#2
'Russians are the Soviet Slaves of Today,' Panfilov Says
Paul Goble

Staunton, June 10 - The Soviet system transformed the population of the USSR into slaves of a particular type, and "the present-day Russian slave is a direct descendent of the Soviet ones," according to Oleg Panfilov, the director of the Center for Extreme Journalism (2000-2010) and now a professor at Georgia's Iliya State University.

Anyone who thinks that "a contemporary Russian has emerged is deeply mistaken." To be sure, "an insignificant percent of Russians have been abroad, acquired new cars and already cannot imagine life without good clothes and shoes ... But all these goods of 'world civilization' have changed Russians only externally" (ru.krymr.com/content/article/27061842.html).

"Internally, they remain the very same Soviet slaves to a great degree envious and as before uneducated. Only now the Russian slave has another ideology; he must now respect 'the Russian world' and its leader Putin," ideas that are just as unclear as the ones Soviet communists tried to impose.

Despite the years that have passed since the end of the USSR, "the slaves are struggling for the right to remain slaves." The hatred they show toward Ukraine and Georgia are part and parcel of this, Panfilov continues, a reflection of "envy and hatred and a desire to punish those countries for their decisions to become independent."

Soviet slaves constantly thought about the need to "become a hero," to die for whatever cause the leaders announced.  "But in order to die heroically, one must fight; and they are going now to do just that," from the lack of something better after having watched "propaganda on television."

"A few really want to be heroes," Panfilov says, "because throughout their lives they have heard the strange song with the words 'and as one we will die in the struggle for this,'" "'this'" being whatever the current leader - and that is now Putin says it is.  "For 74 years, Soviet people went to die for 'peace in the entire world' and for the victory of communism. Now, they do so for 'the Russian world.'"

"To speak with a slave is impossible," he continues. A slave "does not listen to any arguments, he does not know what logic is. He hates everything Western but he wears clothes produced there, he drives cars from there, and he goes online."  And he satisfies himself that this is not a problem because as his leaders tell him "'they fear us.'"

"In this strange situation," Panfilov says, "when the Kremlin opposes the West, the slave fights passionately but not for the opportunity to live well but simply for an empty idea which won't be realized." But if anyone calls attention to the slavish status of Russians today, the latter will be sure to respond with the Leninist dictum: "'we are not slaves, slaves are not we.'"

That response, of course, confirms what they are denying and highlights the continuity from Lenin's time to now, Panfilov says.  The Bolsheviks, as he points out, simultaneously said they were seeking to free Russians from slavery to various institutions like the church and made them slaves to new ones.

That reply too is significant, he suggests. After all, it was the Bolsheviks and not him who "first called the Russians slaves."

"Over the years of Soviet rule they created a new type of slave, the Soviet man who considered that the USSR and now Russia is the best country in the world and that all must fear it." Creating this kind of slave took enormous time and effort because it involved eliminating from people all human values and cultivating the deification of whoever was in power.

The Soviet population was transformed into "physical slaves - 'he who does not work does not eat'" and into mental ones as well, making that population willing to put up with anything that the leaders insisted on.  That by the way, Panfilov says, is the source of corruption in Russia today with only this difference: in Soviet times, the party regulated corruption, "now corruption controls the powers that be."

The Soviet leadership promoted in the population under its control "a constant feeling of envy, to neighbors, colleagues, relatives, foreigners, to all who had something and that was impossible to acquire."  But it did even more than that: it made each of those on its territory "an ideological slave."

That was "the perfected essence of Homo Soveticus," Panfilov concludes, an individual "who all his live lived in poverty and stood in lines ... who loved his leader and then with the appearance of a new leader hated him."  The main thing for such an individual then and now, was "not to think for himself: the leaders will explain everything."

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 #3
Euromaidan Press
http://euromaidanpress.com
June 9, 2015
Tatar historian: 'Russians are no more European than are the Tatars'
By Paul Goble
 
European scholars now recognize that no one can understand the present without a thorough understanding of the Middle Ages, and they are beginning to include in that understanding the Golden Horde, as a recent conference in Leiden shows, according to Rafael Khakimov, the vice president of the Tatarstan Academy of Sciences.

Unfortunately, he continues, Russian scholars are not in a good position to help them. On the one hand, the study of the past remains extremely politicized. "Heaven forbid that you find anything positive in Tatar history... or anything negative in Russian history." In the former case, you'll be denounced as a separatist; in the latter, as "an enemy of this branch of humanity."

And on the other hand, Khakimov continues, "the next generation of historians will not soon appear: they have ceased to be trained. No one apparently needs historians or an honest history. No one welcomes the latter," especially if it leads to the explosion of old but very useful "myths."

But there are historians within the borders of the Russian Federation who do know the history of the Golden Horde and who are not afraid to speak the truth or share it with the Europeans, and Khakimov, the longtime head of the Kazan Institute of History and former advisor to Mintimer Shaimiev, is perhaps the most eminent and outspoken.

In a commentary this past weekend for Kazan's "Business-Gazeta" in which he discussed his presentation to the Leyden conference, Khakimov says that "all of Eastern (and part of Central) Europe in one form or another depended on the Golden Horde," although few in these regions know the details.

Relations were warm: in 1272, Nogay took as his wife the Byzantine princess, Yefrosinya, and thus the third wife of khan Uzbek became the daughter of Emperor Andronik III. Given the stress Russian historians put on the marriage of Ivan III with Sofia Paleologue who supposedly brought the symbol of empire, the two-headed eagle, one should not neglect this other marriage.

"At the time of the flourishing of the Golden Horde," Khakimov continues, "Byzantium was already the 'weakened old lady,' as one of the Russian historians expressed it. The destruction of Constantinople by the Fourth Crusade in 1204 undermined the empire, and it finally fell to the Turks in 1453.

Byzantium thus could not be "a positive model" for the rising Russian state, he argues, adding that "in general, empires are not build by the emanations of spiritual forces. For their rise are needed concrete structures, experience of conducting large-scale state affairs, contemporary arms, a financial system, an economy and the ability to support a large army."

"All this" was true of the Golden Horde at that time, the Kazan historian says, and that "became the source for the construction of the Russian empire." The notion of Muscovy as the Third Rome never was "about a mechanism of the construction of the empire." Instead, it was only "about the ambitions of Russian monarchs who pretended to the inheritance of the Golden Horde in Orthodox packaging."

The Tatars "participated in all political events in the Balkans up to the 14th century," and thus played a role in the history of Bulgaria, Hungary, Serbia, Romania and Moldova. They played a no less important role in Poland and Lithuania both in terms of state-to-state relations and as the source of the Lithuanian forces who occupied Moscow in the Time of Troubles.

"Of course," Khakimov says, "the influence of the Horde on Europe was relatively brief, about 150 years long, but it was significant" and cannot be reduced to attacks or pressure given that there were clearly established borders with customs collections and the like.

All this has been obscured by the launch of the Crusades against "the agents of Satan and servants of Tartarus" and more recently by the work of "certain Russian historians" who like to view as opposites the Russians and the Tatars. That Roman paradigm allows them to view themselves as part of Europe and assign the Tatars to backward Asia.

But those who make or accept that argument should remember that "Europeans in those times considered the Russians as born Tatars, and on their maps, designated Muscovy as 'Moscow Tataria' in contrast to Novgorod Rus. In fact, the Russians are no more European than are the Tatars."

"The image of the Tatars as fiends has long been part of the sub-consciousness of Europeans," the Kazan historian says. But the Leiden meeting gives him hope because "changes in public opinion in the West always begin in the universities where scholarly studies are prepared, on which journalists and the media then rely."

"And only after several Hollywood films can one count on a change in attitude toward the Tatars," Khakimov concludes.

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 #4
Interfax
June 10, 2015
Putin: Russia has no relations with G7 but ready to cooperate with its members bilaterally

Russia currently does not maintain any relationship with the G7, Russian President Vladimir Putin said.

"We have no relations with the G7, what relations could there be?" Putin told journalists following negotiations with Italian Prime Minister Matteo Renzi on June 10.

At the same time, "if our partners want it, we will be developing active relations with any of the G7 countries on a bilateral basis," he added.

When Russia was part of the G8, it was actively involved in its work, in particular, in preparing final documents, Putin said.

"It seemed to me that this made some sense, because we at least presented some alternative standpoint. Our partners decided that they don't need this alternative standpoint. This is their decision. After all, this is not an organization but something like a club," Putin said.

At the same time, Putin said Russia wishes the G7 good luck. "I believe any contacts and any discussion should promote international relations," he said.

Italian Prime Minister Matteo Renzi said Europe needs Russia to tackle geopolitical problems.

"The international agenda is very complicated now. Russia is one of the principal participants in the process, along with Europe and America. We should give a response to international challenges, which often unite us - I am talking primarily about international terrorism," he said.

He mentioned Islamic State, al-Qaeda, and the Taliban as organizations posing an international terrorist threat.

"The intensification of fanaticism, terrorism, and religious extremism leading to the deaths of innocent people is a common theme. These events make it essential for key world powers - among them the Russian Federation, which has always been a great power and remains to be such - to have key areas of cooperation. I am sure such dialogue will be continued," Renzi said.

Vladimir Putin also said he expects that sanctions that are restricting relations between countries will be left behind with time.

"I expect that, sooner or later, we will drop the restrictions that we are dealing with today," Putin said.

The sanctions have also had a certain impact on Russian-Italian cooperation in the military-technological field, he said.

"There is not that great [a level of] cooperation there, to be frank, and it is not of some fundamental significance for Russia's defense capability. But the cancellation of some joint actions and contracts planned earlier has left Italian companies short of one billion euros. They could've received it, engaged their enterprises, and created jobs. This hasn't happened because of the sanctions," Putin said.

Russia is pursuing an import substitution program now, "and there are actually some benefits for our industry and high technology from this," he said.
"But, on the whole, this surely causes damage to our interaction," Putin added.

The Russian leader said the Italian prime minister and he had discussed the sanctions, but they did it "in kind of earthly terms - not in terms of their cancellation or reduction, but we talked about how these sanctions obstruct our relations."

Russia and Italy are pursuing several joint projects, including those related to infrastructure, and "it is absolutely obvious that Italian companies that competed for these contracts and won tenders are interested in their implementation, but they've been suspended and cannot be implemented because of the sanctions against some of our financial institutions," he said.

"It's just necessary to look for a solution - you either lift the sanctions or offer some other instruments, surely, if you want to support your companies. We'll find partners, but it seems to me that we shouldn't discard well-established instruments and mutually beneficial contracts," Putin said.

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 #5
Moscow Times
June 10, 2015
Russian Brides and the Econometrics of Love
By Oxana Filipchuk
Oxana Filipchuk is a lecturer at Plekhanov Russian University of Economics.

There is an old saying "Like must marry like or there'll be no happiness." Nevertheless, many people in Russia ignore this wisdom, especially women who look for love abroad. The "Russian bride" phenomenon didn't appear by chance but because of a basic rule of economics - demand creates supply.

For Men

Being a middle-aged, middle-income man from the United States, Canada, Europe, or even from somewhere near Europe can be enough to pass for a decent groom for a young Russian woman.

If the groom is not sure whether it's a good idea to marry a Russian woman, and not a woman from his own country, he resorts to a simple cost-benefit analysis.

Family values is one advantage of marrying a Russian woman. Any man who wants his better half to dote on him and look after the housework and their children, and not be an independent feminist type will be happy with a Russian wife.

With a Russian woman, at least, according to the dominating stereotype, a man is assured of a good wife.

Some men may be a bit embarrassed about a potential age gap between them and their spouse in their own countries. In Russia, this is not a problem. A wife who is 25 years your junior does not lead to any kind of social stigma.

Though the Russian brides market offers a good cultural mix, there will be no drastic differences between the man's life views and hers, and there's a chance she'll even speak English.

For Women

Women, naturally, seek comfort and safety.

 Sometimes a Russian woman has a foreign man fall in love with her and he then takes her to a cozy little farm in a Utah Mormon settlement to become his fifth wife. She'll get a sewing machine as a birthday present while she is waiting for her work permit, which happened to one of my acquaintances who married an American and went with him to the United States.

Or, she may be flown away to foggy Albion by a fine English gentleman whose paranoid thrift and aloofness she expected to change but gave up in despair after 15 years of marriage. This happened to another acquaintance of mine.

So where do Russian women get the idea that life in a foreign country is much better and easier than in Russia?

The answer is simple: We all remember the economic and social hardships of the 1990s when we understood that food and clothes were in abundance in the West, where a woman could buy shoes and a handbag in the same color and style as her suit or dress.

It was a powerful lesson. Though times have changed and now Russia is a consumer's paradise, this tendency is still alive, albeit in a weaker form. The thing is that the Russian brides market is huge and is constantly replenished by newcomers from poorer Russian provinces.

The fact is that both sides make economic calculations. Men do that literally, women do that in a more abstract way - in the form of a consumer dream.

Effect on the National Economy

Last year, 1,247 marriages between Russian women and foreign men were registered in Moscow alone. Turkish men are in first place - 221 marriages, Germany takes second - 161, bronze medal for Israel - 152, and the U.S. at 97 trails slightly behind Britain at 113.

On the whole, the statistics say that there has been an increase in weddings between Russian women and foreign men during the last few years, both in the capital and in the provinces.

It means that in all probability, many of those women leave Russia with their new husbands, draining the Russian workforce.

The most serious negative effect for the economy is that not only are these women leaving, but also their potential children.

This outflow of potential mothers and children leads to the further deterioration of Russia's demographic situation which is already in a precarious state.

However, the cultural exchange resulting from such marriages is good for international relations, which in turn benefits the economy.

Of course, it would be better if Russia immediately conducted economic reforms and made the country attractive not only for investors, but also for brides from developed countries.

In this case the flows of brides would balance each other. It would help the economy, demography and cultural integration in Russia.

When a woman in love plans to marry her overseas prince, she should think carefully.

She should think about possible difficulties in adapting to her new surroundings and should carefully compare the economic benefits of her decision with the strength of her feelings, and she must not rely on a chance that she will reform her chosen man, molding him into someone more preferable.

Choose the one you wouldn't like to change, because as Margaret Mitchell once said: "No wife has ever changed a husband one whit, and don't you be forgetting that."

 #6
www.opendemocracy.net
June 8, 2015
The uses and abuses of history
History is nowadays not only written by the victors, but by anybody who wants to use history for their own ends.
By Rodric Braithwaite
Rodric Braithwaite is a British diplomat and author. From 1988 to 1992, Braithwaite served as British ambassador in Moscow, and is the author of Across the Moscow River: The World Turned Upside Down, Moscow 1941: A City and Its People at War and Afgantsy.

Christopher Clark, the distinguished author of a bestselling account of the outbreak of the First World War, has come up with an ingenious explanation of why the Russians are currently behaving so badly: they are suffering from 'false memory syndrome.' In a piece which Mr Clark wrote with Kristina Spohr in the Guardian on 25 May, he picks on the way Mr Putin has justified his annexation of Crimea when the Russian President claims that the West 'has lied to us many times, made decisions behind our backs... This has happened with NATO's expansion to the east.'

But, says Mr Clark, the Russians never asked for any guarantees that NATO would not enlarge, and none were given. Putin's wayward handling of history matters, he contends, because it calls into question the European settlement, which emerged after the dramatic reunification of Germany in the autumn of 1990.

Putin is indeed rewriting history to encourage and exploit Russians' sense of humiliation and so fuel his current adventurous and aggressive policies. But Mr Clark's own account omits important facts, evades difficult issues of interpretation, and leaves unanalysed the practical and political pressures that surrounded the German negotiations and the events that followed.

Mr Clark is quite right that the Western side gave no written guarantees about NATO enlargement during the reunification negotiations. No responsible Russians have claimed otherwise. But he fails to ask why it was that no one raised the issue.

The great prize for the West was the reunification of Germany and its inclusion in NATO. But when the negotiations began in early 1990, it was not at all clear that Gorbachev would or could agree to either. His negotiating position was weak. Even if he realised that he would in the end have to concede, he also feared that domestic opposition to a deal might become overwhelming. The Western negotiators were acutely aware of that, and were anxious to nail the deal down before things fell apart in Moscow.

For either side explicitly to have raised NATO enlargement in that context could have derailed the negotiations entirely. So both sides had a motive for keeping their mouths shut: the West because they might have lost the prize, Gorbachev because he might have made his domestic position impossible. The fears were justified. Anger over Germany was one reason for the coup against Gorbachev in August 1991. And it remains one reason why many Russians now regard him as a traitor.  

The underlying emotions bubbled to the surface on the morning of the signature of the reunification treaty in Moscow in September 1990. The British were still arguing about the language governing the deployment of NATO troops to East Germany. The Soviet foreign minister Eduard Shevardnadze threatened to boycott the signature ceremony, and Genscher, his German opposite number, had a fit. It was indeed a very fraught moment, but it was successfully papered over.

But the story does not stop there. Vaclav Havel, the Czech President, then called for Czechoslovakia, Poland, and Hungary to enter NATO. In the spring of 1991, the British Prime Minister and Foreign Secretary privately assured Soviet ministers that there was no such intention. Manfred Woerner, NATO's secretary general, added publicly that enlargement would damage relations with the Soviet Union.

One can argue that Woerner was not expressing a settled NATO policy, or that what British ministers told the Russians in private didn't matter, or that oral assurances have no force, or that what was said in 1991 was overtaken by events and became irrelevant. But it is not surprising that Russians took seriously these statements by apparently responsible Western officials, or that they now believe they were misled. Mr Clark does not tackle these matters.

In early 1991 the West had not yet thought seriously about enlarging NATO. Western spokesmen were not being deliberately misleading, though there is little doubt that they would not have wanted to tie their hands, and that they would have rebuffed any Russian request for something in writing. But then their intentions changed.

The East Europeans wanted guarantees against a Russia that, they believed, would one day resume its menacing behaviour. NATO gave those guarantees in a fit of wishful thinking, apparently in the belief that Russian objections could be ignored because Russia would be flat on its back for the foreseeable future. Western politicians nevertheless tried to soothe Russian feelings with a one-sided 'partnership' with NATO, and assurances that enlargement would bring stability to Europe and thus benefit Russia too. The Russians failed to believe it. NATO is now left scurrying around to make its guarantees to the East Europeans look credible against a Russia that is indeed resurgent.

All these things are an essential and documented part of the story. They need to be brought into the historical narrative. It is a mystery why good historians ignore them.

Mr Clark argues more grandly that Putin's behaviour is all of a piece with what he sees as the Russians' unique 'tendency to misremember past debacles as humiliations', going back at least as far as their misjudged attempts to recover from the defeat they suffered at the hands of the Japanese in 1905. But there is nothing particularly unusual in this Russian behaviour. Historical memory and myth significantly affect the behaviour of other countries too: think only of France after the humiliation of 1871 or Germany after 1918.

Whether we choose to recognise it or not, many, perhaps a majority, of Russians nevertheless did feel humiliated by the collapse of the Soviet Union, the loss of international prestige, the political and economic chaos of the 1990s, and the brush with famine. Putin has plenty of promising raw material to work with. To ignore or downplay these things also distorts the historical record. And it makes it harder to understand what is going on in Russia today, and to devise appropriate policies to deal with it.

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 #7
Sputnik
June 10, 2015
Inflation Expected to Reach 11.8-11.9% in Russia for 2015

MOSCOW (Sputnik) - Inflation in Russia is expected to reach 11.8 to 11.9 percent for 2015, Kremlin Chief of Staff Sergei Ivanov said Wednesday.

"Of course, the sanctions have affected us negatively, obviously. Access to credit resources was discontinued, inflation rose, we expect it to be about 11.8, 11.9 percent by the end of the year. That is a lot, the GDP will slow down," Ivanov told reporters.

Last month, the Russian Finance Ministry said it expected the country's inflation rate for 2015 to be around 11 percent or lower.

The Russian national currency has lost half of its value since summer 2014, at its lowest point falling to 67.8 rubles to the dollar in December 2014, amid plummeting oil prices and Western sanctions.

On December 16, 2014, the Central Bank made the largest single increase in interest rates since 1998, from 10.5 to 17 percent. The institution argued that the increase would limit currency depreciation risks and and mitigate against rapid inflation.

The bank's policy has led to the ruble regaining some of its value against Western currencies and stabilizing from large value swings.

Since then, the key interest rate has been gradually decreasing. In April it was cut to 12.5 percent.

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8
Business New Europe
www.bne.eu
June 10, 2015
Pluralism - just not as we know it
By Mark Galeotti
Mark Galeotti is Professor of Global Affairs at the SPS Center for Global Affairs, New York University. He writes the blog In Moscow's Shadows.

Russia is not Mordor. Let me explain. We love to understand and explain by analogy. This can be a powerful tool, but it always carries with it the risk of caricature, oversimplification and downright misdirection. With a powerful meme that risk only grows. For a variety of reasons, today's Russia is especially prone to analysis-by-analogy, and it's a problem.

Sometimes we stick to history: Putin as the stern tsar holding his boyar aristocrats in his grasp. Sometimes it's other countries' histories. I feel there are some striking parallels between Putin's Russia and Mussolini's Italy, but to call the Kremlin "fascist" is a dangerous step, not least as "fascism" today means Auschwitz and the SS, not populist modernism.

Whether they know it or not, many of Putin's most rabid critics are actually channeling nothing less than the great British fantasy author J. R. R. Tolkien, whose epic "Lord of the Rings" strikes all the right notes for them: a Western alliance of 'Good' (admittedly made up largely of monarchs and elitists, committed to preservation of a status quo that suits them, but we won't go there for now); and the threat of fifth columnists and traitors, not least those who with silver-tongues advocate non-intervention or warn that they enemy is too powerful to challenge.

And then there is a rabid, inhuman and destructive enemy, the festering eastern land of Mordor. Its legions, stunted, ignorant and twisted, are little more than the hapless instruments of Sauron, its dark lord, who is driven by dreams of conquest and a hatred for everything his enemies hold dear. Indeed, his most terrible agents, the Ringwraiths, are literally manifestations of his will, shrieking into nothingness when Sauron perishes.

This is fanciful, of course. But nonetheless in many quarters there does seem to be a genuine belief that today's Russian state is essentially a brutal monolith, motivated by contempt for the West and its values, and rigidly controlled by a single will. This is to say the least unfortunate, as it willfully ignores the complexities to be found in Russia, and helps explain why policy has so often been flawed or truly counterproductive.

A particular issue of dispute is over just how far Putin personally runs Russia, and thus by extension orders or authorizes everything that happens. This is a complex issue, which was especially salient when people made their decisions as to how to interpret the murder of dissident politician Boris Nemtsov.

Certainly Putin remains the "decider" at the heart of the system, whose role is to resolve disputes within the elite and set broad policy. Sometimes he will also engage with detail, but to a considerable extent he appears a hands-off manager, relying on his underlings to show initiative, rewarding them when they predict his intentions and perform as desired, punishing them when they don't.

Pluralism, Putin-style

That does mean that there is considerable scope for initiative, even autonomy within the elite. As a result, modern Russian politics is best explained precisely by its diversities and pluralities.

Consider, for example, the so-called siloviki, members, veterans and fellow travelers of the security apparatus. In the 1990s, a time when institutions were dangerously weak and collectives necessary to exploit the extraordinary opportunities available, it made sense for such coalitions of interest to form. But today? There seems no evidence of any unity. Igor Sechin, head of Rosneft, is often described as the leading siloviki, not least because of his presumed (and probable) background in the GRU. However, he now seems wholly invested in his role as a hydrocarbons baron, rarely speaking on issues outside that realm, and few siloviki with whom I've spoken to ever seem to have any great regard for him.

Likewise, although these people share some broad values, from Russian nationalism to mistrust of the West (and my experience of British and US siloviki is that they too tend towards a certain commonality of values and beliefs), their practical interests often clash or else drive them into alliances with people in other, notionally rival groups. The armed forces get shafted by the military-industrial complex, forced to buy tanks they don't need. The Federal Security Service leans on the Ministry of Internal Affairs, even while elements within each do business together.

Premiership Games

So there are all kinds of factions, fractions and friendships slicing and dicing the Russian elite, cutting across as well as along institutional and functional divides. This is visible in the long-running, if largely behind-the-scenes, competition for the prime ministerial chair. Dmitry Medvedev wants to hold on to it. Others want it, including three contenders generally considered all to be on the liberal marketeer/moderate reformist wing: Sberbank's president German Gref, First Vice President Igor Shuvalov, and probably also former finance minister Alexei Kudrin.

