Trump in #Warsaw: You Forgot About #Poland, Part 2

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Full text and video of Donald J. Trump's July 6, 2017 speech in Warsaw, Poland here

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Back to the Polish-Lithuanian Commonwealth Future?

Back in January 2016, the Russian Analyst looked back on our travels in Poland over a decade earlier, and looked at how the Central European country is headed 'back to the future' toward regaining some of the regional influence it lost during its partition at the end of the 18th century. Our optimistic take on Poland's 21st century prospects was tempered by our recognition that the Poles traditional fear and loathing of their larger neighbor Russia could create an opening for Washington to exploit in ways costly to the Polish people. A year and a half has passed and what's interesting about our essay 'You Forgot About Poland' is how little the strategic situation has changed, even as the Poles elected a conservative nationalist government that has faced accusations of authoritarianism from the usual globalist suspects like George Soros.

Failing Exploitative and Globalist Economics, Not Warfare, Will Determine the Fate of the Ukraine

While we did not write about any imminent change in the borders drawn in blood during and immediately after World War II in that corner of Europe, we did hint at the gradual Polonization of western Ukrainians, as they obtain 'bez visa' travel into their European Union member neighbor. In fact, one might say the reassertion of Polish influence in what many nationalists still regard as the old Kresy borderlands of Galicia, Volynia and western Belarus is a dialectical counterpart to de-industrialized, Russian speaking eastern Ukraine's gradual emptying out via emigration into the Russian Federation. In both cases the traditional imperial centers that ruled left and right bank Ukraiana (which translates as 'borderland') along the Dnieper and other historic dividing lines are re-asserting themselves,  but through postmodern and economic rather than direct military means.

Notwithstanding the Donbass war dragging into its third year of interminable 'ceasefires' marked by nightly shelling, neither the so-called Russian 'vacationers' nor the alleged Polish mercenaries or volunteers fighting on the Ukrainian government's side have pushed the trenches more than a few hundred meters beyond the spring 2015 front lines after Kiev's defeat in the Debaltsevo cauldron. If change is to come to Ukraine, it will come in the form of the failing post-Maidan state's gradual depopulation in favor of its two most economically and militarily powerful neighbors, and age old rulers in the old Polish Lithuanian Commonwealth and 'Muscovy'.

Why Poland and Its Visegrad Bloc Allies Will Economically Dominate Western Ukraine -- As Their Forebears Did Centuries Ago in the Polish Lithuanian and Hapsburg Empires

Despite Ukraine being the largest state in continental Europe by landmass, the secession of Crimea and the Russian-backed breakaway city-statelets of Donetsk and Lugansk also being beyond Kiev's reach mean that it's likely that there are now fewer Ukrainians living on the territory of the former Ukrainian SSR still using Ukrainian passports than there are Poles living in Poland. This is a case study reversal from the situation on the eve of Ukraine's independence, in which there were 50 million Ukrainians in the Ukrainian SSR and only 38 million Poles in the Poland that elected its first post-Communist, Solidarity government. In 1990, the Ukrainian SSR was the richest per capita and most industrialized republic in the Soviet Union, with a GDP roughly equal to that of its socialist neighbor in Poland. Today Polish wages, themselves averaging about half of the German level, are between double and four times what salaries are offered for the same type of entry level to low-skilled labor in Ukraine.

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If post-2014 trends continue of Ukrainians fleeing their homeland due to lack of living wages in the glorious post-Maidan 'success story' that the U.S. and especially EU have promoted, Poland could easily surpass the 1931 census figure of 3.2 million Ukrainians living on its territory within five years -- that is in the early 2020s. After all, bez vis in Ukrainian might as well mean for millions 'looking for work', and Poland has been one of the easiest countries for Ukrainians to legally obtain temporary if not permanent status within the EU.

Middle to Low Wage Labor Markets and the Eastward Shift of European Manufacturing

Many Poles are well aware that just as millions of their young people went West looking for work in the 1990s and 2000s, taking advantage of the European Union's borderless Schengen zone to earn higher incomes in Germany, France, and the UK than at home, the Ukrainians now wish to emulate their success. Yet the economic headwinds in Europe are blowing much stronger against the Ukrainian hopefuls today than they were against the so-called 'Polish plumbers' of Great Britain ten years ago. Not only Poland, but also its Visegrad bloc neighbors the Czech Republic, Slovakia and Hungary are expecting a major Ukrainian influx in the next several months to years. Just as German firms quietly began to outsource major production in household appliances, automobiles, power tools and construction equipment to Czechia in the 1990s and early 2000s, so the Teutons Visegrad partners can now take advantage of some skilled workers willing to work for half to even a third  of the salaries of Prague or Budapest in Lvov and Uzhgorod (with much of that differential accounted for by the devaluation of the hyrvnia).

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However, as with Poland the supply of skilled young people is not limitless (particularly with a military draft still feeding young men into the 'ATO' meatgrinder), while the wages of unskilled and especially older and female workers fearing starvation-level pensions face remorseless downward pressure, particularly in low wage industries like household/hotel staffing and cleaning. Furthermore, the overall brain drain means that while there will be many success stories for the likes of Radio Free Europe/Liberty to highlight in Ukraine, there will also be many more young people who wonder why they should stay for such low wages if its remotely possible to earn more by emigrating a few hundred miles to the west.

