The enduring reality of government by wealth and some of its consequences
By John Chuckman | Aletho News | April 2, 2015
If you really want to understand the world in which we live – its endless wars, coups, interventions, and brutality towards great masses of people – you need to start with a correct understanding of the political machinery at work. Talk of liberal interventions or fighting for rights, Western values, and democracy are hopelessly naïve and mostly deliberately deceptive. America’s record in such matters is one of securing everything from bananas, copper, and crude oil concessions to, at the very least, foreign governments obedient to its mandates after removing a disliked leader, whether elected or not. There is no concern for principles outside of their being featured in blowhard, insincere political speeches. The interests of America’s government do not match the interests of ordinary people, those in America or anywhere else, and, were the informed consent of the governed genuinely involved in launching bloody adventures, they likely never would happen.
The underlying reality of how people in the West are governed now compared to hundreds of years ago is surprisingly unchanged, much the way the rules governing how chemical bonds form have not changed despite a long and great parade of events and discoveries in the visible world. Despite all the revolts, revolutions, congresses, constitutions, and great movements over the centuries, we are in fact governed in the same essential way people were.
Of course to see this, you have to strip away the forms and rituals we have constructed over the centuries, forms and rituals which create impressive effects much like the green smoke and thunderous voice of the Wizard of Oz, a wizened old man who worked from his curtained control room, pulling levers and hitting buttons to create intimidating effects. Most Americans remain impressed with the smoke and thunder and cheap magic tricks, it requiring some dedicated effort to shake off well-done illusions, and, as I’ve written before, Americans work extremely hard in their jobs or live a kind of marginal life trying to scrape by on low wages or part-time work, either of which situations leaves little time or inclination to question what government is really doing and for whose benefit.
And so long as America remains under the rule of wealth, it is unlikely other states, as in Western Europe, will emerge from it because America’s establishment has such decisive influence – economic, financial, military, and political – over many of them.
What is considered as wealth changes over time and with economic development, and with those changes so do its interests as well as the practices of its power. Great deposits of copper ore or crude oil In the Middle Ages were virtually worthless. Wealth then was land for agriculture, forestry, and hunting, with the family names of owners determined by their estates. The revenue from that natural wealth was converted to great houses and jewels and the implements of war. War, too, was a source of wealth with most wars being little more than adventures for dominance and looting on a grand scale. Again, as in our own day, they were dressed up with slogans about principles or causes which had almost no meaning. The case of the “Christian” Crusades, which continued their pillaging and orgy of killing, on and off, for centuries, springs to mind. Soldiers and sailors, up until modern times, were not motivated by their paltry pay and poor supplies, it being understood as a condition of employment that they would enjoy a share of the bounty looted in any campaign.
Today, the forms of wealth are as diverse and complex as is our society, and many of them are not apparent to ordinary people in the way great estates and hunting rights and obligations in war and peace to great lords were apparent in 800. Even as late as, say, 1850, wealth in the form of belching factories employing armies of people was often still quite apparent, but today’s complex banking and securities and financial institutions are not well understood by most people, although they represent immense wealth just as real in its demands and power as estates and obligations of the 9th century. Wealth today also comes from huge global manufacturing concerns of every description often with operations scattered out of sight, great shipping and transportation fleets, or electronic and communications empires. Land itself remains an important form of wealth where it can produce industrial-scale crops or contains deposits of valuable minerals or can generate flows of electricity or has been developed into great cities or resorts. War remains a source of wealth, only on a scale which could not have been imagined a few hundred years ago, but the spoils no longer go to soldiers in professional armies, they go to those responsible for the war, often in forms not easily recognized, as with special rights and concessions and secret arrangements.
As the nature of wealth evolved from the Middle Ages to the Modern Era, outward forms and rituals of government also changed. We have moved from the near-absolute power of kings and autocrats through aristocracies and republics with senates to a great variety of forms, parliaments and congresses, which appear designed to yield, to one degree or another, the consent of the governed.
But appearances, as in the case of the Wizard of Oz, can be deceiving.
Today, a single wealthy individual cannot make the kind of demands upon ordinary people that marked arrangements in the Middle Ages – although that must be qualified as I’m sure anyone who has become involved in a dispute with a wealthy neighbor or a great corporation will be happy to explain – but the class of wealthy people can indeed make just such demands, and they do so all the time. You will be taxed to pay for the schemes that their lobbying establishes, your water and air will contain the pollution of their manufacturing and mining, your children will be sent to kill and die in their wars, the ethics or morals you were taught as a child will be trampled upon, and virtually all important legislation will deal with the rights and interests of wealth, and not those of the broad mass of people.
In America, once in four years you will be asked to choose between two names, both of which have been closely vetted by the powers that be, to elect as head of government. Not only have they been vetted, but the immense costs of their campaigns in reaching you on television, at rallies, and with opinion polls to regularly fine tune their words will be paid almost exclusively by those whose real interests are at stake in every major election, the wealthy and their important serving institutions of government. The end effect is not really all that different than the old single-candidate Soviet elections at which the press trained Americans to sneer.
Many of America’s founding fathers had dark suspicions about the existence of wealth being secure in the presence of democratic government, and that is why they created forms – mostly adapted from Britain, a place no one regarded as a democracy then – to keep wealth safe. Over a couple of centuries, the original arrangements were modified, the country moving from a tiny one percent or so privileged voters – for perspective, that’s roughly the same as the percent of voters in China’s Communist Party deciding who rules the country – to something approaching universal suffrage, but always arrangements were made to safeguard wealth against the assumed predations of democracy.
