The President's Daily Brief - October 6th, 2022. Russia Continues to Lose Bodies and Battles. Will This Force a Nuclear Escalation?

Episode Date: October 6, 2022

It’s October 6th. You’re listening to the President’s Daily Brief. Your morning intel starts now. ------ I’ve got a big update on our War of Attrition — the Battle between Russia, Ukraine, and the West — most especially the United States. We’ve had a full week of developments, and I’m going to cover them — plus, what it all means. As always, I’m keeping an eye out for developing stories. Put these two on your radar. First, we’re about a month away from the mid-term elections here in America. We got a fresh poll out showing what you care about — and which party is best positioned to solve those problems. Second, America’s national debt just hit $31T dollars. That’s really bad. I’ll explain why. Plus, we’ve got three listener questions, all about the Dirty Green vehicles we talked about yesterday. ------ Please remember to subscribe if you enjoyed this episode of the President's Daily Brief. Email: [e-mail] Learn more about your ad choices. Visit megaphone.fm/adchoices

It's October 6th. You're listening to the President's Daily Brief. I'm your host and former CIA Officer Brian Dean Wright. Your morning intel starts now. First up, I've got a big update on our War of Attrition, the Battle of course between Russia, Ukraine, and the West, most especially the United States. We have had a full week of developments and I'm going to cover all of them, plus what it means. As always, I'm keeping an eye out for developing stories. Put these two on your radar. First, we're about a month away from the midterm elections here in America. We got a fresh poll out showing what you care about and which party is best positioned to solve those problems. Second, America's national debt just hit $31 trillion. That's really bad. I'll explain why.

Plus, we've got three listener questions all about the dirty green vehicles that we talked about yesterday. But first, let's get started with today's main brief. There's a lot to cover this morning on our War of Attrition, which is the eight-month battle between Russia, Ukraine, and Western powers, including and most, especially the United States. So we are going to talk about those updates, plus my three key assessments of what it all means. So let's get going. On Monday, Russian President Vladimir Putin signed a decree officially recognizing four areas in Ukraine as Russian territory. Now, since then, Putin has acknowledged that those areas are not, in fact, under his control, nor is he or his government quite sure of what the new boundaries might be.

And that's because in the past two weeks, Ukrainian forces using America's weapons and intelligence have dramatically clawed back a lot of territory that Russia took over the summer. You've probably heard the names of some of those areas, of cities like Kharkiv in the north and Kerson in the south. But the important takeaway is this. Russia does not have the troops or equipment necessary to hold the 600 miles or more of front lines that it has previously taken. Now, the Russians are trying, of course. Several hundred thousand reservists have been called up, and some are being sent, but not enough. And what we're seeing is they are not properly trained even once they get there. And that problem is going to get worse for Moscow. And to refresh our memories

as to why, Russia generally trains its troops at the unit level, meaning they're sending in most of these new soldiers to the units directly in the battlefield. But those units are down 30 to 80% of their normal levels, according to assessments that I medium to high confidence in. And by the way, when I say to 30 to 80% down, I mean 30 to 80% of the Russian trainers are dead. That means these fresh soldiers coming to the front lines will likely be less effective, which will lead to higher levels of casualties and the need for even more troops. But will, we'll run. Russia be able to get that fresh group of people? Well, that's an open question. They certainly have the bodies. Assessments are up to 25 million fighting age men, but some of those folks are fleeing Russia right now out of fear that they will be conscripted.

In fact, we have very good data proving this. The number of one-way flight tickets from Russia abroad increased 27% the week that Putin declared the military mobilization. folks are heading to Kazakhstan, Georgia, Turkey, Israel, and the United Arab Emirates. That's according to flight ticketing data from the Spanish company Forward Keys. So how crippling this loss of manpower becomes for Moscow remains an open question. But what we're seeing is Russia is stepping up its use of drones as a likely stopgap measure. Specifically, they're using drones purchased from the country of Iran brought in about a month ago, and they are striking deep into Ukrainian territory. A couple examples here, a military base just south of the capital Kiev,

which for a long time now has been very far from the fighting. Well, that base was hit by one of these Iranian drones. And about a week ago, the port city of Odessa started getting hit too, and in fact it continues to get hit this week by these Iranian drones. So stepping back for a minute asking ourselves about the odds for peace. folks they are at their lowest point this week and perhaps since the start of the war as a demonstration of that ukraine's president of vladimir zolensky who himself said that this war ends at the negotiating table well he signed a decree on monday saying that he will not negotiate with russia from here on out meanwhile russia's main supporters in

china and india have both stuck with moscow there was a vote at the united nations last friday to condemn Russia for annexing Ukraine's territory. But China and India abstained and the vote failed. Now, that abstention was a sort of diplomatically polite thumbs up for Vladimir Putin. Plus, on Sunday, China warned Europe and the United States that if they allow Ukraine into NATO, which of course is our military alliance amongst Western nations, and Zelensky said he wants to join it, well, if he does or tries to, there will be grave consequences. warned Beijing. So here's the quote,

All European countries will tremble under the shadow of a possible nuclear war should Ukraine join NATO. Beijing went on to say, quote, instead of pursuing resolutions to end this conflict, Washington, D.C. has over and over again displayed that the U.S. is charging towards the other direction, fanning the flames of war. So that gets you caught up over the last week's developments, which means that we need to ask what to make of all of this, and why does it matter to people like you and me here in America? So let me offer you my analysis with three key takeaways. First, the Russian struggles that you are seeing on the front lines, that is a direct reflection of what happens when you have a dictatorship running your country.

