January 12, 2014

Stanley Fischer's role in piratizing Russia's wealth

In the 1990s, a small coterie of economists at Harvard and MIT, such as Jeffrey Sachs, Larry Summers, Andrei Shleifer, Jonathan Hay, and Stanley Fischer, played a crucial role in recent history by advising the government of Russia to rapidly privatize its economy. Much of the wealth of Russia wound up being stolen by a tiny number of oligarchs.

The President has nominated Dr. Fischer, who recently resigned after eight years as head of the Israeli government's central bank, to be vice chairman of America's central bank, the Federal Reserve. This might be a good time to reflect upon the successes and failures of Dr. Fischer's recommendations in contributing to the Rape of Russia.

Fischer was not the public face of the experts from Cambridge, but he appears to have been a respected insider, as he remains today. His nomination to the Fed has been greeted with outpourings of praise from global financial insiders and very little skepticism from the less privileged.

As far as I know, nobody has ever accused Fischer of attempting to unethically profit off of the disaster he helped create in Russia, as the Federal government fined Shleifer and Harvard for doing.

Still, Fischer was there at the creation. He had numerous chances to speak out publicly about what was going horribly wrong in a Russia that looked to him and his friends for advice.

Fischer's role in Russia in the 1990s can be seen from contemporary documents:

From the Christian Science Monitor, June 19, 1991:
Yeltsin Arrives In US to Discuss Trade, Politics
US-SOVIET RELATIONS

EVEN before Boris Yeltsin touched down on United States soil June 18, the newly elected president of the Russian Republic had scored public relations victories on two fronts. ... 
Yeltsin arrives in the US at the height of debate over what the West should do, if anything, to prevent a possible collapse of the Soviet economy and promote genuine, lasting market reforms. 
The enthusiastic reception of Yeltsin's visit could bolster Gorbachev's bid for Western economic aid, because as a noncommunist and as the first democratically elected leader of Russia, Yeltsin could be instrumental in helping Gorbachev implement radical market reforms. 
Over the weekend the much-discussed "grand bargain" proposal linking Western aid to Soviet reform, drawn up by US and Soviet academics at Harvard University, was delivered to the White House and the Kremlin. 
... At the unveiling June 14 the plan's architects did not project an exact cost of the proposal, which would provide credits and cash to ease the hardships that would result from the shift to a market system and a convertible currency. But Stanley Fischer, an economist at the Massachusetts Institute of Technology (MIT) who took part in the project, says for the first few years the figures would be "large between $20 billion and $25 billion a year, a cost to be borne by the Western industrialized nations. 
The first step, says Dr. Fischer, is for the Soviet Union to gain associate status at the International Monetary Fund and the World Bank, which will then oversee the country's economic restructuring. The big change, he continues, would start in 1992, when price controls would be lifted, trade restrictions would be eased, and the money supply and budget deficit put under control. 
When asked if Yeltsin will support the plan, Mr. Yugin said, "I think we will." ...

Gorbachev aide Yevgeny Primakov and First Deputy Prime Minister Vladimir Shcherbakov, have distanced the Kremlin from Grigory Yavlinsky, the lead Soviet economist on the Harvard plan. 
Mr. Yavlinsky's murky status is "convenient for everybody involved," says Fischer of MIT. If the plan is deemed workable, everyone can embrace Yavlinsky's work, Fischer says. If not, the Kremlin will not be seen as having failed yet again to follow through on an economic reform plan.

This seems to be a recurrent theme: Dr. Fischer was publicly proud of not just his economic theory bona fides but also of his practical political expertise in the murky terrain of post-Soviet Russia.

From the Christian Science Monitor, June 5, 1992:
Improving the World With Academic Advice

RUSSIA'S First Deputy Prime Minister Yegor Gaidar knows quite a bit about the problems Latin American nations have had with populism and hyperinflation. That's because Rudiger Dornbusch, a Massachusetts Institute of Technology (MIT) economist [and co-author with Stanley Fischer of the textbook Macroeconomics], "Fed-Exed" the Russian economic reformer a bundle of 15 or so books on that topic, figuring it would help him deal with Russia's similar difficulties.

"He actually studied them," says Dr. Dornbusch, one of several United States professors giving economic advice to the Russians. 
Another MIT economist, Stanley Fischer, got back last Saturday from Moscow after spending several days working with the Russian Central Bank. 
These two aren't alone. A sizable group of well-known academics from MIT and Harvard University are acting as consultants, paid or unpaid, to foreign governments. Their advice is actually having some impact on world affairs. 
... "We do it because it is extremely interesting," Professor Fischer says. While in Moscow, for instance, he learned enough about the political situation to anticipate the resignation of the Central Bank's chairman, Georgi Matyukhin. He can even speculate on successors. Fischer also gives advice to Israel on visits to that country. 

Was Fischer simply embarrassingly naive about what these post-Soviet apparatchiks were up to? Or did he have some clue about the crimes being committed by those claiming to follow his advice?

Those seem like they would be interesting questions to ask him, so I'm betting no Congressman will ask them.

From the Christian Science Monitor, December 11, 1992:
MIT's Mr. Fischer hopes Gaidar [the acting prime minister] will push ahead even faster with privatization of industry, getting the budget in shape, and other reforms. But the Russian government, he says, doesn't have "a coherent policy" for dealing with the large enterprises within the "military-industrial complex." 

From the 2003 book The Piratization of Russia by economist Marshall I. Goldman:
Gaidar [acting Prime Minister of Russia in 1992] was a strong proponent of a market system. He was an even stronger advocate of privatization and, for that matter, a whole package of near-simultaneous reforms that came to be known as “shock therapy,” and today is called the “Washington Consensus.” Gaidar had come to this concept as a result of his studies as well as from a series of discussions with economists from both Eastern Europe and the United States. Among those interacting with Gaidar at one stage or another were Jeffrey Sachs, Andrei Shleifer, Jonathan Hay, all of Harvard University, Anders Aslund of Sweden, and, later, the Carnegie Endowment and Richard Layard of the London School of Economics. IMF officials and Stanley Fischer in particular had long advocated something similar, that is, simultaneous and far-reaching economic liberalization (that is, micro policy reforms combined with determined macro restrictions to curb inflation).

From Wikipedia' article on Yegor Gaidar:
Gaidar was often criticized for imposing ruthless reforms in 1992 with little care for their social impact. Many of Gaidar's economic reforms led to serious deterioration in living standards. Millions of Russians were thrown into poverty due to their savings being devalued by massive hyperinflation. Moreover, the privatization and break-up of state assets left over from the Soviet Union, which he played a big part in, led to much of the country's wealth being handed to a small group of powerful business executives, later known as the Russian oligarchs, for much less than what they were worth. As society grew to despise these figures and resent the economic and social turmoil caused by the reforms, Gaidar was often held by Russians as one of the men most responsible.[9][10]

So, was Fischer simply suffering from faulty Gai-dar? Or was his Gaidar working accurately, and the catastrophes suffered by the Russian people struck him as just a case of being unable to make an omelet without cracking some eggs? Or was the looting of Russia more a feature than a bug?

In 2011, after all these years, Fischer delivered the Gaidar Memorial Lecture, suggesting he doesn't feel betrayed by his Gaidar.

From the appendix of a 1993 Brookings Institution book Privatizing Russia by Shleifer, Maxim Boycko, and Robert W. Vishny, here are Fischer's comments on the success of the recommendations made by himself and his colleagues:
Comments and Discussion  
Stanley Fischer: Privatization stands out as the most successful element in the Russian reform program. Indeed, Russian privatization is even outpacing privatization in other countries in the former Soviet Union and in eastern Europe.

