Trade in War
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The paradox of countries trading with each other while at war has sparked a lively debate, with commenters delving into the complex dynamics at play. At the heart of the discussion is the notion that while states may be at odds, it's often individuals and companies that drive trade, with their interests not always aligning with those of their governments. Some commenters argue that governments can manipulate these interests through incentives, tariffs, and other means, while others point out that the interests of states are not monolithic and can be influenced by corruption and corporatocracy. As the conversation unfolds, a nuanced understanding emerges: trade during wartime is a multifaceted phenomenon, with various factors at play, from substitution and tariffs to the blurred lines between national and individual interests.
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Read the primary article or dive into the live Hacker News thread when you're ready.
Though keep in mind that it might be states being at war with each other, it's usually (but not always) individuals or companies that are trading.
The interests almost never align.
Btw, the interest of states aren't monolithic either, they are made of people after all. (That's why corruption can happen in the first place.)
The country as its citizens does not profit from war. The country as its leaders sometimes it does, or at least it may do so in the short term.
[Edit] Ha! Didn't see you were the GGP. I got your point, even if I am an unobservant idiot.
With the government of the day making exceptions as they feel fit
When they do: https://en.wikipedia.org/wiki/Corporatocracy
But it's much more than that I think: when the stuff you sell to the other side can easily be substituted, from another supplier, domestically or by changing to ways that get by without, where's the benefit of stopping trade? Those 0.5% the other supplier has been more expensive (if it even is, might very well have just been inertia keeping them buying from you) won't meaningfully harm their war effort.
What's not normal is trying to use tarrifs the way the US is, and the frequency of their adjustment, as well as stated motivation (punitive rather then achieving any sort of strategic goal).
Can't really comment on "more expensive = higher quality" since I'm biased towards France where I believe they're better at cultivating tomatoes than the Swiss.
If you do internal subsidies (the EU/US approach) instead of tariffs on imports, then a fraction of your taxes gets diverted to farmers instead.
Sadly this whole issue is difficult to side-step completely because if you do neither subsidies nor tariffs, your local food industry just dies and that is a really undesirable outcome if you want to avoid famines.
If Switzerland opened to EU competition then they would’ve seen multi store farming like in Netherlands. Subsidies would fare better.
https://www.thetimes.com/travel/inspiration/ski-holiday/endl...
It's a complicated one, but legally it's a civil contract; if the Ukrainian government decided to stop the gas flowing, both Gazprom and all the companies "downstream" would be in their rights to sue for breach of contract and/or causing gas shortages, costing the Ukrainian government billions.
And you could wonder why they signed the contract anyway given Russia invaded/annexed Crimea 5 years prior, but, it's a lot of money, and at the time it was still considered a civil contract I presume.
Btw, occupying the moral high ground even when it has a cost, sends a strong signal that you will also be trustworthy in the future, and not just when it's convenient.
Ie sometimes the cost is the point.
Just like the peacock's fancy tail needs to be biologically expensive to work.
The Ukraine needed (and continues to need) support from the buyers of that gas - the EU
The war has been going long enough, and the Ukrainian government would have made it very clear that thy would not be renewing the contract.. meaning that the EU had a chance to get their energy via some other route.
I'd imagine the logic goes something like Ukraine believes they are benefiting and Russia is too, but they aren't sure which side is gaining more from the movement of gas through Ukraine (which, note, in real terms is supporting the economies that are arming Ukraine). In that situation, the obvious thing to do is just let things play out as contracted. If it was obvious that Russia was gaining a lot more from the deal than they are then they'd just stop.
Ultimately the general public is capricious in its beliefs: cutting the gas off and causing energy prices to spike in Europe means someone will call for the head of whoever's nearest to blame.
Ukraine also was deliberately not targeting Russian oil assets earlier at the request of the US for economic reasons - though I'd say recent American political history shows what a mistake that is.
There's been a change in the administration (and therefore strategy) of the USA, which changed the way the game was being played.
I think that (almost) everyone that has actual skin in that particular game also knows that none of the agreements that any of them make are reliable for a long term (I saw recently that the Ukranians gave up the Nukes they had at the behest of the US government, and on the.. I don't know if it was explicit, implicit, or just assumed.. understanding that the USA would provide some sort of security guarantee (which, of course, has never materialised)
They also had about as much latitude to keep those nukes as Germany would. Some people act like Ukraine owned and controlled the nukes and had a meaningful choice. They never did.
It wasnt given security guarantees either, it was given a promise that its independence wouldnt be infringed upon in a memorandum (not in a treaty).
