My Review of Batya Ungar-Sargon's "The Jews and the Left"

 Jews and Democrats: Time for a Divorce?

Last November I wrote that Jews were between a rock and a hard place in that both Democrats and Republicans have become more hostile to Jews. (See: https://shulmaven.blogspot.com/2025/11/american-jews-between-rock-and-hard.html ) Here polemicist Batya Ungar-Sargon argues that it is time for the Jews to divorce from the Democratic Party. Simply put the Left in America has become increasingly hostile to Jews; witness the Michigan senate primary win of Abdul El-Sayed, the near gubernatorial primary win of Francesca Hong in Wisconsin, and Peggy Flanagan’s win the Minnesota Senate primary. However, Ungar-Sargon does not suggest that Jews marry the Republican Party, but rather to vote strategically. As my late father of blessed memory constantly reminded me the criterion for a vote is whether or not a candidate would be good for the Jews.

 

Ungar-Sargon presents a brief history of the relationship of Jews and politics in America starting in colonial times. She notes that with George Washington’s letter to the Jewish congregation in Newport, Rhode Island in 1790 that Jews in America would be free to practice their religion. Aside from Grant’s Civil War order which was cancelled by President Lincoln there hasn’t been official discrimination against the Jews. Thus, in her mind Jews should not consider themselves a persecuted minority. This is especially true because Jews as a group have achieved huge success in “The Golden Land.”

 

A problem with the book is that she ignores the entire 19^th Century history and the whole history of private discrimination against Jews (restictions on club membership and property covenants) that existed from the beginning. She also ignores the rabid antisemitism of the Klan in the 1920’s and Father Coughlin in the 1930’s. She also ignores that in Europe and especially in Russia it was the Left that led the charge against the antisemitism of the Right.

 

To her the source of the bond between the Jews and the Democratic Party is a result of the labor movement in the early 20^th Century where Jewish immigrants were in the vanguard of the growing movement, especially after the Triangle Fire in 1911. (See: https://shulmaven.blogspot.com/2020/01/my-amazon-review-of-terry-golways-frank.html )  The deal was closed with the very pro-Labor Roosevelt Administration and Roosevelt’s opposition to Hitler.

 

It was an easy step from labor activism to civil rights activism in the 1950’s and 1960’s. Here Jews were in lockstep with the northern Democratic Party. However, once the civil rights movement moved away from equal opportunity to equal results and later to the DEI mentality of oppressor versus the oppressed Jews began to have second thoughts about the Democrats. This is especially because DEI treats Jews as oppressors, not the persecuted minority of old. In a nutshell, the Democratic Party abandoned the working class in favor of identity politics.

 

All of this has come to a boil with the virulent anti-Zionism of the Left after October 7^th. Here the Left is calling for the destruction of Israel as a Jewish state and thus condemning half the Jews in the world who happen to live in Israel to death. That is exactly what “from the river to the sea” means.

 

Although I have outlined several issues with Ungar-Sargon’s book, she makes a convincing case that the Democratic Party as it exists today is far from the best political home for Jews today. That said, Trump and the Republican Party do not make for a comfortable home. However, given current trends, in a post-Trump world the Republicans could very well offer a better option than Democrats. In the meantime, a trial separation from the Democrats is in order.

 

The Purim War- Part 8: Trump Capitulates

 As we noted in a prior post, Trump is completely transactional and has no loyalty to his ally Israel. (See: https://shulmaven.blogspot.com/2026/06/the-purim-war-part-7-israel-learns.html ) Little did we realize at the time how craven Trump would be with his capitulation to Iran. Trump has gone from “unconditional surrender” to practically whatever Iran wants. The 14-point Memorandum of Understanding (MOU) leaves open Iran’s nuclear program and enables them to continue their ballistic missile program. Indeed, the MOU calls the termination of the war in Lebanon without mentioning Hezbollah and without Israel being a signatory to the deal. Recall Israel entered the war cheek by jowl with the U.S. in the most coordinated inter-allied cooperation since World War II.

