Understanding the Motivation of Putin is the Key to Determining How the West Will Ultimately Respond to the Russian Invasion of Ukraine.

What on earth would Possess Vladimir Putin to risk a global war in order to control Ukraine, an eastern European backwater?”

On September 14th, 1960, the nations of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela agreed to create an organization that could bring some degree of stability to the world oil market. This organization operated under the acronym known as OPEC. Prior to the formation of OPEC, oil was a commodity commanding little value. Funding members were considered by the west to be unimportant backwaters, lacking in economic and political significance.

At the time of its formation, the cartel was supplying roughly 47% of the world’s output and the formative purpose was to establish a floor price for a necessary commodity that routinely sold for roughly the cost of production and sometimes less. By the early 1970s, a largely benign OPEC, then accounting for 56% of global output, decided to act, based upon a falling out with the west over Israel, as a price setter, rather than a price taker. The result was a series of persistent price hikes that resulted in the cost for a barrel of crude oil roughly tripling in a 10 year period.

China currently represents the worlds #1 producer of wheat, producing 135 million metric tonnes in 2021. India represents the world’s #2 producer of wheat, producing 103 million metric tonnes in 2021. Russia is #3, producing 77 million metric tonnes in 2021. However, if one includes wheat production from Belarus and Ukraine, Russia jumps from #3 globally to #2 and gets to within shouting distance to China as the #1 producer. More importantly, were Russia to prove capable of modernizing Ukraine agriculture practice, many agricultural experts feel completely comfortable predicting that Ukraine wheat output could double in very short order. The potential exists for a Russia/Ukraine/Belarus combined overall output to surpass 150 million metric tonnes within just five years. Of that amount, roughly 100 million tonnes would be destined for export, to nations that operate in a food deficit.

Global food security is every bit as important as global energy security but as of today, wheat prices are not yet dictated by a global cartel. That might soon change, if events unfold in favor of Putin.

China and India refuse to condemn Russia for its invasion of Ukraine. The reticence of China to undermine their ally is understandable. A refusal of India to side with the west, at face value, seems a complete mystery to those in Europe and America. But, should the rationale of India be to coordinate wheat prices, on a go-forward basis, siding with Russia would be entirely logical and serve the national interest of the Indian people. Cartels have unique abilities to set tiered prices; domestic prices at artificially low rates, those losses subsidized by high export prices. India and China would gladly participate in a combine for the benefit of their citizens. The top three global wheat producers, with a Ukraine falling firmly under the thumb of Russia, could effectively serve as price setters in the near future, akin to an OPEC style cartel. A formal declaration will not be necessary, dictators and autocrats don’t need to come up with a name such as “SPECTRE” to meet and decide how best to raise wheat prices and beggar the west.



The combined Russia, Ukraine, India and China wheat output today represents the same global market share, percentage wise, as was reported by OPEC at the time that the oil production cartel opted to serve as price-setters and dramatically increase costs to the users. Ukraine is THE key to a successful pricing cartel to be established, whether overtly or covertly. Should Ukraine evade the grasp of Putin and firmly move towards western democratic rule, then wheat output could logically remain in a price-takers market, which would benefit the west and for that matter, any nation that operates with a food deficit.

We may have completely miscalculated the motivation of Putin; a huffy and rambling set of declarations that Russo-Ukraine ties are cultural and ethnic do not make the slightest bit of sense as a provocation for a war.

The intention of Russia to create a global food cartel and the need to tie-up the remaining global swing producer DOES justify the risk of a global war. A price-setting food alliance rebalances the Russian economy; it ceases to be totally oil dependent and provides a new variety of levers to be applied against the west.

If free market policy advocates do not quickly identify the risk of wheat prices tripling in the coming decade, based upon the ability of Russia to withhold deliveries at will, then we will lose the ability to stop a global price setters market. The battle for Ukraine independence is not a fight between western democracy and Russian autocracy; that’s just surface noise, a misdirection. No, the conflict is for the last, the best, the largest remaining piece of under-utilized farmland on the planet. Should the Ukraine fall back under the thumb of Russia, the west will lose the ability to hold the line on food price inflation.

Democratic first world governments need to think of Ukraine, not as a backwater, but rather, an agricultural superpower in its own right.

What Saudi Arabia represents to the oil world, Ukraine is the agricultural world equivalent. Ukraine is a phenom, a savant, a nation blessed with such productive soil that wheat output routinely exceeds most other developed nations, acre per acre, without even breaking a sweat. The country, as a member of a food cartel, would be capable of increasing or decreasing output almost at will to serve the goals of price setters. This makes Ukraine a linchpin, the final piece of a puzzle needed to create an anti-western wheat combine.

Were we to orient our thinking along the lines of what Russia, China, and by default, India, are doing, or not doing; it would be obvious to policy makers what the future holds for energy and food pricing. Russia and China, with the Ukraine, will hold the west hostage with a food cartel, western influence would wane in third world nations that require food handouts. A global reorientation towards Chinese and Russian influence would result.

In economic terms, the Ukrainian invasion represents a flanking maneuver against the west, designed to encircle European and western democracies in an economic killzone of our own creation.

China already controls the bulk of value added manufacturing globally and can cut the west off at will. Should Russia be victorious over the Ukraine and ultimately control the global raw food supply, then western democracies will be completely boxed in, forced to acquiesce to the whims of China and Russia, or else we starve, are simultaneously deprived of furnace parts to heat our homes in the winter, are cut off from fertilizer by Russia and denied tractor parts from China to maintain our own agricultural output. It’s that stark. With the Ukraine in tow, the Axis can initiate a pincer maneuver at will, bankrupt the west, starve us into submission and inflate away any remaining value of western currencies.

