Why not launch emergency production programs to produce surpluses of the products that Putin’s war is making so expensive?
In historical terms, the Russian Putin’s invasion of Ukraine evokes Adolf Hitler’s annexation of Czechoslovakia in 1938. The argument put forward by the invaders is similar in both episodes: the existence of significant contingents of compatriots in the spaces in dispute. But the true motivation –barely concealed– is the ambition to obtain territories to expand their respective empire. Seize the territories and, of course, the natural wealth they contain. In 1938, the reaction of Western democracies led to a ridiculous piece of paper with a false promise of “peace for our times”. Currently, it is the imposition of punitive economic sanctions on Russia by the invasive Putin.
At the time, the negotiation with Hitler that led to the annexation of Czechoslovakia was seen in Mexico as something totally remote that did not concern us. The vision was highly myopic and time would prove it. Currently, the conflict in Ukraine has caused a cataract of upward pressures on the Mexican economy that impact as exogenous shocks. But there is not even a glimpse on the part of the Mexican authorities of a reaction program not only to face these inflationary impacts from abroad, nor a possible response to take advantage of them. Question posed by naïve: in view of the upward spirals in wheat and corn that the conflict in Ukraine is causing and in energy prices, wouldn’t it be convenient to launch emergency production programs to produce a surplus of products that the war that Putin triggered is getting so expensive?
Two things are crystal clear about the ongoing conflict in Ukraine. The first is that the economic sanctions decreed by the Western powers are not going to stop Putin from his expansionist ambitions through military means. The second is that although these sanctions will cause the Russian economy great damage in the form of lost Gross Domestic Product (GDP), they will not affect the despot Putin in the slightest in terms of his personal well-being.
Western powers have to think of ways to truly harm Putin individually. For example, it is known that he is immensely rich and possibly also that an important part of his fortune is invested abroad. Why not try to threaten the integrity of that surely ill-gotten fortune?
Columnist
economic debate