Economic data vs Trump-Russia collusion hysteria

On Tuesday, the US government imposed sanctions on Russian individuals accused of exporting oil to North Korea. The same day, the US State Department blamed Russia for supporting the Taliban in Afghanistan. These sanctions are simply the latest example of the escalating tensions between Russia and the United States, which have severely undermined the theory that Donald Trump is acting in Vladimir Putin’s interests.

If President Trump is a stooge of President Putin and the Russian oligarchy, why is it that Russia’s economy has tanked in the past six months? And why is it that the most anti-Russian country in Europe, Poland, has been one of the best performers in Europe over the same period?

Over the past six months, the Moscow Exchange, Russia’s largest stock market, has fallen 11%. Over the same period, the Warsaw Stock Exchange has gone up 6%. Earlier this year, in February, Russia’s was the worst-performing stock market in the world and Poland’s was the second best.

Many on the left have alleged that Trump is actively working to further Russian interests through US foreign policy. One would inevitably counter with the example of the US missile strike on Syria in April, a direct attack on an ally of the Russian government. And, let’s not forget, the strike was one that went against Trump’s non-interventionist foreign policy; it’s not only that Trump ordered military action against a Russian ally, but he did it for the sake of humanitarianism, not national interest, which goes against the fundamental foreign-policy ideology Trump ran on.

To some, this was simply another example of the much-alleged (but little-verified) Unholy Alliance between Trump and Putin. MSNBC host Lawrence O’Donnell alleged at the time of the strike that the chemical-weapons attack was orchestrated by Putin so that Trump could have a foreign-policy victory. Examples of Trump and Putin working against each other’s interests, are, apparently, further evidence of their conspiracy.

If Trump were trying to help the Russian government, would the US have taken part in massive war games in Eastern Europe last month? Or re-deployed nearly 5,000 American soldiers to the Baltic states? In response, Russia moved significant numbers of troops to its western borders. “These tensions are part of an expanding rivalry and military buildup, with echoes of the Cold War, between Washington and Moscow,” according to The New York Times.

Were he and Putin cohorts, Trump wouldn’t have signed the Senate sanctions bill; while he did so reluctantly, he still signed it, and his stated objection to the bill was that it encroached on executive power, not that it punished Russia.

After it was signed, Russian Prime Minister Dmitry Medvedev called it a “declaration of economic war”. According to Medvedev, the bill “ended hopes for improving our relations with the new administration”, and the US establishment had “outwitted” Trump. This is not exactly the rhetoric one would expect from the Russian government if one bought into the left-wing narrative on Trump-Russia.

Trump is also directly undermining Russian economic interests by liberalizing the US energy sector; oil prices have declined by 11% over the past six months.

Were Trump determined to put Russian interests first, his administration would be functioning very differently. There would be no visit to Russia-foe Poland. There would be no affirmation of the North Atlantic Treaty Organization, an explicitly anti-Russian military alliance. There would be no call to defend “Western civilization”, a sociopolitical concept that excludes Russia.

There would be no targeting of President Bashar al-Assad in Syria, nor tightening of relations with the Sunni Arab world. And there certainly would not be an American military buildup on Russia’s borders.

Jerry Bowyer is president of, and Charles Bowyer is political risk analyst of, Bowyer Research. The firm consults on portfolios that hold positions in both Russian and Polish equity indices. For more information on indices click here.