'Conquest doesn’t pay': Economist Paul Krugman explains why imperialism will scar Russia’s economy

The economic sanctions that Russia is facing from the Biden Administration and its European NATO allies are taking their toll: the value of the ruble, according to Washington Post, has plummeted to less than 1 U.S. cent. And more sanctions are likely on the way as Russian troops, on orders from President Vladimir Putin, continue their invasion of Ukraine.

But even without these sanctions, Putin’s decision to invade Ukraine would have a negative impact on the Russian economy. Liberal economist and New York Times opinion writer Paul Krugman, in his March 1 column, lays out some reasons why “conquest” is an economic drain for Russia and other countries.

“Despite the incredible heroism of Ukraine’s people,” Krugman writes, “it’s still more likely than not that the Russian flag will eventually be planted amid the rubble of Kyiv and Kharkiv. But even if that happens, the Russian Federation will be left weaker and poorer than it was before the invasion. Conquest doesn’t pay.”

Krugman goes on to explain that although imperialism could be profitable in the past, that isn’t the case these days.

“If you go back in history,” Krugman notes, “there are plenty of examples of powers that enriched themselves through military prowess. The Romans surely profited from the conquest of the Hellenistic world, as did Spain from the conquest of the Aztecs and the Incas. But the modern world is different — where by ‘modern,’ I mean at least the past century and a half.”

Krugman cites the “global economy” as one of the main reasons why “conquest” drains a country economically in modern times.

“In such a global economy,” Krugman writes, “it’s hard to conquer another country without cutting that country — and yourself — off from the international division of labor, not to mention the international financial system, at great cost. We can see that dynamic happening to Russia as we speak.”

Krugman goes on to offer some more reasons why, from an economic standpoint, “conquest is futile” in modern times.

“The first is that modern war uses an incredible amount of resources,” Krugman notes. “Pre-modern armies used limited amounts of ammunition and could, to some extent, live off the land.… But modern armies require huge amounts of ammunition, replacement parts and, above all, fuel for their vehicles. Indeed, the latest assessment from Britain’s Ministry of Defense says that the Russian advance on Kyiv has temporarily stalled ‘probably as a result of continuing logistical difficulties.’ What this means for would-be conquerors is that conquest, even if successful, is extremely expensive, making it even less likely that it can ever pay.”

Krugman continues, “Second, we now live in a world of passionate nationalism. Ancient and medieval peasants probably didn’t care who was exploiting them; modern workers do. Putin’s attempt to seize Ukraine appears to be predicated not just on his belief that there is no such thing as a Ukrainian nation, but also, on the assumption that the Ukrainians themselves can be persuaded to consider themselves Russians.… Even if Kyiv and other major cities fall, Russia will find itself spending years trying to hold down a hostile population. So, conquest is a losing proposition.”