 

Perhaps more troubling is that Iran is now given sanctions relief to sell its oil on the market thereby funding the regime that is now desperate for cash. Although the deal keeps the Strait of Hormuz to be free from tolls for 60 days, it leaves open the very real possibility of tolls going forward. This is in complete contradiction to international law and America’s long held position on freedom of the seas. (See: Shulmaven: The Purim War- Part 5, Deadlock in the Strait of Hormuz* )

 

Put bluntly, in exchange for temporarily opening the Strait of Hormuz, which was wide open prior to the war, Iran has conceded nothing. To be sure, if Iran fails to move forward on eliminating its nuclear capacity, the U.S. reserves the right to resume the war.  Trump has threatened this, but his threat has zero credibility with the midterm elections just around the corner. What we have ended up with is something worse than Sherman-Malley-Obama-Biden deal of 2015.

 

In 1938, just after the Munich summit with Hitler, Winston Churchill called out Neville Chamberlain with the following:

 

   “You were given the choice between war and dishonour. You chose dishonour, and you will have war.”

 

I fear that instead of peace, Trump has set the stage for the next Iran War in the not-too-distant future.

The Purim War- Part 7* - Israel Learns a Lesson about Trump

Israel is learning a lesson about Donald Trump. Put bluntly, Trump has no loyalty and is completely transactional. Thus, it should not come as surprise that Trump pressured Netanyahu to call off his second and massive strike against Iran in retaliation to a missile attack on northern Israel over the weekend. It seems that Trump, contrary to “The Art of the Deal,” wants a deal with Iran more than Iran does.

 

Of course, it goes without saying that the U.S. and Israel have different interests with respect to Iran. To Israel Iran is an existential threat while to the U.S. Iran is more of a problem to be managed, shades of Obama/Biden. Moreover, Hezbollah’s presence in Lebanon represents a direct threat to Israel, while to Trump, Lebanon is a sideshow. Thus, from Israel’s point of view any Iran deal that leaves Hezbollah with a free hand in Lebanon is a bad deal for Israel.

 

As a result of Trump’s actions, Netanyahu is between a rock and a hard place. His room to maneuver is limited and he might be forced to accept a deal not of his liking or face an aid cut-off from the U.S. The alliance that began with high hopes last June has become very fragile and is on the verge of shattering.

*-See: https://shulmaven.blogspot.com/2026/05/the-purim-war-part-6-cracks-in-home.html

The Trump Train Runs into a Wall

I am writing this while the U.S./Iran negotiations are in a state of flux, but make no mistake, the Trump train ran into a wall last week. His $1.8 billion “anti-weaponization” slush fund sparked outrage among Senate Republicans. So much so, that Trump’s all-important immigration funding reconciliation bill had to be pulled from the Senate calendar. Meantime Speaker Mike Johnson recessed the House because he lacked the votes to stop a war powers resolution on the Iran War.

 

Although Trump tactically succeeded in defeating Louisiana Senate incumbent Bill Cassidy, he strategically failed by making an enemy of him for the remainder of his term. He along with North Carolina Senator Tom Tillis will remain thorns in his side for the rest of the year. Those two along with Senators Susan Colllins and Lisa Murkowski means that Trump no longer has a working majority on a host of issues that will soon come before the Senate. Further exacerbating the situation is that Trump connived with his own Treasury Department to cease all tax audits on his and his family’s tax returns. The stench grows by the minute.

 

Adding impetus to the revolt was Trump’s endorsement of the ethically challenged Ken Paxton in the Texas primary over incumbent John Cornyn. Cornyn is one of the most well-liked senators in the Republican caucus. Should Cornyn go down this week, he too will likely join Tillis and Cassidy as a thorn in Trump’s side. Even if Cornyn surprises and wins, Trump will not be able to count on him as a supporter.

 

One last thing should the Iran deal go the way many are now speculating, Trump risks the support of Senators Cruz, Graham, and Wicker, among others. Any deal that looks like what the Obama appeasers Wendy Sherman, Bob Malley and Ben Rhodes would have produced will ignite a firestorm in the Republican caucus. Stay tuned.

