By Nate Bear, Substack, 8/28/25

I am republishing this essay with Nate Bear’s permission. Nate is very passionate in describing the Gaza genocide and what it means for the future of liberalism. To quote Nate Bear: “Gaza should, and I believe will, mark the end of liberalism.” I just ordered a book by Philip Pilkington titled: “The Collapse of Global Liberalism: And the Emergence of the Post-Liberal World Order.” I have not had time to read the book, but the idea that 500 years of “liberalism” is ending cannot be discounted. What will or should replace liberalism is the question. There are several appealing aspects of “liberalism”, including freedom of speech and association, due process, equal justice under law, and the rule of law, but these concepts are increasingly under assault as wealth and power, not majority rule, dominate what’s left of our “democracy”. Let me know what you think of Nate Bear’s essay and ideas. – Sylvia Demarest

The September deadline set by France, the UK, Australia and Canada for Israel to stop its genocide and commit to a two-state solution is fast approaching. And looming alongside this deadline is a final crisis of legitimacy for western liberalism.

Firstly, let’s just reflect on how utterly absurd these conditions are: we’ll recognise your right to your own independent state ONLY IF YOUR HOLOCAUSTERS KEEP HOLOCAUSTING YOU. They are making the creation of an entity which, legally, according to the 1948 partition agreement should have existed for the last seventy seven years anyway, contingent on more slaughter.

The pitiful centrist impulse to triangulate every issue has never been more pathetically, tragically and infuriatingly on show. The belief that you can carrot-and-stick your way to a liberal sweet-spot solution on every issue, even an actual holocaust, is such an odious reflex.

Gaza should, and I believe will, mark the end of liberalism. You can’t support an openly declared final solution, announce two years later that recognition for the victims is literally contingent on the final solution proceeding, while continuing to trade on the same old lines about human rights, equality, justice.

Gaza has shown it all up as a sham. The events of the last nearly two years have driven a stake through the dank, rotten heart of this liberal ideology.

The truth is that (neo) liberalism encases supremacist attitudes in pro-social language and symbols despite being, today, an inherently and aggressively anti-social, racist and violent ideology. I don’t particularly want to get into history, definitions and changing use here. You can argue that classical liberal thinkers like Thomas Paine or John Locke would be horrified by genocide, permanent war and the surveillance state.

But what is inarguable is that liberalism in the twentieth century, particularly the second half of the twentieth century, has been dominated by violent centre-right and centre-left liberals. These groupings and their acolytes broadly agree on free markets, freedom of suffrage (what they call democracy), some forms of social justice and equal rights, and they agree on a geopolitical story of the world. They both identify the same good guys and the same bad guys and also believe in the need to forever expand the military and surveillance state to defeat the bad guys. And both these parties, from those in western Europe to those in North America, believe that to do this, killing lots and lots of people is frequently justified.

No one with any understanding of recent history could deny this.

Over the last eighty years, liberals of the centre-right and centre-left, Democrats and Republicans, Labour and Conservative parties, have dropped nuclear bombs on Japanese cities, sanctioned the murder of one million civilians in Indonesia, and from Vietnam to Korea to Libya to Iraq have invaded, raped and pillaged.

And while Gaza is of a piece with recent liberal history, I don’t think we can see it as simply another mass murderous episode in western imperialism. Because what has emerged over the past two years is something unique.

Gaza breaks what was already an ultra violent mould.

Never in the modern era have we seen two million people be cut off from the outside world, trapped, unable to leave, starved and systematically murdered while made homeless and living in tents. Never in the modern era have we seen everything be taken from a people, every university, bakery, school, cafe, office, park, restaurant. Every standing home. We’ve not seen a state destroy so much infrastructure that it has ended the ability of an entire society to function as such. No running water, no sewage systems, no grid electricity. Almost everything in Gaza has been turned to dust and rubble. Never have we seen a starving people trapped in a tiny patch of eviscerated land and watched as their holocausters baited them with food, only to gun them down for fun. Guns supplied by our governments, with our money. Never have we seen so many doctors, nurses and journalists torn apart by jets from the sky while holding nothing but the tools of their work, their stethoscopes and cameras. Jets supplied by our governments with our money. Never have we seen people with Down’s Syndrome ripped apart by attack dogs or teenagers assassinated by drones while in wheelchairs.

No, this is heinous and new, even by western imperialism’s barbarous standards.

You have to go back to ancient Greece or the crusades and the sacking of cities to find something comparable.

The fact that the resistance continues to inflict casualties on the invaders under these conditions is a marvel of the human spirit and should be celebrated as such.

And we certainly haven’t seen violence, war crimes and unspeakable atrocities on this scale captured so frequently on camera in such fine-grained graphic detail.

On top of this, every single stage of this genocide was openly declared by Israel. Israeli politicians said there were no civilians in Gaza, that everyone was guilty, that they’d starve them, burn them and destroy everything. They said the goal was to drive them out of Gaza, to ethnically cleanse Gaza. They said it brazenly, week after week. And then they did it. And they did it with the support of liberals. Trump has overseen eight months of genocide. Biden and Harris oversaw fifteen months. The Conservative party oversaw nine months of genocide. Starmer’s Labour Party has supported Israel through thirteen months of slaughter. The liberals in Australia and Canada don’t even have the excuse that it started on someone else’s watch. They’ve backed this genocide from the start.

Then a few weeks ago, when this dishonest threat to recognise Palestine was made, Israel’s finance minister said they’d step up the holocaust in response and make sure there was nothing left to recognise. Knowing they wouldn’t be stopped, they proceeded to do just that, with zero reaction from the complicit liberal cowards in London, Ontario, Canberra and Paris.

Liberalism doesn’t have a future after this. Not an energised one, at least. Gaza signals the final crisis of legitimacy for liberalism and its supposed international order. Spiritually, it’s over. It will take time for pro-genocide liberals to face the consequences, time for their political groupings to be defeated and made irrelevant. International institutions ruled by liberals will not evaporate over night. But no one will now take their orders from liberals. No one will be lectured to about democracy, human rights, and freedom. The global multilateral institutions run by pro-genocide western liberals will find it increasingly difficult to maintain their legitimacy in the post-Gaza holocaust era. The global south has been watching, and through the expansion of BRICS and the formalisation of new agreements, is now organising. Domestically, as we saw in the US last November, liberal bases in the west will no longer come out in sufficient numbers to keep reanimating the corpse of liberal technocratic management.

