No, you heard it right. Last week in a Fox News appearance, South Carolina Sen. Lindsey Graham said outright that the war in Ukraine is “about money.”
Namely, Graham told Fox News host Sean Hannity that the U.S. stands to financially gain from Ukraine’s vast agricultural sector and “two to seven trillion dollars’ worth” of rare earth minerals alike in a prospective wartime deal with the war-torn, albeit resource-wealthy, nation.
“This war is about money. People don’t talk much about it. But you know, the richest country in all of Europe for rare earth minerals is Ukraine. Two to seven trillion dollars’ worth of minerals that are rare earth minerals, very relevant to the 21st century,” Graham declared. “Ukraine’s ready to do a deal with us, not the Russians. So it’s in our interest to make sure that Russia doesn’t take over the place.”
“[Ukraine] is the bread basket of…the developing world,” Graham mused. “Fifty percent of all the food going to Africa comes from Ukraine.”
Graham also emphasized that the incoming Trump administration is uniquely positioned to cash out on such resources. “Donald Trump is going to do a deal to get our money back, to enrich ourselves with rare earth minerals. A good deal for Ukraine and us,” Graham said. “And he’s going to bring peace.”
Trump has suggested repeatedly that he wants to bring all sides to the table to talk in order to end the war. Graham has been consistently on the other side of the debate where he has wanted Ukraine to keep fighting at all costs.
Yet Graham insists that Ukraine will benefit from the prospective “deal” he describes. His own history of hawkish comments, where he previously said that “with American weapons and money, Ukraine will fight Russia to the last Ukrainian,” suggests Ukrainians' best interests and meaningful peace both rank low amongst his priorities.
Notably, this isn’t the first time Graham has suggested that the U.S. could benefit from access to Ukraine’s natural resources. “[Ukrainians are] sitting on a trillion dollars’ worth of minerals that could be good to our economy,” Graham said in a video clip from September, where he was standing next to Ukrainian President Volodymyr Zelensky.
Meanwhile, war fatalities continue to mount, with the Wall Street Journal reporting in September that over a million people have died or been wounded in the Russia-Ukraine war since its inception. To hawks like Graham, such fatalities seem to be an acceptable price to pay in an apparent bid for Ukraine’s natural resources.
Stavroula Pabst is a reporter for Responsible Statecraft.
Top image credit: U.S. Senator Lindsey Graham (R-SC) attends a news briefing amid Russia's attack on Ukraine, in Kyiv, Ukraine March 18, 2024. REUTERS/Gleb Garanich
Top photo image: Key Square Group founder Scott Bessent speaks at a campaign event for Republican presidential nominee and former U.S. President Donald Trump in Asheville, North Carolina, U.S. August 14, 2024. REUTERS/Jonathan Drake
Late Friday, president-elect Donald Trump announced his pick for Treasury Secretary, Scott Bessent. The announcement had taken a longer time than other appointments, suggesting a period of extended infighting within the coalition on economic policies and personnel.
According to reports, opposition to Bessent was centered on the idea that he was insufficiently committed to Trump’s proposal to hike tariffs to 50-60% on all imports from China and to 10-20% on imports from all other countries. On the other hand, he was the candidate most favored by the financial markets, a consideration that may have prevailed at the end, reflecting a presidential disposition to treat the performance of the stock market as a report card.
Trump’s announcement naming Bessent describes him as “one of the world’s foremost international investors and geopolitical strategists.” And indeed, the appointee is a very well-known practitioner of “Global Macro” investing. The term describes a strategy that involves big bets on the direction not just of stocks, but also of currencies, interest rates, bond yields, and commodity prices — all assets affected not just by economic and financial factors, but also by the interaction of national and global politics.
Trump also said the Bessent pick would help America “fortify [its] position as the World’s leading Economy, Center of Innovation and Entrepreneurialism, Destination for Capital, while always, and without question, maintaining the U.S. Dollar as the Reserve Currency of the World.” This might seem a self-evident reason for the appointment, but at least part of the appointment letter is at odds with a position taken by J.D. Vance.
The V.P.-elect has been skeptical that the American people benefit from their country issuing the global reserve currency, implying that this leads to dollar strength that makes imports too cheap in America, and exports from here too expensive. In an exchange with Fed Chair Jay Powell in March 2023, Vance said, “in some ways you can argue that the reserve currency status is a massive subsidy to American consumers but a massive tax on American producers.”
