Monday, September 25, 2006

What is Going on in Russia ?

“And do you not dash forward too, Russia, like some eager, matchless troika? The road wreathes beneath you in a trail of smoke, the bridges rattle, everything falls back and is left behind. Struck by this miracle of God the onlooker stops short; is this not a bolt of lightning cast from the heavens? What does this terrifying motion mean? And what unearthly force lies hidden in these unearthly horses? What horses, what horses! Are there whirlwind caught in your manes? Is there some alert, sensitive ear straining through your every vein? You have heard the familiar song ring out above you, in one concerted surge you have set your bronze chests to the harness, and, your hooves barely touching the ground, you have turned into mere taut lines, flying through the air, and the entire troika hurtles forward, inspired by God!.. Russia, where are you flying? Give an answer!
No answer. With a wondrous peal the little bells ring out; torn into shreds, the air rumbles and turns into wind; everything on earth flies past, and with a wary look, other nations and states step aside and give way to the flying troika.”
N. V. Gogol, Mertvie Dushi vol. # 1.
“The mistake of the Slavophils lay in their thinking that Russia once had an individual cultured, obscured by various events and finally by the Petersburg epoch. Russia never had this culture and never could have had it….I even doubt whether the inner forces for their development would have been found without the Petrine epoch, without the period of European culture….Only the mighty thought of the West, with all of its long history is united, is able to fertilize the seeds slumbering in the patriarchal mode of life of the Slavs.”
A. I. Gertsen, Past and Thoughts, vol. # two.
“In his land Peter the Great found only a blank sheet of paper, and he wrote on it: Europe and the West; since then we belonged to Europe and to the West. One must not be mistaken about it: whatever the genius of this man was, his work was possible only within a nation whose precedents were not imperiously governing the development which it had to pursue, whose traditions did not have the faculty of creating a future for it, whose memories could be erased with impunity by an audacious legislator.”
P. Y. Chaadaev, ‘Apology of a Madman’.
“Russia, is the land of the Future, whose great growth and colossal demands dwell upon us, as an ever more terrible nightmare”.
7 July 1914, Theobold von Bethman-Hollweg.

What indeed is going on in Russia today?

Item: As per the Financial Times (21st of September edition), the Russian authorities have raised the possibility of canceling the permit for a huge (20 Billion Dollars) liquefied Natural Gas project (called Sakhalin-2), on the island of Sakhalin, in Russia’s Pacific coast, north of Japan. The project, which is jointly owned by Royal Dutch Shell, and two leading Japanese Zaibatsu, Mitsu & Mitsubishi, is intended to supply Japan with ten percent (10%) of all her energy needs. The Japanese foreign ministry officials say that any such cancellation would be a: ‘massive blow’ to Toyko’s plans to ‘secure a strategic energy partnership with Russia’. With the incoming Japanese Prime Minister Shinzo Abe, criticizing the rationale of the proposed cancellation.

Item: As per Moscow News, the Russian Ministry of Natural Resources has informed ExxonMobil, which is developing in conjunction with the Russian oil conglomerate Rosneft, a second series of oil and natural gas fields off the Island of Sakhalin (Sakhalin-1), that notwithstanding sinking about 4.5 billion dollars into the project, that expanding it to exploit recently found oil fields in the area was not allowable. And, that the recent finds would be ‘auctioned off’. And, while the project itself was not likely to be cancelled, Russian Deputy Economics Minister Kirill Androsov, advised the ExxonMobil et, al., to voluntarily scrap its existing low tax regime, for something which would yield the Russian treasury higher tax receipts.

