Richard Wolff and Michael Hudson: West’s Colossal Failure: Peace Summit in Switzerland, US Decline, Rise of BRICS

Yves here. Michael Hudson and Richard Wolff riff on the latest US self-destructive acts and resulting increased alignment of major Global South players, and put the trajectory in historical terms.

By Nima of Dialogue Works. Originally published at his channel

NIMA: So nice to have you, Michael. And let’s get started with an article in Bloomberg, it says that the United States is concerned about the strengthening ties between Russia, China, Iran, and North Korea. And Richard, should they be concerned about this?

RICHARD WOLFF: I think so, yes, they should be concerned. Whatever in the world that means, it’s the kind of speech you get from a potentate who doesn’t realize that he’s not the potentate of anything anymore, but has not wanted to face that, and so talks in this peculiar language, we are concerned, are we all supposed to be children looking up to the great personage who’s concerned?

It’s so foolish that it only makes the people who talk like this look ridiculous. Of course they’re concerned.

Part of the reason that you see the alliance between Russia and China, North Korea, Iran, and so on, is because of actions undertaken by the United States. If they’re concerned, maybe they ought to wonder about their own contribution to this situation.

Now what we get is we’re concerned, and that seems, if you ask the question, because they don’t want to have to say it, that seems to be connected, maybe this concern to what they’re doing in Ukraine or what they’re doing now in the Middle East.

They are permitting, you know, the Chinese foreign minister, either yesterday or the day before, made it crystal clear, we are on the side of the Arabs. We are on the side of Lebanon and the Palestinians. They are our brothers, just so there would be no mistake about what he meant.

And why would you think the Chinese take a position on these questions that are thousands and thousands of miles away from them? It’s because they are very determined to be a reliable ally. And they have the clear sense that the United States is working itself into very dangerous dead ends in Ukraine in one way and in the Middle East in another way. They are losing. There’s nothing much they can do. They lose either way.

So for me, the concern is just another silly way to imagine that anyone pays attention to you when you talk like this.

You think the Chinese are surprised to hear that the United States is concerned? I mean, again, it blows your mind at this level. I suppose it’s intended to reinforce an American sense that we don’t face the kinds of problems we do because it’s not more than a matter of some concern.

Look, the United States is involved in Ukraine. On the other side is Russia. Russia is winning that war. Ukraine is losing that war. The United States has agreed to escalate that war over and over again. Level of funding, level of troops, Abram tanks, A-16 fighter jets, and now the question of the missiles into Russia and so on. Every escalation justified by enabling Ukraine to win. And after every escalation, Ukraine loses. This is the truth. It has nothing to do with concern.

They understand that they terribly, badly underestimated Russia’s power. And I mean Russia’s military power, and I mean Russia’s diplomatic power, its alliances, and even its economy. Russians are now producing most of the munitions they use, and therefore they’ve been able to ramp up their economic machinery, even though they are infinitely smaller.

Let me remind everyone, Russia is a two to three trillion dollar GDP. On the other side of the war, Western Europe and the United States together, 30 to 40 trillion dollars. You understand? It’s a 20 to 1 ratio. And yet the Russians are outproducing munitions and everything else from their industrial economic base. The Americans didn’t get that. The British didn’t understand it. Their wonderful CIA and MI5 and all the rest of them didn’t know, or possibly the leaders in the United States and Western Europe didn’t care or didn’t listen.

It’s quite clear now that the Pentagon doesn’t want to give the Ukrainians any more. It’s not just Mr. Trump. It’s the Pentagon under Biden that is telling him, don’t do this.

And part of the reason is, and I know this will upset people, but I’m just telling you what I read. I have no privileged access to any information that anybody else couldn’t get. The Pentagon seems to believe that in a war now, Russia is better prepared than the West. Wow. This is David and Goliath, and I hate to tell you, but who’s in which position? Russians are David and we here are the Goliath waiting to be knocked over with a slingshot. This is an extraordinary situation. It is so far beyond the word concern that it is downright ridiculous to talk like that. Unless there’s somebody you think you can continue, excuse me, to fool with that kind of language. And I really think that number is shrinking too.

MICHAEL HUDSON: You said that the United States is not only concerned, but alarmed and these statements are almost a comic parody of how blind the United States and its diplomats have been by their own neoliberal policies.

They’ve created a sense of urgency for other countries to band together to protect themselves from the U.S. actions that are aimed at preventing them from acting in their own self-interest.

As Benjamin Franklin said, if you don’t hang together, you’ll hang separately. So of course, Russia, China and Iran have joined together as part of the Shanghai Cooperation Organization.

