Readers, please note that this is my opinion alone.
I’m writing this in the midst of a continuously changing environment for the defense of the United States as the Biden regime transitions to the Trump 2.0 administration. Trump’s rhetoric (I hope that’s all it is) about military action in Panama or acquiring Greenland or intensifying tariff wars with our closest trading partners, Canada and Mexico, are happening in a globally diverse and rapidly changing world. Examples: Gaza deal, Cuba sanction category lifting. What happens next is anyone’s guess.
Some bullets follow.
Bullet 1.
The Kremlin reiterated that it is ready to hold talks with US President-elect Donald Trump without any “preconditions” but noted that its negotiating position remains unchanged. Kremlin Spokesperson Dmitry Peskov responded on January 10 to a Trump statement about arranging a meeting with Russian President Vladimir Putin and stated that Putin is open to contact with international leaders and that “no conditions are required for this [contact].” Peskov reiterated, however, that the Kremlin maintains its “repeatedly voiced” position on Ukraine that Putin explicitly defined in June 2024 and repeated in his December 19 Direct Line presentation. Putin demanded in June 2024 that Ukraine replace Ukrainian President Volodymyr Zelensky and his government under the guise of “denazification,” demilitarize, and cede significant swaths of territory in eastern and southern Ukraine to Russia, including areas of Ukraine that Russia does not currently occupy – all effectively amounting to Ukraine’s full capitulation. No negotiations will result in a meaningful or sustainable peace as long as Putin remains committed to these demands – regardless of the Kremlin’s “willingness” to hold talks with Western leaders.
(“Russian Offensive Campaign Assessment, January 10, 2025,” https://understandingwar.org/backgrounder/russian-offensive-campaign-assessment-january-10-2025)
Bullet 2.
In a January 11 post, the American Enterprise institute offered these summary observations:
1. “One of the most important decisions the incoming Trump administration faces is whether to continue providing aid to Ukraine against Russian aggression. In a new AEI report, Critical Threats Project Director Frederick W. Kagan, former Defense Department official Elaine McCusker, and Richard Sims demonstrate that a Russian victory would cost the United States hundreds of billions of dollars more than if the US were to maintain or strengthen current aid to Ukraine.”
2. “The Trump administration inherits a dangerous situation in Ukraine largely because of the Biden administration’s unsuccessful foreign policy. AEI Foreign and Defense Policy Studies Director Kori Schake documents how the Biden administration failed by its own standards in Europe, the Middle East, and Asia.”
We recommend full reading. The citation and link are here: “America’s Interest in a Ukrainian Victory,” https://hello.aei.org/index.php/email/emailWebview?email=NDc1LVBCUS
Bullet 3.
Below is an extract of the breakdown of defense spending in states where the money spent was for weapons to assist Ukraine in defense against the Russian invasion. I have written about Putin and how he is following the Hitlerian history and the Stalinist history of deception, military expansionism, and internal murderously harsh persecution of any dissent. Now the test of America’s resolve will be placed in the hands of the new Trump administration. IMO, no one can predict any outcome.
Here’s a brief from X on the money earmarked for Ukraine that is actually spent within the US defense industrial base: “‘Aid to Ukraine’ is really an investment in American manufacturing (updated),” https://x.com/colbybadhwar/status/1877369745109889415
$57.9 billion has gone into the US defense industrial base to date. That will reach well over $80 billion once all funds are obligated. Top recipient states:
1. Arkansas – $4.7 billion 2. Alabama – $3.8 billion 3. Pennsylvania – $2.99 billion 4. Arizona – $2.79 billion 5. Texas – $2.17 billion 6. California – $2.17 billion 7. West Virginia – $1.98 billion 8. Florida – $1.75 billion 9. Ohio – $1.09 billion 10. Missouri – $969 million
Bullet 4.
It is critical for a nation to be able to finance its defense expenditures. Here’s Torsten Slok with a chart he prepared that compares the US primary deficit (that is the important number, IMO) to that of other countries.
A strong economy usually means higher tax revenues for the government and lower expenditures on unemployment benefits, which in turn means better government finances. Despite the US being in a solid cyclical position, the US budget deficit is the biggest among OECD countries, see chart below. If growth slows and the unemployment rate rises, the US fiscal position will deteriorate even further.