Two things emerge from their ponderous maneuvers. The first is that their power bases are often disparate. Shuvalov, for example, has been wooing the nationalists. At Davos, he turned to unusually hardline rhetoric, saying that Russians would "survive any hardship in the country - eat less food, use less electricity" rather than give in to Western pressure. Coming from one of Russia's richest men, this aroused some scorn on social media, but earned him points even with hawks such as Deputy Premier Dmitry Rogozin.

Likewise, Gref has won plaudits from within the intelligence and security community with his claim that the December 2014 ruble crash - and the record-breaking run on Sberbank that saw $6bn withdrawn in one day - was a deliberate act of economic warfare coordinated from abroad, whose "target was to destabilize the country's largest bank and the financial situation in the country". Federal Security Service director Alexander Bortnikov liked that take on events.

The thing is that these are not simply contests driven by self-interest, factional politics or social ties. They also reflect genuine differences of opinion. The policy debate in Russia is certainly less raucous and inclusive than in the democratic West, and aimed at influencing Putin the "decider", but it nonetheless exists.

There are disagreements over economic policy, of course. Kudrin, for example, is not just confining himself to grumbling about the squandering of past opportunities (though he does enough of that). Warning that Russia faces "a full-blown crisis under any existing criteria", he is not only setting himself against populist policies that impede growth, he advocates greater institutional reform and, implicitly, more emphasis on anti-corruption measures.

However, Gref is also quietly articulating a modernizing political-economic policy platform of his own. Advocating "serious reforms of all relations in the economy", Gref is trying to stake out a Kudrin-lite position: "We can start with the system of executive power. There is no need to touch the constitutional foundations - there is more than enough scope for activity in the sphere of reforming the executive hierarchy." To this end, he wants to see some kind of strategic agency to ensure performance and delivery across the government.

Beyond that, though, there are disagreements across the elites in every sphere. Disagreements over legal policy often splash into disagreements over history, especially the place of Stalin. In April, for example, moves to rehabilitate Genrikh Yagoda, one of Stalin's secret police chiefs, were struck down in the Supreme Court. Legal issues also cut to the heart of the relationship between Moscow and the regions. For example, disagreements over Chechnya's de facto legalization of polygamy really are coded ways to discuss how far Chechen warlord-President Ramzan Kadyrov should be given free rein. This is one of those policy issues in which the liberals and the security apparatus are in ironic alliance, the former horrified by Kadyrov's arbitrary brutality, the latter smarting at the way he took over all local security agencies.

There are debates over the social and economic implications of relying on Central Asian migrant labourers, over cultural policy, over health reform, over education. There are even, albeit much more cautiously and quietly, disagreements over Russia's current geopolitical strategy of tension.

In other words, while obviously Russia is no representative democracy, and there are no meaningful constitutional constraints on Putin's authority, that does not mean that this is totalitarianism. Sometimes behind closed doors, sometimes in Aesopian metaphor, and sometimes openly, the elites - and even in some limited ways civil society and public - opinion continue to engage, debate and shape the political environment. That is, after all, how humans are. Only in fantasy can politics be simplified to the will of a single dark lord.


 

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#9
Bloomberg
June 9, 2015
Putin Is No James Bond Villain
By Leonid Bershidsky

Despite spending hundreds of millions of dollars on foreign-language propaganda, all that President Vladimir Putin has achieved outside Russia is the status of a Bond movie villain. He may enjoy it, especially since there's no 007 in sight to tackle him, but his variety of pop stardom is growing into a problem for his country: He is seen as a bigger threat to the West than his actions warrant.

A fresh survey of European and U.S. politicians and policy wonks by the website Politico revealed that Putin is seen as by far the biggest threat facing Europe and its relationship with the U.S.:

Brexit? Grexit? Economic problems? A million migrants waiting in Libya to cross the Mediterranean into Europe, or the extremist parties that would have these migrants drown rather than resettled? Are these threats really less deadly than one rather short Russian man?

"Putin has achieved a pop-culture-fueled notoriety rarely bestowed upon world leaders," McKay Coppins wrote in a BuzzFeed article on Jeb Bush's upcoming European tour. The yet-undeclared Republican presidential candidate is expected to attack Putin at each stop, including Poland, where the newly elected President Andrzej Duda campaigned on taking a tougher stand against Putin's aggression. Bush will also speak in Estonia, where President Toomas Hendrik Ilves accuses Putin of destroying the post-World War II order in Europe.

Duda's anti-Putin rhetoric needed to be tougher than the incumbent Bronislaw Komorowski's to win. In the same way, Bush's rhetoric must be a few degrees hotter than that of President Barack Obama. That isn't easy. On Monday, Obama used his public appearance at the end of the Group of 7 summit in Germany to hammer the Russian president. "Does he continue to wreck his country's economy and continue Russia's isolation in pursuit of a wrong-headed desire to re-create the glories of the Soviet empire?" he asked.

A preoccupation with Putin at this level is far more serious than the Bond villain listicles that have been made about Putin for years. If policy makers and pundits see Putin as a major, even dominant threat, countering that threat will become a policy priority.

So far, rearmament in response to Russian aggression in Ukraine has been largely limited to Russia's neighbors in Eastern Europe. Still, North Atlantic Treaty Organization officials are playing up the Russian threat, which has breathed new life into a declining organization. Doing business with Russia is politically unpopular, so the damage to Western trade with Putin's country is likely to go beyond the Ukraine-related sanctions that will probably get extended later this month.

The perception of the threat Putin poses, and the rhetoric of response to it have outgrown the the threat itself. Taken much further, that response could even feed Putin's paranoia about the threat the West poses to his regime and Russia more broadly, that it becomes a self-fulfilling prophecy.

Since the Minsk cease-fire in eastern Ukraine came into effect in February, Russia has not used its regular troops to gain more territory, although the feisty Ukrainian government has provided potential excuses for action. The government in Kiev has imposed a de-facto economic blockade on the rebel-held regions, making it difficult for goods and people to move across the contact line. It has been in no hurry to make the legislative changes required by the Minsk deal to give more autonomy to the eastern regions.

Instead of steamrolling the still-weak, underequipped and undertrained Ukrainian military, Putin has been giving it time to recover from previous defeats. Last month, the pro-Kremlin site Gazeta.ru announced that "Project Novorossiya" -- the idea that the two rebel "people's republics" in eastern Ukraine would unite to form a pro-Russian unrecognized state -- had been shelved, and that the Russia-based unofficial support structures for the project had been disbanded.

In recent days, the rebels tried to grab the village of Maryinka from the Ukrainian forces, but were pushed back and apparently denied the kind of Russian support that allowed them to claw back a lot of lost territory a year ago and then win the crucial railroad junction of Debaltsevo in February.

None of this looks as though Putin is "re-creating the glories of the Soviet empire." There is no question he pines for those glory days, but, were he a bona fide Bond villain, he'd try a lot harder to obliterate Ukraine's pro-Western government. As it is, he seems intent on a negotiated solution, even though he is trying to drive a hard bargain. This behavior is not consistent with plans to invade Estonia or Poland and not compatible with presenting the biggest threat to European order.

Putin is a rogue dictator and respects nobody's rights but his own. That doesn't, however, mean that he is intent on destroying the world with nuclear weapons unless it bends to his will, or on launching a Hitleresque blitzkrieg in Europe. He will make trouble for the EU, NATO and the U.S., but he is careful not to unduly endanger the grip that he and his billionaire friends have on Russia. Adventures in the style of Auric Goldfinger, or Ernst Stavro Blofeld, would be too risky for the real life Putin.

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#10
Russia Beyond the Headlines
www.rbth.ru
June 10, 2015
Russia's image problem puts a damper on international tourism
The fall of the ruble at the end of 2014 made travel to Russia cheaper than ever, but not many Western tourists are willing to make the trip.
Alexander Bratersky, special to RBTH  

In a January article on CNN.com, travel reporter Laura Powell asked "Is now the time to visit Russia?" At the time, the question seemed absurd. Relations between Russia and most of the West, including the United States, are at post-Cold War lows and fighting was raging in eastern Ukraine. Over the past few months, however, the idea of Russia as a tourist destination has gained more traction - partially because of the decline in the value of the ruble against western currencies.

Data from Russia's Federal Agency for Tourism (Rosturism), confirmed that there was an increase in the number of tourists visiting Russia in December, just after the value of the ruble fell sharply. However, that was not enough to improve the overall numbers for the year. Overall in 2014, the number of tourists to Russia declined by 3 percent. Nevertheless, the trend that began in December 2014 has continued this year. Since the beginning of 2015, tourism into Russia has increased by between 3 and 5 percent, according to a recent interview Rostourism deputy chairman Nikolai Korolev gave to news agency TASS.

It isn't Western tourists who are gradually making their way back to Russia, however. In the first quarter of 2015, tourism from China increased by 10 percent. While most tourists come to Moscow, the number of Chinese visitors to Siberia has also increased, according to Anatoly Kazakevich, the director of the travel agency Baikal, which focuses on trips to the famous lake.

"This is due to the currency exchange rate and the strengthening of international relations with Asia," Kazakevich said.

Over the past year, Russia's economic and political strategies have focused on the "pivot to Asia," with major deals being signed between Gazprom and China's national energy firm CNPC. Russian President Vladimir Putin also made a state visit to China last year.

Traditionally, Germany led the ranking of countries sending tourists to Russia. In 2013, about 380,000 Germans made the trip. But in 2014, only 350,000 Germans came to Russia, while the number of Chinese increased to 410,000 - up from 372,000 in 2013.

The number of American tourists also declined in 2014 to 162,000, down from 197,000 the year before, according to statistics from Rostourism.
 
The value of a weak ruble

Vladimir Kantorovich, a member of the presidium of the Association of Tour Operators of Russia (ATOR), said that right now the weak ruble is the only trump card in Russian tourism, and that advantage, is offset by the overall negative attitude of the EU and the United States toward Russia.

"Clearly, it is not directly related to tourism, but tourists want to travel to those countries that have good relations with theirs," Kantorovich said.

Tour operators agree with this statement: "Unfortunately, the depreciation of the ruble coincided with the deterioration of the image of Russia in the foreign market, therefore, the country failed to become more attractive to many foreign tourists," said Alexander Lanskaya, executive director of Patriarshy Dom Tours, a travel agency specializing in sightseeing tours of Moscow, St. Petersburg and other Russian cities for foreign tourists.
 
Signs of improvement?

The recent downturn in tourism has only reinforced the recognition that despite its rich cultural heritage, Russia needs to promote itself better as a tourist destination. This year, Rostourism opened its first offices abroad, beginning with an office in Dubai in May. By September, the agency plans to have outlets in Finland, Germany, China and Italy.

Other government agencies are also working to improve Russia's attractiveness for tourists. English signs and maps were introduced in the Moscow Metro last year, and in July 2014, Russia's Interior Ministry created a division of police to help tourists.

However, ATOT's Kantorovich noted that tourists still complain that metro workers and other municipal staff don't speak English. And the tourist police have had a hard time recruiting qualified personnel.

Nevertheless, the initiatives may be paying off. In early May, Russia rose by 18 points from 63th to 45th place in the prestigious international Travel & Tourism Competitiveness Report rankings, prepared by the World Economic Forum and Strategy Partners Group.

Russia received high marks for cultural attractions, but low scores the difficulty of obtaining visas.

Getting a Russian visa is associated with a high degree of bureaucracy, says the ATOR's Kantorovich, who believes that Russia could make concessions there: "No one prevents us from taking this step unilaterally and abolish visas," Kantorovich said, citing the example of mutual abolition of visas with Israel. After the move, the flow of Israeli tourists to Russia increased by 50 percent.

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 #11
Interfax
May 15, 2015
Russians think their country is most hospitable, foreigners disagree

Russians think their country is the world most hospitable, but foreigners maintain an opposite viewpoint, according to a survey conducted in 15 states by use of the Momondo meta-search engine.

Thirty-eight percent of polled Russians said their country welcomed foreigners in a best possible way. They gave second place to Turkey (18 percent) and third place to Italy and Spain (16 percent). In the opinion of Russians, the least hospitable countries are Denmark and the Netherlands (2 percent for each).

In turn, residents of other countries mentioned Russia amongst the least hospitable countries. It gained the highest score of 9 percent only in Turkey and China. Russia as a hospitable country gained 4 percent support in Germany, 2 percent in Italy, Norway, Spain and Sweden, and 1 percent in Denmark, Finland, France, the Netherlands, Portugal, the United Kingdom and the United States.

"A possible reason for the low opinion on hospitality of our country is that few foreign tourists have ever been to Russia, particularly because of tough visa requirements and high prices. But the popularity of Russia in foreign countries has been steadily growing. Geopolitical complications significantly cut tourist arrivals from Europe in 2015 but the number visits paid by residents of China, Turkey and Armenia has grown," Irina Ryabovol, Momondo representative to Russia, has said.

The hospitality rating was topped by Spain, Italy and the United States. Russia was closer to the bottom but not at the bottom - last place was given to Finland.

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 #12
Reuters
June 10, 2015
U.S. Wants Pope to Condemn Russia's Ukraine Policy at Meeting With Putin

ROME - The United States urged the Vatican on Wednesday to criticize Russia's involvement in the Ukraine conflict more forcefully, hours before Pope Francis was due to meet Russian President Vladimir Putin.

"It does seem that Russia is supporting the insurgents and does seem that there are Russian troops inside Ukraine," said Ken Hackett, the U.S. ambassador to the Vatican.

"Maybe this is an opportunity where the Holy Father can privately raise concerns. Certainly Pope Francis has been told about the situations that are happening in eastern Ukraine ... so is he is not unaware," Hackett said.

Last February, when the pope referred to the conflict in the Ukraine as a "war between Christians" without criticizing Moscow, the Russian Orthodox Church praised it as a balanced approach.

But the Vatican had to issue a clarification after one Ukrainian Catholic bishop called the pope's words "particularly painful" for all Ukrainians.

Western countries, Kiev and NATO have all presented what they say is evidence that Russia is sending troops and weapons to rebels in eastern Ukraine, although Moscow vigorously denies this.

Putin has expressed concern about the fate of Christians in the Middle East, particularly in Syria, and this is also expected to be a topic of discussion in his meeting with Francis, their second since Francis' election.

"I'd like to see if he [Putin)] has a proposal [about protecting Christians]. That would be very useful," said Hackett, who spoke during a briefing on a new accord on the exchange of financial information between the Washington and the Vatican.

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 #13
CNBC.com
June 9, 2015
Russia: Time to invest despite sanctions threat?
By Holly Ellyatt

Despite the potential for more international sanctions on Russia, some investors and market analysts have argued there is value to be found in the country - but only for those prepared to handle the volatility.

Sanctions on Russia, which were imposed by the West after the country's annexation of Crimea and role in the conflict in east Ukraine last year, could soon be extended, U.S. Treasury Secretary Jack Lew said Tuesday.

It comes as a ceasefire between the two countries -- known as the Minsk agreement -- looks shaky, with an uptick in violence in the region over recent weeks between the Ukraine military and pro-Russian rebels.

Should sanctions be extended further, Russia's economy could be in for a repeat of 2014's rollercoaster ride, when its currency and stocks were hit hard by declining oil prices, capital outflows and soaring inflation.

Potential and pitfalls

Despite this uncertainty, however, some market participants argued there were "bargains" in Russia.
"There is significant opportunity here. The one thing with Russia is that it generally goes from being the worst (performing) stock market to the first stock market in a very rapid rate," Simon Fentham-Fletcher, chief information officer of Freedom Asset Management, told CNBC Europe's "Squawk Box" Wednesday. His company specializes in investment in emerging markets, such as Russia.

Certain sectors - such as retail and real estate - were thriving, Fentham-Fletcher said, speaking from Moscow.

However, he did say the ruble could see further deterioration after a brief recovery against the dollar of late. It is currently trading around 55 to the dollar -- a far cry from its weakest point in January this year, when it traded around 70 to the greenback.

"We've had a lot of the ruble being propped up by many quasi-state companies exchanging dollars for rubles, but I think that will slow down now," Fentham-Fletcher added. "Before, there was panic on the streets here with people queuing up at kiosks to change money, but that's declined and generally, Russia feels comfortable now."

This sanguine approach to sanctions by many Russian citizens is due in no small part to the Russian government's attempts to turn the crisis into an opportunity -- using it to promote patriotic values, goods and services.

The Russian economy ministry now expects gross domestic product (GDP) to shrink by 2.8 percent in 2015 -- a smaller contraction than initially forecast - and the World Bank earlier this month also raised its growth forecasts for the country.

Buyer beware

Senior Market Analyst Craig Erlam, from currency trading firm OANDA, told CNBC that "the argument against investing in Russia is becoming increasingly difficult as the country does appear to be stabilising."
But he did stress there was plenty of risk involved.

"Inflation has probably peaked and is on the decline, oil prices have bottomed and rebounded strongly from those lows and fighting in Ukraine has eased, although flare ups do continue to happen," he said via email Wednesday.

"However, that does not mean that investing in Russia doesn't still pose a large risk and things can still take a turn for the worse."

He said that - at the very least - sanctions were likely to remain in place, meaning that Russia's economy would continue to suffer.

"With this being the case and the risk of further sanctions being imposed, I still see plenty of risk in Russia," Erlam added. "Until the rhetoric changes from increasing sanctions to possibly easing them, I don't see a huge amount of upside potential."

Lew told Ukrainian leaders on Tuesday that the U.S. and its Group of Seven (G-7) allies were ready to impose more sanctions on Moscow, an unnamed Treasury official said, according to Reuters.

By Russia's own admission, the ceasefire with Ukraine is not holding well, with the Russia's Foreign Ministry saying in a statement Tuesday that "the process of implementation of Minsk agreements is largely still fragile."

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#14
Wall Street Journal
June 10, 2015
Expats Leave Moscow Amid Russia's Economic Downturn and Ukraine Crisis   
By THOMAS GROVE
Thomas Grove, a U.S. citizen, is a reporter for The Wall Street Journal in Moscow. He has worked in Russia, Ukraine and Turkey.

MOSCOW - Outside the gated community that passes for American-style suburbia only miles away from the Kremlin, Moscow's Little League has a problem. The number of players is down by half since last year and there aren't enough teams to hold playoffs.

For years, Moscow's Little Leaguers had eight teams, separated into two divisions.

"This year, there were so few players we had to lump them together to just get four teams," said Steve Wolf, 46, a teacher at the nearby Anglo-American School of Moscow.

"We think it's because of the sanctions. There just aren't as many parents around," said Mr. Wolf, watching his son, Luke, pitch.

A year after U.S. and European Union sanctions were imposed on Russia for the Ukraine crisis and the country descended into a steep economic downturn, many Western companies have pulled foreign staff out of Russia, turning what was once a thriving expat community into a shadow of its former self.

Unlike the crises of the past, in 1998 and 2008, this economic downturn has been exacerbated for foreign companies and entrepreneurs by the Kremlin's strident anti-Westernism. The government of Vladimir Putin has placed some of the biggest multinational companies in its crosshairs, with health officials temporarily closing several McDonald's Corp. restaurants and the Agriculture Ministry singling out PepsiCo Inc. and Danone SA for checks.

With Western expats taking leave of Russia, airlines are scaling back flights. Delta Air Lines Inc. plans to suspend flights from New York to Moscow this coming winter. Austrian Airlines, a unit of Deutsche Lufthansa AG, and CSA Czech Airlines have cut flights to regional destinations within Russia. EasyJet PLC has suspended or trimmed various flights from Great Britain to Moscow.

"This year we've been going to a lot of going away parties," said Bernard Sucher, who has lived in Russia for 22 years and serves on the board of UFG Asset Management. "In the 2008 crisis, everyone dug in, expecting to be rewarded by a rebound. This time around people don't like the way the country is headed and entrepreneurs here are worried about their bottom line."

An international law firm that deals with global corporate immigration said the number of expatriates applying for new work permits fell by 22% over the 2013-14 period. At the same time, those who are already here are leaving, including heads of businesses whose profits are dwindling, and employees on expat packages being uprooted by companies that are cutting back in Russia. Data from Russia's Federal Migration Service showed the number of foreigners in Russia from the U.S. and Western Europe's biggest countries was down 34% in the first month of this year compared with January 2014. In January 2014, the community of foreigners from North America and Western Europe numbered 1,137,000. A year later, it had dwindled to 746,580.

The oil and natural gas sectors had the greatest outflow of foreign workers after U.S. and EU sanctions on Russia's hydrocarbons sectors cut cooperation, according to people in expatriate relocation services. Eyes are on the retail and automotive sectors for possible expat-staff cutbacks after Russia's economy fell 2% in the first quarter. General Motors announced plans earlier this year to suspend its St. Petersburg factory and stop sales of its Opel brand and most Chevrolet models.

The departures of affluent expat professionals have caused property prices in some of Moscow's prime locations to plummet by as much as 40%, said David Gilmartin of Troika Relocations. "Prices are falling because there are a lot of empty apartments. There's just no demand," he said.

During Mr. Putin's first two terms as president from 2000 until 2008, the Russian economy grew by an average of 7% a year, and as foreign investment poured in, so did foreign expertise and personnel. The salaries as well as the lifestyles were often larger-than-life in a city with no shortage of champagne and caviar for a well-heeled crowd living on generous expatriate packages. Mr. Putin's successor Dmitry Medvedev accelerated efforts to court Western firms, putting in place legal changes that made it easier for companies to bring in foreign specialists.

By 2013, demand for corporate visas to Russia was so strong that New Jersey native Garrett Papas was ready to make good on plans to acquire a local law firm for his employer, one of the world's top corporate immigration law firms, that would provide a permanent office in Moscow. But by the end of last year, the stream of expats coming to Russia was at a trickle, putting acquisition plans on hold and forcing him to buy a ticket back home.

"From one year to the next we were all-systems-go to on-hold permanently because of Ukraine, sanctions and the investment climate," said Mr. Papas.

The departure of Western expats means more international corporate units are being led by Russians, according to corporate insiders. At the same time, the number of Chinese living in Russia has surged, a reflection of Moscow's pivot to China for economic and diplomatic support in the face of sanctions. Migration statistics show a 40% increase in the number of Chinese living in Russia from January 2014 to January 2015. Many have bought property in Moscow as well as in Siberia and Russia's Far East.

At the baseball diamond, George Crouse, 50, sat with his wife near the hot-dog stand as his two girls played nearby.

"There's a lot of people going home and just not being replaced," said Mr. Crouse, who works at a big four consulting firm

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 #15
Business New Europe
www.bne.eu
June 9, 2015
World's economic centre of gravity continues shift east
Ben Aris in Moscow
[Charts here http://www.bne.eu/content/story/bnechart-worlds-economic-centre-gravity-continues-shift-east]
 
The leaders of the G7 industrialised nations met in Berlin on June 7, but their decisions are becoming less and less relevant to the rest of the world as the centre of global economic gravity moves relentlessly east.

In 1990, the centre of the world's economic gravity - the sum of the wealth of every country weighed against each other and fixed to the geographic centre of each country - was located on the eastern seaboard of the US. Formerly the planet's economic powerhouse, America's economic might has waned in proportion to the rise of the emerging markets in the last two decades. Thus the centre of gravity has been moving eastwards.

There was a spurt between 2005 and 2010, the boom years of Russia and China's economic transformation, before this trend slowed as the aftereffects of the 2008 global crisis hit emerging markets hard. As of today, the economic centre of gravity is to be found in the Mediterranean, according to a report released by Wealth-X, a research house that specialises in intelligence and marketing to the world's rich.

"In just the past 20 years, the number of high net worth (HNW) and ultra high net worth (UHNW) individuals globally has more than trebled," Marc Cohen, the author of the report and regional managing director for Europe for Wealth-X, wrote. "The past decade has seen a HNW wealth growth trend of over 7% per year. The trend also applies to the world's UHNW population (those with net worth over US$30 million), who now account for .004% of the world's adult population, and whose wealth has grown at 6.6% per year from 1992 to 2012.

The shift in wealth eastward is driven by the fact that many of these new super-wealthy are from emerging markets. Russia tops the world in terms of the likelihood of becoming a billionaire, with one person out of every million enjoying a 50/50 chance of becoming a billionaire in the last 20 years compared with zero chance in Germany, as it has not produced a new billionaire in two decades.