Conversely, the slower pace of privatization in countries like Poland shows that the Rape of Russia didn't have to happen, or least not as disastrously.
This interesting paper, written by some of the important thinkers behind the program, helps explain why.  
... Apparently, the authors, like other observers, do not yet see much in the way of restructuring taking place.  
Does that mean that the authors should have urged delaying privatization until they had invented a scheme that would guarantee rapid restructuring? The answer is no, because it was crucial to move these firms out of direct state control. Should the lack of restructuring cause a slowdown of the privatization process? Again, the answer is no, for the same reason.
... Was there an alternative that would have produced more rapid restructuring? The answer is yes, but that decision belonged not to the privatizers but to Boris Yeltsin. He could have pushed for a more aggressive reform program, but chose instead to confront his congressional rivals more slowly.  
... The paper gives the impression that all politicians are bad. But at some point it becomes clear that Anatoly Chubais, Boris Yeltsin, and the reformers are good politicians. So this is really a paper about the good guys versus the bad guys, and we do not know what drives the good guys, and what differentiates them, except that we are on their side and they on ours.
... Beyond the privatization of industrial firms lies the challenge of privatizing agriculture and housing. Given the speed at which the current privatization is proceeding, the authors will soon be able to turn their talents to those problems. 

In 1994, Fischer became America's man at the International Monetary Fund, its number two official. (By custom, Europe gets the top IMF guy, while America gets the top World Bank official.) On January 9, 1998, Fischer delivered this less than prescient speech:
The Russian Economy at the Start of 1998 
Stanley Fischer 
January 9, 1998 
Six years after the start of the Russian economic reform process, much has been achieved and the continued progress of the economy towards economic normalization is not in doubt. ... 
Nineteen ninety seven was a year of achievement for the Russian economy. 
For the first time since 1992, the economy grew, albeit barely. The current account of the balance of payments was in surplus. The Central Bank of Russia once again proved its professionalism, as inflation continued to decline, and as late in the year it successfully fought off contagion effects from East Asia and maintained the currency band. At the start of 1998, with a broadened currency band, and a non-confiscatory currency reform under way, confidence in the maintenance of monetary stability should continue to strengthen. 
In 1997, as in 1996, central government revenue shortfalls constituted the major failure of macroeconomic policy. At the start of 1998, fiscal reform and performance remain both the crucial element and the crucial question at the center of Russia’s economic program with the IMF. The reform of the tax code and increased revenue collection are on one side of the equation; on the other side, increasing the efficiency of government spending and strengthening expenditure management deserve no less attention. Equally important for future growth is continued progress with structural reforms, whose implementation had for some years lagged until recently -- but it must be noted and emphasized that the structural components of the Russian reform program moved ahead as agreed with the IMF (indeed even a little faster) during 1997. 
I am also happy to report that the IMF Executive Board yesterday completed the delayed sixth quarterly review of the Extended Fund Facility with Russia, and -- laying particular stress on the fiscal action plan agreed between the Russian authorities and the Fund staff in December -- agreed to disburse a $700 million tranche, thus bringing the program back on track. 
I. Achievements of the past six years. 
Six years ago, Russia set out on the road to a market economy by liberalizing prices and beginning to dismantle the instruments of central planning. In these six years, Russia has made remarkable progress in important areas. ... 
Market development: A large and increasing share of Russian economic activity is channeled through market mechanisms. In its latest Transition Report, the EBRD estimates that 70 percent of GDP is accounted for by the private sector.4 This vibrant private sector, for all its imperfections, has become the major agent of economic growth and change. 
... The experience of other transition economies, as analyzed in a number of studies, suggests that Russia will move onto a sustained growth path as inflation falls and fiscal adjustment and structural reforms proceed. In many respects, Russia has an exceptionally favorable basis to achieve that end: important natural resources, including minerals and energy; a highly educated labor force, which is still employed to a large extent in the less productive state sector; and a potentially large domestic market with pent-up demand for consumer goods and social infrastructure. However, a major constraint to Russia attaining satisfactory rates of growth is that the process of structural reform has not gone far enough. 
Indeed, empirical analysis has shown that the main reason why growth in Russia and other CIS countries lags behind the record of the Eastern European and Baltic countries is the slower pace of market-oriented structural reform.6 While Russia has made substantial strides in some areas of structural reform (notably small scale privatization, the liberalization of the trade and foreign exchange system and, to a lesser extent, natural monopoly regulation), there are important areas where much more progress is needed. 
... With macroeconomic stability close to being attained, the focus now must shift to structural reform, particularly private sector development. A fast pace of economic recovery will demand substantial increases in efficiency and capital accumulation, and these in turn demand a competitive business environment. Certain elements of such a business environment (such as a market culture) cannot be developed rapidly or established by government action, but other major elements (including the legal and institutional framework) can be. Such efforts are under way in several areas: 
1. Faster, more transparent privatization and improved management of state-owned enterprises. The privatization program was stepped up in 1997 after a disappointing record in 1996, and the Government’s privatization plan for 1998 envisages a further acceleration. The new privatization norms call for an open, transparent, and competitive process -- elements of which were missing in earlier waves of privatization.

You know, there's an inherent trade-off between velocity and transparency of privatization schemes. The faster you push privatization, the more likely it is to turn out to be piratization. Is it really too much to ask that seven years or more after he began poking his nose in Russian affairs that Dr. Fischer might have figured that out by 1998?
... In summary, Russian economic reform is entering a less dramatic phase than that of the last few years: the most important battles in securing macroeconomic stabilization and creating a market economy have been won; but much remains to be done to secure the future growth of the economy. 
Up to this point, the optimists on Russia have been more right than the pessimists. There is good reason to believe the optimists will continue to be right.

Eight months and eight days after Fischer's speech, Russia defaulted.

Dr. Fischer is a thoughtful man who is not always afraid to say he was wrong in the past; but nobody today seems to be interested in giving him a chance to publicly reflect upon anything he has learned from the world-historical mistakes that he and other elite economists made regarding Russia in the 1990s.

Who knows? Maybe he'd like to take this opportunity to apologize to the Russian people ...

But, even if Fischer's conscience is bothering him about the Rape of Russia, it's not that likely that he'll be given much of a chance to apologize for screwing up so badly. There really isn't much of a market for skepticism about the documented track records of Federal Reserve leaders.

Thus, for years Alan Greenspan was treated as a genius by the media, because ... what if he weren't really a genius? What if he were just some Ayn Rand cultist? Well, that possibility was too horrible to contemplate, so everybody agreed to keep him in office over and over until almost his 80th birthday in 2006. What could possibly go wrong?

Instead, it's best not to undermine confidence by asking our economic superiors to account for their track records.

92 comments:

Anonymous said...

The man doesn't have skin in the game and it shows.

Anonymous said...

Did the Russians have a Maidstone Club that had a rather "archaic membership process"?

Anonymous said...

OT: http://forward.com/articles/190011/obamacare-pajama-boy-controversy-wrapped-in-anti-s/?p=all

Anonymous said...

Russia didn't default because of flawed privatizations (which is subsequently reversed). It defaulted because it was dependent on oil exports and oil crashed to $10 per barrel.

Steve Sailer said...

"Russia didn't default because of flawed privatizations (which is subsequently reversed). It defaulted because it was dependent on oil exports and oil crashed to $10 per barrel."

