Daily Archives: July 2, 2007

July 2, 2007 — Contents

MONDAY JULY 2 CONTENTS


(1) Another Original LR Translation: Illarionov on Russia’s Future

(2) Annals of “Pacified” Chechnya”

(3) Annals of Russian Racism

(4) Annals of Screwball Yuri Mamchur (yep, he’s at it AGAIN)

Another Original LR Translation: Illarionov on Russia’s Future

La Russophobe‘s original translator offers yet another indispensible installment from the brilliant pen of Andrei Illarionov, who knows the Putin regime from the inside and is the last best hope to save Russia from the ashcan of history. This is the article that formed the basis for Cyrill Vatomsky’s wonderful and devastating critique of the Putin regime which we cross-published yesterday.

Russia Will Not Enter the Top Five Economies By 2020 On Its Current Course

Andrei Illarionov

Yezhednevniy Zhurnal

June 27, 2007

Apparently the intoxicated air of the White Nights and black-tie riverboat dinners played cruel tricks on some of the participants in the recent Petersburg Economic Forum [June 8-10, 2007]. The sheer volume of inaccuracies, distortions and absurdities uttered at the form could only invite humor.

A high bar was set by former president of the World Bank James D. Wolfensohn, who asserted that “since 1995 Russian GDP has increased by five times, after declining by 50% from 1991 to 1995.” One would think that for the former head of the respected international organization there could be no secrets in the statistical data of the world’s countries. But apparently there were.

If the current head of the board of directors of Citigroup has a problem accessing the Internet, then perhaps he could inquire with the statistical department of his own bank, turn to his colleagues at the IMF, or as a last resort take an interest in the work of the Russian Federal Statistical Service. Anyone there would be glad to answer him precisely: from 1991-1995 Russian GDP declined by 34.6%, and from 1995-2006 it grew by 55.6%. It may be that James Wolfensohn is, as [Russian Minister of Economic Development and Trade] German Gref has called him, a friend, but the truth is more valuable.

The switching of concepts in the speech of the Russian President was much more refined: “In the first quarter of this year direct foreign investment in the Russian economy rose by two and half times compared to the previous year. And accumulated foreign investment reached $150 billion.” The listener might have gotten the impression that the last figure related to the direct foreign investment that was mentioned in the first sentence. But that would be incorrect. The $151 billion figure was the total amount, as of April 1, 2007, of all foreign investment – not only direct, but also portfolio (investment in equities and shares totaling less than 10% of a company’s total capital, and the purchase of bonds, notes and other promissory paper), as well as other investments (such as trade credits and credits to the government).

The only true indicator of a country’s attractiveness for investment is direct private investment. As of April 1, 2007 it totaled $73 billion in Russia. This is a significant amount. However, if we compare it with the size of the Russian economy, it looks rather modest – only about 7% of GDP. Not including direct foreign investment in energy the figure is even smaller – just 4.5% of GDP. By way of comparison: in Ukraine accumulated foreign investment exceeds 19% of GDP; in Latvia, Lithuania and Poland it is 25%; in Georgia, 42%; and in Estonia it is 59% of GDP.

Proclamations of a macroeconomic type opened a whole new frontier of humor. “If 50 years ago 60% of world GDP originated in the Big Seven countries, today it is the opposite: around 60% of world GDP comes from countries outside their borders,” continued the Russian President. It is true that in 2006 the share of the Big Seven countries totaled 41% of world GDP. But it is also true that 50 years ago the Big Seven produced not 60% but 51% of world GDP. Hence the reduction in their share of the world economy over the past 50 years declined from 51% to 41%, or by one-fifth – not nearly as sharply as depicted in the Russian President’s speech.

Of course, one could gloat over the decline in the weight of the Big Seven in the world economy. But it would be worthwhile to first consider how the place of Russia itself has changed in the world. In comparison with the Big Seven, the relative weight of Russian GDP over the past 50 years has declined from 12.1% to 6.3%, and in comparison with world GDP it has fallen from 6.2% to 2.5% – that is, by two and a half times. Now that is a shift of a truly tectonic nature. And it is hard to argue with the President when he says that “the world has truly changed, literally before our eyes.”

But even these pronouncements paled against the forecasts. Mr. Wolfensohn “promised” that “the economies of Russia and the developing countries will grow 20 times by 2050, while the developed countries will grow by only 2.5 times.” Even if that could happen, a better illustration of the embellishment “We too ploughed” [TN: said of someone who makes overly much of his modest contribution] could hardly be found. That the economies of China, India and other developing countries may reach the size of the current Big Seven economies has not been a secret to anyone for a long time. The challenge this presents to Russia would be well worth considering.

But there was no time for such considerations in Saint Petersburg. Otherwise the predictions of a twenty-fold growth rate in the economic prospects of Russia could hardly have come to light. For a country with a population that is shrinking at the rate of Russia’s, a 20-fold increase in GDP would require a 25-fold increase in GDP per capita. How could this be achieved even theoretically, if in all of world history there has never been such a rate of growth for a country with a population of more than 1 million souls? The world record holders for economic growth rate, which have come to symbolize “economic miracles”, look much different: over 43 years, the growth rate in Japan in per capita GDP was 10 times; in Korea – 12 times; in Taiwan – 13 times; in China – 17 times.

If one were to rely on the official forecasts of the World Bank and IMF, then even extrapolating a continuation of the unprecedented high growth rate of the past few years for the world economy, the GDP growth rate in the developing countries by 2050 is unlikely to exceed 8 times, while that of the developed countries would be five times.

The height of pseudo-scientific futurology was achieved in the presentation by Russian First Vice-Minister Sergei Ivanov: “By 2020 Russia’s GDP will place it in the top five economies of the world”, and “Russian per capita GDP in terms of Purchasing Power Parity (PPP) will amount to $30,000 on the basis of 2005 prices.” First Deputy Prime Minister Dmitriy Medvedev agreed with this assertion.

Alas, the promises made by the candidate-successors [to President Putin] will never come true. And not just because in order for the per capita GDP per person in Russia to reach $30,000 it would have to reach 50% of the per capita GDP of the most developed countries of the world (especially the U.S.), which has never happened in 150 years of Russian history. And not even on the doubtful basis of extrapolating a constant high growth rate for Russia and low growth rate for Europe.

The problem is that higher economic growth rates require a completely different institutional environment. The growth rate depends not only and not so much on the volume of investment – international or domestic – as on the condition of social and government institutions – private property rights, division of government powers, freedom of mass media, independence of the judiciary, civil rights, political rights, and legal order.

World history knows of not a single case in which a country not having energy revenues and being unfree (in the sense of political rights, civil freedoms, legal order and defense of property rights) achieved a GDP of even $17,000 per person. For countries with energy revenues the insurmountable barrier has been somewhat higher, but is nonetheless far short $30,000.

Alas, present-day Russia is just such an unfree country, and the situation with its key social and governmental institutions excludes the possibility of its entry into the group of the most developed countries.

The Russian economy might have grown more quickly on account of its oil industry, but as a result of the government’s breakup of Yukos, and other swindles, the annual growth rate in oil extraction has fallen from 13% to 2%. The Russian economy might have grown more quickly on account of its gas segment, but independent gas producers are being crushed by Gazprom, which has increased production over the past eight years by only 0.6%. The Russian economy might have grown quicker on account of its manufacturing sectors. But not a single sector of Russian manufacturing (with the exception of gas) has to this day exceeded the production levels achieved even in the time of the Soviet Union. For example, Russian machine building is now only one-half what it was in the time of the Soviet Union. So perhaps we should consider as an economic success for 2020 not the entry of Russia into the group of the top five economies of the world, but simply the resurrection of the volume of machine building to the level seen in 1990.

Russia nonetheless still has a chance to become a developed, attractive and respected country. But for this to happen much has to be done. Including a lot that will directly contradict what is being done by current forecasters of our “bright future”. Russia has a chance, if it is ruled not by lawlessness but legal order. If all our citizens become genuinely equal before the law, if the judiciary deals with criminal conduct irrespective of whether it is by an entrepreneur, an officer of the FSB, or the son of a First Prime Minister. If government companies can refrain from stealing the property of others, strangling independent producers, and in the end are de-monopolized. If billions of dollars stop flowing from the pockets of Russian taxpayers into endless national project boondoggles, “miracle-weapons” and government “nanotechnologies”.

Russia can save its historical chance if the current political path, being pursued by both Vice Prime Ministers, is curtailed. But Russia has no chance if it continues on this path.

