people in their fight for freedom.

  It was previously reported that these would likely be Mi-17 helicopters.

  The Biden administration is weighing sending Ukraine Mi-17 transport helicopters that can also be used in an attack role as part of a new $750 million military aid package, U.S. and congressional aides say

  — Lucas Tomlinson (@LucasFoxNews) April 12, 2022

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  The WSJ report separately comments that the new intelligence guidance has been issued as Russian forces appear poised for a major new assault deeper into the Donbas in the coming days.

  Meanwhile, and hugely alarming, the Kremlin has put out the following statement saying that all of this is a recipe for expanding the war:

  “We see attempts of sabotage and strikes by Ukrainian troops on objects on the territory of the Russian Federation,” said Russian Ministry of Defense spokesperson Maj. Gen. Igor Konashenkov, in a statement. “If such cases continue, the Armed Forces of the Russian Federation will strike at decision-making centers, including in Kyiv, from which the Russian army has thus far refrained.”

  

  * * *

  At a moment the Pentagon has vowed to “speed up” weapons deliveries to Ukraine forces, and after Slovakia announced early this week it is in discussion with NATO allies to provide Kiev with MiG-29 fighter jets, the Kremlin has repeated its warning that any weapons shipments entering the country will be viewed as “legitimate military targets”. 

  The renewed warning was issued Wednesday by Russia’s Deputy Foreign Minister Sergei Ryabkov, who told TASS news agency that the military stands ready to attack any US or NATO vehicles caught transporting weapons into the conflict. 

  “We are warning that US-NATO weapons transports across Ukrainian territory will be considered by us as legal military targets,” said Ryabkov, after last month the Kremlin issued a similar warning. But this time the language has been narrowed to specifically put the US and NATO on notice, whereas previously this was left somewhat ambiguous. 

  

  He warned further that these attempts to inflict damage on Russian forces will be “harshly suppressed”, explaining that…

  “We are making the Americans and other Westerners understand that attempts to slow down our special operation, to inflict maximum damage on Russian contingents and formations of the DPR and LPR (Donetsk and Luhansk People’s republics) will be harshly suppressed.”

  Ryabkov’s words come days after the Kremlin said ship-fired cruise missiles destroyed S-300 anti-air systems which had been provided by a European country.

  “Defense Ministry spokesman Major General Igor Konashenkov said on Monday Russian Kalibr missiles destroyed on Sunday four S-300 launchers concealed in a hangar on the outskirts of the central-eastern Ukrainian city of Dnipro, hitting 25 Ukrainian soldiers in the attack,” it was reported Monday based on state sources.

  However, Slovakia – which had recently confirmed sending an S-300 system to Kiev – as well as Ukraine itself denied the Russian claims. Given the apparent delivery of such major systems to Ukraine, it’s likely other European and NATO countries will join with sending heavier and heavier weaponry, also amid reports of Soviet-era tank transfers.

  Meanwhile, Reuters reports that the Department of Defense is looking to further ramp up its own shipments to Kiev: “The Pentagon’s Defense Security Cooperation Administration is having weekly meetings of its European Crisis Management Team to review specific requests related to Ukraine,” writes Reuters. 

  And the report notes things are about t speed up: “To speed up U.S. government approval for sales and transfers of arms produced by American defense contractors, the Pentagon has re-established a team to respond to the increased demand,” according to Reuters.

  Tyler Durden
  Wed, 04/13/2022 – 20:11

• BlackRock Dismisses Three Executives Who Planned To Quit In Coordinated Fashion
  BlackRock Dismisses Three Executives Who Planned To Quit In Coordinated Fashion

  BlackRock reportedly has dismissed three private equity executives that had planned to leave the company in a “coordinated fashion”, according to a leaked internal memo reported on by Bloomberg this week.

  The trio, who were were managing directors in the company’s secondaries business, had coordinated an effort to leave the company in unison.

  Perhaps fearing a public relations crisis a la that of the Goldman junior banker fiasco from years ago, BlackRock decided to get ahead of the news and announced to its own employees that it had dismissed the three workers instead. 

  The employees, Konnin Tam, Steve Lessar and Veena Isaac, helped manage a $3 billion strategy, the Bloomberg writeup notes. The three are leaving to join Apollo Global Management Inc., according to Yahoo. 

  

  According to that report, the workers’ lawyers said they had a “desire to work cooperatively during the transition” and that they “also told BlackRock that they would depart immediately or before the end of a 90-day notice period if that’s what the company preferred, according to two people who shared the contents of a resignation letter.”

  An internal memo to Blackrock employees said: “The action we took reflects how seriously we take our commitment to putting the interests of our clients first and how the actions of these individuals fell short of what we expect of our employees.”

  Edwin Conway, global head of BlackRock Alternative Investors, and Russell Steenberg, global head of BlackRock Private Equity Partners, said in the memo: “BlackRock made the decision to terminate all three employees after learning of their intention to depart the firm in a coordinated fashion.”

  The move seems somewhat bizarre to us. Why would the company fire the employees who planned on quitting anyway? Now it’s far more likely that BlackRock could be on the hook for paying the fired employees’ benefits.