As John Kenneth Galbraith said, "Recessions catch what the auditors miss."

Galbraith's concept of "the bezzle" is extremely applicable to the Russia that Fischer et al helped mold:

http://www.creditwritedowns.com/2009/01/quote-of-the-day-john-kenneth-galbraith-the-bezzle.html

Anonymous said...

Stanley Fischer: Privatization stands out as the most successful element in the Russian reform program.

Once again - feature, not a bug. For those who don't appreciate the sheer chutzpa with which it was done, an example:

Uralmash, the largest heavy machinery plant in the whole USSR (think >100,000 employees and production of all those T-34 tanks that were instrumental in the victory against Germany), was privatized for less than $2,000,000.


Anonymous said...

https://www.numbersusa.com/content/learn/illegal-immigration/jobs-americans-wont-do.html

"A popular argument among pro-amnesty supporters is that illegal aliens are doing work that Americans won't do. But data from the Bureau of Labor Statistics show that in all occupational fields, the the vast majority of workers are American."

---------

Ironically, Sailer is like the Liberal's dream of an illegal alien.

He does reporting or journalistic work that the 'mainsteam' media won't do.

jody said...

how many red bulls per day are you drinking steve?

Anonymous said...

Yeltsin's Russia was one of the great economic disasters in history. But the role of our top leaders in this isn't important. Neither is the fact that Putin became popular by replacing the looting oligarchs and presiding over improved living standards. Nor is the fact that we aggressively expanded NATO after the Soviet Union surrendered the Cold War. What's important to know about Russia is that it's OPPRESSING GAYS.

TGGP said...

Greenspan was a wacko Rand cultist, but as Fed chairman he did quite a good job. He came in having to deal with Black Friday, the biggest single-day stock market crash in our history, and there wound up being NO effect on the broader economy. There's never been another event like it. His tenure included the fall of the Soviet Union and Russia's default, Mexico's economic troubles, the Asian financial crash, Y2K and 9/11. But for America it was mostly a period of prosperity. I think the uncertainty created by his absence played a role in the recent crash. I suppose he is something of a counter-example to meritocracy since his performance seems to outstrip his actual merit, and nobody could understand why he made the decisions he did (I remember people saying getting remarried put him in a good mood, thus a booming economy).

It occurs to me that Jeffrey Sachs was probably the most influential economist in the 80s/90s transition to neoliberalism in poorer nations. The term "shock therapy" originally referred to his work in Bolivia, then later Poland and other post-Soviet economies. Yet most people now (even his detractors) evaluate him based on his Millenium Development stuff in Africa, with Naomi Klein's book "The Shock Doctrine" focusing on Milton Friedman instead of him. I don't have a thesis here, just interesting what's salient & remembered.

Anonymous said...

This meddling in Russia makes you question the sincerity of all the hoopla about gay rights. Putin's Russia is famously one of the few countries where our Great Power economic and military influence runs into limits. If our leaders really cared about gay persecution they could have started a long time ago in places like Saudi Arabia or the Palestinian territories that have depended on US aid while putting gays to death.

Rifleman said...

In the 1990s, a small coterie of economists at Harvard and MIT, such as Jeffrey Sachs, Larry Summers, Andrei Shleifer, Jonathan Hay, and Stanley Fischer...

All but one Jewish?

...played a crucial role in recent history by advising the government of Russia to rapidly privatize its economy. Much of the wealth of Russia wound up being stolen by a tiny number of oligarchs.

All but one Jewish?

They're good at this.

It's like blacks in the NBA.

Anonymous said...

Yeltsin's Russia was one of the great economic disasters in history.

Compared to Lenin's/Stalin's/Khrushchev's/Brezhnev's/Chernenko's/Andropov's/Gorbachev's Russia?

Anonymous said...

If our leaders really cared about gay persecution they could have started a long time ago in places like Saudi Arabia or the Palestinian territories that have depended on US aid while putting gays to death.

When either of these areas attempts to annex the free world, we'll start worrying about gays there. Russian imperialism isn't just a right-wing delusion.

Anonymous said...

Illuminating re: Fischer's dual citizenship. It begs the question of who else - elected or appointed - in our government has dual citizenship....

Anonymous said...

When either of these areas attempts to annex the free world, we'll start worrying about gays there. Russian imperialism isn't just a right-wing delusion.

What are you talking about? Where is Russia trying to annex the free world? OTH, Steve recently did a post about Saudi Arabia exporting its troubled, militant young men to the rest of the world causing trouble wherever they go. Let's also not forget 9-11 and all the fundamentalist stuff they finance.

Anonymous said...

The problem with Russia's privatization wasn't bad economic advice. It was corrupt leadership. I think the view in the West, even among right-wingers, was generally that Communist bloc rulers were misguided, lazy, unimaginative and so on but they were idealists probably a good deal more honest than their Western counterparts. It was only after the heavy-handed corruption that took place that it became clear that they were worse than their Western counterparts in ethical terms and clearly less efficient in purely administrative (as opposed to economic) terms.

Anonymous said...

http://newobserveronline.com/racist-jewish-hypocrites-start-shipping-african-refugees-from-israel-to-sweden/

Jews are so generous that they share their diversity with other nations.

Anonymous said...

"Yeltsin's Russia was one of the great economic disasters in history."

"Compared to Lenin's/Stalin's/Khrushchev's/Brezhnev's/Chernenko's/Andropov's/Gorbachev's Russia?"

You gotta cut Lenin some slack. He had to deal with the Civil War, and he did try the NEP which sort of worked.

Stalin killed millions but he did transform the USSR overnight into the greatest industrial power. He defeated Germany even after a massive sucker punch, and Soviet economic recovery after the war was dramatic--though human costs were horrific.

From the late 50s to the early 80s, life wasn't terrible in the USSR, and people felt their lives were more than bearable.

Gorbachev made a mess but he did try to reform the system. But Yeltsin was a drunkard who just international financialists rip Russia the bone.

agnostic said...

I wonder how pissed he is at US-Iran relations, and the US distancing itself from Israeli cries for action.

I wonder if he'd use his influence near the center of the global economy to teach Iran a lesson that he could only have dreamed of back in Israel.

How best to frame it, though...?

Anonymous said...

Yup. The looting of Russia - and the attendant economic disaster - were unequivocally the direct result of taking economists too seriously. As I've always said, economists sand their outlandish claims should be taken with a pinch of salt at the best of times. All economists elling 'radical transformations' of entire nations if only 'their programs' are adhered to, are invariably snake-oil salesmen, and if you study the case histories of the nations they 'advised' more often than not you'll find no appreciable difference in performance, if not actual disaster.
Basically "economic dogma don't work". An important message that cannot be hammered into the dummkopfs of politicians hard enough. Despite all their claims, their sharp suits, their gray hair, bald heads, glasses all the trappings and appurternances of their particular brand of cargo cult science, it should be remembered by all those who matter that the only 'truth' in economics amounts to little more than a = b or supply is the counterpoint of demand. Everything else is bullshit.

Saying all that, I firmly believe that in the case of ussia in the '90s a western mediated political imperative was in place. Basically the west wanted to smash down the former USSR as quickly, swiftly and decisively as possible. This was mainly done with their placemen such as Gorbachev and Yeltsin, and the west 'advised' policies aimed at breaking down the former Soviet state so rapidly that any backlash could, literally, not catch the breath in order to raise a counter-attack. It was the speed of the dismantling as well as its scope which lead to the disaster.

Anonymous said...

When either of these areas attempts to annex the free world, we'll start worrying about gays there. Russian imperialism isn't just a right-wing delusion.