The centre could never hold. Among the dead of Gaza lies the liberal project, the only deserved victim of this genocide.

We are left then with two possible futures: a radically pro-social and communitarian one, focused on justice and equity for all, or an authoritarian cesspit of racism, war, and eugenics, administered by the tools of the outsourced surveillance state. We know these are the choices, because we’ve already seen it play out. Trump’s victory was in fact the first sign that Gaza heralded these binary futures. The causes of Harris’s loss were contested by liberals, but the polls in the weeks after were clear: her support for genocide was a priority issue for enough people who otherwise would have voted for her, and Trump snuck through.

Without viable pro-social, anti-imperial alternatives, expect this pattern of pro-genocide liberals losing to proto-fascists to be repeated throughout the west.

The answer in the face of these frightening dynamics is, obviously, not to run back to the genocidal warmongering liberals who landed us here.

The answer is to help shape those radical alternatives.

The stakes couldn’t be clearer, the lines sharper than ever.

Lt. Col. (Ret.) Daniel Davis, Military.com, 8/25/25

Earlier this year, speaking at a press conference in Qatar, President Donald Trump categorically declared that “nobody can beat us.” He continued, “We have the strongest military in the world, by far. Not China, not Russia, not anybody!”

We do have a strong military, but we are woefully unprepared to fight a modern war. That’s because, despite all of the major technological advances in warfighting in recent years, manpower is still absolutely critical, and understanding how those boots on the ground interact with emerging drone warfare is still in its infancy in the U.S. military.

Ground warfare has evolved over the past three and a half years since Russia invaded Ukraine. I’ve spent considerable time studying this conflict from strategic, operational and tactical angles, and I’ve conducted multiple interviews with combatants on both the Russian and Ukrainian sides. The picture that emerges explains not only why Russia’s progress is slow and Ukraine is gradually losing ground, but also why the U.S. would face serious challenges if forced into a similar fight today.

Some have argued that Russia has failed to completely conquer Ukraine because Russian generals and soldiers are of poor quality. That conclusion ignores the genuinely game-changing nature of drones on the conduct of land warfare.

There isn’t one category or type of drone that is game-changing by itself, but rather the categories of drones and the ways they can be employed in concert with other drones and legacy platforms and soldiers. There are primarily four main classes of drones: first-person view (FPV) drones that fly explosive charges directly into vehicles or soldiers, bomber drones that fly over a target and release bombs, missile-carrying drones, and reconnaissance drones.

Despite endless talk about game-changing weapons, only the widespread deployment of drones has truly altered the nature of this war. Armored vehicles remain essential for transporting infantry to the front, but they can’t move in large numbers without suffering catastrophic losses. Traditional armored charges – such as the type I participated in during Desert Storm’s Battle of 73 Easting – are deadly in today’s battlefield conditions. Russia has increasingly turned to motorcycles to improve frontline mobility – not because they offer protection, but because their speed and maneuverability improve their chances of defeating drone attacks. No armored vehicle can dodge an FPV or fiber optic-guided drone, but a motorcycle might.

As a result, every inch of ground in modern war is contested: by various types of drones, artillery strikes, missiles, rockets, air attacks, armored vehicle cannons, and infantry attacks. Both sides in the Russia-Ukraine War have suffered high vehicle losses. Fighters from both Russia and Ukraine have told me that stepping out of a trench – for any reason, even to eat or relieve themselves – is extraordinarily dangerous.

Any movement above ground can be spotted and targeted by drones within minutes. Reconnaissance drones scan likely targets and guide attack drones to strike. Others simply loiter above the battlefield, waiting for an opportunity.

This is why manpower is still the decisive factor: Drones and air attacks can be devastating, but it takes boots on the ground to either take territory or hold it. This is where Russia’s biggest advantages have come into play in this war of attrition. Russia has millions more men of military age to draw from than Ukraine, and Moscow has chosen to limit its manpower losses and play up its firepower advantages.

Rather than launching costly frontal assaults, Russian forces now frequently flank Ukrainian positions and cities, saturating them first with artillery and glide bombs, then using drones to pin down defenders, and only then send in the infantry to seize territory.

This has sobering implications for the United States and NATO. We do not know how to fight this kind of war. Only recently has the Pentagon begun taking drone warfare seriously – something that should have happened after the 2020 Armenia-Azerbaijan conflict. Better late than never, perhaps, but the deeper problem is cultural and doctrinal. We still think in terms of maneuver warfare, “shock and awe,” and rapid dominance. Those concepts no longer apply in peer-on-peer conflicts like this one.

Russia needed nearly two years to discard its outdated views on modern war. It adapted. We haven’t. Earlier this month, the Ukrainian military even mocked the U.S. Army’s newly updated field manual for the “Tank Platoon,” saying flat-out that our doctrines are detached from current battlefield realities.

Today’s U.S. armed ofrces no doubt have skills, quality personnel, and good equipment. But we are far behind in understanding how to fight modern wars. It took both Russia and Ukraine the better part of a year and a half to fully recognize how all the classes of drones have changed the nature of war. Both sides paid an exorbitant price in blood to learn those lessons.

The U.S. Army has studied the conflict and just last month published a compendium on examining the changing nature of war. That’s useful and good. But intellectual knowledge alone won’t help you in the next fight. We’ve got to make profound and fundamental changes now to have a chance to avoid disaster when next we fight on the ground. If the Pentagon was taking this seriously, leaders wouldn’t have merely published a report. They would be urgently changing our fighting doctrine, systems of equipment, types of ordnance and the like to enable and equip our troops to successfully wage war in this new world of conflict.

Yet there is little evidence they’ve done any of those things.

