The reasons and risks behind Russia's big oil bet - We Are The Mighty
MIGHTY MONEY

The reasons and risks behind Russia’s big oil bet

For years now, Russia has been laser-focused on insulating itself from an external economic shock.


It may have just sparked one.

In an unexpected move on March 6, Russia rejected a call by OPEC countries to further cut oil production in order to help prop up prices amid sagging global demand for energy due to the coronavirus.

The decision broke three years of cooperation under an arrangement called OPEC+ and stunned participants at a meeting in Vienna, not to mention some of Russia’s own oil executives — one suggested the move was “irrational” — and governments from the Middle East to the West.

OPEC leader Saudi Arabia swiftly responded to the snub by announcing it is no longer obliged to hold back production, causing the largest single-day drop in the price of oil in nearly three decades and sending global stock markets and the ruble tumbling. Why?

One potential answer: President Vladimir Putin wanted to punish the United States by putting severe pressure on the U.S. shale-oil industry, which has sold millions of barrels of oil while Russian companies kept production down under the existing OPEC+ agreement.

“The Kremlin had decided that propping up prices as the coronavirus ravaged energy demand would be a gift to the U.S. shale industry,” Bloomberg News reported. The acerbic spokesman for Russian state oil giant Rosneft, Mikhail Leontyev, suggested that was at least one of the motives, telling the agency: “Let’s see how American shale exploration feels under these conditions.”

Rosneft CEO Igor Sechin, an old and close Putin ally, has long been said to be chafing under the existing OPEC+ production limits, and was widely seen as playing a role in the decision to reject further cuts.

Some analysts played down the idea that the Kremlin was out to get U.S. shale, however, saying that Russia’s coordination with OPEC+ was fragile to begin with and that Moscow and Riyadh had different views of the current volatility on the global oil market.

Whatever the reasons, it’s a risky move for Moscow at an uncertain time.

The oil price collapse stoked by Moscow’s move and concerns about the effects of the coronavirus on a slew of industrieswill hurt Russia’s economy in the short-term, and there is no guarantee that it can knock out U.S. shale in the long run, analysts said.

The reasons and risks behind Russia’s big oil bet

U.S. Benefits

The United States has been a beneficiary of the high prices maintained by the OPEC+ output cuts over the past few years, overtaking Saudi Arabia and Russia — now Number 3 — as the world’s largest oil producer.

As the coronavirus ravaged the Chinese economy and hit others around the world, slashing oil demand, Saudi Arabia lobbied for OPEC+ to cut another 1.5 million barrels at the March 6 meeting in Vienna. Russia recommended maintaining the existing cuts. OPEC+ — a 24-member group consisting of OPEC nations plus non-cartel members like Russia — first agreed to oil production cuts in 2017.

Saudi Arabia’s announcement that it would hike production sent the price of U.S. crude oil tumbling by 25 percent on March 9 to a low of a barrel. Prices gained back some of the losses on March 10 but were well under for U.S. and the global benchmark, Brent Crude.

Some U.S. shale producers have a break-even price of a barrel or above, putting them in a vulnerable position, said Chris Weafer, an energy specialist and founder of Moscow-based consultancy firm Macro-Advisory.

Oil producers in Saudi Arabia and Russia have lower production costs, enabling them to weather the price.

“There are three parties facing off against each other — Russia, Saudi, and U.S. shale — and it really is a case of who blinks first,” Weafer told RFE/RL.

Several analysts said that in the short-term, Russia is in the strongest position among those three players.

“The impact of this price crash on U.S. shale companies is going to be pretty devastating” in the short term and could result in a U.S. production decline in 2020, said Gregory Brew, a historian at Southern Methodist University in Texas focusing on energy politics and the Middle East.

Diamondback Energy, a Texas-based shale producer, announced March 9 it would immediately reduce investment following the price drop.

Russian oil companies have some insulation. They are profitable at a oil price, helped by a free-floating currency, and the budget is protected for years to come.

The Kremlin’s conservative fiscal policy over the past few years boosted foreign currency reserves to about 0 billion and driven down the price of a barrel of oil necessary to balance the budget from above 0 to below .

At the current ruble rate of nearly 75 to the dollar, the budget can balance at per barrel, said Elina Ribakova, deputy chief economist at the Institute of International Finance in Washington.

Saudi Arabia’s budget break-even oil price is closer to and its foreign currency reserves have been declining amid a massive state spending program.

Risky Bet

Riyadh not only faces budget pressure, but potentially investor pressure to cut production to keep the market stable, Sarah Ladislaw, a senior vice president at the Washington-based Center for Strategic and International Studies, said in a March 9 note.

Riyadh recently sold shares in state oil company Saudi Aramco, raising .6 billion in the world’s largest initial public offering. The shares are now below the price the investors paid for them.

But the U.S. shale industry has shown resilience in the past and is likely to do so again, analysts said. Low oil prices lead to consolidation, which should make companies more competitive in the longer term, Brew said — the opposite of what Moscow may be angling for.

Saudi Arabia failed to achieve the goal of shuttering the U.S. shale industry several years ago: The producers improved their efficiency in response to price pressure, driving down their own production costs.

Unlike large onshore or offshore oil fields that can take years to develop, shale fields can start producing in weeks, said Rauf Mammadov, an energy analyst at the Middle East Institute in Washington. And the biggest U.S. oil companies, which are less vulnerable than smaller outfits, are investing more into shale.

“It will not impact the shale industry in the long run,” Mammadov told RFE/RL.

Meanwhile, the impact of the oil price drop is being felt globally, including in Moscow.

The reasons and risks behind Russia’s big oil bet

‘Very Unexpected, Irrational’

Russia’s already slow-growing economy could potentially contract this year if oil prices stay low for the rest of the year, said Ribakova. She previously forecast growth of more than 2 percent in 2020.

Russia is losing 0 million to 0 million a day at an oil price of rather than , said Leonid Fedun, the billionaire vice president for strategic development at Lukoil, Russia’s second-largest oil producer, which is not state-owned.

Fedun called the collapse of the Russia and OPEC+ agreement “very unexpected, irrational.”

That’s not the view at Rosneft, though. Sechin was the driver behind the Kremlin’s decision not to agree to additional cuts, Weafer said.

In June, Sechin accused the United States of using sanctions against energy-producing nations to make room for U.S. domestic production.

The United States has angered the Kremlin by imposing sanctions on Russian Baltic Sea export gas pipeline Nord Stream 2, delaying its completion indefinitely, and by slapping penalties last month sanctioned a trading arm of Rosneft for doing business in Venezuela.

