The President's Daily Brief - September 6th, 2022. The Attrition War in Ukraine's Impact on Europe.

Episode Date: September 6, 2022

It’s September 6th. You’re listening to the President’s Daily Brief. Your morning intel starts now. ------ Today is a Special Edition of the PDB. All because of a protest in Europe. Last Saturday, about 70,000 people in the Czech Republic gathered to protest the war in Ukraine and their outrage at higher electricity prices stemming from the war.  It is the first time we’ve seen something of this magnitude over the War of Attrition — which of course is the battle between Russia, Ukraine, and the West.  Today we’re going to talk about this first big protest in the Czech Republic, plus another one planned in Germany, and then explore how bad things are really getting inside of Europe. As always, we’ll talk about why this is so important to us — even though it’s thousands of miles away. And of course I’ve also got a response to a listener question before we end the podcast.  ------ 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 September 6th. You're listening to a special edition of the president's Daily Brief. I'm your host and former CIA officer Brian Dean Wright. Your morning intel starts now. Today is a special edition of the PDB, all because of a protest in Europe. Last Saturday, about 70,000 people in the Czech Republic gathered to protest the war in Ukraine and their outrage at higher electricity prices stemming from the war. It is the first time that we have seen something of this magnitude over the war of attrition, which of course is the battle between Russia, Ukraine, and the West. Well, today we are going to talk about this first big protest in the Czech Republic, plus another one planned in Germany,

and then explore how bad things are really getting inside of Europe. As always, we'll talk about why this is so important to us, even though it's thousands of miles away. And, of course, I've got a response to a listener question before we end the podcast. But first, let's get started with today's main brief. Folks, we have a very important brief today, so grab your maps of Europe. On Saturday, an estimated 70,000 people took to the streets in the Czech Republic's capital of Prague. And the protesters were demanding two things of their government. First, do more to control the soaring energy prices, especially the price of electricity.

And second, get out of the war in Ukraine. And if you can't do those two things, the protesters said to officials, then resign. Now, this is a big deal, because it is our first indicator of what I've been briefing you about for months, actually. As Russia squeezes off natural gas supplies to Europe, the average citizen could rise up in pain and protest. But before we dive into the latest, let's remind ourselves of why we care about this war of attrition. First, Europe is one of our most important trade and investment partners. Now, depending on the year, we have more trade with Europe and the United Kingdom than we do with China. So any disruption in the European economy is certain to be felt in the fields and factories here in America.

Second, Joe Biden has already sunk 40 billion of your tax dollars into this war in Ukraine, and he's asking for another 11.7 billion. Now, that is adding to our national debt, which is over 30 trillion and counting. Now, we have to pay all of this back at some point plus interest. So will your children and grandchildren be able to do that? It's an open question. But of more immediate concern and the third reason that we should care about this war of attrition is that we are paying outlandish electricity prices in America too.

It's not just Europe. And that's largely because we are exporting around 8 to 10% of our natural gas to our European friends. And that lack of supply here at home has pushed up our electricity prices, leaving one in six American households unable to pay their utility bill. So folks, those are all very clear reasons why we should care about this war of attrition. And it's why we are going to start with this very important protest in the Czech Republic. We had 70,000 people marching in a European capital last weekend, demanding help and paying down their electricity bills and to end the war in Ukraine.

It was a jarring development for the Czech Republic. government. They responded by actually dismissing these protesters, saying that they were organized by pro-Russian agitators with fake Russian news. But if that's true, that's pretty remarkable. Putin can organize 70,000 marchers in one city in Europe. That's quite remarkable. But more likely than not, this protest is about the average working man and working woman, upset about their quality of life. Consider this. The Czech Republic is nearly 100% dependent. dependent on Russian gas, especially for creating electricity. So prices in this country are some of the highest in Europe, with the average citizen paying

twice what they were compared to last December. And that's more than three times higher than what we pay here in the United States. So no wonder they're angry. You would be too. Now, the Czech government is trying to cushion this energy shock, even as they dismiss the protesters. The government has capped the cost of housing and energy based on one's income. but it's not really clear that this scheme is going to work. So look, all this is bad, of course, and we feel terrible for the Czech people.