The Bandera/UPA Cult of the Few Hijacking the Historic Memories of the Many:
A Simmering Source of Tension in Polish-Ukrainian Relations

To summarize, Ukraine is facing the same globalization on steroids pressures the Poles faced in the previous two decades, but without the honest governance, public trust and even social homogeneity (post WWII ethnically cleansed of its Germans and Ukrainians Poland is one of the most homogenous societies in Europe, with until recently the ethnic Polish percentage of the population in the high 90s) to endure it. The result is likely to be a 'success story' that involves nearly a third to even half of the 2013 population level being lost by the 2039 centennial of WWII.

While many Ukrainians who honestly stood for freedom on the Maidan looked to Poland as a model country, the reality is Kiev's promotion of the Bandera/UPA cult continues to be an irritant in Polish-Ukrainian relations. It's also a retrograde hindrance to the very cosmopolitan 'European'-ness the more U.S./EU friendly Ukrainian nationalists promote as their alleged antidote to Russia's evil and backward influence. The Ukrainian government's clumsy ban on the 2016 released historical Polish drama Volyn only highlighted Kiev's inability to square its glorification of the UPA with its narrative of Polish-Ukrainian brotherhood in the face of the common Russian threat.

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Trump and Bannon See an Opening, and Exploit It:
Washington Seeks to Make Berlin and Brussels Pay for Their Arrogance Towards 'New Europe'

Not coincidentally, given all the hardships and geoeconomic turmoil in their central European neighborhood, Poles have mixed feelings regarding their hard-obtained prosperity, and have increasingly embraced nationalistic populism in these uncertain times. Enter Donald J. Trump, and his aides like Steve Bannon, who through Breitbart News openly admired the Poles' strong stand against the EU bureaucrats threats of fines for refusing to take in Muslim refugees.

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The video of a young Polish man tearing up the EU flag in the Sjem (parliament) posted below went viral a few months ago, and while not representative of the adult majority, shows the feelings of an increasingly nationalistic trend among the youth. The EU is, while still striving to maintain its image as 'cool' and popular through propaganda outlets like EU Stratcom and the mass media, is viewed as a threat to the long term stability and health of its constituent nations by millions in Poland and in neighboring countries.

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Thus, the biggest import of Trump's visit to Warsaw ahead of the G20 was not the speech he gave, containing as it did some harsh words for Russia to please his hosts and fight the '#TrumpPutin bromance' agitprop of the Democrats and deep state back home. Rather, it was the White House's latest attempt to send a message to Angela Merkel and the bureaucrats in Brussels, that their writ regarding refugees or 'rapefugees' can be defied by an EU member state and staunch American ally, and that said ally can be rewarded for it with more NATO bases and other 'goodies'.

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The irony of such messaging is of course, that it represents more of a split within the Anglo-American elites rather than a sign of any sea change in policy. The alleged former Stasi agent Merkel has been a loyal vassal of the Democratic party-connected Deep State, even as she has criticized Trump's withdrawal from the Paris climate accord and smarts from The Donald's criticism of her radical open borders policy.

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Overly Expensive American LNG Sailing the Three Seas and Intermarium Pipe Dreams

The Three Seas Initiative, bringing together heads of state from the Baltic, Black and Adriatic Sea countries, in Russian eyes represents an effort to revive the interwar Polish doctrine of the Intermarium alliance (which some Ukrainian nationalists and neo-Nazi organizations like the notorious Azov battalion also promote as an alternative to the failing multi-culti cult of the EU). Trump's rhetoric about American liquefied natural gas (LNG) exports is also music to Polish ears, at least until they look at the price tag involved in shipping this cheap' fracked gas from the grossly over-leveraged Cheniere Energy's terminal in Louisiana across the Atlantic and Baltic Sea to a Polish port:

Cheniere’s rapid expansion has come at a terrifying cost, and the company is currently – as of fall 2016 – overleveraged with approximately $20 Billion in long-term debt. It is unprofitable, with interest payments representing 60% of revenues, the living embodiment of ‘bicycle economics’; the second you stop pedaling, you crash.

For what it’s worth, few great business breakthroughs have occurred without risk, and while Cheniere is plunging ahead with what seems like recklessness, it could just as easily pay off with complete domination of the North American export market. That’s a hell of a debt load, though; not much margin for bad news. That does expose a flaw in the American strategy, as well – wrestling control of the European supply market from Russia would be frighteningly expensive.

Consider; apart from the ruinous expense of constructing LNG terminals and processing facilities and getting planning and development permission (which I imagine could be shortcut pretty quickly if such a juicy prospect as seizing control of the European market seemed an achievable possibility), you need tankers to ship your product. The average LNG tanker which can dock at most terminals (remember, the tanker has to be able to get to the terminal as well as berth alongside it, so you may need to dredge a channel all the way through a shallow harbour) can hold a little better than 3 Billion Cubic Feet (BcF) of natural gas, which is mostly methane. That equates to about .85 Billion Cubic Meters (BcM). But Europe uses about 400 BcM per year. That would be more than a full tanker cargo every day, assuming LNG could supply the whole European market, which is of course unrealistic. Especially considering the entire global LNG shipping fleet consists of about 410 vessels.

