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The Economic Collapse of “The Putin System”

Moscow/Washington (13/6 – 29)

We took a holiday from reality. Immanuel Niven, a mathematician and philosopher, has long been scrutinizing Russia’s economic landscape, and his recent assertions suggest a dire forecast. 

He contends that the “Putin system” is on the brink of collapse, a scenario he had mathematically foreseen as early as March. 

Niven points to the pronounced tax hikes announced in Russia, the most substantial in its modern history, as well as Putin’s recent rhetoric urging citizens to work as if they were at the front lines. These developments, Niven argues, are symptomatic of the escalating toxicity within Russia’s war economy, signalling a critical threshold that has been reached. As pundits analyse Russia’s economic trajectory, Niven’s mathematical predictions offer a sobering perspective on the nation’s prospects.

In a recent post on X, Niven elaborated on the concept of “toxicity” within a system. He explained that when the expenses required to replace material losses, while maintaining a balance with the rate of losses, surpass the capacity of the state budget to finance them, the system becomes unsustainable. 

This state of being unfinanceable is what Niven describes as toxic for a system, as it inevitably leads to collapse in the medium term, unless the war is decisively won. This analysis underscores the precarious financial dynamics at play within Russia’s economy, as it grapples with the mounting costs of conflict and reconstruction.

Niven draws parallels between the current economic challenges in Russia and the collapse of the USSR. He highlights how the arms race, particularly spurred by US President Ronald Reagan, eventually rendered the costs unsustainable for the Soviet state budget, precipitating its collapse. This historical precedent underscores the gravity of Russia’s current situation. 

Additionally, Niven points out a similar phenomenon observed in 1991 when the Soviet economy experienced unprecedented growth that perplexed experts. This unexpected growth, while initially promising, may have masked underlying vulnerabilities within the economic structure, foreshadowing the cyclical nature of economic booms and busts.

Thus, it’s imperative for Ukraine to target and dismantle these routes to disrupt enemy operations. Second, wars require a financeable economy to sustain them, which means striking at the heart of Russia’s economic pillars, like its oil and gas industry, is crucial for Ukraine’s defense. Third, history teaches us that appeasing aggressive leader like Putin or Hitler only emboldens their expansionist ambitions. Therefore, true peace can only be achieved through Ukraine’s victory. Lastly, dealing with dictators necessitates strength, as they only respect power, not naivety. These simple principles guide political conclusions and strategies in confronting aggression and pursuing genuine peace.

The analysis of Putin’s actions underscores the necessity for a decisive response. By violating agreements, invading Ukraine, and perpetrating a brutal massacre, Putin has shown that he interprets diplomatic leniency as weakness, an invitation for aggression. The conclusion is clear: naivety towards Putin is not an option. He cannot be appeased or trusted; he must be defeated. 

Putin’s bravado, akin to a poker player bluffing, is exposed when compared to reality. He lacks air superiority over Ukraine, has not demilitarized the nation, nor prevented NATO expansion. His ambitions have not restored Russia’s greatness but made it a junior partner to China. Therefore, only a clear victory for Ukraine can minimize the war’s duration, avert future conflicts on NATO soil, weaken the Russia-China-Iran axis, and pave the way for genuine peace. In the face of complexity, simplicity guides us to the right course: a resounding victory for Ukraine is humanity’s imperative.