  We won’t be surprised if there’s “another shoe to drop” in this story. We’ll keep our eyes peeled…

  Tyler Durden
  Wed, 04/13/2022 – 20:00

• Grand Rapids Police Release Video Of Officer Fatally Shooting Unarmed Black Man
  Grand Rapids Police Release Video Of Officer Fatally Shooting Unarmed Black Man

  Hours after the NYPD and Mayor Eric Adams celebrated the capture of Frank James, the suspected shooter in Tuesday’s brutal mass shooting (which, thankfully, hasn’t resulted in any deaths, although a pregnant woman and a young child are among the victims), police in Grand Rapids, Michigan have just released footage of a police officer shooting a 26-year-old unarmed black man.

  

  According to an NYT report, while the victim in the shooting was unarmed, video footage appeared to show the two men wrestling for control of the officer’s taser before the officer – who was not named – shot the young man, 26-year-old Patrick Lyoya, in the head.

  The shooting has been a major local story even before the release of the footage, with the NYT saying it exposed “longstanding tensions in Grand Rapids” (as these types of officer-involved shootings have a habit of doing).

  In a city of about 200,000 people, 18% of Grand Rapids residents are Black. Activists aired their frustration and grief on Tuesday night during a City Commission meeting, speaking for hours about what they described as years of inaction and abuse by police.

  The investigation into the officer’s actions was ongoing, officials said on Wednesday, and no charging decision had been made. Chief Eric Winstrom of the Grand Rapids police said he was not aware of any weapons other than the officer’s gun and Taser being found at the scene. Police body camera video shows the officer telling Mr. Lyoya that he is pulling him over because his license plates do not match his car.

  The victim’s family has already retained Ben Crump, the same lawyer who represent the family of George Floyd, to represent them in what’s expected to be legal action against the city.

  Officials said that the police officer who fired the fatal shot joined the department in 2015. Lyoya immigrated to the US from the Democratic Republic of Congo in 2014 and had lived in Grand Rapids for about five years.

  “The video clearly shows that this was an unnecessary, excessive and fatal use of force against an unarmed Black man who was confused by the encounter and terrified for his life,” Mr. Crump said. He called for the officer to be fired and prosecuted.

  Already, it seems tensions are simmering in Grand Rapids. Gov. Gretchen Whitmer has expressed sympathy for the family and called for any protests to be peaceful. As for whether there will be any protests – local or national – that remains to be seen.

  But the real question is: after the events of this past week, are the police now ‘the bad guys’ again?

  Tyler Durden
  Wed, 04/13/2022 – 19:40

• Meta Paid $26.8 Million For Mark Zuckerberg's Security In 2021
  Meta Paid $26.8 Million For Mark Zuckerberg’s Security In 2021

  Mark Zuckerberg’s security is soon going to have its own line item in the company’s financial statements. That’s because it cost Meta nearly $27 million last year just to keep the company’s founder and CEO safe, according to a new report from Protocol.

  $26.8 million was spent on Zuckerberg, including on protecting the CEO’s family and houses. The figure includes $10 million that was spent for his personal security allowance and $1.6 million that was spent for his private jet. 

  Zuck’s tab for security this year was about 6% higher from 2020, when the company spent $23.4 million on the CEO. We guess now, the company doesn’t only have to protect him in the real world, but in the metaverse too?

  

  You will find more infographics at Statista

  Zuckerberg is “synonymous” with the company, Meta wrote in its filing, marking its reasoning for spending so much on his well being. The filing called him one of the “most recognized” executives in the world and said that “any negative sentiment regarding the company goes back to him”.

  The filing also cited Meta’s “continued exposure to global media, legislative and regulatory attention.”

  

  Starting next year, the company will also be paying for a private jet that is owned by Zuckerberg, the report says. 

  “For travel by Mr. Zuckerberg on the aircraft owned by Mr. Zuckerberg, we pay an amount commensurate with market rates,” the filing said. 

  Tyler Durden
  Wed, 04/13/2022 – 19:20

• "Nice Narrative" But No: Why One Strategist Thinks Zoltan Pozsar's "Bretton Woods 3" Is Never Going To Happen
  “Nice Narrative” But No: Why One Strategist Thinks Zoltan Pozsar’s “Bretton Woods 3” Is Never Going To Happen

  Ever since Zoltan Pozsar started echoing Zero Hedge circa 2010, and in note after feverishly-drafted note, the former NY Fed repo guru has been writing about a coming monetary revolution in which commodity-backed currencies such as the yuan become dominant and gradually displace the world’s reserve currency – the US Dollar – which slowly fades into irrelevancy in a world where commodities are the fulcrum asset and where paper wealth is increasingly meaningless, there have been three reactions: i) those who have no idea what Zoltan is writing about (that would be about 98%), ii) those who agree wholeheartedly and believe that the USD should be dethroned as a reserve currency yesterday, and iii) those who are just a little bit “displeased” with all the attention the strategist (who has correctly called every major crisis and turning point in markets in the past decade) is getting and are starting to lash out at his stream of consciousness.

  Rabobank’s Michael Every, himself a geopolitical status quo skeptic yet clearly misaligned with Zoltan as to what happens next (and in reality a believer that the broken system we have now will be the broken system we have for a long, long time to come), is in group three, and following a handful of “subtweet” shots across the Zoltan bow (which have barely registered in the financial media, especially Bloomberg, which Every continuously mocks yet reads religiously) the Rabobank strategist has (bravely) penned the closest thing to a Pozsar rebuttal we have seen. 

