Thursday, April 17, 2014

Crippling Economic Sanctions

Go back to the first colonists in North America meeting up with the natives. They established a relationship based on trade. Someone had something that someone else wanted, and the two parties managed to exchange goods in what they felt was an equitable manner.

Now hold a gun to the head of your potential trade partner and suddenly the equitability shifts very much in your favor.
Economic sanctions lead to hardship which leads to reaction. Tea, anyone?

Trade sanctions have long been used to coerce a government to do something it doesn't want to do. It did not just start in the Twenty-first Century, either.

At the moment, there is talk of the United States, a global economic power, using its strength in the marketplace to force Russia to stop doing what it has been doing, which is attempting to take over Ukraine before the European Union gets in there, with all its free markets and liberties and other dangerous notions. Russia is struggling economically due to the usual problems with cronyism and corruption, so the economy is ripe for toppling.

The gun that the U.S. could hold to Russia's head is a figurative one, of course. It is the weapon of economic sanctions that could do just enough damage to Russia before sending the world's economy into a tailspin.

England once did it to the United States when England was a global power and the United States was a collection of former colonies trying to find a way to get along.

How to get the Americans to go along with the plan back in the mid-1700s? Regulate commerce, of course, and control the purse strings. The colonists suffered financially, with businesses hurting due to a lack of free markets to take their goods in exchange for other goods or cash money. As England learned, the locals did not then toe the line scribed by royal decree, but rebelled.

So if the Russian people are made to suffer due to economic sanctions that cripple their personal wealth and ability to feed families, might they then rebel against their leaders and drive them out?

History has shown that it can happen. Wise leaders know it, and so they bend to the demands of the more powerful applying those crippling economic sanctions, but only enough to keep the peons slightly disgruntled. Hold off long enough to make others in the global economy squirm and it's like taking a few bullets out of the economic gun being held to your head.

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