Another Original LR Translation: Illarionov on Russia’s Future

La Russophobe‘s original translator offers yet another indispensible installment from the brilliant pen of Andrei Illarionov, who knows the Putin regime from the inside and is the last best hope to save Russia from the ashcan of history. This is the article that formed the basis for Cyrill Vatomsky’s wonderful and devastating critique of the Putin regime which we cross-published yesterday.

Russia Will Not Enter the Top Five Economies By 2020 On Its Current Course

Andrei Illarionov

Yezhednevniy Zhurnal

June 27, 2007

Apparently the intoxicated air of the White Nights and black-tie riverboat dinners played cruel tricks on some of the participants in the recent Petersburg Economic Forum [June 8-10, 2007]. The sheer volume of inaccuracies, distortions and absurdities uttered at the form could only invite humor.

A high bar was set by former president of the World Bank James D. Wolfensohn, who asserted that “since 1995 Russian GDP has increased by five times, after declining by 50% from 1991 to 1995.” One would think that for the former head of the respected international organization there could be no secrets in the statistical data of the world’s countries. But apparently there were.

If the current head of the board of directors of Citigroup has a problem accessing the Internet, then perhaps he could inquire with the statistical department of his own bank, turn to his colleagues at the IMF, or as a last resort take an interest in the work of the Russian Federal Statistical Service. Anyone there would be glad to answer him precisely: from 1991-1995 Russian GDP declined by 34.6%, and from 1995-2006 it grew by 55.6%. It may be that James Wolfensohn is, as [Russian Minister of Economic Development and Trade] German Gref has called him, a friend, but the truth is more valuable.

The switching of concepts in the speech of the Russian President was much more refined: “In the first quarter of this year direct foreign investment in the Russian economy rose by two and half times compared to the previous year. And accumulated foreign investment reached $150 billion.” The listener might have gotten the impression that the last figure related to the direct foreign investment that was mentioned in the first sentence. But that would be incorrect. The $151 billion figure was the total amount, as of April 1, 2007, of all foreign investment – not only direct, but also portfolio (investment in equities and shares totaling less than 10% of a company’s total capital, and the purchase of bonds, notes and other promissory paper), as well as other investments (such as trade credits and credits to the government).

The only true indicator of a country’s attractiveness for investment is direct private investment. As of April 1, 2007 it totaled $73 billion in Russia. This is a significant amount. However, if we compare it with the size of the Russian economy, it looks rather modest – only about 7% of GDP. Not including direct foreign investment in energy the figure is even smaller – just 4.5% of GDP. By way of comparison: in Ukraine accumulated foreign investment exceeds 19% of GDP; in Latvia, Lithuania and Poland it is 25%; in Georgia, 42%; and in Estonia it is 59% of GDP.

Proclamations of a macroeconomic type opened a whole new frontier of humor. “If 50 years ago 60% of world GDP originated in the Big Seven countries, today it is the opposite: around 60% of world GDP comes from countries outside their borders,” continued the Russian President. It is true that in 2006 the share of the Big Seven countries totaled 41% of world GDP. But it is also true that 50 years ago the Big Seven produced not 60% but 51% of world GDP. Hence the reduction in their share of the world economy over the past 50 years declined from 51% to 41%, or by one-fifth – not nearly as sharply as depicted in the Russian President’s speech.

Of course, one could gloat over the decline in the weight of the Big Seven in the world economy. But it would be worthwhile to first consider how the place of Russia itself has changed in the world. In comparison with the Big Seven, the relative weight of Russian GDP over the past 50 years has declined from 12.1% to 6.3%, and in comparison with world GDP it has fallen from 6.2% to 2.5% – that is, by two and a half times. Now that is a shift of a truly tectonic nature. And it is hard to argue with the President when he says that “the world has truly changed, literally before our eyes.”

But even these pronouncements paled against the forecasts. Mr. Wolfensohn “promised” that “the economies of Russia and the developing countries will grow 20 times by 2050, while the developed countries will grow by only 2.5 times.” Even if that could happen, a better illustration of the embellishment “We too ploughed” [TN: said of someone who makes overly much of his modest contribution] could hardly be found. That the economies of China, India and other developing countries may reach the size of the current Big Seven economies has not been a secret to anyone for a long time. The challenge this presents to Russia would be well worth considering.

But there was no time for such considerations in Saint Petersburg. Otherwise the predictions of a twenty-fold growth rate in the economic prospects of Russia could hardly have come to light. For a country with a population that is shrinking at the rate of Russia’s, a 20-fold increase in GDP would require a 25-fold increase in GDP per capita. How could this be achieved even theoretically, if in all of world history there has never been such a rate of growth for a country with a population of more than 1 million souls? The world record holders for economic growth rate, which have come to symbolize “economic miracles”, look much different: over 43 years, the growth rate in Japan in per capita GDP was 10 times; in Korea – 12 times; in Taiwan – 13 times; in China – 17 times.

If one were to rely on the official forecasts of the World Bank and IMF, then even extrapolating a continuation of the unprecedented high growth rate of the past few years for the world economy, the GDP growth rate in the developing countries by 2050 is unlikely to exceed 8 times, while that of the developed countries would be five times.

The height of pseudo-scientific futurology was achieved in the presentation by Russian First Vice-Minister Sergei Ivanov: “By 2020 Russia’s GDP will place it in the top five economies of the world”, and “Russian per capita GDP in terms of Purchasing Power Parity (PPP) will amount to $30,000 on the basis of 2005 prices.” First Deputy Prime Minister Dmitriy Medvedev agreed with this assertion.

Alas, the promises made by the candidate-successors [to President Putin] will never come true. And not just because in order for the per capita GDP per person in Russia to reach $30,000 it would have to reach 50% of the per capita GDP of the most developed countries of the world (especially the U.S.), which has never happened in 150 years of Russian history. And not even on the doubtful basis of extrapolating a constant high growth rate for Russia and low growth rate for Europe.

The problem is that higher economic growth rates require a completely different institutional environment. The growth rate depends not only and not so much on the volume of investment – international or domestic – as on the condition of social and government institutions – private property rights, division of government powers, freedom of mass media, independence of the judiciary, civil rights, political rights, and legal order.

World history knows of not a single case in which a country not having energy revenues and being unfree (in the sense of political rights, civil freedoms, legal order and defense of property rights) achieved a GDP of even $17,000 per person. For countries with energy revenues the insurmountable barrier has been somewhat higher, but is nonetheless far short $30,000.

Alas, present-day Russia is just such an unfree country, and the situation with its key social and governmental institutions excludes the possibility of its entry into the group of the most developed countries.

The Russian economy might have grown more quickly on account of its oil industry, but as a result of the government’s breakup of Yukos, and other swindles, the annual growth rate in oil extraction has fallen from 13% to 2%. The Russian economy might have grown more quickly on account of its gas segment, but independent gas producers are being crushed by Gazprom, which has increased production over the past eight years by only 0.6%. The Russian economy might have grown quicker on account of its manufacturing sectors. But not a single sector of Russian manufacturing (with the exception of gas) has to this day exceeded the production levels achieved even in the time of the Soviet Union. For example, Russian machine building is now only one-half what it was in the time of the Soviet Union. So perhaps we should consider as an economic success for 2020 not the entry of Russia into the group of the top five economies of the world, but simply the resurrection of the volume of machine building to the level seen in 1990.

Russia nonetheless still has a chance to become a developed, attractive and respected country. But for this to happen much has to be done. Including a lot that will directly contradict what is being done by current forecasters of our “bright future”. Russia has a chance, if it is ruled not by lawlessness but legal order. If all our citizens become genuinely equal before the law, if the judiciary deals with criminal conduct irrespective of whether it is by an entrepreneur, an officer of the FSB, or the son of a First Prime Minister. If government companies can refrain from stealing the property of others, strangling independent producers, and in the end are de-monopolized. If billions of dollars stop flowing from the pockets of Russian taxpayers into endless national project boondoggles, “miracle-weapons” and government “nanotechnologies”.

Russia can save its historical chance if the current political path, being pursued by both Vice Prime Ministers, is curtailed. But Russia has no chance if it continues on this path.

Another Original LR Translation: Illarionov on Russia’s Future

La Russophobe‘s original translator offers yet another indispensible installment from the brilliant pen of Andrei Illarionov, who knows the Putin regime from the inside and is the last best hope to save Russia from the ashcan of history. This is the article that formed the basis for Cyrill Vatomsky’s wonderful and devastating critique of the Putin regime which we cross-published yesterday.