In elections for the American Senate, the legislative body with real power, authority, and privilege, you again will be asked to choose between two well-vetted and well-connected candidates. Others may run, but they will be rendered helpless by the vetted candidates’ flood of money and resources, you will never hear their voices, and America’s press – itself an empire of wealth serving wealth – will waste no time on their views. In the case of the Senate, you will be asked once in six years to vote, with the elections staggered so that only one-third of that body faces election at any time – a perfectly-conceived formula for keeping the old bunch in charge despite issues which might have generated election discontent. In fact, you can never “throw the bums out” in America. Anyway, there really isn’t much risk for Senators running for re-election, with incumbents winning about 95% of the time. Senate seats are so secure they sometimes become family sinecures, handed down from father to son. After the election, unless you live in a small-population, insignificant state, you will never see or meet your Senator, and you will certainly have no opportunity to lobby. Virtually all seeing, meeting, and lobbying will be done by the wealthy sponsors of the successful candidates or by their hired help.
The average American Senator is said to spend two-thirds of his or her time securing funds for the next election, and such elections have now been bid-up to unbelievable amounts of money. The huge costs serve as what economists call “a barrier to entry,” a kind of high financial wall which keeps others from entering the political market, or, if somehow they do manage to enter, keeps them from effectively competing. Only the other wealth-vetted and connected candidate will have any hope of collecting a big enough pot of money to threaten an incumbent. The belief that people giving millions of dollars to candidates expect nothing in return is not even worth discussing. What they get – apart from goodies like important and prestigious appointments or valuable government contracts – is access, and access is exactly what most people never enjoy. Intimate access to politicians in high office, people always mindful of the necessity for another overflowing campaign war chest, is genuine power.
It is not impossible to have compatibility between democracy and wealth, but it requires a set of laws and regulations concerned with campaign financing, lobbying, and dis-establishing a political duopoly of two privileged parties, laws which simply cannot happen in America over our lifetimes. In America, law makes corporations persons, and the highest court, packed by judges appointed to serve wealth’s interests, has ruled that campaign money is free speech. These are not things easily turned around.
The American system of campaign financing not only assures the secure power of domestic wealth, it assures also the influence of wealthy lobbies serving the interests of foreign states, Israel being the most outstanding example. Other foreign states also exploit this system to varying degrees, but no other state has more than five million American citizens in great part keen to serve its interests. And many of them are successful, affluent, and well-placed people enjoying a connected set of organizations and well-funded lobbies. Other foreign states also do not enjoy having many of their lobbyists in America being dual-citizens, free to move back and forth between the country being lobbied and the country being lobbied for, surely an ethical issue for politics and foreign affairs of the first magnitude. It is a unique situation in many respects, and it has helped create a unique set of problems in the world.
The wealthy interests of America happen to share some important interests with lobbyists for Israel, including securing [or limiting competition to] the Western world’s supply of energy and not permitting the rise of states of any power in the Middle East who disagree with America’s essential views. It is important to keep in mind that “America’s essential views” are not necessarily the views of most of the American people and that many of those “essential views” have never received genuine informed consent. Elections conducted the way America’s high-level elections are conducted are incapable of bestowing meaningful consent, especially in vitally important matters.
The Israeli-American alliance is something of an unholy one because in binding America so closely to Israel, some huge and unresolvable conflicts have been created. Israel is associated with a long series of wars and abuses in the region, and, ipso facto, so is America. Israel, given the nature of its founding, expansion, and practices, is not liked by any neighboring states, although many now cooperate secretly, and sometimes even openly, in areas of mutual interest and have learned to tolerate its existence, the way generally eased by large American bribes or equally large American threats.
Traditionally, states in the Middle East are not democracies. Their often short histories have given limited opportunity for wide-spread development and prosperity creating a strong middle-class, the sine qua non for democracy. With the United States always (insincerely) praising democracy – including Israel’s grotesque contradiction of “democracy for some but not others” – it has been caught in a bind between supporting what it says it opposes and opposing what it says it supports.
Its proposed solution was a huge CIA project, nick-named “the Arab Spring” by America’s wealth-serving and often dishonest press, a set of manufactured uprisings intended to bring a semblance of democracy to the region. It has been largely a failure, ending with some countries trapped in chaos or civil war and others, notably Egypt, briefly gaining a government Israel hated intensely, the truth being that genuine democracy in virtually any of these countries will not be friendly to Israel’s geopolitical ambitions in the region nor to those of its American promoter and protector. While the “Arab Spring” was allowed to proceed in some states, in others, where it was neither intended nor desired, such as Saudi Arabia or Bahrain, spill-over effects were deliberately and violently suppressed with American assistance. So the American-Israeli relationship now still locks the United States effectively in fighting against democracy in some countries and in supporting absolute monarchs and oligarchs in others, while in still others, such as Syria and Iraq, it is involved literally in smashing them as states, in violation of all international law and long-term good sense.
The entire situation is an ongoing disaster and is almost certainly not sustainable over the long term. How do you insist a huge country like Egypt remain a backwater without democratic rights indefinitely? How can you justify the destruction of an ancient and beautiful country like Syria? How can you justify supporting absolute monarchs and keeping their people in total political darkness? How do you continue supporting Israel in its abuse of millions, depriving them of every human right, or in its constant aggression to secure its hegemony? The drive for regional hegemony is all that is behind Israel’s constant hectoring of Iran, and how is that behavior different to the aggressive wars condemned by the Nuremburg Tribunal? It’s not, of course. Further, destructive, deliberately-induced conflicts like that in Syria, by degrading its economic advance, only slow the day for democracy’s having a real chance to emerge.
So here is America, self-proclaimed land of the free, mired in a vast situation where it works to suppress democracy, supports tyrants, and supports aggressive war because its leaders, with no genuine consent of the governed, have put it there, and this is just one of many unhealthy and destructive consequences of wealth’s rule in the United States. Wealth has no inherent interest in democracy, and it is entirely up to a people anywhere to demand respect for democracy through laws.
Soros Looks to Co-Own Ukraine
By Alex Freeman • TFC • March 30, 2015
Vienna, Austria – Billionaire hedge fund manager George Soros has proposed a $1 Billion contribution of a combined $50 Billion investment package in the Ukraine in order to form an economic barrier to Russia’s entry to the war torn nation. In an interview with an Austrian newspaper, Soros said, “The West can help Ukraine by increasing attractiveness for investors.” The Hungarian-born economic hitman may be more interested in helping his, and other investor’s, pockets, rather than the people of Ukraine. The speculation here could undermine any truly democratic action in Ukraine. By using low EU Central Bank interest rates to achieve his investments, Soros’s plans begin to bear marked similarities to speculations that destroyed the British Pound and took severe tolls in places like Argentina.
