Short version: The blackmailing of oil rich Saudi Arabia and other nations by the US
I’m going to against the grain of popular theory here and
come up with my own and say the evolution of fossil fuels
did not bode well for the Soviet Union, so bad luck really.
You see, your system can be much better than the other,
but if don’t have the resources and by resources I mean energy resources,
because they provide production and transport, if you don’t have those,
you’re out of luck.
if you look at when the GDP in the Soviet Union started to stall,
it’s around 1975, five years after the 1970 US oil peak,
causing the US economy to crash and spiral out of control,
while the Soviet Union and the Middle East was thriving.
The USSR had an enormous amount of oil like the US did before,
but the problem with oil is that it competes with coal and oil is more
easy to transport, so it’s more likely for oil to flow to
the country producing the most coal than the other way around.
Prior to the 1970s, the US was the largest oil producer in the world by
far and was thus exporting oil to the rest of the world.
Since they were also producing the most coal in the world,
oil was not a curse to them as electricity provides
the basis for working factories and thus industrialization.
Saudi Arabia, a nation with almost no resources whatsoever and zero coal,
had a very long way to develop itself.
The US then used Israel to start the Yom Kippur war, which it won.
And the US then sent a diplomat to Saudi Arabia and told them that
if they don’t want more trouble, they would do exactly as the US tells
them what to do which was:
Sell all your oil in US dollars only, no exceptions
Invest all your profits in the US only, no exceptions
If you make profits from those investments keep. You can do what you want with it.
In exchange, we will give you military protection from other nations.
This is the petrodollar scheme and it worked.
And it didn’t just work for Saudi Arabia,
but other middle eastern countries.
On top of that SWIFT was introduced around the same time.
This allowed the US to go into massive debt,
receiving enormous amounts of money for investment,
while the Soviet Union, whose growth was dependent on selling oil,
saw it’s currency rate fall.
And we’re seeing the same playbook happening right now again,
with different factors and therefore different effects.
This time China is the target, but it is producing the most coal in the world,
the most solar power in the world, the most wind power in the world,
and the most hydro power in the world.
A low currency rate for a country that mostly sells
manufactured goods instead profoundly different effect
compared to a nation that mostly relied on
the production and export of oil.
And even the situation in Russia and Iran are different from last century
as natural gas has strengthened both nations.
Short version: The blackmailing of oil rich Saudi Arabia and other nations by the US
I’m going to against the grain of popular theory here and
come up with my own and say the evolution of fossil fuels
did not bode well for the Soviet Union, so bad luck really.
You see, your system can be much better than the other,
but if don’t have the resources and by resources I mean energy resources,
because they provide production and transport, if you don’t have those,
you’re out of luck.
if you look at when the GDP in the Soviet Union started to stall,
it’s around 1975, five years after the 1970 US oil peak,
causing the US economy to crash and spiral out of control,
while the Soviet Union and the Middle East was thriving.
The USSR had an enormous amount of oil like the US did before,
but the problem with oil is that it competes with coal and oil is more
easy to transport, so it’s more likely for oil to flow to
the country producing the most coal than the other way around.
Prior to the 1970s, the US was the largest oil producer in the world by
far and was thus exporting oil to the rest of the world.
Since they were also producing the most coal in the world,
oil was not a curse to them as electricity provides
the basis for working factories and thus industrialization.
Saudi Arabia, a nation with almost no resources whatsoever and zero coal,
had a very long way to develop itself.
The US then used Israel to start the Yom Kippur war, which it won.
And the US then sent a diplomat to Saudi Arabia and told them that
if they don’t want more trouble, they would do exactly as the US tells
them what to do which was:
This is the petrodollar scheme and it worked.
And it didn’t just work for Saudi Arabia,
but other middle eastern countries.
On top of that SWIFT was introduced around the same time.
This allowed the US to go into massive debt,
receiving enormous amounts of money for investment,
while the Soviet Union, whose growth was dependent on selling oil,
saw it’s currency rate fall.
And we’re seeing the same playbook happening right now again,
with different factors and therefore different effects.
This time China is the target, but it is producing the most coal in the world,
the most solar power in the world, the most wind power in the world,
and the most hydro power in the world.
A low currency rate for a country that mostly sells
manufactured goods instead profoundly different effect
compared to a nation that mostly relied on
the production and export of oil.
And even the situation in Russia and Iran are different from last century
as natural gas has strengthened both nations.