Russia Will Not Enter the Top Five Economies By 2020 On Its Current Course

Andrei Illarionov

Yezhednevniy Zhurnal

June 27, 2007

Apparently the intoxicated air of the White Nights and black-tie riverboat dinners played cruel tricks on some of the participants in the recent Petersburg Economic Forum [June 8-10, 2007]. The sheer volume of inaccuracies, distortions and absurdities uttered at the form could only invite humor.

A high bar was set by former president of the World Bank James D. Wolfensohn, who asserted that “since 1995 Russian GDP has increased by five times, after declining by 50% from 1991 to 1995.” One would think that for the former head of the respected international organization there could be no secrets in the statistical data of the world’s countries. But apparently there were.

If the current head of the board of directors of Citigroup has a problem accessing the Internet, then perhaps he could inquire with the statistical department of his own bank, turn to his colleagues at the IMF, or as a last resort take an interest in the work of the Russian Federal Statistical Service. Anyone there would be glad to answer him precisely: from 1991-1995 Russian GDP declined by 34.6%, and from 1995-2006 it grew by 55.6%. It may be that James Wolfensohn is, as [Russian Minister of Economic Development and Trade] German Gref has called him, a friend, but the truth is more valuable.

The switching of concepts in the speech of the Russian President was much more refined: “In the first quarter of this year direct foreign investment in the Russian economy rose by two and half times compared to the previous year. And accumulated foreign investment reached $150 billion.” The listener might have gotten the impression that the last figure related to the direct foreign investment that was mentioned in the first sentence. But that would be incorrect. The $151 billion figure was the total amount, as of April 1, 2007, of all foreign investment – not only direct, but also portfolio (investment in equities and shares totaling less than 10% of a company’s total capital, and the purchase of bonds, notes and other promissory paper), as well as other investments (such as trade credits and credits to the government).

The only true indicator of a country’s attractiveness for investment is direct private investment. As of April 1, 2007 it totaled $73 billion in Russia. This is a significant amount. However, if we compare it with the size of the Russian economy, it looks rather modest – only about 7% of GDP. Not including direct foreign investment in energy the figure is even smaller – just 4.5% of GDP. By way of comparison: in Ukraine accumulated foreign investment exceeds 19% of GDP; in Latvia, Lithuania and Poland it is 25%; in Georgia, 42%; and in Estonia it is 59% of GDP.

Proclamations of a macroeconomic type opened a whole new frontier of humor. “If 50 years ago 60% of world GDP originated in the Big Seven countries, today it is the opposite: around 60% of world GDP comes from countries outside their borders,” continued the Russian President. It is true that in 2006 the share of the Big Seven countries totaled 41% of world GDP. But it is also true that 50 years ago the Big Seven produced not 60% but 51% of world GDP. Hence the reduction in their share of the world economy over the past 50 years declined from 51% to 41%, or by one-fifth – not nearly as sharply as depicted in the Russian President’s speech.

Of course, one could gloat over the decline in the weight of the Big Seven in the world economy. But it would be worthwhile to first consider how the place of Russia itself has changed in the world. In comparison with the Big Seven, the relative weight of Russian GDP over the past 50 years has declined from 12.1% to 6.3%, and in comparison with world GDP it has fallen from 6.2% to 2.5% – that is, by two and a half times. Now that is a shift of a truly tectonic nature. And it is hard to argue with the President when he says that “the world has truly changed, literally before our eyes.”

But even these pronouncements paled against the forecasts. Mr. Wolfensohn “promised” that “the economies of Russia and the developing countries will grow 20 times by 2050, while the developed countries will grow by only 2.5 times.” Even if that could happen, a better illustration of the embellishment “We too ploughed” [TN: said of someone who makes overly much of his modest contribution] could hardly be found. That the economies of China, India and other developing countries may reach the size of the current Big Seven economies has not been a secret to anyone for a long time. The challenge this presents to Russia would be well worth considering.

But there was no time for such considerations in Saint Petersburg. Otherwise the predictions of a twenty-fold growth rate in the economic prospects of Russia could hardly have come to light. For a country with a population that is shrinking at the rate of Russia’s, a 20-fold increase in GDP would require a 25-fold increase in GDP per capita. How could this be achieved even theoretically, if in all of world history there has never been such a rate of growth for a country with a population of more than 1 million souls? The world record holders for economic growth rate, which have come to symbolize “economic miracles”, look much different: over 43 years, the growth rate in Japan in per capita GDP was 10 times; in Korea – 12 times; in Taiwan – 13 times; in China – 17 times.

If one were to rely on the official forecasts of the World Bank and IMF, then even extrapolating a continuation of the unprecedented high growth rate of the past few years for the world economy, the GDP growth rate in the developing countries by 2050 is unlikely to exceed 8 times, while that of the developed countries would be five times.

The height of pseudo-scientific futurology was achieved in the presentation by Russian First Vice-Minister Sergei Ivanov: “By 2020 Russia’s GDP will place it in the top five economies of the world”, and “Russian per capita GDP in terms of Purchasing Power Parity (PPP) will amount to $30,000 on the basis of 2005 prices.” First Deputy Prime Minister Dmitriy Medvedev agreed with this assertion.

Alas, the promises made by the candidate-successors [to President Putin] will never come true. And not just because in order for the per capita GDP per person in Russia to reach $30,000 it would have to reach 50% of the per capita GDP of the most developed countries of the world (especially the U.S.), which has never happened in 150 years of Russian history. And not even on the doubtful basis of extrapolating a constant high growth rate for Russia and low growth rate for Europe.

The problem is that higher economic growth rates require a completely different institutional environment. The growth rate depends not only and not so much on the volume of investment – international or domestic – as on the condition of social and government institutions – private property rights, division of government powers, freedom of mass media, independence of the judiciary, civil rights, political rights, and legal order.

World history knows of not a single case in which a country not having energy revenues and being unfree (in the sense of political rights, civil freedoms, legal order and defense of property rights) achieved a GDP of even $17,000 per person. For countries with energy revenues the insurmountable barrier has been somewhat higher, but is nonetheless far short $30,000.

Alas, present-day Russia is just such an unfree country, and the situation with its key social and governmental institutions excludes the possibility of its entry into the group of the most developed countries.

The Russian economy might have grown more quickly on account of its oil industry, but as a result of the government’s breakup of Yukos, and other swindles, the annual growth rate in oil extraction has fallen from 13% to 2%. The Russian economy might have grown more quickly on account of its gas segment, but independent gas producers are being crushed by Gazprom, which has increased production over the past eight years by only 0.6%. The Russian economy might have grown quicker on account of its manufacturing sectors. But not a single sector of Russian manufacturing (with the exception of gas) has to this day exceeded the production levels achieved even in the time of the Soviet Union. For example, Russian machine building is now only one-half what it was in the time of the Soviet Union. So perhaps we should consider as an economic success for 2020 not the entry of Russia into the group of the top five economies of the world, but simply the resurrection of the volume of machine building to the level seen in 1990.

Russia nonetheless still has a chance to become a developed, attractive and respected country. But for this to happen much has to be done. Including a lot that will directly contradict what is being done by current forecasters of our “bright future”. Russia has a chance, if it is ruled not by lawlessness but legal order. If all our citizens become genuinely equal before the law, if the judiciary deals with criminal conduct irrespective of whether it is by an entrepreneur, an officer of the FSB, or the son of a First Prime Minister. If government companies can refrain from stealing the property of others, strangling independent producers, and in the end are de-monopolized. If billions of dollars stop flowing from the pockets of Russian taxpayers into endless national project boondoggles, “miracle-weapons” and government “nanotechnologies”.

Russia can save its historical chance if the current political path, being pursued by both Vice Prime Ministers, is curtailed. But Russia has no chance if it continues on this path.

Another Original LR Translation: Illarionov on Russia’s Future

La Russophobe‘s original translator offers yet another indispensible installment from the brilliant pen of Andrei Illarionov, who knows the Putin regime from the inside and is the last best hope to save Russia from the ashcan of history. This is the article that formed the basis for Cyrill Vatomsky’s wonderful and devastating critique of the Putin regime which we cross-published yesterday.

Russia Will Not Enter the Top Five Economies By 2020 On Its Current Course

Andrei Illarionov

Yezhednevniy Zhurnal

June 27, 2007

Apparently the intoxicated air of the White Nights and black-tie riverboat dinners played cruel tricks on some of the participants in the recent Petersburg Economic Forum [June 8-10, 2007]. The sheer volume of inaccuracies, distortions and absurdities uttered at the form could only invite humor.