No, it clearly has become a left wing delusion as well.

Anonymous said...

If you look at the, admittedly, very few nations that managed to genuinely 'pull themselves up from their bootstraps' form third world nations to affluent developed nations, apart from them being all east Asian, the thing you will notice is that their governments carefully nutured economic and industrial development using an array of pragmatic, thoughtful measures, which all had the goal of industrial development in sight.
None of this Friedmanite "cut this, 'liberalize' that, scrap that, import that, abdicate control of that" dogshit, which leaves national governments as about as useful and functioning as a eunuch in "Sexy sorority Girls 3" .
Hence we have the great success story of our times, China, and its signal refusal to listen to the numpties despite Time magazine sternly warning us that "China is heading for a crash" every six months for the past 30 years. Hence also the continued multiple failures of the Latin American states, who from time to time call in the 'smart American experts' to dig themselves deeper into the mire.
And what of Japan in the late 19th century and rubble smashed in the mid 20th - how did they pull of the trick? Or dare I say it, a certain absurd dictator with a Chaplin moustache?

Anonymous said...

My area of expertise. Of course my professor was the guy advising thePolish govt then, a Pole, and they didn't privatise until much later when Poles had capital as they didn't want their industry bought by jews and Germans. Early privatisation was a key error in the IMF program.

Peter the Shark said...

People like Shleifer, Fischer, etc. can't be blamed for what happened in Russia. The Soviet elite simply used Western "experts" to provide cover for their own plans to divide up the assets up the USSR as quickly as possible. The person who deserves the most blame for the collapse of the USSR is probably Gorbachev for being so ineffectual that he allowed a power vaccuum to develop in the first place. The Harvard and MIT boys were simply useful idiots. The question really is whether Fischer realized he was a paid shill, or whether he was so naive he actually thought Russians were listening to him. Either way the implications aren't flattering.

Peter the Shark said...

d Soviet economic recovery after the war was dramatic--though human costs were horrific.

That's great. I too could raise the US standard of living very quickly by having a war kill 30% of the population to create more housing space, employment opportunities and excess assets for the survivors. Then import hundreds of thousands of German young men to work as slave labor for the next 10 years, and stealing billions of dollars worth of industrial plant and raw materials from my neighbors' countries. There was a reason why Stalin's economic model was not sustainable.

Anonymous said...

He [Stalin] defeated Germany even after a massive sucker punch

A tad overrated I feel. Germans inflicted disproportionate casualties on the USSR whether attacking or retreating. Stalin's victory was bought very inefficiently.

And lets not forget that the USSR was never fighting alone. Germany was fighting the US and Britain on land, at sea and in the air the whole time as well.

And lets also not forget the thousands of tanks, planes and trucks the USSR received from the US (and Britain).

Anonymous said...

The Soviet elite simply used Western "experts" to provide cover for their own plans to divide up the assets up the USSR as quickly as possible.... The Harvard and MIT boys were simply useful idiots.

Thus it's purely coincidence that the majority of the resulting oligarchs happened to have a certain ethnic consanguinity with the Harvard boys. Well, that's set my mind at rest I can tell you.

Anonymous said...

For those believe that Russia is sending the homosexuals to Gulags think again. Unlike Qatar, Saudi Arabia or China, homosexuality is not actually illegal. You can go there find a gay club and enjoy anal intercourse with Sergei with no legal ramifications.

This is more equivalent to the growing movement to ban religious display (almost always Christian) in public spaces. This is not some libertarian "let everybody do what they want to do" issue, this is ultimately a clash of civilizations. But unlike what Huntington believed this is not West vs Eastern orthodox anymore, this something so entirely bizarre and alien, I don't think that even just 10 years ago this is what any predictors of future geopolitics could have foreseen

Anonymous said...

"the thing you will notice is that their governments carefully nutured economic and industrial development using an array of pragmatic"

There are other things that one can also be noticed, things that are now unmentionable in Western society. China, Japan and Korea, even the most casual glance at their history should show that they had advanced agriculture, literature, philosophers and technological innovations in their history. Now compare to places like sub Saharan Africa, there is almost 0 evidence of any potential for greatness, East Asia always had that inherent potential. Why the industrial revolution did not start in China is one of those interesting questions of history, but China becoming rich and other not as much is not very surprising to me.

Anonymous said...

The Harvard and MIT boys were simply useful idiots. The question really is whether Fischer realized he was a paid shill, or whether he was so naive he actually thought Russians were listening to him. Either way the implications aren't flattering.

Well, I'm feeling much better now about Fischer's appointment. We can't have too many useful idiots.

SFG said...

Nice detective work again Steve. Couple of questions:

-Wss the looting of Russia good for America? I mean, if he cripped a rival of ours theoretically he was acting in our interests ;)

-If this guy really is as big of a sleaze as you're implying (and at this point I think he's either evil or naive), do you have any back-door connections you can use to slip this into the MSM, or are we stuck waiting for David Brooks or Matt Yglesias to read you without admitting it again? Strikes me as though the far-left wing might have some objections to this guy (globalization etc.), and this sort of dirt might be useful to them. I don't care who takes him down as long as he goes down.

leftist conservative said...

In general, whatever the establishment idolizes or speaks respectfully of, I oppose. Whatever the establishment demonizes, I investigate, fully expecting that more likely than not, it is something I would or should support. Whatever the establishment ignores, I focus in on like a laser beam.

They are the lion and I am the lamb, and I do not lie down with the lion, lest I be eaten.

I am Labor and the establishment is Capital, and ne'er the twain shall, lest in battle.

The battle these days is carried out via propaganda. I launch my pro-Labor, pro-citizen propaganda into the ether, doing battle with the propaganda of Capital, which is globalist, corporatist, pro-plutocrat.

I am a worker, Labor. They are Capital. Know thine enemy....

Jerry said...

The tragedy of the post-Communist rearrangement was that the only domestic elites who had the experience to lead the newly privatized companies were 1980's-era semi-legit businessmen with murky ties to the Communist regime. And the people who were in the position to exploit the situation, again through their experience, were certain segments of the old Communist regime, particularly in the secret services. This was true in all of the post-Soviet economies to some degree, including the Czech Republic and Poland. In Russian things were even worse, of course. A much longer period of Communism, a much more oppressive regime, a less European society.

As a Pole, I've come to think, over the years, that things could not have been handled much better. The best solution would have been a slow, pragmatic opening, and an export-driven economy, something on the model of Korea or Japan. Alas, this was simply not politically possible. After decades of privation, of looking at the Western shop windows from the wrong side of the glass, the pressure for consumer imports was irresistible. Once you have a free trade regime in a wide variety of goods, your own inefficient domestic industries will go to the wall. Especially when, ,for many years after 1990, everything made domestically was automatically assumed to me inferior to Western exports, even when it wasn't.

I wouldn't necessarily see a conspiracy here, but a tendency instead. A conspiracy is not needed when stupidity is the simpler explanation. It is obvious that the West has forgotten the sources of and reasons for its own prosperity. So that it is quite natural that it has botched the 1990 transition, as it has botched every other well-meaning intervention in the affairs of other states during the last few decades, at least since Vietnam.

WE in Poland and elsewhere should have known better, and certainly we would have done better without any Western intervention--particularly in the cultural sphere, where very early on the Western Zeitgeist was all about discrediting nascent patriotism, in the name of preventing the reawakening of some "historical demons," as if somehow it had been Poland that was responsible for World War II. But this is a broad, broad topic, and as for now, I am quite content to see the West suffer from its own medicine, I am pleased when I read about the car burnings in the Paris banlieus, about the Paki gangs in London, and about the diverse and vibrant communities of Malmo and Copenhagen. Let them have it! For once, may it not be Poland's turn to be on the receiving end.