But candidly, if these protests were just limited to the Czech Republic, perhaps we would be less concerned. In fact, I might not even be briefing you on this. But the crisis isn't just in the Czech Republic. It's spreading all throughout Europe. And I'll tell you, I don't say this often. It should cause you to sit up straight with alarm. So let me explain why that is by going through a list of all the countries throughout Europe that are in crisis this morning. Let's start with Germany.

According to the New York Times, there is a big protest planned in Germany in the coming days, probably many thousands of people, all of whom are upset about electricity prices and demanding an end to the war in Ukraine. Organizers of this German protest are both liberals and conservatives. It's likely that the German government will dismiss these problems. protesters as Putin apologists, just as the Czech government did. But as ever, there is a more likely culprit. The average August utility bill in Germany jumped by an average of 185% compared with the year earlier. But that's not all. German people have also been told that they could face rolling blackouts this winter unless they conserve energy. That means shorter showers,

lowering the heat in their homes and office buildings, shutting off lunches. lights, including on public landmarks. There's also a ban on heating private swimming pools, and there will be shorter working hours for shops and restaurants. Plus, add this to the list. Germany announced that commuter trains will be bumped off their schedules if there's a train of coal that wants to use the tracks. That's because they need that coal at their electricity plants. And if you've been to Europe, you know that this is a big deal. People use trains like we use cars. So for a commuter train to be bumped for coal and the climate change capital of the world, well, that tells you how bad things are getting.

And German leaders know it. Just like in the Czech Republic, the German government is offering a massive relief bill to consumers, around $100 billion. But much like the Czech Republic, there is skepticism from analysts that this will actually help the people and the economy. More on that in a second. But meanwhile, let's move on from Germany and the Czech Republic. to other countries in Europe that are facing crisis. Let's start with France.

Just yesterday, French President Emmanuel Macron pleaded with his fellow countrymen to sharply reduce their energy usage over the next number of weeks. Otherwise, he said, there will be electricity rationing. So he asked for a 10% reduction, and he focused people's attention

on reducing their heat and air conditioner use. But if those efforts aren't sufficient, he said, there would be, quote, forced energy savings, end quote. We're hearing the same level of alarm in the United Kingdom as well. That's because energy regulators there are saying that prices will be up 148%. Some analysts are saying it's probably closer to 178%. Meanwhile, in Italy, energy authorities are predicting consumers will pay 91% more for power and 71% more for natural gas this month.

The same is true with Denmark. Government authorities have said electricity prices are up 70% as compared to last year. So bottom line, all of the lights are flashing red for the citizens of Europe and their electricity bills. And leaders in Europe are very aware of this. In fact, they're set to gather on September 9th for an emergency meeting to discuss what to do. They're looking at a plan out of Spain and Portugal that would cap energy prices. But even if they are able to come up with something, whether it's capping electricity prices or just giving consumers cash, begging people to conserve, well, it's frankly a band-aid that probably won't work. And this is why. In my previous briefs to you, I've talked about the importance of Europe filling up its natural gas tanks before winter arrives. They need those tanks to be about 95% full by November 1st, and that's absolutely important. But even if they fill up those gas tanks before the winter, and they probably will,

the gas will only last them about two to three months, and if the winter is harsh, even less. But let's say that they manage to squeak by and they make it into the spring. Well, we still have a problem. Those natural gas tanks have to get refilled again for next summer's cooling demands and then next winter's heating requirements. Plus, all the natural gas for fertilizer and heavy industry and so forth, That all requires lots more natural gas and the energy that it creates. But as of today, that's not going to happen, at least not from Russia.

Moscow has completely shut off their main natural gas pipeline to Europe. It's called Nord Stream 1. It was at 20% capacity, but now it's zero. It's true that there are two other smaller pipelines running through Ukraine, of all places, and the Black Sea. But Russia's turning those off too. just slowly. Europe is trying to find new suppliers from us here in America and from countries like Algeria and Australia. But again, it's almost certainly not enough to fill the gap left by Russia. So that explains why this scramble from Europe is really just a band-aid that probably won't work.

Europe fundamentally just doesn't have enough natural gas and won't for a very, very long time. Now, all of that is bad. People struggling to pay electricity bills, not enough natural gas for the future, but we've got one final bit of, well, alarming news. And this one really affects you. European countries are entering into recessions, driven in part by these high energy prices. Chief economists at Commerce Bank and ING are echoing what other economists here in America are saying. Germany and its economy, the largest in Europe, is or will be in a recession, even with the government's plan to spend 65 billion plus on helping people and businesses from these soaring energy costs. We're seeing the same predictions of recession in France, too, which is another critical economy in Europe and as a trade partner of ours for companies here in the United States.