As the Americans stated themselves in 2013 when they violated their promises within the Budapest memorandum, that memorandum wasnt legally binding. It was treated like toilet paper first by the Americans in 2014 and subsequently the Russians in 2014.
Whereas try collecting a debt from a nuclear power who's uninterested in paying it.
There was absolutely no way for Ukraine to keep the nukes, not only because both the West and the East/Russia were against it but more importantly, the powers that be in Ukraine had other plans.
Also, I wouldn't comment on a fait accompli unless doing so pointed to information important for understanding today's realities.
Tell it to the people caterwauling about the budapest memorandum, not me.
>it's extremely obvious that handing back the Soviet nukes they had possession of was a mistake.
It's the furthest possible thing from obvious. Ukraine couldn't maintain the weapons and was in desperate need of economic assistance it would never have gotten if it kept the nukes.
Moreover, if they tried to keep them Russia would likely just have taken them or rendered them unusable by force and we likely would have supported that.
[0]: https://cisac.fsi.stanford.edu/news/budapest-memorandum-myth...
>Absent the 1994 agreements, many seem to believe Ukraine could have maintained a nuclear arsenal. In fact, it would have encountered likely insurmountable challenges.
Here is where the Americans said "look, this memorandum isn't even legally binding" while they also try to pretend they didn't violate it:
https://web.archive.org/web/20140419030507/http://minsk.usem...
I find this fascinating: the US is a net oil exporter so 'as a country' would benefit from higher oil prices.
But it seems in the US your average Joe who tops up his car at the petrol station has more political power than the oil industry.
Pretty much. A common absurdity is politicians railing against Big Oil for causing climate change while simultaneously promising to lower gas prices.
Or putting / upholding tariffs on imports of solar panels.
It seems completely morally bankrupt... If instead of Russia it was ISIS, would they still send money just so they have cheap gas? Like at what point would they stop? Do the Russians need to be impaling babies and goosestepping through Red Square?
I also don't understand why Ukrainians don't feel a deep sense of betrayal about this
Because the alternative isn't buying gas from somewhere else, it's not buying the gas. This turns a foreign war into a major major domestic issue.
I don't really understand the psychology of it. Are people for instance actively trying to use less gas in their personal lives?
I am generally against arms deliveries, especially to Israel and Russia.
Sanctions should above all be effective. Russia is difficult to sanction especially if China and India do not play along.
The energy sanctions hurt Germany more than Russia, so I don't support them.
Specifically, I heat with gas in winter and try to reduce my consumption.
Might have something to do with Russia orchestrated terrorist attack agains Czech munition warehouses that killed two people in 2014[0].
Or the Soviet invasion of Czechoslovakia in 1968[1] - just because the local communist leaders happened to be a bit too much enlightened for their tastes.
Just a few days ago I went past memorial plague for the girl killed in protests against the Soviet invasion in 1969[2][3] - forever 18 years old...
There were lots of flowers, people still remember.
[0] https://en.m.wikipedia.org/wiki/2014_Vrb%C4%9Btice_ammunitio...
[1] https://en.m.wikipedia.org/wiki/Warsaw_Pact_invasion_of_Czec...
[2] https://cs.m.wikipedia.org/wiki/Danu%C5%A1e_Muzik%C3%A1%C5%9...
[3] https://encyklopedie.brna.cz/home-mmb/?acc=profil-osobnosti&...
The irony is that the US slaps higher tariffs on most European countries than it does on Russia itself. As the old saying goes, "it may be dangerous to be America’s enemy, but to be America’s friend is fatal".
1. https://ofac.treasury.gov/media/930201/download
2. https://www.govinfo.gov/app/details/PLAW-117publ110
3. https://www.cbp.gov/trade/programs-administration/entry-summ...
4. https://media.bis.gov//about-bis/bis-leadership-and-offices/...
5. https://www.federalregister.gov/documents/2022/03/15/2022-05...
6. https://ofac.treasury.gov/faqs/1024
7. https://www.cbp.gov/newsroom/national-media-release/cbp-fact...
8. https://ustr.gov/about-us/policy-offices/press-office/press-...
[1]: https://valvesector.com/lng-ships-and-storage-wars-how-europ...
Morality has nothing to do with it, no democratic government will survive freezing its own people for some abstract principle.
They are (arguably) playing for themselves first.
Actual EU action in this conflict has been pretty well aligned with citizen/voter interests in my opinion; this is not strictly a good thing, you could uncharitably call it "emergent unprincipled EU hypocrisy".