End of rant. Janine Wedel has written two interesting books. One, on the particular topic of Western aid--

http://www.amazon.com/Collision-Collusion-Strange-Western-Eastern/dp/0312238282

--and here again one thinks of all the stupid, harmful Western aid interventions in Africa in the 1970s and 1980s...

and--

http://www.amazon.com/Shadow-Elite-Undermine-Democracy-Government/dp/B007K4NU8S

--a book that might be right up Mr. Sailer's alley with this post.


Hunsdon said...

Peter the Shark said: The Harvard and MIT boys were simply useful idiots.

Hunsdon asked: If they are idiots, should they be given the levers of power?

Anonymous said...

What this means: The Neo-Liberalization of America's Public Sector is at Hand.

VXXC

Anonymous said...

Anon #1: Thus it's purely coincidence that the majority of the resulting oligarchs happened to have a certain ethnic consanguinity with the Harvard boys.

Anon #1: This is more equivalent to the growing movement to ban religious display (almost always Christian) in public spaces.

Kinda ironic to see those two posts sitting right next to one another.

BTW, for those of you who don't have small children, on their Sprout Channel, out of their Washington DC and London branch offices, it's all Hanukkah all the time.

Whereas on their BabyFirst Channel, out of their Tel Aviv branch office, meant for internal consumption only, they never even mention any of this stuff.

The propaganda coming out of their Washington DC branch office is getting so heavy handed that even the crazy ph@t chicks are starting to notice it.

Hunsdon said...

Peter the Shark also said: The Soviet elite simply used Western "experts" to provide cover for their own plans to divide up the assets up the USSR as quickly as possible.

Hunsdon said: Then Russia must be one of the most philo-Semitic countries extant, given how things turned out. Wait, that's not the narrative, is it?

David said...

>this is not West vs Eastern orthodox anymore, this something so entirely bizarre and alien, I don't think that even just 10 years ago this is what any predictors of future geopolitics could have foreseen<

It's a holy war on Amalek.

Anonymous said...

http://www.haaretz.com/mobile/shattering-a-national-mythology-1.242055?v=AA10006B7E78158339FBA4386236E78D

Anonymous said...

From Amy Chua's World on Fire (pg. 78) :

"When I first mentioned to my husband, who is Jewish, that six out of seven of Russia's wealthiest tycoons are Jewish, he raised an eyebrow. 'Just six?' He asked calmly. 'So who's the seventh guy?'"

Chua goes on to attribute this rise of the Oligarchs to Jewish superiority, not finagling.

Page 82: Despite the inevitable rumours, these men did not become billionaires through violence or mafiya tactics. Rather, they became billionaires by playing the game more effectively and ruthlessly than anybody else during Russia's free-for-all transition to capitalism.

Chua also discusses Jewish superiority in Eastern Europe, et al.

Btw, Amy Chua starts World on Fire by discussing how the Filipino Chinese (Chua's background) are clearly superior to ethnic Filipinos.

Mr. Anon said...

"Was Fischer simply embarrassingly naive about what these post-Soviet apparatchiks were up to? Or did he have some clue about the crimes being committed by those claiming to follow his advice? ........................ Or was the looting of Russia more a feature than a bug?"

American jewish economists help russian jewish oligarchs loot russian economy. Certainly there is absolutely nothing that may be construed from this. Let's all just watch "A Fiddler on the Roof" instead.

Anonymous said...

"Yeltsin's Russia was one of the great economic disasters in history.

Compared to Lenin's/Stalin's/Khrushchev's/Brezhnev's/Chernenko's/Andropov's/Gorbachev's Russia?


Compared to the 1945 - 1990 period, yes. There was an incredible recovery in living standards after the WWI/Revolution/Civil War/Real Communism/WWII disaster. This recovery started after the war and accelerated under Khruschov. The standard of living in late Soveit times was relatively high, though of course Western propaganda always denied it. Then in the 1990s the standard of living collapsed. There has been some recovery under Putin.

Anonymous said...

"This was mainly done with their placemen such as Gorbachev and Yeltsin..."

This is how I see what happened:

Gorbachov is a very vane man. When he came to power, he wanted to show everyone how much of an innovator he was, how full he was of original ideas, how different he was from Brezhnev, whom everyone thought old and boring, especially after he had a stroke.

Gorbachov's first new idea was his anti-alcohol campaign. It was actually a good one. People started drinking less and life expectancy went up. But he then got bored with that. It seemed too small.

The Western propaganda machine had been framing the Western package - moral decadence, debt-based, capitalist economics and the rest of it, as cool for many decades. And Gorbachov fell for it. He wanted to be called hip, a brave leader unafraid to challenge old orthodoxies, an innovator and all the rest of it, both at home and abroad. In the end only the abroad part worked out.

I think that he himself was surprised when the reforms he started led to an economic crisis, increased ethnic tensions and the breakup of the country. He was obviously very surprised by his loss of power.

Yeltsin was just a drunk manipulated by the oligarchic looters.

In light of this disaster, from which Russia has only partially recovered, I am very impressed by the people running China. Of course they might eventually screw it all up, in a similar or a different way. But so far they haven't.

While Gorbachov was still in power in the USSR I remember reading Chinese official pronouncements to the effect that his economic reforms were wise, but that his political reforms were not. I'm not even sure about the economic reforms. In the 1980s China was still quite poor, so I guess a complete overhaul of its economy seemed attractive to its leaders. The USSR was doing fine.

Anonymous said...

And lets not forget that the USSR was never fighting alone. Germany was fighting the US and Britain on land, at sea and in the air the whole time as well.

After 1941 the percentage of German forces fighting the Western Allies was always trivial. I think I remember reading that even after D-Day more than 90% of German manpower stayed on the eastern front.

anony-mouse said...

The Russian government is spending $51 billion on its Winter Olympics, (make that Winter Olympics) making it the most expensive Olympics of any type ever.

Oh yeah, and massive corruption too.

What success has any Russian government ever achieved in the purely civilian sphere.

The assumption here is that if the Russian government had done something else it would have been better.

Anonymous said...

"Conversely, the slower pace of privatization in countries like Poland shows that the Rape of Russia didn't have to happen, or least not as disastrously."

Poland was discussed as an example of fast privatization in an international economics lecture I attended. It was used as an argument for shock-therapy. It was compared to other post-communist countries with a slower rate of privatization and economic growth.

Anonymous said...

There's something unseemly and even ominous in the way the looters of Russia have been favored by Western political leaders and in the press: Marc Rich (pardoned by Bill Clinton), Stanley Fischer (made head of Israeli monetary policy and soon to be vice-chair of the Fed), Lawrence Summers and his various appointments, and the numerous Oligarchs granted residence in the UK under Tony Blair.

It's almost as if these Western leaders were involved in or supportive of the looting.

Anonymous said...

Per commenter above: Israel knows how to embrace racial diversity. Another story about it here.

Taki's Filthy Foreign Lucre said...

As far as I know, nobody has ever accused Fischer of attempting to unethically profit off of the disaster he helped create in Russia, as the Federal government fined Shleifer and Harvard for doing.