The business model is nothing new for Soros, who has engaged in similar investment projects in West Africa. He continues, “There are concrete investment ideas, for example in agriculture and infrastructure projects. I would put in $1 billion. This must generate a profit. My foundation would benefit from this … Private engagement needs strong political leadership.” In Nigeria, Cameroon, Uganda and others, Soros has leveraged his political connections to protect his business interests in those nations. Revenue Watch International, a Soros firm, assisted Uganda in the development of its fossil fuel drilling regulations. Open Society Institute, another Soros Non-Governmental Organization, has recently been responsible for setting up and later overthrowing presidents of Senegal and Congo. Soros maintains significant oil, gold and diamond drilling operations in these nations. The International Crisis Group, yet another Soros NGO, has repeatedly advised the US Government to provide American military intervention in these fragile societies heavy in natural resources.
The profits would certainly roll in for the relentless investor. Soros Fund Management, LLC maintains ownership of large share percentages in key corporations that will benefit from investment in Ukraine. Soros owns over 5 million shares of the chemical giant Dow Chemicals, with diversified products and services from industrial to agricultural applications. Another big agricultural winner would be Monsanto. Soros owns half a million shares of the bio-tech firm, which has been a part of most Ukraine political discussions since the civil conflict broke out two years ago. Ukraine has vast supplies of oil and natural gas. Energen, a natural gas utility, could be a prime developer of Ukraine’s fossil fuel reserves. Soros owns nearly two million shares of that company. PDC Energy, with one million shares owned, might be another contender for drilling profits. Soros also owns significant stakes of Citigroup, which stands to be a primary financial intermediary for any investment in Ukraine.
Soros’ investment strategy is not restricted to diversified holdings of major national and international corporations or mutual funds. A significant tactic is the investment in supportive elements within the US government. In 2014, Soros ranked 11th on OpenSecrets.org list of “Top Individual Contributors.” His nearly $4 Million open investment (contributions sourced directly to him and not channeled through 501c4 “dark money” organizations) could potentially amount to $400 Million dollars in returns, if not more. The Carmen Group, for instance, a lobbying company in Washington, has claimed that for every dollar invested in lobbying, their clients receive $100 in return. RepresentUs, a campaign finance reform advocacy group, has measured similar extensive gains for political contributions and lobbying expenditures.
United Republic Infographic for Return on Lobbying Investment
If Soros senses a $100 Billion profit, diversified through a number of companies he holds stakes in, he will not mind selling other countries, individual investors, or the IMF to provide the remainder of the $50 Billion total investment he thinks Ukraine needs. In fact, this was probably a major conversation topic this year at the Davos World Economic Forum meeting. The majority of these banks and corporations, however, will mine the profits from Ukraine, exporting them to other Western nations. Meanwhile, these corporations will burden Ukraine with significant loans, even if the rates are near zero. Even though these practices have devastated countries like Greece and Argentina, as long as the profits keep rolling in, the investments will continue.
Nationalizing Britain’s railways could cut fares 10% – campaigners
RT | March 31, 2015
Britons could see train fares slashed by up to 10 percent if the railway network was brought back under public ownership, a study by campaigners has revealed.
Passengers struggling to pay for season tickets could benefit from “massive” savings if profits creamed off by private operators and shareholders were reinvested back into a nationalized railway service.
Research by Action for Rail found that £1.5 billion could be saved over the next five years, as contracts held by 11 private firms operating the rail network come up for renewal.
With the potential savings, campaigners claim the government could introduce free off-peak travel for children traveling with their parents, season tickets could be cut by 10 percent by 2017 and by 2020 all ticket prices could be reduced by 3 percent.
Action for Rail estimated £520 million of savings could be made if shareholder dividends were given to the government.
The report comes as a poll of 1,000 voters found only 17 percent want railways to remain in the hands of private companies. The group We Own It, which compiled the results, said 40 percent of respondents wanted to see the whole network controlled by the state.
It follows separate research which revealed British travelers pay twice as much as a proportion of their salary on rail fares as passengers in Germany, France, Italy and Spain, where railways are publically owned.
The publication of the report also coincides with a day of action, with events held at more than 40 stations in the UK.
Frances O’Grady, TUC general secretary and chairman of Action for Rail, said: “The UK has the most expensive rail fares in all of Europe.
“If services were run by the public sector, it would make a big difference to families and hard-pressed commuters, who have suffered year after year of wage-busting fare increases under privatized rail.
“This report highlights once again the huge cost of privatization to taxpayers and passengers. Money that could be spent on making journeys cheaper is instead being siphoned off into shareholders’ pockets and wasted on bidding and other franchising costs.
“The case for an integrated rail network under public ownership is overwhelming.”
Transport will become a point of debate in the weeks leading up to the general election. The Labour Party is expected to broach the issue in its election manifesto, following comments from former Deputy PM John Prescott, who spoke in favor of ending privatization.
The only parties openly vying for re-nationalization are the Green Party and the Trade Unionist & Socialist Coalition.
A spokesman for the Rail Delivery Group, which represents Network Rail and train operators sounded a cautionary tone.
“The figures from Action for Rail should be taken with a large pinch of salt. Compared to the late 1990s, train companies are paying five times more money to government, largely because of phenomenal passenger growth on Britain’s railway, helping to fund big investment in better services.
“Increases to season tickets are regulated by government and operators offer a range of fares to suit the needs of different passengers, including some of the cheapest fares in Europe.”
Why the West is to blame for the crisis in Ukraine: the full story
Chris Nineham reviews Frontline Ukraine: Crisis in the Borderlands by Professor Richard Sakwa
WE ALL KNOW about of the fog of war, but the current coverage and commentary on the crisis in Ukraine arguably takes wartime disinformation to new levels.