But Bessent views the centrality of the dollar as an asset. His opinions are embedded in a broader world-view that dovetails with many of geopolitical D.C.’s preoccupations over the last decade.
For example, in an article commemorating former Japanese PM Shinzo Abe written in fall 2022, Bessent noted that “President Trump’s most enduring achievement may have been to wake the United States and the world to the growing dangers of an ever-more-antagonistic China. In response, Abe’s greatest foreign policy achievement was taking this awakening and developing a multilateral solution for containment.” He also worries that “Abe’s construction of an Indo-Pacific alliance is likely to be tested in the near future as China defines a new status quo with its relationship with Taiwan.”
And in an illuminating interviewconducted just this fall, Bessent goes into greater detail (beginning at around 30 minutes) about how the U.S. should make use of its combination of three huge assets — military strength, financial preeminence, and sheer market size — as usable tools along a spectrum that runs from cooperation through suasion to outright coercion.
He plays with the idea of a stratification of tariff levels (green, yellow, red) based on adherence to American values and interests, invoking a hypothetical reminder to India of the risks it might run by buying Russian oil. He suggests that countries that benefit from the American defense umbrella return the favor by buying long-maturity U.S. debt of 30 or 40 years, “paying upfront” for what they receive.
Bessent then welcomes the fact that the centrality of the dollar in the international monetary system allows America to use its power of sanctions extraterritorially (against entities outside its borders) to influence or punish their behavior. And finally he talks about the potential to use tariffs against China not to push regime change but rather to force it to change an economic model based on investing and exporting too much and consuming too little.
Now, these were obviously off the cuff remarks in a single interview, but if nothing else they reveal both a great deal of thought and a significant commonality with long-prevalent instincts in Washington, many of which are shared by Trump (and the current Biden national security team). There is a clear attachment to American primacy, even if expressed in a nuanced and thoughtful manner that privileges economic and financial tools to ensure the same over purely military ones.
Time will tell, but it seems the U.S. might now have a Treasury Secretary whose own inclinations and understanding of the complex linkages across finance, politics, and economics make him less wedded to restraint than his near predecessors.
At the same time, the tools at his disposal (and an implicit mandate from the White House to protect asset markets) may make him more restrained than his peers in other cabinet posts.
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Top photo credit: Russia's President Vladimir Putin and North Korea's leader Kim Jong Un ride an Aurus car in Pyongyang, North Korea in this image released by the Korean Central News Agency June 20, 2024. KCNA via REUTERS
Over the past decade, China has grown increasingly concerned about its waning leverage over North Korea and inability to restrain Pyongyang’s nuclear ambitions.
These worries have only intensified with North Korea’s dramatic tightening of ties with Russia this year. In June, Kim Jong-un and Vladimir Putin signed a new alliance treaty pledging mutual military assistance in the event of “aggression” against either country. In October, Pyongyang sent troops to Russia to join the fight against Ukraine, building on months of weapons and ammunition shipments it had been providing to Moscow since August 2023.
The Chinese government has not openly commented on North Korea’s new alliance with Russia or its military support in Ukraine. It is likely, however, that discussions about China’s loss of initiative in its triangular relationship with North Korea and Russia are heating up in Beijing.
For seasoned diplomats and historians, the revival of the North Korea-Russia military alliance presents a major risk to regional stability in Northeast Asia. It also raises an intriguing question: Has China been played by Pyongyang and Moscow — for a second time since the outbreak of the Korean War in June 1950?
The Korean War was hardly in Mao Zedong’s plans just one year after establishing the People’s Republic of China (PRC). Historical records show that Mao and the new PRC leadership had a clear priority: reunifying Taiwan with mainland China and not pursuing Kim Il-sung’s ambitions on the Korean Peninsula. Both Mao and Kim sought Stalin’s backing, and the Soviet leader ultimately chose to support Pyongyang’s agenda over Beijing’s.
Bitter at Mao’s hesitation, Kim concealed his war preparations from Beijing. Only three days after launching his attack on South Korea did Kim finally inform Chinese leaders about the conflict.
An outraged Mao fumed, “They are our next-door neighbors, but they did not even consult with us before they started the war. They have not notified us until now.” Yet when Kim’s forces faced defeat by U.S. troops after the Inchon Landing in September 1950, Mao felt he had no choice but to rescue North Korea by entering a war that Kim and Stalin had effectively forced upon him.