The federal government never fined Shleifer for, or even accused Shleifer of, profiting off a disaster. They fined him for violating a conflict of interest provision in Harvard's contract by owning stock in Russian companies. The feds never argued that he made improper profits from that stock or that his work was in any way compromised. They certainly never claimed he caused any kind of disaster.

Is it too much to expect you to stop lying about this?

Ricky Vaughn said...

Wow, so incredible! It's almost like the US economists and Russian mafia had something in common. Perhaps an ethnic, or maybe even religious component? And they used "scientific" economic arguments to mask a hidden agenda.

Wow, someone really should look into this. It seems really Fischy. Something is not kosher about the whole affair.

Whiskey said...

Steve, more troubling than Russia (it was not called the Washington Consensus for nothing, rapid privatization was viewed as the only aggressive "chemotherapy" that could save a Russia already collapsing rapidly) was his policy in Israel.

As you noted, Fischer devalued the shekel to help exporters. Ditto the Fed, the ECB, Bank of China, and Bank of Japan. Again, consensus, and international at that.

What is bad about that is helping exporters with race-to-the-bottom devaluation, hurts consumers who pay for goods in their domestic currency. Much of Israel's current crisis stems from people being priced out of homes and even daily necessities as Israeli oranges are cheaper in Europe and India but imported grains, energy, clothing etc are far more expensive.

It is insider gains, public pains.

Gubbler of the Society of Reformed Chechenistics said...

http://www.examiner.com/article/nigerian-nurses-stole-identities-of-thousands-of-hospital-patients-va

Chua is right. Nigerians are indeed clever and ambitious.

Anonymous said...

What an article. Russian GDP per capita has tripled since 1990. Oh but some Jooz made money and a Joo advised Russia on privatization . It all adds up now. The whole scheme.

Henry Canaday said...

What wealth of Russia? The oil did not generate any economic rent until prices went well above $20 per barrel, at which point the Russian government rewrote their royalty agreements with the private oil firms.

If there was any other wealth, I’ve missed it. After four decades of competing vigorously with the U.S. on military aircraft, Russians could not build a passenger plane that even Russians wanted to fly in. And after 70 years of brain-dead communist economics, the only assets Russia had were the resources God or nature put in the ground. Even there, the infrastructure for exploiting these resources was such a disaster that they yielded only the most marginal returns.

Ali said...

I don't think there was much perception that Russia had a criminalistic, corrupt culture in the waning days of the Cold War. None of the popular culture of the time reflected it. It was mostly seen as a grim dictatorship where the Commie "rule of law" was enforced by heavy punishment. Economists back then assumed it was an orderly society where privatisation would work just like it did in sclerotic socialist economies such pre-Thatcher Britain.

Shawn said...

Sweden gets Israel's illegal infiltrators. What is Sweden thinking.

http://www.jpost.com/National-News/Eritrean-migrants-resettled-from-Israel-to-Sweden-337414

Anonymous said...

As if the rape of Russia wasn't bad enough, now there's the boof of Russia in the form of WWG.

Gubbler of the Society of Reformed Chechenistics said...

"People like Shleifer, Fischer, etc. can't be blamed for what happened in Russia. The Soviet elite simply used Western "experts" to provide cover for their own plans to divide up the assets up the USSR as quickly as possible."

There is truth to this, but when the dust settled, 12 of the 13 biggest oligarchs were Soviet Jews(who were also trying to buy up all the media outlets).... until Putin changed things a bit.

Do you think American Jews would have gotten so involved in the privatization if there was nothing in it for their own tribal brethren?

And if Jews don't think in Jewish-power terms, why are American Jews so pissed with Putin after he took on the oligarchs? Do you think Jews would be so miffed with Putin if those oligarchs were all Armenian, Georgian, Russian, Chechen, or Azerbaijani?

Why are so many American Jews so angry about the fall of some of the Soviet oligarchs? Could their common ethnicity have something to do with it?
I don't see American Jews getting angry about the Chinese communist party bringing down some Chinese oligarch or tycoon. No, they seem especially upset with Putin's Russia. Why?

Anonymous said...

"That's great. I too could raise the US standard of living very quickly by having a war kill 30% of the population to create more housing space, employment opportunities and excess assets for the survivors. Then import hundreds of thousands of German young men to work as slave labor for the next 10 years, and stealing billions of dollars worth of industrial plant and raw materials from my neighbors' countries. There was a reason why Stalin's economic model was not sustainable."

Even so, Stalin built a mighty empire on piles of human bones.
In contrast, Mao killed millions more but left China utterly poor and backward when he died.
Stalin destroyed the old to build the new. Mao destroyed the old to destroy the new as well.

Stalin killed 7-10 million during the Great Famine and left USSR stronger than ever. Mao killed 40 million during the Great Leap and left China poorer and more backward than ever.
So, not all horrors are the same. Some get stuff done.

And let's keep in mind that American economy in the 19th century owed a lot of slavery in the South, ethnic cleansing of Indians, Chinese rail workers, and whites toiling in awful conditions in factories.
True, Stalinism was far more brutal, but within a few decades, Stalin did transform the USSR into a genuine powerhouse nation.
And considering the amount of damage USSR suffered in WWII, whereas American mainland suffered none, the recovery was fast and cannot be credited entirely to oppression and slave labor.

Steve Sailer said...

"What wealth of Russia?"

Aluminum factories, for one.

Anonymous said...

Some Jews pulled a fast one, but you gotta blame Russians too. Russians took power from the Jews under Stalin and later leaders, but they made a royal mess of the Soviet Union.

And Yeltsin messed up his own life and reputation with too much boozing and clowning around. Too many Russian men are like him, and if a people won't guard their henhouse and fix up the farm, the foxes are gonna have a field day.

Even after so many yrs of Putin, so many Russians are still drunkards, clowns, thugs, brutes, and idiots. And many Russian women are trash.

Anonymous said...

"What an article. Russian GDP per capita has tripled since 1990. Oh but some Jooz made money and a Joo advised Russia on privatization . It all adds up now. The whole scheme."

Russia did badly through much of the 90s but did pretty okay since the 2000s, especially with spike in oil and gas prices. US shale revolution might undermine Russian economy in the future.

Btw, if most Jews are Liberal and for equality, shouldn't they have been offended by how a handful of oligarchs--many of them Jewish--grabbed so much of the pie during the Yeltsin yrs?

Jewish Liberals talk a good game about 'equality', but all and done, they prefer more inequality with more Jewish riches than more equality with less Jewish riches.

Peter the Shark said...

Thus it's purely coincidence that the majority of the resulting oligarchs happened to have a certain ethnic consanguinity with the Harvard boys.

I never said it was a coincidence. I'm saying the Harvard boys didn't call the shots in that relationship. Soviet (and Israeli) Jews in my experience are generally a lot sharper and more worldly than US Jews. While Fischer and Shleifer may have felt tribal loyalty to the Soviet Jews, I can guarantee you the Soviet Oligarchs felt no such tribal loyalty to Fischer and Shleifer.

What a lot of ethnic emigres from more tribalistic countries like Ireland, Sicily, Russia or China fail to recognize is that the second you leave and become a success, the people back in the old country don't consider you one of them any more. You are now just someone with money and connections they can exploit. It's even true of Jews and Armenians.

Anonymous said...

Russians could not build a passenger plane that even Russians wanted to fly in.

The Soviet Union built perfectly fine passenger planes. By the way, deindustrialisation was a part of the looter-oligarch program. Modern Russia doesn't build nearly as much stuff as pre-1990 Russia did.

What an article. Russian GDP per capita has tripled since 1990.