What’s so laughable is the U.S. blind spot in not expecting other countries to fight back and create an alternative to the plans that the United States has. It’s as if the United States thinks we can act and other countries won’t respond. They have no choice but to do what we’ve said. After all, we’ve tried to put in place our own proxies as their leaders, just like we’ve done in Europe. We can treat other countries like we treated Iraq. We could just march in militarily, no resistance at all. We can do whatever we want.

Economically, they can go to Europe and they can blow up Nord Stream Pipeline and essentially block out the European industrial recovery and Europe will go along with it, won’t do anything at all.

So that’s what makes the United States not only concerned, but actually surprised that this is happening. They did not take into account the idea that other countries will react and that they will react in their own self-interest and from the U.S. point of view, they can say, well, what self-interest after all? They haven’t really shown anything yet, just like Russia hasn’t yet really fought back against NATO. The other countries together haven’t created an alternative to the U.S. diplomacy.

And what they realize, reacting to the U.S. diplomacy isn’t simply about the recent New Cold War attacks. It’s not simply about Ukraine or about Israel. It’s about the whole system that the United States set up after World War II to control the world, to the IMF and the World Bank.

So what we’re really seeing is the flowering of the drive for independence that started with the Bandung Conference in Indonesia 70 years ago. Their aim has remained constant, to protect their self-interest from being victimized by the world in which the U.S. diplomacy created in 1945, then created again in 1971 when it went off gold, and then in 1991 after the fall of the Soviet Union, a whole new world has been created basically under U.S. direction. And for the first time now, other countries are seeing the need to create their own alternative and to become independent.

And the United States just is unprepared for them acting economically and politically to join together, as it was unprepared for other countries actually to fight back and to actually be stronger.

Well, what Richard has just described in the military sense of, it turns out, militarily, the U.S. Army itself has said Russia’s stronger, economically, the global majority stronger, led by China, Russia, and Iran as the basic core for all of this.

So the United States has started a war thinking that it was Goliath, thinking that anything it could do, other countries would only react passively and accept whatever the U.S. is doing.

All of a sudden, that short-sightedness of economic planners and military planners has shown that the United States never thought of a plan B, and the plan B might include other countries acting on their own behalf. And that’s what we’re seeing right now.

They’re being driven to do this by the U.S. economic and financial and military aggression. They see themselves being essentially threatened just as they’re threatened by being turned into what’s happened in Germany and Europe, what’s happened in Gaza and Lebanon. They don’t want that fate to befall them, and now, for the first time, they’re acting together.

RICHARD WOLFF: I can give you, let me add just another example of this. I am struck, and I started looking over the last week in the financial press, how it reacts, because if you’ve paid attention, you’ll know that over the last week or two, the candidate, the Republican candidate, Donald Trump, has talked a great deal about tariffs, raising tariffs against Mexico, particularly, there was a lot of discussion against the John Deere Corporation itself, an American producer of agricultural equipment, and so on, raising tariffs against Europeans, and just on and on.

Here’s what I want to point out. Not only does he feel comfortable in doing that, but in another way, the way the reports go, and I’m talking about the Wall Street Journal and financial reporting, they report what he says, they go into it, but they either don’t say a word or buried in the ninth paragraph of an article, there is a remark about how there’s also a question of, quote, unquote, retaliation.

I mean, that’s what Michael is talking about. What is this way of thinking? And again, it’s not just Mr. Trump, but the editors and the reporters who write about all of this. What do you, what? There may be retaliation? Of course, there’ll be retaliation. We’ve already seen retaliation during the presidency of Mr. Trump and Mr. Biden since there have been retaliations. There’ve been guarantees of retaliations.

You know, we even saw a headline earlier this week that the Calvin Klein fashion house is going to be investigated in China, et cetera, et cetera, and it’s crystal clear that this is in part a retaliation against these China targeted tariffs.

And there’s a look, I don’t want to be poetic, but, but the poem suggests itself. In the act of what we call containing or isolating China, what is actually occurring as if we weren’t aware is the isolation of the United States. We are giving the rest of the world every incentive not to rely on the U.S. market, not to rely on financing from the U.S., that the U.S. is an unstable, unreliable partner in economic transactions of various kinds.

That’s the serious situation. And I think it goes to what Michael was saying. You can’t do this as if every time you act, everybody will play the role you would like them to play in response. That’s not retaliation. It’s collapse.

One final example. Back in the 1970s, when the United States began to face the fact that Germany and Japan had recovered from the war, had repaired their war-destroyed industries, and had developed new industries that were geared to out-competing the United States, and they had achieved it. And suddenly American roads were filled with Japanese automobiles.

