Better hurry before China makes a margin call

At Counterpunch, Vladimir Frolov imagines a hypothetical e-mail from Russian President Medvedev to U.S. President Obama:

We pulled our SIGINT station from Cuba and the naval base from Vietnam. And we did not get even a “thank you” note from Bush. Instead, we got missile defense bases in Poland and the Czech Republic. We were stunned to hear your Secretary of State, that charming lady from Stanford, make the only Russia policy speech in eight years, and talk about containment. Tell her she is no Churchill and we do not need a new Fulton.

Barack, your country is in a huge mess. You have lost some venerable financial institutions, and companies like General Motors and Ford are on the verge of bankruptcy. As Putin, my prime minister, says “You and your Wall Street will never get the same respect.” You need a lot of nation-building in the United States and a lot of repair work in your economy. When you take office, you will need all the help you can get.

We in Russia can offer you just that -- help. We sit on a pile of cash and can come to the rescue of your financial institutions in exchange for equity and control. We can run your finances much better than you do, and can issue better mortgages than Fanny and Freddie. Seriously.

You can let our companies like Severstal, Evraz, Metalloinvest or Norilsk Nickel purchase your entire steel industry. And we can have Russian Technologies save General Motors from an inevitable demise in exchange for shifting production from Michigan to Kaluga (they do not have such stratospheric healthcare costs in Kaluga).

This is a good deal for America, and you better hurry before China, which holds over a trillion dollars worth of Treasuries, makes a margin call on the entire U.S. economy.

I know what I am talking about, because we have just bailed out Iceland, a NATO member, by lending it €4.5 billion in emergency loans. Tell me, what is NATO for when it cannot even save its fellow member from going under? They are still building defenses against Russian tanks, but they cannot defend against Russian loans. When Poland goes bankrupt, we will take this missile defense base of yours as collateral.

Barack, the financial crisis has destroyed American leadership. When you become president next January, you will be surprised to learn that when you say something, few countries will listen. Of course, with a smart guy like you in the White House, America will be a more attractive country than under Bush. But your power will never be the same. You have lost your unipolar moment, and are now facing a “polarless” world.

In this world America has a lot of enemies, but Russia is not one of them. Make no mistake about it - we do not want to see your country go under. We want to purchase or lease it lock, stock and barrel, while it is still cheap.

Barack, in this new post-crisis world, we will need an entirely different global financial and security architecture to deal with the new challenges.