It’s Monday, March 7th, and this is your Morning Wire. Listen to the full podcast:
1) Russian Violence Escalates In Ukraine
The Topline: The Russian invasion of Ukraine continues, and reports indicate that Russian forces are ramping up their attacks, even targeting civilians.
Quote Of The Day: “…A no-fly zone, if people understood what it means, it means World War III. It means starting World War III.”
– Senator Marco Rubio (R-FL)
Last Thursday, leaders from Ukraine and Russia announced they had agreed to a temporary cease-fire to support “humanitarian corridors” to allow food and medicine to be brought in, and for civilians to get out.
But it appears that Russian forces have ignored this agreement. More territory has been taken by Russia in recent days and multiple Ukrainian cities are now surrounded. As civilians try to escape, ruthless shelling of these cities has continued, with numerous reports that civilians are being targeted.
The mayor of one surrounded city – Mariupol – said thousands of residents had gathered on Saturday to escape the city under the supposed safety corridor, but Russian shelling began regardless.
In Mariupol, the Ukrainian National Guard said Russian forces encircled the port and continued to shell the area on Sunday as Russian media blamed Ukrainian forces for supposedly failing to uphold the ceasefire.
The continued and increasing levels of violence are only fueling the scale of humanitarian disaster. In addition to those suffering on the ground, either due to lack of supplies, injuries, or death, a massive number of refugees are trying to escape under horrendous conditions. The U.N. estimates that 1.5 million have now fled, with almost 1 million refugees flooding into Poland alone.
No-Fly Zone Debate
On Sunday, Russia attacked Vinnytsia, a civilian town, destroying its airport with eight cruise missiles. The continued threat from the air is making the debate over the issue of a no-fly zone over Ukraine more central.
Ukrainian President Volodymyr Zelensky asked for a no-fly zone, which would mean NATO forces would actively prevent Russian planes from entering Ukrainian airspace – with the use of force if necessary.
Putin has said he would consider this an act of war and the concern among many is that a western-enforced no-fly zone would escalate the conflict beyond Ukraine into what could become a world war.
NATO’s Secretary General said NATO planes would not operate over Ukrainian airspace, and the United States’ U.N. ambassador reiterated President Biden’s position on American military intervention, saying, “President Biden has been very, very clear that American troops will not be put on the ground or in the air…”
2) Gas Prices Hit Record High
The Topline: This week, for the first time since 2008, the price of gasoline hit $4.00 a gallon, marking a drastic increase of 43 cents in one month.
Nationwide, the average price of gas is now slightly over $4.00 per gallon, which is the highest on record since 2008, when prices jumped to $4.11. The data show that every region is seeing a major spike. West Coast states are at $4.31, midwest states are at $3.47 a gallon, and even in the Gulf Coast, where prices are typically the lowest due to their proximity to oil reserves, prices are also at $3.31.
Remember: A gallon of gas at the end of 2020 was $2.12. The average household goes through around 90 gallons of gasoline a month, meaning people could be paying roughly $1,300 more for gas this year than last year.
President Joe Biden and his administration are positioning the rising gas prices as the cost of holding Russia accountable. Prices have gone up 47 cents since the war started 12 days ago. Even though America only relies on Russia for around 8% of oil imports, Europe and Asia are very reliant on them. Now that more countries are unwilling or unable to purchase Russian oil, the global price is soaring, which impacts the price for everyone.
However, gas prices were already going up rapidly well before the conflict due to record inflation, supply chain backups, and a shift away from domestic energy production after President Donald Trump left office. America imported more Russian oil in 2021 than at any point in over a decade.
Some commodity experts project prices to be at $4.25 a gallon by Memorial Day, while Tom Kloza from the Oil Price Information Service said he expects the price to top out around $4.50 a gallon in the coming months.
Lawmakers on both sides of the aisle say it’s outrageous to import Russian oil and essentially financially aid Putin during the war, and the Biden administration is feeling pressure to take action. Right now, however, they’re not taking any concrete steps to ban Russian oil.
Cecilia Rouse, the Chair of the Council of Economic Advisors was asked about that last week and said, “We don’t import a lot of Russian oil, but we are looking at options that we can take right now if we were to cut the U.S. consumption of Russian energy.”
3) Hollywood Withdraws From Russia
The Topline: Along with formal sanctions, American companies like McDonalds, Dell Computers, and Apple have suspended sales in the country and now, Hollywood is joining the backlash.
Last Monday, Disney said it was pulling its new Pixar animated movie – “Turning Red” – from the Russian market because of the war with Ukraine.
In a statement, the company said that “given the unprovoked invasion of Ukraine and the tragic humanitarian crisis, we are pausing the release of theatrical films in Russia.”
The next day, Warner Bros. announced it, too, is pausing releases in Russia, meaning Russian audiences aren’t going to get the new Batman movie.
After that, other major studios put out their own announcements, including Paramount, Universal, Sony.
The Motion Picture Association also put out a statement supporting Ukraine and condemning Russia.
Some are criticizing the studios for hypocrisy regarding China.
The country has notoriously committed genocide and forced sterilization of its Uyghur population, but that didn’t stop Disney from filming in the area where the most egregious human rights abuses were happening — and publicly thanking local authorities. They’ve also famously altered some content to avoid offending CCP censors.
Remember: Russia accounted for 2.8% of global ticket sales last year, but China represents 34% of the global box office.
Studio defenders, however, claim that open war is different from human rights violations.
Defenders also point out that while studios may not be applying this policy uniformly to bad actors, it’s better for them to take a stand here than stay silent.
And…With the SWIFT banking system down, it’s not clear that studios would have been able to get their box office earnings out of Russia anyway – at least not soon.
Other Stories We’re Tracking
Several news networks have stopped broadcasting from Russia. Among the networks are ABC, CBS, CNN, Bloomberg, BBC and CBC. The move comes after Russia’s parliament passed a “fake news” law threatening to arrest journalists whose reports don’t align with Russian propaganda. Journalists could face up to 15 years in prison.
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