And the United States said, this has to stop. Well, the Japanese caved in. They agreed to quotas. For some years, the United States had a quota. You can bring so many Japanese-made cars here. That’s it. A quota acts like a tariff. It blocks. The difference is it doesn’t affect the immediate price. It just means after a certain number, you go to the dealer for the Toyota, you don’t get a Toyota because there aren’t any Toyotas. You’ve run out of your allowance for that year.

And when that didn’t work, the United States gave another dictate. You can produce your car, but it has to be done here. You can’t bring it in. And the Japanese, what were they going to do? First of all, the United States was such an overwhelmingly important market, they could not afford not to make it for the American market.

We are a much smaller part of the world market today than we were then. We don’t play that kind of role, number one.

Number two, they had nowhere else to turn. Now they do. And this is true for every country. The world has changed, and you’re not going to get the collapse of the people negatively impacted by American economic policy. You’re just not going to get it.

And I don’t think that has sunk in any more than that you can’t dictate what happens in the Middle East, and you can’t dictate what happens in Ukraine. It hasn’t sunk in. They just don’t get it. They don’t want to see it. They can’t afford to see it. It’s politically unpopular because you have not prepared your people to understand what’s going on.

When I talk in this country about the declining empire, I’m a teacher. I watch my audience. I can see the difficulty that this very idea occasions in their minds. I studied enough British literature to know that the decline of the British empire was very difficult for the British.

NIMA: Michael, the point is here in the article in Bloomberg. It says that because of sanctions, these countries are getting together. But what would be the policy? Do you see any sort of change in the policy of the United States in order to change, in order to address what they’re talking about?

MICHAEL HUDSON: Well, if it changed its diplomacy, it wouldn’t be the United States. I mean, it’s very difficult for it to be something that it’s not.

The neocons are completely in control, and in order to rise within the bureaucracy here, you have to accept all of the assumptions that the United States is making. And we’ve just been describing these assumptions that other countries won’t react, that the United States can do everything.

The United States wants essentially to do what the World Bank and the IMF does. It wants other countries to be forced into debt by following trade policies that rely on the United States. Once they’re in debt, it wants them to privatize and sell off their public infrastructure, their natural resources, their land and everything. And it wants the US or its allied purchasers to take the economic rents and profits from these companies and remit them to the United States.

In other words, the United States plan since 1945 has been to create an international dependency. And how can you expect a country that’s had that to suddenly relinquish it and say, all right, we’re just going to give up and be like everyone else?

Well, if any congressman would say that and say anything, but we’re America first, we can do everything, that congressman would be voted right out of power.

So the first thing the United States has had to do is make sure that we don’t have a parliamentary system like Europe. We can’t have a third party. We can only have a duopoly of the Republicans and Democrats where the politicians who are elected are all saying the same thing. We’re number one. And if you question this, you’re being unpatriotic. And if you say that you’re against the war in Ukraine, then you’re supporting Putin. And if you say that you’re against the war against the West Bank and Lebanon and Gaza, then you’re anti-Semitic.

And as long as that’s controlling U.S. politics, I don’t see the chance of anything happening.

So what happens in such a situation? The decline and sort of the destruction of a world leader always happens from within. And within now, the United States has created a “Greater The United States”, sort of like a greater Israel over the whole Near East or the Soviet Union over the whole of Central Europe.

The United States has absorbed Europe into its whole Cold War policy. And you have England being even more pro-U.S. than the U.S. because that’s how you get U.S. support to end up in the position that Mr. Starmer is in, for instance, or von der Leyen in the European Union.

So I think what’s spooking Europe right now is the thought that they may have to be called on to support the U.S. by sanctioning not only Russia, but now they have to sanction China and include any of the global majority allies that the United States has, anyone but the United States.

So the United States is breaking up its self-interest not only with Europe, which has been the core of the U.S. foreign orbit, but in the United States itself. The American economy, especially the computer sector, is heavily dependent on China. If there are sanctions on imports from China, then that all of a sudden is going to price the United States out of the world market.

You’re seeing Intel already going under, and you’re seeing American industry protesting and saying, wait a minute, we need Chinese gallium and germanium and cobalt and all sorts of rare earths that we can’t get away with.

So all of a sudden you have the economic strains conflicting with the political strains. Well, Richard and I both believe in historical materialism. We expect countries to act ultimately in their economic self-interest, and what the United States is doing is not acting in its economic self-interest, but the political sort of infantile narcissism of the neocons. We can do anything, and if you don’t do anything, we’ll hurt you or throw a temper tantrum and do something you won’t like.

So what we’re really seeing is within the United States itself, a conflict between the neocon dreams of world control and the domestic economy of the U.S. and its European satellites saying, wait a minute, your dream is not realistic. Your fantasy is destroying our reality of the economic prosperity that you are supposed to promote, and also economic freedom.