Richard Sakwa’s new book is a rare and precious exception. It is clear and measured and carefully researched and it shows that the story we are told in the west about events inside Ukraine is deeply flawed.
More generally, it exposes the idea that Russia is the aggressor and the West the protector of Ukraine’s democratic will as a travesty of the truth. In short, Sakwa’s analysis is diametrically opposed to what passes for an explanation of the Ukraine crisis in the mainstream.
One of the book’s great strengths is that it sees the crisis as a product of two connected processes, one domestic, one geopolitical.
Far from being a straightforward expression of popular will, Sakwa details how the government that emerged from the Maidan protests in February 2014 represented the victory of a minority hardline anti-Russian Ukrainian nationalism.
But this minority could come to dominate, he argues, because of the context provided by an aggressive, US-led, Western foreign policy designed to assert Western control over Eastern Europe and, at least in its more hawkish versions, de-stabilise Russia.
The push to the east
Nato and the EU have been pushing steadily eastwards ever since the end of the Cold War, despite verbal assurances from a series of Western leaders that this would not happen.
Twelve countries have joined Nato in the region since 1991. Georgia and Ukraine were promised membership at the Nato Summit in Bucharest in 2008, despite repeated warnings from the Russian government that taking Nato to the Russian border would cause a security crisis of the first order. It was only the intercession of Germany and France that forced the US to put these plans on hold.
The push to the east continued in the form, amongst others, of a plan to get Ukraine to sign up to an ‘Association Agreement’ with the EU. It was this agreement, due to be signed in November 2013, which sparked the crisis. To grasp its significance it is important to understand just how closely tied Nato and the EU have become, especially since the Lisbon Treaty signed by EU members in 2007.
Article 4 in the proposed Association Agreement committed the signatories to ‘gradual convergence on foreign and security matters with the aim of Ukraine’s ever deeper involvement in the European Security area’ (p.76). As Sakwa puts it, “it is pure hypocrisy to argue that the EU is little more than an extended trading bloc: after Lisbon, it was institutionally a core part of the Atlantic security community, and had thus become geopolitical”. (p.255)
All parties involved must have known that this document, if signed, would have caused existential anxiety in Moscow. Defenders of the West’s drive to the east justify it as the reflection of the will of the people concerned.
This is disingenuous. As Western leaders themselves have publicly admitted, a campaign to buy Ukrainain hearts and minds has been running for decades. In 2013, US Assistant Secretary of State for European and Eurasian affairs, Victoria Nuland, publicly boasted of the fact that the US had invested $5 billion in ‘democracy promotion’ since 1991, a huge sum by USAID’s standards (p.86). It has since been revealed that the EU too spent 496 million on front groups in Ukraine between 2004 and 2013 (p.90).
And there was nothing democratic about the process. Discussions about the Association Agreement in fact took place behind the backs of the Ukrainian people and the text of the agreement was not available in Ukraine till the last moment (p.74). It actually contained very little in the way of assistance to Ukraine’s economy, and its centrepiece was a radical liberalisation of EU-Ukraine trade, a direct threat to the traditional economic relations between Ukraine and Russia.
In the end, for a mixture of reasons, President Yanokovich didn’t sign up to the deal. But the pressure to sign helped to polarise the debate in Ukraine. The meaning of the agreement was an open secret in Washington. In the words of Carl Gershman from the National Endowment for Democracy, while Ukraine was ‘the biggest prize’, there was, beyond that, an opportunity to put Putin ‘on the losing end not just in the near abroad but within Russia itself’. (p.75)
Internal impact
This concerted Western strategy to surround and weaken Russia had a profound impact on the internal politics of Ukraine. Sakwa explains well the complex history that links Ukraine and Russia, a history that can’t be reduced to simple formulas of colonial dependency. The long, indigenous tradition of seeing Ukraine as part of greater Russian union has resulted in Russian being the dominant language in most of the country despite ethnic Russians being a relatively small minority. (p.8)
For all the mixed motivations behind the Maidan protests, it was a hardline anti-Russian strand that came to dominate, first in the protests themselves and subsequently in the regime that emerged out of the forced removal of the Yanukovich government.
Western policy in general gave ballast to a hardline nationalist tradition in the country that saw Russia – and the Russian minorities within the country – as the enemies of Ukrainian nationalism.
This tradition centred on the historic figure of Stepan Bandera who collaborated with the German Nazis in atrocities against Jews, Poles and Russians in Ukraine during WW2. His followers formed SS divisions which were responsible for the deaths of up to half a million people. (pp16-17). A giant poster of Bandera hung by the side of the stage in the Maidan, and many leaders of the regime that came out of the Maidan saw him as part of their tradition.
The West was minutely involved in this process. The State Department’s Victoria Nuland visited Ukraine three times in the first few weeks of the Maidan protests (p.86). The famous February leaked phone call between her and the US ambassador in Ukraine in which Nuland said ‘fuck the EU’, showed the extent to which the US was pulling the strings and in which direction.
In the call Nuland judges that the relatively moderate nationalist Vitaly Klitschko, who had the backing of Germany and the EU, should be kept out of office and that Arseniey Yatsenhuk – ‘Yats’ she calls him – a man who turned out to be a hardline chauvinist, should be the key player. Yatsenyuk indeed became the acting Prime Minister in the new government.
The result, in Sakwa’s words, was that, ‘what had begun as a movement in support of ‘European values’ now became a struggle to assert a monist representation of Ukrainian nationhood. The amorphous liberal rhetoric gave way to a much harsher agenda of integrated nationhood, and the euphoria promoted a rash of ill-considered policies’ (p.94).
As President Yanukovich was impeached and the new government was installed, armed insurgents strutted around the debating chamber. Yatsenyuk’s government was a mixture of recycled oligarchs and hard-line nationalists and fascists. It contained only two ministers from the entire south and east of the country, the areas with closest ties to Russia.
Five cabinet positions out of 21 were taken by the far right Svoboda Party, despite the fact they had only received 8% of the seats in Parliament. The minister of justice and the deputy Prime Minister came from the Russophobic Svobada party and its founder, a man with a long record of ultra nationalist activism, Andriy Parubiy, became head of the NSDC security agency.