A high bar was set by former president of the World Bank James D. Wolfensohn, who asserted that “since 1995 Russian GDP has increased by five times, after declining by 50% from 1991 to 1995.” One would think that for the former head of the respected international organization there could be no secrets in the statistical data of the world’s countries. But apparently there were.

If the current head of the board of directors of Citigroup has a problem accessing the Internet, then perhaps he could inquire with the statistical department of his own bank, turn to his colleagues at the IMF, or as a last resort take an interest in the work of the Russian Federal Statistical Service. Anyone there would be glad to answer him precisely: from 1991-1995 Russian GDP declined by 34.6%, and from 1995-2006 it grew by 55.6%. It may be that James Wolfensohn is, as [Russian Minister of Economic Development and Trade] German Gref has called him, a friend, but the truth is more valuable.

The switching of concepts in the speech of the Russian President was much more refined: “In the first quarter of this year direct foreign investment in the Russian economy rose by two and half times compared to the previous year. And accumulated foreign investment reached $150 billion.” The listener might have gotten the impression that the last figure related to the direct foreign investment that was mentioned in the first sentence. But that would be incorrect. The $151 billion figure was the total amount, as of April 1, 2007, of all foreign investment – not only direct, but also portfolio (investment in equities and shares totaling less than 10% of a company’s total capital, and the purchase of bonds, notes and other promissory paper), as well as other investments (such as trade credits and credits to the government).

The only true indicator of a country’s attractiveness for investment is direct private investment. As of April 1, 2007 it totaled $73 billion in Russia. This is a significant amount. However, if we compare it with the size of the Russian economy, it looks rather modest – only about 7% of GDP. Not including direct foreign investment in energy the figure is even smaller – just 4.5% of GDP. By way of comparison: in Ukraine accumulated foreign investment exceeds 19% of GDP; in Latvia, Lithuania and Poland it is 25%; in Georgia, 42%; and in Estonia it is 59% of GDP.

Proclamations of a macroeconomic type opened a whole new frontier of humor. “If 50 years ago 60% of world GDP originated in the Big Seven countries, today it is the opposite: around 60% of world GDP comes from countries outside their borders,” continued the Russian President. It is true that in 2006 the share of the Big Seven countries totaled 41% of world GDP. But it is also true that 50 years ago the Big Seven produced not 60% but 51% of world GDP. Hence the reduction in their share of the world economy over the past 50 years declined from 51% to 41%, or by one-fifth – not nearly as sharply as depicted in the Russian President’s speech.

Of course, one could gloat over the decline in the weight of the Big Seven in the world economy. But it would be worthwhile to first consider how the place of Russia itself has changed in the world. In comparison with the Big Seven, the relative weight of Russian GDP over the past 50 years has declined from 12.1% to 6.3%, and in comparison with world GDP it has fallen from 6.2% to 2.5% – that is, by two and a half times. Now that is a shift of a truly tectonic nature. And it is hard to argue with the President when he says that “the world has truly changed, literally before our eyes.”

But even these pronouncements paled against the forecasts. Mr. Wolfensohn “promised” that “the economies of Russia and the developing countries will grow 20 times by 2050, while the developed countries will grow by only 2.5 times.” Even if that could happen, a better illustration of the embellishment “We too ploughed” [TN: said of someone who makes overly much of his modest contribution] could hardly be found. That the economies of China, India and other developing countries may reach the size of the current Big Seven economies has not been a secret to anyone for a long time. The challenge this presents to Russia would be well worth considering.

But there was no time for such considerations in Saint Petersburg. Otherwise the predictions of a twenty-fold growth rate in the economic prospects of Russia could hardly have come to light. For a country with a population that is shrinking at the rate of Russia’s, a 20-fold increase in GDP would require a 25-fold increase in GDP per capita. How could this be achieved even theoretically, if in all of world history there has never been such a rate of growth for a country with a population of more than 1 million souls? The world record holders for economic growth rate, which have come to symbolize “economic miracles”, look much different: over 43 years, the growth rate in Japan in per capita GDP was 10 times; in Korea – 12 times; in Taiwan – 13 times; in China – 17 times.

If one were to rely on the official forecasts of the World Bank and IMF, then even extrapolating a continuation of the unprecedented high growth rate of the past few years for the world economy, the GDP growth rate in the developing countries by 2050 is unlikely to exceed 8 times, while that of the developed countries would be five times.

The height of pseudo-scientific futurology was achieved in the presentation by Russian First Vice-Minister Sergei Ivanov: “By 2020 Russia’s GDP will place it in the top five economies of the world”, and “Russian per capita GDP in terms of Purchasing Power Parity (PPP) will amount to $30,000 on the basis of 2005 prices.” First Deputy Prime Minister Dmitriy Medvedev agreed with this assertion.

Alas, the promises made by the candidate-successors [to President Putin] will never come true. And not just because in order for the per capita GDP per person in Russia to reach $30,000 it would have to reach 50% of the per capita GDP of the most developed countries of the world (especially the U.S.), which has never happened in 150 years of Russian history. And not even on the doubtful basis of extrapolating a constant high growth rate for Russia and low growth rate for Europe.

The problem is that higher economic growth rates require a completely different institutional environment. The growth rate depends not only and not so much on the volume of investment – international or domestic – as on the condition of social and government institutions – private property rights, division of government powers, freedom of mass media, independence of the judiciary, civil rights, political rights, and legal order.

World history knows of not a single case in which a country not having energy revenues and being unfree (in the sense of political rights, civil freedoms, legal order and defense of property rights) achieved a GDP of even $17,000 per person. For countries with energy revenues the insurmountable barrier has been somewhat higher, but is nonetheless far short $30,000.

Alas, present-day Russia is just such an unfree country, and the situation with its key social and governmental institutions excludes the possibility of its entry into the group of the most developed countries.

The Russian economy might have grown more quickly on account of its oil industry, but as a result of the government’s breakup of Yukos, and other swindles, the annual growth rate in oil extraction has fallen from 13% to 2%. The Russian economy might have grown more quickly on account of its gas segment, but independent gas producers are being crushed by Gazprom, which has increased production over the past eight years by only 0.6%. The Russian economy might have grown quicker on account of its manufacturing sectors. But not a single sector of Russian manufacturing (with the exception of gas) has to this day exceeded the production levels achieved even in the time of the Soviet Union. For example, Russian machine building is now only one-half what it was in the time of the Soviet Union. So perhaps we should consider as an economic success for 2020 not the entry of Russia into the group of the top five economies of the world, but simply the resurrection of the volume of machine building to the level seen in 1990.

Russia nonetheless still has a chance to become a developed, attractive and respected country. But for this to happen much has to be done. Including a lot that will directly contradict what is being done by current forecasters of our “bright future”. Russia has a chance, if it is ruled not by lawlessness but legal order. If all our citizens become genuinely equal before the law, if the judiciary deals with criminal conduct irrespective of whether it is by an entrepreneur, an officer of the FSB, or the son of a First Prime Minister. If government companies can refrain from stealing the property of others, strangling independent producers, and in the end are de-monopolized. If billions of dollars stop flowing from the pockets of Russian taxpayers into endless national project boondoggles, “miracle-weapons” and government “nanotechnologies”.

Russia can save its historical chance if the current political path, being pursued by both Vice Prime Ministers, is curtailed. But Russia has no chance if it continues on this path.

Another Original LR Translation: Illarionov on Russia’s Future

La Russophobe‘s original translator offers yet another indispensible installment from the brilliant pen of Andrei Illarionov, who knows the Putin regime from the inside and is the last best hope to save Russia from the ashcan of history. This is the article that formed the basis for Cyrill Vatomsky’s wonderful and devastating critique of the Putin regime which we cross-published yesterday.

Russia Will Not Enter the Top Five Economies By 2020 On Its Current Course

Andrei Illarionov

Yezhednevniy Zhurnal

June 27, 2007

Apparently the intoxicated air of the White Nights and black-tie riverboat dinners played cruel tricks on some of the participants in the recent Petersburg Economic Forum [June 8-10, 2007]. The sheer volume of inaccuracies, distortions and absurdities uttered at the form could only invite humor.

A high bar was set by former president of the World Bank James D. Wolfensohn, who asserted that “since 1995 Russian GDP has increased by five times, after declining by 50% from 1991 to 1995.” One would think that for the former head of the respected international organization there could be no secrets in the statistical data of the world’s countries. But apparently there were.

If the current head of the board of directors of Citigroup has a problem accessing the Internet, then perhaps he could inquire with the statistical department of his own bank, turn to his colleagues at the IMF, or as a last resort take an interest in the work of the Russian Federal Statistical Service. Anyone there would be glad to answer him precisely: from 1991-1995 Russian GDP declined by 34.6%, and from 1995-2006 it grew by 55.6%. It may be that James Wolfensohn is, as [Russian Minister of Economic Development and Trade] German Gref has called him, a friend, but the truth is more valuable.