 

 

Reality Catches up to the Bond Market

Bond yields soared on Friday with the !0-Year U.S. Treasury yield rising 14 bps to 4.6%. Meantime the yield on the 30-Year Treasury hit 5.12%, its highest since 2007. Globally it was the same story, as Japanese yields are at their highest level since 1997 and government disarray in the U.K. is sending yields soaring there.

What’s going on? Three critical factors are coming together: rising inflation, government deficits, and an AI capital spending boom. Triggered by soaring oil prices caused by the Iran War, the U.S. consumer price index (CPI) is now 3.8% over year ago levels, and the producer price index (PPI) is now 6% over the same period a year ago. To be sure, core inflation at the CPI level is lower at 2.8%, but the core PPI is now running at a high 5.2% rate. More concerning is the likelihood that over the near-term, inflation will move higher, not lower. This clearly is not an environment for rate cuts.

Second, huge fiscal deficits are the order of the day. The U.S. continues to run a $2 trillion deficits around 7% of GDP, and with tariff refunds and higher defense spending it will go higher. Although the rest of the G-7 is doing much better, ex-U.S. the G-7 is running a deficit of 2.4% of GDP.

Last, the AI boom in the U.S. is sucking capital in from all over the world. Witness Alphabet’s recent $60 billion global offering. Here are the AI companies that used to supply capital to the rest of the world; they are now massive users of capital. Hence real rates have to increase and in the short run the massive expansion of data centers will put upward pressure on the price of inputs, ranging from memory chips to electrical equipment and construction labor.

 

This is the environment that incoming Fed Chair Kevin Walsh is facing. It is hardly an environment to cut rates. Indeed, with the two-year note now yielding 4.08%, well above the current midpoint of the Federal Funds rate of 3.63%, the market is now pricing in a rate hike. Those who say that Warsh will follow Trump’s orders to cut rates will soon be disabused of that notion. Kevin Warsh does not want to be remembered as the Fed chairman who looked inflation in the eye and blinked.

 

Finally, it is important to recognize that the recent rise rate is taking place in the context of a structural bond bear market. (See: https://shulmaven.blogspot.com/2025/01/we-are-in-early-stages-of-bond-bear.html ) Bond bear markets, just like bond bull markets last a long time. The last bond bear market lasted 35 years, from 1946 – 1981. We are now only in the sixth year of the bond bear market that began in 2020, when the 10-Year U.S. Treasury Bond bottomed at 0.56% in August of that year. So, buckle up, we are still early in a very long cycle.

The Purim War - Part 6, Cracks in the Home Front*

Although America’s blockade of the Persian Gulf is working causing oil storage problems in Iran, an implosion of its economy and a collapse of its currency, severe cracks in the home front have emerged. The 60-day clock of the War Powers Act has run out, and President Trump’s approval rating, with gas prices up nearly 50%, has declined to 37%, according to the latest poll. Indeed, beyond the wackos on the Right and the Left who are rooting for Iran, it seems that voices of the liberal establishment are implicitly supporting an Iranian victory. Why? Their hatred of Trump overwhelms all considerations of America’s security interests in the middle east region.

 

So, where do we go from here? Trump’s novel interpretation of the War Powers Act arguing that direct fighting between the U.S. and Iran ceased in early April, means that should hostilities resume a new 60-day clock would start. The ball is now in Congress’ court, but I would note Congress did nothing in 2011 when President Obama engaged in hostilities in Libya for six months. Further, every president since Nixon have has stated that the act is unconstitutional; it looks like we will once again be headed to the Supreme Court on the issue of executive power.

 

Meantime, Trump, and Chinese leader Xi are scheduled to meet in less than two weeks. This meeting has been postponed before, and it may yet be postponed again. Nevertheless, my guess is that meeting or no meeting, Trump will execute the new military plan to attack Iran’s infrastructure as a means to coerce Iran to yield on its nuclear program.

 

Beneath the surface the dynamics of the middle east are changing before us. The UAE is leaving OPEC and there seems to be a budding alliance between the UAE and Israel. Israeli troops are on the ground in the UAE to assist in its first ever deployment of its iron dome air defense system outside of the country.  Thus, it would be a foreign policy blunder of the first order for the U.S. to fail to achieve its fundamental war aims.

