Monday, January 23, 2017

Trump’s Assault on Globalization Will Hurt Russia Badly and Soon, Russian Analysts Say



Paul Goble

            Staunton, January 23 – President Donald Trump’s assault on globalism, something the Kremlin welcomes as a means of increasing disorder abroad, is going to hurt Russia and its population far harder than many now imagine and far more quickly now that Moscow’s reserves are running out, according to two Moscow analysts.

The first, Pavel Pryanikov, the founder of the Tolkovatel portal, says he can understand why many Americans oppose globalization because they have the domestic institutions and resources to cope with its demise but that he can’t understand Russian support for it because Russia will suffer as a result (kasparov.ru/material.php?id=5885B97B9A938).

The US has strong engineering schools and research centers, he points out, and it will not be difficult for America to rebuild on its own territory the factories now in China or South Korea that are producing for its market. There may be some rise in prices, but given the size and strength of the American economy, the US will take them in stride.

But the situation in Russia is very different: It lacks the domestic institutions and financial capabilities the Americans have, Pryanikov says; and that means that it will face serious increases in the prices of imported goods without the capacity to substitute domestic production of them. 

Consequently, he continues, if globalization is limited, this will mean for Russia “in the mid-term range only a growth of mass poverty and the spending of budgetary funds on import substitution projects that are unlikely to work as planned and that would cost more than Moscow can afford.

That conclusion is supported by the following fact: currently, Americans invest 70 billion US dollars in venture projects each year, while Russia makes only 400 to 500 million in this sector. That is the US invests 150 times more than Russia does, and that should tell Russians and perhaps even the Kremlin all they need to know about what the end of globalization would mean.

And in a commentary on the Republic.ru portal, Oleg Buklemishev the director for the Moscow State University Center for Economic Policy, explains why the impact of an end of globalization on Russia will not only be serious but that it will come far sooner than many now expect (republic.ru/posts/78699).

The economist points out that “Russia has exhausted its cushion of security” that its various reserve funds, which are now running out, had provided and that means it is “ever more dependent” on the price of oil and the attitudes of investors, factors over which the Kremlin has less control than it may think.

And that in turn means that any short-term shock to the Russian economy as a whole from changes in the international one is something that the Kremlin can no longer compensate for as it has in recent years by turning to reserves. These no longer exist, and so shocks from abroad will more quickly translate into shocks at home.

What Can Putin Really Offer Trump for a Deal?



Paul Goble

            Staunton, January 23 – The Russian and American media are full of stories in which various experts discuss what a deal between Vladimir Putin and Donald Trump might look like, with almost all the attention going to the concessions Trump should make to Putin and much less to the issue of what Putin in fact can offer in exchange.

            Thus, both Russian and US experts regularly talk about how the US could recognize Ukraine’s Crimea as legitimately part of Russia, end sanctions and recognize a Russian sphere of influence in the former Soviet space. But these same experts say much less about what Putin would offer in exchange (e.g., kp.ru/daily/26633.5/3652182/).

            On the one hand, many commentators Russian and American point to things that Russia is going to do anyway regardless of whether there is any grand deal or not, such as continue to use the fight against ISIS and Islamist extremism more generally to defend its own interests, as somehow requiring American concessions.

            Or on the other hand, they point to things that Putin probably can’t deliver on given his own domestic constituency in Russia’s force structures such as a serious reduction in the number of nuclear warheads, something that would reduce Russia’s status in the world significantly given that it is unable to compete in most other sectors.

            And so the question arises: why should someone who like President Trump has made “the art of the deal” and his ability to get the most out of any exchange for his own country ever agree to make concessions to Russia for things he will get even if he doesn’t make concessions or for promises that Putin will never make good on?

            That Russian experts are happy to push for a deal in which almost all the benefits flow in their direction is no surprise, and perhaps it is less surprising than it should be that some of their American counterparts are doing so out of a narrow professional interest in expanding contacts and exchanges regardless of the broader costs.

            But if Trump does this, if he violates the principles of his own approach to negotiations and his promise to always achieve more for the United States than it has to give to anyone else, that raises some even more disturbing questions about why he is doing this when he isn’t getting much in exchange besides the praise of those who don’t want to punish Putin for his crimes.

            It is possible that the new American president does not yet recognize this situation or that he has been persuaded that the US has to take the lead in making concessions, but it is difficult to imagine that Trump will continue down that path for long, given that the premise of his career is getting more than his opposite numbers and given Putin’s penchant for not keeping his word.