In 2019, the United States supplied oil to Russia’s western neighbor Ukraine for the first time — as Kyiv seeks to reduce reliance on Moscow amid a continuing war with Russia-backed separatists in its east — while Belarus has inquired about purchasing U.S. oil as it seeks alternatives to Russian crude.

Rosneft will increase production by 300,000 barrels a day following the exit from the agreement with OPEC+, Bloomberg reported, citing unidentified company officials.

Mammadov questioned the notion that Russia is targeting the U.S. shale industry.

The abundance of global supply, while largely driven by the United States, is also due to greater output from Canada, Brazil, and other non-OPEC countries, some of which have high-cost production and will be impacted, he said.

“This is more the outcome of the failure of the negotiation rather than a premeditated strategy or tactic” to crush U.S. production, Mammadov said. “There are too many global unknowns at the moment and that is the reason why Saudi Arabia and Russia could not agree on cuts.”

If the spread of the coronavirus retreats globally, leading to a pickup in economic activity and oil demand, the tensions between Russia and Saudi Arabia will ease as the question of greater cuts subsides, Mammadov said.

Another factor potentially limiting the depth of the price war is the Kremlin’s determination to maintain the political influence it has achieved in the Middle East in recent years, Weafer said.

That greater influence was on display in October 2017 when Saudi Arabia’s King Salman traveled to Moscow, the first-ever visit by the nation’s leader to Russia.

“The Kremlin will want to try to get back to the negotiating table because the political relations” with Saudi Arabia are “very important,” Weafer said.

This article originally appeared on Radio Free Europe/Radio Liberty. Follow @RFERL on Twitter.

popular

8 facts you didn’t know about First Kids

Being the President’s kid comes with plenty of perks. But even though it’s not an elected job, much like becoming the First Lady, it still comes with ample responsibilities. Public appearances, scrutiny that abounds, and of course, access to things that the average joe would never dream of … in good ways and bad.

Take a look at these little-realized facts about the First Kids — past and present — of the United States. 

  1. They look out for each other
Jenna and Barbara Bush with their grandfather, former President George Bush Sr. (Image courtesy of jennabhager, Instagram)

It’s stated that First Kids Chelsea Clinton reached out to the Bush twins, Barbara Pierce and Jenna, and they carried on the tradition. The pair even wrote a letter to Sasha and Malia Obama as they were ending their stint in the White House. 

2. They can decorate, while leaving historic aspects

When moving into the White House, yes if you live with your parents, that’s your home while Dad’s in office, the First Family has much sway in the overall decor and how their living quarters will look. However, as a historic residence, there’s also much they cannot change. Certain features must be left alone and while things like decor and paint can be adapted to taste, complete construction is a no-no. 

3. They can’t open windows

Not in the White House, nor in the car. We’re guessing it’s a security issue, but in any case, the action is forbidden. Former First Lady, Michelle Obama, stated that one of her daughters once opened a window in the White House and they received immediate calls asking for it to be shut. 

4. They get Secret Service security until 16

Even once they are no longer in the White House, former First Kids have access to Secret Security detail until they reach 16 years of age. The service can be declined, however, if the family chooses not to take it. However, while in office, the detail for minors is a must.

5. You’re subject to the media

The reasons and risks behind Russia’s big oil bet
Chelsea Clinton, left, Secretary of State Hillary Rodham Clinton and former U.S. President William Jefferson Clinton in 2011 (U.S. Navy photo by Chief Petty Officer John Lill)

Perhaps the biggest controversies took place in the 90s when teenaged Chelsea Clinton was publicly insulted on SNL and on the radio by Rush Limbaugh. The latter, making fun of her looks. Mike Meyers wrote an apology letter to the Clintons of the SNL skit. 

More recently, 10-year-old Baron Trump was offensively tweeted about by an SNL writer. The writer was briefly fired by NBC. 

Adult First Kids also receive public scrutiny, though theirs is seen as more socially acceptable. 

6. They usually attend private schools

To better work with security and get their kids the supervision they need as First Kids, most presidential children attend private schools. However, it’s not a rule. In fact, former President Jimmy Carter purposefully enrolled his 9-year-old daughter, Amy, in Washington D.C.’s public school system. Carter had campaigned that public schools were no worse than private ventures, and when it came to his own child, put his money where his mouth was. 

7. They can’t take official roles

The reasons and risks behind Russia’s big oil bet
Ivanka Trump visits the Ronald Reagan Building and International Trade Center to meet with United States Agency for International Development staff members in promoting her Women’s Global Development and Prosperity (W-GDP) Initiative, on January 9, 2020.  (USAID photo by Patrick Moore/Released)

As for adult children of the president, they aren’t allowed to work in the White House, that is officially. A 1967 anti-nepotism law went into effect, helping ensure that the president doesn’t have too much sway by bringing in family. However, Donald Trump’s daughter, Ivanka, and her husband, Jared Kushner, worked for former President Trump as unpaid advisors. 

8. Expensive gifts belong to the U.S.

When receiving anything as a gift, First Families have to turn in the item to the National Archive and have it appraised. Anything worth more than $390 has to be purchased out of pocket. The Obama girls, Hilary Clinton, and George W. Bush are all noted as having bought back important gifts they received while at the White House. 

MIGHTY MOVIES

A surprise ‘Die Hard’ sequel gives 2020 a much-needed jump start

Whether or not you agree with the popular theory that the 1988 action picture “Die Hard” is really a Christmas movie, you’ll have to admit that NYPD detective John McClane is Bruce Willis’ greatest role.

There have been four sequels of varying quality over the past decades, but it had been seven years since Willis had played the part. That changed over the weekend when a new “Die Hard” movie showed up on YouTube.


DIEHARD IS BACK | 2:00 Film

www.youtube.com

“Die Hard” 2020 is actually a commercial for DieHard, the iconic battery brand formerly owned by Sears and now sold by Advance Auto Parts. The spot brings back a pair of iconic characters from the original movie.

McClane’s car won’t start and he heads to an auto parts store for a new battery. He runs into the original movie’s computer hacker Theo (Clarence Gilyard Jr.), who’s still out for revenge 32 years later.

Theo sends a posse of musclebound thugs to finish off the detective, who crashes through the store window to buy his new battery. After escaping through the ventilation system, he runs into limousine driver Argyle (De’voreaux White), who’s finally paid off the same car he was driving in the first movie.

As they try to get back to McClane’s broken-down muscle car, Theo runs them down and crashes into the limo. The DieHard battery takes a bullet but still works when installed and they crank up the car for an escape.

Will Theo get his revenge or will McClane escape again with a few more scars but still in one piece? You’ll have to watch for the result.

