Category Economics

The Russo-Ukrainian War is still a limited war

It may not feel that way to a lot of the participants, but the Russo-Ukrainian War is still a limited war. It is not like WWI or WWII and is not likely the opening shots in WWIII. It is a limited war over limited territorial objectives. For Ukraine, it is nominally a war for national survival, but it is not for Russia.

The economic commitment of two sides is limited. In 2023, Russia committed only 4.1% of its economy to defense spending. I gather it is now about 7% for 2024. Ukraine in 2023 was committing a stated 37% to defense. In a full scale war you would expect to see 25% or more. For the Ukrainian allies, it is a lot less. In all cases, their percent of aid to Ukraine is less than 1% (Estonia provided 1.4% of its GDP in 2022). In most cases, it is well less than 1%. Their actual total defense spending of our NATO allies varies between 1.2 and 3%, with the U.S. spending 3.47% on defense in 2022. The latest U.S. aid package of $61 billion was 0.2 percent of our economy (our GDP is almost 29 Trillion). To put it in dollars and sense terms, if your income was $60,000 a year, it would be like contributing $127 to Ukraine.

And then there is mobilization. The Russian Armed Forces are 1,320,000 or 0.9% of their population of 146 million. The Ukrainian Armed Forces are 1,250,000+ or 3.7% of their population of 33 million. These are not particularly high mobilization figures for Russia and not maximized mobilization for Ukraine. For example, Ukraine is not drafting people under 25. I remember we were sending a lot of 18-year olds to Vietnam (and my older brother did get his draft number). For the record, the U.S. Armed Forces is 1,328,000 or 0.4% of our population of 334 million.

Now the actual size of the forces deployed forward are much smaller. We are estimating 450-617K for the Russians and 300-400K for the Ukrainians.

Although it was clear that the Russian objectives in 2022 were to eliminate Zelenskyy and occupy Kyiv, they have considerably reduced their objectives (thanks to failure of their operations in 2022 and the stiff defense put up by the Ukrainians). Now their objectives are four provinces (Lugansk, Donetsk, Zaporizhzhia and Kherson) in addition to continuing to hold onto Crimea and Sevastopol. Of those four provinces, Russian currently controls almost all of one and the majority of the territory in the other three. It does not control the capital city or the majority of the population in two of those three provinces. It claims all four and have officially annexed them. Russia has stated that turning over control of these four provinces are the conditions for peace. It will be a while before we see peace there.

Finally, losses are not at WWI and WWII levels. Ukrainian combat killed is at least 30,000 and probably at least twice that.  Russian killed is at least 60,000 and probably higher. Ukrainian civilian deaths are at least 10,000 and probably higher. Total military deaths in WWI were over 9 million. Total military deaths killed in WWII was over 24 million and civilian deaths maybe 49 million. Total killed in Korea was 2-3 million of which 33,686 were U.S. killed and 7,586 were U.S. missing (almost certainly all were killed). Total killed in the Vietnam War was 1 to 2 million, of which 58,281 were U.S. killed and 1,584 are still missing in action. These last two are considered limited wars. 

So yes, the Russo-Ukrainian War is a limited war. It is also a war of national survival for Ukraine, for if they negotiate at a loss (i.e. surrender Lugansk or Donetsk provinces, or conduct a cease fire in place), then there is a high probability that this will not be the last Russo-Ukrainian War. 

Dueling Defense Budgets

The cold hard reality is that in the long run $$$ = combat power. This is a obvious little relationship that is often ignored. This was demonstrated in spades when Japan attacked a country in 1941 that had an economy more than ten times their size. Good luck with that one. It was also ignored by the leader of Germany, who somehow or the other believed that superior willpower go overcome the overwhelming coalition arrayed against them. He could not. In the long run, warfare is decided by the golden rule: he who has the gold – rules. So, let us take a moment and look at the defense budget of Russia vs Ukraine. 

Russia defense budget in 2023, according to Wikipedia, was $86.4B. Source was the Stockholm International Peace Research Institute (SIPRI), from back in the days when Sweden was neutral. Now maybe this should be adjusted by PPP (Purchasing Power Parity) to account for lower labor costs, lower food costs, etc.  The PPP multiplier for the GDP is 2.66. Meaning that their real value of the budget is somewhere between 86.4 to 229.8. Hard to say how much of military expenditures should be under PPP, especially when one is talking about all the high-tech equipment that makes up a modern army. The 2024 budget is higher, that is discussed below. Their 2023 budget only make of 4.1% of the GDP, so there is room to grow. Russia is receiving no significant outside aid to support this war (they have to pay for the material from Iran, China and North Korea). 

Ukraine on the other hand is receiving lots of outside aid. At least $110B a year. This includes over $50 billion from the EU & UK, and at least $61B from the U.S. Much of this is spent in their home countries for equipment, so is not directly comparable to the PPP adjusted Russian figures. On the other hand, in 2024 Ukraine is spending $66.2 billion of its own money on the war (source: Ministry of Finance of Ukraine). This is 18% of their GDP. Sort of gives you some idea of what Russia might be capable of if the political will was there (so I guess willpower does matter). One of course, has to ask, why is the political will not there? What is the dynamics where Ukraine has spent 18% of their national income on the war while Russia, which initiated this war, is only spending 4%. What is the Kremlin afraid of? Their own people?

Anyhow, $66B that Ukraine is spending also needs to be adjusted by PPP. Their multiplier is 2.73. So that $66B turns into $180.2. So 180 vs 230. 1-to-1.28 ratio of expenditures. But to that Ukraine adds a least $111B in Western money. So, 181 + 111 vs 230 or a 1.27-to-1. This is of course assuming that PPP is a fully valid measurement and none of the western aid is influenced by PPP. Neither of these are quite the case. If it was a simple nominal expense comparison it would be 66 + 111 vs 86 or a ratio of 2.06-to-1.

From a practical point of view, it appears that Ukraine with western aid is outspending Russian by at least 50%. Of course, I am comparing here Ukrainian 2024 figures to Russian 2023 figures. In the long run, that means that Ukraine will win. More than likely, it will force Russia to increase it defenses expenditures by at least 50%, up to 6% or more of GDP. This is sustainable. 

Now, the linked article below shows that Russia’s 2024 defense expenditure is 40% (or 39% in another article) of their national budget, which 391.2 x .4 = 156.48. They say it is a 70% increase from 2023 (86.4 x 1.7 = 146.88). Anyhow, they are having to increase their budget significantly. See: Putin approves big military spending hikes for Russia’s budget | Reuters

So, 146.88 x 2.66 (PPP multiplier) = 391. So 181 + 111 vs 391 is a 1-to1.34 ratio based upon PPP for both Russia and Ukraine. Or… 66 + 111 vs 147 is a 1.20-to-1 ratio in favor of Ukraine based upon nominal costs. So it does appear that for 2024 the two sides expenditures appear to be roughly equal. This would imply that a rough stalemate is going to be the outcome in 2024.

Now, this is a rough back-of-the-envelope calculation banged out this morning. Something more rigorous could be developed by someone. I am not sure it would tell a different story.

