Russia invaded Ukraine, and the destruction, cruelty and devastation of the war shocked the world. The West has imposed sanctions on Russia with increasing intensity, and the Russian Central Bank has also been targeted. The Russian economy and people’s livelihood have been severely damaged, and millions of people in Ukraine have been displaced and turned into war refugees.
The scale of the war cannot be compared to that of World War II, but a large number of comments after the war point to echoes of history, echoes of time and space, and various similarities between “past and present”, from street fighting styles, weapons to historical evolution And the background of the times, and so on.
There is one similarity that is not much talked about – in the eyes of economists, the parallels between the current Ukrainian war and the Second World War are actually not superficial, but deeper.
“Major financial crises and wars are both symptoms of a deeper structural problem in society – underlying tectonic movements that create these cracks on the surface,” Palan wrote.
BBC senior correspondent Allan Little (Allan Little) commented that the Russian-Ukrainian war was actually a struggle between “Yalta” and “Helsinki”, or, in other words, a struggle between democracy and authoritarian regimes.
1929-39 – the battle of the four models
The 1929 financial crisis was a historical turning point in the evolution of capitalism in the late 19th and early 20th centuries, a major outbreak following a series of small-scale financial panics. In the wake of the crisis, four different solutions emerged, each representing the industrial model on which each is based.
“World War II was arguably a giant battle between four industrial modes, each of which offered its own solution to the problem,” Palan said.
- Great Britain – an attempt to rebuild the pre-World War I British-centred imperial economy in which Ukraine and Russia were responsible for providing food;
- Soviet Union – Stalin rejected Britain’s efforts to pull the Soviet Union into the international business system, implemented a planned economy, and the state organized industrial production;
- Germany – National socialist policy makers devised and implemented a hybrid model: a semi-planned economy with nationalization of key industries and trade unions, but the basic system is capitalism;
- United States – Roosevelt’s “New Deal,” which combined nationalized public utilities, defense, education, and pension systems with a “planned corporate economy” controlled by large conglomerates, based on private property rights and democracy.
These four solutions were put into practice, and they went round and round for 10 years, and finally met and killed each other on the battlefield of World War II in 1939. The world was turned upside down, Germany and its allies were defeated in 1945, and the American model prevailed.
In the following decades, a new world pattern has been gradually established and stabilized, and the trend of globalization has grown stronger day by day. The deepening degree of globalization and the confrontation between winners and losers and various contradictions have made it questionable, and it has become what Palan called “the consciousness of today.” At the heart of the battle of forms”.
2008-2022 – The battle for the future of capitalism
Like World War II, in Palan’s view, the root cause of the current war is the 2008 financial crisis, which undermined the market capitalist economic model that dominated the world driven by Europe and the United States after World War II.
After the war, the neoliberal economy advocated by Europe and the United States has dominated the world for decades. The free market economy and democratic political system have been promoted as two sides of the coin to voters and the world. The inviolability of private property and the free combination of consumer choice are dominated by multinational corporations. The free market,” said Pallan, the major beneficiaries of globalization, as measured by business, tax and debt.
“Orthodox” capitalism began to appear in “variants” by the late 20th century:
- The Russian model – state-led capitalism: After the collapse of the Soviet Union and the economy devastated by a devastating “shock therapy”, this solution became the basis for Putin’s prestige appeal to consolidate power. This late 20th century form of capitalism shares some of the theoretical foundations of the neoliberal economy.
- China Model – Market Economy Controlled by the Communist Party: A market economy with Chinese characteristics, with market elements, coexistence of state and private ownership, and regime over capital.
- The Gulf Model – Authoritarian Capitalism: The country is open to private business and investment capital, but the main body of the economy remains in the hands of a few chiefs and ruling families.
Going into the 21st century, these capitalist “variants” ostensibly continued to rise for the first 10 years, but the 2008 financial crisis eroded everyone’s belief in the market’s ability to solve problems, as well as confidence in the political class and democracy itself, In contrast, China, Russia or some kind of Western populist proposition seems attractive and is considered by many to represent the future.
The financial crisis has brought a lot of changes to the world. Governments’ quantitative easing bailouts, zero interest rates and fiscal tightening to reduce the damage caused by the crisis have come at a high cost, especially as inflation and the general disparity between the rich and the poor have increased, providing the basis for populism, extreme Thought trends and social unrest laid the groundwork.
“Helsinki” vs “Yalta”
From the perspective of political and historical scholars, the Ukrainian war is a war between a democratic regime and an autocratic regime, a war between two opposing ideas, and involves the maintenance of the norms of international relations.
Timothy Garton Ash, a scholar at Oxford University, said that these two worldviews can be expressed in two words – Helsinki and Yalta.
In Yalta in 1945, Stalin, Roosevelt, and Churchill divided postwar Europe into “spheres of influence”—with much of Eastern Europe belonging to the Soviet Union and the West to a transatlantic alliance that would set out to rebuild Europe’s democracies.
Helsinki describes a Europe made up of independent sovereign states, each free to choose its own alliance. It grew out of the Helsinki Final Act of 1975 and gradually evolved into the Organization for Security and Cooperation in Europe.