You and the United States have had, you’ve forced us to suspend economic freedom. When there is the three elections in Germany with the German parties opposing the war in Ukraine, the alternative for Deutschland, the European response at U.S. direction is to ban the party. You cannot have a democracy where you let people vote against U.S. interests. You have to ban Russian opera singers from singing. You have to ban RT. You cannot have a democracy if you have free speech that says that what we’re living in is a fantasy world, not a reality world.

So you’re redefining democracy itself to be any country that follows the U.S. demands for world control. It has nothing to do with free— it means abandoning free speech. It means abandoning the First Amendment. It means abandoning open contacts. It means abandoning free trade to deal with countries that the United States are against.

The United States’ dreams are forcing a radical reversal of everything that the United States said was the root of Western civilization. So what we’re seeing today is that America is attacking the concept of Western civilization and civilization itself in what it’s doing in the Ukraine in the Near East.

RICHARD WOLFF: You know, there’s a historical echo in what Michael just said that might be worth keeping in mind.

After World War II, the business community of the United States collectively acted in horror at what had happened during the Great Depression and in the war. I want to remind everyone, a social democrat, a politician like Franklin Roosevelt, accommodated to a revolt from below, led by the CIO, the union organization, and abetted by strong socialist and communist parties here in the United States. And they acted together, led by the head of the mine workers union, John L. Lewis, and they made big changes. That’s why we have social security, unemployment compensation, the first minimum wage, and government jobs by the millions.

All of those things were achieved in the depths of the Depression when, quote unquote, there was no money. Oh, it turned out there was.

And then a war was fought during which the United States allied with the Soviet Union. Post offices in the United States had pictures over the clerk’s window where you went to buy your stamps, and there you’d see a cartoon Uncle Sam arm-in-arm with Uncle Joe. And that Uncle Joe was Joseph Stalin, for those of you who don’t know, or don’t remember, or don’t want to know your own history.

And at the end of that 10 years of depression, five years of war, the business community was horrified by where politics in America was going. And they mounted a crusade, I chose the word carefully, to undo the New Deal, to undo the political alliance that had made it possible, socialist communist parties allied with labor unions.

The second half of the 20th century was the systematic destruction, first of the Communist Party, then of the two socialist parties, and then of the labor movement, which went from representing almost 40 percent of the labor force to representing today somewhere around 10. A catastrophic decline running the entire period.

We have to understand that the slogan of the time was, you cannot question anything about capitalism, because if you do, you’re a communist, and therefore you’re a Stalinist, and therefore you’re an agent of a foreign power.

Stalin is gone. The Communist Party is a shell of what it was in Russia. Putin is a strong anti-communist, pro-Russian Orthodox church leader, but it doesn’t matter, because all of this comes out of the American situation. We need another Stalin, and if there isn’t one there, we’ll make Putin into his understudy. That’s it. We need that.

But here’s the rub of all of it. You can’t keep doing that. That’s the so-called cry wolf problem. You keep doing that, and it’s less and less. You can already see that here in the United States.

They can’t do, at least they haven’t been able so far, what they did then. Maybe they’ll be able to. Maybe I’ll be shown wrong, that you can have another purge of the sort we associate with the name of Senator Joe McCarthy.

Maybe Mr. Vance or someone like that will play that role for us. But I can assure you, the world, even if the U.S. can run that game again, the rest of the world will not sit quietly by.

It’s not what it was in the 1940s, 50s, and 60s, destroyed beyond words, having to focus its entire energies on rebuilding from World War II. We’re not in that situation. Those countries are in very different places, and it’s a luxury we cannot afford.

So I don’t think it’s an option, and that’s why I keep saying we are a declining empire, and we’re only making that situation worse by pretending it isn’t happening.

NIMA: Michael, do you want to add something?

MICHAEL HUDSON: Well, he’s essentially filled out what I was saying before. He’s quite right. When I was a teenager in the 1950s, my socialist friends, and most of my friends were socialists, said that World War II wasn’t simply a fight between the United States and Germany. It was a fight over what kind of socialism the world was going to have after World War II. Was it going to be national socialism or Nazism or the kind of socialism that we talked about that had developed ever since the 19th century?

And, of course, we all hoped that capitalism itself would find its self-interest in evolving into more and more socialism. The government would play a rising role, continuing what Roosevelt had done with the New Deal, into more and more socialist, social democratic policies, and that seemed to be the case here in the British Labour Party and in other countries. At least those were not run by U.S.-backed dictatorships.

What turned out is that what we didn’t know at the time was all of the U.S. appropriation of the ex-Nazis in Operation Paperclip to use them in the United States to fight. communism, as Richard has said.