So let me give you a sense of why this is happening. Consider glassmaking. Now, it requires a lot of natural gas to manufacture it, but glass supplies are falling because companies can't afford to make it. And that's left companies like Heineken, the beer giant, to say, well, it's struggling to maintain sufficient stocks of their bottles. We can also look at steel manufacturing. Our seller, Mittal, which is one of the world's largest steel makers, said that it plans to

close two of its plants in Germany amid these soaring electricity costs. Now, what's interesting is that the CEO said, look, we have already reduced our gas consumption, but it's just not enough. All right, let's move on to the next industry, aluminum. A smelter in Slovakia is shutting down as well because prices for natural gas are also very high in that country as well. On and on these stories go. There's a fertilizer giant, BASF in Germany. They're cutting back or shutting down altogether. The same is true in the UK for fertilizer company CF industry. industries shutting down. In short, my friends, we have got a real mess on our hands. We've got consumers in crisis, industries in crisis, and governments in crisis. And my goodness, that is a whole lot of news for us to consider this morning. So let's take a quick breather and come back

after a short break. And then we'll get into what I think of, well, this big old mess. We'll be right back. Own it all. Pay off your home. Travel for life. Drive a Ferrari. In celebration of the world premiere of the Monopoly Big Board Buckslot machine by Aristocrat Gaming, Yamava Resort and Casino at San Manuel is giving one person a $1.6 million dream package. The biggest prize in Yamaba's history. Club Serrano members can earn daily instant prizes

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Welcome back to the PDB. We've got a special brief to date about the war of attrition focused this morning on the growing costs of the war in Ukraine. Now, our conversation started with a protest, 70,000 people in the Czech Republic, and then we moved our way through lots of other countries in crisis. And that's because Europe is running short of natural gas to fuel its factories and heat its homes. And that gas used to be supplied by Russia, but as of last Friday, we now know that the Russian spigot will never be turned back on until the war is over.

So if I were briefing you in the White House this morning, here is the council that I would offer. And actually, it's a question that encourages us to step back for a moment and think big picture. So here are the questions. Why are we involved in Ukraine? Said differently, why have we committed over $50 billion to this war of attrition? Now, before you answer those questions, I want to remind you of how Joe Biden and his secretary of defense answer. these questions. On March 26th, Joe Biden delivered a speech in Poland, where he said that, quote, for God's sake, this man Vladimir Putin, cannot remain in power, end quote.

A month later, on April 25th, Joe Biden's Secretary of Defense, Lloyd Austin said, quote, we want to see Russia weakened to the degree that it can't do the kinds of things that it has done in invading Ukraine. So folks, we are in Ukraine committing over 50 billion of your taxpayer dollars for regime change, and we are at war. So was everybody aware of that? Have we properly debated it, and have we thought through the consequences? But let's be clear about something. We didn't have to choose regime change in Moscow.

And we know that because when the war started, Joe Biden offered Ukraine's President Volodomir Zelensky a chance to flee his country. Biden wanted to start exploring diplomatic solutions. And as many of us recall, Zelensky responded with, I need ammunition, not a ride. Well, Joe Biden and Lloyd Austin clearly thought it over, and they made a decision. War with Russia, it is.

It's time for regime change in Moscow. And when you think of it like that, then you can really see how today's brief fits into the big picture. We are trying to destroy Russia and engage in regime change because of their aggression in Ukraine. and Putin knows that, so he will fight with everything he has, and that includes using natural gas as a weapon. And like in all wars, innocent people get hurt, people like the average citizen in Europe or America who can't afford their electricity bill. And economies get hurt too,

in this case, the entirety of Europe. You know, it's a real shame that we didn't think about this before we got involved. You know, we should have thought about that we were hitching America's war wagon to a very weak European partner with no energy independence and virtually no military capacity of any consequence. It reminds me of President George Washington's farewell address in 1796. He warned us specifically against getting involved in European wars and that the U.S. should keep its distance from European affairs. Steer clear, he said, of permanent alliances with any portion of the foreign world. Instead, embrace neutrality and good commercial relationships.