History is filled with the wreckage of once-powerful armies that failed to change with the times and suffered avoidable defeats in subsequent wars. If we are to avoid that sad tradition, major changes must be made, immediately and with urgency. Otherwise, we will pay in blood later for what we should have done today.

By Tarik Cyril Amar, RT, 8/25/25

In some important ways that Western information warriors love to miss, Russia and the West are quite similar. Like the West, Russia has a typically modern state, even if today it functions much better than its Western counterparts.

Russia’s economy is capitalist like almost everywhere else on the planet now, even if the Russian state – because it functions better – has reasserted control over the rich, while the West, sick with neoliberalism, lets them dominate and damage national interests. This is one reason, incidentally, why Russia has withstood unprecedentedly savage Western economic warfare and has a far more effective military-industrial complex than the West.

Finally, while Russia spans Europe and Asia, it is also a major force within that specific cultural tradition whose origins we associate with Europe, or more broadly, the West, from novels to classical conservatories.

Yet, in other respects, there are principal differences between Russia and the West. Please forget, for a moment, about the usual suspects (Russian Orthodoxy versus the rest, for instance, or the usual speculations about space, climate, and mentality). Instead, let’s be concrete and very contemporary: Let’s ask what differences matter most to the issue of finding (or not) a valid peace for the Ukraine conflict. Then two things emerge, one obvious and the other a little less so.

What is easy to spot is that Russia is united and the West is not. In part, this is simply due to the fact that Moscow rules over one country, while Washington, the de facto capital of the West as a geopolitical entity, rules – and exploits ever more crudely – a complicated outer empire of formally independent nation-states that are de facto its clients, satellites, and vassals.

While the US exerts a great deal of brute power over its domain, in reality, the latter is as potentially fissiparous as every empire before. If you think that the mere assertion of unity and control is the same as reality, ask the Soviets about their luck with that idea. Except you can’t, because one day they were there and the next – as if by foul magic – they were not.

What is harder to notice – but never to be unseen once you do – is that the political establishments of Russia and the West now have fundamentally different patterns of learning.

In short, Russia’s is normal in that it has a learning curve, and one with a nice upward bend: That is why its opponents find it impossible to massively deceive it, as occurred in the late 1980s and much of the 1990s.

The current learning pattern of Western, especially the European elites, on the other hand, is highly unusual: it forms, in effect, a flat, closed circle. On that trajectory, things sort of move, but they never really change.

The current state of the attempts to end the Ukraine conflict via negotiation and compromise perfectly illustrates this difference. Indeed, both Russia and the West are displaying their respective learning or for the West, really, non-learning patterns in exemplary fashion.

On Russia’s side, the hard lessons of systematic Western bad faith – from no-NATO-expansion promises to Minsk II – have been fully absorbed. As a result, Moscow, even while open to talks and a solution by realistic agreement, does not make the mistake of being swayed by emotions, hopes, and momentary vibes (the “Alaska vibe,” for instance), as happened to Russia (and before that, the Soviet Union) around the time of the end of the Cold War, with extremely painful consequences.

Specifically, that means that the Russian leadership has made it clear that – after the Alaska summit as much as before – it will not make concessions on key aims. For instance, Moscow will not accept the idea of Ukraine getting NATO membership, even under another label. Likewise it will not tolerate troops from NATO countries in postwar Ukraine, and it will not give up on securing the rights of Russian speakers in Ukraine. Rather silly attempts to pressure the Kremlin into premature meetings with Ukraine’s past-expiration-date leader Vladimir Zelensky have also gone nowhere.

There are observers in the West who are immune to Western propaganda and assess Russia in a fair manner. Some of them have recently been worrying that Moscow might walk into Western traps, as happened at the end of the Cold War or in 2015 when Russia accepted the Minsk II agreement, which the West and Ukraine then abused. Yet the Russian leadership shows no sign of being in any danger of doing so this time.

The West, however, is stuck in its ways. At least as a whole, it has not yet learned a thing, it seems, from the ferocious crash of both its long-term post-Cold War strategy of expansion by cheating and its recent attempt to eliminate Russia as a great power through a proxy war using Ukraine. NATO kaput, really, but NATO isn’t noticing.

The most obvious sign that the West has not yet learned its lesson is its persistent habit of auto-diplomacy. The West is odd in that it does most of its intensely exciting negotiating with itself. While you may well think that that is because the West is – structurally – not united, that is, actually, not the real reason for this narcissistic habit.

In reality, the reason for this self-damaging refusal to face reality is something else. Namely, a deep, entirely misplaced, and pathologically unquestionable sense of superiority. It is as if the West were so powerful that it need not bother with what others have to say but only with its own soliloquy. A fantasy both absurd and highly detrimental.

Consider the so-called “Coalition of the Willing,” in essence, a loose ad-hoc grouping of mostly European (Canada does a Canada and can’t make up its mind) states that seem unable to stop planning – with whatever degree of sincerity – to somehow place their troops in postwar Ukraine, even if only with a US “backstop” no one can plausibly define.

Follow merely Western debates and mainstream media about this ongoing and confused effort and you will find it hard to even notice a rather important fact: Russia’s answer to any such scheme is a very hard no. And yet the West sticks with its geopolitical inner monologue: endlessly discussing a thing that – if its leaders ever actually listened to their Russian counterparts – they knew cannot be realized. Because insisting on realizing it means that Moscow will not settle but continue fighting – and winning.

That may, of course, be the real Western intention here: to produce a deal-breaker. But if that is so, then the next question is why the US tolerates this stalling and sabotage operation by its European vassals.

There are three possible answers to that question: Either the US is already secretly planning to override its European dependents and therefore does not care how they keep themselves busy with their fantasies. Or Washington is still as blind to reality as the Europeans. Or, finally, Trump and his team believe that they can use the Europeans’ ongoing chatter about their coalition-with-nowhere-to-go as some sort of leverage in negotiations with Moscow.

Of those three American postures, only one would be realistic and productive: the first. The other two would mean that Washington is as learning-incapable as Europe, because a US attempt to use the European talk as some kind of bluff to exert pressure on Russia would signal that Trump’s team has not come to terms with Russia’s resolve not to concede major war goals while winning on the battlefield.