And the attempt to sort of plan, there’s still going to be an attack on Russia, we have to bide our time. And what’s developed is that the United States is literally backing a Nazi country in Ukraine that is quite openly the reincarnation of the German Wehrmacht with the same insignia and the same heroes that worked with the Wehrmacht in World War I.

Same thing in the Near East. It’s backing a philosophy of ethnic hatred towards people who are not your ethnicity.

All of this is in many ways a replay of the fight that occurred at the end of World War II, but with the United States not taking the side that we seem to believe it was taking at the time.

NIMA: What’s so amazing right now that Emmanuel Macron recently said that we have to think of the conflict in Ukraine, we have, right after this conflict, we have to have some sort of relationship between Europe and Russia.

But with the current phase of the conflict and the way that the European Union is behaving right now, do you see any sort of policy on their part to consider the relationship in the aftermath of the conflict in Ukraine?

MICHAEL HUDSON: Well, here’s what’s so unique. When you say Europe, you’re referring to the European Commission of Von der Leyen and the right-wing Cold Warriors that she’s appointed.

This is not what the European population has voted for. The European population in France, the French population, didn’t vote for Macron, but Macron is in power. They didn’t vote for the Christian Democrat leader, Schulz, in Germany, but he’s in power.

The two American presidential candidates are both pressing to extend the Cold War in Ukraine and in Israel, and yet the American voters say they don’t want to support the war. So you have a disconnect between the political leadership and the democracy.

The voters can advise and consent, that’s about it, but they don’t have any enforcement.

Just like the United Nations, when it says there should be peace in Gaza, you have to let the health providers through to give food and medical care to the victims of Gaza. Israel won’t let them through. It blocks that. It insists on looking through, just delaying the trucks, holding a huge backlog.

The United Nations doesn’t have a military force to enforce what its members believe. So what’s the result going to be? It looks like there will have to be, at first, a shadow United Nations and then, altogether, a new United Nations without the current members of the Security Council, without NATO members being part of this new United Nations.

What will happen in the United States with the censorship in college campuses now? You’re not allowed to say you’re for peace in the Near East. Well, students have been expelled for saying that. Professors have been expelled for saying that.

We’re seeing an inherent instability that can only result in the kind of crisis. And in a crisis, you never really know which way things are going to go, but it looks like the global majority is going to go in a different and, I hope, more positive direction than the United States looks like it’s going in, as the political control mechanisms have taken control of— the neocons, basically, have seized control and de-democratized the United States, just as the European Commission and the Euro Commission has de-democratized Europe.

RICHARD WOLFF: I would add, Mr. Macron, in the last general election, there were two rounds. In the first round, the French people had an option to vote for a half a dozen or more parties that participate in French elections. And there were three main parties. One, a unified left party. One, the far-right national front party. And then, Mr. Macron. And he had the great distinction of being a sitting president whose party came in third out of three. He’s the dead political animal, number one. And so, the fact that he supports Ukraine tells you something.

Michael is quite right. If you add together the left-wing vote, and let me remind those who may not know, the new left-wing party, the popular front, the new popular front, is a combination of the French Communist Party, the French Socialist Party, the French Green Party, and the largest of them all, which is called France Unbowed, the party of Jean-Luc Mélenchon, who’s the leader.

That party is the largest vote-getter in France. They came in first. They have more deputies in the parliament than anybody else. Coming in second, and not close either, coming in second was the right-wing nationalist party.

And then, Mr. Macron came in a distant, pathetic third. And you know what he’s associated with? Ukraine.

Now, it’s hard to say he has this or that policy because he changes policy with his underwear. It changes all the time. He was a person who said, we have to come to terms with Russia early on. A year later, he was in the forefront of the European countries wanting to send troops to join the Ukrainians. Now, he’s back toward the… I mean, maybe that’s not surprising for a politically dead politician, but it doesn’t make his “death” any less real.

Then there were the three elections in Eastern Germany, who had very much the same kind of result. The far right, revived in Germany, which would scare people anyway, and the new far left, Sarah Wagenknecht, coming out of nowhere with a new party, barely a couple years old, but able to articulate a far left-wing position. Her background is Marxist, and so on.

These are very powerful straws in the wind. Italy, the Italian leader is ambivalent.

MICHAEL HUDSON: Well, I think that what you’ve just been describing explains President Putin’s military strategy in Ukraine. Right now, people are asking, why doesn’t Russia respond more? The United States has tried to, doing everything it can to resort to terrorist attacks on Russian cities, on Russian nuclear, electric generators, hoping that it will make it respond, so the United States can then go kaboom against it, Iran, or any of its supporters.

Putin hasn’t done any. He’s going very, very slow, and people are saying, why doesn’t he just move faster? And the United States is trying to encourage political pressure with discontent within Russia itself, saying, why doesn’t he fight back?