Top Ten Blog posts in 2023

Happy New Year to all. 2023 is over. Not the best year for many in the world. Wanted to take a moment to list out our top ten blog posts for 2023 (based upon number of hits). They are:

  1. Wounded-to-killed ratios in Ukraine in 2022 | Mystics & Statistics (dupuyinstitute.org)
  2. U.S. Tank Losses and Crew Casualties in World War II | Mystics & Statistics (dupuyinstitute.org) – a blog post by Dr. Shawn Woodford from 2016.
  3. How many brigades did Ukraine start with war with? | Mystics & Statistics (dupuyinstitute.org) – this is actually clipped from my book The Battle for Kyiv.
  4. Population over Time (US vs USSR) | Mystics & Statistics (dupuyinstitute.org) – a blog post from 2018. I suspect this gets so many hits because this was the initial entry point for a number of people who periodically check on this blog and they continue to use this post to direct them to our blog.
  5. German versus Soviet Artillery at Kursk | Mystics & Statistics (dupuyinstitute.org) – another 2018 blog post.
  6. New WWII German Maps At The National Archives | Mystics & Statistics (dupuyinstitute.org) – a 2017 blog post by Dr. Shawn Woodford.
  7. How Does the U.S. Army Calculate Combat Power? ¯\_(ツ)_/¯ | Mystics & Statistics (dupuyinstitute.org) – another 2017 blog post by Dr. Shawn Woodford.
  8. Tank Loss Rates in Combat: Then and Now | Mystics & Statistics (dupuyinstitute.org) – a 2016 blog post by Dr. Shawn Woodford.
  9. U.S. Army Force Ratios | Mystics & Statistics (dupuyinstitute.org) – a 2018 blog post.
  10. The Russian Artillery Strike That Spooked The U.S. Army | Mystics & Statistics (dupuyinstitute.org) – a 2017 blog post by Dr. Shawn Woodford. It was the second most popular blog post in 2022.

Honorable mentions:

13. Wounded-To-Killed Ratios | Mystics & Statistics (dupuyinstitute.org) – this 2016 blog post was our most popular blog post in 2022.

16. Where Did Japan Go? | Mystics & Statistics (dupuyinstitute.org) – this 2018 blog post was sort of the culmination of our series of demographic blog posts. May revisit this subject again this year.

18. The Russo-Ukrainian War – Day 560 | Mystics & Statistics (dupuyinstitute.org) – for a while we did post daily (then two-three times a week) about the war in Ukraine. This was our most popular one of those posts. We will probably restart these again sometime this winter, like when there is a danger of the front lines again moving.

 

Anyhow, the blog has been quieter for the last three months. This was in part because I was on travel and in part because I needed to finish up a book (The Siege of Mariupol). To date, I have not learned how to multi-task and complete a book, so the book has had the priority. Sorry to anyone I have not responded to as a result.

The Battle for Kyiv book will be available in the U.S. on Amazon.com come 18 January 2024.

“France has delivered almost nothing”

Interview with Anders Fogh Rasmussen, the secretary-general of NATO from 2009-2014: ‘France Has Delivered Almost Nothing’ (msn.com). Several quotable lines from that interview like: “Putin wanted less NATO. He got more NATO.” He does make the claim that: “France has delivered almost nothing. The scale of French deliveries is equivalent to what Denmark has offered – valued at $160 million.”

To maintain this war, my off-the-cuff estimate is that we collectively need to provide Ukraine $100-$120 billion (with a b) a year of military and economic aid. This has been done for 2022, but needs to be done for 2023, 2024, etc. 

There is a “Ukraine Support Tracker” offered by the Kiel Institute for the World Economy. This is worth looking at in depth: Ukraine Support Tracker | Kiel Institute (ifw-kiel.de).

A few highlights from this tracker:

  1. Aid commitments by country: 
    1. U.S.: 42.6 billion (Euros)
    2. EU: 15.7 billion
    3. UK: @ 6 billion (eyeballing the chart)
    4. Germany: @ < 4 billion
    5. Poland: @ 3 billion
    6. Canada: @ 3 billion
    7. France: @ 2 billion
    8. Japan: @ 1 billion
  2. No total given, but it is around 80 billion according to an eyeball examination of this chart. Other estimates have been higher.
  3. Aid as a percent of GDP (including EU contributions):
    1. Estonia: 1.0%
    2. Latvia: 0.8%
    3. Poland: 0.6%
    4. Slovakia, Lithuania, Greece, Czechia: 0.3%
    5. UK: 0.2%
    6. U.S.: 0.2%
    7. Portugal, Denmark: 0.2%
    8. France, Germany, Sweden, Canada, Norway, etc.: less than 0.2% (but 0.2% if rounded up).

Anyhow, it does not seem that France is lagging behind the rest of the European countries. Rasmussen seems overly harsh in his condemnation. France is primarily providing financial aid, vice military aid. The journalist linked to the Kiel Institute in his article, leading me to suspect he had doubts about Rasmussen’s statement, but did not contend with him over it in the interview. All the major European and NATO countries appear to be contributing at least 0.2% of their GDP to Ukraine (if you include their share of EU aid). See this blown-up chart which also tracks EU aide: Government support to Ukraine: By donor country GDP, incl. and excl. EU share (23degrees.io).

The Russo-Ukrainian War of 2022 – Day 87 (ground actions)

 

The big news of the week occurred off the battlefield, with the U.S. congress approving a $40 billion aid bill for Ukraine. That along with previous aid from dozens of other countries ($20-$25 billion), new economic aid from the G-7 (now reported at $19.8 billion), the previous U.S. aid bill in March ($13 billion), and so forth, is pushing the amount of aid this year towards $100 billion (40 + 25 + 19.8 + 13 = 98). This is enough to match the entire Russian 2021 defense budget of 61.7 billion and keep the Ukrainian economy afloat. It means that Ukraine can stay in this war for an extended fight. It changes the strategic balance and strategic considerations.

On the ground, the only place with much action is around Popasna, south of Sievierodonetsk. Not sure how serious this is. I will put any changes/updates since my last post in italics. A link to a blow up of the map is here: Wikipedia map

The map below from 20 May is borrowed from Dr. Michael Mackay @mhmck. The area threatened with encirclement contain the cities of Sievierdonetsk and Lysychansk and surrounding areas which had a population in excess of 350,000. One can see the expansion around Popasna.

Rain later today (100%) and forecasted for Sunday (50%) and next Thursday and Friday. If we don’t see any major offensives from Russian in the next two weeks, then does this mean that they will not occur this year?

Ukraine has made some advances around Kharkov. Not sure if this is because they have put together a powerful offensive force, the Russian morale is collapsing, or because the Russians have thinned this out to mass elsewhere for an offensive. Suspect the latter. Map showing front lines near Kharkov on 27 April and 17 May (cribbed from @War_Mapper), with the 17 May map showing the taking of Dementiivka.

Around Izium, Russia took one village near Lyman on 8 May and on 9 May took Velyka Komyshuvahka. This front appears quiet right now. Another map cribbed from @War_Mapper dated 9 May: 

Still waiting for Russia to start its main offensive in earnest. It does appear that they thinned their forces around Kharkov and concentrated everything around Izium. 

The real objective here seems to be the cities of Siervierdonetsk (pop. 101,135), Lysychansk (pop. 95,031), Sloviansk (pop. 106,972) and Kramatorsk (pop. 150,084) in the Lugansk and Donetsk provinces. These are all very close to each other. Is Russia going to limit themselves to cleaning up the rest of the areas claimed by the LPR and DPR (and then try to negotiate a cease fire), or are they going to strike towards other areas, like Kharkov and Dnipro?

It appears that Kiev, Chernigov, Sumy and the northeast part of Ukraine are secure. Of course, Russia can always reintroduce troops later from Russia or Belarus. They are supposed to have around 20 BTGs in Russia. A Ukranian border guard was killed on 16 May near Sumy.

The U.S. DOD is reporting that the Russian forces in Ukraine are being reinforced, with the count of BTGs going up from 92 to 105 (now 106). It this preparation for a big push in a week or two?

Russia now occupies four cities, Mariupol (pop. 431,859), Berdyansk (pop. 107,928), Melitopol (pop. 150,768) and Kherson (pop. 283,649). 

We are looking at six major areas of operations right now.

