The Despots are Isolated!

Putin has been the absolute ruler of Russia since 2012. Same for Xi Jinping.

What does that mean? They had all/much of the power and made themselves (and their families) immensely wealthy. They bought the loyalty of a group of cronies around them by making them (all) immensely rich as well; we call them Oligarchs or Mandarins.

What is the common denominator here? Massive corruption. These groups started by taking the cream of the top, but they wanted the lives of Billionaires and all of the fame, sex, and hangers-on that come with that.

Fast forward 10 years, what is the result? Let’s talk about Russia first. I will focus on the Russian Army first, but this applies to all of the functional entities within Russia. These CORRUPT forces were not happy with just skimming off the cream; they took the top half. So, the once-great Russian Army bought cheap tires, equipment, arms, fuel, food, and did not provide enough funds to maintain/fix them. They did away with a professional Army and replaced that with conscripts or draftees that were not well trained (training is expensive). They spent millions on the train network they inherited from the Soviets but did not buy many trucks. Why bother, as they moved everything by train? They spent lots of resources on bringing out weapons that were cutting edge, but could only build a dozen or so. They did develop “smart” weapons, but again, did not make enough of them for war use. Their existing high-tech weapons, especially those that required integrated processors/chips, were allowed to atrophy. The sanctions from 2014 had hit hard; Russians had stopped investing in education and technology. With the help of the West, they were pumping Billions of dollars, pounds, yuan, and euros worth of natural gas and oil; they could afford to buy the best technology available whenever it was needed.

In any Army, the logistics supply portion is always the place to look for corruption; someone has to buy all of those bombs, bullets, fuel, food, etc. This applies to the Russian Army especially; the Supply Corps (and supplies) was for show only. Wars are won by the side with the best logistics; Russia does not have logistics; there is no supply tail.

Many wonder about the Russian Air Force? The planes do not fly reliably; not enough fuel/parts. The pilots are not trained to use even the existing technologies as so many chips are missing. Most planes are leftover from the Soviet era and some have been upgraded. Russia invested heavily in air defense systems for foreign sales primarily. Also, it was a much less expensive defensive strategy.

The Russians have many 1000s of tanks and armored personnel carriers; again, most are leftover from the Soviets with some upgrades. Their new Armata-14 tank is supposed to be the best tank in the world; they have built just 14.  Again, these are not well maintained. There is not enough fuel, food, and ammunition. Again, not enough trucks to supply a moving army.

We are all watching the collapse of the Great Russian Army in Ukraine now. They do not know how to coordinate attacks using tanks and artillery. They lead the attacks with tanks instead of infantry; this is stupid against modern anti-tank missiles, but the conscripts have not been trained. They do not know how to plan/communicate with their air force; it has been missing in action. They sent a 40-mile convoy of essential resupply items and it ran out of fuel; their fuel trucks have all been blown up.

We keep hearing about Russian equipment being abandoned. What good is a tank that is out of fuel? It turns into a very cold hunk of steel without heat (fuel). The conscripts are walking away; they have no faith in their corrupt officers. They are foraging for food among the Ukrainians; very dangerous. Where did Russia get the fuel trucks it needed for the invasion? Belarus, but now, it does not have enough trucks either.

Just imagine that you are a Russian soldier; poor leadership/lies, not enough food or heat, your armored vehicle/tank is being blown up around you, your helicopter is being shot down, loaded with troops, and the Ukrainians that you were supposed to be liberating are hunting you. Even worse, they have better weapons, leadership, and a will to fight.

How did this happen? Putin (and Xi) have surrounded themselves with corrupt Yes-men. They have, sometimes literally, shot the messenger so many times that no one wants to bring them the bad news. Putin was told that his Army could invade Ukraine and they would be welcomed as liberators.  He believed that his forces could capture Kyiv in three days and he could install a puppet government; it was supposed to be that easy!

