Edward Lucas' Defence of the Russian Oligarchs.

It is enough to scan through Lucas' The New Cold War and pluck out the manifest logical flaws that keep coming throughout the polemic to realise why The Economist's chief proponent of neoliberal shock therapy has written an atrocious work of propaganda that ought never have been taken seriously by anyone.

The reason The New Cold War is important is not because of the arguments it puts forth, mostly based on a blinkered and myopic inability to face the facts with regards the responsibility of the IMF and the Young Reformers for having imposed an unsuitable Utopian experiment on Russia via shock therapy.

It is important because BBC liberals, Newsnight Book Club and figures in the political Establishment from the UK to the Baltic Republics, Poland and Georgia take this neoliberal ideologue seriously despite the way all responsibility for katastroika is blamed on a Russophobic and essentialist view of Russia as a seamless existential threat.

This reaches absurdity when, for example, in Chapter 9 "How to Win the New Cold War", Lucas makes the statement,

"First a medieval fortress and then a citadel of Soviet totalitarianism, The Kremlin's rose-red walls have rarely made lovers of liberty and justice feel at home. It is as if Britain's government were based in the Tower of London, or France's in the Bastille"

This is an idiotic piece of propaganda.

The Kremlin was first built in 1320 under Ivan Kalita and reflects the history of a Muscovy under potential attack from the Tatars from Mongolia. Most seats of government were built like that. There was obviously no need in England to build a fortress of that kind. Moreover, the main jail under the Soviet regime was the Lyubyanka. Not the Kremlin.

Indeed since Lucas has spent some time in Krakow at the Jageillonian University, he might have had time to notice that the ancient Royal Seat of Kings was also built as a religious and political citadel on a limestone hill at about the same time with extensive fortifications. It is simply a fact of history that Moscow is the capital of Russia now.

But the capital were in St Petersburg as it was for more than two hundred years between (1712-1728, 1732-1918). The 'Window to the West' created by Peter the Great to consolidate Russia's status as a Western power ceased being the capital in 1918 after The Russian Revolution.

In accordance with vicceral Russophobes such as Lucas, Russia is to be damned no matter what it does or how it acts unless in accords strictly in accordance with what he repetitively terms Western "norms". Criticising Russia's elite is not "Russophobic". Lambasting an entire country through wanting things both ways is part of a power strategy.

Throughout this meandering, badly written book Lucas grinds away at the same themes-that Putin is a reversion to Evil and Sinister Muscovite practices, 'a New Tsarism' with the oligarchs playing the role of the courtiers being eliminated just as they were from the time of Ivan the Terrible or Stalin. The more things change in Russia, the more they stay essentially the same.

But for the intervention of the West which is portrayed in tragic terms by Lucas as a noble attempt to bring Russia into the Western fold of 'normality', as if shock therapy was a well intentioned shot at this that went wrong because of the forces of inertia, the Russian mentality and the brake on progress caused by residual Communist mentalities.

Certainly shots were fired. Not least when 170 people were shot dead outside the Duma in October 1993 when Yeltsin launched a coup d'etat to preserve the "stability" of the regime against those on the streets opposed to IMF shock therapy, a policy supported consistently by The Economist that Lucas is a propagandist for.

Lucas never mentions shock therapy in any detail in The New Cold War. He does not even use the term nor mention in detail the role of Harvard economists, the IMF nor the way in which large sections of the middle class were reduced to penury by the "reforms" of Gaidar and Chubais.

It s the sheer scale of the omission that makes The New Cold War a sensationalistic book replete with cliched journalese, that it is a "wake up call" to the West and that Putin's rise to power from within the FSB, the successor to the KGB, something uniquely sinister, as though he had been reading too mant trashy Frederick Forsyth novels.

