Retired U.S. General Ben Hodges warned that the world needs to prepare for the collapse of the Russian Federation “as we know it” within four to five years. Hodges claims that sanctions, military losses, and corruption are factors likely to cause the failure of Russian energy and arms exports, which represent central parts of the Russian economy, setting the foundation for a potential Russian balkanization.
Analyst Comments: Hodges is the former commander of U.S. Army Europe, and played a key role in the Defense Department’s boost in forward deployments to the region. The Russian economy is set for another set of challenges once the latest sanctions on the oil and gas sector go into effect in December. Earlier, we reported that Putin ordered a “restructuring” of the Russian economy to mitigate the effects of sanctions, although he didn’t provide specifics, and restructuring will take years or decades that Hodges believes Russia doesn’t have. Former Navy admiral James Stavridis noted this week that Russia’s weakened position makes Putin more dangerous. Stavridis and Hodges both represent the mainstream U.S. defense insider view that Russia will be pushed to the verge of collapse. My first counter is that China, India, and other countries have a vested interest in keeping Russia stable. China especially has ramped up both imports and exports with Russia and could potentially do more to send Russia a lifeline. My second counterpoint is that while Russian cash reserves have fallen, Russia has relatively low national debt, and debt-to-GDP was just 18.2% last year. That, of course, will increase as the Russian economy shrinks, but Russia is already in the process of reworking its 2023 budget, which should be finalized next month. Putin earlier this week gave a quick economic speech in a conference call with his national economic staff who are preparing for the downturn. My guess is that Russia is able to hang on, although I do believe internal pressure is growing against Putin.
Treasury Continues to Wage War Against Russia
U.S. officials are targeting Turkey in the ongoing fight against Russian finances. Treasury officials are warning at least five of Turkey’s largest banks connected to Russia’s Mir international payments system that they could be at risk of sanctions evasion violations. Deputy Treasury Secretary Wally Adeyemo traveled to Turkey in June to meet with financial institutions on illicit Russian financing.
by vtgothic 