Whether today’s Chinese leadership feels similarly betrayed by North Korea’s military alliance with Russia remains unclear. Like his grandfather in 1950, Kim Jong-un has shown little regard for China’s interests in his pivot to Putin.
China’s passive response to both Pyongyang and Moscow is particularly striking given Beijing’s position as the strongest power in this triangle. Unlike Mao’s era, today’s Chinese leadership needs no blessing from Putin for its strategic decisions. And the revolutionary bonds between Beijing and Pyongyang that once linked Mao and Kim Il-sung have long since dissolved.
As analysts often note, Putin’s grinding war in Ukraine has reduced Russia to a junior partner — if not a supplicant — in its relationship with China, unlike 1950 when the Soviet Union decisively outmatched China in every measure of hard power. North Korea, meanwhile, remains deeply dependent on China economically, relying on Beijing for 90% of its trade and the bulk of its energy imports throughout the post-Cold War era.
Some structural features are nevertheless similar, making the Korean War a useful analogy for China’s current predicament with North Korea and Russia. In 1950, Northeast Asia crystallized into two opposing camps: a Soviet Union-China-North Korea bloc facing off against a U.S.-Japan-South Korea alliance. Kim Il-sung secured Stalin’s support for his unification plan precisely because of this stark military and ideological divide.
Today, Northeast Asia teeters once again on the edge of bipolar confrontation. While U.S.-China relations bear little resemblance to the early Cold War era, their steady deterioration since the first Trump presidency has created an opening that Pyongyang and Moscow eagerly exploit. Both capitals grasp China’s deep aversion to a new Cold War with the United States, yet calculate that escalating U.S.-China tensions have made Beijing increasingly eager to maintain their allegiance.
This pressure intensifies given China’s deep historical ties and vital security interests in both countries. Stable relations with Moscow and Pyongyang remain critical for Beijing to secure its sprawling 2,672-mile Russian border and 882-mile North Korean frontier.
This dynamic has constricted China’s strategic options while expanding room for maneuver by Moscow and Pyongyang. Both capitals now sense an opening to leverage Beijing’s growing fear of isolation in its contest with Washington.
Thus emerged China’s “no limits” partnership with Russia, its studied “neutrality” on Ukraine, and its quiet acceptance of the Russia-North Korea alliance — despite the latter’s troubling implications for Beijing’s own ties with Pyongyang. Though China’s 1961 military alliance treaty with North Korea technically remains in force, Beijing has carefully avoided any public reference to North Korea as an ally.
The Korean War analogy, like all historical analogies, has its limits. Despite some structural echoes, today’s power dynamics are fundamentally different. Most crucially, China now holds decisive power advantages over both Russia and North Korea — making Beijing’s passive stance all the more perplexing. Its failure to shape events stems not from weakness but from an apparent reluctance to leverage its strength. Beijing seems almost hesitant to challenge Putin or Kim, revealing a curious diplomatic timidity where assertiveness would better serve its interests.
Beijing’s passive posture may stem from a deeply rooted strategic culture that begins by analyzing broad structural trends (xingshi). No prudent strategist can ignore such constraints, but this preoccupation often breeds overcautious, reactive policies. Such defensive thinking leaves China vulnerable to the bold opportunism of North Korea and Russia.
Chinese policymakers are right to worry about losing leverage over North Korea and Russia. The obvious remedy is to exercise greater initiative by wielding China’s considerable power more decisively. Mao showed remarkable initiative as a leader, but in the case of North Korea policy, Deng Xiaoping offers a more relevant model for today’s challenges.
In December 1985, Deng charted a new course on North Korea: “We should draw lessons from our dealings with North Korea. We should not give the North Koreans the wrong impression that whatever they ask for we will give them.” He was unflinching: “Of course, the North Koreans are unhappy. Let it be. We should prevent them from dragging us into trouble.”
China today must heed the lessons of its reactive, risk-averse stance toward North Korea. Despite its commanding position, Beijing has surrendered the initiative. The question remains: Why does China play such a weak hand from a position of strength?