Provocations
One of the new government’s first acts was to vote to rescind a law guaranteeing the right to instate a second official language where there were significant minorities. Although the change in the law was blocked, the vote was correctly interpreted as an attack on Russian minorities across the country.
It was followed by the outlawing of the Ukrainian Communist Party and the establishment of a ‘special service’ to root out fifth columnists in the armed forces (p.137). A wave of physical assaults on Russians duly followed.
In Odessa, pro-Russian activists were driven from an encampment into a trade union building which was then torched, killing a minimum of 48, many hundreds according to locals. The massacre was hailed by one of the Maidan leaders, Dmytro Yarosh, as ‘another bright day in our national history’ (p.98).
This series of events made a civil war virtually inevitable. Uprisings in the east of the country were motivated by political resentments, opposition to neoliberal policies and other economic grievances against Kiev, but most of all by a sense of the need for self defence. Unlike the largely middle-class movement in Kiev, the anti-Maidan movement in the Donbass region was ‘lower-class, anti-oligarchic (and Russian nationalist)’ (p.149). It was not mainly separatist. A poll by the Pew Research Center in May 2014 found that 70 per cent of eastern Ukrainians wanted to keep the country intact, including 58 per cent of Russian speakers (p.149).
The view from the East
Sakwa carefully analyses Russia’s behaviour during the crisis. His conclusions are a frontal challenge to the West’s narrative that the crisis in the Ukraine was precipitated by Russian aggression. As he shows, this is the opposite of the truth.
After the collapse of the Soviet Union, successive governments embraced a Western orientation, even making tentative moves to join Nato. In contrast to the stereotype that has been so carefully constructed, in his first term, Putin, and his successor Medvedev, sought engagement and accommodation with the West and tried to establish structured relationships with Nato and the EU. This approach faltered according to Sakwa, because of repeated rebuffs from the West:
“Continued conflicts in the post-Soviet space, the inability to establish genuine relations with the EU and disappointment following Russia’s positive demarche in its attempt to reboot relations with the US after 9/11 all combined to sour Putin’s new realist project” p.31
Over the last decade and a half, the Russian foreign policy establishment has become more and more alarmed by the unilateralism of US foreign policy, particularly over the invasion of Iraq and the attack on Libya. The non-negotiated push eastwards by Nato and the EU could of course only be perceived as hostile.
Even in these circumstances, however, for Sakwa, Putin’s central concern was to maintain the status quo in Ukraine, and try and ensure a friendly or at least neutral buffer state based on a stable settlement within the multi-ethnic Ukrainian state.
The forced, Western-backed removal of the Yanukovich government created an immediate crisis for the Russian government. Putin reacted by running a popular poll and an armed operation to secure the secession of the Crimean region to the USSR. Given the level of hostility and the mobilisations against Russian minorities, this can have surprised no-one. The Crimea was part of Russia until 1954, and it contains Sevastopol, Russia’s only major warm-water naval base. The idea that the Russian ruling class was going to stand aside and allow this area to be taken by a pro-Nato and anti-Russian government was obvious fantasy.
But if Putin’s long-term plan had been to invade, partition or even to destabilise the rest of Ukraine, he would have taken the opportunity presented by the virtual collapse of the Ukrainian government in February last year and the anti-Kiev uprisings in the east of the country which developed as a result.
His response was in fact was very different. Sakwa argues that despite the hoopla in the Western media, with the exception of the special case in Crimea, there is little evidence of significant military intervention by Russia in the months after the crisis of February, at least until August.
Putin supported the rebels to try and gain some leverage, but when it came to military assistance the rebels in the east were denouncing Putin for not delivering it. In Sakwa’s words, “Russia used proxies in the Donbas to achieve its goals within Ukraine, but this was not an attempted ‘land-grab’ or even a challenge to the international system” (p.182).
On 24 June in fact, the Russian Federation Council revoked a ruling which had previously allowed Russian military involvement in Ukraine ‘in order to normalise and regulate the situation in the eastern regions of Ukraine’ in the run up to tripartite talks involving the new Prime Minister Poroshenko (p.162). But Poroshenko had been the continuity candidate. On taking office, he had issued a statement calling for ‘a united, single Ukraine’ and characterising insurgents in the south-east as ‘terrorists’ (p.161).
Sakwa, along with most other sane commentators, is far from idealising the authoritarian and sometimes aggressive Russian regime. He criticises its human rights record and its institutions of governance. If anything his instincts are with a reformed integrationist ‘wider European project’, which, given the behaviour of the actually-existing Western institutions, seems a bit of a forlorn hope.
But what Sakwa’s book does so well is to ask us to go beyond rhetoric and generalities and examine the actual dynamics of the particular situation in its national and international dimensions.
Most importantly, he argues, we can’t begin to understand the Ukrainian catastrophe unless we completely reject the dominant, not to say consensual, Western account of what is happening. This is a crisis created by the West, but by threatening Russia’s core interests, it contains the possibility of a catastrophic confrontation; ‘the US has sought to create a regime in its own image, while Russia has sought to prevent the creation of one hostile to its perceived interests’ he argues (p.255).
We in the West have a responsibility to do everything possible to force our leaders back from the brink.
See also:
Richard Sakwa: History returns with a vengeance in Ukraine
Jonathan Steele: Who is really responsible for the crisis in Ukraine boiling over?
US fines oil giant $232 million over Iran trade
Press TV – March 26, 2015
The US government has slapped oil services giant Schlumberger with a $232.7 million fine for “violating” its sanctions on Iran and Sudan.
The US Justice Department says the company had admitted “knowingly and willfully conspiring to violate” unilateral American sanctions.
The French-US services company is charged with secretly providing services to Iran and Sudan.
While Schlumberger Oilfield Holdings was allowed to work in both countries, the government says the fine involved the company’s US Drilling and Measurements unit which was not.
Schlumberger is incorporated in the British Virgin Islands.