Well, I think Putin recognizes exactly what you’ve been saying, Richard. He realizes that time is on his side. He sees these strains that you just described politically tearing Europe apart, and he sees that time is not on the side of the US neocon control over Europe.

Every few months now, we’re in a fast-moving crisis, and there’s this consciousness that there has to be an alternative to what’s happening, and essentially, Europe is being wrecked economically. The industry is going down. The balance of payments is going down.

There’s a hesitancy of other countries to hold euros anymore, because they can’t see how the euro exchange rate can be supported by German industrial exports that are in the past. German companies are moving out of Germanators’ unemployment.

So I think that Putin realizes that as long as he can just do nothing, let the NATO countries, America on the one hand, Europe on the other, let them both self-destruct as they polarize.

Obviously, the US only response is to say, how are we going to stop other countries from breaking away from the US control? We started the program by saying this US response of trying to control them by threats, by military actions, by sanctions, has had just the opposite effect of what was intended.

But the effect has been to create a sense of urgency that is driving other countries out of the US orbit, and that means not only out of using the US dollar, since Europe has grabbed the Russian foreign exchange reserves that it had there, but to create an alternative to the whole US-centered world order that was designed to create unipolar control by the United States through the World Bank control, the IMF control over privatization, and most of all, the control of all of the foreign dollar debt that’s owed by the global south and the global majority to sort of compel payments that essentially will achieve by financial terms what used to be achieved only by military terms.

So I think there’s a recognition in other countries, let’s just let these strains develop at some point, and President Putin said it’ll probably take 30 years for Europe to assert its independence from the United States.

Once the United States finds itself isolated from the rest of the world, well, it’s up to its business community, you can say, up to the dynamic of its industry. The whole laws of motion of the American economy are being threatened by this self-isolation, this ending of the American attempt to dominate others by free trade and instead by protectionism that simply raises the cost of doing business and living in the United States, to price the United States even more out of the world market.

There’s no analysis that these policies are destroying the United States economy from within because to understand that, you would have to change the whole agenda of mainstream economics as it’s taught in the universities. That’s why you and I taught at universities that were not in the mainstream and had a different view.

What we’re facing is not only a clash of power, it’s a clash of consciousness. In that sense, we’re in a really civilizational change right now.

RICHARD WOLFF: If I have a couple of minutes here, I want to add a footnote to what Michael said.

In that 30 years that Putin referred to how long it might take for all this to play out, I want people to be more aware than they may be that right below the surface, and now it’s increasingly coming to the surface, there is enormous momentum in Europe to, let’s put it this way, accelerate the process.

The premise, and I think we’ve talked about this at least briefly before, the premise is the anxiety among many components of European society that they do not want to go down with the United States.

They see a good part of what we’ve been talking about. They worry that their leaders, used to 75 years of being under the wing of the United States, I’ll leave it at that, that those leaders are committed. They’ve made their bed. They’re lying in their bed. They are the people for whom the Atlantic alliance is the beginning and end of how far they can see. Many of them have been educated in the United States. Many of them have been indoctrinated in a world where the United States defined most of everything, but right below them are the people who are living the reality that Europe is declining.

The center of technological innovation is either the United States or China. There’s nothing going on in Europe that indicates that that’s going to change any time. So you may have this or that, but basically they are not able, and yet they are a richer, if you just use the money equivalent, they’re a richer bloc than the United States. They have more people than the United States. If you unify the rest of Europe, all of it, it’s even more the case. Well, so in terms of where Britain might end up.

So there’s going to be, there already is, there’s going to be, in my judgment, growing pressure inside Europe not to make the commitment to the United States anything like what it has been. To try to play a role in between, to somehow say enough no to the United States and enough yes to China to give them some sort of balancing operation economically.

And you can see small signs of it that aren’t so small once you think about them. I’m going to give you one.

Mr. Biden, accompanied by Mr. Trudeau, and that should tell you something, has a 100% tariff against Chinese electric vehicles. So if you produce a electric car or an electric truck in China, and you try to bring it into the United States or Canada, whatever the price is, let’s say $30,000, you will have to give an equal $30,000 to either the government of the United States for the tariff here or the government of Canada for the tariff there, thereby doubling the price, making the cars unaffordable.

In Europe, the taxes about 15-20% threaten to go up to 35% next week, and there are intense negotiations.

But even before we get to how those negotiations might play out, notice the difference. If you go on the roads of Europe, you’ll see lots of electric cars, and about a quarter of them are Chinese. They’re coming in and the Europeans grumble, but they’re not gonna do what the United States did.

