As much as it troubles me I continue to be amazed at the effectiveness of Putin’s political warfare strategies – and appalled by the fact that the current Administration is in a state of denial in regard to one track and apparently blind to the second.  Of course (tongue in cheek) I’ve done my part. My book Creating Chaos received a reasonably good university library penetration and even made it into both the State Department and White House (gasp) libraries.  

I think Creating Chaos makes it clear that the major threat of Putin’s political warfare is fragmentation and destabilization.  While some level of actual election meddling is necessary as part of that effort, you don’t need to steal elections via total vote tampering, you simply need to establish the fear and the discord that associated with the possibility. You simply need a demonstration of the ways you can interfere. The current fragmentation efforts being launched against the Democratic party show how easily such a demonstration that can be carried out

Beyond that, what Putin’s campaign is accomplishing is something only dreamed of during the earlier Cold War – that of neutering the opponents entire intelligence community.  Over decades both the CIA and the KGB jumped through hoops planting poison pills and creating paranoia (James Angleton’s within the CIA being a prime example) that would undermine the opponents intelligence collections infrastructure. 

However Putin has accomplished something far different, he has created a context in which both President Trump and the Senate are not only pushing back against American intelligence on Russian actions (evaluations in which all elements of the community concur, something not at all common), but actively de-funding and obstructing efforts to cope with Russian political action – all out of fear for their own personal political concerns. It is all truly amazing and immensely dangerous. What the neocons managed to do to the intelligence community under the Bush Administrations pales by comparison.

All that is bad enough, but there is a second track in Putin’s strategy that is getting no attention at all.   It’s something I speculated about in an early book – Shadow Warfare – wondering if something so obvious and so “retro” could possibly work. As it turns out the answer is “yes” and Putin is playing that track far better than the U.S. did when it drove the Soviet Union bankrupt.  Basically the strategy is to spend so much on advanced weapons systems that the opponent extends themselves financially – with the Soviet Union it led to system collapse. Of course it was tremendously expensive for America in the earlier Cold War.

Putin saw that as a KGB officer and he understands the drill.  Worse, he knows how to do it more efficiently.  The thing to do is to a) focus your propaganda on the most expensive and terrifying part of your military – nuclear weapons, b) announce sensational new weapons and spend some to develop them but not the huge amounts to bring them operational and c) project your threat into new venues with as little expense as possible.

At present Putin and his military are four years into touting nuclear exchanges as a standard tactical option, they have announced and are working on doomsday weapons which make no sense at all, and they have one of their anti-satellite weapons maneuvering in the vicinity of one of our largest and most capable intelligence collection satellites – clearly we need a brand new service with all its administrative overheads, go Space Command. Note: Russia operates all its air, missile and space activities under one unified command.

The result is that we are starting on a massive and horrendously upgrade of our entire strategic nuclear capability (why we still need 4,000 megaton class weapons is another question, only answered by the response that Russians have that many…sigh).  The Congressional Budget Office has estimated the first 10 years of the modernization plan will cost nearly $500 billion – over a 30-year span the total would hit $1.2 trillion, including the cost of sustaining the current and future force. Add that to the now trillion dollar budget deficit and you have some real numbers.

The program includes a new missile to replace the current Minuteman 3 ICBM, a new-generation Columbia-class ballistic missile submarine fleet, and a new long-range bomber (the B-21 Raider) to replace the B-2 stealth bomber while retaining the older B-52 bomber as a bulk weapons carrier. The B-52, which entered service in the 1960s, is getting new engines and other major upgrades. In his 2021 defense budget proposal to Congress, Trump requested $2.8 billion for the Raider bomber and $1.5 billion for the new-generation ICBM.

In all, the administration’s proposed nuclear weapons budget for 2021 would approach $46 billion, divided between the Defense Department, which is responsible for operating the weapons, and the Energy Department, which maintains the warhead stockpile. You will find more information on all this at the links below:

Bottom line, Putin wages a two track political warfare program, fragmenting and destabilizing the American public while multiplying the trauma with intense economic pain.

The Cold Warriors of the 20th Century would be in awe.

8 responses »

  1. AnthonyM says:


    Yet again a fascinating blog (or at least we seem to have similar interests!).

    This could be an essay, but I’ll break it up into smaller elements over time (as I have work to be getting on with!).

    In terms of Russian cyber and other psychological warfare operations against the USA, the situation is quite staggering in that we seem to have a POTUS who is reacting to this by attempting to bring the intelligence community more completely under his control to stop discussion of it rather than facing up to it and dealing with it. The nomination of Mr Grennell as NDI was a real ‘sit up and take notice’ moment for me. Whilst there have been other NDI in the past with a political background (Coates) or diplomatic background (Negroponte) rather than coming up through senior intelligence or military roles, Mr Grennell seems remarkably unqualified for the job in any normal sense. As I understand it his background is as a political adviser, communications director (for the USA’s UN Ambassador) and private sector PR roles, followed by the basically ceremonial ambassador role in Germany. At first sight you and I are probably more qualified for the job than he is!