The switching of concepts in the speech of the Russian President was much more refined: “In the first quarter of this year direct foreign investment in the Russian economy rose by two and half times compared to the previous year. And accumulated foreign investment reached $150 billion.” The listener might have gotten the impression that the last figure related to the direct foreign investment that was mentioned in the first sentence. But that would be incorrect. The $151 billion figure was the total amount, as of April 1, 2007, of all foreign investment – not only direct, but also portfolio (investment in equities and shares totaling less than 10% of a company’s total capital, and the purchase of bonds, notes and other promissory paper), as well as other investments (such as trade credits and credits to the government).

The only true indicator of a country’s attractiveness for investment is direct private investment. As of April 1, 2007 it totaled $73 billion in Russia. This is a significant amount. However, if we compare it with the size of the Russian economy, it looks rather modest – only about 7% of GDP. Not including direct foreign investment in energy the figure is even smaller – just 4.5% of GDP. By way of comparison: in Ukraine accumulated foreign investment exceeds 19% of GDP; in Latvia, Lithuania and Poland it is 25%; in Georgia, 42%; and in Estonia it is 59% of GDP.

Proclamations of a macroeconomic type opened a whole new frontier of humor. “If 50 years ago 60% of world GDP originated in the Big Seven countries, today it is the opposite: around 60% of world GDP comes from countries outside their borders,” continued the Russian President. It is true that in 2006 the share of the Big Seven countries totaled 41% of world GDP. But it is also true that 50 years ago the Big Seven produced not 60% but 51% of world GDP. Hence the reduction in their share of the world economy over the past 50 years declined from 51% to 41%, or by one-fifth – not nearly as sharply as depicted in the Russian President’s speech.

Of course, one could gloat over the decline in the weight of the Big Seven in the world economy. But it would be worthwhile to first consider how the place of Russia itself has changed in the world. In comparison with the Big Seven, the relative weight of Russian GDP over the past 50 years has declined from 12.1% to 6.3%, and in comparison with world GDP it has fallen from 6.2% to 2.5% – that is, by two and a half times. Now that is a shift of a truly tectonic nature. And it is hard to argue with the President when he says that “the world has truly changed, literally before our eyes.”

But even these pronouncements paled against the forecasts. Mr. Wolfensohn “promised” that “the economies of Russia and the developing countries will grow 20 times by 2050, while the developed countries will grow by only 2.5 times.” Even if that could happen, a better illustration of the embellishment “We too ploughed” [TN: said of someone who makes overly much of his modest contribution] could hardly be found. That the economies of China, India and other developing countries may reach the size of the current Big Seven economies has not been a secret to anyone for a long time. The challenge this presents to Russia would be well worth considering.

But there was no time for such considerations in Saint Petersburg. Otherwise the predictions of a twenty-fold growth rate in the economic prospects of Russia could hardly have come to light. For a country with a population that is shrinking at the rate of Russia’s, a 20-fold increase in GDP would require a 25-fold increase in GDP per capita. How could this be achieved even theoretically, if in all of world history there has never been such a rate of growth for a country with a population of more than 1 million souls? The world record holders for economic growth rate, which have come to symbolize “economic miracles”, look much different: over 43 years, the growth rate in Japan in per capita GDP was 10 times; in Korea – 12 times; in Taiwan – 13 times; in China – 17 times.

If one were to rely on the official forecasts of the World Bank and IMF, then even extrapolating a continuation of the unprecedented high growth rate of the past few years for the world economy, the GDP growth rate in the developing countries by 2050 is unlikely to exceed 8 times, while that of the developed countries would be five times.

The height of pseudo-scientific futurology was achieved in the presentation by Russian First Vice-Minister Sergei Ivanov: “By 2020 Russia’s GDP will place it in the top five economies of the world”, and “Russian per capita GDP in terms of Purchasing Power Parity (PPP) will amount to $30,000 on the basis of 2005 prices.” First Deputy Prime Minister Dmitriy Medvedev agreed with this assertion.

Alas, the promises made by the candidate-successors [to President Putin] will never come true. And not just because in order for the per capita GDP per person in Russia to reach $30,000 it would have to reach 50% of the per capita GDP of the most developed countries of the world (especially the U.S.), which has never happened in 150 years of Russian history. And not even on the doubtful basis of extrapolating a constant high growth rate for Russia and low growth rate for Europe.

The problem is that higher economic growth rates require a completely different institutional environment. The growth rate depends not only and not so much on the volume of investment – international or domestic – as on the condition of social and government institutions – private property rights, division of government powers, freedom of mass media, independence of the judiciary, civil rights, political rights, and legal order.

World history knows of not a single case in which a country not having energy revenues and being unfree (in the sense of political rights, civil freedoms, legal order and defense of property rights) achieved a GDP of even $17,000 per person. For countries with energy revenues the insurmountable barrier has been somewhat higher, but is nonetheless far short $30,000.

Alas, present-day Russia is just such an unfree country, and the situation with its key social and governmental institutions excludes the possibility of its entry into the group of the most developed countries.

The Russian economy might have grown more quickly on account of its oil industry, but as a result of the government’s breakup of Yukos, and other swindles, the annual growth rate in oil extraction has fallen from 13% to 2%. The Russian economy might have grown more quickly on account of its gas segment, but independent gas producers are being crushed by Gazprom, which has increased production over the past eight years by only 0.6%. The Russian economy might have grown quicker on account of its manufacturing sectors. But not a single sector of Russian manufacturing (with the exception of gas) has to this day exceeded the production levels achieved even in the time of the Soviet Union. For example, Russian machine building is now only one-half what it was in the time of the Soviet Union. So perhaps we should consider as an economic success for 2020 not the entry of Russia into the group of the top five economies of the world, but simply the resurrection of the volume of machine building to the level seen in 1990.

Russia nonetheless still has a chance to become a developed, attractive and respected country. But for this to happen much has to be done. Including a lot that will directly contradict what is being done by current forecasters of our “bright future”. Russia has a chance, if it is ruled not by lawlessness but legal order. If all our citizens become genuinely equal before the law, if the judiciary deals with criminal conduct irrespective of whether it is by an entrepreneur, an officer of the FSB, or the son of a First Prime Minister. If government companies can refrain from stealing the property of others, strangling independent producers, and in the end are de-monopolized. If billions of dollars stop flowing from the pockets of Russian taxpayers into endless national project boondoggles, “miracle-weapons” and government “nanotechnologies”.

Russia can save its historical chance if the current political path, being pursued by both Vice Prime Ministers, is curtailed. But Russia has no chance if it continues on this path.

July 2, 2007 — Contents

MONDAY JULY 2 CONTENTS


(1) Another Original LR Translation: Illarionov on Russia’s Future

(2) Annals of “Pacified” Chechnya”

(3) Annals of Russian Racism

(4) Annals of Screwball Yuri Mamchur (yep, he’s at it AGAIN)

Another Original LR Translation: Illarionov on Russia’s Future

La Russophobe‘s original translator offers yet another indispensible installment from the brilliant pen of Andrei Illarionov, who knows the Putin regime from the inside and is the last best hope to save Russia from the ashcan of history. This is the article that formed the basis for Cyrill Vatomsky’s wonderful and devastating critique of the Putin regime which we cross-published yesterday.

Russia Will Not Enter the Top Five Economies By 2020 On Its Current Course

Andrei Illarionov

Yezhednevniy Zhurnal

June 27, 2007

Apparently the intoxicated air of the White Nights and black-tie riverboat dinners played cruel tricks on some of the participants in the recent Petersburg Economic Forum [June 8-10, 2007]. The sheer volume of inaccuracies, distortions and absurdities uttered at the form could only invite humor.

A high bar was set by former president of the World Bank James D. Wolfensohn, who asserted that “since 1995 Russian GDP has increased by five times, after declining by 50% from 1991 to 1995.” One would think that for the former head of the respected international organization there could be no secrets in the statistical data of the world’s countries. But apparently there were.

If the current head of the board of directors of Citigroup has a problem accessing the Internet, then perhaps he could inquire with the statistical department of his own bank, turn to his colleagues at the IMF, or as a last resort take an interest in the work of the Russian Federal Statistical Service. Anyone there would be glad to answer him precisely: from 1991-1995 Russian GDP declined by 34.6%, and from 1995-2006 it grew by 55.6%. It may be that James Wolfensohn is, as [Russian Minister of Economic Development and Trade] German Gref has called him, a friend, but the truth is more valuable.