Further examples could be added. For instance, Washington’s erratic statements and arms sales regarding Kiev either not being granted or needing a capability to strike deep within Russia. Or its latest attempt to once again operate with a deadline and vague warnings: this time, it’s two weeks and, so the US president has told us, within them he will decide what to do about Ukraine and America’s policy toward it. In essence, if there still is no progress toward a peace settlement, either double down again on confronting Russia, Biden-style, or abandon this terribly misguided proxy war to those Europeans who are too obstinate to finally drop it.

Trump’s recent decisions and actions seem to show that, with regard to the Ukraine war, the US is actually turning a corner and leaving that flat, closed circle of non-learning behind, in favor of becoming a country with a more normal foreign-policy learning curve, just like Russia. We can only hope that this saner attitude will prevail, even if Western Europe wants to stay behind in its impotent fantasy realm of splendid omnipotence.

Moon of Alabama, 8/25/25

The (former) President Zelenski of Ukraine is refusing any compromise in negotiations with Russia. He would be killed and replaced by a more right wing figure if he would consider otherwise.

In a speech on Sunday marking Ukraine’s independence Zelenski insisted of recapturing all of Ukraine including Crimea.

As the Washington Post summarizes (archived):

In Kyiv on Sunday, Ukraine’s Independence Day, Zelensky addressed the nation and vowed to restore its territorial integrity.

“Ukraine will never again be forced in history to endure the shame that the Russians call a ‘compromise,’” he said. “We need a just peace.”

He listed some of the regions occupied by Russia — including Donetsk, Luhansk and Crimea — and said “no temporary occupation” could change the fact that the land belongs to Ukraine.

Zelenski thus rejects calls by U.S. President Trump to give up Ukrainian territory in exchange for peace.

One reason why he does so may be the personal danger he is in. Any compromise about territory may well cost his life.

The London Times continues to make propaganda for Nazis. After a recent whitewashing interview with Azov Nazi leader Biletsky (archived) it yesterday published an interview with the former leader of the fascist Right Sector in Odessa Serhii Sterneneko.

‘Russia has repeatedly tried to kill me — I must be doing something right’ (archived)

Sterneneko had a leading role in the 2014 massacres in Maidan Square and at the Trade Union’s House in Odessa. The Times is whitewashing his participation in those events. It does not mind to publish his threats against Zelenski:

[A]mong Ukraine’s younger generation of soldiers and civilians, Sternenko’s brand of truth to power has wide popularity. “I say what I think, and people like what I say.”

His views on President Putin’s demand for Ukraine to cede the territory it defends in the eastern Donbas region as a precondition for possible peace are typically direct. “If [President] Zelensky were to give any unconquered land away, he would be a corpse — politically, and then for real,” Sternenko said. “It would be a bomb under our sovereignty. People would never accept it.”

Sternenko, who himself has avoided the draft, wants the war to go on forever:

Indeed, as he discussed Russian intransigence and President Trump’s efforts to end the war, Sternenko’s thoughts on the possibility of peace appeared to be absent of any compromise over Ukrainian soil.

“At the end there will only be one victor, Russia or Ukraine,” he said. “If the Russian empire continues to exist in this present form then it will always want to expand. Compromise is impossible. The struggle will be eternal until the moment Russia leaves Ukrainian land.”

Other British media continue to promote the rise of Nazi affiliated figures in Ukraine. The Guardian adds by promoting the presidential campaign of the former Ukrainian general and now ambassador to the UK Valeri Zaluzhny:

In private conversations, Zaluzhnyi has not confirmed he plans to go into politics, but he has allowed himself to speculate on what kind of platform he could propose if he does make the decision. Those close to him say he sees Israel as a model, despite its current bloody actions in Gaza, viewing it as a small country surrounded by enemies and fully focused on defence.

He would style himself as a tough, wartime leader who would promise “blood, sweat and tears” to the Ukrainian people in return for saving the nation, channelling Winston Churchill. In one private conversation, he said: “I don’t know if the Ukrainian people will be ready for that, ready for these tough policies.”

A day before being fired as the commander of the Ukrainian army Zaluzhny took a selfie with the leader of the fascist Right Sector and commander of Right Sector brigade of Ukrainian military in front of a portrait of Nazi collaborator Stepan Bandera and the fascist OUN flag.

The picture was already part of his campaign to become the leader of a Bandera-ized Ukraine.

It seems that the British deep-state does its best to support him in that.

This article is from June but it explains some of the legal debate and political implications surrounding whether to seize Russia’s frozen assets to use for Ukraine. – Natylie

International Crisis Group, 6/17/25

What is happening?

Following Russia’s full-scale invasion of Ukraine, countries that decided to impose sanctions on Moscow also froze Russian assets held in their banks or other financial institutions. On 28 February 2022, just days after the invasion, the European Union, the U.S., Canada, Britain and Japan blocked the transfer or use of bonds, deposits and cash owned by the Russian Central Bank and denominated in the currencies of the sanctioning countries. Switzerland and Australia did the same soon thereafter. Western supporters of Ukraine have also frozen privately owned Russian assets totalling more than €70 billion ($79.9 billion).

Estimates of the value of Russia’s frozen sovereign, or state, assets vary. In September 2023, officials from sanctioning countries assessed the total at around $280 billion (€262 billion), with approximately €210 billion ($224 billion) held in EU member states. Russian estimates are slightly higher. 

Either way, by some distance the largest share, €183 billion ($192 billion), sits with the Belgium-based central securities depository, Euroclear, a financial services company that acts as an intermediary between buyers and sellers of securities, such as stocks and bonds, and which has total assets under management of €40 trillion. Japan has the next largest share, with $33 billion (€30 billion), mostly held in cash in Japanese banks. France has frozen approximately €19 billion ($21 billion), Switzerland 7.7 billion francs ($8.8 billion, or €7.9 million), the U.S. $5 billion (€4.6 billion) and Germany €210 million ($229 million). Some countries do not report separately on the sovereign assets or privately held assets that they hold, instead providing a combined total. These include the UK (£25 billion, or $34 billion), Canada ($316 million, or €288 million) and Australia ($64.5 million, or €56 million). 