1. Kiev – secure

2. Odessa – secure

3. Kharkov – secure?

4. The Donetsk and Lugansk provinces
5. Mariupol – operations completed?
6. Crimean border/Kherson

Here is what I have heard/seen from open sources:

1. Kiev (pop: 2,962,180): It appears that Kiev is secure. 

2. Odessa (pop: 1,015,826): Appears to be secure.

3. Kharkov (pop: 1,433,886): Kharkov looks to be securely held but is still being shelled. It is not yet out of artillery range, but probably will be soon if the Ukrainian army continues pushing the Russian army away from Kharkov. 

It does appear that Russia has thinned out its forces in this area and Ukraine is taking advantage of that. They are still fighting over a front of over 900 kilometers or 600 miles (this is a rough eyeball guess; I have not measured it exactly as it does twist and turn). Russia supposedly now has 106 BTGs deployed in Ukraine, so if one is concentrating forces around Izium, still has a couple BTGs tied down in Mariupol, still has some holding Kherson, the area NE of Kherson, Melitopol and surrounding areas, etc., then this does not leave a whole lot for the Kharkov area. This is a problem Russia has warring with a defender who is roughly equal in deployed manpower.

There was an explosion on 3 May in the Belgorod region at Tomorovka (map in my Kursk book). A rail bridge also went down near Kursk. The provincial governor said it was sabotage. On 26 April an ammo depot near Belgorod, Russia was attacked. There was also a major fire also reported at an oil storage facility this last week in the Bryansk region near the border. There was a report this weekend of a Ukrainian aircraft “shelling” a village of Zhecha in the Bryansk Region in Russia. It was reported on May 11 by the governor of Belgorod province that a Russian civilian was killed and three were injured by a shelling of the village of Solokhi. This is the first Russian civilian killed inside of Russia during this war.

The Russians continued to expand southward from Izium, which is listed here as it is in the Kharkov Province even though their advance is heading south. They have captured the town of Zavody and the NE outskirts of Velyka Komyshuvakha. The Russians do appear to have been pushing to the southwest towards Barvinkove (pop. 8,110), vice the south or southeast. So it is either a broader encirclement of Slavyansk and Kramatorsk, or the rumored drive on Dnipro (which I really don’t believe they are going to try). Still, no villages have been reported taken in this area for the last few days. Are they taking a breather before the start of the main offensive?

A video from Sky News from Barvinkove (3:58): Ukraine War: Ukrainian soldiers stand firm in Barvinkove. Trench warfare (2:14)?

The Russians have two options for an encirclement of the Ukrainian areas of Lugansk and Donetsk province. One is the “smaller option” of striking from Kreminna and near Soledar to surround Sieverierodonesk and Lysychansk. The other is a “larger option” to strike from Izium and surround Sloviansk and Kramatorsk also. They may try both. If they are doing that, then I assume options like a renewed assault on Kharkov or a drive towards Dnipro (which is a good distance away) are off the table. 

On the other hand, depending on how the Ukrainian offensive develops around Kharkov and if any forces are freed from it, it is possible that some Ukranian forces (i.e. 92nd and 93d Mechanized Brigades) could be turned south towards Izium, greatly complicating the Russian offensive there. Izium is only 60 miles southeast of Kharkov. According to one newspaper account (Forbes), advancing out of Izium are a dozen of Russia’s “best” BTGs. The Ukrainian forces defending south of Izium include the 4th and 17th Tank Brigades and 95th Air Assault Brigade. 

4. The Donetsk and Lugansk provinces: The Russians have advanced to the northern outskirts of Sievierdonetsk. The city is being surrounded on three sides. The city is being shelled and according to Ukraine only 15,000 civilians remain in the city.

Sievierodonetsk (pop. 101,135) might soon come under direct assault or possibly siege. It is already in danger of being surrounded, with Russian or DPR forces near Bakhmut (pop. 72,310) and Soledar (pop.10,692) and pushing down from the north from Kreminna and Rubizhne and from the south from Novotoshkivske. Due west of Sievierodonesk Russia did erect a pontoon bridge across the Siversky Donets River near Bilohorivka (pop. 828), where an airstrike on 7 May killed around 60 civilians. The Ukrainians did take down the ponton bridge at Bilohorivka on 9 May and pictures show a second pontoon bridge also taken down thereNot sure if a third bridge was erected and taken down. This has been done with heavy Russia losses, perhaps the better part of one BTG. People have been counting destroyed vehicles from satellite and aerial images, with some estimates (Forbes) as high as 50 “tanks” lost. Other reports estimate Russian losses at 485 out of 550 soldiers and 80 armored vehicles from the 74th Motorized Rifle Brigade. While these are estimates, it does seem that some people are reporting it as fact.

The Russians are reported to be advancing to the south of Sievierodonetsk.. Popasna (pop. 19,672) has been in Russian hands since 7 May. Oleksandropillia did fall to the Russians, probably around 12 May. The Ukrainian general staff report today (20 May) said “Russian occupants suffered losses in the area of the settlement of Oleksandropillia.” While lot of people are leaning on these daily reports to determine what it happening, it is clear that they do not always immediately report losses of areas. On the other hand, the latest maps from @mhmck are still showing Oleksandropillia in Ukrainian hands. 

The Russians are reported pushing in the direction of Zolote (pop. 13,203) and Komyshuvakha. Reports have also indicated that they have expanded in the area just south of Poposna, sort of fattening the finger pushing into Ukrainian lines. The Russians are reported to have captured Vrubivka (pop. 889), just north of Popasna, and Druzhba, just west of Popasna (see @war_mapper). Do not have confirmation of those two villages being taken. The map below is from 20 May by @War_Mapper. The advance out of Popasna looks particularly threatening.

Article in Forbes about the fighting around Popasna. The Russians are throwing everything they’ve got at one Ukrainian garrison. They do claim that Sievierodonetsk is defended by “three or so” Ukrainian brigades that “included 5,000 or more troops.” Don’t know the size of a Ukrainian brigade right now, but those manpower figures seem low.

Further south Avdiyivka (31,940) is still in Ukranian hands but is being shelled. Ukraine claimed on 27 April that Avdiyivka was hit twice by phosphorus munitions. They are reported pushing towards Kamyanka and Novoselivka, to its north.

Slovyansk (pop. 106,972) and Kramatorsk (pop. 150,084) appear safe for now. Kramatorsk had its rail station hit on 9 April with over 50 civilians killed.

To the southwest of this fight, the Ukrainians have retaken Maryinka (pop. 9,256) on 19 April, which had been taken by the DPR on 17 March. 

The Donetsk People’s Republic (DPR) is reporting as of 19 May that they had 1,808 soldiers killed and 7,536 wounded (4.17-to-1 wounded-to-killed ratio) out of a supposed strength of 20,000. This is 47% casualties out of an estimated force of 20,000, which is pretty serious. They have been surprisingly diligent about regularly reporting their casualty figures. One wonders if some Russian losses or contractors are being included in these figures. Lugansk People’s Republic (LPR) is reported as of 5 April to have had 500-600 killed out of an estimated force of 14,000. This is 21% casualties, assuming a 4-to-1 killed ratio. Don’t know how many of DPR and LPR forces are Russians from Russia as opposed to locals.

Zelensky in an interview on CNN on 17 April said they had 44,000 professional military men in the Donbas.

5. Mariupol (pop: 431,859): The siege lasted seventy-seven days. As of 17 May, Mariupol is under control of Russia although they declared on 20 May that they had “completely liberated” the steel works. It apparently took a couple of days for everyone to surrender, including another 531 Ukranian troops. The Alamo held out for 13 days. The Germans surrounded in Stalingrad held out for 72 days. The count of total number of defenders who have surrendered in Mariupol is now around 1,700 soldiers according to the UK. The Russian defense minister says 1,908. So far, none have been exchanged.

The population of the city is down to 100,000 or less. I assume the civilians are not planning to return. The mayor, who is no longer in the city, claimed that more than 10,000 people have been killed. The head of DPR (Donets People’s Republic) has said over 5,000 people have been killed. The city has been decimated, lots of buildings and houses destroyed. Mariupol has no power, gas or water. 

