Streetwise Professor

The Iranians are losing their water lately.  With impending sanctions already imposing acute strains on the Iranian economy–as evidenced by the sharp decline in the Iranian rial–and with their primary ally in the Middle East–Syria–tottering from domestic insurrection, the Iranian regime is engaged in a lot of chest thumping: firing off missiles, holding maneuvers to practice shutting the Straits of Hormuz, etc. Sort of like North Korea, only with kabob instead of kimchee.  (Or maybe kookoo!)

Today’s Iranian icky thump was to warn the US Navy not to send the carrier Stennis back through the Straits.

Well, chess was supposedly invented in Iran, but they apparently forgot how to play if this is any indication.

There is no way the US can cave to this threat.  And there is no way the Iranians can back it up.

The Iranians are always announcing this miracle weapon and that, but if you follow it you’ll know that said miracle weapons are almost always one-off prototypes that never make it to serial production, and even those that are produced are usually farcical stitch-up jobs (like the “new” domestic fighter that is a warmed over F-5 design that was obsolete in the early 1970s).

The Iranians should probably consider a little local history.  Like in 1981 and 1989, when Khadafy tried to enforce his declaration of sovereignty over the Gulf of Sidra by sending aircraft to intercept US F-14s from American carriers that Reagan had sent into the Gulf in response to Khadafy’s declaration.   The result kinda sucked for 4 Libyan pilots. Two Su-22s were splashed in ’81, and 2 Mig-23s bought it in ’89.

The Iranians have less air capability than the Libyans did 30 years ago, and the US Navy has substantially more on a single carrier than it did then.  Do the math.

Or even closer to home, during Operation Praying Mantis in 1988, the US Navy smacked around the Iranians after an Iranian mine holed a US destroyer (the Samuel Roberts).  Again, the mismatch in capability has only grown.

So watch the Stennis cruise right back through the straits, and watch the Iranians stomp their little feet.  For if they try to do more than that, the results will not be pretty–for them.

The only suspense is how long it will take RoPaul to leap to the Iranian’s defense. He has already declared that sanctions are an act of war, and that Iran’s quest for nukes is A-OK because without them they are like Rodney Dangerfield, and get no respect.

Since he’s a little involved in Iowa today, my entry into the RoPaul Iran Water Carrier Pool is  4 January 2012.

And in the irony department, Zero Hedge and Infowars are flipping out because they can’t get updates on the positions of US carrier battle groups from Stratfor (h/t R). I guess the US Navy is now Anonymous.

In closing a little reminder of why I wouldn’t want my “leadership” making threats, if I were an Iranian pilot:

Vladimir Putin declared that Russia is an island of stability.  Really:

Prime Minister Vladimir Putin said Russia’s economy is an “island of stability” amid the turbulence in the global markets and as he seeks another term as president.

“The world’s economy hasn’t calmed from turbulence,” Putin said in a New Year message broadcast on state television. “In this sense Russia is notably an island of stability — in any case for now.”

Gee.  Let me think.  When was the last time that the Russian government promoted the “island of stability” theme?  Think. Think. Think.

Oh, I remember now!  It was 2008, when the US and European financial crises were swelling and then cresting.  Kudrin used the phrase in January, 2008, right when the major cracks were beginning to appear in US and European financial markets.  Putin used the phrase at the Valdai event–in September, 2008. You know, the month of Fannie & Freddie, AIG, and Lehman.

We all know how that worked out.  The “island of stability” turned into a latter-day Atlantis in 2008-2009, and went further underwater than any other major economy.

The reason for that was clear: Russia is a high beta economy, dependent on natural resource exports that are acutely sensitive to world economic activity.  So if Europe or the US have problems, Russian problems will be worse.

Nothing has really changed.  Russia is still dependent on natural resources, particularly oil.  Budget wise, in fact, Russia is even more dependent on oil prices, requiring a price north of $95/bbl, substantially higher than in 2008.

This is not to say that the EU or the US will implode, or that China will.  These are very real possibilities, rather than certainties.  But the point is if these places turn out to be stable, Russia will be economically stable–relatively speaking.  If these points are not economically stable, however, Russian will definitely not be.

Putin’s attempt to distinguish Russsia’s economic fate from that of Europe, or the US, or China, is fundamentally flawed.  Contrary to Putin’s assertions, Russia cannot decouple from the world economy: Russia will not–cannot–be a refuge from world economic storms.  It is actually the worst place to be at that time.  Sort of like standing under a tall tree during a thunderstorm.

But we know that if, heaven forfend, that if another world crisis occurs, that Putin will rage at the injustice of it all, blame the West and the US.  He’s nothing if not predictable.

But it is quite revealing that Putin is apparently so unoriginal that he can only fall back on old propaganda to advance his new campaign, particularly inasmuch as that propaganda was proved to be farcically, tragically wrong.  Perhaps it shows the fundamental economic bankruptcy of Putinism.  He can’t advocate real change because that would be a mortal threat to the natural state, and the boodle that he and the rest of the elite pack away.  So he can only tout stability–stasis.  He has to do so even though that makes him repeat drivel that didn’t survive contact with reality the last time he said it.  He better hope reality doesn’t intrude again.