Emerging markets are the biggest new variable, says the report, but "increased entrepreneurship and business ownership, the rise of new technology and globalisation, as well as the democratisation and modernisation of wealth and power away from inheritance and 'old money' has also made a big difference," Cohen adds.

The path traced out by the centre of gravity of wealth in the last two decades was moving from New York, the home to the richest of the rich in the 1990s, towards London, the new playground of the super-wealthy in the noughties. However, more recently the path has veered southwards as the wealthy in Southeast Asia, South America and Africa have started to count; the cities of Singapore, Hong Kong and even Dubai act on the centre of gravity like magnets.

"As North American fortunes declined, the centre of gravity began moving at around 10 times its historic speed. By 2010, the global centre of gravity of wealth was in the western Mediterranean. Since the crisis, the pace of movement has inevitably slowed. But it continues to move east, and slightly southerly, reflecting the continued rise of wealth in South East Asia and increasingly in South America and Africa," the report says. "Today, the centre of gravity is in the central Mediterranean, between the toe of Italy and coast of Tunisia."

As demonstrated by the centre of gravity, the wealthy today are spread equally across North America, Europe and Asia (approximately 30-35% in each). In terms of countries, the US remains the largest single country for millionaires, with just over 6mn millionaires, of which 69,000 are UHWN. But the distribution of wealth is much more evenly spread than it was two decades ago, with about 30-35% of the global rich living in each of North America, Europe and Asia.

China leads amongst the emerging markets in terms of the number of millionaires (third overall), and it is well ahead in terms of the rate that it is adding new millionaires. Russia is next among the leading emerging markets in terms of the number of millionaires (13th), and trails only China and Brazil in terms of the pace of adding new ones; the number of rich tripled in Russia and Brazil over the last two decades and quintupled in China over the same period.

And the shift to the east of the global centre of economic gravity has been tracked by geopolitics. The G7 summit just held used to be called the meeting of the World's "rich nations". But in 2014 emerging markets became worth more than the developed world in terms of their share of Global GDP, according to Jan Dehn, head of research for Ashmore Investment Management citing the International Monetary Fund (IMF) data. According to the IMF's April 2014 "World Economic Outlook" analysis, the emerging market's share of global GDP hit 50.4% in 2013, up from 31% in 1980.

In response to Russia's showdown with the EU and US over Ukraine's future, the Kremlin has accelerated its "pivot to the east" and the BRIC acronym that started life as an investment bank marketing strategy has transformed into a political reality in the last decade.

As the G7 leaders sat down to discuss global affairs in Germany, the Russian Duma's chairman of the International Affairs Committee, Alexey Pushkov, boasted that Russia's BRICS presidency (South Africa has been added) shows the failure of plans to isolate Russia and added, somewhat implausibly at least in the short term, that the BRICS nations joint GDP will soon overtake those of the combined G7 countries. "The West was very sceptical about BRICS. Sceptics are now confounded. BRICS will soon surpass G7 in terms of GDP," Pushkov wrote on Twitter.

The point has not been lost on Western political commentators. As the G7 meeting got underway, Ian Bremmer, president and founder of Eurasia Group, tweeted this map with the comment: "The World is isolating Russia. As long as the World looks like this."

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 #16
Moskovskiy Komsomolets
June 2, 2015
Expert views Islamic State threat to Russia
Renat Abdullin, What threat does Islamic State pose to Russia?

Director of the Institute of Oriental Studies at the Russian Academy of Sciences Vitaliy Naumkin: "According to official estimates, 1,700 people from Russia are fighting on the side of the Islamic State. Many experts put this figure even higher."

The Islamic State terrorist group remains one of the biggest threats globally. The participation of foreigners (including from Russia and the CIS) in the group's operations is a major concern, because it shows that the extremists' influence spreads far beyond Iraq and Syria. Reports about a former commander of Tajikistan's OMON unit, who joined the Islamic State, testify to that influence. Vitaliy Naumkin, director of the Institute of Oriental Studies at the Russian Academy of Sciences, spoke at a news conference at the newspaper Moskovskiy Komsomolets office on 1 June about the group's strategy, in which recruitment of foreigners plays an important role, and about the threat which this phenomenon poses to Russia.

About jihadists from Russia and CIS countries: "According to official estimates published by organizations which study this issue, 1,700 Russian citizens are fighting on the side of the Islamic State. Many experts put this figure even higher. The International Crisis Group has information that another 4,000 people are there from the Central Asian countries. For obvious reasons, the figures provided by the governments of those countries are lower. In any case, these are large numbers, on the par with the numbers from the region where Tunis leads providing the highest numbers of fighters. It is noteworthy that most Russian natives [fighting for the Islamic State] represent the diaspora, that is, they do not arrive there from Moscow, Tatarstan or the North Caucasus, although this happens too... Of all Chechen communities in Europe, Austria leads in terms of providing one of the largest groups of cruel and experienced fighters, who moved there from Chechnya before joining the Islamic State in Iraq and Syria. This is a disturbing factor, and not only because of the numbers but because of the absence of a comprehensive strategy to prevent such processes both at the point of "exit" and at the point of "entry."

About countermeasures: "It is necessary to take measures to prevent the indoctrination of such people and their travel abroad, although it is difficult to do because everybody is free to leave Russia. You can travel to Turkey, take a bus there and arrive in Syria. Unless you have been traced down to the point of exit and arrested there, and there is evidence that your intention is not to swim in the sea but to kill people. But we must also do something at the point of "entry," when people return having fought there and having got used to killing people. What do we do with them? Some of those people can repent, but will they change after serving a prison sentence? After all, it is quite possible that this prisoner will "recruit" even more people to the ranks of jihadists. Therefore, we are talking about the need for a comprehensive strategy, which would cover everything - from addressing the social and economic conditions of these people to preventing indoctrination through the internet or other channels. This is a whole chain, not just one person who arrives somewhere and recruits others to join the Islamic State."

About motivation: "Money is not always the main motivating factor - there have been cases when successful and wealthy people sold their property and went to fight. And not always to fight - some people just want to live in such a state. The threat is that the Islamic State represents a certain model whose attraction we have not assessed yet. Another threat is that our argumentation framework against the Islamic State is sometimes weak, including that of our clergy. And we cannot blame people for this. This is also true for scientists and experts: there are a lot of people these days who say the wrong things and thus indirectly push people, unhappy about the things they say, into the arms of the Islamic State recruiters."

About the Islamic State strategy and its cooperation with other groups: "The Islamic State strategy covers many areas. On the one hand, we see a kind of franchise, when some radical groups scattered around the world declare that they join the Islamic State, in whole or in part. But there is no formal unification. For example, the Islamic Movement of Uzbekistan (which announced that it was joining the Islamic State) has its main base in Pakistan and Afghanistan. They are hoping for a change of regime in Afghanistan and invasion of Central Asia, and their main targets are Tajikistan, Uzbekistan and Kyrgyzstan. They want to establish their Islamic state there. Of course, they do subscribe to the caliphate theory but there are many such theories. So we see a certain franchise here, where groups declare support for the Islamic State, but continue to act independently. But, on the other hand, in the worst-case scenario, if the Islamic State spills beyond the territory it now controls in Iraq and Syria, they may merge into one organization controlled from a single centre. This is not the case right now. There may be some degree of coordination or maybe none at all. But the very fact of loyalty, the existence of active or dormant cells - all that is obviously part of the Islamic State strategy. They create them, give them assistance and help attract more supporters, because the Islamic State has already become a kind of fashionable brand in this field."

About rivalry between the Islamic State and other groups: "The Islamic State is competing with the Al-Nusrah Front operating in Syria and affiliated with Al-Qa'idah. Their rivalry is so fierce that it comes to merciless war in some places."

About US air strikes: "It is impossible to defeat the Islamic State with those air strikes, but the United States understand that anti-American sentiments in the region are at the boiling point, and they do not want unnecessary casualties among the civilian population which would reinforce those sentiments. Therefore, the limited nature of the US action, which is often criticized in Russia, is not because the Americans support the Islamic State or do not want to destroy it. They do want to destroy it, they do not need it. But they are acting carefully. They have few allies, and nobody wants to fight on the ground. However, even their pinpoint air strikes have been quite effective. According to experts familiar with the situation, these attacks have helped cut the smuggling of oil from Syria and, accordingly, the revenue that the Islamic State receives from it by two-thirds."

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#17
Russia Beyond the Headlines/Kommersant
June 9, 2015
Could Islamic extremism prompt Russia and the U.S. to closer cooperation?
With the rise of Islamic militant fundamentalism in the Middle East creating increasing challenges to regional and global security, both Russia and the U.S. are faced with serious risks to their interests in the region. Historian Vitaly Naumkin argues that despite tense relations in other foreign policy spheres, the two nations have good reason to join forces in the region.
By Vitaly Naumkin, Kommersant  
Vitaly Naumkin is the director of the Institute of Oriental Studies of the Russian Academy of Sciences and a doctor of historical sciences.

The rapid advance of radical Islamist terrorist groups, representing a threat both for Russia and the United States, is one of the dominant trends in the Middle East at the moment.

Moscow and Washington have mostly asymmetrical interests in the region. The U.S., not to mention its allies, still remains a major buyer of Middle Eastern oil; a number of states in the region are strategic partners of the United States, having signed bilateral security and defense treaties, so there are American military bases there. Russia has none of these.
 
Shared interests present opportunities

On the other hand, Moscow cooperates both with countries that have a difficult relationship with the U.S. and with some of its partners, like Turkey. On the whole, Moscow arguably does not have any vital interests in the Middle East. Accordingly, Russia and the United States do not have any serious contradictions there, even if their administrations have different takes on certain regimes and events. Hypothetically, this could create an opportunity for both countries to cooperate in the areas where they have common interests.

But what are those common interests? First and foremost, there is of course the need to fight against international terrorism and extremism. Russia and the United States both want stability in the Middle East. Even if Washington, as many believe in Russia, has actually been seeking to create "controlled chaos" in the region, I do not think this would correspond to the long-term interests of the U.S. Regime change in the countries that are hostile to (or not controlled by) Washington, would create problems for the United States, rather than advantages. When will Libya be controllable and who will control it? Not the U.S. It is no coincidence that realist American politicians, like Henry Kissinger to name but one, have criticized the country's reckless intervention in the affairs of the regional states. But could Russia and the U.S. cooperate today to, for instance, restore stability in Libya?
 
Barriers to collaboration

However, U.S.-Russia cooperation, even in the areas of common interests, is affected by a number of constraints. The main one is the deplorable state of bilateral relations and the resulting deep mistrust between the two governments. Even once the Ukrainian crisis is settled, the situation is unlikely to change significantly. On one hand, the United States supports several Islamist groups considered "moderate" in some Arab world countries that suffer from terrorism. In turn, Russia believes these groups are almost as dangerous as the al-Nusra Front, the al-Qaeda branch operating in Syria and Lebanon.

Terrorists must not be divided into "good" and "bad." On the other hand, Washington refuses to cooperate with the Syrian government, regarded by Moscow as an important partner in the fight against terrorism.

Even if we assume the counter-terrorism cooperation between the two countries would be advanced to a level corresponding to the threat, Russia will not be ready to join any coalition led by the United States, and the U.S. will never refuse to be the leader. Russia, which learned some valuable lessons from America's (and its own) experience, would under no circumstances conduct military operations in the Arab countries, or even conduct airstrikes there. Moscow will in any case insist on submitting the issue to the UN Security Council (where it wields a veto - RBTH).
 
Low profile?

Nevertheless, Russia is willing to cooperate both with the West and with regional states in the fight against terrorism, preferring to work with legitimate governments. Moscow is especially concerned about the growing numbers of jihadists from Russia and Central Asia fighting for ISIS (Islamic State).

I think the need to stand together against a common threat will eventually prompt Washington and Moscow to make amends. But considering all the above-mentioned constraints, the cooperation will likely be low-profile. At best, the parties will coordinate their efforts and share relevant information, while acting on their own or, perhaps, along parallel directions. That said, even this kind of trust will be helpful for mending the rift between the countries.

First published in Russian in Kommersant.

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 #18
Russia Direct
www.russia-direct.org
June 10, 2015
Is Russia finally turning its back on Assad?
Media reports that the government in Damascus may fall, combined with changing Russian rhetoric and signs of high-level diplomatic meetings between Russia and the U.S. on Syria, could augur a major foreign policy change for Moscow.
By Yury Barmin
Yury Barmin is a strategic risk consultant based in the UAE. He holds an MPhil Degree in International Relations from the University of Cambridge. His interests include Russian foreign policy and the politics of the Gulf.

Recent media coverage of the ongoing civil war in Syria has been marked by mixed reports about the military successes of the government forces. That, in turn, is leading to increased concerns that the government in Damascus may fall, and that Russia may already be altering its policy stance on Syria in advance of such an event.

While some have suggested that Syrian President Bashar Assad is poised to win the war against the rebels while the U.S.-led coalition takes on the major burden of dealing with the Islamic State of Iraq and the Greater Syria (ISIS) through air strikes, others report that Assad has suffered a string of defeats, including from rebels in Al-Sughour, a town in Northwestern Syria, and from Islamic State (ISIS) in Palmira.

Reports of these military setbacks have prompted countless media speculation that the government in Damascus may fall soon. Some media outlets took the story as far as to suggest that Russia, a long-time backer of the Assad regime, might in fact make a U-turn on Damascus and give up on supporting Assad.

Connecting the dots on recent Russian moves in Syria

Newspaper Asharq Al-Awsat, for instance, has reported that for three consecutive months Russia has been reducing its diplomatic staff in Damascus, which was interpreted as a sign that Moscow is preparing for Assad's defeat.

"Moscow had also recently transferred around 100 senior diplomatic and technical officials working in Syria back to Russia," the Saudi-backed, London-based publication quoted a Western diplomatic source as saying.

The paper said that a group of Russian diplomats and their families boarded a Moscow-bound plane in the coastal city of Latakia several days ago.

The paper also noted that Russia has stopped honoring its agreement with Damascus to maintain the SU-22 and SU-24 fighter jets that constitute the bulk of the Syrian Arab Air Force, which has been key to the fight against the rebels.

Other sources suggest that Russia has significantly changed the tone of its Syria rhetoric during talks with the Americans.

Pan-Arab Al Hayat paper has recently quoted its diplomatic sources as saying that Moscow may be discussing specific terms for Assad's departure and even the names of military and political officials that would oversee the transition period in Syria.

None of these reports can be independently verified, but it does seem that Moscow's position on Syria is in fact changing. The changes, however, seem to be more subtle than the anti-Assad coalition imagines.

The US and Russia could be hammering out a common approach on Syria

The unofficial consultations between the Assad government and Syria's internal opposition that took place in Moscow in April did not result in a breakthrough.

The seemingly successful first round of consultations in January was even welcomed by Washington, which is why stakes for Russia were high and disappointment bitter when the second round yielded no positive result.

It looks like both Moscow and Washington are beginning to realize that their efforts to tilt the balance in the Syrian war have not come to fruition. Despite the Cold War-like atmosphere in Russia-U.S. relations, the two seem to have engaged in active diplomacy over a number of issues, including Syria, albeit behind the scenes.

In a recent interview with the Russian TV Channel Dozhd, Maria Zakharova, the Russian Foreign Ministry's spokesperson, said that 2014 saw an unprecedented intensification of contacts between American and Russian diplomats.

Of particular importance is U.S. Secretary of State John Kerry's visit to Sochi in mid-May where the Secretary of State met with Russian President Vladimir Putin and Foreign Minister Sergey Lavrov. Ukraine topped Kerry's agenda in Russia but it turns out the visit was also necessary to prepare another high-profile meeting several days later.

On May 18, U.S. Special Envoy for Syria Daniel Rubinstein traveled to Moscow and met with Putin's Middle East envoy Mikhail Bogdanov, who is essentially a key person in Russia's Syria policy.

It remains unknown what the two officials discussed off the record but the fact that the Syria policy chiefs from Russia and the U.S. sat one-on-one and talked Syria is significant in itself.

Following this meeting, however, the Russian authorities said that Moscow's and Washington's positions on Syria are getting closer.

Kazakhstan as a diplomatic proxy for Russia in Syrian talks

The most significant event that may shed light on Moscow's new strategy towards Syria took place outside Russia. In late May, some 30 Syrian opposition delegates gathered in Astana, the capital of Kazakhstan, for reconciliation talks.

Most media outlets have interpreted this conference as Astana's attempt to position itself as an independent arbitrator between the regime and the opposition, yet the talks would not have happened without Russia's full approval.

In fact, it was likely the Russian government that proposed to move the talks from the "Moscow platform" to the "Astana platform" to boost their credibility. Moscow has long been seen as a major ally of Assad, which is why its attempts to bring the opposition and the government to the negotiating table were met with suspicion both in the West and the Middle East.

Kazakhstan is a secular country with a Muslim majority that is firmly in the Russian sphere of influence, so Moscow thought that Astana could play a major role in Syria talks as a Russian diplomatic proxy.

A Russian government source has confirmed off-the-record that a small diplomatic delegation from Russia was also present in Astana during the Syrian opposition talks.

Coordination with Moscow is likely happening through Kassis, who visited Moscow in January and April 2015 and sent a letter to Kazakh President Nursultan Nazarbayev asking him to host the Syrian opposition. Kassis has been in touch with the Russian authorities for a while now and more recently met with Bogdanov in Moscow to discuss the possibility of a second meeting in Astana.

One of the goals of this new policy is to reconcile with the Gulf monarchies, who have continuously criticized Moscow, Assad's ally, for its attempts to play a role of a mediator in this crisis. Moscow has sought to mend ties with the Gulf ever since the crisis over Ukraine broke out in Russia-West relations and the Kremlin decided to make a political pivot to Asia.

The Russia-initiated talks earlier this year were ineffective in bridging the differences between Assad and the opposition, yet their negative impact on Russia-Gulf Cooperation Council (GCC) relations was enormous. Since the "Moscow platform" is unacceptable for too many parties and while the world continues to look for a solution for Syria, Russia doesn't want to be left out. So Astana hosting the opposition should be interpreted as a continuation of Moscow's diplomatic efforts, albeit through a proxy.

Putin's desire to reconcile with the GCC (a union of all Arab states of the Gulf) is all the more evident because, following the Kazakhstan talks, Russian diplomats met with Saudi and Emirati officials.

In late May, Bogdanov traveled to Saudi Arabia where he was welcomed by King Salman, Crown Prince Mohammed and Foreign Minister Adel Al Jubeir, while Lavrov hosted UAE's Foreign Minister Abdullah Al Nahyan in Moscow.

The fact that these high-profile meetings took place right after the Astana talks means that Russia's attempts to demonstratively distance itself from the Assad regime had their effect.

However, suggesting that Moscow has decided to completely abandon the Assad regime is far-fetched and premature. Moscow has invested too much in supporting the Syrian government through aid, weapons and diplomatic efforts that cost Russia dearly.

Moscow is still convinced that the West and the GCC will end up accepting Assad once current airstrikes against ISIS prove to be ineffective and the need for a joint ground operation becomes apparent.

Until then, Moscow is likely to keep its ties with the Syrian government low-key, while waiting to be asked to revitalize ties with Damascus and bring Assad to the negotiating table.

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#19
New York Times
June 10, 2015
Survey Points to Challenges NATO Faces Over Russia
By MICHAEL R. GORDON

WASHINGTON - As NATO faces a resurgent Russian military, a substantial number of Europeans do not believe that their own countries should rush to defend an ally against attack, according to a comprehensive survey to be made public on Wednesday.

NATO's charter states that an attack against one member should be considered an attack against all, but the survey points to the challenges the alliance faces in trying to maintain its cohesion in the face of an increasingly aggressive Russia.

"At least half of Germans, French and Italians say their country should not use military force to defend a NATO ally if attacked by Russia," the Pew Research Center said it found in its survey, which is based on interviews in 10 nations.

Ivo H. Daalder, a former American ambassador to NATO and the president of the Chicago Council on Global Affairs, said that after a quarter-century in which NATO worried little about defending its territory against Russia, "it will take a serious effort by the alliance to convince its public of the need to prepare for, deter and, if necessary, respond to a Russian attack."

The survey is likely to send an unsettling message to Baltic members of the alliance, which have been looking for more assurances from NATO that it will protect them from Russian meddling.

Estonia, Lithuania and Latvia have been worried that they may become targets of some of the "hybrid war" tactics that Russia has used to try to mask its operations in eastern Ukraine. They include the use of specially trained troops without identifying patches whose operations are denied by Moscow.

"Our data shows that Germans, French and Italians have little inclination to come to a NATO ally's defense," said Bruce Stokes, the director for global economic attitudes at the Pew Research Center, "and if the next military conflict in the region is hybrid warfare, and there is some debate who these Russian-speaking fighters are, such attitudes will only further inhibit NATO's response."

The Pew report is based on 11,116 telephone and face-to-face interviews in eight NATO countries as well as Russia and Ukraine. The interviews were conducted from early April to mid-May, and the results have a margin of error of roughly plus or minus three to four percentage points, the center said.

The Western alliance has long found it difficult to mobilize public support for military spending. But public opinion is not always decisive in shaping NATO policy.

President Ronald Reagan managed to win sufficient European backing to deploy Pershing II and ground-launched cruise missiles on the Continent despite a substantial peace movement. Those missile deployments increased pressure on the Kremlin to negotiate a 1987 American-Russian treaty banning intermediate-range land-based missiles.

Not all of the data in the Pew report is bad news for NATO. According to the study, residents of most NATO countries still believe that the United States would come to their defense. Americans and Canadians also largely say that their countries should act militarily to defend a NATO ally, and nearly half of the British, Polish and Spanish respondents say the same.

"You would have a basis for building a political consensus if there was a serious Russian attack," Mr. Daalder said.

But the study highlights sharp differences within the alliance's ranks. Of all those surveyed, Poles were most alarmed by Moscow's muscle flexing, with 70 percent saying that Russia was a major military threat.

Germany, a critical American ally in the effort to forge a Ukraine peace settlement, was at the other end of the spectrum. Only 38 percent of Germans said that Russia was a danger to neighboring countries aside from Ukraine, and only 29 percent blamed Russia for the violence in Ukraine.

Consequently, 58 percent of Germans do not believe that their country should use force to defend another NATO ally. Just 19 percent of Germans say NATO weapons should be sent to the Ukrainian government to help it better contend with Russian and separatist attacks.

Support for the NATO alliance in Germany was tallied at 55 percent, down from 73 percent in 2009. Those results are influenced by Germans in the eastern part of the country, who are more than twice as likely as western Germans to have confidence in President Vladimir V. Putin of Russia.

In the United States, the study notes, support for NATO remains fairly strong. Americans and Canadians, it says, were the only nationalities surveyed in which more than half of those polled believed that their country should take military action if Russia attacked a NATO ally. Forty-six percent of Americans believe that the United States should provide arms to the Ukrainian government, though Republicans are more likely than Democrats to support such a move.

The findings on Russians' attitudes are likely to be disappointing for NATO supporters.

Western officials have calculated that economic sanctions will eventually erode Russian support for Mr. Putin's decision to intervene in eastern Ukraine, but he has remained extremely popular by riding a wave of nationalism and controlling much of the news media. Most Russians are unhappy with the state of the economy, but they tend to blame not Mr. Putin but the drop in oil prices and the West's efforts to punish Russia.

Eighty-eight percent of Russians said they had confidence in Mr. Putin to do the right thing on international affairs, the highest rating since Pew started taking polls on the question in 2003.

"The Ukrainian situation continues to be very good for Vladimir Putin with his own people," Mr. Stokes said. "The Russians feel the pain of the economy, but they blame it on the West, not on Putin."

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 #20
Sputnik
June 10, 2015
Germans Overwhelmingly Declare They Want Russia Back in G8

Despite the harsh rhetoric and media speculation, a recent poll undertaken by a German news channel reveals that 89 percent of those Germans questioned want Russia back in the G8 club; however Sputnik's own poll reveals that only 27 percent want Russia back in the G8, with 62 percent feeling that the format no longer has any global relevance.

89 percent of Germans want Russia to be back in the G8 format.

The poll was being held by German n-tv news channel, an affiliate network of CNN on its teletext pages.

However, a similar poll conducted by Sputnik on its website reveals that only 27 percent want Russia to discuss international politics in this format, while 62 percent are convinced that the format has long lost its relevance for the world.

The G7 members - Britain, France, Germany, Italy, Japan, the United States and Canada brought Russia into their club in 1998.

However in March of 2014 they suspended its membership due souring relations with Ukraine.