Item: In a preview of a meeting on the 22nd in Paris, between French President Jacques Chirac, and Russian President Vladimir Putin, Le Figaro reports that notwithstanding attempts by the Quai D’Orsay to paint a rosy picture of the current state of Franco-Russian relations, officials at the French Foreign Ministry are in a ‘negative mood’, about the current and future state of relations between the two countries. As French diplomats put it: “despite Paris’ efforts to establish a close ‘strategic partnership’ with Moscow, France does not escape the common lot when it comes to the hard core of Russian policy – oil”. With the possibility that the French, oil combine, Total might have its license to drill for oil, withdrawn by the Russian authorities. As quoted by Le Figaro, the Quai D’Orsay now feels that it has ‘indulged in wishful thinking with regard to Russia’. As one French diplomat put it succinctly:
“ ‘Russia is regaining its health and conducting itself as a power which is a good thing….But this partner is increasingly inclined to reject compromise formulas. Cooperation is grinding to a halt’ ”.

Item: In a tripartite meeting on the 23rd near Paris between Chirac, Putin and German Chancellor Angela Merkel, Putin pledged that Russia was a reliable energy partner for the EU. As per the New York Times, Putin also dismissed concerns that Russia’s recent purchase of a five percent stake in the pan-European controlled, EADS (the parent company of Airbus), was not “evidence of aggressive behavior on the part of the Russian side”.

What indeed is ‘going on’ in Russia? Well to be honest it is a very mixed picture. There are various currents in Russian policy at present operating. Some of those currents, are while not necessarily ‘pretty’, do bear some resemblance to rationality. Certainly, I would, unlike some of the more Liberal & Neo-conservative voices not regard every time that Russia refuses to go along with American wishes (viz policy vis`a-vis Persia, Hamas or even arms sales to Venezuela) as evidence that Russia was either inevitably hostile to either American, much less ‘Western’ interests or concerns. That being said however, there does appear to be more and more cases where Russian policy, particularly in the field of oil resources and international co-operation, appear to be less than rational. Rational not only for the Western concerns involved, but even for Russia itself. In the area of natural resource development, while Russia is a honeycomb of oil, natural gas, et cetera, it currently does not have either the technology (at least at the highest level) or the expertise to extract said resources. In addition, the hard evidence of the past five years is that Russian oil and natural gas companies (the state-owned Gazprom combine in particular) are: a) not as generous in funding projects like Sakhalin which need huge amounts of cash to get started, preferring to rely upon existing fields of current production; b) are notoriously inefficient, both in terms of waste at the production head, as well as transporting it.

Russia, as German Imperial Kanzler, Bethman-Hollweg noted above, has been a country of vast potential for quite awhile now. Indeed, going back perhaps almost two hundred years now. Unfortunately, it has until this time, remained just that: potential. Due of course for the most part, to the criminal insanity of Bolshevism (see Richard Pipe’s two volumes on the Russian Revolution for the best understanding of this). Which massively distorted and disrupted Russia’s natural, organic development, economically, politically and socially. The best example of which is that in 1913, the Russian Empire had a per capita incomes thirty-five percent (35%) of the West European average, with a significantly higher figure than for say Korea, Hong Kong, Greece, or Cyprus. Now of course all these nations have per capita income which are anywhere from three to five times higher than Russia, and the EU countries having a per capita income of almost nine times as high. Suffice it to say, whatever the spiritual correctness of Russkii Sorbornost, as a method of governance it leaves a great deal to be desired. The very last thing that Russia needs now, is for another historical chapter, of ‘taking leave of her senses’. The idiocy of Kvass Patriotism, is to my mind self-evident, and one does not need to emphasize the same. What Russia in particular needs at this time is a policy of intelligent patriotism, which sees the need, nay the necessity of openness to the outside, in particular European world, in the mode of say Munnich, Osterman, Nesselrode, Kankrin, Gorchakov, Bunge, Giers, Witte, et. al.