The GDP of post-Soviet states cratered during the period of oligarchic looting. Just look it up.

Peter the Shark said...

Stalin killed 7-10 million during the Great Famine and left USSR stronger than ever

Who are you really? Pete Seeger? What a load of leftist nonsense. Russia was stronger than ever in 1913. Then the Bolsheviks spent the 20 years after the Civil
War destroying all the progress Russia had made in agriculture over the previous century, diverting a vast amount of resources into economically unviable heavy industry, and destroying standards of living across the country. Russian individuals in 1937 on average were far worse off than the Russians of 1913 by any consumer metric - nutrition, housing, clothing, etc. Then Stalin got lucky and won a war of attrition against a major but far smaller industrial power which allowed him to collect enough booty and territory to finance some true economic growth. Without WWII Stalin would have gone down the same path as Mao.

Anonymous said...

"Russians took power from the Jews under Stalin and later leaders, but they made a royal mess of the Soviet Union. "

Western media described it as a mess. But that's not how Russians saw it then or see it now. I know this must surprise you, but Western media lies a lot.

Anonymous said...

"Western media described it as a mess. But that's not how Russians saw it then or see it now. I know this must surprise you, but Western media lies a lot."

Look, the Soviet system was unsustainable. Though Soviet citizens didn't get much out of the system, they were still getting much more than the economy could hope to produce. At least Stalin whipped the people into shape. In the post-Stalin era, absenteeism and tardiness came to be tolerated at all levels of the economy.

The system needed to change, but so many Russians were just lethargic and without initiative. Such attitude was partly due to communism, but it's also true that Russians were never known for their work ethic.

Before WWI, much of the Russian economy and institutions were developed and managed by Germans--and increasingly Jews. So, there's a long history of Russians having OTHER peoples fix and manage their own problems.

Russians are not without talent, but the culture is pretty lunkhead and messy.

Steve Sailer said...

SFG asks: "-Was the looting of Russia good for America? I mean, if he cripped a rival of ours theoretically he was acting in our interests ;)"

The conspiracy theory that the Harvard-MIT shock therapy plan of deindustrialization was a CIA plot to cripple a superpower rival so that it could never again have the 53,000 tanks it had in 1985 is not unpopular in Russia. And it doesn't strike me as absurd, either. After all the U.S. government paid the Harvard-MIT advisors.

Marc Rich who taught the future oligarchs how to sell their factories for scrap got pardoned by the President in 2001 at some cost to Clinton's short term reputation. Maybe Rich was an American agent of influence?

Anonymous said...

"Who are you really? Pete Seeger? What a load of leftist nonsense. Russia was stronger than ever in 1913. Then the Bolsheviks spent the 20 years after the Civil
War destroying all the progress Russia had made in agriculture over the previous century, diverting a vast amount of resources into economically unviable heavy industry, and destroying standards of living across the country. Russian individuals in 1937 on average were far worse off than the Russians of 1913 by any consumer metric - nutrition, housing, clothing, etc. Then Stalin got lucky and won a war of attrition against a major but far smaller industrial power which allowed him to collect enough booty and territory to finance some true economic growth. Without WWII Stalin would have gone down the same path as Mao."

Don't be a silly child. Russia lost to Japan in 1905. Russia lost to Germany in WWI even though Germany also had to fight France and UK.
While the average Russian might have eaten better in 1913 than in the hellish 1930s with the man-made famine, the USSR that Stalin created kicked Japanese butt so bad that the Japanese peed in their pants when they thought of Russians and dared not fight them in north Asia again.
Also, Nazi Germany was far more powerful than Germany in WWI when airplanes were still dinky things and tanks were first introduced as moving tin cans.
But USSR not only weathered the full assault but rolled back the tide and even invaded Germany and most of Eastern Europe.
Stalin did turn USSR into a great power. He killed a lot of people, and he has to be seen as a very evil man. I would also say the history of all of Europe would have been better if commies had not won in Russia. The economy would have grown more gradually and more humanely. Also, without the communist threat, the Nazi party would likely not have won over the support of German conservatives.

So, Soviet communism was bad stuff, but we gotta give credit where it's due. Stalin made communism work in his own brutal way, and USSR did become a superpower under him.
Also, while millions suffered terribly under him, many did get something out of the system: literacy, urban life, new opportunities, and the pride of being part of a great empire.

There was genuine support for Stalin in many parts of Russia where lives did improve.

Anonymous said...

"Look, the Soviet system was unsustainable.
The system needed to change..."


No, I don't believe that. It's a mix of Cold War Western propaganda and post-facto justification of the looting. "It was going to collapse anyway." My response to the oligarchs is "no, it was doing fine until you started looting it." And I don't think it's a flippant response, I really do believe that. The USSR wasn't massively in debt. There was no hint of popular unrest. Everyone at the time, including the CIA (it produced reports to that effect), thought that the USSR was doing fine.

Are Russians as hard-working and disciplined as Germans? No. But who is? The fact is that the standard of living in Russia was much higher in the 80s than in the 90s. THAT's an apples to apples comparison.

Anonymous said...

"Uralmash, the largest heavy machinery plant in the whole USSR (think >100,000 employees and production of all those T-34 tanks that were instrumental in the victory against Germany), was privatized for less than $2,000,000. " - I can say Fraudulent conveyance.

Anonymous said...

Steve, on deindustrialization:

The 1990s brought the former Soviet space up to speed on absolutely everything that's been going on in the West since the war. Feminism, gay lib, drugs, porn, substandard educational practices, abstract art (yes, the USSR had it in the 1920s, but that was when it was really Communist). And deindustrialization. Sometime around 1989 or 1990 Russia was signed up (it didn't do it herself) for The Package. Not making much of real value is a part of The Package.

To what extent was this a premeditated plot? My view is that Gorbachov's vanity and lack of street smarts opened a window, which everyone who had always wished Russia ill and who had always wanted to make a buck off Russia proceeded to use.

If there was a pro-American plot within the US government to deindustrialize Russia, then the authors of that plot would have surely fought against the deindustrialization of the US. Instead the powers that be in the US have worked to accelerate America's own deindustrialization.

SFG said...

"The conspiracy theory that the Harvard-MIT shock therapy plan of deindustrialization was a CIA plot to cripple a superpower rival so that it could never again have the 53,000 tanks it had in 1985 is not unpopular in Russia. And it doesn't strike me as absurd, either. After all the U.S. government paid the Harvard-MIT advisors.

Marc Rich who taught the future oligarchs how to sell their factories for scrap got pardoned by the President in 2001 at some cost to Clinton's short term reputation. Maybe Rich was an American agent of influence?"

I'd buy that.

Here's something I don't know, and I need someone like you to check out, because I'm biased: logically, if Judaism is an evolutionary group strategy, Jews should act to strengthen their brethren around the world. Wouldn't that mean, in many cases, strengthening the hand of the USA? I mean, if America is an instrument of Jewish power, as many around the world seem to believe, then wouldn't you, as a Jewish oligarch, want America to be as strong as possible?

The atrocious BHL, whatever his other awful defects, doesn't actually seem to be anti-American.

Anonymous said...

Henry Canaday said: Russians could not build a passenger plane that even Russians wanted to fly in

Bullshit. Tupolev Tu-154 and Ilyushin Il-62 were the two workhorses of Russian long and medium distance aviation. In both technical specifications and safety record they were perfectly average among the planes in their class.

David said...

>At least Troll whipped the people into shape. In the post-Troll era, absenteeism and tardiness came to be tolerated<

Anonymous said...