The French novelist Michel Houellebecq lampooned this author in Platform when he wrote of Forsyth's novels what could easily be applied to The New Cold War,

" I picked up a shitty Anglo-Saxon best seller by one Frederick Forsyth. I had read something by this halfwit, full of heavy handed eulogies to Margaret Thatcher and ludicrous depictions of the USSR as the evil empire. I leafed through his new opus: apparently, this time, the roles of the bad guys were played by Serb nationalists; here was a man who had kept up to date with current affairs. As for his beloved hero Jason Monk, he had gone into service with the CIA, which had formed an alliance with the Chechen mafia...what a charming sense of morality best selling British authors have."

Such morality is on full display in The New Cold War as the essential fact that Putin's rise to power was consolidated as much by the fact he attempted to claw back power from oligarchs such as Boris Berezovsky and Mikhail Khodorkovsky of Yukos oil who used insider dealing and corruption, not to mention contract killing, to build up his economic empire.

Naturally, Lucas omits all that and the way the oligarchs used ex-FSB goons themselves to protect their power, with Western investors, no doubt those who are earnest Economist readers, never having cared much for the ethics of such people as they effectively looted the Russian economy whilst most Russians fell into appalling poverty.

Misha Glenny in McMafia: Seriously Organised Crime took a sane line when, though being rightly critical of Putin , writes that,

"The rape of Russia's assets enjoys pride of place in the boom of the global shadow economy in the 1990s. Not only did the oligarchs succeed in turning Russia upside down, but their actions had a huge economic and social impact on countries throughout Western Europe, in the United States, in the Mediterranean, in the Middle East and Africa, and in the Far East".

They operated protection rackets as did the Chechen mafia which also secured a dominant role in Moscow's criminal mafia life and was inherent in the way shock therapy, the overnight liberalisation of prices and mass privatisation in 1992 was foisted on Russia were the state had not had time to implement the rule of law in Russia.

That, if anything, was responsible in Russia for creating the anarcho-capitalism that Putin has at least tried to rein in since coming to power. None of that concerns Lucas as his agenda has been to simply posit Russia as a threat to Russia and the West in order to advance US and transatlanticist expansion and more of the same neoliberal policies that created the chaos.

Glenny is scathing at the incompetence of Yeltsin's "self styled 'kamikaze cabinet'" of Gaidar and Chubais. As Oleg Davydov at the Ministry of Trade opined ' We dismantled everything..we began liberalisation in the absence of any controls'. This Market Bolshevism, as Noble Prize winning economist Joseph Stiglitz termed it, was catastrophic for ordinary Russians.

The prices that were essential for millions of ordinary Russians-bread and rents- were "liberalised" and these policies simply can not be wished away on Gorbachev printing more money as Lucas claims. Gaidar ramped up these prices whilst artificially holding down the prices of Russia's copious natural resources-oil, gas, diamonds etc.

The inevitable result of these neoliberal policies that Lucas supports was as Glenny suggests 'a license to print money' and a new economic class of traders bought these assets for a fraction of their real worth, those like the rapacious Mikhail Khodorkovsky whom Lucas sees as a sterling example of the new entrepreneurial zeal.

The Trade Ministry bought up oil and diamonds at the Soviet subsidised prices and then sold them on to Western investors at the global market price with the oligarchs creaming off the huge profits and protecting their position by hiring ex-KGB members as privatised security guards. Robber barons like Berezovsky and Khodorkovsky literally made a killing.

Glenny, in contrast to the idiocy of Lucas' whitewashing of the entire process in The New Cold War, writes that,

"The process of enrichment was quite simply the grandest larceny in history and stands no historical comparison. As the New Russia dressed itself up to look like a responsible capitalist economy that was attractive to foreign investment, its most powerful capitalists were raiding its key commodities, trading them for dollars and then exporting these funds out of the country".

The Russian economy was looted to a tune of some $300 billion dollars, a fact never mentioned by Lucas in at least understanding why Putin when he came to power was intent on imposing in such chaos what he called 'the dictatorship of law'. Lucas lauds what radical writer Naomi Klein calls a "sadistic economic experiment" without question.

This makes a farce of Lucas' insistence that Putin's emergence to power in 1999-2000 was somehow wholly unexpected as the new Russian leader new that without rebuilding the state, Russia would become a kind of plundered semi-colony controlled by oligarchs in tandem with Western investors and US geopoliticians like Brzezinski who craved a weak Russia.