  Is he right, or is he just unhappy with how much attention Pozsar is getting? We leave it to readers to decide, and republish his latest note, “Why “Bretton Woods 3″ Won’t Work” in its entirety below.

  Why ‘Bretton Woods 3’ Won’t Work

  Nice narrative: but it’s just ‘mercantilism’

  Summary

  • Sanctions on Russia are seen as accelerating a dramatic shift towards a new global commodity-focused ‘Bretton Woods 3’ architecture

  • However, this is actually a very old economic argument: mercantilism

  • History, logic, trade data, and economic geography all show the US can do well in that kind of realpolitik environment

  • By contrast, the opportunity to shift global trade flows away from USD to others is limited: fundamentally, neither CNY nor commodity currencies are set up to rival USD globally

  • The USD will therefore retain its global role despite the ‘Bretton Woods 3’ hype

  Many bad sequels

  The world is experiencing dramatic changes in its security, political, economic, and financial architecture. Indeed, alongside war in Ukraine we see headlines about ‘Cold War 2’, ‘Bretton Woods 3’, and even World War 3.

  We will not comment on the risks of World War 3, as flagged by Russians such as Karaganov, given it is impossible to trade for.

  However, China and Russia are openly trying to build a new world order, which we argued would happen back in 2017: this report focuses on the viability of a global FX architecture remake to a so-called ‘Bretton Woods 3’ (BW3).

  We argue that:

  • BW3 has an appealing narrative, and we agree with a lot of its core arguments. However, it is not a new concept at all, but an old one – mercantilism.

  • That’s an environment that still suits the US and allies.

  • As such, we can look at history, logic, trade data, and geoeconomics to see that BW3 will not work as sold.

  • We may see some USD trade shift to CNY via offset or barter. However, the most this would cover is just 3.3% of global trade, vs. CNY’s current 2.6% share of global FX reserves. The more likely shift is just 1% of global trade.

  • With much of this being offset, the impact on $6.6trn daily global FX markets would be negligible.

  • Overall, the USD will retain its global role despite the BW3 claim of a new architecture ahead.

  The pitch

  Let’s first run through the key arguments made for B3W:

  • (i) High inflation and supply-chain logjams mean Western central banks and economies can no longer rely on quantitative easing (QE) as a policy crutch: you cannot print commodities. More QE now just means more inflation and currency debasement.

  • (ii) States instead need control of key commodities and supply chains, including maritime logistics, with military might required to secure them.

  • (iii) Sanctions on Russia and possible secondary sanctions on others have “weaponised” the USD, euro (EUR), and yen (JPY). Fewer countries will want to hold such reserves if they can be frozen or appropriated, as happened with Russia and Afghanistan. These trends are accelerating a global shift to alternative FX, payment systems, and trading patterns.

  • (iv) We will see a new commodity- and supply-chain based FX architecture replace the USD-centric system: Russia just called for BRICs countries to create exactly such a new FX system.

  • (v) Commodity currencies and China’s renminbi (CNY) are seen as major winners in this new order.

  A good narrative isn’t enough

  Markets like a good narrative.

  BW3 has one given: high inflation and commodity prices; central bank impotence; concerns over the imminent withdraw of US QE – and fears over what having to restart it would imply; and talk of geopolitical and geoeconomic realignments and fracturing.

  Moreover, BW3 does not require the audience to suspend much disbelief. Relative US political, economic, financial, and military muscle has declined in recent decades.

  Even US soft power is fading: and China’s movie box-office has been larger than the US since 2018, dominated by local films. The famous ‘Sunset Boulevard’ line from a fading movie star is, “I Am Big. It’s the Pictures That Got Small.” The US is still big, but others are no longer as relatively small as they were.

  However, BW3 is not new. Indeed, it takes us almost full circle in time and FX structure (Figure1).

  

  In short:

  The post-WW2 original Bretton Woods system had USD tied to gold in a divided Cold War world economy with stringent capital controls.

  • That lasted 26 years before collapsing due to the Triffin Paradox (which we shall return to later) and the shift to fiat USD in the 1970s.

  • Then we saw evolution to the recycling of so-called ‘petrodollars’ as oil prices surged following the 1973 Yom Kippur War.

  • The end of the Cold War saw globalisation and higher USD capital flows into emerging markets… and the resulting Mexican (1995) and then Asian Crisis (1997-98)

  • That led to the de facto BW2 of USD FX reserve hoarding and recycling, as emerging markets opted to run large current account surpluses rather than deficits.

  • The 2000’s US-steered hyper-globalisation saw a boom in funding in the five-decade old Eurodollar, via both bank and shadow-bank channels.

  • The Global Financial Crisis (GFC) and subsequent slump in Western growth saw a long-run shift to a reliance on central bank QE to try to stabilise markets and economies.

  • That ‘new normal’ approach was brought to an end by populist discontent with the inequality it drives, and the fiscal response to Covid: yet Covid also showed reflationary fiscal policies are not possible without national control of commodities and supply chains.

  • War in Ukraine is pushing us into Cold War 2 – and non-USD ‘reserve currencies’ backed by commodities.

  In short, BW3 is not forward, but backwards looking. We have seen many elements of it before. Yet past attempts at building BW3 frameworks created enormous problems!

  The post-war Bretton Woods timeframe left excludes it, but one could look to the fragmentation of the global monetary order and trading system in the 1930s, for one key –and worrying— parallel: however, that saw the end of the gold standard, not a move towards one.

