An experiment in concision.
Brexit returns, with PM Theresa May announcing a deal with the EU this week. The compromise pleases no one: too restrictive for the Brexiteers, too divisive for the Remainers. UK members of parliament will vote on the deal on December 11th, and it looks unlikely to pass, challenging May’s leadership. May has stated it’s her deal or no deal, and the EU has been clear that this is as far as they were willing to go.
If no deal is approved by March 29th, Britain faces a cliff. Flights will be grounded, ships stopped in port, agricultural products wasted, citizens stranded. British MPs from across the political spectrum have introduced a bill to state unequivocally that they do not support May’s deal, and that a no-deal exit is unacceptable. This sounds nice, but unless they can come to an agreement the EU likes, they won’t have much to say come April.
On to Ukraine. In 2014, Russia invaded Ukraine, but swore it wasn’t them. Early this year, the Trump admin sent weapons to Ukraine to help deter further Russian aggression. Fat lot of good that did — the Russians just fired on and seized three Ukrainian ships in the Sea of Azov.
Why? Russia wants to exert influence in the region, and what better way to do that than to choke off Ukraine by cutting off the body of water through which 80% of their exports travel? Why now? Two reasons, besides the usual use of foreign affairs to distract the restless Russian populace: first, remember how Ukraine’s Orthodox Church wants independence and how that would be a huge blow to Russian legitimacy? Yeah. And second, Ukrainian pro-Western Petro Poroshenko is up for reelection in March, and Putin wants to screw with him — though that could backfire.
Poroshenko has asked for NATO to respond, since this is like, their ONE job. Other than pirates. Unless they do, this is likely to be swallowed, just like Crimea and election meddling and attempted assassination plots. If you want to stop this, you have to stand up to it. This might seem counter to my previous assessment that we should not have armed Ukraine in 2014. The caveat is, if you want to stand up, you have to be all in. You want to stop Russia from invading Ukraine? Get ready to go to war in Ukraine. There are no easy outs, no simple solutions that don’t entail risk.
Finally, the G20. Down in Buenos Aires, leaders from the 20 biggest economies are gathering, today and tomorrow, to discuss the globalism and the like. The highlight? Presidents Trump and Xi, of the US and China respectively, are meant to meet face-to-face for the first time since last spring, and the first time since Trump launched his trade war this summer.
Will there be a resolution to the conflict? Given the rhetoric coming out of preliminary meetings, the two still seem oceans apart. Trump has stated that if no deal is reached, come January 1st, our tariffs on Chinese goods will rise from 10 to 25%.
If the leaders walk away with nothing, it will be a bad day for the markets. Really bad. There will definitely not be a comprehensive deal this weekend, so the conflict is likely to continue. But no sign of cooperation would seriously damage business confidence.
Xi is likely to arrive with something to offer, as the trade war trashes the already-unstable Chinese economy. The question is whether it will be enough to get Trump to put the trade war on hiatus. Trump loves a deal — it would play as a coup for him, and we saw how little it takes for Trump to declare victory in the North Korea deal — but that’s a good story for 2020, not right now, and he might love punishing China more. #fpf