The range and size of these holdings reflect that Russia has an export-oriented economy; it has long deposited assets in other countries and in multiple currencies as a standard practice and risk-hedging strategy. Because dollars and euros were the primary currencies for Russian foreign trade before February 2022, Russia’s Central Bank held dollar and euro-denominated accounts abroad to make dealings easier. Dollars and euros were also important for payments inside Russia, where firms and individuals used them for numerous transactions. As of 1 February 2022, Russian households had $257.9 billion (€230 billion) in foreign currency savings.

As war drags on in Ukraine, a range of experts and officials in Europe, the U.S. and Canada, as well as the government in Kyiv, have argued that Russia’s frozen assets should be seized and used to support Ukraine. These funds could cover the Ukrainian government’s current public and military spending, now being paid for in large part by U.S. and European backers, as well as underwrite the gargantuan rebuilding effort that will eventually come. Kyiv argues that confiscation of Russian assets would be justified, productive and practicable. It would punish Russia for launching the war, compensate Ukraine for the huge material damage caused by Russian aggression and ensure that the Ukrainian state can balance its books, thereby serving the cause of justice in the face of an illegal invasion. Critics of the proposed measure, however, say it would violate international and national laws, might unsettle European sovereign bond markets and would weaken the euro’s status as a reserve currency.

Why have calls to confiscate Russian frozen assets intensified?

Reconstruction of Ukraine after the war is likely to come with a massive price tag. Russia’s initial attack, the fighting that followed and the continued occupation have inflicted enormous damage on Ukrainian infrastructure and destroyed dozens of small and medium-sized settlements in the country’s east. As of December 2024, the Ukrainian government, the World Bank Group, the European Commission and the UN estimated the cost of rebuilding Ukraine at $524 billion (€506 billion), 2.8 times higher than Ukraine’s gross domestic product. The previous month, Ukrainian President Volodymyr Zelenskyy had projected an even higher figure of $800 billion (€741 billion).

Meanwhile, Ukraine faces ever greater difficulties in covering its rising day-to-day spending. Ukraine’s 2025 defence budget alone is $10 billion larger than it was in 2024. Recent shifts in U.S. policy have only exacerbated concerns about how Ukraine can balance its books. Since the Trump administration took office, the U.S. Congress has not approved any new financial or military aid for Ukraine, and it looks unlikely to do so any time soon. Its inaction poses a major challenge for Ukrainian finances, since the U.S. has provided $53.8 billion (€47 billion) in direct budget support to Kyiv over the war’s three years. Responsibility for supplying Ukraine with arms and funding its budget may now fall entirely upon Kyiv’s European backers, which are hamstrung by their own budgetary constraints.

Mindful of the economic pressures they are under, Ukraine’s leaders have repeatedly pressed the issue of confiscating Russian assets.

Mindful of the economic pressures they are under, Ukraine’s leaders have repeatedly pressed the issue of confiscating Russian assets. In May 2022, Zelenskyy proposed that an international treaty allow for seizing Russian assets and transferring them to a special fund to compensate Ukraine for damages. Ukrainians involved in negotiations with Moscow have also proposed that frozen Russian assets could serve as reparations, though Moscow has not been amenable to this idea. In February 2024, Zelenskyy said he aimed to see Russian assets held in EU member states confiscated within the year. When that did not happen, he proposed in December 2024 that $30 billion (€28 billion) from Russia’s frozen funds be used to buy ten to twelve Patriot air defence systems for his country. Asset transfer also came up in U.S.-Ukraine talks in early 2025, with Zelenskyy advocating confiscation as a way to guarantee his nation’s defence spending over the long term. 

Several EU countries, including the Baltic states, Sweden, Poland and the Czech Republic, have backed Ukraine’s push to use frozen Russian assets. With Washington making clear that its support for Ukraine will soon dwindle, if not disappear entirely, the clamour for rapid confiscation has intensified. One fear voiced among officials in EU capitals and London is that if the money is not cleared for use soon, it may be lost. The EU must renew its decision to freeze Russian assets by 31 July. If a member state like Hungary, which has pushed back against EU policy toward Moscow, vetoes the renewal, Russia could have access to the funds once again. To prevent that from happening, the UK has floated the idea of transferring all Russian sovereign assets to a special purpose vehicle authorised to make riskier investments for higher returns. Consolidating the assets in this fashion could also be seen as a step toward seizing them, as it would simplify any eventual takeover of the funds. 

What does the law say regarding confiscation of Russian sovereign assets?

Whether international or domestic laws allow Russian Central Bank assets to be confiscated by states other than Ukraine, and which are not direct victims of aggression, is a matter of dispute among officials and legal experts in the West. While the idea is supported by many politicians in the U.S., Canada and Europe, most specialists in international law argue that confiscation of Russian state assets would be unlawful expropriation. Some prominent legal scholars, such as Harold Koh, have nonetheless staked out an opposing view, insisting that expropriation would be lawful as a response to Russian aggression and if Russia failed to pay war reparations. 

Under international law, the doctrine of countermeasures maintains that the injured state, may respond to a violation of international law by seeking to induce the offending state to comply with the law. Countermeasures must be proportionate, temporary and, as far as possible, reversible. They must also meet certain procedural requirements, including proper notice to the state that has violated laws. But those are not the only legal hurdles that the case for confiscation must clear. Because assets of the Russian Central Bank are held not by Ukraine, but in third countries, the legal argument for seizure leans on the contested concept of “collective countermeasures”. If third-party states wish to apply collective countermeasures, they would likely have to depend for legitimacy upon the intervention of an international court, such as the International Court of Justice or European Court of Human Rights, which would first have to demand that Russia pay reparations and then permit its assets to be seized if it refused to do so. To date, there has been no international court decision that is binding for Russia and requires it to pay reparations to Ukraine. In theory, the UN Security Council could also impose measures like these, though as a permanent member Russia could simply veto any such proposal.

Confiscation of private or public foreign assets may … be unlawful under the domestic laws of some states.