Oil was almost valueless, until it wasn’t. Wheat remains one of the least valued foodstuffs on the planet, until it isn’t.

Wheat prices have increased by 50% in the last three months, from $8 per bushel to $12. Today, the cost of durum needed to bake a one pound loaf of bread is still just $.14 US. The recent percentage hike in the cost of a cereal crop seems shocking; that said, wheat remains relatively affordable for a first world western budget. The more immediate pain comes in developing nations presently operating at a food deficit; life or death modeling choices might already be underway.

Putin will want price hikes on the west to hurt and $30 per bushel is that pain threshold. Importantly, at $30 US per bushel of wheat, Russia, with Ukrainian production consolidated, will generate as much money from hard currency wheat exports as they earned from oil sales in 2021.

OPEC nations were unimportant, once, until they coordinated to act as price setters rather than price takers. Now, we shake in our boots whenever OPEC holds back supply and then seek, futilely, to reduce dependence on fossil fuels. As carbon based life forms, how do we substitute away from food? Policy analysts, by scratching their heads over the lack of condemnation by India on the Ukrainian invasion, have clearly failed to connect the dots on the food front. All efforts to control inflation fail when pricing, for the basic necessities of life, are dictated by anti-democratic producers, who can double, or even triple prices overnight, via price fixing and withholding of supply to those nations that do not play along with Russian global ambitions. This war is not about longstanding grievance, it is about money, hard power and soft power influence.

The President of Russia is undeniably a monster, but he is a monster on a mission.

A persistent western narrative regarding Putin is that he is a madman. What if he is not insane, but rather, just a calculating sociopath? What if Putin considers people to be just another input, a widget in the production equation? What if Putin has engaged in a deep-dive cost/benefit analysis and determined that farmland in Ukraine and Russia could be revalued by an incremental $20 trillion US under a cartel pricing arrangement?

Farmland is far more valuable than an oil field over a long period of time, as farmland, provided it is maintained and not rendered useless via chemical or nuclear bombing, will be productive forever. There is no depreciation on land but oil wells do peter out. At an assumed value of $100,000 attached to every Ukrainian, the economic value of the population = $4.4 trillion. At an economic value of $300,000 per person, then the entire population is valued at $13.2 trillion. In fact, an actuarial value of $500,000 per person could be applied and Putin would still, roughly, break even. If Putin exterminates the entire population of Ukraine and then creates an agriculture pricing cartel, he and his cronies may still wind up with a net economic benefit of almost $7 trillion over time. And a full extermination won’t take place, because there is a percentage of the population in Ukraine, maybe 10%-20%-30%, who will be “Vichy” sympathizers, and Putin will spare their lives. The math is terrifying when one prices a human life on an insurance actuarial table.

An aghast media would sputter that one cannot put a price on a single human life, to which Putin would, correctly, respond: “that’s nonsense, your western life insurance firms exist exactly for that purpose, to determine a price on a human life”. And what do we say to that, when he uses our own actuarial tables to undermine our indignation?

Under this premise, that Putin is a sociopathic actuary with a goal to create a food superpower cartel, he will cluster bomb and firebomb every man, woman, child, pet dog, fainting goat and terrified zoo ape in Kiev in order to seize the farmlands of Ukraine and wreak financial havoc on the west. We may not accept it; most of us are still completely in the dark on the rationale, but Ukraine represents the line in the sand. If the global community does not stop Russia from acquiring Ukraine, we may never stop inflation and the world order will swing towards autocrats and away from democracy. Nuclear threats by Putin ring hollow; nobody will purchase radioactive wheat, it could not be given away and workers, even slaves, could not work on nuclear fallout fields in Ukraine. If Putin were to fire nuclear missiles at the west, the wheat market shrinks by the number of persons killed. The benefit of a cartel ends at that point. Russia has deliberately hoarded fertilizer since 2021 to simultaneously damage western output and boost output from Ukrainian and Russian farms. With the benefit of hindsight, that fertilizer export limit decision, told us, in spades, the end game of Putin


An economic analysis for the invasion of the Ukraine does not support engagement, on any level, using nuclear weapons; but a total conventional eradication of the entire Ukrainian population and the elimination of Ukraine as a formal country is possible, while still supporting the aims of Putin. Russia could eventually import Chinese and Indian laborers to run the farms.

Those arguing against the direct military support of Ukraine by the west ask the same question ad nauseam: “why is the direct defense of Ukraine in OUR national interest?”

Russia deliberately withheld wheat from Ukraine in the 1930’s, leading to the mass starvation event known as Holodomor. When Putin gains monopoly control of the global wheat market, he can, and likely will, do it again. Our sanctions, such as they are, have made him angrier, more vengeful. This is our national interest, putting food in our bellies and maintaining an ability to control inflation internally, using conventional fiscal and monetary policy tools. Our global policy wonks have wholly underestimated the importance of Ukraine, because nobody has ever bothered to model the creation of an OPEC style combine in food production. As a result of that oversight, we left THE key supply line completely unguarded and it has been seized.

Should my assessment even be partially correct, the EU, America, other NATO members, and practically any other democracy should clearly be doing more, to the point that a western full-scale military intervention seems a logical response in order to defeat the formation of an anti-democratic food cartel. Food security has historically proven to be worth fighting for, and perhaps, dying for.

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