And here's what I mean. Vladimir Putin is not just the president of Russia, but rather the supreme ruler effectively. Elections there in that country are a sham. He controls them. And everyone in his country knows that to include those around him in his government. Well, that creates a culture where you don't want to tell the president or the supreme ruler any bad news. Instead, you tell yourself and others and him, of course, that all is well. All is fine. And tell you can't lie anymore. The truth of failure is just too obvious. So in the past, we we have seen this happen, things starting to get to the point of breaking in Moscow around truth. Let me give you a very important example. A Mr. Andrei Gulliov, who is a former deputy commander of Russia's

Southern military district, he was asked on Russian TV why the country was facing so many losses in Ukraine and why the retreat from key areas. So here's what this senior military leader from Russia said. Quote, from a military standpoint, I can't explain it. perhaps this is a landmark milestone, not necessarily in the military sense, but also politically. The problem we have is the constant delivery of good reports, or maybe you can call it constant lying. This system of lying does not go from the bottom to the top, but rather from the top to the bottom. End quote. So once he said that, criticizing Putin and the generals, the TV station cut the feed because of what they said were, quote, technical difficulties, end quote.

Which leads to the second key takeaway this morning. Putin is not a desperate man right now, but as the lies become more obvious, in other words, he faces steeper losses, more embarrassing losses showing how weak his military is, well, he may embrace desperate measures. And yes, I am speaking of tactical nuclear weapons, including using them against civilian targets like apartment buildings and malls and major cities like Kiev and Odessa. And that's because what he knows, in fact, what the world knows, is that this war is not really about Russia fighting the Ukrainians. It's about the United States and some weak partners in Europe trying to forever weaken Russia or kill Vladimir Putin, or maybe even both. Folks, that's regime change. And in fact, Joe Biden and our Secretary of Defense said that

last spring. And that means at some point, Putin may well decide that he has no choice but to escalate to nuclear weapons. Now, how high are those odds? No one knows truly. And that in and of itself is very frightening. And that gets us to our final key takeaway. We have to remember that Putin still has friends. As I've spoken of frequently on the PDB, China and India still support him. They buy his oil, his gas, his coal, and his timber. But it's not just China and India. Yesterday, the oil cartel OPEC Plus voted to cut the supply of oil to the world

in order to boost prices. That is the exact opposite of what Joe Biden asked of these countries just weeks ago. And these countries did it anyway, knowing that it would benefit right. Russia, and them, of course, because higher oil prices means more cash for all of them to include Moscow. And that's not my opinion, by the way. Here's how the White House reacted to this news about OPEC, with these words actually spoken by the spokeswoman Karin Jean-Pierre. Quote, it's clear that OPEC Plus is aligning themselves with Russia based on today's announcement, end quote. You know what, she's right. The 13 nations that make up OPEC plus

including countries like Saudi Arabia, Mexico, Malaysia, Iraq, and the Congo. All of them are aligning with Russia and just don't care what Joe Biden says or what Europe wants. And that means that you, my friends, will pay the price. From your electricity bill to your gas bill and the billions of dollars that you are sending to Ukraine every month, all of it is going to add up. In fact, it already has. but the question is what will the ultimate cost be? Financially, it's hundreds of billions of dollars.

But what's the military cost? Well, for us, we are flirting with World War III, and there's just no way to sugarcoat that. Look, I don't want that kind of outcome, but as of this morning, I'm going to be honest with you. I would not be surprised one bit if that is where this crisis leads. coming up ladies and gentlemen a closer look at what's on my radar two quick race for you one on the midterm

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First, we are about a month away from America's midterm elections, and a fresh poll out this morning makes clear what people like you are worried about. So according to a poll from Reuters Ipsos conducted September 27th to October 3rd, the number one concern of voters in this country is the economy, specifically inflation. 30% put it as their greatest concern, and they want it addressed. When asked which party is best positioned to do so, other polls from NBC News and ABC News show that Americans trust the Republican Party over Democrats on this issue by nearly 20 points. By the way, the other issues of importance found in this Reuters poll include

immigration and crime. And on both, respondents also prefer the Republican Party to Democrats, with 40% for Republicans and about 30% for Democrats. That is roughly in line with polls by NBC and ABC News as well. So I highlight these findings because of how often we speak about these issues, inflation, crime, and immigration on the PDB. But also because these polls are not showing much interest in the national debt. And that is the focus of our second radar story for this morning, because it is a very important issue for reasons you might not be thinking about. The U.S. national debt has passed $31 trillion for the first time in American history. The Treasury Department released those numbers on Tuesday, showing that the national debt total was $31.123 trillion as of Monday.

that number is expected to grow. Policy analysts are saying that $1 trillion per year in new debt is the four for new debt. It's the least that we will do, giving growth in entitlement spending like Social Security and Medicare and Medicaid, plus new spending like the war in Ukraine, plus Joe Biden's climate change bill and Joe Biden's student loan forgiveness plan. So combine this record-setting news about the federal government with this. total household debt for Americans, like your credit card bills, auto loans, and mortgages, well, that amount has risen to a record $16 trillion. That's according to a report from the Federal Reserve Bank of New York about a month ago.

