(this post, in a very slightly different form, was published on LinkedIn on June 12, 2018).

When I was a child in the Soviet Union, it was a generally accepted fact that the satellite state (Warsaw Pact countries) had a higher standard of living than their imperial overlords (by the way, the Russians certainly did not think of themselves that way), and that the Soviet government was supplying them with direct and indirect aid to keep it that way and to keep them in the fold (they also enjoyed greater personal freedoms, for the same reason).

Now, what is peculiar is that the USSR was not the only superpower to practice that form of bribery: the US (starting with the Marshall Plan) was doing exactly the same thing, except that, due to the strength of the US economy, the US still enjoyed a higher standard of living than its vassal states. The US aid was somewhat indirect: the US has been willing to tolerate protectionist policies of its European and Asian vassals and has been bearing the lion’s share (very close to 100%) of the defense expenditures. Instead of enjoying greater personal freedoms, the Europeans chose to use their aid to subsidize Socialist policies, and to steep their youth in anti-American sentiment (to their credit, the Japanese and South Koreans have been far more honorable).

After the end of the Cold War (over 25 years ago now), inertia kept the status quo (it was not just inertia – the American Left believed that EuroSocialism was a superior social order, and so chose to keep subsidizing it), but finally, the chickens have been brought home to roost by President Trump, who has realized that the subsidies are counterproductive – they feed our enemies, and they do too much damage to the US economy – this point (usually applied to the defense budget strictu sensu) has been realized by much of the US defense establishment (including the current Secretary of Defense) for decades (see David Stockman’s The Great Deformation), and something is now being done. This is an example of Trump keeping (yet again) his campaign promises and has no downside. Indeed, to the extent that it might lead to the collapse of the EUSSR (the European Union) it is a win on all sides.

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