    Add in his support for alt-right groups in Europe and I have to conclude that he is being appointed because he is a political operator and PR person loyal to President Trump personally with the intention of stopping any discussion of Russian actions from the intelligence agencies.

    The whole subject of the ‘exorbitant privilege’ of the dollar, the foundations on which that is built and it’s role in sustaining US ‘hard power’ and achieving US foreign policy objectives is a fascinating question and the extent to which a trillion dollar deficit can become and two, three or ten trillion dollar deficit is a key question…I think it might well be possible for the USA to keep this going for a long time but with some clear risks. I’ll come back to that later but for now I’ll just comment on how quite a lot of media coverage of military matters in recent years has reminded me of the ‘missile gap’ circa 1960…lots of sightly alarmist coverage of Chinese hypersonic weapons and Russian doomsday devices. Whilst some of these technical developments are real and, for example hypersonic weaponry has significant implications, this tends not to provide a balanced context of US developments …all great for pushing up procurement budgets and share prices….


  2. larryjoe2 says:

    Certainly I agree with all your points (we must have the same interests) and its sort of amazing that the current new weapons race in hypersonics is chewing up so much time and money with so little actual demonstration of technology,. As you point out its very much like the missile race – and clearly illustrated the concept of “mirroring”, you do it because they are doing it and they do it more because you are doing it and …

    If there were any sanity involved the US and Russia would be sitting back down to put a limit on atomic stockpiles (which Trump claims to want based on the expanse involved) but instead the US position is that China needs to be included….that would be nice but China has no comparable stockpile – actually if the US and Russia could step down to where the Chinese are it would be progress (China’s defense spending is large but very focused and very pragmatic – which certainly is not true for either Russia or the US).

    Beyond that what would make even greater sense would be tripartite negotiations on hy personic weapons – which are a huge problem becasue they do represent a preemptive strike capability and that can leads to some very bad decision making in regard to first strike dialogs.

    To spike the conversation a bit more, take a look at these links if anyone things I was being to harsh on the administration in its Senate majority – their opposition to legislation to fight election interference is appalling.

    As for Space Command (which as a space nut myself I would like to love), its leasing us right back into the budget trap of unfunded mandates and supplemental budget items – the same trap we fell into with our wars in Iraq and Afghanistan. There is simply no fiscal excuse for this..

  3. AnthonyM says:

    Thanks for those links. I hadn’t picked up on the specific proposals about protecting the election process that have got blocked…hadn’t seen that reported over here in the UK. Very worrying as this could end up with some of the more ‘lunatic’ elements disputing the result if it’s close in November.

  4. larryjoe2 says:

    Actually its not getting that much coverage either, the Senate is getting a real pass on its lack of action. The American media has become so obsessed with micro-reporting on the upcoming election that other factual news such as this just gets lost in the noise. Perhaps even more surprising is that the Democratic candidates have become so mired down in competing with each other and on policy issues that very practical issues of both security and budget get little visibility. The budget battles and deficit growth that are very much real time issues are largely out of sight.

  5. AnthonyM says:

    The sustainability of the dollar system part 1

    I think I must have hit a character limit on this before…a second go. Health warning…I am not a trained economist so this is just my current impressions.


    The question as to if the US twin deficits (budget and trade) are sustainable in the longer term is a critical question and depends on the extent to which the ‘exorbitant privilege’ of the dollar can be sustained indefinitely. This depends on the extent to which other countries, organisations, companies and individuals with surpluses continue to purchase US Treasuries at the necessary rate.

    John Connally (yes, that John Connally) was one the main architects of the current dollar system as Nixon’s Treasury Secretary as the previous Bretton Woods system failed. The full details are quite involved but in essence the USA utilises the reserve currency status of the dollar to channel global surpluses into the dollar to maintain positive capital inflows to fund the budget and trade deficits. One element was a deal with the House of Saud that oil sales would be priced in dollars in return for security. Hence the USA is locked into supporting Saudi Arabia in the Middle East. Maintaining the system depends on a wide range of factors:
    • The dollar is used in most commodity trades globally, not just oil but the petrodollar is
    an important element. Sovereign debt is often denominated in dollars.
    • Strong legal protections for property and money.
    • Deep financial markets with the prospect of good returns on investments.

    No other reserve currency has the same strengths, not even the Euro due to the idiotic structure adopted by the EU in which there is a single currency without full monetary and fiscal union. The Chinese Yuan (Remnimbi) doesn’t come close in terms of legal context and depth of markets etc.

    The global pre-eminence of the dollar has allowed the US to weaponise the dollar (e.g. the response of Europe to the Iranian situation). Getting shut out the US controlled financial system would be catastrophic.

    The demise of this system has been long predicted but it has survived for half century and continues going strong. The closest call was the 2008 financial crash which literally paralysed the global financial system until vast amounts of new money was injected into the system to keep it going.