Many voters want energy safety, inflation to be kept in check and to minimize spending on foreign conflicts and national defense. Lots of Europeans agree with keeping Russian expansionism in check, but they don't really want to pay for it nor risk escalation.
Generally, sacrificing trade for ethical/moral reasons sounds like an easy sacrifice to make, but this comes at a real price (getting overtaken by "immoral" nations that don't, possibly ending with ethically worse global situations in the long term), and things like this get fierce opposition in a democracy where you have to balance ideology with the economical well-being of your voters (ideological voting is much more achievable if you can at least pretend that it aligns with economical self-interest somewhat).
To me, EU feet dragging in the Ukraine war is a bit sad but unsurprising.
Morality wise, I'd say several middle-eastern petro-states are significantly worse than Russia (non-democratic government, human rights violations at large scale epsecially against foreign workers), and trade with those has been going on for decades...
But yeah, it is not great look for democracies when they can't support good causes because it will cause harm domestically which leads to less votes.
https://www.reuters.com/business/energy/us-russian-officials...
And wants to control Russian gas to the EU:
https://www.reuters.com/business/energy/us-investors-eye-str...
Nord Stream has been sabotaged, a huge US LNG deal was forced on the EU in the tariff negotiations. The US leased a corridor from Azerbaijan through Armenia to Turkey that could be a new energy choke point for fossil fuels from Azerbaijan or Turkmenistan (lots of natural gas) to the EU.
The EU is in a pretty bad position right now where it can be blackmailed with energy cutoffs not by Russia but by the US.
The Ukrainians can't feel betrayal because they have kept their own transit pipeline open until 2025, long after Nord Stream was blown up (allegedly by Ukrainians on a sail boat, see the recent arrests).
It wasn't really, as the EU have no ability to make member states do basically anything around energy, so that clause accomplishes basically nothing.
Europe can’t defend Ukraine by destroying itself.
Guess what happened with the pumping stations once the last reasonable countries stopped importing & the transfer contracts were no longer valid. Yes, boom.
And of course there was much wailing from those corrupted countries that did nothing to get ridd themselves from dependency on Russian energy - how very expected.
It's nigh on incomprehensible when political leaders' actions contradict their words, since politicians are always truthful. It seemingly happens often but will remain forever a mystery.
Switching it off on one end would require storing it somewhere at the source and switching it off on the other could destroy the actual piping. You can't just "take" it from one and easily transfer it to another customer.
AFAIK it's the engineering but that other comment about neighhbors in Dubai is yeah
2) Because this gas was needed in Europe.
I would go as far as to say that if there is any peace in Ukraine within the next few years then Ukraine will probably demand that if any gas goes from Russia to Europe it would go through Ukraine.
Sadly war means western countries will keep printing money, while also funding the military industrial complex. For some, this is a goal.
I can see why that happens, but are there any good counterexamples? Are there any conflicts that actually were as short as the initiating party expected?
It's the same thing that decides when wars end. Either side is free to surrender or withdraw at any point in a war. They continue fighting when they think that the result they can obtain (win or lose) in the future will be better than the result they can obtain in the present. They stop fighting when that no longer becomes the case, at least assuming non-insane leadership.
War isn't the end of relations. It's not infrequent that enemies today are allies tomorrow, or vice versa. Nobody ever knows what tomorrow holds, and history seems to love a nice plot twist.
However - for older nations, especially european ones, war is another tool in the chest of diplomacy, and may not be viewed as 'all encompassing'. To understand that war is just another lever of power can help Americans make better sense of conflicts.
During WWII, one of Hitler's higher ranking underlings let the Allies know that they could spare the lives of a large number of Hungarian persons bound for the death camps in exchange for trucks shipped through Spain, approximately 1 truck for each 10 lives saved, but that offer drew no genuine response.
A reminder that not long ago this was a functioning institution of higher learning.
Big companies like to lobby governments into creating problems for which they have solutions to sell.
I mean just look at what happened with companies like Mercedes Benz and Hugo Boss which were selling tanks and uniforms to the Nazi government... Still very successful today, didn't even change their names. They didn't have any problems finding customers or investors. Clearly it means that nobody who matters economically cared about the war. Quite remarkable when you realize that we're talking about WW2. In the business world, it's as if WW2 didn't happen.
At one point islamic state (or one of the similar groups) had either ownership of a few oil fields, or transit between them, and were actively trading petro chemicals with each other for a good while.