           

Sunday, January 22, 2017

‘Some Damn Thing in the Balkans’ Again – Putin Seeks to Exacerbate Conflicts There



Paul Goble

            Staunton, January 22 – At the end of the 19th century, Otto von Bismarck prophesized that “some damn thing in the Balkans” would be the trigger for a broader European war. The assassination of Austrian Archduke Franz Ferdinand I 1914 proved him right, with the great powers moving with varying degrees of enthusiasm toward the disaster of World War I.

            The risk that Bismarck could be proved right a second time now is frighteningly real, making two commentaries, one by Russian journalist Kseniya Kirillova and a second by Ukrainian analyst Vitaly Portnikov, on how Vladimir Putin is stirring the pot in that historically unstable region particularly noteworthy.

            Kirillova points out that Moscow is promoting Serbian revanchism, separatist attitudes, and traditional hostilities in the region to ensure that the situation in the Balkans remains at the boiling point, thus limiting the ability of the region’s countries to recover and to integrate into Europe (lb.ua/world/2017/01/19/356331_kremlevskaya_primanka_velikoy.html).

                She provides evidence of the close links between Bosnian Serb strongman Milorad Dodik and the Kremlin and points to other evidence showing that Moscow was very much involved with the recent unsuccessful coup d’etat in Montenegro and remains committed to the organization of a referendum there both to destabilize the area and to provide the patina of legitimacy to its own “referendum” in Crimea.

            But perhaps Moscow’s largest operation is its cooperation with pro-Russian radicals in Serbia itself who have “received the order from Moscow to ‘beat the enemy,’ who is understood to include the Albanians, NATO and the European Union,” according to Serbian political analyst Ventsislav Buyich.

            These Serbian radicals, Buyich says, “are absolutely certain that they have impunity and directly say that Russia ‘has reached agreement with Trump,’ and that the new US administration not in any circumstances will block their activities.”

            One of the reasons a new round of Serbian and Albanian conflict is of such potentially great use to Moscow, Kirillova points out, is that the Kremlin will present it as being simply “a Christian-Muslim conflict.”  Given Donald Trump’s statements, that description will help keep him on Moscow’s side.

            Moreover, the US-based Russian journalist says, “the Russian media have already begun actively promoting this legend,” and some Russian authors are “directly predicting a future war in the Balkans, accusing in advance Islamist terrorists, among whom, in the opinion of some experts, Russia has not a few of its own people.”

            Buyich adds that Russian Deputy Prime Miniser Dmitry Rogozin was even more clear as to what Moscow intends. In early 2016, he told Serbian radical Voislav Šešelj that he was giving him a box showing Crimea with Russia and hoped that Šešelj would soon return the favor by giving Rogozin one with a box showing Kosovo within Serbia.

            None of the countries around Serbia, not Montenegro, Macedonia or Kosovo, want to become part of ‘Greater Serbia,’” Kirillova concludes. They are all pro-European; “and that means Moscow’s plans can only be realized by a long a bloody war on the entire territory of the Western Balkans.”

            Portnikov for his part extends Kirillova’s analysis and says directly that “Russia wants a new war in the Balkans and is organizing this war” now by employing many of the tactics it used just before the Maidan in Ukraine to block its moves toward Europe and Moscow’s Anschluss of Crimea and invasion of the Donbass (7days.us/vitalij-portnikov-etot-poezd-v-ogne/).

            Russia, he continues, “will do everything possible to destabilize the relations of Serbia and Kosovo,” both to create conflicts and to block Serbia moving away from Russia toward Europe as Ukraine sought to do.  “And  no one will be surprised if as a result, new wars break out” – and one possibly more horrific and more likely to spread than the one in the 1990s.

            Everyone should keep in mind, Portnikov says, that “there is an essential difference between Milosevic’s wars and the conflicts of today.  Yeltsin’s Russia for all its obvious sympathy to Milosevic nonetheless expected prudence from the Serbian dictator and did not intend to fight NATO on his behalf.”

            “But Putin’s Russia not simply will help Serbia – it will be happy to transform this country into a new front of military operations and covets the outbreak of clashes with NATO in Serbia, Kosovo, Bosnia or wherever. And if NATO doesn’t get involved, that also will please the Kremlin” which will see it as yet another indication that it can advance elsewhere with impunity.