This is essentially the kind of Russia that Lucas values, Brzezinski's "Black Hole", a Russia reduced if possible to a weakly centralised state in which Western companies could take easy pickings. The New Cold War is Lucas' propaganda term for the backlash against this imposition of a US style economy on a Russian military-industrial rust belt unsuited to it.

Consequently, Lucas resorts to Leninist style abuse about the rise of "Mr Putin", glides over the total immiseration caused by the "Young Reformers" and their 'kamikaze cabinet', and just has recourse to trite anti-communist propaganda riffs and drivel about Putin being a potential Mussolini, New Tsar, neo-Soviet threat and a reversion to the 1930s etc etc.

Such propaganda is of the same kidney as that used against Saddam Hussein to rationalise the neoconservatives invasion of Iraq in 2003, an oil grab and an attempt to install another neoliberal Utopia via military power. Praising Khodorkovsky, Lucas writes with his penchant for mendacious euphemisms, that,

"Only Mikhail Khodorkovsky, the founder and main shareholder of the Yukos oil company, was prepared to stand up to the Kremlin. His company was the best run of all the Russian business empires. It had a controversial and even ( some said ) bloody start"

This in practice meant the use of contract killings of a mayor and an oil refinery manager who Lucas blithely opines "met early deaths" as if they had eaten bad sushi or been poisoned. He has difficulty using words like 'murder' and 'killing' because the facts do not fit in with the idea that Putin is a kind of 'dictator'.

Irrespective of Khodorkovsky's later careful use of media power to portray himself as a "political prisoner", one that flashes across the Internet and is prmoted on Facebook for credulous fools who see him as hard done by when he was arrested by the Putin regime, he was a robber baron from the start.

All Lucas can pathetically muster in defence of this man was that he was seen as a political rival to Putin which he was and, what is more, a man who was not elected by Russians and used his ill gotten business empire to meddle in politics to the extent of supporting the Iraq War and "friendly relations with America".

There is no reason why Putin or the Russian people should have tolerated Khodorkovsky's megalomania at the behest of US corporations who wanted a stake in a proposed merger of Yukos with another Russian oil giant Sibneft. This would have led to greater US control over the Russian economy that would not be tolerated if Gazprom tried to take over US oil firms.

For control over energy is part not of a "New Cold War" but of a reversion to a New Great Game in which political hegemony and global power is predicated on control over vital oil and gas reserves not only in Russia but also in Central Asia. That game plan is the one Lucas supports and Putin thwarted it, which is why Lucas is so infuriated by the Russian leader.

Misha Glenny, an intelligent liberal, has no truck with such special pleading from repellent and inordinately greedy oligarchs such as Khodorkhovsky and Berezovsky when in McMafia he states,

'Under Putin the Kremlin has clipped the wings of several of the most powerful oligarchs. From exile or inside prison Boris Berzovsky and Mikhail Khodorkovsky warn the new President is the reincarnation of Stalin. But he isn't. He has fashioned a novel system that brings together aspects of capitalism and Soviet socialism-market authoritarianism. The oligarchs desperate attempts to portray Putin as the new Stalin seek to conceal the primary responsibility they bear for the mess in which they and Russia find themselves'.

The best Lucas can do as a staunch advocate of rapacious oligarch power is to use the switch and bait technique of obfuscating the crimes of the oligarchs and focusing his ire on "Mr Putin" in an increasingly shrill manner, terming Putin and his supporters as subtle KGB manipulators who seized power whilst they were FSB operatives who did not work for the oligarchs.

When FSB spooks work for the oligarchs this is rationalised out of consideration, no matter how much suffering, murder and killing they unleashed, but when Putin used them, having been in the KGB himself along with other political supporters, then he is portrayed as uniquely sly, a "mere mouse" who scuttled around the Kremlin and was "wooden" in 1999.

