Between the end of World Wat II and the breakup of the Soviet Union in 1991, the United States and the Soviet Union were clearly the world’s only superpowers. What about today?
Q4 2021 hedge fund letters, conferences and more
And what entitles a nation to be considered a superpower? Three things: An extremely powerful military, a very large and efficient economy, and a very large and productive population.
Clearly, the U.S. and China meet those criteria. Both have nuclear weapons and the means to aim them anywhere on the globe. So does Russia, India, Pakistan, the United Kingdom, France, North Korea, and Israel. Are these seven nations superpowers?
India certainly has a very large population, but its economy is just a fraction the size of those of China and the U.S. So too are the economies of Pakistan, the United Kingdom, France, North Korea and Israel.
Russia's Superpower Status
What about Russia? Since the dismemberment of the Soviet Union, Russia’s population shrunk to less than half that of the United States. But even more telling, it’s GDP in 2021 was just $1.7 trillion, in comparison to China’s GDP of $15.6 trillion and $23.2 trillion for the U.S. While the United States and China are by far, the manufacturing leaders of the world, more than one third of Russia’s total GDP is oil and natural gas.
Still, Russia does have a strong military, albeit not nearly as strong as those of the U.S. and China. Furthermore, in its bellicose moves against Ukraine, Russia must deal not just with that country and the U.S., but with the other NATO powers as well.
About 100,000 Russian troops are massed on Ukraine’s border. Unless negotiations with the U.S. and its NATO allies can defuse the situation, it is highly probable that these troops will move into Ukraine.
The only question is how far they will try to go. In 2013 Russian soldiers occupied the Crimean Peninsula, and since then they and their Ukrainian allies have carved out a few thousand square miles of Eastern Ukraine, which they continue to control. The best guess is that Russian President Vladimir Putin will choose to grab another slice of Ukrainian territory rather than attempt to swallow the rest of the country. That would have risked getting drawn into an endless war such as we did in Vietnam, and the Soviet Union did a decade later in Afghanistan – a war which led to the dissolution of their nation.
Putin’s long-term strategic goal is to reassemble the old Soviet Empire, which might once again enable his nation to reclaim its superpower status. Ukraine would be its most important acquisition. So, I’ll bet that he will invade Ukraine. The only question is whether he will go for broke, or be content to just carve out another piece.
Updated on