This is very bad for the United States. Why? Because the United States competes with Europe, probably more than anywhere else. It means all European competitors will be able to purchase cars and trucks, best quality, lowest price from China, whereas their American competitors, excluded from doing that, will have to pay $40,000 to $50,000 for an inferior American electric car. And that’s going to play out in their pricing policies, because that’s a major input.

This is very dangerous. You don’t talk about it, but it doesn’t mean it isn’t happening. And the Europeans are very clear. They don’t want to be left out of this process. They’re going to out-compete the United States in the third world, because their input price for electric vehicles is a fraction of what it is in the United States.

This is very serious stuff, and the United States doesn’t talk about it, but that doesn’t mean it isn’t there and having the impact. So it’s clear to me that the Europeans are already struggling.

My guess is that there were pro-Americans who wanted 100% tariff on electric Chinese vehicles, but the European opposition to that prevailed, and they had to have a compromise at 30% or 20%. But that’s what I’m arguing. I think that’s going to be more and more and more of that, and it’s then going to blow up.

And if Mr. Trump becomes president, and if he levies the taxes and sanctions on the Europeans, he has said he will, well then this process will be accelerated.

And before anybody doubts me, the sanctions against Russia not only failed to stop Russia in the war in Ukraine, it also accelerated the very premise with which this program began, the coming together of China, Russia, Iran, and North Korea. So these things can be accelerated by policy decisions that don’t understand what they’re feeding into.

MICHAEL HUDSON: Well, that’s what (unclear) tried to do in Argentina in the 1940s and 50s, and we all know what happened to Argentina. Other countries have tried the same. Chile tried the same thing. We know what’s happened to it. Libya tried to do the same thing. We know what happened to it. So other countries seeking to work in their self-interest may not be a pretty sight.

NIMA: And it seems that BRICS is going to come up with a new system of communication, economic communication. Richard, how do you find, do you think that the way that sanctions are working right now, how much the main power of these sanctions come from just the, everybody’s, the international relationship in terms of their economy is based on the United States, though. How about that, if they come with a new solution for economic communication, how would that affect the sanctions?

RICHARD WOLFF: Well, let me take a step back. I don’t know, perhaps Michael and I don’t agree on this one. I think sanctions are 90% empty.

In other words, my impression, I’m not a sleuth, I’m not a policeman, you know, I can’t quote you the very nature of what a sanction is and what the evasion mechanisms are, means that you’re not going to get statistics on it that are worth very much.

But here’s my impression, that most of them are a nuisance and an expense, but they are not a make or break of hardly anything. The more serious they are, the more elaborate the schemes to evade or hide or maneuver them.

The easiest way to understand this is, if you have a sanction, you cannot accept Russian oil. Okay, so then the Russians send it first to Mozambique, then they offload it from one freighter to another, and it arrives in London from Mozambique, where there are no sanctions in effect.

Right, what are you going to do, inspect every cargo? Well, if you want, you can do that, and then there are ways to get around that also.

In fact, every mechanism, it’s a little bit like, you know, all the clever mechanisms of police departments. Do we still have the crimes? Yes. Are the police able to prevent them? No. Your best hope is that they reduce it somewhat. But the truth of it is, the rest of the culture is at least as important in controlling crime as anything the police ever do.

We have in the United States the best example. We have more people in jail than anybody, we have more police than anybody per capita, and we have more crime than anybody per capita. And we’ve had all together for a long time.

Okay, so I don’t think sanctions make a big difference, but they do add inconvenience and expense, and that’s a serious problem.

And that’s why you will find more and more examples of countries looking for ways to disengage from the United States, because it is toxic in this way. They don’t want these sanctions, they don’t want the expenses of these sanctions. Absolutely, they don’t. They go to considerable lengths, but they are not going to abort their own economic strategy to evade a sanction. You don’t need to do that to evade a sanction, they know that.

There are many companies in the world, and by the way, the American government knows everything I’m saying to you. No, again, I have no special knowledge of anything. But there are companies around the world who specialize in evading US sanctions, and anybody who needs to do trade with the United States, who’s worried about sanctions, works with those companies and uses their services and pays for them to evade the sanction. It’s an extra expense.

It is dealt with by businesses in the same way that they deal with the rise and fall of the oil price, or the rise and fall of freight rates on international shipping, and so forth. These are the problems of doing business.

But instead of them being generalized in a market, they’re all concentrated in the United States, because no one else does this. This kind of sanctioning is done by the–

Remember, I gave you the statistic in an earlier program. I’ll do it again. Wall Street Journal had an article, it was wonderful to read. The United States, they counted them. 15,000 sanctions against countries, industries, and even individual business persons and firms. That’s the number one country in the world.

