- (december 2019)
Man of the Decade: Vladimir Putin.
First you have to put things in perspective. Russia looks big on the map,
but its population (145 million) is smaller than Bangladesh's population,
and shrinking, and its economy ($1.6 trillion) is the same size as South
Korea's economy, smaller than Canada's. It is about one tenth of China's,
and the USA, with a population that is only double Russia's, has an economy
that is 13 times bigger.
Russia's economy heavily depends on exports of natural resources, notably
natural gas and oil, and therefore its wealth depends
on commodity prices; just like most third-world countries.
Nonetheless, Russia has been winning on all fronts and has become again one
of the most powerful countries in the world. Hats off to its leader, Vladimir
Putin, who has consistently outsmarted the West.
Putin realized that Russia's only real asset after the collapse of the Soviet
Union was its military arsenal. Russia was left with thousands of nuclear
weapons (a very good argument to deter military intervention by any world
power) and with a sophisticated military industry.
Putin understood that the future of the military industry is also
software, not only hardware, and nurtured the rise of one of the world's
most sophisticated cyberwarfare units.
That's what he has used to revitalize Russia on the world stage:
both hardware and software.
Russia has used force in Ukraine, Syria and Libya. Russia seized a piece of
Ukraine (Crimea) and occupies a portion of eastern Ukraine. Russia has bombed
Syrian rebels and ISIS to protect its puppet Assad in Syria, who is now again
comfortably in power. Russia has supported warlord Khalifa Hifter in Libya,
and he is getting closer to overthrow the Western-recognised government of national accord. If that happens, for the first time Russia will have military
bases in the middle of the Mediterranean, right across from Italy.
At the same time,
Russia has more than one foothold in Latin America: not only Cuba, a traditional
Soviet ally, but now also Venezuela, whose dictator Maduro enjoys
Putin's support (Trump stopped speaking of overthrowing
Maduro after Putin spoke out in Maduro's favor).
There is another way that Russia has used its military hardware to gain
influence in the Middle East: by selling it. Russia has sold a missile system
to Turkey, a country which is a member of NATO, has sold fighter jets to Egypt
(whose leader Al-Sisi supports the same warlord in Libya), and has signed
lucrative contracts with Saudi Arabia, another close US ally.
Russia is India's biggest arms supplier.
Meanwhile, Russia's cyberwarfare has sowed discord in both Europe
and the USA.
Russia was extremely successful in the USA, installing a de-facto puppet in
the 2016 election (Donald Trump). It was also somewhat successful in promoting
Brexit in Britain. The Mueller report in the USA simply showed Russia's
intention to help Donald Trump, without proving if Russia's help turned out to
be crucial (would Trump have won without the fake-news operations conducted
by Russian cyberwarriors?), but the report by the British
Intelligence and Security Committee should show that Russia's help was not
only an attempt, it actually determined the outcome of the Brexit referendum
(Britain's prime minister, who indirectly owes his political fortune to that
Russian campaign, has refused to publish the report, but parts were leaked).
Maybe the USA and Europe were doomed anyway by their internal bickering.
After all, Obama's eight years were marked by gridlock in Washington
on almost all important issues: it didn't take Russia to sabotage the USA.
After all, the European Union was fighting a bad economy and rising nationalist
parties even before the Brexit referendum: it didn't take Russia to sabotage
the European Union.
Whether Putin's cyberwarfare was essential or not, the result has been a general
decline of the West's influence on the world. Trump, in particular, has done
more to weaken the USA on the world stage than any enemy of the USA ever did.
We are now witnessing something quite extraordinary but perfectly rational:
the parties and the individuals that benefited from Russian help are reluctant
to blame, punish or even restrain Russia. The Republican Party of the USA
is increasingly defending Russia. During the impeachment proceedings against
Donald Trump, a Republican senator was spinning Russian propaganda on the
Senate floor, something that had never happened before. The Senate's leader,
Mitch McConnell, has been nicknamed "Moscow Mitch" for the way he protects
Russia from sanctions.
The Republican Party used to be the one obsessed with fighting Russia,
but the effect of Putin's pro-Trump cyber-campaign has been to turn this
party into a pro-Russia party: if Russia can help the party remain in power,
why not take Russia's help? The Republican Party desperately needs to find
ways to remain in power despite winning increasingly smaller minorities of
votes in national elections.