Since then, there have been lots of discussions with some politicians and entrepreneurs claiming that the refusal to invite Russia is a "missed opportunity" to set up a constructive dialogue in a number of conflicts.

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 #21
The American Interest
www.the-american-interest.com
June 9, 2015
Swimming with Sharks
The Kremlin is sending a message to the West's Russia experts: if you want to talk to us, you need to toe the line.
By Lilia Shevtsova

An interesting thing happened this past week. The Western accommodationist school, which has been calling on the West to "understand" the Kremlin and stop irritating it, even as it tries (and often succeeds) to preserve its reputation as an alternative voice, suffered a humiliating setback. The Western supporters of the "let's accommodate the Kremlin" mantra will now have to follow the example set by their counterparts in the Russian accommodationist school, who were already given to understand that they had to forget about their reputation if they wanted to remain in the profession. The Kremlin has rejected ambiguity, forcing the intellectual and political community to choose sides in the black and white landscape: "Those who are not with us totally and unequivocally, are against us!" Nearly all Russian foreign policy experts (with few exceptions) have made their choice, preferring to remain in the approved mainstream and in line with the Kremlin.

Now it's the Western accommodators' turn to choose, much to their consternation. Quite a few of them apparently had hoped their model of relations with Russia would work, and that they could continue to discuss with their Russian counterparts solutions for the Ukrainian problem and for easing tensions between Moscow and the West without becoming Kremlin mouthpieces. Not any more. Last week the Kremlin issued an ultimatum: if you want to be our counterparts, you have to accept our truth!

The bitter irony is that Moscow chose the shrewdest among the accommodators to be the whipping-boy: the managing director of Kissinger Associates, former White House Russia hand Thomas Graham, a person with strong knowledge of Russia and powerful connections in the country. The choice of Graham, I think, was deliberately made to convince the rest that times have changed and there is no more room for ambiguity.

Graham has spent a great deal of time and energy over the years trying to persuade the West to understand the Kremlin's arguments. One might even say that the Kremlin owes Graham and those like him a debt of gratitude for their efforts to portray the Kremlin's arguments in a less threatening light. Sometimes Graham and his colleagues undertook initiatives that were puzzling. For example, according to former FSB General Leonid Reshetnikov, director of the Russian Institute for Strategic Studies (until 2009 a Russian foreign intelligence institution), which allegedly offered justification of the Crimea annexation and Russia's involvement in Ukraine, Graham and a Carnegie team approached them with a plan for peaceful solution to the Ukraine crisis. "We spent long hours with them", said General Reshetnikov.

And the reward for all these efforts? The Chairman of the Russian Duma Sergei Naryshkin, responded to an essay written by Graham in the Financial Times with guns blazing, accusing him of harboring a condescending attitude toward the Russian people. [http://izvestia.ru/news/587375] "As if diverting accusation from the Russian president of all sins, Graham accused all Russian people. It appears that we are hegemons, barbarians and imperialists at the same time," rages Naryshkin. As if on cue, other pro-Kremlin media chimed in with accusations that Graham is a Russophobe! One should not be so naive as to think that Chairman Naryshkin has nothing better to do than to dash off a response to every FT op-ed he disagrees with. Nor is it that he felt particularly stung by Graham. Rather Naryshkin is sending a clear message to the Western community on behalf of the Kremlin, laying out the narrative boundaries Western experts and politicians ought not to cross if they wish to remain in the Kremlin's good graces.

I agree with Naryshkin, however, that Graham's piece is condescending. Indeed, Graham presents a caricature of Russia. He argues that the West doesn't have a Vladimir Putin problem but "a Russia problem"-specifically the problem of Russia's tradition of personalized power and subjugation. "The Russian president stands within a long tradition of Russian thinking. His departure would fix nothing," says Graham. Isn't there at least a tinge of racism to this idea-that Russians are destined to an autocratic rule?

The accommodationists have used this argument before to help explain the need to deal with "Russia as it is" and not get hung up on criticism of Russia's leadership. This argument is the basis of the realist-pragmatist approach. Until now it has never really bothered the Russian leadership. It's quite an irony, therefore, that Graham's argument seems to have united in outrage both the Russian opposition and the powers-that-be.

At the root of the problem is the accommodationists' failure to realize that we have turned to a new page in the Russian story. If they wish to maintain their access to the Russian mainstream, they will have to change their political vocabulary. Mentioning the Russian tradition probably would not annoy the Kremlin too much, but the rest of Graham's lexicon has to be retired permanently. Among his offending words are his description of Russia as "the declining state," his characterization of Ukraine as "a barrier to Russia's assault on European norms and unity," and the very idea of containment. All of these concepts are unacceptable, Naryshkin warns.

If the accommodationists have any question about what their new talking points should be, Chairman Naryshkin helpfully points to the French, who have developed "constructive ties with Russia."

Have the accommodationists received the Kremlin's message? If so, which way will they swim? It's hard to say, of course, but one thing is clear: Swimming with sharks is always a risky business.

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 #22
Consortiumnews.com
June 9, 2015
Obama's Stupid Propaganda Stuff
By Robert Parry
Investigative reporter Robert Parry broke many of the Iran-Contra stories for The Associated Press and Newsweek in the 1980s.

Exclusive: Just last month, President Obama dispatched Secretary of State Kerry to secure Russian President Putin's help in addressing the Syrian crisis and other world hotspots - but despite Putin's agreement, Obama has reversed himself and is back hurling insults at the Russians, a troubling development, writes Robert Parry.

President Barack Obama must know better regarding the crisis in Ukraine, but he insists on reciting the propaganda lines drafted by his neoconservative and "liberal interventionist" advisers blaming everything on Russian President Vladimir Putin.

Perhaps, Obama just doesn't have the nerve to go against Official Washington's "conventional wisdom" no matter how misguided it is. The last time that Obama went against the grain in a decisive way was when he objected to the Iraq War in 2002, but then, of course, he was just a state senator in Illinois.

Watching his behavior in the White House over the past six-plus year, I've come to suspect that - if he had been a national politician amid the Iraq War fever - he would have gotten in line just like ambitious Sens. Hillary Clinton, John Kerry and Joe Biden did. Even as President, a position that gives him enormous power to push back against Official Washington's "group think," he won't.

Instead Obama spouts stupid propaganda stuff that is ultimately damaging to the American Republic. At a moment when Obama needs Putin's help in addressing dangerous crises in the Middle East - particularly to deal with advances by Al-Qaeda's Nusra Front and Al-Qaeda's hyper-violent spinoff, the Islamic State - Obama insists on joining in more misrepresentations about the Ukraine crisis.

At the end of the G-7 summit in Bavaria, Germany, Obama proudly announced that he had gotten the other six industrial powers to continue sanctions on Russia, based on the dubious argument that it is Russia, not the U.S.-backed regime in Ukraine, that requires more pressure to implement last February's Minsk-2 agreement.

The Minsk-2 deal largely reflected Putin's ideas regarding negotiations with ethnic Russian rebels in the east and constitutional changes granting the region substantial autonomy. However, after Minsk-2 was signed, hardliners in the Ukrainian government immediately sought to sabotage the political side by inserting a poison pill that required the rebels to essentially surrender before any negotiations could begin.

Since then, the Kiev regime has bulked itself up militarily, including training from 300 U.S. military advisers. In May, Ukrainian President Petro Poroshenko talked publicly about resuming the war and retaking rebel-held territory in the east, a position that even caused U.S. Secretary of State John Kerry to suggest that Poroshenko should "think twice" about such an action.

Kerry made that remark during meetings with Putin and senior Russian officials in Sochi, Russia, in what then appeared to be a realistic shift in Obama's foreign policy, recognizing the grave dangers from a possible Al-Qaeda victory in Syria and the need for Russian help in averting that disaster. [See Consortiumnews.com's "Obama's Strategic Shift."]

However, in the last few weeks, the flip-flopping Obama seems to have flopped back into the hard-liners' camp of neocon Assistant Secretary of State for European Affairs Victoria Nuland and liberal-interventionist Ambassador to the United Nations Samantha Power. Not only did Obama press the G-7 allies to renew sanctions on Russia, Obama hurled personal insults at Putin.

Pointing Fingers

In remarks to the news media on Monday in Krun, Germany, Obama said, "there is strong consensus that we need to keep pushing Russia to abide by the terms of the Minsk agreement ... [and] that until that's completed, sanctions remain in place. There was discussion about additional steps that we might need to take if Russia, working through separatists, doubled down on aggression inside of Ukraine. ...

"Ultimately, this is going to be an issue for Mr. Putin. He's got to make a decision: Does he continue to wreck his country's economy and continue Russia's isolation in pursuit of a wrong-headed desire to re-create the glories of the Soviet empire? Or does he recognize that Russia's greatness does not depend on violating the territorial integrity and sovereignty of other countries?

"And as I mentioned earlier, the costs that the Russian people are bearing are severe. That's being felt. It may not always be understood why they're suffering, because of state media inside of Russia and propaganda coming out of state media in Russia and to Russian speakers. ...

"And, ironically, one of the rationales that Mr. Putin provided for his incursions into Ukraine was to protect Russian speakers there. Well, Russian speakers inside of Ukraine are precisely the ones who are bearing the brunt of the fighting. Their economy has collapsed. Their lives are disordered. Many of them are displaced. Their homes may have been destroyed. They're suffering. And the best way for them to stop suffering is if the Minsk agreement is fully implemented."

In other words, Obama was doing the Full Monty of Official Washington's "group think" on the Ukraine crisis - that it was all caused by Putin's "aggression" and his delusions about reestablishing the Soviet or Russian Empire. But Obama knows the real history of the U.S.-supported coup d'etat that ousted Ukraine's elected President Viktor Yanukovych on Feb. 22, 2014, despite Yanukovych's political agreement a day earlier with France, Germany and Poland to accept reduced powers and early elections.

Rather than defending that political settlement, the United States and its European allies immediately recognized the coup regime as "legitimate," although it included neo-Nazis and other violent right-wing extremists who were rabidly hostile to Ukraine's ethnic Russian minority.

In the face of worsening violence, the people of Crimea - where ethnic Russians are a substantial majority - voted overwhelmingly to secede from Ukraine and rejoin Russia, an action supported by Russian troops who were based at Russia's historic naval base at Sevastopol in Crimea. Russia accepted Crimea's request but balked at a similar appeal from ethnic Russians in eastern Ukraine.

Then, amid feverish anti-Russian propaganda in the U.S. and European news media, the Kiev authorities designated the ethnic Russian resistance in the east as "terrorists" and mounted a brutal "anti-terrorism operation" against the population with the regime's neo-Nazi and other extremist militias spearheading the attacks. [See Consortiumnews.com's "Seeing No Neo-Nazi Militias in Ukraine."]

It was in the face of this ethnic cleansing that Russia moved to assist the defense of the so-called Donbass region. Yet, now Obama places the blame for all the destruction and suffering in eastern Ukraine, where thousands have died, not on the U.S.-backed Ukrainian government and its thuggish militias but on Putin.

And, with no sense of irony, Obama suggests that it is the Russian media that is distorting the story, another favorite theme of the U.S. propaganda campaign on Ukraine pushed by both the Obama administration and the mainstream U.S. media.

There was an up-is-down quality to the way that Obama presented the Ukraine situation which is troubling in one of two ways - either he believes his own propaganda or he is a conscious liar. There's also a third possibility, that he has completely lost his bearings and adopts one position one day and veers in the opposite direction the next depending on who last talked to him.

But whatever the case, Obama cannot expect Putin and the Russians to view his public comments and contradictory behavior in a favorable light - and then agree to cooperate with Obama on other hotspots where U.S. interests are much more endangered.

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 #23
Interfax
June 9, 2015
Moscow demands answers from USA on alleged plans to place missiles in Europe

Russian Deputy Defence Minister Anatoliy Antonov has demanded an explanation from the USA regarding alleged plans to deploy ballistic and cruise missiles in Europe, which he has said would mean a US "exit" from the Intermediate-Range Nuclear Forces (INF) treaty, privately-owned Russian military news agency Interfax-AVN reported on 9 June.

"The measures the American sources are talking about would mean the USA's exit from the INF treaty," Antonov said. "Of course, we are paying attention to these articles in the Western press," he added.

"In order to receive official explanations from the Americans we have sent a request along military diplomatic channels to set out the Pentagon's position on the statements allegedly authored by the chairman of the Joint Chiefs of Staff, Martin Dempsey," the deputy minister said.

Antonov added that Russia had made "multiple statements" on its commitment to upholding the INF treaty, and that "the return of American intermediate and short-range missiles to Europe and their deployment in other regions where they could threaten Russia and other countries" would have a "sharply negative influence on global security and stability". Antonov called for the USA to provide "clear answers" to Russia's questions.

"Russia has serious claims on the USA's observance of a number of provisions of the treaty. We would consider an honest dialogue at the expert level to be useful - but not one in which one side makes unfounded and unspecific accusations while rejecting objective concerns from the other side," he continued.

Antonov also criticized media reports on "the necessity for the USA to work together with its allies to compensate for alleged 'Russian violations' of the INF treaty".

"These articles coincided with yet another flare-up in the West's anti-Russia campaign in the run-up to the G7 summit and the upcoming EU summit, where the issue of the viability of prolonging anti-Russia sanctions will be discussed," Antonov noted.

"We get the impression that the USA is pushing the topic of 'Russian violations' as a pretext to implement its own allegedly 'retaliatory' military steps aimed to cement American 'leadership' in the confrontation with the 'Russian military threat', a myth Washington is stubbornly pushing in spite of obvious facts," he said.

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#24
Wall Street Journal
June 6, 2015
Putin and the Doctrinal Definition of Threat
Joint Chiefs Chairman Gen. Martin Dempsey looks at today's Russia
By JULIAN E. BARNES

President Barack Obama and other leaders of the Group of Seven leading nations are meeting beginning Sunday in Germany, a gathering that will be dominated by concern over Russia and its actions in stoking the civil war in Ukraine.

The Wall Street Journal spoke recently with Gen. Martin Dempsey, chairman of the Joint Chiefs of Staff, about the rekindled strategic challenge of Russia. An edited excerpt of his remarks follow.

Q. Talk a little about how you see Russia. Is it a big strategic problem, is it a declining power? Where is it on the hierarchy of challenges?

A. When I give my advice to our elected officials, I talk in terms of threat, what could threaten our interests. Threat is the combination of capability and intent. That is the doctrinal definition. I can't tell you, as we sit here today, precisely what [Russian President Vladimir] Putin and Russia intend to do. They have demonstrated some behaviors outside the international order that clearly indicate that they are willing to push beyond what most of the nations with whom we deal consider to be international norms.

I can tell you on the capabilities side, they have developed some capabilities that do threaten security in Europe. I will just tick off a few of them:

Surrogates. They have demonstrated an ability to use surrogates.

They have demonstrated the ability to use instruments other than their military. They are very adept in the media space of propaganda, leading to subversion.

They have developed the capability to use their special forces to train, advise and in many cases assist the surrogate networks.

They have demonstrated the ability to conduct snap exercises with conventional forces that can coerce or at least threaten borders.

They own advantages in Europe-the advantages of time and geography.

They have demonstrated some capabilities with long-range aviation and with their nuclear forces that are clearly intended to signal the nations in Europe and us of their willingness to consider all the instruments of military power. I could go on and on.

We spend a lot of time trying to assess their intent. My job is to describe their capabilities and compare their capabilities with ours.

Q. The U.S. has been investing in technologies to counter China's military modernization for more than a decade. Is it time to start investing in capabilities to counter Russia. Are you already making those investments?

A. The capabilities China is developing and capabilities Russia is developing are similar. And therefore the work we have done to ensure we are not adversely affected by antiaccess strategies will work against state actors, whoever they happen to be.

Q. Russia is a pre-eminent nuclear power; they have made nuclear threats. How worried are you about the nuclear threat from Russia. Is this posturing?

A. I consider it to be extraordinary reckless. Back to the concept I described of how you define a threat-intention and capability-I don't know. But I do know they have a capability and have maneuvered it and we can't take that lightly.

Q. Does NATO need to respond to that?

A. It's mostly about strategic planning. That is one thing we talked about, ensuring we have accounted for all aspects of military power from the asymmetric to the strategic in our planning. And for the last 25 years we haven't had to do that.

Q. There is what some people call an asymmetry of interest in Ukraine between NATO and Russia. Russia is right there, they have historic ties. They are probably willing to escalate further. How do you counter what Putin is doing beyond a face-off in Ukraine?

A. Fundamentally, our approach has been to harden our NATO allies against the subversive activities Russia has demonstrated its willingness to use. We have the conventional threat posed by Russia's conventional forces. Separately, we've got this template that Russia has appeared to have employed that would cause us to harden our allies through training, equipping rotational exercises.

Internal to NATO, there is a healthy conversation about making sure ethnic populations are addressed in the internal domestic politics so they don't become vulnerable.

Q. If Putin is looking for wedge issues, how does the alliance maintain unity?

A. On certain issues, President Putin has stated his intent. One of his clear statements is he considers NATO as a threat to him and will look for opportunities to discredit and eventually undermine the alliance. He has been very open about that. What we do is ensure alliance solidarity in our decision making...

What should we be doing? We need to harden our allies who are NATO members. We are also doing the same thing with some of these nations that are NATO partners but not allies. We are training Ukrainian national guardsman in western Ukraine. We have a very aggressive campaign to help Georgia to reform its military and give it the capabilities to harden itself against subversive tactics. ...

It is about hardening before the crisis occurs. Because once the crisis occurs you get into this debate about what is escalatory and what is not escalatory. This is about acting precrisis to deter and prevent crisis.

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 #25
www.buzzfeed.com
June 9, 2015
Jeb Bush's Anti-Putin Republican Primary Tour
To win the GOP nomination these days, strong opposition to the Russian president is practically a prerequisite. Bush will visit three countries most agitated by Russian power - and use the trip to speak out sharply against Putin.
By McKay Coppins
BuzzFeed News Reporter

BERLIN - If all goes according to plan, Jeb Bush will end this week with a superlative worthy of a campaign bumper sticker: Vladimir Putin's least favorite Republican.

Beginning with a saber-rattling speech here Tuesday, the presidential contender is set to kick off a carefully choreographed five-day tour of European capitals - from Berlin, to Warsaw, to Tallinn, Estonia - designed to place him in meetings and photo ops with some of the continent's leading critics of Putin's Russia. Aides say the itinerary will help Bush lay out his vision for a more aggressive American stance against Russia, and illustrate what he considers to be the failures of President Obama's weak-kneed response to Putin's recent aggression in Eastern Europe.

It will also allow Bush to score political points with Republican primary voters back home. The day after he returns from Europe, Bush is expected to officially announce his bid for the presidential nomination in a party where few geopolitical figures are more reviled than Russia's president.

"Putin looms large in the American imagination in a way that no other Bond villain out there does," said Hugh Hewitt, an influential conservative talk radio host. He said the Republican voters he talks to "cannot name the president of China... but everybody knows the bare-chested, horseback-riding, Olympics-giving, country-invading Putin."

It's true that Putin has achieved a pop culture-fueled notoriety rarely bestowed upon world leaders. He shows up in best-selling spy novels, and inspires mocking memes that litter the internet. His barely fictionalized clone in the most recent season of House of Cards was notable, perhaps, for being the only character in the show who seemed less cartoonish than his real-life counterpart.

But Russia's growing potency as a political issue in 2016 is also emblematic of long-held frustrations on the right with Obama's foreign policy. When Russia annexed Crimea last year, many American conservatives called for immediate action from the United States, beginning by providing arms to Ukraine. The Obama administration has resisted those calls so far, in favor of economic sanctions and diplomatic pressure.

Hewitt has made it his mission to get Republican candidates on the record with regard to their Russia agenda, frequently quizzing them on air about the intricacies of NATO treaties and U.S. Naval policy. It was on Hewitt's show in March that Bush said the United States should be willing to use military force to prevent Russia from further infringing on the sovereignty of its allies in Eastern Europe - some of his more elaborative remarks on the topic. Bush also called for more NATO troops to be deployed in the region, and said the United States should start providing Ukraine with weapons.

But Bush has not yet distinguished himself as a true Russia hawk when compared to a field of GOP rivals like Sens. Ted Cruz and Marco Rubio, who regularly turn up on cable news and talk radio to rail against Russian aggression. At times, Bush's rhetoric has seemed a little vague and unsteady. In a question-and-answer session following a speech earlier this year on his foreign policy agenda, Bush emphasized engaging countries like Germany and stronger support for Ukraine. He also praised Obama for his so-called "forward lean" in the Baltics - but seemed unsure of whether the approach had been successful. "I don't know what the effect has been because it's really kind of hard to be on the road, and I'm just a gladiator these days, so I don't follow every little detail," he said.

Here in Berlin, Bush will use his appearance at a major economic conference to sharpen his rhetoric, calling for unified, aggressive NATO action against Putin's recent provocations.

"Russia must respect the sovereignty of all of its neighbors," he is expected to say. "And who can doubt that Russia will do what it pleases if its aggression goes unanswered? Our alliance, our solidarity, and our actions are essential if we want to preserve the fundamental principles of our international order."

From Berlin, Bush will head to Poland, an ex-communist state where anti-Russia sentiment permeates the political establishment. Last month, for example, Polish President Bronislaw Komorowski used a high-profile speech to warn that a recent parade in Moscow's city center commemorating the defeat of Nazi Germany was, in fact, a "demonstration of force." He predicted, ominously, "Once again, Red Square will turn into Tank Square, and the very same tank divisions which recently invaded Ukraine will be there. This is not about history; it's about the future."

While in Warsaw, Bush will meet with Andrzej Duda, the president-elect who recently defeated Komorowski in part by attacking his foreign policy for being too weak. According to Michal Kolanko, co-founder of the insider news website 300Polityka - a Polish Politico clone - the country's business and government leaders will welcome the sort of Putin-bashing that plays so well back home. But they may also seek to extract some campaign promises of their own from Bush.

"The U.S. is seen as the only country which could help Poland if the situation goes from bad to worse," said Kolanko. "If there's some sort of commitment from Bush in regards to U.S. military deployment in Poland, setting permanent bases in Poland, or strengthening U.S. presence in the region, that'd be seen as proof that he 'gets it' - that Putin's Russia is a Cold War-type enemy... There is hope that a GOP administration is going to be more 'realistic' and less dithering on Putin than Obama."

To drive his message home, Bush will conclude his trip across Europe at Russia's doorstep, touring a NATO cyberdefense facility in Estonia that was formed after the country endured a serious cyberattack that many suspected the Russian government of orchestrating.

Estonia's president, Toomas Hendrik Ilves, has worked urgently to bring attention to what he describes as a dire situation in the region, warning that his country - and other Baltic states - are obvious annexation targets for Putin. Asked last year to account for the international community's lackluster response to Russia's aggression, Ilves said, "The West has been in a state of shock."

When Bush meets with Ilves and his political allies later this week, he will likely present himself as a clear-eyed leader prepared to pry the West from its stupor, and finally confront Putin. Chances are, he'll be making the same pitch on the campaign trail next week.

"She persuaded the White House that it was an easy topple without knowing that, in a tribal society with nothing to replace it, you would have a civil war, sectarian killings spilling into Africa [and] weapons everywhere [in] Mali [and] central Africa. The big thing is the huge amount of geography that has been destabilized because of the Libyan overthrow."

Mr. Nader's criticism echoed comments form some of Mrs. Clinton's Republican rivals, including Sen. Rand Paul of Kentucky, who has said that she will have to answer not only for the deadly attack on the U.S. compound in Benghazi but for the other far-reaching consequences of her Libya policy.

For liberal activists, Mrs. Clinton's foreign policy record compounds their concerns that she doesn't truly support their agenda.

"We definitely view Hillary as pretty far right when it comes to foreign policy," said Alli McCracken, national coordinator for the feminist anti-war group Code Pink.

She said that Mrs. Clinton acts "more like a war general than a diplomat," including supporting the Iraq invasion, the troop surge in Afghanistan, the Libya overthrow and a potential strike on Iran.

"I hope that the left puts pressure on her to break away from the status quo," said Ms. McCracken. "I hope that there is pressure put on her to not just have left-leaning domestic polices and support of women's rights here in the U.S. but women's rights everywhere, and that means taking military options off the table."