If you’re shocked that Bruce was willing to play John McClane in a commercial, he’s got some thoughts for you.

“I’ve never done any sort of commercial with the John McClane character, but Advance Auto Parts brought an idea to integrate DieHard the battery into the ‘Die Hard’ story through a short film that’s authentic to McClane and both brands,” Willis said in a press release.

“Advance approached this like a motion picture — the script is clever, the production intense and the spot is entertaining,” he continued.” This is what ‘Die Hard’ fans expect. I think they will dig the DieHard –‘Die Hard’ mashup.”

Back in the day before its release, the movie title was a clever play on an iconic brand name. Over the years, the movie became a brand that’s probably bigger than the battery ever was. And now we’ve come full circle: A battery looks to get a boost from a movie that once got a boost from the battery.

Enjoy the spot and don’t get your back up. Bruce’s movie career got jump started by DieHard back in the day and now he’s returning the favor.

Here’s the classic DieHard battery commercial that the movie title was supposed to evoke for audiences back in 1988.

Diehard Battery Ad – Sears Roebuck Auto Center (1976)

www.youtube.com

This article originally appeared on Military.com. Follow @militarydotcom on Twitter.


MIGHTY CULTURE

MightyScopes for the week of March 18th

It’s Noadamus again, and I’m here welcome to the magical land of right now. Where the past is done and what it means is open to interpretation, the future is so far away you may never live to see it. Right now is the only moment you are guaranteed. Lightning could strike you down a second from now, a car could wander into your lane an hour from now, but right now, you are alive.

So, you should totally check out your horoscope, because if you are gonna die, you might as well open your mind hole to some wisdom from the stars first. Besides, you’ll probably be fine — this week.

See you soon, and remember, do flutter kicks.

Sincerely, Noadamus.


The reasons and risks behind Russia’s big oil bet

Pisces

If you find yourself complaining about free food and booze, stop. It’s free. If you don’t like it, don’t eat it. This is a good general rule. Most of the great things we are all blessed with in this life are not of our own making. You’re tall? You can’t take credit for it. You’re naturally creative? It’s a gift. When you take those gifts and develop them and feed them in healthy ways, you should feel both proud and grateful. When your life is perfect, little problems keep you from getting bored and complacent. This week will reminded you to pay attention and review your weaknesses and spend some real time addressing them. It could quite literally save your life this week. So do that PMCS and don’t finger drill it, corporal.

The reasons and risks behind Russia’s big oil bet

Aries

You have so many secrets that they are beginning to escape into other areas of your life. Wouldn’t it be easier to say f*ck it and just be yourself? You claim to be authentic and you are, for the most part, but don’t try so hard. Who cares if your friends don’t like your relationship choices? They don’t even like their own relationship choices. And if you find yourself doing the walk of shame back to the barracks right before morning PT, everybody will know about it before formation anyway. No point in hiding, so hit the shower and get out there, Marine.

The reasons and risks behind Russia’s big oil bet

Taurus

This week starts at a steady pace jumps to a sprint by the weekend. You are relentless. Grind everyone to dust with your continuous pace. Keep yourself centered and use this inertia to propel yourself into the future. While everyone around you is spinning, troubles roll right off your back this week. Keep moving this week and your efforts will be soon rewarded. If additional fitness or combatives training presents itself, jump on it. You’ll thank me for it later.

The reasons and risks behind Russia’s big oil bet

Gemini

A whole lotta excitement is coming your way in the relationship department, but not all of it is good. As the week starts, your social circle is displeased with your relationship choices, but by the end of the weekend, they will have accepted the idea and everyone will probably party their faces off, which means at least everyone’s doing something together. You have many things happening in the background, and by next week they will demand almost all of your attention.

The reasons and risks behind Russia’s big oil bet

Cancer

You might find yourself wondering how your job can be so incredibly rewarding and terribly soul-crushing at the same time. This is the duality of life, which the Cancer sign represents, btw. Things change — constantly — but before you decide to change things on your terms, take a knee, face out, and drink water. Do what needs to be done this week, the rest might resolve itself. Besides, worrying about it only affects the way you feel.

The reasons and risks behind Russia’s big oil bet

Leo

This week is a gift; technically, every moment is a gift, but this week is also a time of advancement. Let me rephrase —this is the time where you do the work that will pay off with incredible success later. Spending all week at the range? That will come to fruition soon. Embarking on a new fitness program? A more functional and aesthetically pleasing form awaits you in the near future. Your home and family life is far from perfect, but it is improving. Be grateful for what you have right now while working for a better future. You’re welcome, Chief. Consider yourself counseled.

The reasons and risks behind Russia’s big oil bet

Virgo

While you might not be the most adventurous person out there normally, this week ramps your risk-taking impulses up 11. Admittedly, you are extremely well suited to be victorious at the current moment, but no one wins at everything. So if the reward is not worth the risk, it’s a waste of valuable and limited time. Go kick some ass and have fun doing it; you deserve it.

The reasons and risks behind Russia’s big oil bet

Libra

The politics of power rule your home and family life, which is especially true at the moment. However, in addition to being oppressive and restricting, your familial connections are likely to aid in your investment or earning capacity. The secret to gaining this advantage without being consumed by family melodrama: Assert yourself as a powerful and influential member of the family who wishes to improve and grow the family with said advantage, then go do it.

The reasons and risks behind Russia’s big oil bet

Scorpio

You want the good news or the bad news first? The good news — finances are improving. The bad news — you are still spending way more money than you are bringing in. Money is meant to be spent, right? Totally, but wasting is different than spending. Your relationship is consuming other areas of your life, which is not a bad thing. Just remember you can’t go along with it now and complain about how your life is no longer your own later.

The reasons and risks behind Russia’s big oil bet

Sagittarius

One of your least favorite things is demanding way too much of your time this week. Yes, it is making you money and providing you with a sense of identity and purpose, but it is also getting in the way of doing whatever you want. Work can be tedious and a job does restrict your freedom, to some degree. But it increases your ability to so many other things you want in your life. So, put on those combat boots and get your ass to formation. Besides, civilians don’t get paid to blow sh*t up. Unless they are in demolitions, or mining, or maybe some other stuff, too…. Just shut up and move out.

The reasons and risks behind Russia’s big oil bet

Capricorn

Holy intensity, Bat Person! (no trademark infringements here) You are so smoldering right now; just be careful to maintain control over yourself so you don’t explode. Your creativity is ramped up to high this week. I’m not just talking about your much-neglected hobbies. We are talking all creativity. From innovative ideas at work to new moves on the field to your secret poetry (I won’t tell anybody) to creating babies. In this extremely fertile period in your life, remember: Always practice safe poetry.