According to the DOD on 18 April there are almost a dozen BTGs in Mariupol. The U.S. DOD claimed a couple of weeks ago that 2,000 troops and some Chechen fighters are still in Mariupol and that 10 BTGs were now moving north. Does this portend an offensive south of Sievierdonetsk pushing north? They do indicate that some of the BTGs appears to have paused to be refitted, which is not all that surprising.

There is a mass grave being reported outside of Mariupol near the town of Manhush. It looks like around 200 graves have been dug. Another mass grave is also being reported on 23 April. So far, they appear to be graves for hundreds of people, vice thousands. A third mass grave has been reported. There has been no new reports on this for a while.

6. Crimea & Kherson (pop: 283,649): Kherson is under Russian control. Are the Ukrainians going to make a push to take back Kherson? My suspicion is that Ukraine is going to launch an operation to try to reclaim Kherson and Kherson Province. Reports are that the fighting is getting heavier there. Ukraine reports fighting around Chornobaivka (pop, 9275 in 2001). It is near Kherson.

 

Weather: Kharkov at 3 PM: 69 degrees (21 Celsius) and cloudy. Low tonight 47 degrees (8 Celsius). Rain forecasted for later today (Saturday 100%) and Sunday (50%) and then clear until Thursday (70%) and Friday (70%). 

Ukrainian Army Build-up: Not sure how large the army now is (assume over 200,000). There is a Ukrainian Territorial Defense Force of 100,000 to 200,000. Wikipedia was reporting 209,000 in their armed forces and 102,000 paramilitary. They are now reporting their armed forces at 196,600. President Zelensky said today that 700,000 soldiers are defending Ukraine. Most of those are militia. The Ukrainian army is around 200,000 and I gather is going to grow to 300,000. It does take a while to build up an army. The upper limited of mobilization is around 5% of the population (there have been cases where it has been higher). So Ukraine with a population of 40 million can build up an army of 2 million, especially if it continues to receive significant outside help. The Russia commentor Col. Kodaryonok stated in his outburst on Russian TV a couple of days ago that “But the situation from the overall strategic position is that the Ukrainian armed forces are able to arm a million people. They’re saying it themselves, that for us, there’s no difficulty in mobilizing a million people. The whole issue is to what extent they’re able to supply this army of modern weapons and military hardware… so a million armed Ukrainian soldiers needs to be viewed as a reality of the very near future.” I would also add that they need to be trained, which takes a while.

The Azov Regiment that was holding in Mariupol was actually a militia unit. That is the case with some of the foreign volunteer battalions also. There are some foreign volunteer units that have been there a while, including two Chechen battalions and a Georgian unit. I have yet to any statistics as to how many other foreign volunteers have been deployed, just individual stories.

There also the independent Belarussian Kastus Kalinouski Battalion, which as of 5 March is reported to have 200 members. They were serving in Irpin (near Kiev). It is reported that they have had thousands of volunteers. The deputy commander of the battalion (age 31) was killed on action on 13 March and another member was lost on 24 March in Irpin. On 16 May it was reported that a company commander had been killed. They state that a total of six Belarussians had died in this battalion since February. This, of course, threatens to bring the war into Belarus at some point.

Outside support for Ukraine is considerable and reported in a separate blog post: Outside Support for Ukraine | Mystics & Statistics (dupuyinstitute.org). Not sure I am going to update this.

The U.S. is now admitting that it helped target Russian generals. See: American intel used to kill Russian generals in Ukraine: US officials. This is something we had assumed for a while. See:  How Much is U.S. Intelligence helping Ukraine? | Mystics & Statistics (dupuyinstitute.org) and How Much is U.S. intelligence helping Ukraine? – part 2 | Mystics & Statistics (dupuyinstitute.org). And then yesterday they admitted that U.S. intel helped with tracking the sunk Russian cruiser Moskva, some we also assumed: Official: US gave intel before Ukraine sank Russian warship. Apparently, they did not provide specific targeting information. A group of Russian officers were hit 17 May in the Russian occupied city of Melitopol. Ukraine claims it was done by “partisans.” They are also reporting attacking an armored train. If true, this opens a whole new dimension to this war.

Russian Army Build-up:  I have yet to see many reports of Russia expanding its army or calling up more reserves and conscripts. Their biannual call-up starts on 1 April, and Putin just signed a decree ordering up 134,500 new conscripts into the army. See the comments in the Day 35 for a discussion on the significance of this. We are now in the tenth week of the war. Are they going to expand their army as Ukraine is clearly expanding theirs, or are they expecting that this war will end shortly? It looks like the Russian Army is adding a couple of thousand volunteers. The U.S. DOD told reporters on 8 April that the Russia could be looking to recruit as many as 60,000 soldiers to join the fight. I don’t know what that really means. Who? From where? What will be their training? How long will it take?

Opposing forces: Ukraine had before the war an army (ground forces) of 169,000 in 2016. The Russian army (not armed forces) was 280,000. The current Ukrainian army is now probably over 200,000. The Russian army (ground forces) in and around Ukraine is probably around 150,000 (up to 190,000). Donetsk PR is estimated at 20,000 and Lugansk at 14,000. Russia may be able to add more forces from their own resources, but not much more. If they want to add more, they are going to have to mobilize. Russia appears to be hesitant to do so. I suspect with full mobilization; we could be looking at a Ukrainian army larger than 300,000. People are now even talking about a Ukrainian armed force of 700,000 to 1,000,000. At some point, Russia will have to mobilize to continue this war. I do not think Russia can win this war without further mobilization. If fact, with the increased aid flowing into Ukraine, Russia may very well end up losing territory it currently holds without additional mobilization. The failure to mobilize is hard to explain from a military point of view. It is clearly a result of domestic political concerns.

Economics and the Home Fronts: The discussion of the economic situation and the home fronts has been updated in a separate rambling blog postThe Home Fronts during the Russo-Ukrainian War – update 2 | Mystics & Statistics (dupuyinstitute.org). This blog post does discuss the bigger, long-term picture.

Casualties: Ukraine admitted on 29 April that they have suffered “serious losses” in battles. We take that claim at face value. They also claim that Russian losses are “colossal.” That claim has not been confirmed. Zelensky told CNN on 15 April that Ukrainian Army had lost between 2,500-3,000 troops since the fighting has begun and about 10,000 have been wounded (wounded-to-killed ratio of 4.00- or 3.33-to-1). According to NYT the U.S. intelligence estimates as of 19 April are between 5,500 to 11,000 Ukrainians killed and between 7,000 to 10,000 Russians killed.

Ukraine is claiming as of 19 April that 20,800 Russian and DPR soldiers have been killed, Russians are claiming as of 16 April that 23,367 Ukrainian soldiers have been killed. Are both sets of figures similarly inflated? It does argue that losses on both sides are similar in size.

Prisoner swap of wounded Ukrainians trapped in Mariupol appears to have been negotiated. They have been doing prisoners swaps for months now, which is always an encouraging sign. I gather that the 53 seriously wounded prisoners are being swapped. Don’t know about the rest of the people.

The UN is reporting on 19 May at least 3,838 civilians confirmed dead in the war. Of those 2,119 of the deaths are in the regions of Donetsk and Luhansk with 127 killed in territory controlled by Russian separatists. Ukraine is reporting that as of 25 April, 3,818 civilians were killed in Ukraine. This is not that far from the UN figure. One wonders if the claimed Mariupol casualties are included in these figures. The rate of accrual of reported civilian casualties has gone down. 

It is clear that more than 12,000 people have died in this conflict (1,351 (Russian Army) + at least 2,000 more (Russian Army) + 3,000 (Ukrainian Army) + 3,838 (Civilians) + 1,808 (DPR) + 600 (LPR) = 12,597). It is probably in excess of 18,000 total deaths depending on Ukrainian and Russian military deaths and the real count of civilian losses. The number of deaths of Mariupol are unverified and unknown and could add thousands to these totals.