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 #26
Washington Times
June 9, 2015
Hillary Clinton's hawkish position on Russia troubles both sides of aisle
By S.A. Miller

Democratic presidential front-runner Hillary Rodham Clinton has pivoted left on domestic issues but stands out on foreign policy as more hawkish than some of her GOP rivals, even stoking fears that she's ready to put the U.S. on a warpath with Russia.

Mrs. Clinton is poised to make her foreign policy experience as senator and secretary of state a central argument for her White House run. It's a record that includes supporting military intervention in Iraq and Libya, positions that put her at odds with her party's liberal base.

And since leaving the State Department in 2013, her harsh rhetoric about Russia raised eyebrows among hawks and doves alike.

At a California fundraiser last year, she reportedly compared Russian President Vladimir Putin to Adolf Hitler. At a meeting earlier this year with London Mayor Boris Johnson, he said she faulted European leaders for being "too wimpy" about challenging Mr. Putin.

Conservative commentator Paul Craig Roberts, an economist who served as assistant secretary of treasury under President Reagan, warned that Mrs. Clinton will have a difficulty backing down from a confrontation with Mr. Putin after calling him Hitler.

"When you go that far out on a limb, you really kind of have to go the rest of the way," he said in an interview at Infowars.com. "I don't' think there is any candidate that we can end up with as president that would be more likely to go to war with Russia than Hillary."

Mrs. Clinton isn't the only candidate to take a tough stand on Russia's annexation of Crimea and ongoing involvement in the warfare in eastern Ukraine. But she brings more heat to the discourse than any other Democrat or most Republicans.

Former Florida Gov. Jeb Bush, who is expected to announce his presidential run next week, gave a speech Wednesday in Berlin in which he said the West should "push back" against Russian aggression.

Mr. Bush described Mr. Putin as a bully who "will push until someone pushes back."

But he warned against being reactionary and pushing away the Russian people, as occurred during the Cold War.

"I don't think we should be reacting to bad behavior. By being clear of what the consequences of that bad behavior is in advance, I think we will deter the kind of aggression we fear from Russia," he said. "But always reacting and giving the sense we're reacting in a tepid fashion only enables the bad behavior of Putin."

Still, Mr. Roberts said that Mrs. Clinton doesn't just talk tough but "is in tight with the military-security complex."

Former Green Party presidential candidate Ralph Nader recently called her "a deep corporatist and a deep militarist."

He said that when Mrs. Clinton served on the Senate Armed Services Committee, she "never met a weapons system she didn't like."

Mr. Nader also blamed Mrs. Clinton for "almost single-handedly" pushing President Obama into lending U.S. military support to depose Libyan dictator Moammar Gadhafi, which unleashed chaos in the country that spread throughout the region and helped the terrorist army that calls itself the Islamic State gain a foothold.

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 #27
The Vineyard of the Saker
http://thesaker.is
June 9, 2015
Karelia: The unknown hotspot of the new Cold War
By Sakari Linden
Sakari Linden is a geopolitical writer, who has participated actively in the cultural cooperation to preserve and promote Karelian language and culture. He holds Master's degrees in Political Science and International Law.

Russia has tightened its grip from its North Western region of Republic of Karelia in 2015. After being a remote area of negligible strategic importance, Karelia's growth in importance has been noticed by geopolitical observers in both Russia and the West. Final conclusions drawn about the means to be conducted in the region determine Karelia's status as either opportunity or threat for Russian Federation. Even more importantly, it reveals a great deal of the amount of self-confidence and strength of Russia. Does future Russia tend to rely more on hard discipline in avoiding all potentially risky influence from abroad? Or does it aim to benefit from soft power dimension provided by Karelia's unique cultural features creating cross-border links between east and west?

Nikolai Patrushev, Head of the Security Council of the Russian Federation, aligned stance of his country to a social situation in the Republic of Karelia with a speech held on 19 March in Petrozavodsk. According to Patrushev, there had been "an activation of nationalist and revanchist social-political organizations in Finland" in recent months. Patrushev fears that the Finnish nationalist associations are acting under the guise of human rights organisations and begin to have "serious ideological influence" on the population of the region. He had noted already on 17 December 2014 that Karelia is Russia's most important outpost in the Northwest.

Later, potentially as a further explanatory step to Patrushev's statement, Russia's Ministry of Interior Affairs started investigations about accusations claiming that a Petrozavodsk based NGO, Nuori Karjala (Young Karelia, Молодая Карелия), which aims to preserve and promote Karelian, Vepsian and Finnish indigenous cultures and languages in the region, has acted in a manner characteristic to a foreign agent. According to Russian law, a foreign agent is an organisation, which receive funding from abroad and act politically. Nuori Karjala is accused on the grounds that it organised a visit of the youth organisation of the Finns Party (Perussuomalaiset Nuoret) to the Republic of Karelia in cooperation with the regional parliament of Karelia. The Finns is a populist, Eurosceptic and Nato critical party, which currently makes part of the coalition government of Finland, in which they hold Foreign and Defence Minister positions. Moreover, Nuori Karjala is accused because it received a grant from the United Nations in 2013.

Nuori Karjala is Russia's first NGO representing indigenous peoples that threatens to be added to a list as a foreign agent. This would result in the closure of the organisation, has stated Alexey Tsykarev, member of board in Nuori Karjala and vice-chair of the United Nations Expert Mechanism on the Rights of Indigenous Peoples. Notwithstanding all the details provided, development leading to this should be seen through the lens of remarkably risen geopolitical significance of Karelia.

Secretly in the spotlight

Karelia has been a battleground between the East and the West for centuries. Karelia became a disputed borderland after the Peace of Nöteborg in 1323, which divided Karelia between Sweden and Novgorod. Religiously Evangelical Lutheran West Karelia was annexed as a part of the Russian Empire in the 18th century. This part of Karelia, often called as "Old Finland", became a part of the Autonomous Grand Duchy of Finland in 1812. Meanwhile, Orthodox East Karelia was all the time an integral part of Russia. Later, Soviet Union conquered Karelian Isthmus, historical fortress town of Vyborg and Ladoga Karelia from independent Finland during the Second World War.

Karelia became a bleeding wound for both parts during the Second World War. Almost 430 000 Karelian Finns, i.e. 12 per cent of the country's total population, lost their homes due to area losses, which accounted for about one tenth of the country's surface area. On the other side of the border, Finland occupied Eastern Karelia as part of the German offensive against the Soviet Union between 1941 and 1944. The occupation temporarily fulfilled an old dream about establishment of the Great Finland, a state uniting the areas populated by Baltic Finnic peoples, from Finland via Karelia and Ingermanland to Estonia. Russia's suspicion in the Republic of Karelia stem from the fear that the old idea of the Great Finland could be used in the modern framework of colour revolutions in order to threaten territorial integrity of Russia.

The start of the new cold war suddenly signified Karelia's rise to a new prominence. The most immediate reason for this was Stratfor's Decade Forecast: 2015-2025, published in February 2015, which predicts that Russia will start to collapse during the time span of next ten years, and "in the northwest, the Karelian region will seek to rejoin Finland".

Stratfor is not the first actor to give Karelia a major importance in the geopolitical game of modern times. The main ideologist of New Eurasianism, Alexander Dugin, proposed in his book The Foundations of Geopolitics: The Geopolitical Future of Russia, published in 1997, that "the unstable state of Finland, which historically enters into the geopolitical space of Russia" would be "combined together with the Karelian Autonomous Republic of the Russian Federation into a single ethno-territorial formation with maximal cultural autonomy, but with strategic integration into the Eurasian bloc". According to Dugin, "the northern regions of Finland should be excised and donated to Murmansk oblast".

Lack of knowledge about present day realities of the Republic of Karelia can be found from both Stratfor and Dugin's views. Although Finno-Ugric peoples have historically populated the region, there has been a dramatic fall in the amount of Karelian and Vepsian speakers. Karelians made up 37 per cent of the region's population in 1926, whereas in 2010, according to the Census of Russia, their share was only 7,4 per cent. Karelian speaking population is nowadays heavily concentrated to the countryside and especially to the national districts of Olonets, Kalevala and Pryazha. In reality, they lack political significance, which could affect the region's international status.

It is difficult to estimate whether Stratfor's Decade Forecast was seriously made, given the absence of further arguments to the prediction about Karelia seeking to join Finland. Or was it just a provocation aiming to recreate tensions related to a national question of East Karelia, which flamed out a long time ago? Or was it made to encourage the support of NATO in Finland or to create wishful thinking among those Finns, who wish to regain the territories lost by Finland during the Second World War? The latter have for a very long time had only a trivial role in Finnish political life. It is also important to realize that there are at least three different notions of Karelia: Orthodox East Karelia that has never made part of Finland, the old Finnish territories annexed by the Soviet Union, and provinces of North and South Karelia, which currently are an integral part of Finland. Very few people in Finland consider changes of borders as a realistic or even wise option.

Rather an opportunity?

Alexander Dugin reflected more realism and understanding about the new realities of Russian Karelia in his words during his visit to Finland in May 2014. Instead of proposing any changes of borders, as in his book published in 1997, he raised the possibility that Russian Karelia, Karelian language and culture could be a bridge between Finland and Russia, and more broadly between the West and Eurasia.

Dugin said in his speech he gave in Helsinki that Finno-Ugric peoples are part of a common Eurasian heritage and identity together with Slavic, Turkish and Caucasian peoples. Consequently, connections of the Finns to Karelia, Udmurtia and other Finno-Ugric regions of Russia should be encouraged. Dugin's statement is remarkable because it is the first expression of support from the part of a remarkable Russian commentator to the Finno-Ugric languages and cultures of Russia.

A deteriorated political situation of the world has cast a shadow even on the cooperation between Finland and Russia. Sometimes it feels like western and Russian orthodox civilizations do not understand each other's thinking at all. Karelia could potentially be a bridge between Finland and Russia. Karelia, at the same time as a linguistically close and religiously differing territory to Finland, would have an opportunity to illustrate the other side of the border with another way of thinking. Karelia could lower the mental gap between Finland and Russia and create links between different cultural spheres.

The main merit of Alexander Dugin's speech was to demonstrate that Karelia, where Baltic Finnic languages are spoken, are in both Russia and Finland's interest. Currently, there is a clear contradiction in Dugin's message compared to the latest news heard from the Republic of Karelia. It is unclear whether the rhetorics used by Nikolai Patrushev in March 2015 related to Karelia was meant to be a signal inside Karelia or towards Finland. What is clear is that it does not serve the best interest of Russia from the point of view of its soft power abroad. However, there is still hope that Karelian language and culture could be seen in a positive way even more broadly in Russia.

Implications for the new cold war

Finland is situated in a very strategically important position from the point of view of Russia. It shares a long border with Russia with a situation close to the crucial Murmansk naval base and Russia's second most important city, Saint Petersburg. Moreover, domination of the south coast of Finland would provide the NATO with a potential to block the Gulf of Finland and maritime routes to Saint Petersburg. Therefore, Finland's non-aligned position is of utmost importance to Russia.

Nowadays Finland is the only EU member state with a long border with Russia that does not belong to the NATO. After having been a militarily non-aligned country for several decades, there has been an increasingly hectic debate about whether Finland should join the NATO. Notwithstanding strong efforts by the mainstream media and political elite to push the public opinion in favour of joining the transatlantic community, only 27 per cent of the Finns supported their country's membership in the military alliance.

Finland was a crucial mediator between the west and east during the Cold war in the process, which culminated in the Conference on Security and Co-operation in Europe (CSCE) held in 1975 in Helsinki, Finland. Although Finland has lost a great deal of its sovereignty of its foreign policy due to its EU membership, President Sauli Niinistö has taken a rather mediating role between the west and Russia during the Ukraine crisis, relying on its last remains of its old non-aligned tradition. This highlights the potential that Russia can either utilize or lose in Finland.

Currently, Finnish public is scrutinizing the influence of Russia to their wellbeing and especially all efforts across their eastern border to put pressure on their country are under scrutiny. Therefore, one can just imagine the effect of the opening of the Finnish-speaking Sputnik news agency, which immediately reported as its breaking news about Mr Patrushev's warnings about the growing activity of Finnish nationalists and revanchists in Karelia.

Russia needs every bit of soft power in order to survive in the relentless informational warfare aiming to harm the Eurasian connection between Europe and Russia. As George Friedman, founder and chairman of Stratfor, has pointed out, the primordial interest of the United States is to stop a coalition between Germany and Russia (http://russia-insider.com/en/2015/03/16/4571). Consequently, Russia should not undermine the importance of Karelia as a potential source of its soft power. Karelian as a mutually intelligible language to Finnish, Karelia and Finland's common Kalevala folklore heritage, which has inspired even J. R. R. Tolkien, as well as Karelia's potential to function as a window to Russian and Eurasian mindscape for the Finns, are reasons why Russian authorities should think carefully if they are doing irreversible damage in the Russian-Karelian-Finnish cultural relations.

The beginning of the new cold war has raised tensions around the world. This has already reflected to the social situation in the Republic Karelia. Russian establishment's future reactions to Stratfor's predictions related to Karelia will tell about the ability and preparedness of the country to endure amid new geopolitical game. Russia's support to Karelian language and encouragement of creating contacts between locals and foreigners in the Republic of Karelia would be a signal to the world about a self-confident and strong country.

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 #28
Valdai Discussion Club
http://valdaiclub.com
June 9, 2015
Is the Russian Federation a Threat to the International Order?
By David Lane
David Lane is Emeritus Fellow of Emmanuel College, University of Cambridge, a Fellow of the Academy of Social Sciences and a Vice-President of the European Sociological Association
[Charts and footnotes here http://valdaiclub.com/russia_and_the_world/78040.html]

President Putin is widely portrayed as a threat to peace and the international order. One might distinguish between two ways of analysing a threat posed by a state in its conduct of foreign affairs.  First, there are positive drivers in the form of aggressive actions. These stem from the actions of state leaders who are motivated to attack other states for purposes of their own or their countries' economic or political advantage. Such policies may be driven by national or universalistic ideologies or by the ambitions of leaders. Hitler's Drang nach Osten and Britain's colonial conquest of India may be cited as examples an active policy [1].  Second, there are actions which are reactive to the policies of other states. These actions are driven by anxiety or fear derived from a belief that other states are behaving, or likely to behave, maliciously.  States with such perceptions may react aggressively to defend their interests. An example here is the placing of intercontinental missiles on Cuba by the USSR. Though Cuba claimed that the missiles were purely for defensive purposes, the USA perceived them as a threat and retaliatory aggressive action to defend its interests followed.

The debate about 'Russia as a threat' to the international order hinges on which of these two approaches one believes determines Russia's behaviour.

The 'Positive Drivers' Interpretation

The case for an active 'threat' has been put by academics, political leaders as well as journalists writing in the quality news journals.  Jean-Claude Juncker, the president of the European Commission, in March 2015 called for the formation of a 'European army to face up to the Moscow threat' [2] .  The objective is to 'defend the values of the European Union'. Timothy Garten Ash, in The Guardian (1 February 2015) revealed the evils of Vladimir Putin whom he described as 'the Slobodan Milosevic of the former Soviet Union: [who is] as bad, but bigger. Behind a smokescreen of lies he has renewed his drive to carve out a puppet para-state in eastern Ukraine' [3].

In the academic sphere, Michael McFaul contends that Russian foreign policy changed under Putin as a consequence of 'Russian internal political dynamics' [4].  For McFaul, the motivating factor is the public's disapproval (expressed in voting, demonstrations and the fear that Putin would be confronted with a popular 'coloured revolution') which led him to adopt policies that would 'mobilise his electoral base and discredit the opposition' (p.170). The USA was recast as an enemy, a 'sinister force in world affairs' (ibid).

A prominent theme explaining Russian action in foreign affairs is the drive to fulfil its geo-political goals. Russia is regarded as a country intervening militarily 'to maintain its influence across the domains of the former Soviet Union' [5] . In Hillary Clinton's view: 'We know what the goal [of the Eurasian Union] is and we are trying to figure out ways to slow down or prevent it' [6].  The objective here is to halt the spread of (supposed) Soviet norms which contaminate the values of liberal democracy and a market society.

The popular media message is one of personality and 'motive'. Russia's President is a demon combining the worst characteristics of Joseph Stalin, Adolph Hitler and Slobodan Milosevich (occasionally reaching back to Ivan the Terrible). 'Putin's Russia' is expansionist, nationalist, imperialist, dictatorial, and hypocritically anti-Western. It thrives on strategies to destabilise neighbouring countries, as well as NATO and the EU. The ideology of Eurasianism and the formation of the Eurasian Union are indications of the desire to reinvent the Soviet Union.  Consequently, 'Putin's Russia' is the cause of the civil war in Ukraine which is a precursor to the active destabilisation of the Baltic new member states of the EU and NATO.  This is a scenario of active aggressive politics.

The antidote prescribed by President Putin's critics is to escalate economic, political and military sanctions. Following the economic restrictions against Russian firms and persons, in March 2015 the advanced parties of the American and British military arrived in Ukraine.

Through the rhetoric one might identify four major issues underlying Russian policy. Firstly, I consider whether its leaders are motivated to promote their own interests by de-stabilising the international order; secondly, whether its ideology entails any threat to other states, nations or groups; thirdly, whether in its actions, it has promoted a military build up; and finally, whether the Russian Federation or the Eurasian Union possess the military capacity to pose a serious danger to the international order.

A 'Reactive' Interpretation

After the dismantling of the Soviet Union, Russia in foreign affairs was faced by two major challenges. Whereas Russia was in decline and its regional bloc (The Commonwealth of Independent States) was moribund, the former adversaries of the Soviet Union were being considerably strengthened. NATO and the European Union were enlarged. Moreover, both organisations had moved significantly to the east. Ironically perhaps, none of the reasons put forward for the expansion of NATO to the areas of the former USSR, were framed in the context of a possible (let alone likely) Russian move to seize former territories. NATO's expansion to the east started in 1999 with the entry of the Visegrad countries, followed in 2004 by Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia and Slovenia. Albania and Croatia joined NATO in 2009. Economically, politically and military, 'the West' had arrived at Russia's borders.  At the urging of the USA, in April 2008 NATO considered the addition of Ukraine and Georgia. Following opposition from Germany and France, they were not admitted. But the alliance did issue a statement that 'These countries will become members of NATO'.  If so, the encirclement of Russia would be complete. NATO's enlargement was justified in terms of the creation of a zone of peace.  The Russian 'threat' surfaced later.

From Russia's position, the expansion of NATO poses a serious threat to its security. The enhanced security of the New Member States is at the cost of less security to Russia. Russia has been reactive and defensive rather than actively aggressive. The policy of the Russian Federation under Putin and Medvedev entailed a major change towards the West which infringed some established Western assumptions.  In its Foreign Policy Concept (2000), Russia's objectives were to preserve the sovereignty and territorial integrity of the country. It noted critically 'a growing trend towards the establishment of a unipolar structure of the world with the economic and political domination of the United States.'   

Policy did not seek to overturn the hegemony of the USA or the neo-liberal framework in which it operated. It does not entail economic autarchy or political isolation.  Russia sought an alliance with the USA in its war 'on terror' - with his own concerns about Chechnia in mind - and allowed US planes to use Russian airspace to fly to Afghanistan.  Russia voted to support the UN Security council's sanctions against Iran. Even in 2002, Russia was pragmatic about the admission of the Baltic states into NATO. Russia also abstained from voting on the UN Security Council resolution authorising the use of force against the Qaddafi regime in Libya in 2011.

The European Union

The second major challenge facing the states of the former USSR was the enlargement of the European Union to include the post-Soviet countries of central Europe. Its initial objective (bearing in mind the history of two world wars) was to preserve peace in Europe by containing possible aggression by enveloping nation states within a common economic unit, the European Economic Community. The leadership of the EU justified enlargement as bringing not only economic wealth but also democratic European values. The development of a supra-national state, the European Union, has outgrown the original conception and has imperial pretentions.  It is now effectively a federal state composed of 28 'member states', including eleven post communist states [7].  Its membership makes it an economic counterpart to NATO.

As the European Commissioner, Jose Manuel Barroso on 10 July 2007 put it: 'We are a very special construction unique in the history of mankind. Sometimes I like to compare the EU as a creation to the organisation of empire. We have the dimension of empire. What we have is the first non-imperial empire. We have 27 countries that fully decided to work together and to pool their sovereignty. I believe it is a great construction and we should be proud of it' [8].  Here, in perhaps an unguarded moment, he raises the spectre of the European Union as an empire, and this view has led many to define it in terms of cultural and economic imperialism.

Membership requires the subordination of sovereignty of member states to a common economic, political and social policy framed in terms of neo-liberalism and competitive electoral polyarchy. In such a union, formal wars between member states cannot take place. In keeping with the institutional arrangements of the EU, new states had to conform to 31 chapters (35 since 2013) of the Acquis which range over the whole area of economic and political life. Foreign and defence policy must also be in keeping with EU norms and policy. As a customs union, the EU has common tariffs with outsiders. The driving forces for expansion are economic interests seeking markets (for products and labour) as well as geo-political concerns.

The Case of Ukraine

After the dismantling of the USSR, Ukraine found itself positioned between two blocs - the strongly entrenched EU and the weak association formed by the Commonwealth of Independent States. As shown in the two following diagrams, commerce was greater between Russia than the European Union.

Ukrainian governments have sought agreements with the EU which would not prejudice relations with its major trading partner, Russia. Things began to change after the Orange Revolution which brought to power President Yushchenko.  The leaders of the proposed Eurasian Union sought to maintain and enhance links with Ukraine which would have precluded Ukraine from joining the EU. In the autumn of 2013 the EU, to counter Eurasian influence, offered Ukraine an association agreement (Deep and Comprehensive Free Trade Area (DCFTA)).  To be effective the agreement would have extended the EU's tariffs to Ukraine's borders and consequently would have greatly restricted trade with the CIS.

The DCFTA presented Ukraine with a choice. It was contended by the EU that two sets of rules could not operate in the EU economic space [9].  Russian policy, basing the argument on common membership of the WTO, contended that both the EU and the Eurasian Union would be able forge a wider pan-European association. Sergei Lavrov, the Russian Foreign Minister suggested that both blocs could work together. 'We must work for a union of unions, an alliance of the EU and the Eurasian Union' [10].

The EU's objective was to prepare Ukraine for full membership (at some unspecified future date). Moreover, even without becoming a member of the EU, agreements between it and other states were increasingly embedded in conditions which sought to make their institutions and processes compatible with EU norms. These conditions were defined in terms of Washington Consensus ideology - free markets, private property, the rule of law (particularly concerning property), multi-party politics and electoral competition. EU strategy is to weaken gradually the sovereignty of states and to promote the power of the Union over its 'member states'. The Eastern Partnership was a device to extend the power of the EU over third parties, this time driven by the geo-political interests of the EU and consistent with American power wielded through NATO. The objectives were to be achieved through enlargement.

Negotiations between President Yanukovich and the European Union were conducted on the basis of the DCFTA.  While Yanukovich did not rule out signing the agreement at some future date, on 29 November 2013, he expressed a wish to achieve an agreement which would maintain relations with Russia. Future anticipated damage to Ukrainian producers (supporting Yanukovich), insufficient EU financial backing for economic reforms, as well as promised Russian financial support underlay his decision to withdraw from the EU proposal.

This became the fuse for the Maidan demonstrations in favour of EU membership supported on the streets in person by some prominent US and European politicians. EU made Ukraine choose, when Yanukovich did not take the right decision, the EU supported the opposition of the Maidan to make the decision. The demonstration turned to violence and the President's and Parliament's buildings were occupied by the armed opposition. The EU supported the then opposition (which had refused to participate in a government when offered posts in it). Their goal was to install the pro-EU opposition forces.  President Yanukovich fled for his life from Kiev on 22 February 2014. The context of armed uprising, of intimidation of pro-Yanukovich deputies in the Rada and as well as the illegal seizure of power leads one to define the change of political power as a coup d'état legitimated by mass demonstrations.

Following the flight of President Yanukovich, a new pro-EU nationalist government was installed. On the one side it signed agreements with the EU, on the other it was confronted by the secession of Crimea and civil war in the eastern territories.

Western media explain the underlying causes of Ukraine's break-up as a consequence of Putin's policies. Such an interpretation of events, derived mainly from statements originating in the Kiev pro European Union lobbies and government, can be dismissed or qualified in many respects.