The switching of concepts in the speech of the Russian President was much more refined: “In the first quarter of this year direct foreign investment in the Russian economy rose by two and half times compared to the previous year. And accumulated foreign investment reached $150 billion.” The listener might have gotten the impression that the last figure related to the direct foreign investment that was mentioned in the first sentence. But that would be incorrect. The $151 billion figure was the total amount, as of April 1, 2007, of all foreign investment – not only direct, but also portfolio (investment in equities and shares totaling less than 10% of a company’s total capital, and the purchase of bonds, notes and other promissory paper), as well as other investments (such as trade credits and credits to the government).

The only true indicator of a country’s attractiveness for investment is direct private investment. As of April 1, 2007 it totaled $73 billion in Russia. This is a significant amount. However, if we compare it with the size of the Russian economy, it looks rather modest – only about 7% of GDP. Not including direct foreign investment in energy the figure is even smaller – just 4.5% of GDP. By way of comparison: in Ukraine accumulated foreign investment exceeds 19% of GDP; in Latvia, Lithuania and Poland it is 25%; in Georgia, 42%; and in Estonia it is 59% of GDP.

Proclamations of a macroeconomic type opened a whole new frontier of humor. “If 50 years ago 60% of world GDP originated in the Big Seven countries, today it is the opposite: around 60% of world GDP comes from countries outside their borders,” continued the Russian President. It is true that in 2006 the share of the Big Seven countries totaled 41% of world GDP. But it is also true that 50 years ago the Big Seven produced not 60% but 51% of world GDP. Hence the reduction in their share of the world economy over the past 50 years declined from 51% to 41%, or by one-fifth – not nearly as sharply as depicted in the Russian President’s speech.

Of course, one could gloat over the decline in the weight of the Big Seven in the world economy. But it would be worthwhile to first consider how the place of Russia itself has changed in the world. In comparison with the Big Seven, the relative weight of Russian GDP over the past 50 years has declined from 12.1% to 6.3%, and in comparison with world GDP it has fallen from 6.2% to 2.5% – that is, by two and a half times. Now that is a shift of a truly tectonic nature. And it is hard to argue with the President when he says that “the world has truly changed, literally before our eyes.”

But even these pronouncements paled against the forecasts. Mr. Wolfensohn “promised” that “the economies of Russia and the developing countries will grow 20 times by 2050, while the developed countries will grow by only 2.5 times.” Even if that could happen, a better illustration of the embellishment “We too ploughed” [TN: said of someone who makes overly much of his modest contribution] could hardly be found. That the economies of China, India and other developing countries may reach the size of the current Big Seven economies has not been a secret to anyone for a long time. The challenge this presents to Russia would be well worth considering.

But there was no time for such considerations in Saint Petersburg. Otherwise the predictions of a twenty-fold growth rate in the economic prospects of Russia could hardly have come to light. For a country with a population that is shrinking at the rate of Russia’s, a 20-fold increase in GDP would require a 25-fold increase in GDP per capita. How could this be achieved even theoretically, if in all of world history there has never been such a rate of growth for a country with a population of more than 1 million souls? The world record holders for economic growth rate, which have come to symbolize “economic miracles”, look much different: over 43 years, the growth rate in Japan in per capita GDP was 10 times; in Korea – 12 times; in Taiwan – 13 times; in China – 17 times.

If one were to rely on the official forecasts of the World Bank and IMF, then even extrapolating a continuation of the unprecedented high growth rate of the past few years for the world economy, the GDP growth rate in the developing countries by 2050 is unlikely to exceed 8 times, while that of the developed countries would be five times.

The height of pseudo-scientific futurology was achieved in the presentation by Russian First Vice-Minister Sergei Ivanov: “By 2020 Russia’s GDP will place it in the top five economies of the world”, and “Russian per capita GDP in terms of Purchasing Power Parity (PPP) will amount to $30,000 on the basis of 2005 prices.” First Deputy Prime Minister Dmitriy Medvedev agreed with this assertion.

Alas, the promises made by the candidate-successors [to President Putin] will never come true. And not just because in order for the per capita GDP per person in Russia to reach $30,000 it would have to reach 50% of the per capita GDP of the most developed countries of the world (especially the U.S.), which has never happened in 150 years of Russian history. And not even on the doubtful basis of extrapolating a constant high growth rate for Russia and low growth rate for Europe.

The problem is that higher economic growth rates require a completely different institutional environment. The growth rate depends not only and not so much on the volume of investment – international or domestic – as on the condition of social and government institutions – private property rights, division of government powers, freedom of mass media, independence of the judiciary, civil rights, political rights, and legal order.

World history knows of not a single case in which a country not having energy revenues and being unfree (in the sense of political rights, civil freedoms, legal order and defense of property rights) achieved a GDP of even $17,000 per person. For countries with energy revenues the insurmountable barrier has been somewhat higher, but is nonetheless far short $30,000.

Alas, present-day Russia is just such an unfree country, and the situation with its key social and governmental institutions excludes the possibility of its entry into the group of the most developed countries.

The Russian economy might have grown more quickly on account of its oil industry, but as a result of the government’s breakup of Yukos, and other swindles, the annual growth rate in oil extraction has fallen from 13% to 2%. The Russian economy might have grown more quickly on account of its gas segment, but independent gas producers are being crushed by Gazprom, which has increased production over the past eight years by only 0.6%. The Russian economy might have grown quicker on account of its manufacturing sectors. But not a single sector of Russian manufacturing (with the exception of gas) has to this day exceeded the production levels achieved even in the time of the Soviet Union. For example, Russian machine building is now only one-half what it was in the time of the Soviet Union. So perhaps we should consider as an economic success for 2020 not the entry of Russia into the group of the top five economies of the world, but simply the resurrection of the volume of machine building to the level seen in 1990.

Russia nonetheless still has a chance to become a developed, attractive and respected country. But for this to happen much has to be done. Including a lot that will directly contradict what is being done by current forecasters of our “bright future”. Russia has a chance, if it is ruled not by lawlessness but legal order. If all our citizens become genuinely equal before the law, if the judiciary deals with criminal conduct irrespective of whether it is by an entrepreneur, an officer of the FSB, or the son of a First Prime Minister. If government companies can refrain from stealing the property of others, strangling independent producers, and in the end are de-monopolized. If billions of dollars stop flowing from the pockets of Russian taxpayers into endless national project boondoggles, “miracle-weapons” and government “nanotechnologies”.

Russia can save its historical chance if the current political path, being pursued by both Vice Prime Ministers, is curtailed. But Russia has no chance if it continues on this path.

Annals of "Pacified" Chechnya: A reporter runs for her life

The Moscow Times reports:

Fatima Tlisova (pictured) had been beaten, harassed and, she suspects, poisoned while working as a journalist in Nalchik. But she finally decided to flee the country the day she sent her 16-year-old son on an errand last year and he did not come back. Tlisova later tracked him down at a police station in the custody of drunken officers who said they had put the boy’s name on a list of suspicious people — a tactic often used by police in roundups of suspected Chechen sympathizers.

Sometimes, human rights advocates say, those caught up in such sweeps are savagely beaten. Sometimes, they vanish forever. “Do you know what these lists are? These are lists of broken lives,” Tlisova said. “The fact that a drunken policeman can drag an innocent young man into a police station in broad daylight and put him on such a list — I didn’t want that to happen to my son.” Tlisova, who worked for The Associated Press in the North Caucasus region for nearly two years, was speaking Thursday at a U.S. Congressional Human Rights Caucus roundtable in Washington. She has moved to the United States to study journalism, keeping her hand in her profession while getting far from the dangers of working in her native land. Tlisova said her son’s detention came just one day after the killing in Moscow of Anna Politkovskaya, a reporter who, like Tlisova, often had written about civilians being killed, beaten and abused in the North Caucasus.

Tlisova said her troubles began in 2002, a few days after writing a story for the newspaper Obshchaya Gazeta documenting soldiers’ abuse of Chechens. After a party celebrating her 36th birthday, she walked her friends to the door of her apartment building. After the last guests departed, a hand grabbed her and she says she was dragged around a corner and beaten by two large men. She spent several days in intensive care with broken ribs, a concussion and other injuries. In 2005, a car with tinted glass pulled up to her on a Nalchik street and she was told to get inside if she wanted to see her children again. She said she then was taken to a forest and held there for three hours. She said several men dragged her about by her hair and extinguished cigarettes on her fingertips, telling her they were doing it “so that you can write better.” Tlisova believed reporting her abduction to the police was out of the question because she said she recognized her abductors as local officers of the Federal Security Service.