What Russia needs, is the same thing that its last great statesman P. A. Stolypin, said it needed in 1910: twenty years of peaceful development. A development one might add, which at the time was fully funded by West European capital and to a degree, personnel. Instead of attempting to either frighten off, or hamstring international investors in Russia’s energy sector, the Kremlin should be welcoming them with open arms. It is only in conjunction with the outside world, and in particular Europe, that Russia can and will find its full potential. Eurasianist tendencies as elaborated by the late historian and thinker L. N. Gumilev, and his followers, are the very last thing that Russia needs at this stage in her historical development (on ‘Eurasianist’ tendencies in Russia at the moment, see articles in: any such path would be by definition a historical cul de sac. The end result of which would be that Russia would in fifty years time, could possibly revert to another ‘Tartar Yoke’, id est, Chinese domination, both economically, demographically as well as militarily. What Russia needs is a wise policy of reasonable reliance on Western, especially West European partners. Of course this policy must be reciprocal and have benefits for both sides. But, as the article cited above in Le Figaro points out, elements in the French establishment, from Chirac on down would love to enlist Moscow as part and parcel of a countervailing European force vis-`a-vis the USA. In essence, in permanence, the anti-Iraq coalition of 2003: France, Germany and Russia. Of course with the replacement of Gerhard Schroder by Angela Merkel, and the retirement of Chirac next year, such an alignment is far from a surety. However, in conjunction the Russo-Chinese dominated, Shanghai Cooperation Organization (SCO), as well as its seat on the UN Security Council, and membership of the Quartet, Russia certainly possesses enough levers to bring to bear its presence on the world stage, vis`a-vis the USA (on the idea that the SCO is a ‘counterbalance to America’s perceived dominance’, see: Shaun Walker’s 21 September article in A similar rational can be seen in Russia’s reemergence in the Putin period, as a major player in the Near East. Admittedly not on the same scale as say in from the mid-1950’s to the end of Sovietskaya Vlast, but enough, to (to quote the great French writer Andre Malraux), put her ‘scar on the map’(for this see, Vladimir Frolov’s 14 September article in

What however could potentially ruin this arrangement, is if Russia, through the mysterious way in which she fashions her internal arrangements, especially on energy policy in particular, and foreign investment in general, completely alienates Western and especially West European major investors. The maneuvers around both Sakhalin projects are hardly the best advertisement for Russia’s reliability as an energy partner for both Europe and Japan. Particularly since the Byzantine nature of the decision-making in the Kremlin on energy issues, leave a lot to be desired. No doubt with a mind to reassure his Western European interlocutors in particular, Putin, has, emphasized the ‘reliability’ of Russia as an energy supplier and has signed on Friday in Paris, two projected commercial projects with French concerns, worth upwards of 10 Billion dollars. Additionally, Putin has made verbal attempts to co-operate with the USA, on the Persian issue, even floating the idea on the 16th of this month, that Russia would, if need be, agree to vote for sanctions at the UN Security Council. And, while the Bush regime’s attempts at promoting (mostly rhetorically these days), a ‘democratic transformation’, in Russia’s ‘near abroad’, has been viewed by the Moscow in entirely unfriendly terms, unless the USA, were to go beyond rhetoric, there seems to be an intelligent willingness, on Putin’s part, to ignore mere words, and focus the reality of American policy. As Russian State Duma, Deputy Committee Chairman, Sergei Shishkarev has commented:
“Russia will continue to resist U.S. attempts to govern the world through democracy promotion and economic sanctions. But that does not mean that Russia will mount an across-the-board challenge to U.S. interests. Instead it will apply a policy of selective containment and selective engagement on differing international issues”
(8th September 2006 in

Of course, if the more antagonistic elements in the American administration, were to have their way, and say, attempt to back Georgia, in its (so far diplomatic) conflict with Russia, over the breakaway Georgian province of South Ossetia, than all bets would indeed be off. Currently Russian policy is thoroughly anti-Georgian, and any attempt by Washington to back Georgia, even rhetorically, would be seen in Russia as an attempt to interfere in a vital Russian interest (see Sergei Blagov’s 18 September article in . To expect any Russian co-operation in such an atmosphere, on almost any issue, least of all vis`-a-vis Persia, would be completely illusory (see George Perkovich’s comments on the 28th of August, in Currently, Bush and Rice, appear to recognize the value of co-operating with Putin, notwithstanding the occasional bumps in the road, so far. The fact that they gave no thought to boycotting the G-8 Summit in Saint Petersburg, is on indication of that. One only hopes that they will see clear to not lose sight of that fact, both for securing American interests, and for Russia’s own future development.


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