The number two country is Switzerland. And then the number three country, so far down the list, I can say to you, barring the weird Switzerland, which I assume has something to do with their bank secrecy rules, that’s why they have sanctions. Otherwise, who cares that Switzerland puts a sanction on you, right? So the United States is effectively, in terms of the world trade, the sanctioning country.

Okay, so that’s an incentive for every country on earth to limit its dependence on the United States. And that’s not good for the United States, not good for its exports, not good for its imports, nothing.

It may be wonderful bullshit for politicians to use for votes. And it may work that the editorial writers in the newspaper do not expose the absurdity of what is being done here. But then we go back to what Michael said, that this is a narcissism of an empire that cannot see the writing on the wall, even as the walls close in on it.

MICHAEL HUDSON: Well, of course, I agree with what Richard’s been saying. We’ve both been talking about how sanctions don’t work. I’m concerned with something much more than sanctions. And that is what remains of the international rules of world trade and investment, and the whole overhang of US dollar debt.

Sanctions don’t work, but for other countries to assert their independence from the United States, they need to be independent from the IMF and World Bank by creating their own international financial institution to coordinate their own relations, their own trade laws.

They have to get rid of the International Private Investment Court that says countries will have to pay damages if they fine an oil company for creating an environmental disaster and try to make the oil company pay. The government can be sued and have to give back, maybe with triple damages, everything that it’s tried to regulate oil companies against creating disasters.

These laws are travesties, and yet they’re part of the institutional framework that the United States has put in power just so its oil companies can pollute the whole world and not pay a penny and make the governments go bankrupt if they try to have the temerity to assert their own power as a national state to define these countries.

Under the current rules of the context that all countries have to operate in, there is a set of rules that are pro-creditor, pro-investor, and against the national self-reliance and the power of states to tax, to regulate, to declare war, to do anything independently of these rules. And that’s the whole system has to be replaced.

There’s not simply a fight against the U.S. neocon narcissists in control. It’s a civilizational fight against the way in which these neocon narcissists and neoliberal narcissists have created a dysfunctional world order.

RICHARD WOLFF: There you can see, right there, you can see the appeal of the BRICS and the appeal of China, and the writing is on the wall. If the deals that you get from the IMF or the World Bank or the United States or Britain have the quality that Michael has just summarized, and there’s tons of literature that go into this, they now have an option.

If nothing else, they can put together a trade delegation of five important people and send them to New Delhi or send them to Beijing or send them to Sao Paulo and work out an alternative.

This is an amazing thing. We haven’t had that for a long time. We’ve had a pretty harsh, unified, global capital market for borrowing countries. They can now play, you know, the West and the East against each other. It’s a whole new ball game, and they’re all learning now what it might do for them.

If they can develop, which they’re busy doing, parallel multinational institutions, parallel to the IMF, parallel to the World Bank, and so forth and so on, along with a new international currency or basket of currencies or whatever, these are all steps.

They won’t change everything overnight. The dollar doesn’t disappear, but it shrinks in its importance, and that’s pretty relentless and has already gone further than anybody has.

If you look at it, you can’t but argue it’s underway what we’re talking about. We’re not talking about the future. We’re talking about what’s going on now, and even if Michael and I sound like we’re harbingers of scary futures, we’re not.

We’re in the odd position of having to explain, as if it were new, something that isn’t new at all, has been going on for quite some time now, is already well underway. It’s just that the people where you direct this video to are probably living in an environment that understates what’s going on, kind of radically.

I mean, look at the election we talked about in France. I follow closely. My father was born in France. I speak French. I read French, blah, blah, blah. I follow the events in France. I live in New York City. I live in the United States. I’m an American citizen and all that, and I would read here, unbelievable. In the United States, the race in France was between the great leader Macron and the extreme right-wing challenge of Marina Le Pen.

When I have to explain to people, you know, just a second, excuse me, the number one political party is neither of those. They look at me blankly. They have no idea, and this is not because these people are ignorant or don’t care. They are not ignorant.

They do care, but the entire framing of that issue leaves Mr. Macron as the great president, and by the way, he gets credit. This blew my mind. He gets credit for defeating the right-wing. That’s how it was played in this country. Well, you multiply that by every other country. I mean, that’s how it was played in this country. multiply that for decades, and then you understand why it sounds strange to hear Michael and I talk about an American public and an American government that lives in another world. T

hey created this other world because the one they’d live in was terrifying to them, which I understand. But that is the reality, and my guess is there’s an accumulating awareness that this is very, very dangerous.

NIMA: Michael, do you want to add something?

MICHAEL HUDSON: No, I think we’ve pretty much covered it.

NIMA: Okay. Thank you so much for being with us today, Richard and Michael. Great pleasure as always.