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Top image credit: 240809-N-NH911-1219 PACIFIC OCEAN (Aug. 9, 2024) Abraham Lincoln Carrier Strike Group and Cavour Carrier Strike Group sail in formation. ... (U.S. Navy photo by Mass Communication Specialist Seaman Apprentice Daniel Kimmelman)
The U.S. must retrench for the sake of its own security, but there are many domestic political obstacles that make retrenchment practically impossible under current conditions. The status quo strategy of military primacy is too deeply entrenched and there are too many established interests committed to its preservation.
To change that, there needs to be a major overhaul of America’s domestic political system and its foreign policy, and neither can succeed without the other. That is the heart of Peter Harris’ case for reform in his excellent new book, “Why America Can’t Retrench (And How It Might).”
It is essential reading for advocates of foreign policy restraint.
The first half of the book details how the U.S. adopted a strategy of military primacy and how that strategy transformed the country. Harris defines military primacy as “a grand strategy of maintaining and exploiting America’s military advantages over global and regional competitors, with a view to leveraging these structural advantages in service of favorable political and economic outcomes.”
America’s current strategy of primacy is not only ill-suited to an increasingly multipolar world, but it also represents a serious threat to the security of our country by putting the United States on potential collision course with great power rivals. As Harris puts it, “Even if it is accepted that primacy made some sense during the so-called ‘unipolar moment’…it cannot be argued that the same unilateralist policies are suited to a world that can punch back.”
The U.S. needs a less ambitious and dangerous strategy, and to get to it the U.S. needs retrenchment. Retrenchment is simply “the reduction of overseas forces and security obligations.”
While Harris is interested in scaling back America’s military footprint, he makes clear that he believes that U.S. international engagement in every other respect should continue and, in some cases, intensify. The foreign policy agenda he spells out in the final chapter is what he calls “internationalism anew” with an emphasis on increased peaceful American engagement with the rest of the world. Even as the U.S. military pulls back from its forward-deployed positions, the U.S. would remain very much involved in global affairs.
The obstacles to reform and retrenchment are considerable. Any system that has been in place for 80 years would be difficult to alter. The “militarist redoubt,” as Harris sometimes refers to it, is going to be unusually difficult to overcome. Arguments for retrenchment do not get anything like a fair hearing in the current system because, as Harris shows, the “US political system is designed to reject them.”
The institutions of the national security state exist to implement a strategy of primacy, and that has created entrenched interests in Washington and across the country hostile to any major overhauls. Bureaucrats working in the government, local communities benefiting from military spending, and ideologues wishing to use U.S. power to advance their agendas are all likely to resist any significant changes to the existing strategy. As Harris tells us, “Simply put, programmatic attempts at retrenchment are doomed to failure in the present context because there are too many Americans who profit from militarism, who regard primacy as a means of promoting their values abroad, or who would be across-the-board retrenchment as an assault on their sense of national identity.”
Harris’ analysis of the barriers to changing U.S. foreign policy can seem disheartening at first, but he is not counseling despair. He points out that “informed and analytical description can be a clarion call to evaluate the status quo when otherwise it might have gone unchallenged or even unnoticed.” If advocates of restraint are to make any headway in changing how the U.S. operates in the world, it is critical to have a clear view of the steep and treacherous climb ahead of us.
The proposals for domestic renewal in the book may seem overly ambitious, but they will have to be if they are going to produce the kind of sweeping changes to our political system and foreign policy that need to be made. Among other things, Harris suggests significant changes in our elections and our party system, including moving towards a system of proportional representation.
He calls for Congress to reassert itself in matters of war and to claw back powers from the national security state. Harris also recommends expanding both houses of Congress to make elected officials more responsive to their constituents, and he suggests granting statehood to U.S. territories or incorporating them into existing states so that they are fully represented in the government.
A grand strategy of restraint is Harris’ preferred alternative, but it is worth noting that the political and policy reforms that he wants to see would open up American foreign policy debate. As he says, the “goal is not to replace America’s primacist cartel with a restraint-oriented counterpart, but to imagine a more pluralistic environment within which the American people might be exposed to a wider range of ideas about foreign policy.”
Harris envisions a more inclusive and democratic political system that would also make it possible for the U.S. to retrench.
The U.S. is endangered by the current strategy of primacy. Indeed, Harris says that current strategy is a “recipe for conflict with China.” Primacy makes the U.S. less secure by design, and it “heightens the risks of the United States sleepwalking into a disastrous confrontation with a great-power rival.” To avoid that calamity, the U.S. needs to retrench, and in order to retrench it must reform itself at home.
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