Given the discussion of the role the US played in the piratizing of Russia's wealth, and the comments regarding similar plans from our Polish reader, a case can also be made about the US playing a role in the breakup of Yugoslavia. Some think we wanted to break it up because we wanted to privatize its assets. Remember Yugoslavia, though communist, was not in the same condition as the Warsaw Pact nations. It had become a socialist nation that traded with the West, attended the LA Olympics and was not about to collapse like the other Eastern Bloc countries.

If you are interested look up the 1991 Foreign Operations Appropriations Law HR 5114. This law had a provision specifically forcing the ethnically diverse nation to hold elections in each republic. Its effect helped start the process to breakup this socialist nation and make available its assets to private investors.

SEC. 599A. Six months after the date of enactment of this Act, (1) none of the funds appropriated or otherwise made available pursuant to this Act shall be obligated or expended to provide any direct assistance to the Federal Republic of Yugoslavia, ... That this section shall not apply if all six of the individual Republics of the Federal Republic of Yugoslavia have held free and fair multiparty elections...

Anonymous said...

In 1996 Yeltsin was up for re-election. He was deeply unpopular because of the disastrous corruption in industrial privatization. And yet he won the '96 election thanks to massive support, financial and otherwise, from the oligarchs. It goes to show how elections, even if reasonably free and fair, don't prevent someone who the general public knows is working against them from winning.

Anonymous said...

If Judaism is an evolutionary group strategy, Jews should act to strengthen their brethren around the world. Wouldn't that mean, in many cases, strengthening the hand of the USA? I mean, if America is an instrument of Jewish power, as many around the world seem to believe, then wouldn't you, as a Jewish oligarch, want America to be as strong as possible?

Perhaps Steve wants to believe that in regards to the Cold War, but no, I don't think things work that way. If a minority isn't instinctively hostile to the majority, it ends up being assimilated. It eventually disappears as a separate entity. The only minorities that remain standing are ones who have some sort of a defense against identifying with the majority, against wishing it well.

Anonymous said...

"And yet he won the '96 election thanks to massive support, financial and otherwise, from the oligarchs. It goes to show how elections, even if reasonably free and fair, don't prevent someone who the general public knows is working against them from winning."

Well, it didn't help that the opposition was made up of people like Zhirinovsky and neo-communists.

Anonymous said...

Here's something I don't know, and I need someone like you to check out, because I'm biased: logically, if Judaism is an evolutionary group strategy, Jews should act to strengthen their brethren around the world. Wouldn't that mean, in many cases, strengthening the hand of the USA? I mean, if America is an instrument of Jewish power, as many around the world seem to believe, then wouldn't you, as a Jewish oligarch, want America to be as strong as possible?

Developing symbiosis requires sharing the same fate, through thick and thin, for extended periods of time.

Hunsdon said...

A quick comment on Yeltsin. He was not always the bumbling drunken oaf we remember him as.

<a href="http://news.bbcimg.co.uk/media/images/54697000/jpg/_54697295_tank_reu464.jpg>Boris in '91</a>

Anonymous said...

Henry Canaday:
the only assets Russia had were the resources God or nature put in the ground.

Frankly, who would want to posess the resources in the ground of a country the size of:

the United States,
South Africa,
Libya,
Iran,
Angola,
South Africa

combined.

Besides those minor assets, don't even mention gold, diamonds, or rare earth metals

Anonymous said...

Hunsdon 5:38 PM, your correct link.

Anonymous said...

I remember people talking about Yeltsin being an alcoholic BEFORE he became president of Russia. This is probably why he was pushed to the top.

If I remember correctly, a year or two before Gorbachov lost power Yeltsin made some sort of a visit to America. It was said (not on Soviet news, but privately) that Yeltsin was drunk throughout that visit and that he made himself look like a fool.

I've known that Yeltsin was a drunk clown for almost as long as I've known who he was. I think that this is true of most Russians old enough to remember this.

Anonymous said...

Developing symbiosis requires sharing the same fate, through thick and thin, for extended periods of time.

Indeed, so perhaps a better illustration of the relationship would be this one from Goodfellas.

Anonymous said...

Poor poor Russia. Taken advantage of even though their per capita income has tripled. And they are so innocent there. They don't stand a chance against mighty Fischer. And the looting. My my. The Communist Party Nomenklatura held it all "for the people". Not like those Looters. The usual deranged comments.

Fischer should not be appointed because he holds foreign citizenship but not because he gave advice to Russia. This article is insanely obessesive.

Anonymous said...

Anonymous 6:43.

"Income has tripled" - Yup, income has tripled from a low, low base, right from rock bottom. Don't try to pull of those cheap tricks here, we're not Economist reading naifs over here.
Also the world oil price more or less tripled over the same period, giving Russia a unique lifeline, and Putin cleaned things up somewhat.

steve button said...

It wasn't the 'West' that wanted to smash communism in Russia...it was the Jews who wanted to smash Russia for removing the Jewish elite and making communism a truly Russian affair...50's-80's were this time. Would make an excellent thesis for someone's graduate paper. Or maybe not...

reiner Tor said...

I guess nobody is even reading this anymore, but can't help making a few remarks.

After 1941 the percentage of German forces fighting the Western Allies was always trivial. I think I remember reading that even after D-Day more than 90% of German manpower stayed on the eastern front.

That's not exactly true. After D-Day, maybe 60% or less of manpower stayed on the Eastern Front.

Moreover, 40% of German war production went to the air force and air defense, and roughly two thirds of those were fighting the West already by spring 1942. Add to this production devoted to the navy (maybe 10%), plus the percent of the army fighting Westerners (never zero, with the Afrikakorps and the relatively small, but still existing amount of troops they needed to keep in France to prevent an invasion) and you already have more than a third, possibly even over 40% of German war production devoted to fighting the West already in 1942.

Russia received just a small percentage of its battle tanks in 1941-42 from the West, but in late 1941 with all the catastrophic losses from earlier that year they provided a not insignificant portion of operable Russian battle tanks, I've read accounts claiming a third, because the first batches arrived maybe in October 1941, when Russia's own battle tank reserves were depleted, the most important production centers fell and were in the process of evacuation and production in the Ural didn't yet pick up. So during the battle of Moscow they were in all likelihood crucial. Also during Stalingrad in the Caucasus the local forces were equipped with complete Lend Lease equipment, because that lay on the route through Iran. Logistically it would have been a nightmare to supply the Caucasus region from the rest of the country with the battle raging in Stalingrad. So Western aid might have been crucial in averting the Germans there, which would have freed up German troops from the South and may have prevented the loss at Stalingrad altogether.

Moreover, that's just the weapons. Most of the Western aid to Russia was in the form of trucks and other vehicles, telephone cables and telephones, radio equipment, food, boots and clothing, etc. etc. Without these, the USSR might have stopped the Germans (again, remember, fighting against the West as well), but wouldn't have been able to reach Berlin.

Steve Sailer said...

Indeed.

The air war was extremely expensive. Even ancillary parts like radar installations required a massive investment. Steve Blank's "Secret History of Silicon Valley" makes clear how much effort was spent by the Germans and the Anglo-Americans on radar and counter-radar efforts.

reiner Tor said...

Steve, I'm happy to find you still awake. Let me just add that the air war also cost in terms of lost production, which I forgot to mention. Without that, the Soviets would have had an even worse time. Stalin privately acknowledged that, at least somewhere I read that he said (maybe according to Khrushchev? who knows if it's true or not) that "had we fought the Germans alone, we wouldn't have won".