A more detailed discussion is provided here. It will be updated soon: Losses during the Russo-Ukrainian War of 2022 | Mystics & Statistics (dupuyinstitute.org)

Air Power: The Pentagon on 12 March is reporting that Russia is flying about 200 sorties a day. The Ukrainian air force has 56 operational jets flying 5 to 10 hours a day. March 22 it was reported by the U.S. that Russia flew more than 300 sorties into Ukraine. March 24 it was reported that more than 250 Russian sorties were flown, mostly around Kiev and Kharkov. On 12 May, the U.S. was claiming that the Russians flew 300 sorties over Ukraine in the last 24 hours. On 14 May they were claiming 250 Russian sorties. It has been pretty consistent reporting of 250-300 sorties a day for quite some time now.

The pilot Major Stepan Tarabalka, age 29, died on 13 March piloting a MiG-29. Some claimed he was the “Ghost of Kiev.” The Ukrainians claim as of 30 April 190 Russian aircraft destroyed, and the “Ghost of Kiev” is credited with 40 kills. The videos evidence has confirmed as of 2 May that 23 Russian jets destroyed. 

Somewhat relevant (23 x 8 = 184): 

Soviet versus German kill claims at Kursk | Mystics & Statistics (dupuyinstitute.org)

The publisher has posted a publication date of 6 November on Amazon.com:

Aces at Kursk – Summation | Mystics & Statistics (dupuyinstitute.org)

Missile Defense: According to Zelenskyy the missile barrage near Lvov on 12 March consisted of 30 missiles, 8 missiles that landed and 22 missiles that were intercepted and shot down. On the morning of 16 April in the Lvov region, Ukraine claimed it downed four cruise missiles fired by Su-35s operating from Belarus. Zelensky claimed on 26 April that Russians have fired more than 1,100 missiles at Ukraine. The U.S. DOD claimed on 29 April that more than 1,950 missiles have been fired at Ukraine since the start of the war and they are currently firing about 50 a day.

End of the War: It does look like Russia intends to take and hold onto all of Donetsk and Lugansk provinces, and possibly all of Kherson province and four-fifths of Zaporizhzhia province. The capital Zaporizhzhia (pop. 722,713) may not be on their list of areas to take. So, four out of Ukraine’s 24 provinces and Crimea.

Populations of partly or completely occupied areas (2019 estimates):

Donetsk: 4,165,901

Lugansk: 2,151,833

Crimea: 2,033,700 (2001 census)

Zaporizhzhia: 1,705,836

Kherson: 1,037,640

Sevastopol: 509,992 (2021 estimate)

 

Population of Ukraine (excluding Crimea), 2022 estimate: 41,167,336

What they are willing to later negotiate away to achieve peace or a ceasefire is unknown. What Ukraine is willing to negotiate away is also unknown, although they are now saying the war will continue until all areas are freed. Does that include the LPR, DPR and Crimea? When they are ready to return to talks is unknown. This looks like an extended war and I don’t think will be over before the end of summer. At this point, unless Russia mobilizes, it will slowly turn to Ukraine’s advantage.

Atrocities: The stories coming out of Bucha are pretty appalling. At least seven civilians have been reported killed in incidents not related to combat, 18 civilians were found dead in a basement, and another 20 civilians were found lying dead in the street, two with hands bound. The mayor of Bucha says they were executed. There are other claims scattered about Ukraine. How extensive and widespread this is still not certain, but this appears to be well beyond what one would expect from “collateral damage” from combat, and some appears to be deliberate. It does indicate, as a minimum, a lack of military discipline in some Russian units. This story is continually being updated right now. The latest figure (12 April) is that 403 civilians were killed in Bucha. The deputy mayor of Bucha says that 50 of the victims have been confirmed as extrajudicially executed. Additional reports from Ukraine have put the body count of civilians found in the towns and villages surround Kiev at 1,222. This has not been independently confirmed. Ukraine has identified ten Russian soldiers wanted for “pre-mediated murder” in Bucha. They are all enlisted from the 64th Guards Motor Rifle Brigade. These are the first charges unveiled of over 8,000 criminal investigations. The U.S. is claiming it has “credible information” of Russians killing Ukrainians in the vicinity of Donetsk who were trying to surrender.

There are also various accusations against the Russian Army Chechen unit operating around Bucha: Brutal Sect of Putin’s Army Accused of Murdering Their Own Comrades.

More claims of atrocities coming out with videos of Russian troops shooting two civilians outside of Kiev in March. Ukraine has also put a POW on trial for the shooting a civilian who was talking on his phone. See: https://www.yahoo.com/news/first-russian-soldier-tried-murder-121607575.html

There is also a video out there of Ukrainian soldiers shooting several Russian prisoners in their legs. There is a second video showing Ukrainian troops executing what appears to be four Russian prisoners seven miles SW of Bucha. See: https://news.yahoo.com/video-appears-show-ukrainian-soldiers-192219323.html. More detailed description from BBC: https://www.bbc.com/news/61025388. It is on Youtube, if you want to look it up. I believe they are members of the Georgian Legion, a group of Georgian volunteers fighting for Ukraine.

There are also some retribution killings going on: Ukrainian Chief Intelligence Directorate: another traitor of Ukraine found shot.

Other Issues: Azerbaijani troops have occupied an area in Nagorno-Karabakh that they are claiming is theirs. The Russian peacekeeping troops there have not expelled them. Widespread protests in Armenia this weekend over Nagorno-Karabakh followed by 180 detentions. There were more protests this Sunday and another 237 protesters were detained. On 10 May another 61 protesters were detained.

NATO has confirmed 18 May that both Finland and Sweden have officially applied to join NATO. NATO has said it will welcome them with open armsThe process of accepting them is expected to take about two weeks and they could be members within a few months. It does require unanimous consent of all 30 members for them to join NATO. Turkey is withholding consent until there is some resolution concerning some weapons embargoes against Turkey and the presence in Sweden of Kurdish refugees wanted by Turkey. It does add an 810-mile (1300 km) border with Russia, but NATO already abuts Russian and Belarussian territory in the Baltic states. 

Ukraine was supposed to be on the fast track to join the European Union (EU), which was the issue that started all the turmoil in 2013. But EU member Austria has objected, and now France is saying that it may take years. All EU members must unanimously agree for a country’s membership negotiations to begin. This is the issue that fueled all the conflict over the last nine years, for the Euromaidan revolt occurred when Ukrainian President Yanukovich decided to join Putin’s Eurasian Union vice the EU. The subsequent conflicts included the whole three-month Euromaidan revolt in the dead of winter of 2013-2014 that led to over 100 Ukrainians being killed, many protesters shot in the street by President Yanokovich’s security forces; the seizure of Crimea; the creation of LPR and DPR; the subsequent war; and now this war. Ukraine certainly has paid a much higher cost to join the EU than anyone else ever has. Current polling (Reuters April 5) shows that 91% of the Ukrainians support joining the EU. 

The Ukranian group Kalush Orchestra won the Eurovision Song Contest.

The Map: The attached map is from Wikipedia. It is dated 21 May. Last dated update was 10 May, except for Mariupol which is dated 17 May. It is showing an advance to just outside of Barvinkove and showing advances around Popasnia and Zolote. The maps by @mhmck does not show the advance going all the way to Barvinkove. No two maps are the same.