Just like Osama bin Laden didn't dream of taking down two skyscrapers when
he launched his 2001 attacks, so Putin may be getting more than he was
hoping for: not just a puppet US president working for Russia but an entire US party working for Russia.
The effect of Putin's success against the USA and Britain has been to
influence many Western politicians, from Hungary's Orban to Italy's Salvini
and France's LePen. They seem to be mesmerized by
Putin's blend of nationalism, pragmatism, and fascism.
This further reduces the determination of European countries to oppose Putin's
actions. The one politician who was not easily intimidated by Putin was
his nemesis Angela Merkel, but Putin can find comfort in her
deteriorating health. Once she's gone, there will be no charismatic
European leader standing in Russia's way.
Going forward, there is no question that Putin has outsmarted the USA,
and the West in general,
but it could be that, at the same time, China has been consistently
outsmarting Russia, and the next decade will cause a decline in Russia's
importance simply because Russia will wake up to the fact that China
is better positioned to project power outside its borders, even in areas
traditionally dominated by Russia like Central Asia, northern Africa and the
Russia can only offer military power and military tools.
These are certainly vital for any authoritarian regime (to remain in power)
and for any country surrounded by unfriendly neighbors.
But China can offer a combined economic and political model that has been
extremely successful in creating the second largest economy and, quite
simply, a lot of wealth for the ruling elite.
It is China, not the USA, that may end up displacing Russia
and causing its demise.
TM, ®, Copyright © 2019 Piero Scaruffi All rights reserved.
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- (february 2019)
The Difference Between Xi and Putin.
As the leaders of the two biggest rivals to the West,
Xi and Putin are frequently compared,
but the comparison makes no sense.
First of all, Putin created his political party, whereas Xi was created
by his political party. Putin is accountable to nobody in his party,
whose major representatives are mostly picked by Putin himself,
whereas Xi is accountable to his party, and that party is mostly a meritocracy.
I am not convinced that Xi is as powerful as Putin is in Russia.
There are also fundamental differences in the two parties. I am no communist,
but China's Communist Party is a meritocracy whereas Putin's party is
reminiscent of the mafia. If Putin has to fear anyone in Russia, it's the
plutocrats. On the other hand, the Chinese plutocrats have to fear the party.
Secondly, Putin won democratic elections, no matter what you think of them:
people were allowed to vote, and voted him. Xi was not voted in power by
the people, nor did they expect to. The relationship between power and
people is completely different in China since ancient times.
China's communism is basically a secular version of confucianism
(devoid of religious overtones) adapted to modern economic theory.
Putin is a descendant of right-wing populists like Mussolini and Hitler.
Thirdly, Putin oversaw the massacre of about 200,000 rebellious Muslims
(the Chechens) whereas Xi has "only" sent his rebellious Muslims (the Uygurs)
to "reeducation camps" where, as far as we know, prisoners are not being
Fourth, Putin's opponents have been murdered both at home and abroad, whereas
Xi's opponents at worst get jailed (and often it's a house arrest, not a real
prison cells). Not a single Chinese journalist, dissident, opponent has been
killed since Xi was appointed president.
In China you may lose your career if you criticize the Communist Party.
Putin, instead, physically eliminates his opponents.
Fifth, Putin has created a Russia that is
economically and technologically a backward country, but he inherited a
Russia that was on the verge of collapse, whereas Xi inherited a stable and
economic and technological state, and, so far, has not been able to improved it.
China's economic model is inspired by the West, from Germany's Industry 4.0
to Silicon Valley's "dotcom" startups via Taiwan's "learn by doing" strategy.
Putin's economic model is limited to selling natural resources and weapons.
Xi's challenge is to reinvent China's economy now that has achieved industrialization.
China doesn't have enough natural resources and it has to manufacture goods
and services in order to feed its 1.4 billion people.
Putin doesn't care about industrialization because it can feed his 150
million people with oil, natural gas and high-end weapons
(Russia's commercial industry was destroyed when the Soviet Union collapsed).