“Over a period of years, Schlumberger Oilfield Holdings Ltd. conducted business with Iran and Sudan from the United States and took steps to disguise those business dealings,” John Carlin, US assistant attorney general for national security, was quoted as saying.
US companies have coveted Iran’s lucrative energy sector with utmost attention despite unilateral American sanctions which are in place since the Islamic Revolution.
They see the punishments a case of lost opportunities where European and Asian rivals have used the absence to their advantage.
According to the Economist, citing unnamed foreign businessmen, American enterprises are using local middlemen to seal initial deals in Iran.
“If there is a nuclear deal (with Iran), you will find overnight that the Americans have signed one-year options on the best projects,” the weekly newspaper recently quoted one middleman as saying.
“The Europeans will be queuing up, but they will end up negotiating with ExxonMobil and Chevron, just as happened in Libya,” he said.
The Roots of Netanyahu’s Electoral Victory: Colonial Expansion and Fascist Ideology
By James Petras :: 03.24.2015
“It is always a meritorious deed to get hold of a Palestinian’s possessions” – The code of Jewish Law revised and updated by Benjamin Netanyahu
Benjamin Netanyahu’s re-election makes him the longest serving prime minister in Israel’s history. His 20% margin of victory (30 Knesset seats to 24 for his nearest opponent) underlines the mass base of his consolidation of power.
Most critical commentators cite Netanyahu’s racist pronouncements; his rejection of any two state solution and his overt appeal for a mass Jewish voter turnout to counteract the ‘droves of Arab voters’ for his electoral victories.
There is no question that the majority of Israeli Jewish leaders and parties support Netanyahu’s racist pronouncements and ‘no-state’ solution and joined him in a coalition government. But the larger issue is the positive mass response to Netanyahu’s call to action. Nearly three quarters of the electorate turned out (73%) to elect him. Moreover, Netanyahu has been elected prime minister for four terms: between 1996-99 and more recently 2009-20.
What is more, the opposition has not differed from the Netanyahu coalition regime’s Judeo-centric policies and pronouncements. In other words, ‘racist’ ideology per se is not what drives the Israeli majority to repeatedly support Netanyahu.
Jewish-centered racism is an integral and accepted part of Israel’s political culture.
Social Colonialism and Netanyahu’s Popularity
There is a more fundamental, ongoing material basis which accounts for Netanyahu’s electoral victories and mass appeal: His regime’s aggressive, perpetual and escalating seizure and dispossession of Palestinians land and his massive financing of Israel’s Jewish colonial towns.
In other words, Netanyahu’s appeal is rooted in the large-scale, long-term housing which hundreds of thousands of low and middle income Israeli Jews have obtained via his brutal land-grabbing policy. The so-called ‘settlers’ are in part armed Israeli Jewish colonists who engage in open theft and defend Netanyahu, because they materially benefit from his policies… It is not only those who have already colonized Palestinian land grabbed after 1967 – over 650,000 Jews – who vote for Netanyahu, but there are the hundreds of thousands of others in Israel, priced out of the Israeli real estate bubble, who cannot afford comfortable housing and look to the West Bank and Jerusalem for a ‘Jewish solution’ at the expense of the Palestinian inhabitants.
Racism, the foul language directed at Palestinians, which pervades Israeli-Jewish culture (‘Arab scum’ is one of many such common expressions) found expression even among the songs celebrating Netanyahu’s latest electoral victory. Racism serves to justify the land grabbing. Can the settler mind even imagine that an ‘inferior people’ should complain about land grabs by the ‘chosen people’ ? Modern educated Jewish professionals wax indignant that shepherds and olive farmers should hold back the development of glitzy shopping malls, million dollar community centers (for Jews only, of course), hospitals, sports complexes and high tech industrial parks.
And if they – ‘the Arabs’ – object to their own displacement, all the better: Their resistance provides an excellent pretext for armed Jewish settler thugs to invade a village, drive out the inhabitant and call in Netanyahu’s bulldozers, as a prelude to establishing an ‘outpost’, first steps to a new Jews only colony!
The key to Netanyahu’s big vote is that he responds favorably and forcefully in favor of new colonies. The self-styled Israeli Defense (sic) Force (IDF) is dispatched to protect the local vandals and to shoot live ammo at any rock-throwing Palestinian adolescent defending the family patrimony.
Netanyahu acts and speaks for the rapacious Jewish colonial masses. The opposition criticized Netanyahu on the basis of his neglect of socio-economic issues in Israel, especially, the soaring prices of housing in the major cities. But they failed to attract many Jewish voters because Netanyahu offers a more attractive alternative solution – the seizure of more Palestinian land and the construction of Jewish homes, instead of fighting powerful Jewish real estate moguls, land speculators and corporate landlords inside Israel.
Extremism at the Service of Jewish Housing is No Vice
For the mass of Israeli Jews, looking for a cheap, easy and government-financed road to comfortable middle class housing, seizing and occupying Palestinian property is a very attractive and viable ‘solution’.
Netanyahu’s ‘final solution’ for the Palestinians – no state – is a guarantee that land, which is seized and housing which is built, will remain under Jewish jurisdiction. The ‘final solution’ for Palestinians is the housing solution for the Jewish masses.
Under Netanyahu, from 2013 to 2015, two-thirds of new housing construction (for Jews only) has taken place on stolen Palestinian lands. His regime spends $252 million dollars a year on Jews-only colonies (‘settlements’). The Netanyahu regime spends $950 for each Jewish colonist in the West Bank, double what is invested for each Jewish Israeli resident in Tel Aviv. For the most aggressive Jewish colonists, those who destroy the productive olive groves, torch Palestinian homes and who establish ‘settler outposts’, Netanyahu spends $1,483 a year . . . with promises of roads, electricity, schools, swimming pools and air conditioning to come!
Owning the Holy City Secures the Unsavory Vote
Netanyahu’s big vote in Jerusalem can be accounted for by the fact that over 300,000 Jews have been the beneficiaries of land grabs and sparkling high-rise condos in what had been centuries-old Palestinian neighborhoods.