No LNG carriers are currently registered under the US flag, and if the USA plans to be a serious exporter it is going to need about 100 new LNG carriers over the next 30 years, something which is frankly not practically achievable considering it takes about 2 years to build one, at a cost of about $200 Million apiece. Of course, miracles can be made to happen if you pour enough money into them. But we’ve already somewhat nervously mentioned how much all this is costing – how does the likely return on investment shape up?

Well, what the f---? Platts comes right out and says that Russia has the option of cutting its prices to ensure it undercuts LNG costs in order to keep its share of the European market!

“Russia clearly does have the option to undercut the US LNG price to ensure it keeps its share of its key European markets and could flood the market with cheap gas, maximizing revenues and cash flow at a time when producers worldwide are suffering from the impact of such low prices.”

So, let me get this straight. All the attempts by the west, led as usual by Washington, to force energy prices down and keep them low…actually benefit Russia by putting the USA in an unacceptable profit/loss loop so that it cannot afford to sell its LNG to Europe and still make money? That appears to be pretty much how it shakes out.

While the Visegrad alliance has endured the attacks of Soros, his media mouthpieces like The New York Times, and specious allegations of 'authoritarianism', it isn't clear if the Poles old Catholic partners the Austrians are so interested in paying through the nose for gas so long as Russia's cheaper, piped hydrocarbons are still flowing.

As German industrialists not only say nein but hell no to Washington's efforts to kill the Nordstream 2 project, Merkel's foreign minister Sigmar Gabriel has declared the new package of American sanctions targeting Russian gas exports to be unacceptable for Germany. Small wonder: when you look at the numbers cited by the Kremlin Stooge blogger Mark Chapman above, with plummeting natural gas production from the North Sea and stagnant to slowly declining output from Norway, the main rising competitor to Russian gas in Europe for the foreseeable future is Moscow's ally Iran. Without whose consent, the third biggest gas exporter in the world Qatar cannot pipe its hydrocarbons through Iraq and thence to Turkey and Europe -- though Qatar's extensive LNG terminals are, unlike the American ones, already built and permitted.

As The Sirius Report's London Paul plans to detail in an upcoming piece for his subscribers, the gas game has changed in Eurasia radically in favor of the Eastern powers, thanks in no small part to Obama and now Trump-inspired Saudi blunders. Moscow is now positioned with Tehran to create the gas cartel of the century with Doha, whose eastward tilt has accelerated thanks to Riyadh's ridiculously hypocritical charges of sponsoring terrorism and failed blockade.

A Good Reason to Remain Bullish on Poland:
The Three Seas Initiative Will Compliment European Portion of China's One Belt One Road

None of the above is to say, however, that simply because the mass import of American LNG to Europe will not work economically, that the Three Seas Initiative is a pipe dream -- quite the contrary! The Russian Analyst is bullish on Poland due to its positive demographic profile -- many Poles who earned degrees or wages abroad are returning from the likes of London to more affordable, family formation friendly locales. But that's not the only reason we like Poland for steady growth -- assuming that no insane clash is provoked on Russia's westernmost Baltic Sea-front border with the Poles in the Kaliningrad region -- there are many other things to like about Jack Posobiec and the #SlavRight's showcase country.

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Like the Czechs, the Poles smartly opted out of adopting the euro straitjacket and kept their own currency. Like their allies the Hungarians, the Poles have refused to take crap from Brussels and kept migrants prone to the dole and crime out of their country, letting more politically correct nations like Germany and Sweden take the lead in globalist virtue signaling and the subsequent crime waves. In the land of the blind the one eyed man is king -- Poland's debt to GDP ratio might not be as low as Russia's, but it's manageable compared to the piling up train wrecks of southern European and even French government debts. Like most of the Slavs, Poles keep their personal debts in check, and strongly support traditional values.

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Finally, IF it can accept that Russo-German partnership need not come at its expense, Poland is well situated to profit from the Antwerp/Rhine valley to Moscow Eurasian trade route and thence to western China One Belt/One Road mega project. Just as China is developing the Budapest to Piraeus railways and widening transport corridors through the Balkans, along comes a Visegrad project (Three Seas) whose infrastructure component quietly compliments rather than hinders Beijing's Central and Eastern European ambitions. Donald Trump did indeed, give a good speech, and PiS loyalists as well as some Polish-Americans chanting 'Trump!' put on a good show Thursday. Nonetheless, as we wrote before, 'Russia versus the West' is a scam -- much of what was called  'the West' as recently as the Reagan era no longer exists. The real story of Poland's prosperous 21st century is waiting to be written in the flow of trade to the East -- even as the remaining European men of the West look to old Warsaw's packed cathedrals with hope.

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