There is no evidence before the putsch replacing the Yanukovich government in Ukraine that the policy of the Russian Federation was to destabilise the country.  During this time the Russian minority suffered language discrimination.  In the period following the Orange Revolution of 2004, in which the administration of Yushchenko moved closer to the EU, as well as the period in which the Yanukovich administration intended to sign an association agreement with the EU, there were no actions from Russia destabilising Ukraine. The economic consequences, however, might have had a destabilising effect. Indeed, there was no designation by the media of a 'corrupt' President Yanukovich when he was predisposed to sign the association agreement.

The Ukrainian civil war was precipitated by the illegal removal of Yanukovich and his government following the putsch of February which installed a government hostile to Yanukovich's supporters concentrated in the industrial Russian speaking east of the country. Their initial actions, particularly rescinding the language laws, which had given the right to regions under certain conditions to use the Russian language, strengthened the separatists who asserted their own power in Crimea and led to a revolt in Donbass and Lugansk.  

These 'anti-Kiev' movements were supported by the Russian Federation but they were not part of a planned policy to 'destabilise' Ukraine. Ukraine became destabilised by the actions of the pro-EU insurgents who had illegally replaced the elected President with Acting President Alex Turchinov. Despite Western insistence on Russian military involvement, there is no firm evidence of the involvement of the Russian army (though there certainly were, and are, volunteers) in east Ukraine in armed combat roles. On Jan 29 2015, the head of the General Staff of the Ukrainian Army, General Viktor Muzhenko, stated that "only individual Russian military personnel and citizens of the Russian Federation" are participating in military activities. "We are not currently conducting any military operations against units of the regular Russian army." [11]  Such unofficial Russian involvement is considerable and has been decisive in maintaining the separatists. It is not however part of a preconceived Russian 'plan' to destabilise Ukraine and NATO.

The official line of newly elected President Poroshenko was to pursue war by all means. As he put it in his statement of 14 November 2014: "We [in Ukraine] will have work they - [in Donbas] won't. We will have pensions - they won't. We will care for our children and pensioners - they won't. Our children will go to school, to kindergartens - their children will sit in cellars. They don't know how to organize or do anything. This, ultimately, is how we will win this war." [12]  He repeated his obdurate principles on 22 January 2015: 'Ukraine must remain a unitary state; there will be "no discussion" of Ukraine's European choice; and the only state language is and will be Ukrainian'. [13]    

A Military Threat?

NATO's expansion to the east was legitimated in the first instance as a means to secure an area of peace in Europe, not as a necessary defence mechanism against an aggressive Russia. However, following the Ukraine crisis, views changed. Anders Rasmussen, NATO's previous secretary-general, said in January 2015 that there was a 'high probability' that Mr Putin would test NATO's article 5, which regards an attack on any member as an attack on all.  On 20 February 2015, NATO's deputy commander opined that Russia's expansionist ambitions could become 'an obvious existential threat to our whole being'. (Reported in The Guardian 21 Feb. 15).

The geo-political goals of strengthening the hegemony of NATO underpin this policy.  The Russian military 'threat' is an assertion about 'motives' and is not based empirically on any assessment of military capacity. Russia as a military threat is illustrated by commentators by the fact that its defence spending has risen by 190 per cent between 2007 and 2014, whereas NATO's has fallen by some 20 per cent (The Economist, 14 Feb 2015, p. 20).

Russia's defence expenditure has increased in recent years. But the increase was from a low base. Given the size of population and the economic level of the country, comparatively its defence expenditure per capita is not excessively large.  In total outlays, Russia is outmatched in every area of defence spending by NATO. In 2014, according to statistics provided in the The Military Balance [14] , defence budgets for Russia was just over 10 per cent more than that of the UK. Its defence efforts are comparable to Western European NATO countries. Planned expenditure (2015) for USA is 581 billion US dollars; China 129.4; Russia 70; UK 61.8; France 53.1; Germany 43.9.  As a proportion of state budgets (data for 2014), the USA accounted for 36.1 per cent, Russia 4.4 per cent, UK 3.8 per cent, France 3.3 per cent, Germany 2.7 per cent,  other NATO countries 7.6 per cent. China 8 per cent and Japan 3 per cent.

NATO's weaponry is also greater in all areas than Russia and Eurasia, only China has more battle tanks than NATO. A telling comparative indicator is the amount spent expressed as a proportion of world defence and security spending which is shown in Figure 3.  If armaments' spending is the criterion, then expenditure is very much weighted towards the West with NATO greatly outspending its rivals.  Of course, Russia is a nuclear power and certainly more than a match for its immediate neighbours but not for NATO.

It is pure speculation (probably motivated to justify NATO's military role) to suggest that Putin is planning to test NATO's resolve.  Despite the denial of citizenship rights to a significant part of Russian speaking people born and living in Latvia and Estonia, Russia since the Baltics gained independence, has shown no intention or willingness to support the Russian minorities by the use of force.

The enlargement of the EU and NATO are dangerous if they threaten war between Russia and Ukraine. A fundamental value of the EU is to secure peace and there are ways of doing this without expanding the Union. It is unjustifiable hypocrisy to advocate peace and knowingly to pursue policies which threaten to lead to war. Clearly alternative strategies were available to the EU. But they were ignored as the entrapment of Ukraine in the EU was a major objective of EU policy.  EU enlargement and NATO expansion are greater threats to peace than the Russian Federation.
 
This article is based on two public lectures given in Leiden University and also in Greenwich University.

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 #29
UN: More than 870,000 Ukrainians flee the country because of armed conflict

GENEVA, June 9. /TASS /. The armed conflict in eastern Ukraine has forced about 878,000 people to seek asylum, residence permits or other forms of legal stay in other countries, spokesman for the United Nations Office for the Coordination of Humanitarian Affairs Jens Laerke told a press briefing in Geneva on Tuesday noting that he was talking about the June 4 estimates.

According to the UN data released earlier, the number of Ukrainian nationals who fled the country because of the conflict totaled 867,000 people on May 28.
In addition to that, more than 1.3 million people in Ukraine who were forced to leave their homes found refuge on the Ukrainian territory becoming internally displaced persons, Laerke said, citing data provided by the authorities in Kiev.

He noted that heavy fighting in Maryinka, close to Donetsk, on June 3, led to casualties and the displacement of the population. People who left their homes are at risk, since they are forced to move avoiding the roads in the areas where there may be unexploded shells and mines.

Access to drinking water in Maryinka and the adjacent areas is becoming a growing humanitarian problem. According to Laerke, about 10,000 people there are deprived of safe drinking water. Meanwhile, in the areas close to Lugansk "thousands of people" have no access to drinking water, he noted.

According to UN estimates, about 5 million people in Ukraine need humanitarian aid. The UN Humanitarian Response Plan for Ukraine calls for $316 million to reach 3.2 million people. So far, the UN received only 24% of the required funds, Laerke noted.

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 #30
Ukraine starts water supplies to Luhansk Republic

LUHANSK. June 10 (Interfax) - A week after the authorities of the self-proclaimed Luhansk People's Republic (LPR) complained to the Special Monitoring Mission (SMM) of the Organization for Security and Co-operation in Europe (OSCE), Ukraine has agreed to partially resume water supplies to the republic, says Alexander Drobot, head of the LPR Reconstruction Management Center (RMC).

"The OSCE did not give us formal answers but they [the authorities in Kyiv] have nevertheless agreed to turn on the water," he said on Wednesday, according to the Luhansk Information Center.

So far water will only be supplied through two water pipes from an area controlled by the Ukrainian military, the LPR RMC director said.

For his part, Alexei Anchishkin, chief engineer at the Luhansk Water Company, said that water has been supplied from Ukrainian territory to the LPR since last Tuesday. "Water supply to the republic from two water pumping systems in the Kyiv-controlled area began at 3 p.m. yesterday, June 9. Water pipe networks are being filled," he said

"But while water pipe networks are being filled, for a while water will be supplied according to a schedule. We ask residents of the republic to be understanding because it is difficult to distribute such a large amount of water among all cities," Anchishkin said.

On June 3 the head of the Luhansk military-civilian administration Hennadiy Moskal accused the LPR of starting 'a utilities war' and cut off water supplies to the republic in response to the alleged termination of power supplies to Stanitsa Luhanska (controlled by the Ukrainian army) by militia.

"Water supplies to Stanitsa [Luhanska] will not be restored unless light is back on and its steady supply has been assured," Moskal said.

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 #31
Irrussianality
https://irrussianality.wordpress.com
June 9, 2015
'SEPARATE REGIONS WITH SPECIAL STATUS'
By Paul Robinson
Paul Robinson is a professor in the Graduate School of Public and International Affairs at the University of Ottawa, and the author of numerous books on Russia and Soviet history, including 'Grand Duke Nikolai Nikolaevich: Supreme Commander of the Russian Army'

Point 11 of the Minsk-2 agreement which is meant to provide a road map to end the conflict in Ukraine, states that the Ukrainian government should undertake:

"Constitutional reform in Ukraine, with a new constitution to come into effect by the end of 2015, the key element of which is decentralization (taking into account peculiarities of particular districts of Donetsk and Luhansk oblasts, agreed with representatives of these districts), and also approval of permanent legislation on the special status of particular districts of Donetsk and Luhansk oblasts in accordance with the measures spelt out in the attached footnote, by the end of 2015."

In a previous post, I mentioned that representatives of the rebel Donetsk and Lugansk People's Republics (DPR and LPR) had laid out their suggestions for the required constitutional amendments. Until today, we only knew the broad outline, but the DPR's press agency has now published the complete text. The key proposed amendments are as follows: [http://dan-news.info/official/dopolneniya-i-izmeneniya-dnr-i-lnr-v-konstituciyu-ukrainy.html

"Article 1391: The regions, towns, and other populated points of Donetsk Province form a separate region with special status. The regions, towns, and other populated points of Lugansk Province form a separate region with special status. ... the principles of this status are to be defined by a separate Ukrainian law. ... The separate regions with special status are inseparable parts of Ukraine, and within the limits of their powers, defined by the Constitution, separate agreements, and any agreements about the division of powers among these regions ... they will independently decide those questions which are brought before them.

"Article 1292: The separate regions with special status will form electoral commissions on the territory of those regions. The electoral commissions of the separate regions with special status will be independent and not subordinate to the organs of the legislative and executive powers or other electoral commissions.

"Article 1393: The state will guarantee the financial independence of the separate regions with special status by 1) strengthening the budgets of the separate regions with special status with sufficient sources of finance to guarantee the balancing of the budget. ...  and 6) introducing a special economic regime.

"Article 1394: The organs of local self-government ... have the right to create organs to protect public order (people's militia). These organs' leaders are to be nominated to and removed from office by the organs of local self-government of the separate regions with special status.

"Article 1395: The organs of local self-government of the separate regions with special status will regulate the following matters: 1) agriculture, land resources and ownership ... 2) land improvement, 3) social work, charity, 4) urban construction, 5) tourism, 6) museums, libraries, theatres, and other cultural institutions, 7) transport, 8) hunting and fishing, 9) health service, 10) use of the Russian language ... 13) economics and investment within the framework of the special economic regime.

"Article 1396: The following matters will be considered by the separate regions with special status: 1) carrying out referendums, elections of members of local councils ... 7) guaranteeing the right to use Russian and other languages ... 8) preserving and constructing memorials ... 10) concluding treaties with foreign states on questions linked to the activities of the separate regions with special status, 11) collecting local taxes.

"Article 1397: Justice in the separate regions with special status will be administered by courts which are part of the court system of Ukraine. The creation and dismantlement of courts, and the appointment and dismissal of judges, will be carried out with the agreement of the organs of local self-government of the separate regions with special status. ...

"Article 133: The administrative territorial system of Ukraine consists of: the Autonomous Republic of Crimea; the separate regions with special status of Donetsk and Lugansk Provinces; the provinces, regions, towns, regions in towns, settlements and villages. ... The cities of Kiev and Sevastopol and the separate regions with special status of Donetsk and Lugansk Provinces have special status defined by Ukrainian law."

In addition to these amendments, the document also states that 'It is proposed that the Constitution of Ukraine be amended with the words "Ukraine will not join military blocs and alliances, will remain neutral, and will refrain from participating in military actions outside its own territory."'

In reviewing this, the Russian press has focused on the fact that the document lists Crimea and Sevastopol as part of Ukraine, as if this somehow means that the rebels are distancing themselves from Russia's annexation of Crimea and Sevastopol. This supposedly constitutes some form of scandalous political retreat.  In reality, the rebels must know that they cannot get the Ukrainian government to amend its constitution to remove the references to Crimea and Sevastopol. What matters is the proposed inclusion of Donetsk and Lugansk Provinces as 'separate regions with special status.'

The language used here is significant. There is no talk of 'autonomy' or of turning Ukraine into a 'federal' state. Rather the phrase 'special status' corresponds with the demands of Minsk-2. If the rebel proposals were to come into force, Ukraine would remain a unitary state, albeit one in which two provinces had unique local powers. Furthermore, the statement that the two provinces are 'inseparable parts of Ukraine' is extremely important. The labelling of the rebels as 'separatists' no longer fits the facts.

The powers requested by the rebels for the 'separate regions with special status' are not insubstantial. Even if the word 'autonomy' is not used, the proposed amendments would in practice make Donetsk and Lugansk Provinces very largely self-governing. That said, the proposed competencies of the separate regions are not out of line with what one can find in the states and provinces of many Western countries. Beyond the issue of neutrality, the suggestion which would be most likely to cause serious difficulties is that of creating a special economic regime for the separate regions. It would seem that in proposing this, the rebels have in mind the maintenance of close economic ties with Russia. The problem is that a special economic regime for one zone of Ukraine is not compatible with the country's ambitions to join the European Union (which allows for no such regimes).

Still, a deal along the lines suggested by the rebel document would allow all sides in the conflict to save face: Ukraine would preserve its territorial integrity, while the Ukrainian government could claim that it had successfully resisted attempts to federalize or confederalize the country; and the rebels could say that they had won significant autonomy. Even if some details might prove problematic, overall the rebels' document is not unreasonable as a foundation for negotiating a peace settlement.

Unfortunately, as I pointed out in my previous post, the Ukrainian government does not appear to be interested in negotiating. Despite the fact that Minsk-2 specifically states that the required constitutional reforms should include 'special status' for Donetsk and Lugansk, the government is insisting that they will consist only of a general decentralization of powers to all Ukrainian regions and will not involve any such 'special status' for Donbass.  Ukraine's Western allies should press it to reconsider.

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 #32
Self-proclaimed republics' proposals make compromise in Ukraine possible - diplomat

PARIS, June 10. /TASS/. Kiev's actions are evidence of rejection of Donetsk and Luhansk, Russian Deputy Foreign Minister Grigory Karasin told journalists on Wednesday ahead of the Normandy Four meeting.

"The gesture, the proposals on the table put forward by representatives of Donetsk and Luhansk open real possibilities for searching a compromise if Kiev really wants it," Karasin said. "Because we have some uncertainty about the real intentions of the Kiev authorities. Everything that is done in reality serves as evidence that Kiev rejects Donetsk and Luhansk," the diplomat noted.

"New proposals provide common ground for joint search [for compomise] based on respect, on equal dialogue, and we will support that," he stated.

Karasin noted that the Contact Group in Minsk and its subgroups have hardly achieved anything significant due to Kiev's political juggling.

"What is happening in Minsk cannot but cause disappointment, because although sub-groups gather for meetings and the Contact Group summarizes the results, we cannot say some significant results have been achieved," he said. "Mostly this is a result of Kiev's political juggling. On the one hand Kiev vows commitment to the Minsk Accords, but in reality it blocks the implementation of these agreements."

While preparing for a meeting of the Contact Group in Minsk planned at the end of this week, the self-proclaimed Donetsk and Luhansk republics announced new proposals on the constitutional reform in Ukraine. A month ago, the republics already put forward several conditions. Their positions has not been described in more detail - DPR and LPR directly confirmed their readiness to remain part of Ukraine and asked Kiev to keep current leaders - Alexander Zakharchenko and Igor Plotnitsky - on their posts.

The diplomat said Russia expects the meeting of the Normandy Four political directors will put pressures on Kiev for the sake of implementing the Minsk Accords.

"We expect that today's meeting will persuade Kiev to move faster towards the implementation of the Minsk Accords of February 12," he said. "The Normandy group gathers for the sake of controlling and analyzing progress in negotiations by the Contact Group and the four working subgroups along the main tracks - humanitarian, security, constitutional reform and political, economic and social affairs."

Karasin said that taking part in today's discussions will be OSCE special envoy Heidi Tagliavini and head of the OSCE's special monitoring mission Ertugrul Apakan.

"They will present their judgements. We may express some wishes and proposals regarding where we should be moving on. We will report the results to the leaders of our countries. In a word, there is no easy and very crucial work ahead," he said.

"Time is ripe for practical decisions. Precious time for moving forward is running out. We must be aware of how dramatic the situation is. The more so, since the leaders of our states met in Minsk last February to accelerate progress. Possibly, by the end of this year we will have an outline of a peace political settlement of the Ukrainian crisis."

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 #33
Izvestia
June 8, 2015
Russian parliament ready to grant Putin right to use troops abroad, daily says
Natalya Bashlykova, State Duma ready once again to entrust president with right to use troops

The State Duma assumes that Kyiv [Kiev] could deliberately scupper the Minsk accords, which would lead to new combat operations and the intervention of Russia. Leonid Kalashnikov, first deputy chairman of the State Duma Committee for International Affairs, believes that if a threat arises to the safety and lives of Russian citizens, parliament could grant the president the constitutional right to use the Armed Forces abroad. This opinion is shared in the Federation Council, where it is believed that Ukraine is seeking to secure the prolongation of the sanctions against Russia at the price of war. At an extraordinary session of the UN Security Council on Friday, Russia's permanent representative, Vitaliy Churkin, stated that the situation in Ukraine could become out of control and have unpredictable consequences.

"A decision to grant the president the right to use troops could be adopted by the State Duma and the Federation Council at any moment, because with every passing day the situation in Ukraine becomes ever more tense; Russian citizens live on the territory of the DNR [Donetsk People's Republic] and the LNR [Luhansk People's Republic], and therefore I accept that the situation could develop according to the Transnistrian [Dniester region] scenario (in 1992, Russia was forced to send in peacekeepers in order to end combat operations - Izvestiya), Leonid Kalashnikov stated.

In his words, today Ukraine is an instrument for weakening Russia that is being skilfully used by Western countries, which are engaged in inciting military conflict and delivering arms.

"There will be acts of provocation on the part of Ukraine, but they will not lead to a major war. Our state today is defended, and the United States will not resort to launching this war," the parliamentarian believes, admittedly at the same time recalling the situation in 1941, when Stalin forbade reacting to acts of provocation against the USSR, and in the upshot all this ended in World War II.

Vyacheslav Nikonov, head of the State Duma Committee for Education, proved to be even more categorical in his assessments.

"I do not rule out that if Minsk-2 is buried, in this case Russia will have grounds to reject the preamble to the Minsk agreements - the guarantees of Ukraine's territorial integrity, and this could be even more serious than military intervention," the deputy believes.

Let us recall that on Thursday the [Ukrainian] Supreme Council adopted a draft law that allows foreign states to be invited to send their troops to carry out international operations in Ukraine. According to the explanatory memorandum, the document "will allow the creation of the conditions for launching an international operation on the territory of Ukraine" by an armed NATO and EU contingent, and this, in turn, should ensure "the earliest possible normalization of the situation and the restoration of law and order, vital activity, and constitutional rights and civil freedoms" in Donetsk and Luhansk regions.

On the same day, the Ukrainian president sent a message to the Supreme Council in which he claimed that there is a Russian invasion and a military threat and also that arms are being delivered from 11 countries, including, in his words, Ukraine's main ally - the United States.

At a press conference on Friday, Poroshenko declared his intention to recover Crimea as part of Ukraine and also threatened inhabitants of the Donetsk Basin with a blockade. Simultaneously with this, the administration of Barack Obama declared the possibility of stationing nuclear weapons in Europe in response to Russia's alleged violation of the treaty on missile testing, and also that Washington could use "additional means" in Ukraine, where fighting with the use of heavy weaponry has resumed. Let us recall that more than 400 people were killed, including civilians, in a recent armed clash in Maryinka, which occurred through the fault of the Ukrainian siloviki [law-enforcers].

"The situation could once again become out of control with unpredictable consequences. We call on the Kyiv authorities to do everything possible to ensure that this does not happen," Vitaliy Churkin, Russia's permanent representative stated yesterday at an extraordinary session of the UN Security Council on Ukraine, noting that Poroshenko needed peace and the Minsk agreements only to regroup his forces.

The Federation Council also regards the situation as tense.

"The main document that is supposed to regulate the situation in east Ukraine is undoubtedly the Minsk agreements. But we see that today official Kyiv is violating both their spirit and their letter, that to all intents and purposes it is shelling peaceful cities and DNR and LNR militia units in a provocative manner, provoking them to retaliatory actions," Federation Council member Igor Morozov noted.

In his words, NATO has today involved the Ukrainian Armed Forces in its exercises both on land and in the air; moreover, it is obvious that the main goals of the Ukrainian military staff are to suppress the freedom-loving people of the DNR and LNR and block the borders from the direction of Russia.

"Therefore I think that in the event of the arrival of the armed forces of foreign states at the borders with the Russian Federation in accordance with the Supreme Council's new law, the option of returning to the initiative that was the basis for Crimea, when the question arose of defending Russian Federation citizens, is possible. This would be a just international operation to keep the peace in east Ukraine," Morozov suggests.

The senator believes that, by dragging Russia into the military conflict, Ukraine and the United States are seeking to secure the prolongation of EU sanctions against the Russian Federation.

"It should not be said that Poroshenko is bluffing. I am convinced that Poroshenko really is preparing to carry out a major military campaign on the territory of the antiterrorism operation. The fact that the Ukrainian Army's forces have already been restored and that the draft of the Minsk agreements was never welcomed by Poroshenko himself point to this. However, the position of the Ukrainian president himself looks highly conditional, because, in my profound conviction, he performs the role of a toy puppet in the hands of the American, British, and other anti-Russian governments," Sergey Markov, head of the Institute for Political Research, believes.

"Petro Poroshenko's statements can be seen both as a provocation, and as a direct threat to the Russian Federation. The problem is that they are the statements of an irresponsible politician who should be put on trial under international law for acts of genocide and crimes against humanity. The only just and available punitive measure for him is confinement for life under guard," military expert Igor Korotchenko, a member of the Russian Federation Defence Ministry Public Council, says, stressing that "Kyiv is provoking the Russian Federation to carry out military operations."

At the same time Korotchenko is absolutely certain that in the event of necessity the Russian president will perform his constitutional duty to ensure the defence of Russian citizens through the forces of the Defence Ministry.

"If the introduction of troops is required, the appropriate measures will be elaborated; the president will perform his duty without fail," the expert clarified.

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 #34
Donetsk notes movement of heavy weapons in Artyomovsk, Krasnogorovka

MOSCOW, June 10. /TASS/. The reconnaissance of the self-proclaimed Donetsk People's Republic has identified redeployment of heavy weapons in the area of Krasnogorovka and Artyomovsk, the spokesman for the republic's Defence Ministry, Eduard Basurin, has said.

"The Donetsk Republic's reconnaissance units continue to identify ever more redeployments of Ukrainian military equipment and personnel," the Donetsk News Agency quotes Basurin as saying. "Two self-propelled artillery pieces 2S5 Giatsint have been registered in the village of Artyomovsk. The location of two self-propelled artillery pieces has been identified between the villages of Krasnogorovka and Zhelannoye Pervoye.

Earlier on Wednesday the Donetsk Defence Ministry said that over the past 24 hours the local communities have come under 41 fire attacks by the Ukrainian military. Two militiamen and six civilians were killed.

Officially the ceasefire regimen took effect in Donbas on February 15. The cessation of hostilities was part of the package of measures for implementing the Minsk Accords. The Contact Group (of the Donetsk and Lugansk republics, the OSCE, Russia and Ukraine) signed the document on February 12. The Donetsk Republic has said more than once that the observance of truce depends entirely on Kiev.

Under the package of measures all artillery pieces with calibers of 100 mm and more should be pulled back 50 kilometers away from the disengagement line, multiple rocket launchers, 70 kilometers, Tornado, Uragan and Smerch launchers and also Tochka missiles, 140 away kilometers. The conflicting parties are to move their weapons back to an equal distance: Kiev, from the current line of engagement, and the Donetsk and Luhansk republics, from the line drawn under the Minsk memorandum of September 19.