Netanyahu assures the Jerusalem Jews that ‘their city’ is and always will be the capital of Israel, an undivided Jewish city.
Sticking his finger in the eyes of the EU and US officials, who claim otherwise, energizes and emboldens the Jewish voters
Netanyahu’s ethnic cleansing is unrelenting: That is why he is re-elected over and over again. Israeli colonial settlements grew by over 5% each year from 2009 – 2015. There is no backtracking with Bibi Netanyahu: at this rate of ‘erasure’ all of historical Palestine will be Judified by 2050 at the latest!
Netanyahu claims that Israeli Jews must have their ‘lebensraum’ . . .
Israel and other colonial powers, like England in the 19th century and Germany in the 20th century, ‘solve’ their domestic social problems and social unrest by exporting populations across borders. The attractiveness of this solution is that it preserves the power and privileges of the domestic economic elite and provides an ‘escape valve’ for the local disaffected masses.
Emigration to settler colonies requires violent dispossession of the local inhabitants. If stiff resistance emerges – the imperial powers resort to genocide; extermination of native peoples by the English, Slavic peoples by the Germans, Palestinian Arabs and other non-Jews by the Israeli Jews.
Long past is the notion that Israeli Jews would solve their social -economic problems via a collectivist economy and popular struggle against Jewish plutocrats.
Today Jewish-Israeli millionaires flourish alongside orthodox, secular, Sephardic, Ashkenazi, Sabra and Russian emigrant colonists. The former exploits labor and markets, while the latter dispossesses Palestinians. Netanyahu has discovered a formula for uniting quarrelsome Jewish parties, leaders and voters and for winning elections.
Moreover, Netanyahu has secured the financial and political backing of numerous overseas Jewish-Zionist billionaires. He has secured the unconditional support of tens of thousands of middle class Israel-First activists, academics and professionals who operate AIPAC and dozens of similar propaganda mills in Washington and Christian Zionists throughout the US. Netanyahu’s overseas backers ensure that the US government may grumble and criticize, but will never disrupt Netanyahu’s ‘plan’ of an ethnically pure ‘Greater Israel’ with Jerusalem as its ‘eternal’ capital. Obama may whine and talk to the press about ‘reconsidering US-Israeli relations’ but he has assured Israel and Netanyahu that military and economic ties will remain intact.
Conclusion
Netanyahu has succeeded in setting a colonial agenda for all Israeli-Jewish parties (bar one).
He has established the fact that competitive elections and opposition political parties are compatible and even facilitate violent colonial expansion.
He has established the fact that Israel and its people embrace a racist ideology and receive the endorsement of most Western leaders, and mass media and the unconditional support of its overseas fifth column.
Israel’s project for Palestine, the creation of a single Jewish state, is far more than the demented vision of one man. It has been taken to heart by the great mass of the Israeli-Jewish people and their overseas supporters. The victory of Netanyahu and his supporters marks a historic victory for all those regimes and people across the world who believe and fight for an imperial dominated world.
Wall Street Journal Gets the Numbers Wrong on Venezuelan Health Care Spending
By Mark Weisbrot | CEPR Americas Blog | March 20, 2015
I have sometimes noted that in the current “four legs good, two legs bad” discourse about Venezuela, journalists can write almost anything about the country and no one will question it – so long as it is something negative. On Saturday, March 13, the Wall Street Journal published this chart on its front page in the print edition, below, and claimed health care spending as a percent of economic output was “lower in Venezuela than in all other major economies in Latin America.” The chart shows Venezuela’s health care spending at 1.6 percent of GDP.

The chart and text don’t say it, but they are referring to public (i.e., government) spending on health care, which one can find by looking at the original data from the World Health Organization. When I read this, I thought, this can’t be true: The Venezuelan government spends about the same percentage of GDP on health care as Haiti? The lowest of 19 countries in the hemisphere? Less than some of the poorer countries in Sub-Saharan Africa? And these numbers are for 2012, when the economy was booming (5.7 percent real GDP growth), Venezuelan oil was at 103 dollars per barrel, and the government built more than 200,000 homes. They had no money for health care?
This should have set off some alarm bells at the WSJ, if any editors were paying attention. This number is not plausible because it is wrong. When the government of Hugo Chávez in Venezuela decided to make health care a priority after getting control over the national oil industry in 2003, it was unable to accomplish very much by going through the health ministry and the public hospitals – running into various bureaucratic and political obstacles. So it created Misión Barrio Adentro, a system of health clinics that served people in both urban and rural areas where many did not previously have access to health care.
The short story is that the numbers used by the WSJ apparently didn’t include most of Venezuela’s health care spending, since it has gone through the misiones. In 2012, the national oil company contributed $5.5 billion for Misión Barrio Adentro. Also, the government of Venezuela has an actual agreement with Cuba, which provides specifically for the supply medical care through Misión Barrio Adentro in exchange for 98,000 barrels of oil per day, which Venezuela has provided. The value of that oil in 2012 was $3.44 billion. The medical services include not only 40,000 doctors but also medical equipment, medicines, and other health care services.
If we add in these expenses, and use the IMF’s 2012 exchange rate to convert to domestic currency, this adds another 3 percent of GDP to the government’s health care spending.
This would bring Venezuela’s health care spending to 4.6 percent of GDP. In the above chart, that would move Venezuela from 19th to 7th place among the 19 countries shown. And this figure does not include all of Venezuela’s government health care spending.
(Note: the WSJ article also claims that “the share of state spending on health, at 6%” was also “lower in Venezuela than in all other major economies in Latin America.” This is also false, for the same reasons discussed above.)
UK creates ‘political & economic reform’ fund for Eastern Europe to contain Russia
RT | March 20, 2015
Prime Minister David Cameron has announced the creation of a money pot specifically designed to aid Eastern European countries in tackling any future ‘aggression’ from Russia.
The “Good Governance Fund” is aimed at strengthening democratic institutions in areas that are wary of Russia’s influence. The fund will total £20 million ($30 million, €28 million) in 2015 and 2016.