* See: Shulmaven: The Purim War- Part 5, Deadlock in the Strait of Hormuz*

NATO: R.I.P., b.1949 - d. 2026?

NATO is dead, or in the process of dying. NATO was born when the United States stood alone militarily and economically as the West's  power while Europe was weak. Europe is no longer weak, but it certainly acts that way. If if it had the will, Europe would be capable of defending itself. Hence the founding predicate of NATO no longer holds.

The proximate cause of NATO's demise was President Trump's announcing his willingness to seize Greenland by force from NATO ally Denmark earlier this year, (See:Shulmaven: Donnie Does Davos* and Mayhem in Minneapolis ) his failure to consult on his war plans to attack Iran, and most important the the obstruction of NATO allies Spain, France and Italy to deny their respective airspaces to the U.S. Air Force's efforts to to attack Iran. Indeed they even denied access to the U.S. air bases in those countries. It is one thing for them to be passive, it is far another thing to actually obstruct the U.S. military. 

It is not as if NATO has no skin in the game in the Persian Gulf. Indeed their economies are suffering far more from the rise in the price of oil than the U.S. I don't know what, if anything, President Trump will say tonight on NATO, but the clock is ticking on its demise. Further it will require congressional approval for the United States to withdraw from NATO. Of course, the only winner in this will be Russia's Putin

The Purim War

 About 2,382 years ago Esther and Mordechai ousted the Jew-hater Haman, first minister of Persia; an event that is now celebrated as Purim by Jews all over the world. In an eerie coincidence Purim starts on Monday evening March 2^nd. This time, instead of Haman being killed, the bulk of the Iranian leadership including the Grand Ayatollah Khamenei was killed in precision airstrikes by the Israeli air force. The U.S./Israeli effort’s goal is to topple the Iranian regime that has long threatened the region and was yet again reconstituting its nuclear and missile programs. With Iranian negotiators practicing “rope-a-dope” tactics with U.S. negotiators, President Trump’s patience ran out, and he unleashed an air and naval armada on the Iranian regime.

 

My sense is that Trump’s logic was the Iranian regime was weakened by the mass protests against it in January triggered by its collapsing economy. The regime responded with brute force and killed anywhere between 30,000-50,000 people. As they say in China, the Iranian mullahs “lost their mandate from heaven.” It will now be up to the Iranian people to establish a new course.

 

What happens next depends on the staying power of the remnants of the regime and the willingness of the U.S. and Israel to sustain a long campaign. Meantime, by attacking U.S. bases in Saudi Arabia, Iran lost the neutrality of the Arab gulf further isolating them. The other thing to think about is whether or not Israel will take advantage of the situation to cleanup its unfinished business with Hezbollah and Hamas.

 

Of course, it goes without saying, the Democrats are up in arms against Trump making war without congressional authorization. However, a careful reading of the war powers act means that what Trump did, as commander in chief, was legal so far. However, he does have to report to Congress on the war, and Congress will have a say. My sense is that Iran 2026 is not Iraq of 2003 but then again time will tell. But make no mistake, the middle east will not be what it was as of last Friday.

Kevin Warsh and the Fed

President Trump announced this week that he selected, subject to Senate approval, Kevin Warsh to be the next chairman of the Federal Reserve Board thus ending this season's apprentice competition. Warsh seems to be a chameleon because doves see in him his call for a lower federal funds rates and hawks see his past positions that called for higher interest rates and a smaller Fed balance sheet. It seems the immediate market response was a collapse in gold and silver prices that were buoyed by the debasement trade.

In my view both hawks and doves will be disappointed. In the short run I think he will support lowering the Fed Funds rate by another 50 basis points taking it down to a 3%-3.25% range in the belief that rising productivity will lower the inflation rate to the Fed's long missed 2% target. As stated here previously, I think that is a losing bet.  ( See: https://shulmaven.blogspot.com/2025/12/2026-year-of-turbulence.html )  Further, consistent with recent market behavior I do not think that long rates will move lower thereby steepening the yield curve. Rick Rieder, Blackrock's CIO and former apprentice for the job) articulated a case for a 3-4-5 yield curve with funds at 3%, the 10-Year at 4%, and the 30-year at 5.5%. That looks like where we will end up this year, but with the 10-Year closer to 4.5%.