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 #35
http://voxukraine.org
June 9, 2015
Ukraine Needs a Smaller and More Humane State
By Anders Åslund, Senior Fellow at the Atlantic Council in Washington

Ukraine is a corrupt state which has among the highest public expenditures in Europe. This situation is aggravated by the fact that Ukraine cannot finance its giant public expenses. Anders Åslund explains what should be done to clean up this mess and achieve economic growth.

Ukraine needs a smaller and better state that delivers more welfare to its citizens and costs them less. In particular, the state must not cause the citizen so much hardship. In 2014, the International Monetary Fund (IMF) assessed Ukraine's public expenditures at 53 percent of gross domestic product (GDP), while the successful countries in this region have public expenditures of around 35 percent of GDP, for example, Lithuania, Latvia, Slovakia and Bulgaria.

The other states have grown nicely and now have a GDP per capita that is much higher than Ukraine's, sometimes up to three times (Poland and Estonia), while Ukraine's GDP per capita has tragically fallen by one quarter since 1990 according to World Bank statistics¹. Clearly, Ukraine is on the wrong track, and its excessive public expenditures are a prime issue.

Nobody questions the need for a state in modern society. It is needed for the defense of its citizens, the provision of law and order, infrastructure, healthcare, education, pensions and some social benefits. But this does by no means imply that a bigger state is better. The United States has public expenditures of about 35 percent of GDP, while in wealthy and well-organized Singapore public expenditures constitute only 25 percent of GDP.

Many "services" states may offer are not desired. The traditional feudal state offered many privileges to the lords, such as the right to decide over their employees, monopolies and subsidies, not to mention the right to judge their subordinates in their own feudal courts. The Ukrainian oligarchic state has many similarities with the feudal state. The courts work to the benefit of the wealthy and well-connected rather than defending the population with the rule of law.

The modern social welfare state has encountered another problem. A majority of the population has repeatedly voted to transfer a substantial share of the wealth of the entrepreneurs and successful to themselves. Money goes around through high taxation of the wealthy to the majority. In the Scandinavian countries this has functioned without much corruption, but growth slowed down because of the high tax burden and limited incentives to work. Therefore, these countries have sharply curtailed both public expenditures and taxes in the last two decades. In Ukraine, the situation is even worse. The oligarchs have enriched themselves with state subsidies, notably in the energy sector.

Ukraine has ended up in the worst of all worlds. First of all, it has among the highest public expenditures in Europe, competing with France, Sweden and Denmark. Second, it has one of the most corrupt states in Europe, so it does not even offer the most elementary public services such as law and order, not to mention good education and health care. Third, its high public expenditures have forced the country to impose the highest taxes in the region, which further aggravate corruption and hinder growth and entrepreneurship. Finally, Ukraine cannot finance its giant public expenditures, but goes from one fiscal crisis to the other, now enjoying its tenth IMF program in just over two decades.

This cannot continue. Ukraine must start cutting its public expenditures drastically, from 53 percent of GDP to 35 percent of GDP, if it aspires to become a normal market economy that can grow.

In comparison with other countries, Ukraine stands out for two forms of public expenditures. One is energy subsidies that accounted for 10 percent of GDP in 2014. A normal market economy should have no energy subsidies, so this is harmful waste that should be eliminated as soon as possible.

The other is pensions that peaked at 18 percent of GDP under President Yanukovych, which is more than twice as much as the European average. If the energy subsidies are eliminated, and the pension expenditures halved as share of GDP, Ukraine's public expenditures would decline to 34 percent of GDP and the proportions of state expenses would look normal. Ukraine does not need to cut expenditures on education, health care or road construction, though the whole state should be made more productive and efficient.

Technically, the easiest task is to abolish energy subsidies. Most of these subsidies are price differentials between very low consumer prices and high import prices for gas from Russia. In 2013, the Ukrainian state paid its own state producers of gas $50 per 1,000 cubic meters, while Gazprom charged about $400 per cubic meters. Needless to say, much of the domestically produced gas was diverged to the private market to the great benefit of some who were close to President Yanukovych. This cannot be stopped through more effective policing because the gains from these rents are too high. They will only end up with somebody else.

If all energy prices are unified at the market level or the marginal price level, no more energy subsidies are needed. All other postcommunist countries have done so, but Ukraine has continued to nurture its energy traders, most recently Dmytro Firtash and Sergey Kurchenko. Such public expenditures make no sense whatsoever and should be abolished as soon as possible. On April 1, the current Ukrainian government took a great step in that direction raising all energy prices to at least half their cost. It would have been desirable to take them further, but the IMF assessment is that this will reduce energy subsidies by 6 percent of GDP. In addition, the lower international energy prices should shave off another 2 percent of GDP of the energy subsidies leaving only 2 percent of GDP.  Then, the government can afford to compensate the poorest third of the population fully in cash to the cost of 2 percent of GDP.

To reduce the excessive cost of pensions is more complicated and demands more time. To begin with "special pensions" to the old Nomenklatura should be abolished or at least sharply scaled down. Many Ukrainians benefit from early pensions that should be tightened up. Most European countries have a retirement age of 67. If Ukraine insists on the current very low retirement ages of 57 for women and 60 for men, most pensions will go to relatively young people who still work and not to the poor and sick. In the longer run, Ukraine needs to adopt a pension reform that offers a minimum pension for all, but then offers higher pensions for most based on private savings. This would also enliven the morbid Ukrainian financial markets and encourage savings for investment. At present, Ukrainian pensions are falling sharply, but they do so because of the absence of indexing in the face of high inflation. The cost of pensions has to be reduced, but this is the most socially unjust way of doing so.

The conclusions are plain and clear. Ukraine needs to sharply reduce its public expenditures in the next few years in order to achieve economic growth. The first and biggest step is to abolish energy subsidies of 10 percent of GDP. The second big step is to trim the pension costs over a few years by 9 percent of GDP. No dramatic costs cuts are required in other areas.

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#36
The Nation
June 9, 2015
Ukraine Is In Crisis. Here's Why the West Can't Save It.
A video roundtable explains why the IMF, Europe, and Western corporations don't have the country's best interests at heart.
By Alexander Reed Kelly
Alexander Reed Kelly is an assistant editor at Truthdig.
[Videos here http://www.thenation.com/article/209329/ukraine-crisis-heres-why-west-cant-save-it#]

Nearly a year and a half after the Euromaidan protests ushered a new government into power in Kiev, Ukraine is still in trouble. Some 6,200 people have been killed, more than 15,000 wounded, and 1.2 million internally displaced in a civil war that had by mid-March, according to the new president, Petro Poroshenko, destroyed "around 25 percent of the country's industrial potential."

The country's economy is out of control: Trending downward since the end of 2013, Ukraine's gross domestic product is declining at a massive, accelerating rate. The World Bank says GDP will contract by as much as 7.5 percent during 2015. During 2014, the amount of money brought in on exports dropped by 40 percent, and between the beginning of 2014 and spring of this year, the goods and services available in the country became nearly 50 percent more expensive as the currency used to pay for them lost two-thirds of its value.

Ukrainians need rescuing. The question is: Can the policies favored by the new government save them?

After endorsing the anti-government protesters that filled the streets of Kiev in November, 2013, the United States gave its blessing to a change of government in the following February, one year ahead of Ukraine's scheduled democratic elections. The government that rules from Kiev today is therefore distinguished from its predecessors by its distinct amenability to US interests-and dramatic coolness to Russian concerns.

In a sign of this shift, on June 27 of last year, this government, led by Poroshenko and Prime Minister Arseniy Yatsenyuk, signed the Ukraine-European Union Agreement-the rejection of which by the previous government had precipitated the protests. The EU agreement reorients Ukraine's political, economic, and military activities toward those of Europe (and by association, the United States) and has become one of the chief instruments of Western influence in Ukrainian affairs.

The other instrument is an agreement with the International Monetary fund to receive $17.5 billion in bailout loans in exchange for key changes to Ukraine's economic policy. By accepting this deal, Ukraine effectively forfeited its sovereignty, handing over to foreign governments the power to write its own laws. These loans are attractive to Ukraine because at the beginning of 2015 it lacked the money it needed to make payments due during the year on existing foreign debts. If Ukraine defaulted on those payments, it would risk losing the ability to borrow the money it needs to support its national budget-money which for a variety of reasons it is unable to generate itself.

So Ukraine is hard up, unable to help itself and in no position to make demands. This development, say many scholars and experts, means that this crisis has become an especially attractive opportunity for foreign interests looking to expand their wealth, property holdings and geopolitical influence. Writing and speaking from the margins of the discussion, these experts say that the policy solutions proposed by the West through the economic agreement and the IMF loans threaten only to deepen Ukraine's troubles-and with nuclear powers struggling on either side, they risk a world war.

In an effort to get a clearer view of these developments and a sense of their probable outcomes, I asked three experts to join me for a video-recorded discussion in the Brooklyn office of Verso Books. They are Michael Hudson, a former balance-of-payments economist for Chase Manhattan Bank, distinguished research professor of economics at the University of Missouri, Kansas City, and an author of a major study of the IMF; Jeffrey Sommers, associate professor of political economy at the University of Wisconsin-Milwaukee and a visiting lecturer at the Stockholm School of Economics in Riga; and James Carden, a former adviser to the State Department on Russia and a regular contributor to The Nation. The three videos below are excerpts from our discussion.

Putin's role in the current showdown between Russia and the West has no doubt been significant, but his actions have also been grossly distorted by the government propaganda and biased media of Western Europe and the United States. Hudson, Sommers, and Carden regard him with the same skepticism they would any contemporary leader, but here they are chiefly concerned with understanding what is driving Western involvement. They recognize, for instance, that Ukraine possesses an abundance of natural resources that, if developed, could produce vast fortunes for whoever held the claims of ownership. This includes reserves of oil, natural gas, and minerals, including uranium-the fuel for nuclear reactors and bombs. Two-thirds of the country's surface is covered with a nutrient-rich "black earth," soil which, despite being poorly utilized, has made Ukraine the world's third-largest exporter of corn and fifth-largest exporter of wheat. US agricultural corporations Monsanto and Cargill have made no secret of their interest in this land.

Western energy interests have similarly worked to position themselves to gain access to Ukrainian petroleum. In spring of 2014, three months after the pro-Western government came to power, the Ukrainian energy company Burisma Holdings announced that Hunter Biden, son of US Vice President Joseph Biden, had been appointed to its board of directors.

These resources would become available to international interests mainly through the changes to Ukrainian economic policy prescribed in the Ukraine-European Association Agreement President Poroshenko signed in June 2014. But raw resources are not the only prizes sought by Western statecraft.

Formed immediately after the end of World War II to finance the reconstruction of Europe, the International Monetary Fund has operated for seven decades with a mandate to help develop the economies of less-than-wealthy nations by organizing and administering loans from creditors around the world (though mainly from the United States and Europe). The IMF offered its current package of loans to Ukraine under the pretense that, in addition to enabling the government to pay its debts, the terms that come with them will help develop the national economy and bring about needed reforms, including some aimed at cleaning up the government's notorious culture of corruption. Hudson says these loans amount to little more than a tool for keeping the country "on a short debt leash"-a form of servitude that empowers the United States to use the Ukrainian government as an extension of US political, military and economic power. But we don't need to begin with Hudson to realize that the IMF program won't help ordinary Ukrainians. President Poroshenko himself told Ukrainians that neither the loans nor the reform would help them.

"Life won't improve shortly," he said in mid-March, shortly after the fund approved the loans. "If someone understands the reforms as improvement of people's living, this is a mistake."

Sommers sympathizes with Ukrainians who want to believe that joining the West would raise their standard of living to that which became standard throughout the United States and much of Europe in the post-war period. But that's not likely to happen, he says, because the policies being "offered" to Ukraine are the "exact opposite" of those that made Europe prosperous after World War II.

Indeed, certain reforms will make essential goods far more expensive for Ukrainians. In the name of bringing the price of oil in line with that sold on European markets, state subsidies for cheap heating oil will disappear. Estimates say the price of gas will rise 280 percent by 2017. Ukrainians who recognize this are not pleased.

"I'll just have to stop eating, I guess," 77-year-old pensioner Valentina Podenko told Business News Europe earlier this year. "I didn't know [the gas charges] will increase, especially by that much."

Life won't simply get more expensive; the state may also lose its assets and the industries it operates and owns. In the event that the country can't pay back the money it borrowed, the IMF-through "conditionalities" stipulated in the agreement-may legally seize ownership of those assets, selling them off to foreign bidders in waves of privatization. Loss of these industries will mean the loss of revenue sources-which will mean less money available to the government to pay its budget and support its operations, including social welfare programs. Hudson warns that with its major source of independent funding gone, the government will be forced to go further into debt to pay its bills. Ukraine will thus become a permanent debtor until its foreign owners relinquish control or another political revolution occurs.

Some number of Ukrainians will have the means to uproot their lives and pursue better conditions elsewhere. As the country deteriorates along the well-tread lines of austerity, social unrest and armed violence, large numbers of the skilled and educated can be expected to flee.

Outsiders may think this crisis has no significance for their lives. They are wrong. The states that are opposed in this conflict are modern, industrialized, and nuclear-armed, therefore many experts recognize the whole crisis as the most dangerous global political and military development since the end of the Cold War. Following the collapse of the Soviet Union in 1991, the United States spent nearly a quarter of a century as the world's economic and military superpower, opposed only occasionally by militant groups operating out of third-world nations. Conditions have changed since then, and now the United States finds itself locked in a potentially existential battle with a highly organized nuclear power.

At present, four months into a largely successful cease-fire between the government in Kiev and the rebels in Ukraine's east, it might appear that the risk of outright war between the Western powers backing Kiev, and Russia, which backs the rebels, has diminished. But preparations being made by governments on either side suggest otherwise.

In keeping with a stream of antagonistic remarks toward Moscow by US President Barack Obama and British Prime Minister David Cameron, NATO's top military commander, Philip Breedlove, has urged armed responses to nearly every movement the Russian military has made since the region was destabilized upon the fall of President Viktor Yanukovych's government.

Claiming an increase in Russian military activity along their borders, the Nordic countries-Norway, Sweden, Denmark, Finland, and Iceland-in April announced their intent to form a military alliance to oppose "Russian aggression," which they called the "biggest challenge to European security." On the same day it was reported that Poland would spend $44.6 billion modernizing its arsenal with a new missile defense system, attack helicopters, submarines, armed vehicles, and drones.

Observers on all sides are eager to assign blame for the danger these developments represent. The prevailing view among Westerners-and Western-looking Ukrainians-is that Putin provoked Ukraine's new government, and by extension, the West. Putin has left no doubt about his willingness to use force (in March he told reporters he was prepared to use nuclear weapons if the fighting on his border spiraled out of control), but where is the evidence that Putin started the conflict? Western leaders claim he fired the first shot, so to speak, when he sent Russian soldiers into the Crimean peninsula after the change of government in Kiev. What they don't mention is that the United States has been meddling in the affairs of eastern Europe for decades.

This interference has taken two forms: The steady expansion of NATO military bases eastward into former allies and members of the Soviet Union (a development that violates a promise made by US President George H.W. Bush to Soviet President Mikhail Gorbachev) and the funding of "pro-democracy" initiatives in former Soviet allies and members like Ukraine, where, since the end of the Cold War, the United States spent $5 billion on efforts to turn the country's politics in its favor. During the height of the Maidan protests, just before the fall of Yanukovych, top US State Department officials Victoria Nuland and Geoffrey Pyatt were caught on tape deliberating which potential replacement would best serve US interests. Less than two weeks after Ukraine's old government was driven from power, Nuland and Pyatt's pick-Arseniy Yatsenyuk-was seated in the prime minister's chair.

The transfer of control over Ukraine to an aggressively pro-Western regime thus constitutes the successful culmination of years of work by US officials. Indeed, Carden suspects that the invitation for Ukraine to join Europe's economic association will serve as a means to expand NATO's jurisdiction through Ukraine and up to Russia's western border. "With all the trouble that the European Union is having digesting its newest members," he asks, why would they want "to bring on a basket case like Ukraine?" From the Russian perspective, NATO's old Cold War goal-of encircling Russia with its forces-is being achieved.

American officials want the world to believe that Ukrainians are locked in a battle for liberation from Putin, that Russian military activity in east Ukraine is part of a plan to recover Ukraine for the benefit of Russia, and that Europe and the United States are offering Ukrainians freedom, democracy, and a shot at life in a "free market." They do not add, as Sommers does, that the Russians who inherited the collapsed Soviet Union also hoped Russia and the United States would become economic partners. They looked to the United States for help with development, but were disappointed. This unfortunate result is consistent with the policy of Carter-era national security adviser Zbigniew Brzezinski, which states that the United States should treat any country that is economically self-sufficient as a military threat. Washington thus supported the anti-Russian Maidan movement in Kiev, Hudson says, in part to undermine and further isolate a Russia that, under the leadership of Vladimir Putin, had recovered both its self-sufficiency, its pride, and-in the US view-its obstinance.

American officials certainly do not admit that Russia's behavior in this conflict is very similar to the United States' in the Cuban Missile Crisis of the Kennedy era, when Washington reacted belligerently to Soviet premier Nikita Khrushchev's attempt to put a nuclear missile base in Cuba. With Ukraine on track-via the association agreement signed by President Poroshenko in June-to become a host NATO forces, and with US officials and Western military leaders frothing at the mouth, Russia is understandably anxious over the possibility that a former adversary will once again become an open enemy. As a result of this struggle, Hudson, Sommers, and Carden caution, Ukraine, Europe, and the rest of the world are becoming less rather than more secure.

These videos were produced by Endless Picnic.
 

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 #37
www.foreignpolicy.com
June 10, 2015
It's Time to Kill the Feel-Good Myth of Sanctions
Isolating bad actors is a mainstay of U.S. foreign policy. But it hasn't worked against Putin - and in an increasingly connected world, it's less and less likely to make a dent.
BY SUZANNE NOSSEL
Suzanne Nossel is executive director of the Pen American Center and a former deputy assistant secretary of state for international organizations at the U.S. State Department.

At the Group of Seven conference over the weekend, U.S. President Barack Obama scored a victory in shoring up the G-7's fragile consensus for continuing sanctions to punish Russia for its shenanigans in Ukraine. The agreement, which stipulates that the sanctions will continues until Moscow decides to respect Ukraine's autonomy and the terms of a cease-fire accord are fully enacted, offers a temporary shot-in-the-arm for a policy approach that looks increasingly infirm. For though the impulse to isolate countries economically and diplomatically in order to punish errant deeds and impel better behavior - it has become a cornerstone of U.S. policy on Russia, Syria, Iran, North Korea, and elsewhere - is nothing new, it has taken on added importance in this era of hesitancy toward foreign military intervention. As the fraught G-7 deliberations over extending sanctions on Russia shows, isolation now goes against the grain of a globalized world; it's hard to implement effectively and even harder to sustain over time. If it is to remain a useful diplomatic tool, policymakers need to adapt to its increasing limitations.

International diplomats and strategists have long had a fascination with isolation as a cure for geopolitical ills. In the late 1800s "splendid isolation" was a vision aimed to keep Great Britain free of entanglement in European affairs. As the world grew more connected, however, the prospect of a major country remaining aloof from global politics became more far-fetched. During the 20th century, as America's growing power and global interests ruled out the isolationism George Washington had extolled, isolation morphed from being a technique by which a country sequestered itself to a tactic for quarantining others. In the post-war period, isolation in various forms became a tool to try to influence nations such as Cuba, North Korea, Iran, Iraq, Burma, Libya, and Sudan. Though the United States never fully subscribed to the measures, the international isolation of both Rhodesia and South Africa during the 1980s was widely credited as a key catalyst to ending white minority rule.

The appeal of isolation is obvious. It offers a geopolitical equivalent of a social pattern as common to the kindergarten playground as to the United States Senate (and whatever may be in-between): When people misbehave, treat others poorly, or break rules, they are shunned and censured. The act of isolating is a way to express disapproval through deeds, not just words; it inflicts a visible punishment and discourages others' bad behavior. Moreover, it also averts contentious interactions between parties in conflict. And, at least sometimes, isolation can prompt the transgressor to recant and repent in order to win his or her way back into favor with the group.

In geopolitics, the theory also holds that the costs of isolation can weaken a regime to the point where internal opponents have a better shot at wresting away control. In response to a major international infraction - invading a neighbor, pursuing nukes, or perpetrating war crimes - isolation offers a compelling alternative to military reprisals, with the costs and risks they entail.

The Western effort to isolate Russia over the last year offers a vivid illustration of isolation's perks, but also its pitfalls. When Vladimir Putin annexed Crimea and mounted a proxy war in eastern Ukraine, NATO was caught off-guard. There was outrage at a brazen expansionism that violated the most basic premises of the post-World War II order, but an equally powerful instinct that launching a war to push Russia back would be folly. Isolation offered a way to make clear that the United States and Europe rejected Russia's actions without being drawn into armed conflict.

After claiming Crimea, Russia was promptly booted from the G-8 (turning it, once again, into the G-7). Between March and August, the United States, European Union, Japan, Australia, and others implemented successive rounds of sanctions that targeted energy, finance, trade, and defense ties, as well as individuals linked to Putin and his Ukraine policy. Though in April 2014, an EU factsheet declared that the "sanctions are not punitive, but designed to bring about a change in policy," in July of that year, as Obama announced stiffened measures, he heralded the sanctions as proving that "the United States means what it says." He blamed Russia for "isolating itself from the international community."

The sanctions have undoubtedly had an impact. The economic damage inflicted on Russia has been palpable; compounded by the damage wrought by a steep drop in global oil prices, the country's Standard & Poor's credit rating dropped to junk status earlier this year. The ruble plummeted by more than 50 percent during the second half of 2014 and a rebound is now faltering as sanctions look more likely to be extended. Late last year, the Russian economy was projected to shrink by more than 4 percent in 2015 and judged likely to remain in recession for 2016. In Britain, former Foreign Minister Malcolm Rifkind touted a new blacklist of officials no longer permitted to travel to Russia as proof that Putin is hurting.

For all the bluster, however, the policy tendered was less than the sum of its parts. Putin responded to sanctions not with contrition, but with counter-sanctions. Obama's reference to the international community isolating Russia was in large part wishful: China, India, Brazil, South Africa, and other non-Western nations never seriously considered following Washington's and Brussels' lead.

Most importantly, measured against the EU's stated objective of prodding a shift in Moscow's Ukraine policy, isolation earns poor grades. Russia failed to uphold its end of the Minsk II cease-fire, an accord negotiated in February that was meant to end the conflict in the Donbass region of Ukraine. In recent weeks, new evidence has emerged to substantiate Western claims of direct Russian involvement in stirring renewed violence in eastern Ukraine. Moreover, slowly recovering oil prices coupled with deepened economic ties to China, India, and others - efforts by Moscow to thwart the impact of current and potential future Western sanctions - may mean that the initial pain of sanctions will gradually wear off. A recent World Bank forecast says Russia's economy is now looking up.

If anything, sanctions seem to have galvanized Putin in pursuing a spate of policies - everything from creating his own credit agency to financing European green parties that will oppose fracking and compound dependency on Russian oil - aimed to thwart his antagonists and undermine their efforts to isolate him.

With no sign of Russia knuckling under, the question becomes, how long can the sanctions and isolation continue and to what end?

Fissures have opened within Europe as countries, such as Italy and Greece, whose economies have suffered from lost European trade with Russia (a deficit estimated by Spain's foreign minister at $23.7 billion as of February of this year), have begun to question the policy. The EU can only extend sanctions with the consensus of its 28 members, meaning that each country enjoys a potential veto. U.S. Secretary of State John Kerry's trip to meet with Putin two weeks ago for talks - mostly on Syria - was widely seen as a mark that Washington could ill-afford to not be on speaking terms with the Russian leader. (As Kerry put it, "there is no substitute for talking directly to key decision-makers.") And last week, the Pentagon turned to Congress to plead for the easing of sanctions that bar the import of Russian rockets essential to the most technologically advanced U.S. defense and intelligence programs. Diplomatically, while Russia may be left out of the G-7, it remains part of crucial international forums including the six-party talks to end Iran's nuclear program. While Russia is not in the international coalition fighting the Islamic State, Iraqi Prime Minister Haider al-Abadi visited Moscow in late May to ask Putin to get more involved.

While the EU agreement to extend sanctions beyond the current late July deadline is being treated as an important litmus test of Western unity and purpose, it is unclear whether the patience of Putin and his people will run out faster than that of the Pentagon and the wavering members of the EU.