Note: Primary budget deficit = budget deficit excluding interest payments. Source: IMF, Apollo Chief Economist
I repeat my opening observation. Nothing is predictable now. The only thing we know today is that the war in Europe continues and expands. And we now have evidence that Ukraine has captured North Korean soldiers: “Ukraine says it captured 2 North Korean soldiers fighting for Russia,” https://apnews.com/article/russia-ukraine-kursk-north-korea-315686a16f8496b008dde3f061948b2a. Whether there is a prisoner exchange of North Koreans for Ukrainians held by Russia remains to be seen. Such a thought was unpredictable only a few months ago.
Some personal history.
My ancestors include immigrants from what is the Odessa Oblast in present-day Ukraine. They left (fled) in the late 1800s, and those who remained were persecuted by Russian czars. The descendants of those who remained were persecuted by Stalin, who starved Ukrainians, and by Hitler, who murdered them. Any remaining descendants are presently being droned or bombed or shot or otherwise persecuted by Putin and/or are engaged in the defense of Ukraine.
Second personal note. I’m the last in my family to serve in the American military and wear a uniform. US Army, 1966–1969, Captain. The first was a great uncle who rode cavalry under General Pershing. Father in WW2 (US Navy), uncles in WW2 (Army), cousin in Korea (Air Force). Unlike another Wharton graduate who was three years behind me, I didn’t have any deferments to avoid military service. Please note that there is now an entire generation of adults who have never faced any requirement like a military draft. And a second generation is following them. My children and grandchildren are among them.
Final observation. Congress has screwed around with the defense budget for years. They finally just passed the budget for 2025 on Dec 11, 2024. Defense analysts will tell you that it is increasingly difficult and costly to fully staff the armed forces of the United States. The unknown is what the Trump 2.0 experience will do about the national defense capability of the United States. Senate confirmation testimony is a word game. It is the coming actions that will count. Poet George Santayana’s words warn us, “Those who forget their history are condemned to repeat it.” I will add that to forget something one has to first study and learn it or experience it.
My own study of history is fresh in my mind. Our new book, The Fed and the Flu: Parsing Pandemic Economic Shocks (https://www.thefedandtheflu.com), explores how pandemic shocks alone lead to a different set of economic outcomes in the medium term than wars do. Yet pandemics also tend to destabilize the status quo, including governments and geopolitical relationships. Wars may spark pandemics, or conflicts and their origins may be traced in part to a pandemic’s societal and political impacts. My co-authors and I found instance after instance of the interplay between these two “Horsemen of the Apocalypse,” from the world of the ancient Hittites to the Greeks to the 20th century experience with Spanish Flu (1918), Asian Flu (1957) and Covid (2020-20??).
Here’s a reading list.
“Russian Offensive Campaign Assessment, January 11, 2025,” https://understandingwar.org/backgrounder/russian-offensive-campaign-assessment-january-11-2025
“Ahead of Trump’s return to office, Ukraine and Russia battle for Kursk,” https://www.washingtonpost.com/world/2025/01/11/ukraine-russia-kursk-counterattack/
“Diary of a Dead North Korean Soldier Reveals Grisly Battlefield Tactics,” https://www.wsj.com/world/diary-of-a-dead-north-korean-soldier-reveals-grisly-battlefield-tactics-fafbede7?st=dpavnB
“Tougher U.S. sanctions to curb Russian oil supply to China and India,” https://www.reuters.com/markets/commodities/tougher-us-sanctions-curb-russian-oil-supply-china-india-2025-01-12/
“North Korea, Russia, and History,” https://kotokreport.com/north-korea-russia-and-history/
“Putin Expansionism in the New Era of Trump,” https://kotokreport.com/putin-expansionism-in-the-new-era-of-trump/
“Syria,” https://kotokreport.com/syria/
“What Trump’s Draft Deferments Reveal,” https://www.theatlantic.com/ideas/archive/2019/01/trumps-military-draft-deferment-isnt-unusual/579265/
“Trump, Wharton alumnus, distances himself from Penn in third presidential campaign,” https://www.thedp.com/article/2024/10/penn-trump-penn-mentions-distance-wharton-ivy-league-election
