War has returned to Europe. Vladimir Putin has begun a full-scale invasion of Ukraine, bombarding the country with artillery and missiles and attempting to take control of a critical airport. Columns of Russian tanks have rolled into the country. At the time of this writing, Russian forces are advancing toward Kyiv, the capital. Casualties are mounting. Ukrainians are fleeing their homes. Lines are long at the border crossing into Poland. This could become the largest conflict in Europe since the end of the Second World War.
Fox News host Tucker Carlson said last night that we have “no national interests” in Russia’s decision to wipe a sovereign nation off the map. This is, of course, absurd. The geopolitical, security, and humanitarian ramifications of Russia launching a land war in Europe clearly affect our nation, and they will rightfully receive most of the attention today and in the coming days.
There will be significant economic consequences as well.
Mr. Putin’s invasion is a direct threat to the post–World War II liberal international order. It is quite literally a threat to NATO, should it embolden Putin to train his sights next on Estonia. But more than that, if Mr. Putin is successful in conquering Ukraine, it signals a new chapter in the rise of authoritarianism.
The post-war order has been a bedrock of prosperity in the West for seven decades. It consists of institutions, relationships, and dispositions that allowed Europe to move past the bloody first half of the 20th century. It has kept the West safe and free — which allowed for prosperity to flourish.
What happens in Europe has a large effect on the United States. The flow of trade between the U.S. and European Union accounts for one-third of global economic output and supports 15 million jobs, according to a 2018 analysis by the U.S. Chamber of Commerce. The Chamber estimates that more than four million Americans work for European countries in the United States. The U.S. Trade Representative reports that the United States exported $268 billion in goods — aircraft, mineral fuels, machinery, medical instruments, pharmaceuticals — to the E.U. in 2019, along with $200 billion in services. The EU has $2 trillion invested in the U.S., led by manufacturing, wholesale trade, and finance and insurance.
The secretary general of NATO has called this “the most dangerous moment in European security for a generation.” In part that is true because Mr. Putin’s territorial ambitions don’t stop with Ukraine. If he gets away with this, there is every reason to believe he will continue to try to seize territory from his neighbors, further threatening lives and livelihoods. The longer Mr. Putin threatens his neighbors, the greater the damage to the prosperity of Europe and the United States.
Other malicious nations will be emboldened if Mr. Putin succeeds in wiping Ukraine off the map. The threats to global economic and security stability may not end in Europe.
There are immediate economic consequences as well. The invasion of Ukraine will push up the price of energy at a time when U.S. consumer and producer prices are already growing at troubling rates. This makes the Fed’s job — already difficult because the central bank was so late to recognize that inflation isn’t “transitory” — even more challenging. The policy rate is still near zero. Inexplicably, the Fed is still purchasing long-term assets. A surge in energy prices could require even more aggressive tightening than would otherwise have been the case, increasing the risk of the central bank accidentally tipping the economy into recession.
The prices of other commodities — certain metals, wheat — will increase as well, which could further exacerbate consumer and producer prices. Global trade will be disrupted. This will hit Europe harder than the United States, but our nation will not be unaffected. Financial-market volatility will increase. As I write, in the U.S., stocks are plunging.
Donald Trump has had words of praise for Mr. Putin in recent days. Mr. Carlson denies our national interest in a European war. Some Republican leaders have sounded similar notes.
A lesson for the political right: Flirting with authoritarianism may seem appealing as a political or media strategy when the risks of that flirtation seem low. But even low-risk outcomes sometimes materialize. Following the 2020 election, power did not transfer peacefully from one U.S. president to the next. Today, war has returned to Europe.
Liberal society — free people, individual rights, government by the consent of the governed, equality under the law, free markets, peace, and prosperity — is an accomplishment. It can be lost. Serious people do not take it for granted.