As Michael Hudson and I have pointed out several times, Russia can finance her own development by creating rubles. By bringing in foreign money, Russia loses income flows from the development. Moreover, when income from the investments are paid to foreign owners, the rubles exchanged in the currency market for the foreign investors home currencies can put pressure on the Ruble’s value.
Mirable dictu! PCR is getting it, apparently by way of Michael Hudson.
Paul Craig Roberts-Institute for Political Economy
Russia Doesn’t Need Foreign Investment
Paul Craig Roberts | formerly Assistant Secretary of the Treasury for Economic Policy, associate editor of the Wall Street Journal and a columnist for Business Week, Scripps Howard News Service, and Creators Syndicate
This is funny. Back when I had my podcast, I had Paul Craig Roberts on as a guest. And we got into an argument about Reagan "bankrupting" the Soviet Union because Reagan forced higher defense spending on the Soviet Union which they couldn't afford. I said, "Really? They have a closed system that is financed with their own currency. How could we have bankrupted them?" We got into a heated argument and he said he would never do another podcast again. And now he's saying the exact opposite--in effect, what I said. Unbelievable.
ReplyDeleteMike, to be fair you can "bankrupt" a country in terms of resources, forcing it do dedicate more and more of its human resources in activities detrimental to the good of the nation, so we are not talking in financial terms but physical terms.
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