In the short run a Warsh Fed will let the economy run hot. That will bring with it higher profits, higher inflation, higher long term interest rates, and a volatile stock market with a downward bias. But if we step back a bit, it is becoming clearer by the day that we are in an era of fiscal dominance. The Fed would thus accommodate continual deficits of 6% of GDP that will put upward pressure on inflation. When the rubber hits the road the Fed will either be forced to tighten triggering a recession or adopt yield curve control to manage the long end of the curve. It will be only then that we will find out if Warsh is a hawk or a dove. If the Fed moves toward yield curve control the debasement trade will have legs.

Donnie Does Davos* and Mayhem in Minneapolis

 It was quite a week. We had President Trump on the scene in Davos doing his best to break up NATO with his threats to acquire Greenland by force. (See: Shulmaven: History Rhyming with Trump and Greenland ) His histrionics certainly put the conference back on the map and it made him the focal point of attention. That was his plan all along, because he quickly retreated. The conference ended with Trump's setting up his so-called Board of Peace which by its makeup looks more like a Board of War.

But not before Canadian Prime Minister Mark Carney gave him a scathing rebuke calling out his attempt to "rupture the world order." Indeed, the world might have changed last week. Carney is now the hero of the Davos set but I would your attention to the facts that he threw Israel under the bus by recognizing the Palestinian state and he has done nothing to bring a halt to the surging antisemitism in Canada. Thus he is hardly the paragon of Western virtue.

Meantime Minneapolis has exploded in a wave of mayhem culminating in ICE officers claiming their second (alleged) murder victim. With 3,000 ICE officers confronting 25,000 protestors on a daily basis in frigid temperatures things have and will continue to go south very quickly.  ICE looks like an occupying army out for revenge. Whatever Trump's motivations are, it is not helping his agenda as his polls collapse. Indeed, the entire enforcement operation is taking the focus off the real Medicaid scandal in Minnesota and he is making a hero out of the hapless governor, Tim Walz who is likely up to his eyeballs in corruption.

Finally, as of this writing Trump is a pulling an Obama (remember the Syrian redline of 2013) by failing to live up to his promise to support the Iranian protestors. Mass murder has taken place on his watch, and by encouraging the protestors, Trump set them up to be slaughtered on a mass scale by the Ayatollahs. 

*-With apologies to "Debbie Does Dallas" a 1978 porn classic.

Greenland Compromise: Rent, not Buy

Yesterday I wrote about how Trump is following in the footsteps of Hitler and Stalin over his demand to buy Greenland from Denmark. (See: https://shulmaven.blogspot.com/2026/01/history-rhyming-with-trump-and-greenland.html ) Today Trump said he would not use force to takeover the island, but he certainly did not rule out other forms of coercion. 

My sense is that Trump's art of the deal is aiming for de facto, but not de jure, control of Greenland. Denmark has been very adamant that Greenland is not for sale. Denmark has not commented on whether or not it could be rented. Remember, Trump is a real estate guy. So here goes my idea as one way that Trump could get what he wants.

Instead of purchasing Greenland, the U.S enters into a 99-year lease arrangement with Denmark. The lease terms would give the U.S. full operating control over the island in exchange for an annual lease payment amounting to X- $ billions.  That would more than fund Denmark's current obligations to the 56,000 member Greenland community and then some. Thus Denmark would still retain nominal sovereignty over the Greenland and the island would still fly the Danish flag. 

This result is not pretty, but that is the way negotiations could end up.

History Rhyming with Trump and Greenland

Mark Twain noted that history doesn't necessarily repeat, but it rhymes. This is exactly what is happing with Donald Trump's proposal to seize Greenland. Before Hitler took the Sudetenland in Czechoslovakia in 1938 he threatened to invade. Similarly, Putin made noises about taking Crimea in 2014 before invading that part of Ukraine. It seems that Trump is giving new life to my "Reliving the 1930's series. (See: https://shulmaven.blogspot.com/2023/11/reliving-1930s-part-5.html ) The difference here is that instead of acting like a leader, Trump is acting like a three year-old toddler. He neeeeds Greenland. Unfortunately, his tantrum is breaking up NATO and like the previous episodes I noted, it will make the world a far more dangerous place.