    So… the question is if there are any limits to the scale of the US budget and trade deficits that would not be balanced by capital inflows from surplus countries in the future?


  6. larryjoe2 says:

    I certainly don’t have the background to comment specifically on this (only one course in micro economics and one in macroeconomics..grin). But as to the basic question of sustainability, it seems to me a matter of investment options. As long as American growth and income generation justifies foreign investment then its sustainable. Its a matter of options. The real risk is that if you start delaying payments or hit a bump in growth, things go bad really quickly. When your debt starts impacting your payments, your credit card gets cancelled…but even before that you have a debt ceiling from any prudent creditor/finance source. I’m guessing the same simple facts are in play in regard to your topic. There has to be a sustainability calculation, I just have no idea what that would be or exactly how its calculated

  7. AnthonyM says:


    I’ve been having trouble getting a second section the budget deficit to upload…it might be too long or it might not like the various links, so I’ll try to be brief and leave out links…

    You are right to highlight the importance of at least the prospect of financial returns in securing purchases of Treasury bonds, but there are some other angles that have allowed the USA to run up deficits that no other country could possibly sustain. In particular the dollar’s role as the default currency in most commodity markets (e.g. the petrodollar) means there is huge demand for dollars from that. The denomination of a lot of national debt in dollars creates huge risks for everyone else apart from the US and again generates a demand for dollars.

    In terms of risks…
    There was a recent warning from a advisory group to the US Treasury that the scale of increase in the deficit that is projected over the next decade is so large that meeting it would distort the global pattern of capital investments significantly (if it could actually be achieved).

    There are other straws in the wind. China used to be a big purchaser of Treasuries and still has over a trillion dollars in reserves (out total fx reserves above three trillion dollars in terms of value). There has been a recent trend of a slow reduction in Chines dollar holdings and a trend to diversification (I wish I could get the links into this…). This has included gold purchases by China (and also by Russia) of a sufficient scale to distort the market.

    Some analysts suggest the increase in gold holdings is linked to providing support to the ‘petroyuan’. In 2018 China moved to begin purchasing some oil in Yuan and whilst it is early days on this there are indications of an increase in this, particularly with Russia and, possibly, via the grey market, with Iran.

    At the moment other Asian countries have filled the gap and the US is funding its deficits quite happily, but the move to the petroyuan represents a fundamental potential threat to the petrodollar and I think it is no surprise that the bipartisan shift in attitude to China coincided with the start of developments toward the Petroyuan. People who have tried to price oil in anything other than dollars (Saddam Hussain, Gadaffi) have tended to end up dead, although China will be a much tougher nut for the US to crack.

    A longer term threat to the petrodollar element of this comes from ‘peak oil’. If global demand for oil declines this will undermine one of the main engines driving demand for dollars and potentially force some large oil producers (perhaps particularly Saudi Arabia) to begin to sell off dollar holdings. That would weaken the dollars, forcing higher interest rates to offset it (but I mention again the sheer scale of the deficit that will need funding by around 2030).

    Many other countries (including European ones) see the dollar system as a fundemental threat now, given the way it being used for hard power projection (e.g. Iranian sanctions) and there is talk of alternative payment systems to get away from the US controlled SWIFT…unlikely as that too would make whoever does it a major target, except for the countries who already are targets (China, Russian, Iran, Venezuela etc.).

    So…no immediate systemic risk to US ability to fund its military BUT, unless there is a gradual change of direction in ten years time it may be becoming difficult to sustain the sheer scale of capital flows needed, particular if demand for dollars in the oil trade declines. Just like Bretton Woods, things may well creak along for a while before some major event(s) (like Vietnam in that case) push things over the edge, which would not be pretty.

    So, yes, it is a major long term threat. Fixing it would require a Kennedy like approach to reaching a negotiated settlement with China (and to some extent Russia) whilst the US is in a very strong position. Then utilise that window to reduce military spending and to begin to rebalance the budget gradually which would require tax increases on major corporations and the wealthy. I don’t see it happening as it’s not in the short term personal interests of the individuals and corporations who own the USA, but let’s see what happens in November…

  8. larryjoe2 says:

    I quite agree that “subjective” factors beyond what those a “prudent investor (sorry, I enjoyed a few years working in the financial industry and came to love some of its term…grin) would normally consider. You have outlined them well and of course our own policies at present totally ignore them. Right now we are really good at ignoring things, not a good sign in itself.

    Because we are unable to face our financial limitations we will become mired in a huge four way political budgetary battle between entitlements/health care/ infrastructure and the military. And because of our history (and the strange strategic concept that we not only have to ensure ourselves against preemptive attack but build our military to fight one or two major adversaries and a minor adversary at the same time) we are unable to focus like Russian and China can, actually using their much smaller military investment as a tactical took rather as compared to our much larger spending level which simply can never be large enough to support that strategic assumption.

    Nothing like a cheerful outlook….

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