  Indeed, we have long taken a historical and structural view of markets that leads us to agree on the BW3 view of the ineffectiveness of QE; the geopolitical importance of logistics; the necessity to control supply chains and trade to maintain currency power; and of the ongoing fragmentation of the global economy. We even linked this all to FX structures back in 2015. Furthermore, we agree we are heading not just to Cold War but to global Great Power struggles in which trade and currency will play key roles.

  Yet taking this kind of view, it becomes clear that BW3 will still work more in the USD’s favor than for any rival currency being touted.

  We will now look at the historical, logical, structural, trade- data, and geoeconomic reasons to briefly summarise Why B3W Won’t Work (WBW3WW).

  WBW3WW 1: history

  The global economy has seen commodity currency foundations in the past. The most obvious was the gold standard on and off 1815-1971, and in its purest form from 1815-1913. There are many key lessons we can draw from this period for BW3 proponents.

  The likes of Argentina saw more FX stability under it that is has since (Figure 2): and Argentina is still a commodity producer today that might be looking at BW3.

  

  However, inflation was only well contained on average by regular deflation (Figure 3). It is unclear that a modern economy would want to see such start-stop price swings.

  

  Moreover, a commodity standard restricts excessive growth of credit by either the government or the banking sector. While a positive case for both can be made, would any economy want to embrace that hairshirt approach?

  On the government side, the current vogue is for more, not less state spending in the name of national security: and for more, not less social welfare to narrow income gaps. Without the latter, the gold standard did not stop the many attempted revolutions of 1848 or 1870 in Europe: rather it encouraged them. One could expect the same under BW3.

  Russia, which runs a conservative fiscal policy, might be prepared to embrace that approach. However, China cannot. On the private side, China has seen an explosion of debt since 2008: tying itself to an FX commodity standard would mean implosive deflation in Chinese asset prices if new lending was capped. Moreover, China’s total public sector debt, including local governments, is already that of a European state, and the IMF says its augmented fiscal deficit was a staggering -16.5% of GDP in 2021.

  

  Geopolitically, the gold standard was zero-sum. With a (mostly) fixed stock of gold, states either gained the metal through trade, which was also zero-sum, or war. Free trade was tried at British behest, but Europe quickly learned the secret of British success was actually mercantilism and imperialism. It followed suite, with a lag – and so did WW1 (Figure 5). Indeed, ‘Debt: The First 5,000 Years’ (Graeber, 2011) echoes Polanyi (1944) in arguing past historical periods of exogenous money, such as gold, saw more war
  compared to endogenous, fiat/debt-based periods of expansion.

  

  Of course, when debt-based expansions end similar problems can arise, as we see today: yet embracing a global commodity currency standard would guarantee that outcome from the outset.

  WBW3WW 2: logic

  The four logical functions a global FX reserve currency must meet are: (i) store of value; (ii) method of accounting; (iii) means of exchange; and (iv) overcoming the Triffin Paradox. All of these still favor USD over any rivals.

  Store of value

  Commodity currencies are either pegged to the USD, in which commodities are priced, or are highly volatile (Figure 6). Unless global commodities are now going to permanently lose that volatility, and volatility is actually increasing in many of them, then commodity currencies will not lose theirs either.

  

  No rival global currencies offer the trust of US markets. Yes, USD (EUR, JPY, etc.) are now “weaponised” for Afghanistan, Russia, Belarus, and anyone who supports the invasion of Ukraine. However, CNY is highly politicized, as is RUB, and Chinese markets have seen net capital outflows since the start of the Ukraine War. Do any potential BW3 currencies inspire broad global trust, or just in pockets?

  High US inflation hardly backs the USD. However, the Fed is flagging rate hikes of as much as 325bp this year and quantitative tightening (QT). That backdrop will support USD: and that is true if that level of rates can be sustained, or if it can’t, and the US (and world) economy falls into recession – taking commodity prices with it. Only if the US re-embraces QE despite high inflation would the USD’s store of value be undermined.

  We agree that military power ultimately underpins global reserve currencies. On that front, while overstretched, the US still holds primacy, and its allies in Europe, Australia, and Japan are rearming rapidly. By contrast, Russia’s martial prowess has been called into question in Ukraine, and China’s remains entirely untested, despite the incredible growth rate of its armed forces.

  Method of accounting

  No other global currencies offer the scale of US markets or its ‘network effect’. Try to talk about trends in global GDP without using USD as the common denominator. In a reflexive logic, the more people who use a currency, the more the currency is used.

  This is particularly the case in terms of Eurodollars (offshore USD borrowing). The sheer scale –hence power– of Eurodollar debt means setting up an alternative is a daunting task: even China had $2.7trn of FX debt as of the end of Q4 2021.

  Indeed, if one presumes USD will be pushed aside, one is logically arguing a lot of Eurodollar debt will default, as few will be able to earn enough USD to repay it. That would mean global market chaos.

  Means of exchange

  The USD is welcomed globally, and its high liquidity means low transaction costs. The same is not true for any other potential alternative currencies.

  Indeed, China lacks an open capital account, which means CNY is not free-moving or freely traded. This is an economic policy choice on China’s part which hugely limits CNY’s global attractiveness.