My Review of A. Wess Mitchell's "Great Power Diplomacy"

 The Art of the Deal

 

Diplomat/historian A. Wess Mitchell has offered us a long history of diplomacy starting with Sparta’s conflict with Athens in 400 BCE up to the Nixon/Kissinger opening of China in the 1970’s. Instead of the direct application of force Mitchell views active diplomacy as a way of getting the best out of a weak hand and as a way to strengthen a strong hand in the game of nations.

 

His case studies also include Byzantium’s struggle against the Huns and Persia, Venice making peace with Milan to engage the Ottoman’s, Austria’s many struggles in Central Europe, France’s grand strategy in the 1600’s, Bismarck’s in the 1800’s and Britain’s at the turn of the 20^th Century. Above all to Mitchell, interests triumph over ideology requiring a nation to play the hand with the cards it is dealt.

 

Especially interesting to me was Austria’s Prince Kaunitz, Metternich’s predecessor, using Louis XIV’s mistress Madame Pompadour as a go between to establish an alliance with France against Frederick the Great’s Prussia. A few years later we see Austria, guided by Metternich making an alliance with Prussia to stave off France. Indeed, interests are far more permanent than alliances. Also fascinating are the machinations of France’s Cardinal Richelieu making an alliance with Protestant Sweden against Catholic Austria. Mind you this is against the backdrop of huge religious strife in Europe.

 

Mitchell discusses at length Britain’s realization that by 1900 it was overstretched and had to reduce its global commitments. Mitchell follows Lord Landsdowne as he makes deals with Japan limiting its involvement in the Western Pacific, with Russia in Central Asia and with the Untied States in the America’s. All of this was necessary to gird the nation for the war that would come with Germany. If there is one message in the book is that core interests take precedence over peripheral interests. This blog previously reviewed Kori Schaki’s work on the same topic. (See: Shulmaven: My Amazon Review of Kori Schake's "Safe Passage: The Transition from British to American Hegemony" )

 

Another lesson of the book is the importance of mobilizing effective coalitions and isolating the enemy. The worst thing that can happen is to be isolated against a strong enemy. Opponents have to be constrained and if they can’t be constrained by the threat of force, bribery sometimes works as in the case of Byzantium buying off the Huns. But bribery should not be confused with appeasement of a direct rival. In the case mentioned Persia was the direct rival and the bribes enabled Byzantium to hold its own.

 

In reading Mitchell’s book, one has to shudder just to think about Trump’s foreign policy. Instead of making alliances, he is destroying them and making America more isolated while Russia and China are moving in the fill in the vacuum, not a pleasant sight. ( See: Shulmaven: Some Thoughts on Trump's National Security Strategy ) One would hope that at least a few Trump staffers would sneak away to read this valuable volume on foreign policy.

 

The Democrats Snatch Defeat from the Jaws of Victory

The way I see it the Democrats won the political battle over the government shutdown, but as soon as they attacked the deal they committed an unforced error and gave Trump and the Republicans a victory.  Instead of looking like winners the Democrats became losers. How so? With the shut down the Democrats proved they were no longer comatose and were ready to fight Trump and that stance along with Trump voter buyer's remorse set the stage for huge victories in the off-year election.

On the governing side the Democrats achieved robust funding for the SNAP program, the rehiring of riffed workers during the shutdown and were guaranteed a vote on the Obama Care subsidies in December. The Dems have made short shrift of the pledge for a vote on the subsidies. but here they are wrong. The vote will place the Republicans at the horns of a dilemma. If they do nothing, the Dems will have the perfect issue for the mid-terms and if the Republicans compromise with a lower income limit and a minimum premium the Democrats would have achieved their major goal policy goal for the shutdown. The Dems win either way.

Thus, instead of vilifying the eight Democrats who broke the filibuster, they should in turn, commend them for their political savvy and common sense. Sometimes, in politics, you have to know when to take a win.  