Confiscation of private or public foreign assets may also be unlawful under the domestic laws of some states. In such cases, confiscation, as opposed to simply freezing Russian state assets, might require that states pass new legislation or amend existing laws to allow a greater margin for asset seizure (though this step would not remove the international legal hurdles mentioned above).

Some countries have already gone down that path. Canada and the U.S. have changed their laws, taking steps to legalise confiscation of Russian Central Bank assets held abroad. In June 2022, the Canadian Parliament amended the Special Economic Measures Act, which grants the executive branch broad powers to confiscate assets owned by governments or individuals, although the Senate has not yet passed the legislation allowing Ottawa to seize Russian state assets. The U.S., on the other hand, has given itself authorisation to seize Russian assets directly. In April 2024, the U.S. Congress passed the Rebuilding Prosperity and Opportunity for Ukrainians Act (REPO). This act grants the president permission to “seize, confiscate, transfer or vest” Russian sovereign assets under U.S. jurisdiction, subject to certain conditions. So far, however, the U.S. government has taken no action under the new legislation.

In Europe, views on beefing up powers of expropriation are mixed, and there is no consensus among states. Leaders in the UK, Poland, the Nordic countries and the Baltic states have tasked legal officials with looking into the options. But the largest holders of Russian assets in the EU – Belgium, France, Luxembourg and Germany – continue to oppose seizure, as do several other states in the eurozone such as Italy and Spain. Belgian Prime Minister Bart De Wever warned that confiscating Russian sovereign funds would amount to an act of war, while French President Emmanuel Macron has held that international law clearly prohibits seizure of these assets. Others in France disagree. In March, the French parliament passed a non-binding resolution urging the EU to appropriate frozen Russian assets and use them to support Ukraine.

Beyond the West, on the other hand, official support for asset confiscation is scarce. Japan, the second-largest holder of Russian assets after Europe, has stressed that these assets must be treated according to international law. China, Indonesia and Saudi Arabia have also let the EU know that they oppose confiscation, while at a 2024 Swiss peace summit, Kenyan President William Ruto condemned “the unilateral appropriation of Russian assets” as “unlawful, unacceptable and a violation of the UN Charter”. 

What are the practical challenges to confiscating the assets?

Legal concerns aside, critics argue that seizing sovereign assets would threaten the fundaments of financial stability by making foreign investors nervous about the security of their holdings. Belgium and France, which hold a 13 per cent stake and 11 per cent stake in Euroclear, respectively, are determined to remain attractive, trustworthy destinations for foreign capital, especially in the face of growing competition from Asia and the Gulf. If spooked, holders of European sovereign debt such as China and Saudi Arabia could conceivably sell off their bonds, driving up borrowing costs for already indebted European governments. In early 2024, Saudi Arabia reportedly suggested that it might offload some European debt if the G7 decided to confiscate Russian sovereign assets.

The European Central Bank has also cautioned against confiscation on the grounds of the harm it might do to the euro’s status as a global reserve currency. A general loss of faith in European markets could also have knock-on effects for the region’s security, increasing borrowing costs for governments in the eurozone just when they are seeking to raise defence spending. A European member state official told Crisis Group that risks to euro stability are the main argument militating against asset confiscation.

Are there other ways to use the frozen assets to help Ukraine?

While debate rages over whether or not Russia’s frozen assets could be seized to help Ukraine, EU officials have determined that nothing prevents them from redirecting so-called windfall profits to Ukraine.

Russia’s frozen sovereign assets originally included short-term U.S., European, Canadian and Asian government bonds, government-guaranteed securities, and cash held on account and in fixed-term deposits. In time, most of the bonds matured and, with coupon payments, were converted into cash, which remained blocked. The fixed-term deposits also expired. But the returns from interest payments on cash held on account and matured bonds, known as windfall profits, were reinvested under the holding financial institutions’ rules and remained out of the Russian Central Bank’s reach.

In accordance with its conservative guidelines, Euroclear invested the windfall profits with the Belgian Central Bank, which offers the lowest risk-free rate of return available. Euroclear reported earnings of €4.4 billion on frozen Russian holdings in 2023 and €6.9 billion in 2024. These were also taxed by Belgium, whose state coffers received over a billion euros each year as a result. The Belgian government uses those taxes to provide military aid to Ukraine.

Legal experts and financial specialists have differing opinions as to the use of these profits. Some believe that these earnings stem from asset management and do not constitute sovereign holdings, meaning that seizing the funds does not violate property rights – so long as the frozen capital itself remains untouched. Others believe that generating interest is an inherent part of capital management and that transferring these profits (eg, to Ukraine) constitutes a violation of property rights. Constant extraction of profits prevents the growth of these assets, this argument goes, and as a result of inflation, reduces the real value of capital over time.

With the first argument in mind, the European Council, which brings together the governments of all EU member states, ruled in February 2o24 that institutions holding Russian sovereign assets worth more than one million euros should manage the profits from those funds separately from the assets themselves. 

Months later, the European Council ruled that these same institutions are now obliged to transfer at least 99.7 per cent of annual net (post-tax) profits from frozen Russian state assets to the EU biannually. As the largest holder of Russian assets, Euroclear was immediately affected. The EU is now supposed to direct 90 per cent of these funds into its European Peace Facility, which finances military aid to Ukraine; the remaining 10 per cent is to help pay for other Ukraine-related programs through the EU budget. In July 2024, the EU made its first transfer of €1.5 billion of these funds to support the military effort and reconstruction in Ukraine. In April 2025, the EU received another €2.1 billion, which will be gradually channelled to Ukraine. By the end of 2027, the EU expects, his scheme will have generated €15-20 billion.

Future revenue streams from the interest on Russian assets at Euroclear and other institutions have … been deployed to secure a major loan package for Ukraine from the G7.