The reasons and risks behind Russia’s big oil bet

Aquarius

Listen up, private. The federal income tax system is not a conspiracy to steal the hard earned wealth of the average citizen. Okay, maybe it is a little, but it is also supposed to go to improving and maintaining public services and areas facilities of public use. So, even though you ‘don’t believe in taxes,’ you can still be audited (and just might be this year). So, you should probably review all of those ‘expenses’ you claimed this year.

MIGHTY HISTORY

3 questions of unconventional warfare according to a top officer

Unconventional warfare is necessarily a messy business. It entails finding the enemies of our enemies and convincing them to fight our mutual foes, even if we’re not necessarily friends. It reduces America’s risk in blood, but it also means our national security rests on the shoulders of foreign fighters. In the confusing situations this creates, one top officer in the Afghanistan invasion had three simple questions to cut through the chaos.


The reasons and risks behind Russia’s big oil bet

U.S. special operators pose with Hamid Karzai during the invasion of Afghanistan. Karzai would go on to be president of Afghanistan.

(U.S. Army)

During the invasion, then-Lt. Col. Mark Rosengard was in command of Task Force Dagger, and he had to greatly expand the unconventional warfare program in the country. So he couldn’t spend days or weeks of time and reams of paper figuring out whether he would trust one potential guerrilla leader or another.

So, according to reporter Sean Naylor in his book Not a Good Day to Die, Rosengard just asked three questions.

First, “Do we have a common goal today, recognizing tomorrow may be different?” Basically, do the militiamen or guerillas want the same outcome as the American forces? Including, do they want to see the same people die?

Next, “Do you have a secure backyard?” Simply, do the local forces have somewhere safe-ish to train? If the forces have to constantly quit training in order to fight off attacks, then they won’t be able to actually train. But if there’s any sort of safe compound in which to get to work, then it’s time to ask the third question.

“Are you willing to kill people?”

Yeah, that’s not a very complicated one.

Taken together, these three questions would let Rosengard know whether he could get to work with a new commander. Of course, there were additional concerns that he had to keep track of.

The reasons and risks behind Russia’s big oil bet

Afghan forces in a discussion with a senior weapons sergeant of the U.S. Army’s Special Forces.

(U.S. Army)

For instance, on the first question, you would need to keep track of whether the militias might really turn on you tomorrow. It’s a bad idea to spend too much time training foreign fighters who only have a few days or weeks of loyalty to America left.

But, overall, these three questions match up with American choices in other wars.

Gen. John “BlackJack” Pershing made alliances with Moro tribesmen in the Philippines and hired them as law enforcement officers even though he knew their long-term goals would be different. And President Franklin D. Roosevelt allied America with Russia to destroy Germany, adding the Soviet Union to the Lend-Lease Act of 1941 despite it being clear that the U.S. and Soviet Union would eventually be at loggerheads.

Rosengard’s gambles in Afghanistan largely worked out for the invasion, and U.S. special operators and unconventional forces took large sections of the country in the Winter of 2001, a period in which they had planned to take just a small foothold in the north. The operators and their guerrilla allies also were able to bring Hamid Karzai back to the country to take power, helping cement American control of the country.

But, of course, the issues with Afghan forces in the invasion were quickly felt. Pashtun tribesmen were extremely helpful in taking the country from the Taliban, but their half-hearted attacks at Tora Bora are thought to have been a major contributor to Osama Bin Laden’s escape from that mountain stronghold into Pakistan where he would successfully hide until his death in 2011.

MIGHTY CULTURE

The 7 universally important things to know before any boot camp

Everyone who enters the US military these days will go through basic training. Although each branch of the military (including the Coast Guard) has a markedly different experience in their initial training days, there are things a young would-be troop can know and do to prepare themselves mentally and physically for whatever service they’re about to enter, regardless of gender.

Prepare to fear and then respect the campaign hat, pukes.


The reasons and risks behind Russia’s big oil bet

Tech. Sgt. Edroy Robinson, 331st Training Squadron military training instructor, observes as new Air Force basic training arrivals prepare to get a haircut May 20, 2015, at Joint Base San Antonio-Lackland, Texas.

(U.S. Air Force photo by Johnny Saldivar)

Show up with a neat appearance.

Your fellow trainees/recruits will appreciate this. You will appreciate this eventually. You probably know before going that part of basic military training means you will be stripped of your hair and your civilian clothes. You will be given the same haircut as everyone else and wear the same clothes as everyone else. But before that happens, there’s a lot of waiting.

When you get off the bus, you will be tired and maybe dirty from traveling all day. You will feel gross. None of that will matter, though. Your introduction to military service begins with a hurry up and wait that could take most of a day and into the next. You may not see a rack or shower for some time. If you prepared for this, you and those around you will be grateful.

The reasons and risks behind Russia’s big oil bet

New recruits with Lima Company, 3rd Recruit Training Battalion, make their initial phone calls home at Marine Corps Recruit Depot San Diego, May 21, 2018.

(MCRD San Diego)

Dress conservatively.

This goes double for Marine Corps recruits. The goal is to not draw attention to yourself, to try to blend in. The whole time you were tired from getting to basic training, the drill instructors/drill sergeants/training instructors/recruit division commanders were watching you. The first thing they notice about you could stick with you for the entire time you’re in boot camp.

Consider a plain-colored tee shirt or other comfortable gear to wear to basic training.

The reasons and risks behind Russia’s big oil bet

Don’t take it personally.

The men and women in charge of shaping your civilian lump into a part of the world’s best combined-arms fighting force have been doing it for some time. They know exactly what it means to be a part of your entry in the U.S. Military. As a matter of fact, their basic training to teach your basic training was much, much more difficult than your basic training.

Training new recruits is one of the hardest jobs to get and keep in the U.S. military, and those who wear the Smokey Bear hat went through a lot to be there. No one cares more about making you a capable fighter than the person under that hat. If they’re giving you a hard time, there’s a reason for it.

The reasons and risks behind Russia’s big oil bet

A basic combat training soldier acting as a casualty is carried by members of his squad toward their command post after a simulated attack on their patrol July 20, 2016, during his BCT company’s final field training exercise at Fort Jackson, S.C.

(U.S. Army photo by Sgt. Javier Amador)

Move like you mean it.

They’re awake before you are and they go to bed after you do. They put all their time and effort into molding you into the shapes of soldiers, sailors, airmen, and Marines. The least you can do is act like it means something to you. If you aren’t “moving with a sense of urgency” by the end of the first week, you’re showing total disrespect to everyone around you who is.

The reasons and risks behind Russia’s big oil bet

(U.S. Navy)

Be in some kind of shape.

