Streetwise Professor

October 8, 2007

Cocaine [Oil] Blues

Filed under: Energy,Military,Politics,Russia — The Professor @ 8:44 am

Examining Figure 2 from this article on the Russian energy economy by Gaddy reminds me of the old Johnny Cash song “Cocaine Blues”:

Early one mornin’ while makin’ the rounds
I took a shot of cocaine and I shot my woman down
I went right home and I went to bed
I stuck that lovin’ .44 beneath my head

Got up next mornin’ and I grabbed that gun
Took a shot of cocaine and away I run
Made a good run but I ran too slow
They overtook me down in Juarez, Mexico

The graph depicts Gaddy’s estimates of the energy rents accruing to the Soviet–and Russian–economy. Each of the two spikes in the graph corresponds to a period of Soviet/Russian adventurism. The first shot of oil/cocaine during the 1970s oil shock fueled Soviet aggressiveness around the world. The second oil/cocaine shot–the post-2003 runup in oil prices–is powering Putin’s recent revanchism.

The thing about cocaine is that what goes up, comes down with crash. After that shot, you feel invincible, but the comedown is brutal and depressing. That’s what happened to Willy Lee, and what’s likely to happen to Putin–or his successor, if there is one–when oil prices come down, as they inevitably will.

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5 Comments »

  1. […] a year ago, in “Cocaine [Oil] Blues,” I wrote: The thing about cocaine is that what goes up, comes down with crash. After that […]

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  2. […] October, 2007, I wrote a post titled “Cocaine Blues” in which I noted the association between oil prices, and Soviet/Russian […]

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  5. […] on oil prices, a dependence which has wreaked havoc on his grandiose plans in the past: the cocaine blues phenomenon. ┬áConditions are quite bullish now, but there are many factors-continuing European economic […]

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