Defenders of Ukraine are fighting for “Helsinki”. Putin has dispatched the army to force a modern version of Yalta – which would stifle Ukraine’s independence and bring it under Russian rule.
Thus, the Russian invasion of Ukraine is also seen by political economists as a proxy war between authoritarian and liberal capitalism.
How to win or lose the Russian-Ukrainian war
BBC senior reporter Allen Little (Allen Little) analyzed that Russia’s invasion of Ukraine, NATO’s eastward expansion and the long-standing insecurity (a flat river, no natural security barrier) are one of the main reasons, but with the United States and Europe The Western sanctions, headed by them, effectively divide the world, “equivalent to erecting a new economic iron curtain that separates Russia from the West.”
He pointed out that Russia has been highly integrated into the global economy, the world depends on its oil and natural gas, and its industry depends on imported products and components. If Russia is excluded from the rich world and the global economic and trade circle, Russia and its people will be hit hard, and so will the world.
“We’re all affected by this,” Little said. “It could lead to a setback in the globalized economy that emerged after the end of the Cold War.”
To a large extent, the direction of the situation depends on how China responds to this new world situation. China and Russia have rallied against American power, with Beijing and Moscow convinced that the greatest threat comes from a rejuvenated, more unified democratic world.
China does not want to see Putin weakened, or the West consolidated. However, this is exactly the effect of the war in Ukraine.
China and the Gulf states, as well as emerging economies such as India and South America, represent what Palan calls a “variant of capitalism.”
Putin’s war could redraw the international financial landscape.
Oxford scholar Ash believes that the West has been too half-hearted in defending Helsinki’s values in the “Helsinki” and “Yalta” debate – it formally recognized Ukraine’s right to join NATO at a future date, but never intended to achieve this. a goal. And Putin also has his negligence and carelessness.
Palan argues that Russia’s invasion of Ukraine can also be seen as a “proxy war for the future of capitalism.”
“Unless and until the West actually restructures capitalism, such as designing a 2020s version of the New Deal, similar proxy wars may continue to break out on new battlefields,” he asserted.
About Ukraine:
Ukraine is located in Eastern Europe, between Russia and EU/NATO members Poland, Slovakia, Hungary and Romania, bordering Belarus to the north and Moldova to the south. Crucially, Ukraine shares a border with Russia.
Ukraine used to be part of the former Soviet Union, and after the collapse of the Soviet Union in 1991, it became two independent countries like Russia. But as a former Soviet republic, Ukraine has deep social, cultural and economic ties with Russia.
Ukrainian is the only official language of independent Ukraine. However, until recently, most urban centers and industrial areas were mainly in Russian, with Ukrainian speaking only in the far west. This began to change as we entered the 21st century, with more young people learning Ukrainian in the formal education system.
Russia’s 2014 occupation of Crimea was the first time a European country has annexed another country’s territory since World War II. Despite the Russian government’s denials, in the Donbas region near the Russian border, there are Russian “volunteers” and regular troops in two self-proclaimed pro-Russian “people’s republics”.
Ukraine before the 20th century
Birth of Ukraine – Around the 9th century, a group of northern Europeans entered what is now northwestern Russia, conquered the local East Slavic tribes, and then migrated along the Dnieper River to present-day Kyiv, the capital of today’s Ukraine. The medieval city-state was historically known as Kievan Rus. Central Ukraine is today the center of the Rus state.
Moscow was born in the 12th century. In 988, Archduke Frodimer accepted Christianity from Byzantium. The various East Slavic dialects they spoke later evolved into Ukrainian, Belarusian and Russian.
The Principality of Rus was conquered by the Mongol Empire in the 13th century. After the decline of the Mongol Empire in the 14th century, the Grand Duchy of Moscow and the Grand Duchy of Lithuania carved up the land of the Rus Duchy. The Grand Duchy of Lithuania was later merged with Poland. On the southern border of Poland, a new Ukrainian Cossack community began to emerge. The Ukrainian Cossacks were a large group of free men, many of them runaway serfs; they guarded the southern Polish steppe borders against Turkish and Tatar attacks.
In the 17th century, the Cossack rebellion against Polish rule turned into a massive social and religious war that culminated in the establishment of the Emirate – a nominally self-governing but de facto independent Cossack regime under the Polish king. In the process, Cossack rebels opposed to Polish Catholic rule accepted the “protection” of the Orthodox Russian tsar.
The connotation and extension of this “protection” are still debated by historians.
In 1764, Catherine II (1729-96) abolished the emirate in an attempt to wipe out the last remnants of Ukrainian autonomy, and Russian troops destroyed the Cossack stronghold on the Dnieper. Cossack officers could claim their nobility—the Empire agreed to accept them as equals with Russian nobility, as long as they provided the relevant paperwork—but Ukrainian peasants ended up enslaved.
In the 18th century, during the conquest of Poland by Tsarist Russia, the trend of national revival in Ukraine began to rise, and the movement of national revival moved from Poland to the former Rus Principality, the westernmost part of the Austro-Hungarian Empire. The Russian authorities promoted cultural assimilation, enacting the Ames Act of 1876, which banned all Ukrainian-language publications.