Compared to most of the other things you’ll do with your life – especially your military life – basic training is rather easy. But it will be a whole lot more difficult for you if you were so out of shape in your civilian life that you may not hack it as a U.S. troop. But your window for getting in shape doesn’t have to be limited to the eight to twelve weeks you’ll spend in basic military training. If you can show up halfway there, you’ll be doing yourself a real favor.

The reasons and risks behind Russia’s big oil bet

An Air Force Basic Military Training dining facility.

(U.S. Air Force)

Learn how to address others.

Every branch has different rules for this in basic training, but it’s one of those little things that can show your instructors some respect while opening doors for you – literally. You will have to learn how to refer to your instructors, how to refer to yourself, and how to speak to those in your chain of command. You will have to do this for almost everything from answering questions to eating to going to the bathroom.

Life is so much easier when you know how to respond in these situations.

The reasons and risks behind Russia’s big oil bet

It gets better.

(U.S. Marine Corps)

Do not ever think of giving up.

When you arrive, there will likely be a quick flash where you wonder just what the hell you’ve gotten yourself into. A quick situational awareness check will tell you that there are hundreds of others around you, doing the same thing, probably having the same idea. Everyone else will push past the defeatism and embrace the situation – and you will not be happy until you do the same.

For most people who go through the military, finishing basic training is one of the most satisfying achievements of their lives. For the people that quit, it becomes their biggest regret. The choice is simple.

MIGHTY TACTICAL

Russia already threatened the US with its ‘doomsday device’

Since 2015, when images of a Russian nuclear torpedo first leaked on state television, the world has asked itself why Moscow would build a weapon that could end all life on Earth.

While all nuclear weapons can kill thousands in the blink of an eye and leave radiation poisoning the environment for years to come, Russia’s new doomsday device, called “Poseidon,” takes steps to maximize this effect.

If the US fired one of its Minutemen III nuclear weapons at a target, it would detonate in the air above the target and rely on the blast’s incredible downward pressure to crush it. The fireball from the nuke may not even touch the ground, and the only radiation would come from the bomb itself and any dust particles swept up in the explosion, Stephen Schwartz, the author of “Atomic Audit,” previously told Business Insider.


But Russia’s Poseidon is said to use a warhead many times as strong, perhaps even as strong as the largest bomb ever detonated. Additionally, it’s designed to come into direct contact with water, marine animals, and the ocean floor, kicking up a radioactive tsunami that could spread deadly radiation over hundreds of thousands of miles of land and sea and render it uninhabitable for decades.

In short, while most nuclear weapons can end a city, Russia’s Poseidon could end a continent.

Even in the mania at the height of the Cold War, nobody took seriously the idea of building such a world-ender, Malcolm Davis, a senior analyst at the Australian Strategic Policy Institute, told Business Insider.

So why build one now?

The reasons and risks behind Russia’s big oil bet

A briefing slide captured from Russian state TV is said to be about the Poseidon nuclear torpedo.

(BBC)

A NATO-ender

Davis called the Poseidon a “third-strike vengeance weapon” — meaning Russia would attack a NATO member, the US would respond, and a devastated Russia would flip the switch on a hidden nuke that would lay waste to an entire US seaboard.

According to Davis, the Poseidon would give Russia a “coercive power” to discourage a NATO response to a Russian first strike.

Russia here would seek to not only reoccupy Eastern Europe “but coerce NATO to not act upon an Article 5 declaration and thus lose credibility,” he said, referring to the alliance’s key clause that guarantees a collective response to an attack on a member state.

Russian President Vladimir Putin “has made it clear he seeks the collapse of NATO,” Davis continued. “If NATO doesn’t come to the aid of a member state, it’s pretty much finished as a defense alliance.”

Essentially, Russia could use the Poseidon as an insurance policy while it picks apart NATO. The US, for fear that its coastlines could become irradiated for decades by a stealthy underwater torpedo it has no defenses against, might seriously question how badly it needs to save Estonia from Moscow’s clutches.

The reasons and risks behind Russia’s big oil bet

Russian President Vladimir Putin.

“Putin may calculate that NATO will blink first rather than risk escalation to a nuclear exchange,” Davis said. “Poseidon accentuates the risks to NATO in responding to any Russian threat greatly, dramatically increasing Russia’s coercive power.”

Davis also suggested the Poseidon would make a capable but heavy-handed naval weapon, which he said could most likely take out an entire carrier strike group in one shot.

Russia’s new nuclear ferocity

Russia has recently signaled its willingness to use nuclear weapons to coerce the West with its violation of the Intermediate-Range Nuclear Forces Treaty, Davis said. These missiles are purpose-built for taking out European capitals from the Russian mainland.

But Russia has frequently engaged in nuclear saber-rattling when it feels encircled by NATO forces, and so far it has steered clear of confronting NATO with kinetic forces.

“Whether that will involve actual use or just the threat of use is the uncertainty,” Davis said.

While it’s hard to imagine a good reason for laying the kind of destruction the Poseidon promises, Davis warned that we shouldn’t assume the Russians think about nuclear warfare the same way the US does.

Featured image: AtomCentral.com

This article originally appeared on Business Insider. Follow @BusinessInsider on Twitter.

MIGHTY HISTORY

Here’s how to safely land NASA’s bomber with an engine out

When soaring through the skies, thousands of feet above the ground, the last thing a pilot wants to deal with a faulty engine. Those in single-engine jets are typically left with one option: Getting out of the plane. For most military planes, this means it’s time to grab the “loud handle” and trigger the ejection seat.

But if you’re in a multi-engine plane, you have a chance to bring the plane back safely. The key word here is chance.


How big or small that chance is depends greatly on circumstance. What type of plane is it? How did the engine go out? Is there any other damage to the plane? How well-trained is the pilot?

The reasons and risks behind Russia’s big oil bet

B-57 Canberra bombers were tricky enough to fly — when both engines worked.

(USAF)

This last question is crucial. Flying a plane back to base with an engine out is no simple task. The thrust propelling a plane is going to be very different — and if you don’t adjust, you’ll lose control.

One plane for which that recovery is especially tricky is the B-57, three of which are still in service with NASA today. The plane, when fully functional, is very touchy — as evidenced by its high accident rate. This plane has two engines, so if you lose one, you lose half your thrust. What remains is uneven. So, pilots had to be specially trained for such an event — but conducting that training in the plane could make for some very costly lessons.

The reasons and risks behind Russia’s big oil bet

NASA has three B-57s in its inventory — including this one, with the tail number 928.