Free at Last: Now the Hard Part Begins

After two long years Hamas has finally freed the last twenty live hostages left in the dungeons of Gaza. With the captives being redeemed and an Israeli-Hamas cease fire in place, there is much to celebrate. Nevertheless, we should not lose sight of the very difficult tasks ahead. (See: https://shulmaven.blogspot.com/2025/10/the-israel-hamas-war-is-peace-at-hand.html )

As I write this Hamas gunmen are slaughtering their local Palestinian opponents. This has to stop and if Gaza is to be rebuilt by the proposed middle eastern consortium, Hamas will have to be disarmed. That will not be easy and what Arab state will allow their soldiers to be killed in a Gaza peace keeping mission?

In order for this to work is for the United States, Egypt, Qatar, and Türkiye have to put constant pressure on both Hamas and Israel to maintain the momentum of today. There are few hopeful signs. It appears that there is a new openness to expanding the Abraham Accords and that Indonesia, the country with the largest Muslim population, is prepared to commit troops. President Trump and his team have created the framework for a new beginning in the middle east; let us hope they will have the patience to follow through in the days to come.

Trump, Putin, and Ukraine: Part 2

Last week we wrote up what we thought was a successful conclusion to the Trump-European-Ukraine meeting in Washington D.C. ( See: https://shulmaven.blogspot.com/2025/08/trump-putin-and-ukraine-now-comes-hard.html ) Unfortunately, little did we realize that Trump and his hapless special ambassador Steve Witkoff, and Secretary of State Marco Rubio, were played for suckers by Putin. Put bluntly, Putin did not agree to security guarantees from the Europeans to be coordinated by the United States. Putin wants all of the Donbass and no European troops in Ukraine.  

So what is to be done now? The U.S. and Europe should step up arms shipments to Ukraine and greenlight Ukrainian attacks deep into Russia. In addition both the U.S. and Europe should sanction Russia to the max. The attacks have already begun with Russia's energy infrastructure now under long range attack. Gas lines are now forming in Russia. In addition, as we have argued in the past, Ukraine should set ablaze the Russian oilfields in Western Siberia. The path to a negotiated settlement requires Russia to feel real pain putting the ball in Trump's court. Hopefully that will happen.   

Trump, Putin, and Ukraine: Now Comes the Hard Part

I have been writing about Ukraine since 2014 (See: https://shulmaven.blogspot.com/2014/03/the-ukraine-what-is-to-be-done.html ) and as recently as last March. (See: https://shulmaven.blogspot.com/2025/03/shame.html ) Yesterday’s White House summit meeting with European leaders and Ukraine President Volodymyr Zelensky reversed the very negative vibes set off by Friday’s Trump-Putin Alaska summit where it was feared that Trump was about to sell out Ukraine. The conversations were both serious and friendly and it seems that there was a real reproachment between Trump and Zelensky.

 

However, the hard part is now ahead of us. It remains to be seen whether or not Putin will actually meet with Zelensky. Today Switzerland offered up its good offices as a meeting site. Should that happen, it would open the way for a trilateral summit with Trump, Putin, and Zelensky.

 

What has to be ironed out is the precise border between Ukraine and the Russian held provinces. That border would have to be defensible, which means that the current Ukrainian position in the Donetsk region would have to be maintained, something that Russia is opposed to. Another question is what the European security guarantee would cover.  For example, would it include troops on ground, air support and rebuilding assistance? Perhaps more important what would be the modalities of the United States’ role as security coordinator. Would it include intelligence sharing, military hardware, and air support? Although Trump has ruled out combat troops, would it allow for support troops involved in training. And don’t forget Putin has a vote in all of this.

 

Nevertheless, for the first time since the war started over three years ago there is a pathway to a settlement. It certainly won’t be perfect because Putin’s aggression would be rewarded, but it will enable Ukraine to be a viable and prosperous state. Remember, diplomacy is the art of the possible.

