Geo-Political Hot Spots of 2009

| January 29, 2009

We are one month into 2009, and it is shaping up as one of the more dynamic years in my lifetime for geo-politics. As long as the economies around the world were expanding, everyone could be or pretend to be fat, dumb and happy.

How that the global flood of easy money has evaporated, many countries and trans-national entities are under extreme pressure. Some countries that relied on cheap exports or vast mineral wealth based their foreseeable future on the continued bonanza of the bubble economy. Countries that had been eccentric world players found the fortitude to take on positions that relied upon their dominance in oil or mineral wealth. They spent everything they had today, and everything they could ransom from the future, banking that the price of their oil, gold or copper would remain high forever.

Now reality is showing the folly of that approach. So we have a number of interesting things to watch during the first half of the Obama presidency. Lets have a look:

Russia – The ruble is in a free fall, with the Russian government fighting to protect it at every step. Russia went from a reasonable world player to having fantasies of restoring their old Soviet might and posture on the world stage. They aspired to restore their military platform to one capable of commanding fear or respect again. All of this was based on the myth of $120.00 / barrel oil, and a near unlimited global thirst for the product. Now with oil fighting to stay at $40.00, Russia finds itself lucky if it can keep the lights on, let alone dream of building new subs, tanks or planes. Make no mistake, Russia is under severe and growing stress from their population for the sorry and decaying state of Russia. Russia could become the next Iceland, where the entire banking system and currency collapse in a messy pile.

China – The most populous nation on earth had been enjoying the bubble more than any other developing nation. It’s entire economy revolved around cheaply producing goods for the rest of the world to consume. An entire industry sprang up to ship production whole to China’s expanding coastal cities. In response millions of young rural peasants migrated to the cities for an opportunity to work 12-16 hours a day in these factories. For these people, they saw a path to possible prosperity based on hard work and saving money (virtues Chinese culture have always praised). Sadly the real path to wealth was woven through the communist party, and those connected made vast money by controlling this business, and pocketing vast bribes and graft that were part of the game. Now China is facing a huge crisis. With it’s product and export economy no longer needed in a contracting world economy, it has millions of former rural people now wondering what to do for work. This mass of disenchanted people are headed back to the country side, where there is a good chance that we may see wide spread unrest from people who realize path to prosperity was a mirage, constructed to help exploit them. A revolution in China could be a massive and bloody afair. China is ripe for a democratic movement like the one in Tiananmen Square (1989).

UK – Of all the developed countries, the UK and the money men in London played the hardest and furthest in the global credit swindle. The rising tide of money they counted on to lubricate their way out of mistakes is gone, and will not be back in this lifetime. The UK is facing a future of crippling depression, soaring unemployment and a legacy of bad debt in the banking system that will likely take a decade or more to unwind. At the same time there is a growing sense in England that they have let their nation transform into something they no longer recognize and no longer like. Militant Islam has taken firm root in England, jobs are few and becoming fewer and money will be increasingly hard to come by. There is a great chance that the public will blame immigrants and Labour government for their problems, whether that is the case or not. With idiots like Lord Ahmed providing a very easy path for anger and accusation to flow into the large immigrant population in England.

Mexico – Perhaps the biggest threat to the US is not in the caves of Pakistan, but just on our southern border. Mexico is sliding into chaos as rampant corruption in the government mixes well with the increasingly para-military nature of the private armies around the wealthy families and the narcotics syndicates. Murders, kidnapping and even beheadings are becoming more frequent in Mexico, with multiple factions all attacking each other more or less at will without fear of prosecution. Any illusion that whatever happens in Mexico will stay in Mexico should be set aside now. The second largest population of Mexicans are here, in the US of A. This incumbent alien population includes both decent hard working folks, and a criminal element tied to the factions back in Mexico. Thus far the amount of fighting in the US has been minor, but should the worst come to pass, we could see violence spread to our country, likely starting in states with large Mexican populations such as California and Texas. Adding stress to this situation is the decrease of money being sent from immigrant workings in the US to their families in Mexico. This became so large that it was counted on by the Mexican government as a significant part of GDP. Like Russia, Mexico banked on their oil reserves being worth more than $100/barrel for the next decade or more, only to find that they can now count on less than half of that.

Iran – the ticking bomb on the world stage is the insane regime of Iran. Like Russia and Mexico, they are in big trouble due to the price of oil. But where the trouble will really come from is their nuclear program. While a nuclear proliferating Iran with it’s jihad allies is a massive threat to the US, it is a mortal danger to Israel. Many pundits expected the Israeli Air Force to being a campaign against facilities at Natanz, Arak, Esfahan and Bushehr just before President Obama took office. However no attack happened, and now everyone is left to wonder if Israel has the fortitude to defend itself. My expectations are that Israel will drop the hammer on Iran some time before the end of the year, and that there will be a massive global condemnation for taking action that all reasonable governments understand is necessary, but all lack the courage to take. Should Israel fail or be prevented from this operation, expect to see initial Iranian weapons tests towards the end of 2009 or early 2010. There are some indications that non-fueled “inert” tests are already being conducted based around a modified A.Q. Khan weapon design.

One thing is certain, with a rookie president at the helm, a growing isolationism trend in the US, and a zero qualification Secretary of State, we are likely to see some of the most dramatic events of our lifetime in the next year or two.

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Category: China, Credit Backlash, Geopolitics, Intelligence, Main, US Politics

About the Author ()

Bruce Henderson is a former Marine who focuses custom data mining and visualization technologies on the economy and other disasters.

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