This has not turned out well. Putin knows that he has been systematically lied to. What can he do? He has committed 75% of the Russian Army in the Ukraine fight; he still does not have the logistics (mostly fuel/food where he needs it) to win.

Putin has lost and he knows it. The same corrupt system has permeated his Navy and Nuclear Forces; they are just as dysfunctional as the Army and Air Force. None of the nuclear weapons work anymore; he would have used a small tactical weapon by now if that was a choice. The Russians are not going to go into the cities and fight block by block; they will use rockets and artillery to level large areas; try to win by terror. Never mind being war criminals.

Even that is not going to work; not enough artillery shells. Again, like the fuel and food, ammo must be transported by truck. 500 Russian soldiers just surrendered today; that means they surrendered to a superior force. Just as in the Battle of the Bulge, German troops ran out of fuel and walked back to Germany; the same is going to happen to Russian troops. The question is whether the Ukrainians will let them off that easy.

Everything I have written about Russia applies to China, but the corruption in China is even worse. Xi, seemingly, was unaware of the shortage in coal to make electricity for much of 2021. This is despite his embargo on Australian coal.  Oh well, there was always Mongolia and Indonesia, and Russia. But, Indonesia stopped selling coal to China over South China Sea issues, Mongolia demands payment in US Dollars/will not accept Yuan, and Russian coal (or gas/oil/wheat) cannot be shipped from the Black Sea; its a war zone and ships cannot get insurance.

It has not been a great year for China; Covid has shut down the shipping ports, rolling blackouts (coal) have destroyed the manufacturing, lack of gasoline /diesel has destroyed transportation. All of this has culminated in no dollars coming in from China’s customers; yet, natural gas, oil, coal, food, iron ore, and computer chips must be bought (using dollar foreign reserves).

Even the natural gas coming from Russian Siberian fields is now in question. These gas fields depend on high-tech processes and people supplied by the West. With the Russian sanctions, those people are gone. What if the flow of gas in the pipelines cannot be maintained; wellhead, storage tanks, pumping stations, storage tanks, to Chinese pipelines? Oh, shit.

Like in Russia, corruption in China is coming to a head (like a boil). The financial system is based on property development corruption with provincial governments and state-owned enterprises. The property development bubble is, finally, crashing; people had to pay in advance for housing to be built. No housing, no one is buying anymore; the debt bubble/system has popped. Property development employs more than 10 percent of China’s workers and is 50% of the GDP when building materials, local governments (land sales), overexposed banks, and bond sales are factored. China’s real estate sector is at $62 Trillion (62,000 billion) without the local government or state-owned enterprises issues; with them, call it $100 Trillion. The real estate bubble is popping quickly now; it has already lost 60% in value and is moving towards complete collapse. We are looking at a $90 Trillion or $90,000 Billion loss (or more) in China; that will collapse much of the world’s economies. This is a financial tsunami that most of us will not be able to avoid.

Remember, China’s GDP is $14 Trillion per annum and the US is $21 Trillion; China has already lost (approximately) $60 Trillion worth, but the Chinese CCP is suppressing that information.

One last point, just as in the Black Sea, when the shooting starts in the South China Sea, all commercial shipping will STOP. So, any attempt at invading Taiwan will result in no imports of oil/gas/coal/food/raw materials/chips or exports of finished goods; China will cease to exist as a country in 3-6 months. It could break up into as many as seven different regions/countries.

One last, last point. Japan or India or Vietnam or Singapore or Malaysia or Indonesia or the Philippines could start sinking or seizing Chinese energy ships easily, even without the US Navy. Add Australia to that list, maybe. Again, all it takes is one or two and all commercial shipping will be stopped/disappear. China absolutely depends on imports and exports. Same for Russia.

Again, both China and Russia are FAILED STATES; we must spend less time worrying about them. Again, neither of them has nuclear weapons. China could have nuked one of Taiwan’s small islands long ago; would Taiwan have resisted? Does anyone think Xi Jinping would not have used these weapons if he had them? Or Putin?

Love, Light and Laughter,

Merln

 

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