But here we are. 50 billion dollars spent or committed, billions more to go, and one in six American households unable to pay their utility bills, all because we want regime change in Moscow based on a European fight. Folks, I will keep you posted on what comes next. The protests, the blackouts, the commuter trains in Germany parked

so that trains of coal can rush to the power plants. And I'll tell you about the World War II like conservation efforts, like shutting off heat in houses, closing down factories, turning off the lights on, say, the Eiffel Tower, or any other number of European landmarks. And I will also remind you about the price that you are paying, that we are all paying.

Higher electricity bills for our citizens. Higher fertilizer bills for our farmers. And our aluminum and steel, plants shutting down because they can't afford to keep operating either, just like their European colleagues. It's already happened, in fact, in Hawesville, Kentucky at the Century Aluminum Plant. 600 workers laid off because they couldn't afford the electricity anymore. But as I tell you all of these updates, mostly bad but sometimes good, I will remind you of the following quote. And it's how I will end the brief this morning. On May 21st, Ukraine's president.

President Zelensky was asked how the war will end. Was it through utter defeat and regime change in Moscow, like Joe Biden and Lloyd Austin want? Or was it something short of that through tough and difficult diplomacy? Well, here was his response. Quote, victory will be very difficult. It will be bloody. It will definitely be a battle. But the ending will definitely be achieved through diplomacy.

I am sure of it. And with that, one more thing before I let you go. We'll be right back. Welcome back, ladies and gentlemen. One more thing this morning before I let you go. Lewis in Hayward, California wrote in asking about COVID boosters. So here's his question. Now that the next booster is about to be released,

I am, of course, thinking about whether or not to take it. Seems like this one has really only been vetted for efficacy in mice. I'm curious as to whether you took the prior vaccines and what your thoughts might be on taking this one. Lewis, great question. So, three days ago, CDC director Rochelle Wollenski was asked this question to boost or not to boost. And she said, quote, there is no bad time to go out and get a booster, end quote. But here's the thing. She's completely wrong.

Consider this. Director Wollinsky gave that response to a question. question from National Public Radio or NPR. Three days after this interview, NPR ran an entire essay with doctors saying, well, there actually are bad times to get the booster. For instance, have you ever been infected? And when was that? Are you a young person or are you elderly? And how many times should you get boosted and based on what science? I want to highlight one doctor in that NPR essay. His name is Paul Offutt, the director of the Vaccine Education Center at the Children's Hospital in Philadelphia. So he said, quote, the new boosters offer a few months of protection,

but there's no clear evidence of benefit beyond that. Well, there you have it, Lewis. So look, as public health officials argue about this, let me offer three things that science and data tell us we should remember when we make these decisions about boosters. First, the risk of hospitalization from COVID is low. About 1 to 5% of people who are infected. The fatality risk equally low. Now, it's not zero. It's a serious disease, but look, it's not 30 to 50% fatality rates like smallpox or Ebola. Second, we have a very clear risk profile of those hospitalized or those who die from COVID. That includes first those who are obese. Second, those who are age 65 plus. and third, those with compromised immune systems.

Now, that first one you can change. It's hard to lose weight, but it is absolutely within your power to do so. Now, as for that second group, being over the age of 65, well, that one we cannot change. But science says that we can boost our aging immune systems, doing things like daily exercise, especially with weights, getting good sleep, a healthy diet. plus vitamin D supplements if your levels are low. Third and finally, be very careful about the number of times that you get boosted with a COVID vaccine. And that's because we don't have a really good or data-driven sense of how often you should get boosted.

And that's very bad because if it's too frequent, you can actually damage your immune system's ability to fight off disease. Ask your doctor about that. It is a well-established concern for all sorts of. vaccines. So there you have at Lewis, three principles to consider around boosting. Now, you asked about my vaccine choice. Well, let's remember the mantra that I have long encouraged on this podcast, my body, my risk, my choice. So for me, I have a blood clotting disorder. And these vaccines come with some pretty serious warnings, which left my doctor and I with some pretty serious concerns. So I didn't get the shots, and I won't. Plus, I got COVID,

before the vaccines came out. And what the data show is that I now have a degree of protection from severe future infection. In other words, natural immunity. And that protection appears to last longer than vaccine-induced immunity. So, Lewis, I hope that this was all helpful for you as you decide what to do. And as always, talk to your doctor. And as you do, remember this.

Your body, your risk, your choice. Never let the government tell you otherwise. And that, ladies and gentlemen, and 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.