The Home Fronts during the Russo-Ukrainian War – update 2

Second update to this blog post. The big earthshaking change is that the U.S. Congress has passed a $40.1 billion aid bill for Ukraine. That along with the previously $13.6 billion aid bill passed in March adds up to $53.7 billion from the U.S. alone to Ukraine. One might be able to add to that the $18.4 billion for Ukraine being discussed by the G-7 to total up to $71 billion more for Ukraine. This is on top for the $20 to $25 billion already provided by the international community (see the old blog post below). The Russian defense budget in 2021 was $61.7 billion. The Ukrainian economy was potentially going to lose more than $80 billion over this year because of the war (out of a GDP of $181 billion). So, to be able to keep Ukraine military properly armed, and to support the people there, we are kind of looking at needing about 100 billion or more of aid. It now looks like we are almost there.

Now, there is some questions when looking into these bills in depth. For example, the $13.6 billion passed in March includes 6.5 in military aid, but some of that is for DOD to deploy troops in the region. So, it is not a full $6.5 billion in military aid to Ukraine. There is more than $4 billion in humanitarian aid. Some of that is humanitarian aid for refugees outside of the country, so don’t know to what degree it provides economic support directly to Ukraine. There was 1.8 billion for economic needs in Ukraine and neighboring countries. So, it is hard to sort out exactly how much of this aid is for Ukraine. See: https://www.cnn.com/2022/03/09/politics/ukraine-aid-spending-bill-congress/index.html

The picture is probably more complex for the $40.1 billion bill. I do not have any good breakdown of what is in that bill. It does include $9 billion to replenish depleted U.S. weapon stockpiles, $9 billion for continued operations of the Ukrainian government, and $4 billion in international disaster assistance. See: https://news.yahoo.com/senate-passes-40-billion-ukraine-175423598.html

So not sure exactly where we are at, but we are certainly a good way towards the $100 billion in aid a year that I feel that Ukraine probably needs. 

Now, with around $100 billion in aid a year, not only can Ukraine hold out against Russia, but has the ability to fight back and possibly reclaim territory. This, of course, greatly expands the possibilities and paths for this war. It is no longer a war of strictly defending Ukraine; but may also be a war to reclaim territories taken in 2022, might even become a war to reclaim territories taken in 2014. It does raise all kinds of questions about the duration of the war and how will it be settled. With $100+ billion a year in aid coming in, Ukraine may not be served by agreeing to any peace terms until such time as it gets the conditions that it favors. This war may still be going in 2023.

Anyhow, need to update the figures from my previous blog post but not sure how. Our previous blog post noted $3,285 million in military aid from the U.S. and $1,000 million in humanitarian aid. This was understating the overall amount of U.S. aid. 

 

————previous blog post—————————-

Even though the war is not going well for Russia right now, that might change. Russia still has more than three times the manpower and almost ten times the economy that Ukraine does. Just to compare:

                                  Russia                   Ukraine                 Ratio

Population (2022)    145,478,097          41,167,336             3.53

GDP (2021)               1,710 billion          181 billion             9.45        

per capita                 $11,654                  $4,380                   2.66

GDP (PPP)                4,328 billion         584 billion              7.41

 

Population counts Crimea in the Russia figures. LPR and DPR are nominally counted among the Ukrainian population figures.

Pre-war figures for their armed forces show:

                                   Russia           Ukraine                Ratio

Active personnel      1,014,000       196,600 (2022)       5.16   

Ground forces             280,000       170,600 (2022)       1.64

Budget (2020-2021)  61.7 billion     4.6 (2020)             13.41

Percent GDP (2021)   4.3%              3% (2020)              1.43        

 

2022 Trends: According to estimates from the World Bank the Ukrainian economy is going to shrink by 45% this year. According to various estimates, the Russian economy is going to shrink by 10-20% this year. So, can Ukraine sustain such a war with the international aid it is receiving? The aid they are receiving is provided in a very incomplete list in the following Wikipedia page: List of foreign aid to Ukraine during the Russo-Ukrainian War. This data is very incomplete and we do not have a valuation for a lot of the equipment and goods donated.

Total military aid to Ukraine is at least 9,291 million (? Albania + 225 Aus + ?? Belgium + 584+ Canada + 17 Croatia + 30 Czech + 81 Den + 230 Est + ?? Finland + 125+ France + 1,040+ Germany + ? Greece + ? Icleand + 9 Ire + 114+ Italy + ? Japan + 208+ Latvia + 104+ Lithuania + ? Lux + ? Mont. + 57+ Neth + 11+ NZ + ? N. Macedonia + 44+ Nor + ??? Poland + 11 Port + 3 Rom + 13 Slovakia + ?? Slovenia + ?? S.Korea + ?? Spain + ?? Sweden + ?? Turkey + 1,600 UK + 3,285 US + 1,500 EU). This is a very rough estimate as I don’t have complete figures for many countries. But this figure of 9.3 billion more than doubles what Ukraine spent for it own defense in 2020. On the other hand, it is a fraction of the 61.7 billion Russia spent for defense in 2020-2021.

Total economic and humanitarian aid to Ukraine is at least 8,558 million (? Argentina + 65 Australia + ? Austria + 5 Azer + 1 Bahrain + ? Brazil + ? Bulgaria + 330 Can +  0.1 Chile + 10 China + ? Colombia + .0.3 Croatia + ? Cyprus + 13 Czech + 27 Den + 26 Est + 89 Fin + 2,000 France + ? Georgia + 519 Ger + ? Hungary + ? India + ? Israel + ? Italy + 200 Japan + ? Kazakhstan + 0.1 Kosovo + 2 Kuwait + 0.5 Latvia + 0.5 Liecht + 4 Lith + 1 Malta + 1 Moldova + 0.2 Mongolia + 0.1 Mont + 2 NZ + 208 Nor + ? Pakistan + ??? Poland + 5 Port + 5 Qatar + ? Romania + ? San Marino + 10 SaudiA + 3 Serbia + 3 Singapore + ? Slovenia + 12 S. Korea + 0.2 Spain + 10 Sweden + 80 Swiss + 32 Taiwan + 0.1 Thai + ? Turkey + ? Turkmenistan + ? UAE + 342 UK + 1,000 US + ? Uzbekistan + ? Vatican City + ? Vietnan + 500 EU + 192 companies + 1,359 charities + 1,500 UN + ? IMF). So, over 8.5 billion in economic and humanitarian aid compared to an economy of 181 billion. Now that economy is going to be down maybe 45% for 2022. The economic and humanitarian aid of 8.5 billion is not going to make up the economic shortfall of at least 80 million, and this was not a rich country to start with. 

This is a very poor collection of data and much can be done to improve. But it clearly shows that the military aid, along with Ukraine’s own spending may only be matching 25% of the Russia military spending (9.3 + 4.6 = 13.9/61.7 = 0.23). The economic and humanitarian add may only be making up 10% of Ukraine’s economic shortfall. While all these figures are underestimates, none of this looks good for Ukraine if the war drags on for one or more years.

So, Russia is spending 60 or more billion on its military, it could spend more. Meanwhile, Ukraine was spending maybe 5 billion on its military. It may be able to double that, except its economy is looking at an 80 billion shortfall. Therefore, to achieve some kind of balance, it looks like Ukraine needs to receive a 100 billion or more in outside military, economic and humanitarian aid. Right now, I gather it is receiving around 20 billion (maybe more). Ratcheting the aid up to 100 billion a year does stabilize the situation, but it does not necessarily create victory. So, this may have to be something that continues for years.

It does appear that as this war drags on, it does favor Russia unless aid to Ukraine increases significantly.

 

 

The discussion below is an update to my original posting on the home front.

The Home Front: Count of detained protesters is claimed to be over 14,900 since the war began. See: OVD-info. At least 800 people have been detained in Belarus. There have been only limited protests in the last few weeks.

Exchange rate: The ruble is at 64.72 to a dollar as of 10:03 AM EST. This is “better” than it was before the war began or the last time we reported this. This is mystifying in light of all the other economic news coming out on Russia (see below). The Russian stock market (Moscow exchange) remains closed except for state bonds. As a result of the lower ruble, prices in grocery stores, etc., have returned back to normal. A detailed demonstration of this is provided in this video by Svetlana of Russia (29:36): https://www.youtube.com/watch?v=HK_BKWTaWoU. There gas prices are lower there than here (see 22:15 in the video). Youtube is still up in Russia, although that may not be for long.