  Triffin Paradox

  The Triffin Paradox is that global demand for a reserve currency forces the country that owns it to run trade deficits. For fiat USD that also means offshoring industry (i.e., via foreign net exports to the US) and, as we now see, rising domestic inequality. There is growing pushback against this within the US, but no idea of how to maintain USD’s reserve status while doing so.

  Any BW3 currency trying to push USD aside would have to be willing to run large trade deficits too. However, if commodity prices are high, major commodity producers run trade surpluses, stopping the spread of their currency; and if commodity prices collapse, their currency does too, again limiting its global attractiveness.

  China also runs a large merchandise trade surplus (even if it also runs a huge commodities deficit) in order to support industrial employment, as well as to ensure the stability of CNY via the balance of payments. Combined with capital controls, this further limits any global reserve role that the currency could ever hope to play.

  How does one earn CNY? How do CNY get into the global system within BW3?

  WBW3WW 3: structure

  Fundamentally, BW3 does not work because of the structure of the global economy. The essential nature of commodities has been laid bare by the Ukraine War, but total global trade in them is still far smaller than other goods combined (Figure 7). That is a very low ceiling, or narrow base, to build a new world order on.

  Perhaps if all commodity exporters were united it might be possible – but they aren’t.

  

  Indeed, only a few major food exporters are pro-BW3 (Table 1). One can take out the Western producers: Australia, Canada, the EU, New Zealand, and the US.

  

  In terms of energy, there are again major Western producers –Australia, Canada, and the US– but the majority are located in the Middle East. The US is the traditional hegemon there too. True, this situation may be changing as the US tries to pivot to Asia and is dragged back to Europe by Russia – but it is a huge geopolitical gap for China to fill, even presuming the US doesn’t pivot back.

  Moreover, global oil markets need a base currency that is: liquid, which CNY is not; freely tradable, which CNY is not; and stable, which CNY only is because it does not meet the other two criteria, and because it is soft pegged to the USD!

  Even a move to oil priced in a basket of currencies is hugely complex to maintain across all OPEC partners, which is why it has not happened yet. Hence energy producers are seen as ‘floating’ at best but are hardly set to rush to switch the USD for CNY (Table 2).

  

  In terms of mineral exporters, there are a large number of floating countries, and the same general cluster in the pro-West and pro-BW3 camps.

  

  The simple message is that BW3 has a significant tranche of global commodities behind it, but mainly because of Russia; the West has the same, but because of a broader range of resource-rich economies; and most of the world’s producers are looking on at the prospect of a global bifurcation with extreme discomfort.

  In short, BW3 does not yet have buy-in even from the majority of economies that are supposedly the primary beneficiaries of it.

  WBW3WW 4: more structure

  As just alluded to on oil, we have another issue: which currency will dominate BW3 trading? It’s one thing to say, “commodity currencies.” It’s another to explain how the BW3 would function if BRL, ARS, AUD, RUB, IRR, etc., were all commodity pricing currencies simultaneously. Who would clear this? At what exchange rate? In what system?

  Until that is resolved, the USD needs to remain the currency commodities are priced in, even if we see some offsetting BW3 transactions in local FX.

  Indeed, the proto-BW3 is attempting to keep the current global architecture while trying to cut some USD out of some trades, or to insert another currency where they were previously absent. To give three key examples:

  Saudi-China CNY oil sales: Saudi Arabia may export some oil to China and be paid in CNY for the first time. It exported $56bn of energy to it in 2019 – but that is a fraction of the $2.6 trillion traded global oil market.

  Because the Saudis’ own currency is pegged to USD, it would open itself up to FX volatility using CNY. As such, Saudi would price oil in USD and allow (some) payment in CNY; then the Saudis would sell the CNY back for USD.

  There are limits to what Saudi Arabia would sell in CNY, however, to avoid accumulating CNY of no use to them unless everyone else makes the same shift.

  Russia-India INR trade: Floated trade between Russia and India to avoid USD will also be priced in USD and transacted in INR. A bank account will be opened in India for Russia, and as Russian commodities (and weapons) arrive in India, INR will be credited to it: as Russia buys goods from India, the account will be debited.

  This is de facto bilateral barter, technically in INR, and leaves Russia with either the need to buy more than it needs from India, or to accumulate INR claims it cannot usefully transfer elsewhere.

  Europe-Russia RUB trade: Russia demanded to be paid in RUB for its gas, and perhaps all commodities, and Europe refused to do so. Yet a face-saving solution was found. Europe still pays for Russian gas in EUR or USD, but Russia insists on Gazprombank selling them for RUB to a Russian entity before both are then remitted back to Russia.

  Meanwhile, Europe appears intent on – slowly – decoupling from Russian energy completely.

  It should be clear that a BW3 anchor FX/clearing currency would have to be found.

  Even though China is huge commodity importer, not exporter, which runs counter to the whole BW3 concept, CNY is the obvious candidate as a BW3 anchor: only China has the economic scale.

  As already shown, CNY does not meet the criteria to be a global reserve currency because of its closed capital account and trade surpluses. However, for the BW3 commodity producers that China runs a deficit with, CNY may be able to play a larger role. (Figure 8.)

  

  Yet because CNY is still not going to be a true global alternative to USD for structural reasons, there are still rigid limits on how much bilateral China-BW3 trade we might actually see shift, as we shall now show.

  

  WBW3WW 5: trade data

  The numbers don’t add up for BW3 and CNY – at least not as a global game-changer.