Future revenue streams from the interest on Russian assets at Euroclear and other institutions have also been deployed to secure a major loan package for Ukraine from the G7, which approved a $50 billion credit line on June 2024. This mechanism is called the Extraordinary Revenue Acceleration initiative. Under the plan, the U.S. is due to lend $20 billion to Ukraine and the EU a similar amount, while the UK, Japan and Canada provide the remaining $10 billion. Funds started to be disbursed in late 2024, when the Biden administration transferred its $20 billion to Ukraine. The EU has sent €6 billion since the start of 2025. As a result, windfall profits from sovereign assets will repay these lenders rather than fund Ukraine directly. Building on the success of this approach, some experts have suggested pooling all Russian sovereign assets into a single fund and issuing long-term bonds on the basis of the total amount, with the proceeds then funnelled toward Ukraine.

These funding schemes are inventive. But they also create their own obstacles to any plan either to seize Russia’s frozen assets or to thaw them. Because the G7 stipulates that its loan will take a long time to mature, extending up to 45 years in the EU and over 30 years in other countries, it means the assets will have to stay put and generate profit over that entire period, absent another plan to repay the loan. Indeed, countries like France have opposed any new decision on sovereign assets, arguing that the G7 loan create major obstacles to consolidating, seizing or unfreezing these assets in the near future. 

How has Russia responded to the freezing of its assets?

Reacting to the block on Russia’s sovereign assets, Moscow undertook its own asset freeze in March 2022. The Kremlin and Russia’s Central Bank established restrictions on individuals and bodies from “unfriendly” countries holding assets in Russian financial institutions, prohibiting them from withdrawing the money from Russia without government permission. A total of 47 countries are counted as “unfriendly”, including the U.S., Canada, the UK, Japan, Australia and all the EU member states that have imposed sanctions on Russia. Russian companies are also required to transfer funds from any dealings with businesses in those countries into special accounts that can be converted into foreign currency and taken out of Russia only with permission from the state. Russian officials declared that these restrictions would remain in effect until sanctions are lifted and the Central Bank’s foreign assets are unfrozen.

Officials have not revealed the value of foreign assets blocked in Russia. Some, including Finance Minister Anton Siluanov, have claimed that Russia has blocked foreign assets roughly equivalent in value to Russian assets frozen abroad. But some Russian experts dismiss these estimates, arguing that the total is far lower. One indicator of the size of foreign economic interests in Russia comes from a study by the Kyiv School of Economics and B4Ukraine, which estimated that, in 2023 alone, 1,600 multinational corporations generated more than $196.9 billion in revenue and $16.8 billion in profit in Russia through their subsidiaries. Companies from EU member states produced $81.4 billion of this revenue and U.S. companies $30.5 billion. Austrian Raiffeisen Bank, the largest Western bank still operating in Russia, has amassed €4.4 billion in blocked profit. Finally, it appears that investors from “unfriendly” countries continue to hold more than half of all stock traded in Russia. Norway’s sovereign wealth fund may hold assets in Russia worth $448 million.

How might Russia respond to the confiscation of its sovereign assets?

Russia considers Western sanctions to be illegal, and it says it will never renounce its rights to frozen assets. Moscow has also warned that any confiscation of sovereign assets would be met by retaliatory seizures of Western assets in Russia – and maybe by legal action as well.

The Kremlin’s first move has been to threaten to respond to confiscation of its sovereign assets by seizing private holdings inside Russia belonging to individuals and firms. A precedent already exists. In response to the U.S. REPO Act, Putin signed a decree in May 2024 allowing the Russian Central Bank to respond to any U.S. seizure of its assets by imposing the forfeiture of U.S. private and state assets in Russia. These assets can include property, shares in companies, securities and any property belonging to U.S. residents. Russia has also reportedly seized €3 billion in cash held by Euroclear and blocked in Russian financial institutions.

Secondly, Russian officials have suggested they might challenge the confiscation of Russia’s sovereign assets in court. Private investors from Russia have already filed more than 170 lawsuits against Euroclear in Russian courts. Some experts have suggested that the Russian state could take Euroclear to court in other jurisdictions, too, such as in Asian countries. The Russian state is likely to sue not in an effort to regain control of its holdings, which it believes would be futile, but to prevent their transfer to Ukraine. The lawsuits might succeed, and they might not, but they could prevent confiscation while they continue, perhaps for years.

As for using windfall profits from sovereign assets to help Ukraine, Moscow’s threats to prevent it largely ring hollow. Russia has threatened to impose sanctions and block the property of individuals or funds that purchase bonds issued against the collateral of Russian assets, but it has taken no concrete action.

How does Moscow see the role of sovereign assets in negotiations to end the Ukraine war?

Moscow sees the unblocking of Russian sovereign assets and lifting of sanctions on its Central Bank as critical to the peace deal it seeks – one that covers more than Ukraine, cementing Russia’s status as a powerful, prestigious state with major influence throughout the post-Soviet space and around the globe. The Kremlin believes that countries backing Ukraine should be willing to make the tradeoff, returning economic and political relations with Russia back to 2014 levels (including unblocking its assets) in exchange for peace in Ukraine. It views the assets it has blocked within Russia as additional leverage, saying it will not move first to loosen its grip on them.

The Kremlin’s approach has taken shape in its engagement with the Trump administration and Ukraine. While Washington has probed for a deal and better relations with Russia, Moscow has called on it to show good-will by restoring economic ties. To take one example, in March Russian negotiators offered U.S. negotiators safe navigation in the Black Sea in exchange for reconnecting Rosselkhozbank and other financial institutions involved in the international food and fertiliser trade to the SWIFT international bank transfer network. The offer was disingenuous: Ukraine had largely forced the Russian navy out of the Black Sea, meaning that Russian guarantees of safe navigation were not a major concession. Moscow also demanded something the U.S. cannot deliver. Washington does not control SWIFT, which is a cooperative company under Belgian law and complies with EU sanctions against Russia. But the gambit did reveal that Moscow is prepared to link moves toward peace in Ukraine – on the terms it defines – with Western economic concessions. The Russian position laid out two months later in talks with Ukraine in Istanbul did the same. Russia demanded that Ukraine waive all claims to compensation for war damages, a move that would deprive Kyiv and its European partners of a critical legal argument in favour of confiscating assets.

Moscow … seems willing to end Russian sanctions on the U.S. and European states, and to unfreeze assets held in Russia, if it gets what it wants.