Ignoring the fact that the 1998 economic crash and the depreciation of the rouble paradoxically showed the total failure of the IMF Washington Consensus across the globe, from Argentina to Thailand, Lucas then ignores the way in which it made Russian exports competitive again and led to economic revival.

The reforms that Lucas lauded when Russia was controlled by the USA and the IMF advisors suddenly, after Putin's ascent to power, become a sinister attempt to concentrate power and crush dissent, as "the mouse had a taste for economic magic" by introducing a flat tax rate of 13% in 2001 and that "the results were impressive" ( page 18).

The fact that Putin continued 'crony capitalism' or an authoritarian managerial form of government without the control that Western investors and corporations had in the 1990s is the real issue at stake that piques Lucas. The lack of interest in the human effects of shock therapy proves that the interest in human rights is fraudulent.

That is not to say that human rights abuses in Russia are not worthy of criticism as they undoubtedly are but the right to a basic standard of living and security are also human rights too and ones that Western nations, interested in using human rights for realpolitik objectives, discredit by attaching them to poverty inducing so-called neoliberal "reforms".

To assume that Russians are willing to trade off "freedom" for the illusions of security has no traction in a country where there was both no freedom and no security because the Russian state had collapsed. Lucas would most likely want such a "regime change" in Russia as in the 1990s but it simply will not happen.

The contradictions and Orwellian doublethink in the New Great Game that Lucas is a propagandist for are shown in the fact he keeps referring to Russia's middle class doing well in the 1990s on the one hand ( 'The Yeltsin years were good for many of this phantom middle class, at least initially' ) with his admission later that under Putin,

"never in Russian history have so many Russians lived so well and so freely. That is a proud boast, that even those who dislike Russia's current path must honestly acknowledge"

The point Lucas misses is that these middle classes are not synonymous with the "New Russians" of the Yeltsin period which saw the reduction of middle class Russians to having to peddle family heirlooms on the streets of St Petersburg and Moscow. One reason why despite a semi-democratic managed democracy, most Russians hate Yeltsin and prefer Putin.

Yet to suggest that this is rather like the Germans living under Hitler is idiot hyperbole. Russia has always been a hybrid of Western and Eastern influences and there is simply no realistic way that Russians are ever going to trust the same "reformers" sponsored by the West, in particular the USA, ever again after what was done to them in the 1990s.

As Russia's middle class grows and its new wealth spreads, the liberalism it will in time demand will be a domestic home grown one and not a list of candidates drawn up by the USA's NGO networks and led by hirelings in The Other Russia, what Anatol Lieven terms correctly as "Limousine Liberals".

The statistics Lucas cites are proof that middle class Russians will not want a reversion to the 1990s. They have become the 9th largest spenders on tourism in the world, taking 1.47m trips to Turkey, a historical enemy with whom Russia is now enjoying unprecedented trade with and has no need to upset relations with, one reason Turkey is doing oil and gas deal with Russia.

By contrast, Turkey is turning away from US policy in the Middle East and the idea of a New Cold War with Russia as they perceive that Cold Warrior rhetoric is stupid and destabilising, not least as Israel has become a state bent on perpetuating aggressive policies such as the invasion of Iraq and imposing draconian measures on the Palestinians.

The connection with the Russian losers of the 1990s is clear: most oligarchs egging on the New Cold War are those like Berezovsky and other Russian mafia operatives who now traffic sex slaves into Tel Aviv. Both Berzovsky and Vladimir Gusinsky have Israeli citizenship and have colonised Israel as a great place to invest their ill gotten gains and money laundering schemes.

One of the most forthright far right advocates of neoconservative Israeli foreign policy is the former "dissident" Natan Sharansky who advocated the cause of the Russian oligarchs whose investment in Israel is colossal and led to the creation in 1995 of the Yisra'el Ba'aliyah and acted as a pro-US lobby group for Israeli interests in Washington.

The result is that such parties and the Likud, which regards Arabs virtually as untermensch, are now funded by gangster capital and involved in drug smuggling, prostitution, and other rackets. The decline of Israel's democracy has proceeded apace as massive flows of oligarch capital has been directed to low or cheap labour enterprises.