Price of oil (Brent crude): $111.41 as of 10:04 AM EST. Several years ago, if the price of oil dropped below $80, the Russian budget would go into the red.

Note that Russia says it received $3.6 million less (302 billion rubles) than it forecast from March old and gas sales. Russia forecasted energy revenue of 790 billion rubles ($9.4 billion) but received around 488 billion rubles., a drop of 38%. The last report I saw, 52% of the Russian government revenue comes from oil (even though it makes up only 7% of their economy). The current Wikipedia article on the Russian economy says that roughly 40% of Russian federal budget comes from the oil and gas sector.

It has been estimated by the World Bank that Ukraine’s economy will shrink by an estimated 45.1% this year (which is a surprising precise estimate in the middle of a war). 

The Russian Ministry of Economy expects 8.8% contraction in 2022. This is a large contraction than anything experienced by the U.S. since the 1930s. Russian estimates of inflation for the next year have ranged from 12.4 percent to as high as 20.7% for the 2022/2023 fiscal year. An independent Western estimate (Capital Economics) project a decline in GDP of 12 percent this year and inflation at 23%. Other Western estimates say GDP will decline by 8.5% (IMF), 10% (European Bank) or 11% (World Bank). Russian inflation rate is currently at 17.62%.

It does appear that the economic impact on Russia will be longer term, as McDonalds and Renault are selling of their businesses in Rusia is now completely pulling out completely.

The value of the ruble seems to have stabilized for the last couple of months at around 64 to 70 per dollar and oil prices at around $100-110. Lower oil prices do undercut the Russian government budget. To further lower the oil prices probably requires the corporation of Saudi Arabia and OPEC. Right now, they are steering a neutral course between the U.S. and Russia, which is kind of questionable on their part.

The Home Fronts during the Russo-Ukrainian War – update 1

Even though the war is not going well for Russia right now, that might change. Russia still has more than three times the manpower and almost ten times the economy that Ukraine does. Just to compare:

                                  Russia                   Ukraine                 Ratio

Population (2022)    145,478,097          41,167,336             3.53

GDP (2021)               1,710 billion          181 billion             9.45        

per capita                 $11,654                  $4,380                   2.66

GDP (PPP)                4,328 billion         584 billion              7.41

 

Population counts Crimea in the Russia figures. LPR and DPR are nominally counted among the Ukrainian population figures.

Pre-war figures for their armed forces show:

                                   Russia           Ukraine                Ratio

Active personnel      1,014,000       196,600 (2022)       5.16   

Ground forces             280,000       170,600 (2022)       1.64

Budget (2020-2021)  61.7 billion     4.6 (2020)             13.41

Percent GDP (2021)   4.3%              3% (2020)              1.43        

 

2022 Trends: According to estimates from the World Bank the Ukrainian economy is going to shrink by 45% this year. According to various estimates, the Russian economy is going to shrink by 10-20% this year. So, can Ukraine sustain such a war with the international aid it is receiving? The aid they are receiving is provided in a very incomplete list in the following Wikipedia page: List of foreign aid to Ukraine during the Russo-Ukrainian War. This data is very incomplete and we do not have a valuation for a lot of the equipment and goods donated.

Total military aid to Ukraine is at least 9,291 million (? Albania + 225 Aus + ?? Belgium + 584+ Canada + 17 Croatia + 30 Czech + 81 Den + 230 Est + ?? Finland + 125+ France + 1,040+ Germany + ? Greece + ? Icleand + 9 Ire + 114+ Italy + ? Japan + 208+ Latvia + 104+ Lithuania + ? Lux + ? Mont. + 57+ Neth + 11+ NZ + ? N. Macedonia + 44+ Nor + ??? Poland + 11 Port + 3 Rom + 13 Slovakia + ?? Slovenia + ?? S.Korea + ?? Spain + ?? Sweden + ?? Turkey + 1,600 UK + 3,285 US + 1,500 EU). This is a very rough estimate as I don’t have complete figures for many countries. But this figure of 9.3 billion more than doubles what Ukraine spent for it own defense in 2020. On the other hand, it is a fraction of the 61.7 billion Russia spent for defense in 2020-2021.

Total economic and humanitarian aid to Ukraine is at least 8,558 million (? Argentina + 65 Australia + ? Austria + 5 Azer + 1 Bahrain + ? Brazil + ? Bulgaria + 330 Can +  0.1 Chile + 10 China + ? Colombia + .0.3 Croatia + ? Cyprus + 13 Czech + 27 Den + 26 Est + 89 Fin + 2,000 France + ? Georgia + 519 Ger + ? Hungary + ? India + ? Israel + ? Italy + 200 Japan + ? Kazakhstan + 0.1 Kosovo + 2 Kuwait + 0.5 Latvia + 0.5 Liecht + 4 Lith + 1 Malta + 1 Moldova + 0.2 Mongolia + 0.1 Mont + 2 NZ + 208 Nor + ? Pakistan + ??? Poland + 5 Port + 5 Qatar + ? Romania + ? San Marino + 10 SaudiA + 3 Serbia + 3 Singapore + ? Slovenia + 12 S. Korea + 0.2 Spain + 10 Sweden + 80 Swiss + 32 Taiwan + 0.1 Thai + ? Turkey + ? Turkmenistan + ? UAE + 342 UK + 1,000 US + ? Uzbekistan + ? Vatican City + ? Vietnan + 500 EU + 192 companies + 1,359 charities + 1,500 UN + ? IMF). So, over 8.5 billion in economic and humanitarian aid compared to an economy of 181 billion. Now that economy is going to be down maybe 45% for 2022. The economic and humanitarian aid of 8.5 billion is not going to make up the economic shortfall of at least 80 million, and this was not a rich country to start with. 

This is a very poor collection of data and much can be done to improve. But it clearly shows that the military aid, along with Ukraine’s own spending may only be matching 25% of the Russia military spending (9.3 + 4.6 = 13.9/61.7 = 0.23). The economic and humanitarian add may only be making up 10% of Ukraine’s economic shortfall. While all these figures are underestimates, none of this looks good for Ukraine if the war drags on for one or more years.

So, Russia is spending 60 or more billion on its military, it could spend more. Meanwhile, Ukraine was spending maybe 5 billion on its military. It may be able to double that, except its economy is looking at an 80 billion shortfall. Therefore, to achieve some kind of balance, it looks like Ukraine needs to receive a 100 billion or more in outside military, economic and humanitarian aid. Right now, I gather it is receiving around 20 billion (maybe more). Ratcheting the aid up to 100 billion a year does stabilize the situation, but it does not necessarily create victory. So, this may have to be something that continues for years.

It does appear that as this war drags on, it does favor Russia unless aid to Ukraine increases significantly.

 

 

The discussion below is an update to my original posting on the home front.

The Home Front: Count of detained protesters is claimed to be over 14,900 since the war began. See: OVD-info. At least 800 people have been detained in Belarus. There have been only limited protests in the last few weeks.

Exchange rate: The ruble is at 64.72 to a dollar as of 10:03 AM EST. This is “better” than it was before the war beganor the last time we reported this. This is mystifying in light of all the other economic news coming out on Russia (see below). The Russian stock market (Moscow exchange) remains closed except for state bonds. As a result of the lower ruble, prices in grocery stores, etc., have returned back to normal. A detailed demonstration of this is provided in this video by Svetlana of Russia (29:36): https://www.youtube.com/watch?v=HK_BKWTaWoU. There gas prices are lower there than here (see 22:15 in the video). Youtube is still up in Russia, although that may not be for long.