Sensing an opportunity, the Trump administration has offered trade with the U.S. as a sweetener for Moscow. Russian authorities, however, see the resumption of trade with Ukraine’s European backers as far more important. Even though Russia has developed new trade logistics since 2022, the Kremlin is keen to resume using European trading networks and to see restrictions on transactions through European banks removed, in order to cut costs. As a result, the Kremlin appears to want to make renewal of commercial ties with the U.S. conditional on easing or lifting not just U.S. sanctions on Russia, but also European restrictions. Moscow also seems willing to end Russian sanctions on the U.S. and European states, and to unfreeze assets held in Russia, if it gets what it wants. 

The importance of European trade and financial ties in Russian calculations means that the region will almost certainly have to play a role in future peace talks. U.S. Secretary of State Marco Rubio noted as much in March, adding that Russia would request the lifting of European sanctions, including unfreezing its assets, in any negotiations.

How can the countries backing Ukraine use sovereign assets as leverage in talks with Russia?

For now, European countries are not considering using frozen Russian sovereign assets as leverage in peace talks, as they do not believe meaningful negotiations with the Kremlin are possible. They also doubt that such negotiations could result in fair compensation for Ukraine. Instead, they prefer to retain these assets and use the proceeds to support Ukraine. But if trust were to be built among all sides and negotiations to start, the fact that Moscow wants its sovereign assets back means they can be useful leverage for countries holding them. The prospect of unfreezing assets could be tabled in negotiations even as debates about confiscation of assets continue – though it should be said if the assets are confiscated, their value as leverage will disappear.

Countries backing Ukraine should consider various ways to use the issue of frozen assets in potential peace talks. One would be to make clear that they will release the money only once there is a comprehensive agreement between Russia and Ukraine. As part of this deal, Russia would also have to agree to repay the outstanding balance of the G7 loan to Ukraine. If Russia then reneges on this commitment, any assets still held (which would presumably be of much lesser value) could once again be frozen. To prevent Russia from quickly withdrawing all its assets and encourage it to adhere to the agreement, countries supporting Ukraine could consider phasing the unfreezing of assets, linking it to implementation of the terms of a peace deal. Alternatively, assets could be thawed gradually as peace (or a ceasefire) continues to hold over the course of years. Meanwhile, as long as some assets remain frozen, the countries holding them can continue to use the profits to support Ukraine.

If a comprehensive peace deal is too hard to achieve, a more incremental approach could be adopted, with parts of the assets unblocked in step with specific concessions from Russia. For example, some portion of the assets could be unfrozen in exchange for Russian agreement to allow deployment of a foreign stabilisation force in Ukraine, or a UN mission with a strong mandate, and/or to let a strong Ukrainian military maintain close cooperation with its trans-Atlantic backers. Some assets might also be released if Russia pays financial compensation for damage inflicted on Ukraine, perhaps through direct payment of an agreed-upon amount to a special compensation fund. Another possibility is that Russia and Ukraine could negotiate contracts for long-term supply of Russian oil and gas to Ukraine at no cost.

Lastly, sanctions could be lifted in exchange for Moscow’s acceptance that its sovereign assets would be partially or fully transferred to a special fund dedicated to Ukraine’s reconstruction. Moscow has reportedly indicated that it might consider this measure as part of a broader deal, so long as it would mean avoiding future damage claims and lawsuits. But the reported Russian proposal would see at least some of the funds used to rebuild on Russian-occupied Ukrainian territory, potentially suggesting acceptance by Kyiv, if not formal recognition, of Russian control of that land. While this condition might not be acceptable to Ukraine or its backers, the proposal does open the possibility of gaining Russian acquiescence to use the frozen assets for Ukraine’s reconstruction. 

In any event, it is impossible to negotiate the future of assets or sanctions relief more broadly without the direct engagement of the countries involved. Since the lion’s share of these funds are parked in European countries, the U.S. cannot make a peace deal on its own that would satisfy Russia. Working with the Europeans may not please everyone in the Trump administration, but if the goal is peace in Ukraine, then the financial reality indicates that there is no alternative.

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Kallas: EU can’t give back frozen assets to Russia, unless they pay reparations to Ukraine

Euronews, 8/30/25

The EU’s foreign policy chief said the bloc needs to dive deep into the issue of frozen Russian assets, to be prepared in case of an eventual ceasefire or peace deal.

The EU’s foreign affairs chief, Kaja Kallas, stated that frozen assets will not be returned to Russia unless Moscow pays reparations to Ukraine. Kallas argued at the informal meeting of foreign affairs ministers in Copenhagen that the bloc needs to be prepared in case of an eventual ceasefire or a peace deal.

“We can’t possibly imagine that, if there is ceasefire or a peace deal, that these assets are given back to Russia if they haven’t paid for the reparations,” the high representative said.

The EU’s foreign ministers meet in Copenhagen for an informal Foreign Affairs Council to discuss issues related to the war in Ukraine. In this format, ministers do not make decisions, but they discuss the issues in depth.

After the full-scale invasion of Ukraine, the European Union decided to freeze state assets worth 210 billion euros. This amount is not confiscated, but the EU uses its interest to support Ukraine’s war efforts.

Earlier, experts warned that the possible confiscation and use of frozen assets is an unprecedented area and could result in a legal minefield for the EU.

The biggest chunk of assets, €183bn, is held in Belgium, a host country of the Euroclear clearinghouse for financial transactions. Those assets belong to the Russian central bank, which originally held them as short-term government bonds.

In the EU, Poland and the Baltic countries were in favour of the full confiscation of the frozen assets, while Belgium, Germany, and France had legal reservations.

Earlier this week, Hungary sued the Council of the EU over a decision to grant billions of euros of aid to Ukraine from frozen Russian assets.

Budapest argued that the European Peace Facility (EPF), a financial programme which facilitates military aid to allied countries, breached EU law by ignoring Hungary’s opposition in this matter.

Ukraine receives between €3–5 billion every year through the EPF programme, which is almost fully financed from the interest of frozen Russian assets in Europe.