The Wall Street Journal Follows Shulmaven on Socializing the Economy

 Today's Wall Street Journal brought with it an important article by economics columnist Greg Ip entitled "U.S. Marches Towards State Capitalism...." (See: https://www.wsj.com/economy/the-u-s-marches-toward-state-capitalism-with-american-characteristics-f75cafa8?mod=hp_lead_pos5 , paywall) In the article Ip outlines how the U.S. is moving towards state capitalism with Trump's demands for a share of NVIDIA's chip exports to China, the golden share in the U.S. Steel takeover and Biden's industrial policy. In my words, socialism with American characteristics. 

Aside from the over-night news about chip exports, Shulmaven made the same case on July 27th where we added tariffs and Biden's DEI policies. ( https://shulmaven.blogspot.com/2025/07/on-road-to-serfdom.html )Whether we call it state capitalism, socialism or fascism, the result is the same. We are entering a world of state controlled economic activity which in the words of Hayek will put us on "the road to serfdom."

On the Road to Serfdom*

 Although few people realize it, the Trump/Biden years will be remembered when the United States took a giant step on the road to serfdom by socializing the economy. The Republicans of yore held up the virtues of the free market; under Trump that is no longer the case. For generations the Democrats have never been comfortable with the workings of the market, but they conceded its ability to generate wealth and to create a mass prosperity. However, today there are growing voices in the Democratic Party to socialize much of the economy.

Under Biden the country embarked on an industrial policy whose goals were to penalize the production of fossil fuels and subsidize clean energy (solar and wind), subsidize computer chip making, and further increase the government's involvement in healthcare, just to name a few. Biden also left the initial Trump tariffs in place. You can't look to the Democrats to support free trade. Further, Biden attempted to micromanage the economy by putting DEI into every nook and cranny of employment law.

Compared to Trump's second term, Biden's industrial policies were chump change. Trump is in the process of jacking up tariffs from 3% to close to 20%, extorted $550 billion from Japan to fund a sovereign wealth fund, made an investment in rare earth producer MP Materials (See: https://shulmaven.blogspot.com/2025/07/the-pentagon-makes-play-for-rare-earths.html), and with a "golden share" gave the president control of U.S. Steel. To me the sovereign wealth fund brings up memories of the corrupt Reconstruction Finance Corporation of 1932-1953, a path to corruption if there ever was one. Although American universities are need of significant reform, Trump's attempt to micromanage them goes far beyond what is necessary.

My sense is that under Trump we are on the road to something that will look a lot like Mussolini fascism where the private sector carries out the will of the state. For those comfortable with Trump, I would warn them what goes around comes around. When the Democrats return to power the economy could soon be turned into a 21st century version of British Labor Party socialism of the late 1940's with the added kicker of having DEI on steroids. Either way, it is not a pretty picture. 

*-With apologies to Friedrich von Hayek

Trump Crosses the Rubicon

In 49 BCE Julius Caesar crossed the Rubicon in northern Italy thereby declaring war on the Roman Senate. The phrase has since come to mean “passing the point of no return.” President Trump with his B-2 bomber strike on three Iranian nuclear facilities has gone where no president has gone before, including Bush II, Obama, Trump I, and Biden. As a result of this action the middle east has been irrevocably changed, hopefully for the better.

 

It remains to be seen how successful the bombing mission was and to what degree Iran will retaliate. It will take time to do a bomb damage assessment, but the early indications are that the damage was substantial. The key question will be how hard the underground Fordow site was hit. (See: https://shulmaven.blogspot.com/2025/06/israel-and-iran-fog-of-war.html )

 

The bombing raid was coordinated with Israeli strikes earlier in the week that took out Iranian air defenses in southern Iran. With the Iranian nuclear threat presumably removed, Israel prime minister Netanyahu will now have a freer hand to make peace in Gaza. He now may be strong enough to deal with the hard right members of his cabinet.

 

When Julius Caesar crossed the Rubicon, he reportedly said “the die is cast.”  The dice are now rolling in the middle east which means the middle east will look quite a bit different than the way it looked two days ago.

 

One last point, Wall Street’s “TACO trade” (Trump always chickens out on tariffs”) may no longer be valid.  (See:

https://shulmaven.blogspot.com/2025/06/my-ucla-anderson-forecast-presentation.html )   If anything, Trump proved that he is not a chicken.