  

  Total global exports and imports were $38trn in 2019 (Figure 10) to remove Covid/post-Covid distortions. The US accounted for $4.2trn; Canada, the UK, Australia, and Japan –all 5-Eyes geopolitical allies, or under the US defence umbrella– $4.0trn; the Eurozone $5.2trn internally and another $4.0trn externally; China $4.6trn; and the rest of the world $16.2trn, most of it in USD. (NB the data are only available in USD!)

  In summary, China accounted for 12% of global trade vs. just 2.6% of central bank reserves at end of 2021 (Figure 11). On the surface, that appears a very bullish argument for the currency, BW3 or not – and BW3 argues it will rise.

  

  However, we need to dive into that $4.6trn/12% data to show why CNY is not doing better, and likely won’t do much better even under a proposed BW3.

  (Figure 12 shows China’s trade breakdown by region and separates Russia from the continent of Europe for obvious reasons.)

  

  First, China’s trade with Hong Kong ($561bn) is counted as external. We colour it red to show it is part of the national economy.  China could switch that to CNY but would undermine the role of Hong Kong and the HKD’s USD peg.

  Then we have Russia ($111bn); the Middle East ($263bn); Africa ($208bn); Asia excluding Japan, India, and South Korea ($728bn); and Latin America ($315bn) adding a further total of $1.6trn. All are shown in shades of orange to indicate they are open to doing trade in CNY.

  However, more than half of total trade ex. Hong Kong is with North America, Europe, Oceania, or parts of Asia that for geopolitical reasons will not trade in CNY. Moreover, China’s trade patterns (Figure 13) show how much it relies on surpluses with North America and Europe: the risk is that the more China backs BW3, the less the West trades with it, undermining its total trade surplus.

  In short, China’s maximum CNY global trade share is 4.3% vs. its current 2.6% share of CNY reserves globally.

  The primary targets for a major USD > CNY switch are in Asia ex. Japan , India, and South Korea (Figure 13). However, ‘orange’ countries might only shift some trade to CNY, not all of it: the trade logic says that will be the case.

  

  China imported $211bn of goods from Asia* in 2019, half primary goods/resources, where we presume it could be the BW3 anchor, half manufactures (Figure 14). It exported $517bn of low, medium, and high-tech items as part of electronics supply chains.

  

  This left a large trade surplus for China. If bilateral trade was all in CNY, Asia* would need Chinese FDI or loans to cover its trade deficit, with no means of net earning CNY. Moreover, many of the electronics goods it imported from China are re-exported to Western markets, earning USD.

  As such, the maximum Asian* countries would want to shift to CNY would equal their China exports, as an offset to their imports from China (the red area in Figure 14). So, the total shift in trade is not imports and exports ($728bn), but Asia’s* exports to China ($211bn) doubled, which is $422bn.

  

  Yet the number is likely even lower given the complexity of managing balanced CNY trade in so many categories of products. We could perhaps see the total of Asia’s commodity exports to China shift to CNY, so only $120bn. As such, total CNY trade might only be $240bn from a total of $728bn. And presumably those commodities would still be priced in USD – at least until the Middle East, from which Asia* buys energy, changes its currency peg.

  Similarly, China’s trade with the Middle East saw it import $146bn of mainly primary goods/resources, while exporting $116bn of a broad range of goods (Figure 16).

  

  China obviously wants to buy all its commodities in CNY. However, as already noted, the Middle East, with currencies mainly pegged to USD, would only consider switching trade to CNY to the total of their import bill from China, which is less than that total.

  In short, $116bn of Middle East commodity sales could shift to CNY and be doubled with $116bn of CNY flowing back in the other direction for consumer goods. That is the maximum CNY shift unless China sells a lot more to the region, which would arguably need to be military equipment. The geopolitical risks there should be clear!

  If oil and gas are still priced in USD, this would be de facto barter or countertrade avoiding USD more than real trade in CNY.

  Looking at Latin America (Figure 17), the region exported $149bn of commodities to China, and China sold it $151bn of goods of all kinds. Here we see a genuine argument for more CNY trade compared to the total bilateral trade being done.

  

  The picture is similar for Africa (Figure 18), where total exports to China were $95bn, of which $85bn were commodities, while China sold $113bn of goods to it.

  

  We should also add Russia (Figure 19), where Chinese exported $53bn and imported $57bn, with Russia running a slight trade surplus. For obvious geopolitical reasons, Russia is rapidly embracing CNY – but major Chinese firms from SOEs to Huawei are still wary of US and EU sanctions so far.

  

  Using this methodological approach for each region/economy China trades with, we can summarise the total global CNY shift we expect to see (Figure 20).

  • The total theoretical CNY shift is if all trade moves to it under BW3. However, only some countries would and not all countries will do all trade in it: grey areas indicate where they will not.

  • The major CNY shift (in light orange) is if all potential pro-BW3 countries maximize their CNY trade at the level of their total imports or exports, whichever is lower.

  • The likely CNY shift assumes a lower move to CNY with an assumed coefficient driven by geopolitics.

  In Russia’s case we assume it is 0.8 (i.e., 80% of maximum shifts to CNY). For the Middle East, we assume 0.25 because of USD pegs; for Africa, 0.30 given geopolitical competition for its commodity exports from Europe, Japan, the US, and India; and for Asia* and Latin America 0.25 because of economic competition and/or ties to Japan or the US.