Just as in Saakashvili's mafia and clan ridden oligarchical regime in Georgia, a close ally of Israel, the result in that far right nationalists spend a disproportionate amount of national income on 'defence' and weapons dealing, with 70% of Saakashvili's armoury coming from Israel.

As such inward investment has distorted the Israeli economy and made it increasingly dependent upon the cheap sub-class of labour provided by the Palestinians trafficked from Gaza and the West Bank or Romanians, Uzbeks, Tatars, Thais and Filipinos, social inequality and diversionary conflicts are seen as an escape forwards-as in Georgia.

This is one reason why Russian foreign policy is hostile to Israel: it has nothing to do with "Neo-Stalinism" or the anti-semitism of Russian elite thinking. The Soviet Union's tactic of supporting Arab secular nationalists in the Middle East has not drifted into another offensive there by Russia.

It has been, as the Iraq War has proved, that Israel and Georgia are increasingly driven to militarism by the influence of neoconservatives under Bush II but also due the the power of the Israeli lobby in Washington and the bi-lateral weapon and trade ties. Lucas , of course, only sees Russian machinations at work.

Whilst claiming in Chapter 8 of The New Cold War ,"Sabre Rattled or Sabre Rattling-Russia's Foreign Policy Unpicked, it is Russia that is being opportunist in presenting a threat to the Middle East by flirting with "The Muslim Cause". Despite the fact, there is no 'the Muslim Cause' to be supported.

Just as Russia is crudely portrayed as an "existential threat", so too does Lucas prove his equally vulgar interpretation of the Middle East as being united in Arab states by a singles "Muslim Cause" which is there to support or exploit. This absurdity is furthered when Lucas writes,

'Muslims appreciate Russia as a counterweight to American influence, and as a possible source of useful weapons ( officially or unofficially )'.

It's as if Lucas thinks in pure neoconservative terms of "Muslims" all being at one in hating Israel just because they are Muslims when not all Muslims, a religion of 1.3 billion people, think and feel the same. Such a statement is simply reductionist, idiotic and panders to far- right Israeli racism against all Muslims.

The term is that Islamists might seek Russia as a counterweight to US influence. Even then, Iran is hardly likely to back Sunni Muslims of the Taliban in Afghanistan who persecuted Shi'ites. Nor are all Islamists part of one unified cause as communists were to a far greater extent in Europe in the 1920s and 1930s.

As elsewhere, there is no New Cold War with Muslims or Islamists taking the place of Communists and Nazis, but regional conflicts over resources like water and, of course, oil: the latter lying at the heart of what is a New Great Game as emerging Great Powers far more threatening to Western hegemony rise such as China.

Lucas has no evidence of Russia really posing a New Cold War threat to the Middle East, though in light of the Iraq War and the potential implosion of the region into ethnic irredentism because of it, the threat has to be inverted as coming from Russia because it would otherwise be difficult to explain the chaos there as a result of UK, US and Israel.

What Lucas completely omits is that Russian anti-semitism ( another essentialist smear on an entire civilisation ) has not been responsible for mass Jewish emigration to Israel: it's simply a fact that Russian Jewish oligarchs wanted to gain economic power there and poorer Jews wanted to migrate to a richer nation.

But if one took Lucas' crude stereotype of "Muslims" wanting to ally with Russia, then the corollary would be that "Jews" want to ally with the USA, which would pander to anti-semitic prejudices that in the case of "the Jews" is politically incorrect but with "Muslims" is portrayed as wholly natural.

No mention of the flight of the Russian oligarchs and their booty to Israel is mentioned by Lucas and it is only Russia which "could" or "might" aid "Muslims" because of a few rhetorical remarks made by Putin about the US invasion of Iraq, which was, a catastrophe and depending on one's viewpoint not in accordance with the rule of law and Western "norms" he invokes.

Bibliography

Edward Lucas, The New Cold War.
Misha Glenny, McMafia: Seriously Organised Crime.
Naomi Klein, The Shock Doctrine.
Michel Houellebecq, Platform.