THE global recession that was anticipated appeared to have become a reality when the US on July 28 announced a GDP contraction of 0.9% for the second quarter of 2022, following a contraction of 1.6% for the first quarter.

Two successive quarterly negative growths are technically a recession. 

Policy wonks in the US Treasury and Federal Reserve are sensitive of using the word “recession”. They prefer to say the economy is not in a recession but merely “slowing down”.

No one is actually saying the US economy is in a recession. Analysts who talk about it say the US economy is strongly heading towards a recession. 

Can’t the US experts tell the difference between an economy in recession, and an economy heading towardsrecession? 

Could this denial of the Biden administration be an admission that the massive sanctions against Russia is a colossal failure that are hurting America and its allies more than they are hurting the target?

Who cares if the US is hit by recession?  As the world’s top economic superpower, there is a lot of truth to the adage that “when the US sneezes, the whole world catches a cold”.

But now Russia and many other countries, including Malaysia, are all doing relatively better than the US and the EU, judging by the latter’s record-breaking inflation rates. The balance of payment data in Russia also looks excellent despite the sanctions.

Or is this denial an attempt to stop international rating agencies from downgrading the US economy and its sovereign rating?

The US stance is that the Ukraine war must be settled on the battlefield instead of at the negotiating table. 

US politicians are for supplying more weapons to Ukraine and rejecting diplomacy. US Representative Dan Crenshaw was gloating over the opportunity to fight Russia with Ukrainian lives when he said: “Investing in the destruction of our adversary’s military without losing a single American troop strikes me as a good idea.” 

US Secretary of State Antony Blinken was more circumspect. He said the US was arming Ukraine to ensure Kyiv would be in “the strongest possible position at any negotiating table that may emerge.”

Although the proxy war might not cause the death of a single US citizen, it could nevertheless make the US a pauper nation with loads of debts.

Isn’t this the familiar path all great powers on earth have treaded before finally falling from the top?

Now how many whammies can the world deal with? We have a triple whammy occurring simultaneously  – pandemic, climate change, and the Ukraine war that has resulted in galloping inflation.

According to UN Secretary-General Antonio Guterres, conflicts around the globe, human rights violations, the climate crisis and the Covid-19 pandemic “have put our world under greater stress than it has faced in our lifetimes.”

“Today, humanity is just one misunderstanding, one miscalculation away from nuclear annihilation,” Guterres said at the Non-Proliferation Treaty (NPT) review conference in New York on August 1. He urged the world’s nations to “put humanity on a new path toward a world free of nuclear weapons.”

Risks of nuclear warfare are at their highest since the height of the Cold War, he added.

“Humanity is in danger of forgetting the lessons forged in the terrifying fires of Hiroshima and Nagasaki. Geopolitical tensions are reaching new heights. Competition is trumping cooperation and collaboration. Mistrust has replaced dialogue, and disunity has replaced disarmament.”

The NPT should be strengthened to “make it fit for the worrying world around us,” the secretary-general said, citing the Russia-Ukraine conflict and tensions in the Middle East and on the Korean peninsula. 

“Almost 13,000 nuclear weapons are now being held in arsenals around the world. All this at a time when the risks of proliferation are growing and guardrails to prevent escalation are weakening.”

Guterres said countries are seeking security by investing hundreds of billions of dollars to stockpile “doomsday weapons that have no place on our planet.” 

The US, the only country to have ever deployed a nuclear bomb in war, reportedly spent US$44.2 (RM197) billion on such weaponry in 2021, exceeding the US$38.2 billion spent by the eight other nuclear-armed nations combined. 

China ranks second in nuclear spending at US$11.7 billion, while Russia is number three at US$8.6 billion.

“The clouds that parted following the end of the Cold War are gathering once more. We have been extraordinarily lucky so far, but luck is not a strategy. Nor is it a shield from geopolitical tensions boiling over into nuclear conflict,” Guterres added.

World leaders must do something to prevent global suffering and misery. – August 7, 2022.

* Jamari Mohtar reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.