Effects of recent Russian military action against Georgia

The war between Russia and Georgia is very serious. It can have long-term consequences for the security of the United States.

The United States seems unwilling to respond with military force, and so far has responded only with words. We may be over-extended in our military obligations. If Russia succeeds in conquering Georgia (they have the military muscle to do so), this will weaken the United States in its influence with other countries. Georgia is an ally of the United States and has had 2,000 troops on duty with our troops in Iraq. They have been willing to fight on our side in that war, and if we let them be conquered by Russia, that makes us look like an unreliable ally to the rest of the world. Our allies or potential allies will be afraid to help us and our enemies will be less afraid to challenge us.

China will watch what we do, and if we appear weak, they may be emboldened to think they can challenge Taiwan and we will not take risks to defend Taiwan.

This move by Russia also threatens Europe. What Russia is doing to Georgia it can try to do to other neighboring nations such as the Ukraine, Lithuania, etc. This may be the beginning of an attempt to build a new Russian empire.

This can have an effect on the value of the Euro vs. the dollar.

When nations and businesses choose a reserve currency, they look for more than appreciation in value. They look for stability and security. They want a currency backed by a nation with a strong government not threatened by internal revolution or external military conquest. The United States has a two century old constitutional government that has never been overthrown, and it is the strongest nation on earth. That makes the dollar secure. As Russia becomes more aggressive and starts to rebuild an empire, perhaps with plans to build a greater empire than the Soviet Union ever was, this makes Europe look less secure. What Russia is doing with Georgia they can do with the Ukraine and other former members of the Soviet Union. This is a direct challenge to Europe, which would like to incorporate some of these nations into the European Community someday.

Although the Euro has appreciated in value, it is not as secure as the dollar. It is risky. It is a recent invention, and actually an experiment. The European government that backs it is not strong, not stable, not old. Moreover, the European military, apart from the United States, is not particularly strong, especially compared to Russia.

Russia's aggressiveness puts the Euro's weakness in the spotlight. The European Union may appear to some to be at risk, and this makes the Euro seem less secure as a reserve currency long-term, and this can slow or reverse the increase in value of the Euro compared to the dollar.

It also brings to the attention of European leaders and citizens the need for a strong military. Diplomacy and trade can only go so far. Europe will begin to see that if they want to be a strong and influential power, they need to develop a strong military. They have always had the ability to do it, but not the will. Now they may develop the will.