It is broken down into £5 million for Ukraine, and continuing grants for Moldova, Georgia, Bosnia-Herzegovina and Serbia.
The announcement comes as leaders of the European Union agreed to extend the economic sanctions currently in place against Russia until the end of 2015, in a move to force Moscow to undertake a full ceasefire in eastern Ukraine.
The Minsk Agreement was reached in February after lengthy talks, but the truce has remained shaky. There have been reports of continuing skirmishes between Ukrainian forces and rebels.
EU leaders have criticized Russian President Vladimir Putin’s alleged “web of influence” across Europe after the reunification of Crimea in March 2014.
Earlier this month, the prime minister of Crimea said the former Ukrainian territory had returned to its historical homeland.
Russia has also formed an alliance with Cyprus, after Putin agreed a £1.8 billion loan for the country in return for the use of its docks for Russian military vessels.
Putin further created powerful western European allies following Marine Le Pens visit to Russia in the autumn. Russia has agreed to loan her party, the right-wing Front National, £6.5 million.
The Kremlin’s interests also extend to Greece, where Putin offered support to anti-austerity party Syriza when it campaigned for the country’s withdrawal from NATO two years ago.
When the party came to power in January, the Russian ambassador to Athens was one of the first to visit Prime Minister Alexis Tspiras.
The new fund is based on a Cold War program created by Margaret Thatcher in 1989.
At the time, her “Know-How-Fund” was used to help countries that had recently left the Soviet Union to develop, such as Hungary and Poland.
Russia denies it is providing rebels in Ukraine with arms and assistance.
The conflict has cost over 6,000 lives to date.
U.S. Dominates Weapons Export Market as Profits Grow with Sales to the Middle East
By Noel Brinkerhoff | AllGov | March 17, 2015
The global arms trade business continues to thrive, with the United States being the biggest beneficiary of an ever-growing market that’s being fueled by Middle East purchases.
IHS Inc., an international information and analytics firm based in Colorado, reported in its Global Defense Trade Report that worldwide arms sales increased last year for the sixth straight year. The total in military trade went from $56.8 billion in 2013 to $64.4 billion in 2014—a 13.4% increase.
The U.S. was responsible for one-third of all defense exports and “was the main beneficiary of growth,” IHS reported. American exports of weapons were particularly popular among buyers in the Middle East.
Saudi Arabia surpassed India to become the largest defense market for U.S. weapons makers, as the oil sheikdom increased its defense imports 54% from 2013 to 2014. This year is expected to be another strong year for Saudi imports, IHS says, rising another 52% to $9.8 billion.
“One out of every seven dollars spent on defense imports in 2015 will be spent by Saudi Arabia,” according to IHS.
Ben Moores, senior defense analyst at IHS Aerospace, Defense & Security, said: “The Middle East is the biggest regional market, and there are $110 billion in opportunities in coming decade.”
To Learn More:
Saudi Arabia Replaces India as Largest Defence Market for US, IHS Study Says (IHS Inc.)
Charted: The World’s Biggest Arms Importers (by Alan Tovey, The Telegraph )
The SIPRI Top 100 Arms-Producing and Military Services Companies, 2013 (by Aude Fleurant and Sam Perlo-freeman, SIPRI) (pdf)
Obama Steps Up Foreign Weapons Sales, Overwhelming Other Arms Makers (by Noel Brinkerhoff and David Wallechinsky, AllGov )
Banks Say “Thanks for the Bailout,” Now We’ll Park our Profits in Overseas Tax Havens
By Steve Straehley | AllGov | March 16, 2015
Giant financial institutions that benefitted from federal bailouts during the depths of the recession have repaid the American people’s largesse by hiding profits overseas to avoid paying their fair share of taxes.
According to a report (pdf) commissioned by Senator Bernie Sanders (I-Vermont), four big banks—Citigroup, Goldman Sachs, Bank of America and JPMorgan Chase—which received massive amounts of money and loan guarantees to keep them afloat in the wake of the financial crisis, park large amounts of money in tax haven nations.
Citigroup got the most help of the four in the bailout, $2.5 trillion. That company has at least 427 offshore divisions where it squirrels away profits out of reach of the American people. Those funds, as of early 2014, totaled $43.8 billion, which would mean $11.7 billion in tax revenue for the United States if they were brought to this country. Citigroup CEO Michael Corbat was rewarded with $1.5 million in salary, $4.5 million in bonuses and $8 million in stock for his work in 2014.
Bank of America received a $1.3 trillion bailout from the American people. In 2014, it had $17 billion in profits stashed offshore, which would bring $4.3 billion in funding for education, infrastructure and other badly needed projects in the United States. Bank of America CEO Brian Moynihan made $1.5 million in salary, $13 million in bonuses and $11.5 million in stock in 2014.
JPMorgan Chase got a $416 billion bailout from American taxpayers. That bank has hidden $28.5 billion overseas which would bring in $6.4 billion to the U.S. Treasury. Chase CEO Jamie Dimon was paid $1.5 million in salary, $7.4 million in bonuses and $11.1 million in company stock in 2014.
Goldman Sachs was the recipient of $814 billion in virtually zero-interest loans, as well as $10 billion from the government. It’s holding $22.5 billion offshore that would bring $4.1 billion back to the American people. Goldman CEO Lloyd Blankfein made $2 million in salary, $7.33 million in bonuses and $7.33 million in stock in 2014.
Of course, banks aren’t the only companies taking advantage of tax havens. Apple, for instance, famously worked it out so two of its subsidiaries have no home country to which to pay taxes. But then Apple didn’t come hat-in-hand begging the American people not to let it go under.
To Learn More:
Legalized Tax Fraud: How Top U.S. Corporations Continue to Profit Through Offshore Tax Havens (by Senator Bernie Sanders, U.S. Senate) (pdf)
Offshore Shell Games (U.S. PIRG) (pdf)
The Bailouts 4 Years Later: Were They Worthwhile Investments? (by Matt Bewig, AllGov )