Both men have displayed "imperial" ambitions, i.e. expanding the influence of their
country outside the borders, but Putin's imperialism is purely political:
Russia does not need natural resources (it is the world's biggest exporter of
natural resources); whereas China's "imperialism" is economic in nature
(it is becoming the world's biggest importer of natural resources).
China's "empire" is a natural extension of its domestic infrastructure.
This is reflected in their cyber-hacking strategies: China's hacking is
mostly about industrial espionage, whereas Russia's hacking
tends to be political in nature (like when it attacked the Democratic Party
to help its favorite Trump in the 2016 elections).
See Does China steal?.
Both are wary of Western encirclement. Russia has been attacked twice from
the West (Napoleon and Hitler) and views NATO as a third attempt.
China is surrounded by US bases and warships (South Korea, Japan, Taiwan,
Singapore, Australia, Afghanistan, and so on), and its natural rival for
Asian domination, India, is a multi-party democracy like the USA that speaks
the same English language and that has signed a nuclear treaty with the USA.
Both are wary of US interference. The USA has accused Russia of interfering
in the 2016 elections that ended up with a president aligned with Putin,
but there is little question that the USA has interfered in dozens of the
elections of many countries and even overthrown governments (sometimes through
military invasions). There is, in particular, little question that US
presidents have regularly supported protest movements against mainland China
(notably in Tibet) and against Putin in person (the origin of Putin's obsession
with Hillay Clinton).
Both Xi and Putin have launched
initiatives that undermine the USA's role on the
world stage, but, again, Xi's actions tend to be economic in nature (the One Belt One Road initiative and various economic treaties), whereas Putin's actions
tend to be military in nature (like in Syria and Ukraine).
We have not heard of a single case where China imposed a trade deal to a
nation using its navy the way the Europeans did at the beginning of their
imperial expansion. China befriends dictators on purely economic
terms (Venezuela is a good example), regardless of ideology, the same way
it befriends democracies (several in South America).
Russia supports only dictators on purely ideological terms
(only anti-Western dictators).
China trades with Iran because it needs oil, Russia doesn't need oil but
it trades with Iran simply because Iran is an enemy of the USA.
In many cases China buys (natural resources) whereas Russia sells (weapons).
The biggest difference of all, of course, is that Putin has 3,000 nuclear
weapons, whereas Xi has only about 200, despite the fact that China's
economy is almost ten times bigger than Russia's (one of the many
aberrations of the 21st century).
So far China has only militarized a few islands that were never used,
whereas Russia has invaded countries (Ukraine and Syria).
Both Putin and China are honestly annoyed by the USA's
wars of conquest, that were wildly mismanaged and sometimes ill-intentioned:
the wars in Afghanistan and Iraq (one justified, the other one not) left
behind terrorism and chaos; the Arab Spring left behind terrorism and chaos;
the interventions in Serbia and Sudan to create new states (Kosovo and South
Sudan) left behind permanent conflicts.
After the USA creates a problem, the international community has to rush to
fix it. Russia sees itself as the one that solved a problem in Syria that
was created by the USA and that the USA couldn't solve.
China, mostly, views the USA as an unreliable partner and an unreliable
world leader because every four or eight years the US president changes and so
does the country's strategy.
It is therefore not surprising that Xi (a communist son of a communist) and
Putin (the inspiration for the neofascist movements around the world)
tend to ally against the USA at the United Nations. Whenever the USA
begins lecturing the world about a crisis somewhere, they are justified in
fearing that the USA will create yet another problem and then walk away from it.
The thing that Xi and Putin have in common (as did Xi's predecessors) is that
they are very rational. One wishes the same could be said of Western
politicians such as Donald Trump and the "Brexit" clowns.
- (march 2019)
Why the World Listens to Russia.
A Russian official (Andranik Migranyan of the Moscow State Institute of International Relations) is reported as having said to a Western journalist: "You toppled the most successful government in North Africa". That was a reference to Qaddafi's regime. For the West, Qaddafi was a brutal madman who ruled Lybia for more than 40 years. For the much of the world, however, Qaddafi was the man who turned Lybia into the richest country in north Africa (way ahead of Western allies such as Egypt and Morocco) and one of the richest in the whole Islamic world. It was also amazingly stable and reliable by the standards of the third world. Now it is no man's land.
Most of the world views that case as the norm of US interventions.