  

  The results are hardly a paradigmatic shift away from USD:

  The major CNY trade shift is worth $1,254bn, equal to 3.3% of global trade vs. a current CNY global reserve equal to 2.6% of the global total. As such, CNY holdings would rise by around a third in Africa, Latin America, the Middle East, and Russia – but nowhere else. (Figure 21.)

  The likely CNY trade shift is worth $381bn, equal to 1% of global trade. That is lower than the current holdings of CNY reserves: while some economies would add more, Western economies may hold less. (Figure 21.)

  In terms of FX trading, the major shift is only worth $4.8bn per working day, a drop in the ocean for the $6.6trn global FX markets, and much of that would be offset trading, not selling USD for CNY. In the more likely case, it is only $1.5bn a day, which would hardly be noticed.

  In short, BW3 is not looking like a global alternative to USD – just a cluster of Chinese hub-and-spokes offset/barter trades trying to avoid USD as middleman.

  

  WBW3WW 6: geoeconomics

  BW3’s prospects would be boosted if CNY was adopted by third parties globally: yet we have already explained why this is structurally very hard to achieve.

  Two countries that both run trade surpluses with China, e.g., Brazil and Russia, could decide to use CNY to settle some bilateral trade. However, given CNY would remain structurally locked out of the USD’s broader global role, this could arguably best occur within the specific industries that earn CNY: how much intra-commodity industry Brazil–Russia trade do we see? Not much at all.

  This is economic geography at work – and against BW3.

  Global trade-flows mean even if more commodity producers were on board with BW3 it would count for little because BW3 does not replicate the structure of commodity producers, goods manufacturers, and final consumer markets – which are mainly in the West.

  Commodity producers can try to force the West to take their currency, like Russia, via economic coercion. Yet countries running large trade surpluses don’t allow others to earn that currency to pay in it!

  Moreover, the West can walk away – as it is pledging to do from Russian energy. Unless every commodity producer backs BW3, there are alternatives – and/or technological innovation to reduce commodity intensity. And, to reiterate, if all key commodity producers walked away from the West, they would lose those markets for their commodities.

  The only way BW3 could avoid this problem would be if the global economy fragments into multiple value chains. The West still has key resources, technology, allies, a strong military, and could even onshore production if needed: could BW3 commodity producers (and China as importer) replicate or sustain value chains without Western technology and Western end consumers? Looking back, some BW3 countries tried that during the last Cold War – and import substitution did not work well for them (Figure
  22).

  Moreover, look at the terrible demography in Russia and China, and their structural economic problems. Could either afford to walk away into a more isolated, combative realpolitik BW3?

  It seems highly unlikely Russian autarchy work this time given repeated failures over the course of history. How long until it can replace its foreign-built capital stock, foreign-designed cars, trucks, and planes, or high-tech goods?

  China could fill that BW3 technology gap: yet if so, it would lose Western markets. We would see geopolitical fragmentation – not horizontally, as BW3 commodity producers replace the West, but with parallel value chains from commodity producers to China and the West.

  Yet look back at Figure 13 and imagine what the loss of a net $430bn in EUR and USD net trade inflows would do for China’s economic and FX stability. That is more than China can hope to offset with lower use of USD under BW3.

  And what would decoupling mean for its commodity demand, which is where it is supposed to be the BW3 anchor? And let’s not forget China already has economic problems that call into question how long it will remain a giant commodity consumer (i.e., iron ore).

  

  Mapping out the problem

  To make these economic-geography points in another way, we created 3-D BW3 trade maps (Figures 23, 24) that show intra-BW3 trade by region, excluding India, Japan, and South Korea and China; and with China and the US.

  The conclusion should be immediately obvious: intra-BW3 trade excluding China is only a fraction of that between each of those regions and China,… or with North America – which can be seen is still a hugely important trade partner for most of them.

  In short, CNY will not be adopted by third parties either within BW3 or outside it.

  

  WBW3WW: conclusion

  Alongside dramatic world events ‘Bretton Woods 3’ has an appealing market narrative. Indeed, we agree with a lot of its core arguments, depressing as they are.

  However, it is not new. It is old. And in not looking back enough, it fails to look forward sufficiently.

  To argue that we are going to see shifts to Cold War and global Great Power struggles, and a world in which commodities, logistics, and the military all play key roles alongside finance and currency, and with a geopolitical need to run large trade surpluses, is to argue for an ancient economic philosophy: mercantilism.

  Modern economists may have forgotten the true meaning of that term, but it reigned as long as commodity currencies did – and it implies a highly realpolitik global environment. To be fair, BW3 implies the same without naming it directly.

  Yet is that backdrop negative for USD and positive for BW3? No.

  A mercantilist realpolitik environment is one in which the requisite set of resources and diverse sources of power, after some policy shifts(!), still rest more with the US and its allies and their military, soft power, and financial power, than with a cluster of commodity-producing states (and one commodity importer).

  That is especially true if that cluster want to create a parallel economic and financial structure from disparate net exporter polities, who do not trade horizontally together to any great degree, and while also still exporting to the rival West!

  As such, BW3 will not work, and USD will retain its leading global role – albeit perhaps with more sticks and fewer carrots.

  If we were to see fewer USD circulating internationally via trade, servicing Eurodollar debt will just get harder – and that will keep a structural bid behind USD. By contrast, borrowing in CNY will still be unattractive for almost every economy given China’s persistent trade surpluses and capital controls.