(NASA)

Check out the video below from 1955 to see how pilots were trained to conduct a single-engine landing. The instructions might be over 50 years old, but some lessons are timeless.

https://www.youtube.com/watch?v=RfLdEGdyuIo

www.youtube.com

MIGHTY TRENDING

What could 5,000 troops do in the Venezuela crisis?

Venezuela has descended into a political crisis after years of economic turmoil and a note from National security Adviser John Bolton has floated the idea of sending 5,000 U.S. troops there to help end the political standoff by backing one of the claimants to the presidency, Juan Guaidó. So, what’s exactly going on? And what could 5,000 troops actually accomplish?


The reasons and risks behind Russia’s big oil bet

Venezuelan President Hugo Chavez, seen here while not allegedly killing his political opponents.

(Agência Brasil, CC BY 3.0)

Recent history

Let’s start with the recent history of the country. If you vaguely remember a lot of protests on your TV as well as a lot of social media commentary around whether or not socialism was bad, chances are you’re remembering Venezuela.

Basically, Venezuela was a U.S.-aligned democracy for much of the Cold War, but a movement towards socialism was championed by populist Hugo Chavez (you’ve likely heard of him) who was elected president in 1998 and took office in February 1999. Chavez’s populist priorities immediately ran into trouble as low oil prices and other economic problems made his socialist overhaul of the country unaffordable.

Chavez cemented his hold by training up a paramilitary loyal to him, issuing decrees, and spreading propaganda, all of which eventually triggered protests and uprisings against him. Chavez survived a coup attempt in 2002. Allegations that the U.S. assisted in the coup persist to this day, even though Chavez, senior coup leaders, and the U.S. have all either denied it or said it was unlikely.

After the coup, rising oil prices allowed Chavez to finally follow through on many of his campaign promises and buy loyalty.

So, the Chavez era was rocky, to say the least, but it became worse when he died in 2013 and Nicolás Maduro took over.

The reasons and risks behind Russia’s big oil bet

Nicolás Maduro. The usage rights for this photograph require that it not be used in a way that would disparage the coat of arms or flag, so we can’t comment on how humorous it would or would not be for a chubby man, famous for eating on public TV while his country starved, dressed up in the Venezuelan colors and posed in front of a lean Simón Bolívar.

(Government of Venezuela)

Maduro lacks the charisma and the political history that Chavez enjoyed, and he ran right into the same fallen oil price problems that had plagued Chavez. His attempts to hold onto power amid growing unrest and economic scarcity failed, and uprisings, extreme scarcity, and starvation have plagued the country in recent years.

And all of that has led up to the 2018 elections which resulted in Maduro carrying all 23 states and about 68 percent of the vote; but there were tons of irregularities in the election, and less than a third of the population trusted the government to hold a free and fair election.

After the elections, continuing protests led to National Assembly Speaker Juan Guaidó declaring himself acting president. America reportedly voiced support for the move secretly ahead of time, but the U.S. definitely voiced public support after the fact, with Vice President Mike Pence recording a video addressing the Venezuelan people.

The reasons and risks behind Russia’s big oil bet

March for peace in 2015. Peace has struggled a bit in the years since.

(Carlos Díaz, CC BY 2.0)

So, yeah, people have different ideas of who the proper president of Venezuela is, but the U.S. is officially backing Guaidó as interim president, and National Security Adviser Bolton showed off a legal pad with a note about sending 5,000 troops to the country, ostensibly to back up Guaidó.

We won’t get into the politics of the discussion, but what could 5,000 troops do successfully in the country when the actual military has 515,000 personnel, counting the national guard and militia? After all, America sent 26,000 troops to Panama to oust Noriega, and Panama had around 15,000 troops at the time. Fewer than 4,000 were actual soldiers.

A RAND report from 1996 pointed out that the U.S. enjoyed massive advantages in Panama, from public support to ample training to little real resistance, and that soldiers and leaders in future contingency operations should not expect such an easy path. So, what will 5,000 troops be able to accomplish in Venezuela?

The reasons and risks behind Russia’s big oil bet

U.S. Marines are less welcome on some doorsteps than missionaries. Our guess is that Maduro would rather see the missionaries.

(U.S. Navy Mass Communication Specialist 3rd Class Danielle A. Baker)

The quick answer is: not much. 5,000 troops would be more a show of support than an actual military deterrent. At most, the troops could secure a few buildings or key locations. But, given the political fracturing in the country, that actually might be enough to tip the scales in Guaidó’s favor, hopefully without triggering a major conflict.

First, Maduro’s control of the military appears to be quite fragmented. There are still supporters of democracy and capitalism in the country as well as a larger base of support for true socialism instead of the crony socialism under Maduro, who has eaten pies on TV while his people starved. The Venezuelan military seems to have a quiet minority that would support a change in leadership even though most high-level military leaders are in place due to appointments made by Maduro.

So, 5,000 U.S. troops combined with the hollow support in the ranks for Maduro might give Maduro supporters pause before they use force to put down Guaidó’s bid.

The reasons and risks behind Russia’s big oil bet

You really don’t want these guys to show up in the plains near your capital city.

(U.S. Army Lt. Col. John Hall)

Next, there is currently an unofficial supreme court in exile known as the Supreme Tribunal of Justice for Venezuela in exile. It has 33 jurists who hold court every 15 days via Skype. It has sentenced Maduro to 18 years in prison, referred Venezuelan leaders to the Hague, and even supported Guaidó before he announced. And the Lima Group, a consortium of 12 Latin American countries plus Canada, supports the court.

If the U.S. followed up its recognition of Guaidó by recognizing the tribunal, it could bolster support for Guaidó and give legitimacy for the court. And 5,000 troops are more than enough to protect the court if it returned to Venezuela.

(A quick note about the court, though: The court may be one reason why the military hasn’t moved against Maduro already. Some of those leaders referred to the Hague are military leaders, and plenty of leaders and soldiers could face charges if Guaidó takes the presidency and doesn’t grant amnesty.)

Finally, the presence of 5,000 U.S. troops, regardless of their deployment and stated mission, always ups the ante. Attacking the 5,000 risks American retaliation from warships and submarines that could be lurking off coast or quickly deployed nearby. Fun fact: the U.S. Navy could hit wide swaths of Panama from the Atlantic or the Pacific, provided the ships firing from Pacific side have the permission of Panama and/or Colombia.

And the U.S. Air Force could quickly muster planes for strikes out of Puerto Rico if necessary. The U.S. has an Air National Guard base only 560 miles from Caracas, meaning F-22s could hit the capital as long as they could top off on gas from a tanker flying over the Caribbean Sea.