Wherever the US intervenes with the pretext of "liberating" the nation, chaos ensues.
Then the USA withdraws, leaving a helpless population to suffer from terrorism, warlords, drug gangs etc. And then the USA returns to drop bombs from drones.
The USA lost in Iraq, Afghanistan and now Syria. Russia won in Syria.
The USA caused the mess in Iraq, Lybia, South Sudan, Kosovo, and countless other places.
Russia is restoring peace in Syria.
Given the precedents, the world is wary when the USA verbally attacks a regime,
such as in Iran and Venezuela, and the same world finds comfort in Russia's
immediate defense of such regimes. When it looked like the USA was about to
invade Venezuela, the world feared for another Lybia, another country torn
in a bloody civil war for years to come. When Russia acted to prevent such
an invasion, much of world breathed a sign of relief (probably including many
US allies, who have little appetite for supporting yet another
US-led invasion, especially now that the USA is led by the most incompetent
and corrupt statesman in the world).
Putin is also admired at a personal level. He obviously enjoys strong support
Most Russians believe that Putin truly believes in "making Russia great again".
Putin is honestly pursuing Russia's (short-term) interests on the world stage,
whereas US politicians are pursuing their own personal interests or Israel's interests (See The USA is a banana republic).
Contrary to Western stereotypes, the polls in Russia are fairly accurate.
Putin pays close attention to his approval ratings to see what works and what doesn't.
According to Alexander Oslon, who runs the Public Opinion Foundation,
Putin and his advisers are addicted to polls.
Russia is one of the oldest societies in the world because of it has one of
the lowest life expectancy rates in the world. Therefore the opinion of
old voters matters a lot. Old people remember that Russia collapsed twice
into chaos: in 1917 (when communism seized power) and in 1991 (when communism
Old Russians want a stable government before anything else.
Anywhere in the world, old voters are more motivated than young people to vote,
but it is in Russia that this natural tendency reaches a peak and becomes
an aberration: pensioners are just about the most powerful voting group of
the nation. There are 36 million pensioners in Russia compared with a population
of 83 million workers. Men retire at 60 and women at 55, which in most countries
are still considered productive years (but keep in mind that in Russia
the life expectancy for men is 66 and for women 76).
The only significant threat to Putin's power since the protests
of 2011 (which Putin blames on Hillary Clinton)
came in 2018 when Russia announced pension reforms.
Putin's approval rating plummeted from 80% to under 50%, and a few weeks later
Putin's United Russia party lost at the polls in at least four
regions (two went to the communists and two to the nationalists).
Putin himself is not young: he is 67 and is surrounded by people of his generation.
Russia's interference in US elections is doubted by the radical right-wing media of the USA, but it is widely believed in Russia, where Putin has always done this kind of things. More importantly, it is viewed as a victory by Putin: the Russians admire him for inflicting this humiliation to the much vaunted US democracy. Russia outsmarted the USA. When Trump's victory was announced, the Russian parliament gave Putin a standing ovation. When news that Mueller had found "no collusion" transpired, Putin supporters marched in the streets of Moscow celebrating another Putin triumph. Think of it: they were celebrating that the Mueller report said "Putin didn't succeed", which is an odd thing for Putin supporters to celebrate if you take the report's conclusions literally; except that Putin's supporter interpreted as "Putin certainly colluded with Trump and now even managed to get away with the crime - he fooled the USA twice".
Guess what? The rest of the world thinks so too
It's not only ordinary people
around the world
who think that Trump is "compromised" with Russia and therefore won't stand up
to Russia; it is also the very leaders of the nations already or potentially
involved in disputes with Russia.
The fact that Trump colluded with Russia is... a fact, whatever you definition
of "collusion" is.
Whether he did it intentionally or because he is a low-IQ bumbling fool
the consequence is the same: the USA cannot be trusted in matters that relate
Both allies and rivals assume that Putin now has the ability, through Trump to
undermine any US policy against Russia.
Putin's successes around the world have made him a much more credible voice.
In fact, he may now be more respected outside Russia than inside Russia.
One can view this phase of Putin's career as his "international" phase,
following a phase in which he was busy stabilizing Russia (and getting
rid of opponents).
TM, ®, Copyright © 2019 Piero Scaruffi All rights reserved.
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