By the way, credit card balances, by the way, went up $46 billion in that note from the Fed, which was one of the largest recorded since 1999. So why do we care about these two pieces of news, federal debt and personal debt? Because, I mean, I suppose to be fair, America has been carrying a lot of debt for a long time. Well, if that's what you're thinking, let me give you something else to ponder. Interest rates are going up by a lot. And that debt held by you and me and Uncle Sam, it is going to be a lot harder to pay for. Imagine you're the government and you've got a credit card with a $31 trillion balance

with a 0% interest, one of those introductory rates. Well, that's manageable so long as you're growing, bringing in income. For the government, that's a growing economy and solid levels of taxes. But what happens when that 0% introductory rate goes to 2% or 5% and then your economy starts to slow. Your tax base shrinks. Well, that mix of problems, we're about to find out what happens next. Because the Federal Reserve is raising interest rates to beat inflation, which means as the federal government constantly refinances, reissues debt, they're no longer paying that zero percent introductory rate, or even 1%, but rather something much, much higher. And then as those rates go up, Well, it's true that inflation may come down. That's good. But the economy gets crushed in the meantime.

And that's bad for us all with or without debt. And let me underline that point. A recent survey of America's CEOs at Fortune 400 companies found that 90% of those leaders believe that a recession is coming or is already here. And half of those CEOs are already planning for layoffs. And that creates a real pickle, doesn't. in other words, the interest payments start going up for you, for me, for Uncle Sam, but our income is going down. We lose our jobs. We start losing our tax base. So these are all the concerns being raised this morning in editorials at the Wall Street Journal, CNBC, and a host of financial and economic observers. So I can't tell you what comes next, but I will tell you this. What all these folks are saying

in these various editorials, is that it is highly possible that our interest expense on this debt will soon surpass Social Security as the largest item in the federal budget. And that folks spells trouble. It's a quiet trouble, isn't it? It seems kind of academic and hard to understand. But there are serious implications. It's a big, big problem. So as you go to the ballot box in November, I encourage you to think about government spending

and debt is a part of your consideration about who to vote for, what financial priorities should govern the nation. Because while I am not a financial expert, I am listening to those who are. And they are almost all universally telling me that all the lights are flashing red on this problem. And folks, I really fear that they are right. And with that, one more thing before I let you go. Some listener questions about the dirty green podcast. yesterday on electric vehicles. We'll be right back. Lowe's has the brand's pros trust to get the job done.

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One more thing before I let you go. I got a lot of great questions from you all about the podcast yesterday, where we covered dirty green electric vehicles. Most emails were really, really great, but a few felt like I missed a couple things, three things in particular. First, I got notes from Kelly B, Jeff Z, and John H in California. All said that we should talk more about the cost of replacing car batteries,

even if a car isn't in an accident. Because their point was that batteries lose their life after a certain number of charges or years, depending on usage and weather. So at some point, every single electric vehicle will need a new replacement battery, and those can run over $20,000. Well, Kelly, Jeff, and John,

you are all quite right, and I will include that in the update for when I run this Dirty Green Series again. Next, I heard from Scott in Heathsville, Virginia, and Ted in Lexington, Kentucky. They said that I forgot to talk about the price of electricity when thinking about fueling up those batteries. Because for those two gentlemen, electricity is more expensive than gas in their hometown. And look, gentlemen, you are quite right, that in some places in America, that is absolutely true. In other places, though, that's not quite as true.

Still, this whole issue of expensive electricity here, cheaper electricity there, that's going to become a very big deal because as we rip out reliable energy and replace it with unreliable solar and wind, you may have both a supply and a cost issue that we can't even fully appreciate right now. Finally, Dennis in Rochester Hills, Michigan, he felt like I should have encouraged listeners to think about what happens during, say, a hurricane or tornado or a forest fire. He asked, will people have enough charge in their cars to flee? Are there fast power stations along the evacuation route? And will you have hours to spend to charge up your car?

Or will the flames and wind get to you first? Well, fair point, Dennis. And now everybody else is thinking about your concern, too. And that, ladies and gentlemen, concludes your morning brief. As always, we close out the show reminding each other of why we are here, talking about our country and our world. It's the creed of every good spy and every smart American. It's from John, chapter 8, verse 32.

And you shall know the truth. And the truth shall make you free. Good day. Some follow the noise. Bloomberg follows the money. Because behind every headline is a bottom line. Whether it's the funds fueling AI or crypto's trillion dollar swings, there's a money side to every story.

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