But, the best thing could be 5,000 troops as a sort of threatening token never deployed. Bolton can exert pressure on Maduro and his government just by showing up at a press conference with two lines of ink on a legal pad. If that gives National Assembly supporters enough ammo to push Maduro from power without more violence, great.

But it does raise the specter that the threat of a U.S. troop deployment will make an actual deployment more necessary.

popular

How the Persian Immortals became masters of psychological warfare

War is just as much a psychological battle as it is physical. If you’re able to convince your enemy that they have no chance of surviving before the first drop of blood is spilled, you’ve already won. No warriors in history have embodied this concept better than the Anausa or, as they’re more commonly known, the Persian Immortals.

Even their very name, “Immortal,” is a part of the mind tricks they played on their enemies. In order to keep up the image of being unkillable, they wore matching uniforms and hastily recovered their dead or wounded, fueling the illusion that none fell in battle. But that barely even scratches the surface of the psychological warfare the Persians employed to conquer 44 percent of all humanity at the height of their power in 480 B.C.


The reasons and risks behind Russia’s big oil bet
As over-the-top as the rest of “300” was, this is an entirely accurate scene. The rest of the movie, though? Ehhh…(Warner Bros. Pictures)

As with many early civilizations, much of the history of Achaemenid Empire (to Empire for which the Immortals fought) has been lost to time. The history we do have comes from the Greek scholar, Herodotus. Though he opposed Persia, he kept detailed battle plans of the Immortals and those that faced them.

One such example happened to make its way into the 2006 film, “300.” A Spartan at Thermopylae scoffed at a Persian envoy who said their arrows could “black out the sky” by replying, “then we’ll fight in the shade.” That wasn’t just a boast — that actually happened.

The Immortals were well aware that their arrows were inferior to Spartan steel. So, instead of making them stronger, they made more of them so that every archer could unleash them in one, rapid moment, literally blacking out the sky with arrows.

The reasons and risks behind Russia’s big oil bet
“Cats! Our only weakness!” – Some Egyptian, probably. (Ancient History Museum)

Another example of the ferocity of the Immortals was when the Persians defeated the Egyptians at the Battle of Pelusium. The Persians knew that the Egyptians were faithful to the Egyptian Goddess of Cats, Bastet. To the Egyptians, any harm done to a cat was considered great sacrilege.

Knowing this, the Persians simply drew cats on their shields and let loose a bunch of cats onto the battlefield. This alone was enough to make many Egyptians immediately surrender. When the other Egyptians manned their catapults, the Persians would let them know that they had cats with them — and that unleashed the artillery could mean killing a few felines.

If the Immortals didn’t have enough time to prepare for an individual opponent, they’d resort to their shock-and-awe cavalry, armed with sagaris, or long axes. The lightweight ax made it easy for Immortals to twirl them over their heads and swing fast enough to make an enemy’s blood splash far enough back to intimidate their foes.

At the Battle of the Granicus in 334 B.C., Alexander II of Macedon was nearly scalped by an Immortal cavalryman named Spithridates. His ax sliced clean straight through Alexander’s helmet and was just millimeters away from being a fatal blow.

After that moment, Alexander swore to the destruction of Persia. He studied their tactics and instructed his men on how to counter their advances. This took away the Persian’s edge in battle, and Alexander, from then on, took on the moniker of “the Great.”


Features images: Wikimedia Commons

MIGHTY HISTORY

This Bearcat has been unjustly overshadowed by history

When you think about Grumman fighters, the Wildcat, the Panther, and the Tomcat all spring to mind. And for good reason — these planes are all classics. But there is one Grumman fighter that didn’t quite get a chance to shine in World War II, but it did see some action in Southeast Asia.


The reasons and risks behind Russia’s big oil bet

Grumman F8F Bearcats line up on the Essex-class aircraft carrier USS Valley Forge (CV 45)

(U.S. Navy)

During World War II, the Navy was deploying the F6F Hellcat and the F4U Corsair was operated by the Marine Corps. The Hellcat was a very tame plane, but the Corsair — known as the “Ensign Eliminator” and foisted on the Marines — simply had higher performance. The Navy wanted the best of both planes. They wanted the F8F Bearcat.

The reasons and risks behind Russia’s big oil bet

French F8F Bearcats prepare to take off to carry out a napalm strike in Southeast Asia.

(U.S. Navy)

At the heart of the Bearcat was the Pratt and Whitney R-2800. This was the powerplant used by both the Corsair and Hellcat, but the Bearcat was much lighter, which gave it extreme performance. The Bearcat also packed a significant punch — to the tune of four M2 .50-caliber machine guns. If that wasn’t enough, the Bearcat was also able to haul five-inch rockets or a 1,000-pound bomb.

The Bearcat’s primary mission was to intercept enemy planes. The plane had a “bubble” canopy (pretty much a standard feature on today’s fighters) to improve the situational awareness of pilots. The Bearcat had a top speed of 421 miles per hour and a maximum range of 1,105 miles. It stuck around long enough to see some upgrades, but was quickly replaced by the onset of fighter jets, like the F9F Panther.

https://www.youtube.com/watch?v=UkeN4riBy4A

www.youtube.com

The Bearcat did see some combat, though. The French acquired Bearcats from the United States and used them in Southeast Asia. Some of those same planes were later passed on to the South Vietnamese.

The Bearcat also got some time in the spotlight when it was flown by the Blue Angels, from 1946 to 1950.

Learn more about this almost forgotten Grumman cat in the video below.

MIGHTY CULTURE

7 unexpected downsides to deploying to a combat zone

Deploying is just one of those things every troop knows will happen eventually. There are two ways troops look at this: Either they’re gung-ho about getting into what they’ve been training to do for years or they’re scared that they’ll have to do what they’ve been training years to do for years. No judgement either way, but it’s bound to happen.

The truth is, combat only makes up a fraction of a fraction of what troops do while deployed. There are some troops who take on an unequal share of that burden when compared to the next, but everyone shares some of the same downsides of deployment.

Today’s troops have it nicer than those that came before them and some units may inherently have an easier time of things. Still, everyone has to deal with the same smell of the “open air sanitation pits” that are lovingly called “sh*t ponds.”


The reasons and risks behind Russia’s big oil bet

Yep. And the VA is still debating whether this is unhealthy or not.

(Photo by Sgt. 1st Class Erick Studenicka)

Sanitation

Speaking of open pits of disposed human filth that are totally not going to cause health problems down the road, the rest of your deployment won’t be much cleaner.

Sand will get everywhere no matter how many times you sweep. Black mold will always creep into your living areas and cause everyone to go to sick call. That’s normal.