Price of oil (Brent crude): $111.41 as of 10:04 AM EST. Several years ago, if the price of oil dropped below $80, the Russian budget would go into the red.

Note that Russia says it received $3.6 million less (302 billion rubles) than it forecast from March old and gas sales. Russia forecasted energy revenue of 790 billion rubles ($9.4 billion) but received around 488 billion rubles., a drop of 38%. The last report I saw, 52% of the Russian government revenue comes from oil (even though it makes up only 7% of their economy). The current Wikipedia article on the Russian economy says that roughly 40% of Russian federal budget comes from the oil and gas sector.

It has been estimated by the World Bank that Ukraine’s economy will shrink by an estimated 45.1% this year (which is a surprising precise estimate in the middle of a war). 

The Russian Ministry of Economy expects 8.8% contraction in 2022. This is a large contraction than anything experienced by the U.S. since the 1930s. Russian estimates of inflation for the next year have ranged from 12.4 percent to as high as 20.7% for the 2022/2023 fiscal year. An independent Western estimate (Capital Economics) project a decline in GDP of 12 percent this year and inflation at 23%. Other Western estimates say GDP will decline by 8.5% (IMF), 10% (European Bank) or 11% (World Bank). Russian inflation rate is currently at 17.62%.

It does appear that the economic impact on Russia will be longer term, as McDonalds and Renault are selling of their businesses in Rusia is now completely pulling out completely.

The value of the ruble seems to have stabilized for the last couple of months at around 64 to 70 per dollar and oil prices at around $100-110. Lower oil prices do undercut the Russian government budget. To further lower the oil prices probably requires the corporation of Saudi Arabia and OPEC. Right now, they are steering a neutral course between the U.S. and Russia, which is kind of questionable on their part.

The Home Fronts during the Russo-Ukranian War

This is a discussion cut from my daily posting on the Russo-Ukrainian War.

The latest video from Moscow: (20+) Facebook

Count of detained protesters is claimed to be over 14,900 since the war began. See: OVD-info. At least 800 people have been detained in Belarus. There have been only limited protests in the last few weeks.

Exchange rate: The ruble is at 67.66 to a dollar as of 9:33 AM EST. This is “better” than it was before the war began. This is mystifying in light of all the other economic news coming out on Russia (see below). The Russian stock market (Moscow exchange) remains closed except for state bonds. As a result of the lower ruble, prices in grocery stores, etc., have returned back to normal. A detailed demonstration of this is provided in this video by Svetlana of Russia (29:36): https://www.youtube.com/watch?v=HK_BKWTaWoU. There gas prices are lower there than here (see 22:15 in the video). Youtube is still up in Russia, although that may not be for long.

Price of oil (Brent crude): $108.81 as of 9:33 AM EST. Several years ago, if the price of oil dropped below $80, the Russian budget would go into the red.

Note that Russia says it received $3.6 million less (302 billion rubles) than it forecast from March old and gas sales. Russia forecasted energy revenue of 790 billion rubles ($9.4 billion) but received around 488 billion rubles., a drop of 38%. The last report I saw, 52% of the Russian government revenue comes from oil (even though it makes up only 7% of their economy). The current Wikipedia article on the Russian economy says that roughly 40% of Russian federal budget comes from the oil and gas sector.

It has been estimated by the World Bank that Ukraine’s economy will shrink by an estimated 45.1% this year (which is a surprising precise estimate in the middle of a war). 

The Russian Ministry of Economy expects 8.8% contraction in 2022. This is a large contraction than anything experienced by the U.S. since the 1930s. Russian estimates of inflation for the next year have ranged from 12.4 percent to as high as 20.7% for the 2022/2023 fiscal year. An independent Western estimate (Capital Economics) project a decline in GDP of 12 percent this year and inflation at 23%. Other Western estimates say GDP will decline by 8.5% (IMF), 10% (European Bank) or 11% (World Bank). Russian inflation rate is currently at 17.62%.

The value of the ruble seems to have stabilized for the last two weeks at around 82 per dollar and oil prices at around $100-110. Lower oil prices do undercut the Russian government budget. To further lower the oil prices probably requires the corporation of Saudi Arabia and OPEC. Right now, they are steering a neutral course between the U.S. and Russia, which is kind of questionable on their part.

Military Aid to Ukraine as measured by percent of GDP

A couple of articles worth looking at. First: Where Military Aid to Ukraine Comes From

This was published three hours ago, showing the total aid “pledged” by each country through 27 March. The U.S. certainly leads in that category with 4.77 billion provided. Biden today just added another 800 million in military aid and 500 million in humanitarian aid in addition to 800 billion in military aid promised in mid-April.

Second on the list is Estonia followed by the UK. Most people can’t find Estonia on a map. It is a small country of only 1.3 million people.

This leads us to the next article here from yesterday: Estonia sent Ukraine aid worth 0.8 percent of GDP in first month of war

It is also from the Kiel Institute for the World Economy and only covers through March 27. It tracks aid “pledged” as a percent of GDP. Estonia is by far the largest there with 0.8% of their GDP dedicated to helping Ukraine. Poland is second. The U.S. is in the middle of the pack. At the bottom of the list is Europe’s economic powerhouse, Germany, followed by Italy and France.

For some reason, NATO member Canada is not listed on this chart but are in the chart above. The numbers appear confused. Also, Germany is providing significant aid above and beyond military aid. This will boost the percent of GDP figures higher if that was used as the metric. Figure 5 is shown below from the Kiel Institute report, provided here as a courtesy of one of the followers of our blog: https://www.ifw-kiel.de/fileadmin/Dateiverwaltung/IfW-Publications/-ifw/Kiel_Working_Paper/2022/KWP_2218_Which_countries_help_Ukraine_and_how_/KWP_2218.pdf.

It clearly shows the additional non-lethal aid being provided by Germany, France, Italy, Spain and Belgium. Still, with the aid figures doubled for Germany, France and Italy, it still does not reach the same level of support as provided by the United States as measured by % of GDP. It certainly does match the level of support provided by Estonia (which is on the front line). The figure above also does not pick up the 1.5 billion in non-lethal aid that the U.S. is providing.

In the end, Germany, France, Italy and the UK probably need to up their game a little bit.

Update: Statista provided an updated chart showing financial, humanitarian and military aid as a percent of GDP, which was figures I did not have at the time. Germany, even when all their non-military aid is included, it still at the bottom of the list, followed by Italy and France. Now, this data only goes through 27 March. We do seem to be seeing a slow readjustment by Germany. As there is only one country between them and Ukraine, you would think they would take a little more seriously.

The new chart is here:

 

U.S. versus China (GDP) – update 1

Dredging up our old posts. This one is from 13 November 2018.

U.S. versus China (GDP) | Mystics & Statistics (dupuyinstitute.org)

As of 2017, U.S. GDP was $19.391 trillion according to the World Bank. The Chinese economy was $12.238 trillion. This was 63% of the U.S. economy.

Now?

Using the World Bank figures for 2019 it is 21.428 trillion for the United States. The Chinese economy is $14.343 trillion. This is 67% of the U.S. economy and these figures pre-date the Covid crisis.

IMF has estimated 2020 figures. I have no idea how relevant or meaningful they area. For the US. it is $%20.807 trillion while for China it is 14.861 trillion. This is 71% of the U.S. economy. Don’t know how much of the Coronavirus issues affected these 2020 IMF figures. China started dealing with Coronavirus in January 2020 while it only became an issue in the United States in March of 2020. China has since brought it under control and are seeing about 200 cases a day. The United States has failed to bring it under control and are looking at something like 180,000 new cases each day. As such, I would expect that China GDP is growing faster than the United States and this will probably also be the case for 2021.

 

P.S.: The U.S. GDP declined 3.5% in 2020. See: https://www.cnn.com/2021/01/28/economy/us-fourth-quarter-gdp/index.html