A few weeks after her son’s detention in October 2006, Tlisova said she came home one night to find signs that her apartment had been broken into. The next morning, she awoke feeling seriously ill, then fainted. Hospital tests showed she was suffering acute kidney failure, although tests 10 days later showed her kidneys functioning normally. She believes an intruder put poison in her food. Tlisova stepped up her efforts to find a way to get out of Russia but fell ill again. As she lay in a hospital, she vowed she would get out of journalism — but the decision sat uneasily with her. Then a woman called her and asked her to come to her village to investigate the mysterious illnesses afflicting children at a school there. “I got this urge, this feeling that I had to go, I had to find out what happened,” she said, and she went to cover the story. Two months later, she arrived in the United States, relieved to be in a safer place, but frustrated that she can no longer tell the world about the violence in her homeland. Injustices “are happening every day, one cannot be silent about them,” she said. Some day, she hopes, she will return.

Annals of Russian Racism: The Chechnya Complex

Writing in Prague Watchdog Dr. Dmitry Shlapentokh (pictured), an Associate Professor of History at Indiana University South Bend, USA, exposes latent Russian racism, the fraud of Russian economic progress and the potential downfall of Russia:

Russia has recently witnessed several major outbreaks of ethnic violence, mostly between ethnic Russians and Chechens. Of most importance here are two events, in Kondopoga (September 2006) and recently in Stavropol (May-early June 2007), which indicate a serious ethnic and, implicitly, social tension in Russia, recent improvements notwithstanding.

The presence of tension is also indirectly indicated by Putin’s extreme reluctance to discuss revolutions, even those in the past, such as the February and October (Bolshevik) Revolutions of 1917, which took place exactly 90 years ago. While there are some structural similarities between the revolutions of the past and the present tension, they are separated by one clear difference. Today, much more so than in the past, the social conflicts are sublimated in ethnic conflicts.

Ethnic animosity

It is this fear and dislike of people from the Caucasus, especially Chechens, that has contributed enormously to the general xenophobic thrust of Russian society. One of my old friends from Moscow says that hatred of people of Caucasian nationality and of Jews has spread. And, indeed, this ethnic animosity has replaced the sense of social hatred that was so strong at the time of the Russian revolutions of 1905-1921; to be precise, the social animosity has been sublimated in ethnic animosity.

My conversation with a young Russian woman on one of my recent trips to Russia could illustrate this point. While travelling, we observed through the train window the nearby villages; and she commented on the houses we passed, saying that some are good and some are bad. In order to check her sense of social animosity, I replied, “Capitalist landlord and poor peasants.” She snapped angrily, “I don’t like to divide people along social lines.”

The statement of my casual interlocutor should , of course, should be taken with a grain of salt. It simply means that social divisions have been transformed in the minds of many Russians into ethnic divisions while minorities – including Chechens but not only Chechens – are affiliated with the elite, whereas Russians are implicitly seen as the representatives of the lower class.

The involvement in crime of Chechens and other people from the Caucasus is seen in a sort of twisted way as an additional manifestation of oppression/harassment of ethnic Russians by those minorities and the government/elite on their side. It is not surprising that this feeling of animosity is spreading not just against the “people of Caucasian nationality” but also against the government.

A government of the minorities

The sense that the regime is not on the side of the masses was certainly the feeling of the Russian populace during the momentous events of 1917 that toppled the tsarist regime and, later, the provisional government. In the view of the masses, the regime had represented the “lords” (gospod), which included not just the rich capitalists and landlords but the broad segment of the Russian middle class, which, in the minds of the populace, actually included anyone who was neatly dressed and literate.

The situation is different in present-day Russia, where average Russians see the government as being foreign to them because – in their view – it represents the minorities. It is asserted in this context that the current regime is not Russian; and this sort of view has even been able to reach a national audience, despite the heavy censorship of the mass media.

In a radio discussion during the summer of 2006, Markov, the well-known nationalist-minded commentator, praised the achievements of Putin’s regime for doing a lot for the Russian state, and implicitly for ethnic Russians. Elaborating on Putin’s achievements, Markov said that Putin ended the “Time of Trouble” and strengthened the Russian state, limiting the power of oligarchs, even though they still exist.

While strengthening the Russian state, Putin also prevented the West from taking command of the Russian economy. Europeans wanted to take over Gazprom, but Putin stopped this dangerous encroachment, and Gazprom is fully in the hands of the Russian state.

Putin also increased Russia’s prestige among the people outside the borders of the Russian Federation. Under Putin, Russia once again became a reliable ally. Putin would not betray Ossetia, Abkhazia and the Transdnestrian Republic. Putin’s achievement in pacification of the Caucasus was also praised. Markov asserted that Dagestan and Chechnya are a part of Russia; and he implied that Chechnya and Dagestan were actually pacified.

In short, Putin is a leader who has thought about the state and, implicitly, about ethnic Russians. Still, some of his nationalist-minded listeners were not convinced and called in, stating on the air that the present-day Russian regime is not Russian. Rather, it caters to the interests of minorities, including Chechens, but not to ethnic Russians; and it was this feeling, the spread of which as the author of this piece became aware in the summer of 2006, was a catalyst for the pogroms of September 2006 in Kondopoga and recently in Stavropol.

The Stavropol riots

One of the essential aspects of the post-Soviet period is the sharp and increasing polarization along regional lines, and especially between the big cities and the capital and the rest of the country.

It is true that this difference had been present in the Soviet era. Still, the end of the Soviet regime has led to a sharp increase in polarization and is apparently increasing at present. While the big cities, especially Moscow, are booming, the provinces, especially the smaller cities, are in much worse shape. The difference here is so great that for some provincials, Moscow actually has become a “foreign country,” while the imperial capital gorges on the rest of the country.

The employment opportunities in the many provincial cities are quite limited; enterprises that provided employment in the Soviet era were closed and did not reopen even after the beginning of the recent improvement of the Russian economy. In addition, the collapse of professional educators, e.g. PTU, the professional schools that trained skilled laborers, has created additional problems.

All of this goes along with the decline, or in some cases, complete collapse, of the Soviet-type social protection net, which was interwoven with the strongly repressive and controlling aspect of the regime. The new generation that matured in post-Soviet Russia not only does not have the secure and controlling environment of the Soviet era but also has no illusions about the market economy as it was in the late 1980s­­-early 1990s.

And unlike the older generation, it has no personal memory, and thus no fear, of the terrible power of the state. They are also different from the nationalists of the Yeltsin era who, while extremely critical of the regime, were quite sheepish in their concrete actions; these new radical youngsters have little respect for authorities and are ready for violence. All of this explains that while nationalistic and quasi-social animus has spread all over the country, it is the provincial Kondopoga and recently Stavropol that have become the hotbed of violence.

In late May and early June, Stavropol, a city in the south of European Russia near the border of Chechnya, was marked by large-scale ethnic rioting. It was the worst – or at any rate one of the worst – riots of this kind since Kondopoga. The event indicated the continued high level of ethnic, social, and, in a way, regional tension.

As in the case of Kondopoga, the riot erupted with a brawl between a group of Russians and what Russians usually call “people of Caucasian nationality,” mostly Chechens. Both groups had called for reinforcements; and soon enough the brawl was transformed into a virtual battle with up to 300-400 people involved. The police seemed to be watching with a sort of indifference. Still, when the rioters attacked the police, the riot police arrived and engaged with the crowd. As a result, dozens of people were seriously injured, and one Chechen was killed.

A few days later, two Russian boys were killed; allegedly their throats were slit. The crime was attributed to Chechens, and several hundred people rallied on one of the squares and put forward a variety of demands, from protection from ethnic violence to an end to corruption. They also demanded – as in the case of Kondopoga – the creation of grassroots detachments, the “druzhina”, to maintain order.

According to some reports, some of those who participated in the rally later engaged in acts of vandalism. Still, the authorities were able to stop the violence from the development into a wide scale pogrom. While this aspect of the event was reflected in the press, one of the essential aspects was ignored. This was the ideology of the participants in the event, particularly their vision of their enemies.

Interestingly enough, those Russians who participated in the events did not regard all minorities as enemies, at least judging by their Internet conversations. They had rather positive views of Armenians and Greeks; even negative views of Jews were mentioned only in passing. The focus was the Chechens, who are seen as the embodiment of all evil and should be deported or simply eliminated.