Though the Russian case is the highest stakes example of a policy of isolation coming under pressure, it reveals trends that will shape the viability of isolation efforts more broadly. Countries with modest global economic footprints, limited geopolitical significance, and few friends - including today's North Korea, pre-2011 Burma, and 1980s Rhodesia - are still relatively easy to isolate. Broad coalitions can be amassed to support the measures with limited sacrifice of national interests. But beyond those rare examples, cutting off one country inevitably has repercussions in a global economy. While major powers that see themselves as guarantors of international peace and security may be willing to absorb those costs, the calculus for smaller fringe European nations is different, rendering the EU's consensus-based decision-making structure a major hurdle. Moreover, in a world of global supply chains, countries threatened by isolation can more easily realign their trade relationships and gird themselves against punishment. As in the case of Russia and China's thickening ties, this can work to undercut Western leverage over time, meaning that isolation tactics are even less likely to bear fruit in future.

Globalization and the rise of transnational threats in particular also cut against diplomatic isolation. While Russia's global diplomatic and political influence make isolation virtually impossible, efforts to cut off Iran and Syria have also been bedeviled by the need to engage them both in the fight against the Islamic State. Some analysts also maintain that the U.S. policy of isolating Iran proved a weakness in the campaign against al Qaeda in Afghanistan after 9/11.

On top of all this, there is mounting evidence that isolation often simply doesn't change countries' behavior. Obama's decision late last year to reestablish relations with Cuba acknowledged what had been obvious for decades: Isolation hadn't reshaped the behavior of the Castro regime. Western countries and the Arab League isolating Syria in response to President Bashar al-Assad's brutal crackdown beginning in 2011 did not deter him in the least, and actually prompted both Iran and Russia to step up in his defense.

Yet some former Obama administration officials have argued that sanctions helped bring about the election of President Hassan Rouhani in 2013 and the opening of nuclear negotiations shortly thereafter. To the extent this played a role, the Obama administration's success in 2010 in securing a stiffened regime of U.N. sanctions - obligations shared by all countries in the United Nations' system - supports the idea that when isolation works, it is because it is as multilateral as possible. In a world where U.S., EU, Russian, and Chinese interests seem to increasingly diverge, the possibilities for universal, U.N. Security Council-sanctioned sanctions will never be the norm.

Except in those rare cases of broad international consensus, attempts to isolate can boomerang back at those trying to inflict the punishment, casting them as self-important and overbearing. The U.S. embargo on Cuba has damaged Washington's relations with virtually the entire hemisphere, fueling the rise of anti-American leaders in places like Ecuador and Venezuela and making it impossible to contemplate stronger regional integration. In Russia, Putin has treated the West's cold shoulder as a badge of honor, using it to rally public opinion and burnish his own popularity.

Obama and German Chancellor Angela Merkel might know that isolating Russia may well be futile in the long run; without strong policy alternatives, sanctions allow leaders to signal resolve without having to come up with elusive new measures. A forthright acknowledgment of the constraints of isolation would force a more considered and realistic approach toward countries that break rules. To begin this process, the United States and its allies should acknowledge that isolation and partnership are usually not binary alternatives. Except in the case of small, unimportant countries, Washington and Brussels have too many diverse interests to declare entire sovereign nations economically, politically, and morally off-limits.

In the case of Russia, the United States and its European allies need to recognize that - at least as long as Putin is in power - Russian behavior won't be shaped by carrots and sticks. Instead, Western leaders should offer a hard-headed, compartmentalized relationship where, issue-by-issue, the West and Russia will cooperate where possible and confront one another where necessary - an isolation that is more tactical than principled, in which the rules will be reworked in accordance with their own interests. This will help avoid the Catch-22 of trying to diplomatically isolate a country essential to some of America's and the EU's most pressing diplomatic objectives. This also can help avoid a scenario where every concession to necessity can be cast as capitulation and retreat.

Part of the shift will be rhetorical. Rather than promising to isolate Russia entirely, something the United States and its allies cannot achieve without the support of China, Brazil, India, and others, the administration could pledge to keep its distance, justifying Russia's exclusion from forums of the like-minded such as the G-7 (a place where Moscow arguably never belonged) but not implying that cooperation elsewhere will cease. While a more variegated approach might undercut the note of principled censure implied by wholesale isolation, moral condemnation is a role better suited to civil society groups, intellectuals, and advocates than it is to governments.

Western leaders should also acknowledge that isolation tactics are time-bound, and other measures aimed to safeguard Western interests need to be implemented while they're in effect. In this case, that means upgrading the defenses of NATO states on the Russian periphery; strengthening the ability of the Ukrainian government to govern, rebuild its economy, and defend itself; and mobilizing China, India, Brazil and others to call out Russia's ongoing destabilizing role in Eastern Ukraine. These measures will help avoid a scenario in which sanctions run their course and no alternative source of leverage is available to replace them.

Acknowledging that comprehensive, long-term isolation isn't feasible also means shaping isolation measures so that they are sustainable and effective. Sanctions targeting individuals and corporations, including those that have restricted the movements and assets of members of Putin's inner circle are easier to maintain - they have fewer repercussions for sanctioning governments and innocent populations. Most regimes on the receiving end of sanctions are authoritarian states that concentrate power in very few hands that wield inordinate power. By confining sanctions to those most tightly tied to violations, Western nations can minimize collateral damage, including for themselves.

Still hungover from U.S. military interventions in Iraq, Afghanistan, and Libya, yet not wanting to appear hamstrung in the face of breaches of international order, the United States and its allies have seized on isolation as a resolute and right-minded strategy for dealing with miscreant states. But to take full advantage of the potential of isolation, the West needs to face up to its limitations.

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 #38
Euromaidan Press
http://euromaidanpress.com
June 9, 2015
12,000 pages of laws should be passed to align Ukraine with EU legislation
By Robin Molnar
Robin Molnar, aka Robintel, is a peace-mongering global citizen that writes from Romania

Is Ukraine on track for the EU? Of course, there are multiple indicators that measure EU's Eastern Partners' progress towards one day joining the European Union of free trade and labor and, since these indicators are usually complex, one may resort to just one: the amount of laws the national parliament has passed in order to harmonize the Ukrainian laws with the EU ones.

From Romanian experience, there were over 8,000 pages of laws and annexes that needed to be passed and this was no easy feat, especially given the poor quality of the elected parliament, as expressed monitoring by media and NGOs.

However, due to specific complexities, Ukraine may have to pass around 12,000 pages of laws, to address some issues that Romania didn't have. So, while there is consistent parliamentary progress towards reforms, it may still be too little, too slow for a hypothetical EU admission by 2025.

Yes, the intentions are good, but more doing, more acting-upon is required, in order to align Ukraine with the EU legislation. Without this, there is and there will never be any EU accession, just partnership and, while the Eastern Partnership is a good thing, it also means that Ukraine has not gone the full length of the deal.

Also, given the difficult situation in Ukraine, passing some of the laws could partly ease the hardships currently endured by the brave people of Ukraine, especially since these are and will be the most difficult five years in Ukraine's recent history, because this adjusting of state power to better accommodate the European will of the people is so radical in Soviet-torn states that even people are not fully aware of their responsibilities.

To be more specific, people tend to put more pressure on the government or on the president, whereas they should mainly press the parliament. Because the EU convergence laws are passed by the lawVerkhovna Rada and no prime minister, no matter how competent, could pass 12,000 pages of laws by ordinance. People need to understand that and to monitor this judicial progress, making sure at least 1,200 pages of laws are updated to EU standards, yearly, before anyone can even start to blame the West.

Without adopting European-grade laws, there is nothing the EU can do to help Ukraine, because no European commitment of the Ukrainian parliament will unavoidably lead to no financial commitment from Brussels.

So, if this generation really wants to be the one that frees Ukraine from its Soviet slavery and brings it home, among the bright states of the European Union, it should do its homework and press the parliament, measuring their progress on legal harmonization with the European Union: 12,000 pages in 10 years. It's doable, but serious work and monitoring need to be put into it.

Obviously, the same goes for Moldova and Georgia. They can be freed as well, but they must monitor their parliaments, too.

Will Moldova do it? Will Georgia do it? Will Ukraine do it?

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 #39
Sputnik
June 9, 2015
Der Spiegel Apologizes to Readers over Coverage of Bellingcat MH17 Report

Under the headline "What we learn from the coverage of the Bellingcat report," Der Spiegel's online edition has published an apology for taking it at face value.

"Among our journalistic principles is the fact that we do not assess explosive news as reliable until we have received it from two trustworthy sources independent from each other."

"If we rate news so explosive that we do not want to withhold it from you, dear readers, even if we could not verify it, then we choose a careful formulation."

But this, the choosing of a careful formulation for yet to be verified explosive news, is exactly what Der Spiegel failed to do at least twice during the initial coverage of the Bellingcat MH17 report.

The article, by Spiegel Online editor-in-chief, Florian Harms, quotes two sentences he wishes the magazine had written using the conditional, instead of indicative mood.

One, is the last paragraph from the very first article Der Spiegel dedicated to the Bellingcat MH17 report: "Yet the Bellingcat experts have now exposed this very [Russian satellite] picture as fake."

The other, is the headline of an article published on the same day, June 1, titled "How Russia manipulated the MH17 evidence." Here too a more cautious formulation in the conditional was called for, admits Harms.

Reading Tea Leaves

Harms justifiably recalls that, already on June 3, Der Spiegel published an interview with image forensic expert Jens Kriese who was quoted, right from the headline, as saying that: "Bellingcat engages in reading tea leaves."

Had his article not already been published, Harns could have added that again, Der Spiegel exposed, on June 5, one of the authors of the by now fully discredited Bellingcat MH17 report as a former Stasi employee.

Seeing as Der Spiegel apologized to its readers for mistakes made in the initial coverage of the Bellingcat MH17 report, we may take that as a sign that they still have some journalistic integrity left.

From "Stop Putin Now" to "How the West Lost Russia over Ukraine"

The MH17 flight crashed on July 17, 2014. Western media rushed to blame not only pro-Russian militias, but, incredibly, President Putin himself. All without a shred of evidence.

Der Spiegel joined this astonishing finger-pointing craze on July 29 when it published its infamous "Stop Putin Now" front cover, with the pictures of the MH17 crash victims in the background.

It caused an uproar in Germany and several readers complained. The German Press Council ruled that the pictures of MH17 victims on the cover had been "instrumentalized in the context of a political statement." Activists threatened a boycott, whilst Der Spiegel actually experienced a significant loss of readership as well as web traffic.

Suddenly, on November 24, a front cover portraying both Putin and Merkel as "Cold Warriors" signaled the change. Inside, a 7,000 word article analyzed the events that led to the November 2013 Vilnius summit, when former Ukrainian president Viktor Yanukovich's refusal to sign the EU Association Agreement prompted months of protests in Maidan, leading to a coup, to the Crimean international crisis and to a bloody civil war in Donbass.

Under the headline "Summit of Failure: How the EU lost Russia over Ukraine", signed, in an unprecedented move, by "Spiegel Staff", the article refused to blame Russia:

"The story of the run-up to Vilnius is one filled with errors in judgment, misunderstandings, failures and blind spots. It is a chronicle of foreign policy failure foretold - on all sides."

It was also rich in revealing details and anecdotes such as: "dripping with disapproval and cool sarcasm aimed directly at the Ukrainian president, Merkel said: 'I feel like I'm at a wedding where the groom has suddenly issued new, last minute stipulations'."

NATO's Dangerous Propaganda

It was just the beginning. Examples of Der Spiegel's newer, more neutral and facts-based approach are many.

In March, Der Spiegel published an article that, as Sputnik and Russia Insider analyst Alexander Mercouris wrote: "..all but accuse NATO's military leadership of lying about the extent of Russian military involvement in Ukraine as part of a plot hatched by hardline insiders in NATO and Washington such as General Breedlove and Assistant Secretary of State Victoria Nuland to undermine the Minsk peace process so as to restart the war in Ukraine with Ukraine this time armed with US weapons."

And now apologizes to its readers - what are, after all - for comparatively 'minor' errors.

Der Spiegel is on its way back to quality journalism. Will the rest of German, and western media, follow?

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 #40
Kyiv Post
June 10, 2015
Thomas Grant: Ukraine has to craft a more comprehensive strategy to get Crimea back
by Mariana Antonovych

How Ukraine can get back Crimea and regain control of the Donbas is the subject of a new book, "Aggression against Ukraine: Territory, Responsibility and International Law," to be released on June 17.

The author of the book, Thomas D. Grant, is a professor at the Cambridge University. He has served as legal adviser to governments, international organizations and corporate clients on numerous cases, including proceedings before the International Court of Justice on maritime disputes, investment and commercial arbitrations.

Grant says a range of different options has to be weighed by Ukraine.

Economic sanctions against Russia should definitely remain part of the mix.

"The majority of the United Nations General Assembly, which represents more than 80 percent of economic output, has joined the collective non-recognition of Russia's acquisition of Crimea," Grant said.

The sanctions make investment in Crimea via Moscow unattractive because any profit could be seized in courts in one of the sanctioning countries.

Meantime, Ukraine's bilateral investment treaties could target those countries, such as China, which did not impose any sanctions against Russia. At the least, Ukraine should examine China's obligations under the bilateral investment treaty.

The three complaints that Ukraine lodged against Russia in the European Court of Human Rights also make sense as part of a broader strategy.

"Obviously, the European Court is an "A" place to go. However, what Ukraine needs to do is to identify every possible legal mechanism that might help," Grant said.

The European Court of Human Rights awarded Cyprus $124 million for Turkey's occupation of the northern part of the island in 1974. Turkey remains there and hasn't paid. The Security Council successfully imposed financial penalties on Iraq's invasion of Kuwait in 1990.

Russia will likely ignore any decision but, over time, the adverse judgments may work. The rulings could also expose Russian state-owned Gazprom and other publicly traded companies to arbitration worldwide.

Drawing the southern borders of the Black Sea at the International Court of Justice is another avenue for obtaining an adverse judgment against Russia.

In 2009, the International Court of Justice established the single maritime boundary delimiting the continental shelf and exclusive economic zones of Romania and Ukraine. However, it did not complete the demarcation.

"The only difficulty is to bring your neighbors - Romania and Bulgaria - to the negotiations table," Grant said.

If Ukraine succeeds, Russia will either ask to join the proceedings as the alleged owner of Crimea or lose.

"I'd say that at the very least the court will have a major headache but ... what you will end up with is a jurisdictional decision, which by implication reaffirms that Crimea is Ukraine," Grant believes.

Under the doctrine established by the European Court in Cyprus v. Turkey, Ukrainian courts also have jurisdiction in Crimea, making investment on the peninsula very risky.

After Northern Cyprus was invaded by Turkey in 1974, lots of property was taken from Greek Cypriots and given to foreign investors. In return, Greek Cypriots went to Southern Cypriot courts that entered judgments against foreign businesses operating in Northern Cyprus.

According to Grant, "some investors have been very badly surprised when they paid very large money damages to Greek property owners under Southern Cypriot courts' decisions in Frankfurt, Amsterdam, London and other courts."

Even the judgments Russia will ignore are going to last and in time become a serious irritant to Russia's foreign policy.

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 #41
New York Times
June 10, 2015
Putin's Warlords Slip Out of Control
By ADRIAN KARATNYCKY
Adrian Karatnycky is a senior fellow with the Atlantic Council.

KIEV - In waging a clandestine war in eastern Ukraine, Vladimir Putin has made a bargain with the devil. He has farmed out much of the fighting to warlords, mercenaries and criminals, partly in an attempt to simulate a broad-based indigenous resistance to Ukrainian rule. But Mr. Putin's strategy of using such proxies has resulted in the establishment of a warlord kleptocracy in eastern Ukraine that threatens even Moscow's control of events.

Surrogate fighters were recruited from four sources: local criminal gangs; jobless males who live on the fringes of eastern Ukraine's society; political extremists from Russia's far right, including Cossacks; and itinerant Russian mercenaries who fought in Chechnya, North Ossetia, Transnistria and other regional conflicts in the post-Soviet Union. They have been trained and equipped with modern weapons, and are often supported by Russian regular and special troops.

These irregular forces now form the backbone of the armies of Donetsk and Luhansk, two mostly Russian-speaking regions of Ukraine along the border with Russia. Those separatist enclaves are dominated by well-armed criminal networks whose leaders play key roles in local politics, both formally, as government leaders, and informally, as chieftains of gangs with their own turf. These men and women have supplanted the pro-Russian elite that had held sway in the area since Ukraine's independence in 1991.

By striking a bargain with what are, in effect, local warlords, Mr. Putin is recreating a model Russia first tried in Chechnya more than a decade ago. There, the Russian government made common cause with Ramzan Kadyrov, the son of a prominent Chechen mullah turned separatist president. Mr. Kadyrov, whose clan had once backed the indigenous independence movement, switched sides in 1999 and, with Russian help, seized power in Chechnya. Chechen resistance was defeated, as the Kremlin had hoped, but at the cost of letting a local warlord with his own powerful army gain near-total sovereignty.

While Mr. Kadyrov regularly pronounces his personal loyalty to Mr. Putin, he brooks no intervention from federal Russian authorities. He flouts Russian law, for example by permitting polygamy. On April 21, he stated his sovereignty with clarity, telling his fighters that if any security officer, "whether from Moscow or Stavropol, appears on your territory without your knowledge, shoot to kill. They have to take us into account."

The Kremlin is now repeating its reckless policy from Chechnya in eastern Ukraine, with similar results. Although the leaders of Donetsk and Luhansk rely on training and arms from Russia, their crime-based financial independence also gives them incentives to play their own game.

Their influence comes from the trade of weapons, drugs and alcohol, and cash generated from checkpoints on roads. New criminal fortunes are being made through corporate raids, shakedowns of local businesses and the seizure of houses abandoned by residents who have fled the region: As of last month, there were more than 1.3 million internally displaced people inside Ukraine, with the highest rates in the eastern parts of the country, according to U.N. sources. And there were more than 700,000 Ukrainian refugees seeking legal status in Russia.

The mounting criminality in eastern Ukraine is also spilling over into Russia, with both contraband and irregular fighters crossing the porous borders. Rostov Oblast, a Russian province that is a staging ground for the Russian-backed insurgency in eastern Ukraine, has experienced a huge spike in crime: an increase of more than 23 percent in the first four months of this year. It is now the sixth-most crime-ridden of Russia's 83 regions.

The proliferation of criminality and the emergence of a broad array of well-armed players along Russia's southwestern border have not been welcomed by the Russian security services, which are accustomed to operating under a strict chain of command. In fact, they are suspected of being involved in a spate of assassinations of some troublesome local chieftains, most recently Aleksey Mozgovoy, who was killed in an ambush on May 23. The head of an insurgent battalion in Luhansk, Mr. Mozgovoy had criticized local separatist leaders for giving up on establishing a larger breakaway region that was to be called Novorossiya, or New Russia.

Mr. Putin's war in Ukraine has brought death and mayhem to Ukraine, and sanctions, political isolation and an economic downturn to Russia. It has also brought instability to the vast swath of territory that runs from the Donetsk and Luhansk statelets of Ukraine to Russia's Rostov and Krasnodar regions, linking up with the Caucasus. Mr. Putin's war in Ukraine, in other words, is slipping out of his control.

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 #42
The Asian Age (India)
www.asianage.com
June 10, 2015
Ukraine's troubled geography
By S. Nihal Singh
Columnist

Western support has led the rhetoric of Kiev to a stridently pro-Western and anti-Russian pitch... Yet a glance at the map of Ukraine and the adjoining Russian Federation will highlight the absurdity of these two countries living as enemies.

The crisis over Ukraine is worsening, but it is far from clear at this point whether it will lead to a Western rethink on integrating the country into its sphere of influence. The outcome of the two-day summit of Group of Seven (from which Russia was excluded for the second year) stuck to its familiar tough formulation. But in some academic circles in the United States and Europe, there is a growing trend that peace can only come if the West recognises the divided nature of Ukraine's leanings. The country is greatly dependent on Russian goodwill, given the pro-Russian inclinations of roughly half its population in the East and its geographical location. Forcing Ukraine to sign on to a Western agenda does not make sense.

Whatever official statements emerging out of Moscow might suggest, President Vladimir Putin and any likely successor will not let the pro-Russian rebels fighting the Kiev forces in the East, where they have set up so-called People's Republics, lose. Geopolitically, it is not only the President but the whole Kremlin power structure that rebels at the large territory adjoining the Russian Federation being co-opted by the West.

Western support from the European Union has led to raising the rhetoric of Kiev leaders led by President Petro Poroshenko to a stridently pro-Western and anti-Russian pitch. Billions of dollars of Western aid are being poured into Ukraine, with the West urging even more help. Yet a glance at the map of Ukraine and the adjoining Russian Federation will highlight the absurdity of these two countries living as enemies.

President Poroshenko was making his pitch on the eve of the Group of Seven industrialised countries' summit. He spoke to President Barack Obama over the telephone resulting in a White House statement supporting Ukraine's sovereignty and integrity, a boilerplate formulation. European Union sanctions are due to end by September.

Understandably, Western ambitions were fuelled by the inevitable chaotic days following the break-up of the Soviet Union and the resulting Boris Yeltsin era. Much of the eastern Europe was then co-opted into the West, including the Baltic states that were until recently part of the Union of Soviet Socialist Republics (USSR). Provocatively, they were not merely taken into the European Union but also the North Atlantic Treaty Organisation (Nato). Thanks to the annexation of the Crimean Peninsula, the home of the Russian Black Sea Fleet, by Russia a year ago, the complexion of the crisis changed.

We are now living in an imitation Cold War atmosphere, with Western sanctions imposed on Russia and Nato forces and military aircraft deployed on Russia's periphery. Meanwhile, we are in the middle of the second ceasefire agreement signed by Russia and Kiev in Minsk last February, supported by the West even as intermittent firing has spilled into more significant fighting between the rebels and Kiev forces.

President Poroshenko has shown no enthusiasm for a federal type of solution in which the regions would have greater autonomy, an idea that would satisfy Moscow inasmuch as it would give the eastern region more room to have closer relations with Russia. The Minsk agreement had envisaged local elections and greater regional autonomy.

There has been no forward movement on the political front, with President Poroshenko asserting that fighting must first stop and the border with Russia brought under full Kiev control. Encouraged by Western rhetoric, Kiev is standing for a strong Centre.

A report by observers of the monitoring team of the Organisation for Security and Cooperation in Europe (OSCE) to an emergency meeting of the United Nations Security Council, on June 5, posed two likely outcomes: either a return to a deepening intractable conflict or a new momentary upsurge. As an aside, President Poroshenko was realistic enough to tell a news conference that he saw no alternative to trying to carry out the Minsk agreement, probably not to sound too belligerent on the eve of the G7 summit.

How long a changing Western academic assessment of the true nature of the Ukraine crisis will take to translate into policies by the major Western powers remains a question mark. But a crucial factor will be Germany's evolving attitude. As the most important leader of the European Union, Chancellor Angela Merkel sets the trend.

Having been brought up in the former Russian-controlled East Germany, she is a Russian speaker and knows Communist psychology well. On Ukraine Ms Merkel's mood was soured by the downing of the Malaysian Airlines passenger plane by suspected Russian-supported rebels, through anti-aircraft batteries supplied by Moscow.

However, Ms Merkel is pragmatic enough to realise that peace with Russia is imperative for the future of the European continent. In her quieter moments, she must know that a Russia sought to be contained by the West through Nato and a ring of Western-aligned nations is a path to conflict, not peace.
True, President Putin is seeking to build his country's influence through his own trade arrangements with nations that were until recently part of the Soviet Union. This is a legitimate aim for the Kremlin leader.

On the other hand, fears of Russia by the Baltic states in particular and other former parts of the Communist scheme of things are not to be derided. Georgia and Moldova, with Russia carving out regions in these states, are living examples of these fears. But surely the answer is not to provoke Moscow by appointing a former anti-Russian Georgian leader as governor of an eastern Ukrainian province by giving him Ukrainian nationality.

It is difficult to predict when cooler heads will prevail in the major Western capitals. Years after the Cold War was supposedly over, it seems ironical that European powers and the United States are playing the old game. The West, particularly the United States and Germany, must realise that they have to take the lead in abandoning policies that are retrogressive. It is counter-productive to humiliate a proud nation that broke up and is seeking to pick up the pieces again. For the immediate future, the outlook for peace will remain bleak.

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