  As such, on BW3 all we will see at best, is a marginal increase in the ‘offsetting’ use of CNY ahead – and more rapid global decoupling, likely to its ultimate detriment.

  Tyler Durden
  Wed, 04/13/2022 – 19:00

• Mexican Trucker Blockade Paralyzes Texas Border Crossing
  Mexican Trucker Blockade Paralyzes Texas Border Crossing

  Commercial traffic at a key South Texas border crossing has been halted due to a trucker protest on the Mexican side of the border, added to fears of more supply chain disruptions for fresh produce, according to Bloomberg. 

  The Pharr-Reynosa International Bridge, one of the busiest trade crossings in the Rio Grande Valley and handles a large volume of Mexican produce, including avocados, broccoli, peppers, strawberries, and tomatoes, closed in both directions after Mexican truckers blocked the port of entry in a move to express their discontent with Abbott’s new rules to enhance searches of 18-wheelers for drugs.

  

  The truckers say Abbott’s order to add another layer of inspections has slowed down their transit time through the port of entry and is why they’re holding a protest. 

  “The commercial traffic at Pharr International Bridge is currently halted temporarily, in both directions, due to a protest occurring on the Reynosa side of the bridge and due to no southbound movement by U.S. carriers,” U.S. Customs and Border Protection said. “Under established business resumption protocols, northbound commercial traffic is diverted to neighboring ports of entry in the interim.”

  🚨 The busy Pharr-Reynosa bridge remains temporarily closed this morning. It’s a major route for produce into the U.S. from berries to 🥑. Controversial expanded safety inspections under new initiative by Gov. Abbott appear paused. pic.twitter.com/kk3dRH77ax

  — Dianne Solis ✍🏽 (@disolis) April 12, 2022

  https://platform.twitter.com/widgets.js

  As of 0945 ET, live camera feeds from the bridge showed no southbound or northbound traffic. 

  On Tuesday, Mexico’s Deputy Trade Minister Luz Maria de la Mora sent a letter to Abbott with hopes to resolve port delays and keep trade flowing. Though nothing has been resolved as of Wednesday morning, truckers are being rerouted to other ports of entry nearby, causing widespread traffic jams. 

  Jerry Maldonado, president of the Laredo Motor Carriers Association, told Bloomberg that wait times at the Laredo port of entry jumped to 4 hours from the usual 30 minutes following the disruptions at Pharr-Reynosa International Bridge. 

  Dante Galeazzi, chief executive officer of the Texas International Produce Association, warned in an open letter to Abbott that his new search “order has wreaked havoc up and down our supply chain and is likely to leave state store shelves with limited fresh produce supplies.” 

  Tyler Durden
  Wed, 04/13/2022 – 18:40

• Georgia Gov. Kemp Signs 'Constitutional Carry' Bill Into Law
  Georgia Gov. Kemp Signs ‘Constitutional Carry’ Bill Into Law

  Authored by Isabel van Brugen via The Epoch Times (emphasis ours),

  Georgia Gov. Brian Kemp on Tuesday signed a bill into law that immediately allows permitless handgun carry for most residents in the state.

  

  The measure, Senate Bill 319, dubbed the Georgia Constitutional Carry Act, passed the legislature April 1 mainly along party lines.

  It allows residents to carry a concealed a firearm without a license, with the exception of people convicted of a felony, or those have been treated for certain mental health issues within the past five years.

  The Republican governor said at a signing ceremony that the new law allows Georgians “to protect themselves without having to have permission from your state government.”

  “The Constitution of the United States gives us that right, not the government,” Kemp said.

  Republicans argue that requiring a carry permit, which costs about $75, infringes on Second Amendment gun rights. They also cite permitting delays in some Georgia counties during the COVID-19 pandemic.

  Georgia state Republican Sen. Jason Anavitarte, a sponsor of the bill, said during the signing ceremony, “Today was a victory for the safety, security and constitutional rights of hardworking Georgians.”

  “This bill is about self-protection and self-empowerment,” said Anavitarte. “It’s about disincentivizing criminals and empowering law-abiding citizens to defend themselves and their families.”

  

  Georgia Democrats held a rally on Tuesday in protest of the legislation, which removes the background check for a permit to carry a loaded or concealed handgun in public. Democrats note that more than 5,000 people applied for permits last year and were blocked, and say police and the public will now face the danger of some of those people carrying guns.

  Background checks would still be required when purchasing a handgun from a store or a dealer, the Atlanta Journal-Constitution reported.

  “Yes, I believe in the Second Amendment,” said Sen. Donzella James, an Atlanta Democrat. “But why are we spreading the access to guns to everyone?”

  “We refuse to accept a Georgia where it’s easier for criminals to carry guns but hard for many Georgians to get health care,” Georgia Democrats wrote on Twitter. “We must change our leadership in November and defeat Brian Kemp.”

  Georgia is the 25th state with such a law, and the 10th added in the past two years.

  “People don’t have to carry if they don’t want to,” Kemp told reporters on Tuesday. “But this is a constitutional authority that people have, and they certainly shouldn’t have a piece of paper from the government to be able to legally carry a weapon.”

  The Associated Press contributed to this report.

  Tyler Durden
  Wed, 04/13/2022 – 18:20

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