Next to Chechens, state authorities, especially those in Moscow, are especially hated. In the view of the participants, Putin has become a powerless tool in the hands of Kadyrov, and Moscow has ceased to be a Russian city. Not only Moscow elite, but all Moscow as a city live at the expense of other Russians. Their images have blended with the images of Chechens as alien to Russians. The participants of the Internet discussion proclaimed that Russians should respond to this situation.

They should create a purely Russian party, like the National Unity party led by Barkashov in the1990s and, in some way, wage war against Chechens and the Moscow/government alliance. One of the participants of the discussion proposed measures such as the blowing up of train tracks or pipelines. Other participants suggested that firearms should be acquired for future struggle.

Conclusion

Despite what seems to be a booming Russian economy, a considerable part of the Russian population, especially those in the provinces, is not affected by the improvement. At the same time, the new generation of youth supports the push for violence. The social animus has translated into ethnic animosity and the feeling that the Russian government does not care about ethnic Russians. All of this recently led to ethnic riots, Stavropol being one of the most recent examples.

The implications of these events are hard to assess, and it is of course also difficult to make accurate predictions about the future. Still, they indicate the continuous instability in post-Soviet society and may possibly be the harbinger of things to come, especially in the case of a rapid decline in oil prices and oil revenues for Russia.

And there are other immediate repercussions. This general hostility of ethnic Russians to “people of Caucasian nationality,” especially Chechens, has stimulated the continuous violence and terrorist activities in the Caucasus, including Chechnya. These acts of violence have created a strong fear of terrorism in Russian society, amplified by the fact that the fear of real or imaginary terror has often in reality been a kind of sublimation of many other fears. And in this the Russians, of course, are not alone.

Annals of Screwball Yuri Mamchur: The Deception Continues

EDITORIAL

Annals of Screwball Yuri Mamchur

In a post that is bizarre even by his own psychopathic standards, Russia Blog publisher Yuri Mamchur has provided readers with an endlessly long, heinously boring transcript of a forum funded by the Discovery Institute entitled “Russia, Friend, Foe or What?” The information is made available more than two months after the event took place, and Mamchur doesn’t care to say how many attended, much less who (there’s a photograph in the post of a tiny room with lots of empty seats). It’s a laugh riot, but nonetheless it’s a bubble that must be popped, since too often we’ve seen the Big Lie repeated enough times that even clever people start to believe it. Hence, La Russophobe takes out her sharpened needle . . .

According to Mamchur, the forum offered “insights into the politics, business and investment climate through out the country are helpful in discerning the truth behind many of the most common assumptions made about Russia in America and Europe.” If, from the title, you thought that one or more of the four speakers might argue the proposition that the assumption Russia is friend is false, or at least be in some way critical of Russia’s KGB regime and slide into dictatorship, you were mightily disappointed.

The speakers were Mamchur himself, John Miller, Bill Robinson and Herbert Ellison. Knowing a little about them (granted, you already know Mamchur too well) would allow you to know what they said without actually burdening yourself with listening.

Bill Robinson (pictured, right) is identified as an “international lawyer.” If you click through to Mr. Robinson’s law firm website and glance at his shortlist of selected readings, you find an article in RIA Novosti by Russia Today (hence, Kremlin) employee (and naked Russophile shil) Peter Lavelle, attacking critics of Vladimir Putin. You also find an article by rabid Russophile nutjob Nikolai Petro (like Lavelle, he too has been exposed previously on this blog). And you find a treatise by Mr. Robinson himself in which he admits that his firm “advises clients on how to structure Russian business operations, and how to manage legal issues relating to trade and investment in Russia” In other words, he makes money by convincing foreigners to invest money in Russia. Three guesses as to how objective he is on the Putin administration, and as to how many articles by Russia’s human rights defenders you will find on Robinson’s website, and as to whether or not Mr. Robinson disclosed this fact in his diatribe.

Then there’s John Miller (pictured left – kinda scary, isn’t he?). The link to his background provided by Mamchur is broken. In his remarks, Miller states he is “professor at George Washington University, a former United States Ambassador at Large in the area of human rights – specifically, modern day slavery.” He also states that “the real reason I’m here is that I’m a former chairman of the board of Discovery Institute.” If that implies to you that he lacks any sort of credentials as an expert on Russia, you’re pretty perceptive. His resume states that his areas of knowledge are “Modern Day Slavery, Foreign Policy, Electoral Politics, American History.” He’s a long term functionary of the Discovery Institute, just like Mamchur, and just like Russia Blog henchman Charles Ganske has no meaningful knowledge of Russia at all..

And then last of all there is Herbert Ellison (pictured, right), the only member of the group with legitimate credentials on Russia and no apparent direct ties to Discovery Institute, having served Director of the Henry M. Jackson School of International Studies of the University of Washington, and the Kennan Institute for Advanced Russian Studies (Woodrow Wilson International Center for Scholars, Washington, D.C.). Could this scholar be counted on to deliver some necessary counterbalance to the tidal wave of Russophile propaganda offered by the other three? Judge for yourself, dear reader:

The point I want to break out of this is that I think there is a considerable error in much of the writing about Putin which provides a negative estimate, and fails to give adequate attention to the remarkable achievements of this period. And I have already indicated that I felt the same way, very often, about the treatment of Yeltsin. I’m not quite sure why that has continued to occur, but he has done another thing for which he has been criticized – he has massively reduced the corruption in the Russian governmental apparatus. Now like Yeltsin, he did this in a way that did not require a public vote on what was a constitutional change, and that was much resented, especially by the people [Russian governors] who were removed. But the point was, he felt that the only way he could be confident of the support and effectiveness of the regional governors was to have some role, some check, on the current process of their selection.

So much for diversity of viewpoints. How did Russia Blog come up with this guy? Well, he’s teaching out in Washington State (his alma mater, class of ’51, which puts him well into his seventies — his exact age is hard to determine since he’s virtually a non-entity on the web), right next to Discovery Institute’s headquarters. Perhaps they offered him a pretty penny, and besides that, he’s about 95 million years old and in the twilight of his career to say the least. He so significant these days that Wikipedia has never heard of him. A Google search yields 708 hits (little old La Russophobe has 75,000) and some of them are for a different “Herbert Ellison.” So he may well be willing to say just about anything for some attention.

Mamchur actually admits that he’s engaged in blatant, dishonest propaganda. Here’s his exact words:

The project is called the Real Russia Project because Discovery Institute’s statement is “to make a positive vision of the future practical.” Recently, the idea of positive relations between Russia and America has increasingly become impossible in most people’s minds. In the American press, everything we hear about Russia is negative. Almost any information about Russia that reaches an American audience nowadays is either sensational or negative. You don’t hear about positive things happening between our two nations. You don’t hear about positive changes that are taking place in Russia. Such negativity between the U.S. and Russia is simply not healthy. So Discovery decided not to cover up what is bad in Russia, but to show what is really going on there.

One could have said the same about Nazi Germany or Stalin’s USSR too, of course. All that nasty bad press about concentration camps and nothing about their wonderful flower gardens! This is what we are faced with, we who wish to save the people of Russia from the dustbin of history. These are our enemies, the likes of Mamchur.

Mamchur also waxed arrogant about Russia Blog, stating: “The website has grown a lot in the last two years since we started, and now it gets quoted and picked up by CNN, FOX News, Google News and others – great media reach for such a modest program.” Modest? It’s the only organizationally funded Russia blog in the world. Oddly, Mamchur doesn’t put in a single link to a mention of Russia Blog by CNN or FOX. Why would they wish to do so? Mamchur says the reason is obvious: “The things we write about are usually very simple things – for example, what’s inside of a grocery store in Moscow.” As of last Friday there were 36 posts displayed on Russia Blog’s home page, covering a full month of content, and 11 of them had zero comments while a further 7 had only one each. So over the course of a month and three dozen posts this blog whose name is bandied about on national TV managed to generate two or more comments only less than half its posts.

Yuri Mamchur is a classic neo-Soviet man. His upbringing has taught him that Americans are morons easily duped by Russians, and has taught him to value illusion over substance. He thinks he can just make things up as he goes along, and people will swallow it all. It helps, of course, that he’s surrounded by folks at the Discovery Institute who believe that evolution is a red herring.

It’s interesting to note, as well, how faithfully the extent of Mamchur’s brazenness tracks that of Vladimir Putin. Just as we see Putin abandoning any pretense of being reasonable in favor of a naked, open assault on the West, we see Mamchur drop any pretense of objectivity and openly declare himself a propagandist in the crudest, most brazen way imaginable, a fully neo-Soviet spectacle indeed.