What’s not normal is the amount of lazy, disgusting Blue Falcons that decide that using Gatorade bottles as piss pots is more convenient than walking their ass to a proper latrine but get embarrassed by their disgusting lifestyle so they horde that sh*t under their bunk in some sick, twisted collection. True story.

The reasons and risks behind Russia’s big oil bet

That is, if you can get to an uncrowded USO tent to actually talk to your folks back home.

(U.S. Navy photo by Petty Officer 1st Class Jonathan Carmichael)

OPSEC

Everyone knows they’re going to have to be away from their family, but no one really prepares you for the moments when you’re going to have to tell them you can’t talk a few days because something happened — “Comms Blackouts.” They’re totally normal and it freaks out everyone back home. it’s up to the troops to explain the situation without providing any info that would incur the wrath of the chain of command.

We’ve all heard the constant, nebulous threats. “The enemy is always listening!” “All it takes is one puzzle piece to lose the war!” Such concerns aren’t unfounded — and it leaves troops clammed up, essentially without anything interesting to talk about while deployed.

The reasons and risks behind Russia’s big oil bet

I’m just saying, we’re doing you a favor by not saluting you where there could be snipers…

(U.S. Marine Corps photo by Cpl. Alejandro Pena)

Other units’ officers

Every unit falls under the same overarching rules as set forth by the Uniform Code of Military Justice. So, if someone’s doing something that breaks said code, any troop can (and should) step in to defuse the situation. That being said, every unit functions on their own SOPs while downrange and there’s always going to be a smart-ass butterbar who raises hell about not being saluted in a combat zone.

The reasons and risks behind Russia’s big oil bet

Don’t worry, though. This guy will probably have a a “totally legitimate” copy of all the seasons of ‘Game of Thrones’ on DVD.

(Official Marine Corps Photo by Eric S. Wilterdink)

Everything you’re going to miss out on

Being deployed is kind of like being put in a time capsule when it comes to pop culture. Any movie or television show that you would normally be catching the night of the release is going to end up on a long checklist of things to catch up on later.

To make matters worse, troops today still have an internet connection — just not a very good one. So, if some big thing happened on that show you watch, it’s going to get spoiled eventually because people assume that, after a few weeks, it’s all fair game to discuss. Meanwhile, you’re still 36 weeks away from seeing it yourself.

The reasons and risks behind Russia’s big oil bet

You’d think this isn’t comfy. But it is.

(U.S. Army)

Sleep (or lack thereof)

Some doctors say that seven to nine hours of sleep are required for the human body to function. You will soon laugh in the face of said doctors. You’ll be at your physical peak and do just fine on five hours of constantly interrupted sleep.

War is very loud and missions occur at all hours of the day. What this means is just as soon as you get tucked in for the night, you’re going to hear a chopper buzz your tent while a barely-working generator keeps turning over which is then drowned out by the sounds of artillery going off. Needless to say, when the eventual IDF siren goes off, you’ll legitimately debate whether you should get out of bed or sleep through it.

The reasons and risks behind Russia’s big oil bet

Ever wonder why so many troops make stupid films while in the sandbox? Because we’re bored out of our freakin’ minds!

Boredom

The fact that you’re actually working 12-hour days won’t bother you. The fact that you’re going to get an average of five hours of sleep won’t bother you. Those remaining seven hours of your day are what will drive you insane.

You could go to the gym and get to looking good for your eventual return stateside. You could pick up a hobby, like learning to play the guitar, but you’d only be kidding yourself. 75 percent of your time will be spent in the smoke pit (regardless if you smoke or not) and the other trying to watch whatever show is on at the DFAC.

The reasons and risks behind Russia’s big oil bet

“Oh, look! It seems like everyone came back from deployment!”

(U.S. Army)

All that money (and nothing to spend it on)

Think of that episode of The Twilight Zone where the world’s end comes and that one dude just wants to read his books. He finally finds a library but — plot twist — he breaks his glasses and learns that life is unfair. That’s basically how it feels when troops finally get deployment money. It’ll be a lot more than usual, since combat pay and all those other incentives are awesome, but it’s not like you can really spend any of it while in Afghanistan.

If you’re married, that money you’re be making is going to be used to take care of your family. Single troops will just keep seeing their bank accounts rise until they blow it all in one weekend upon returning.

Articles

Wells Fargo illegally repossessed hundreds of US troops’ cars

While Army National Guardsman Dennis Singleton was getting ready to deploy to Afghanistan, Wells Fargo suddenly repossessed his car. Now Singleton is getting some retribution.


The Justice Department says the repossession was illegal under the Servicemembers Civil Relief Act, which requires Wells Fargo to get a court order before repossessing a military member’s vehicle. DOJ also says the bank didn’t stop there. According to the Los Angeles Times‘ Jim Puzzanghera, Wells Fargo charged Singleton and his family a $10,000 balance and then reported the repossession to credit agencies.

Wells Fargo allegedly did the same thing 413 times, according to the Justice Department — more in a series of misdeeds and misuses of customer information that now has the bank and its CEO in hot water, especially with the U.S. Congress.

CNN’s Jackie Wattles reports the bank will pay $10,000 to each service member, with interest. They will also pay for the lost equity on the cars and repair their credit for a total of $4.1 million.

Wattles’ report says the Office of the Comptroller of the Currency also fined Wells Fargo $20 million for denying federally mandated protections for active duty military members, which includes capping interest rates at 6 percent.

The reasons and risks behind Russia’s big oil bet
This is Wells Fargo making off with your credit rating.

“In those instances where some service members did not receive the appropriate benefits and protections, we did not live up to our commitment and we apologize,” the company said in a statement. “We have been notifying and fully compensating customers and will complete this work in 60 days.”

Aside from its infractions against military members, Wells Fargo is also accused of creating millions of fake bank and credit card accounts over five years. The bank allegedly set up an incentive system for its employees who falsified customer accounts to reach sales targets.

The reasons and risks behind Russia’s big oil bet

In its largest fine to date, the Consumer Finance Protection Bureau fined Wells Fargo $185 million for opening 1.5 million fraudulent deposit accounts and more than 560,000 credit card accounts in its customers’ names. The bank repaid $5 million to its affected customers.

Since the story broke, Wells Fargo fired 5,300 of its employees, withheld $41 million of CEO John Stumpf’s unvested stock awards, and denied him an annual bonus as well as a chunk of his $2.8 million salary.

The reasons and risks behind Russia’s big oil bet
Wells Fargo CEO John Stumpf testifies before the House Financial Services Committee. (Photo: CSPAN)

The New York Times reports that in recent years, the bank has paid $10 billion in fines for violations like subprime loan abuses, discrimination against African-American and Latino mortgage borrowers, and various home foreclosure violations.

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