Jan 02 2007

Defending Russia’s Enrons and Skillings

Published by at 9:39 am under All General Discussions

I find the Litvinenko vs Putin story to be an intriguing example of the double standards of the news media. I am not talking all the media, but the perponderance of stories regarding the Litvinenko death revolve around blind allegiance to those people who became obscenely rich after the Soviet Union fell and who took control of a country that could not keep bread on the market shelves. Yeltsin really bungled the transition to a western economy and put the vast majority of average Russians into severe economic distress. In 1998 the Russian economy was on the brink, with the value of the Ruble tanking and wiping out what little savings anyone had. The debacle began in 1992, with massive food lines, and continued through out Yeltsin’s rule.

During this time the Russian Oligarchs were taking control of the entire Russian economy. These people had a strangle hold on every aspect of Russia and were basically out of reach of the government. Instead of a democracy Russia was more like a mafia run corporation. Russia’s key industries and natural resources were being used to secure massive personal wealth for a few, and for many years the ones suffering were the people.

Now I am a free market conservative, but I also understand there must be limits on how much power can be horded into unelected hands. The breaking of monopolies was a key element in the broad success of the US economy. And while unions today are a shadow of their former selves, their efforts to end the exploitation of the average worker and allow them to not only create personal wealth, but to live a reasonable life for themselves and their families, was also a key enabling factor in our economy. People grow an economy when they can share in the results. People will utilize their intellectual powers and dedicate themselves if there is a reasonable reward to be had. None of this existed in the post Soviet Russia because the modern version of the robber barons of old had taken control of Russia from the elected representatives of the people.

The old Soviet control had transformed from a government centered operation to an economic centered one. But surprisingly the media, in a total reversal of how they treat the insanely rich oil men of the US, have somehow become completely enthralled with the Russian Oligarchs. Probably because they shower the media with attention and access to swanky parties (the news media’s achilles heal – their desire for access to the rich and famous). Check out this romanticized reporting on Russia’s oil baron – their Skilling – and how his Enron was controlling the economic life blood of Russia:

When the neat and Western-looking young law graduate from St Petersburg first became president in 1999, it seemed certain that he would strive to westernise Russia. His favourite subject was Russia’s urgent need for more legality in all things, with fair and independent courts, honest and professional police forces, even competent lawyers. Putin also seemed to favour foreign investment and the continued liberalisation of the Russian economy. Not much remains of these hopes.

When Mikhail Khodorkovsky, then Russia’s richest man, started to campaign for the presidency in 2003, he was arrested and charged with tax evasion. In the ensuing trial, the judges rejected almost every defence motion, and accepted almost every prosecution motion, and their 662-page verdict in May 2005 repeated the prosecution’s accusations almost word for word.

In August 2005, Khodorkovsky, already in prison to serve a nine-year sentence, said he would run for parliament. Legally he was entitled to do so while his case was still in the appeal court, a process that usually takes a year or so. Instead, the final verdict came in two weeks – wholly unprecedented – precluding any parliamentary campaign. By then, nobody could believe either in Khodorkovsky’s guilt, or in the independence of the courts that found him guilty. Once again, whoever sits in the Kremlin is not subject to the law and, instead, controls its application.

Only if poor old Skilling (and all the other corporate crooks who have been tried and convicted here in the US) could have had this kind of fawning press! I have no doubt this is a sugar coated version of events that deliberately overlooks much of the crimes this man may have committed. The richest man in Russia running for President? Do we want Bill Gates for President? He controls a major chunk of our economy already – would we trust him as he oversaw a justice department that is charged with enforcing corporate monoploy laws? Where is the representative of the people?

Putin’s big sin, to these non-expert eyes, was to take back those elements critical to Russia’s economy and to either put them into government control or break up the monopolies. I have yet to see him place a single major company or resource into his personal holdings – which these people did when the Soviet Union broke up. I may be wrong here. As I admit, I am not an expert on Russia. But even a non-expert like me can sniff out the hypocrisy of this story. The Oligarchs have their Western and American counterparts. They are the Enrons and Haliburtons. And we all know how the media treats these marginal companies in the US. Haliburton iis not Exxon and Shell and BP all rolled into one – like Yukos was in Russia. But fear that they may be benefitting because Dick Cheney was their CEO before taking office runs rampant in the fevered swamps of liberalism. But these same swamps see the jailed Yukos executives as modern day Robin Hoods – even though there is not one shred of evidence to support that claim. And in fact, the truth seems to be more Godfather than Tooth Fairy. I may be no expert – but I am not one who is easily fooled by facades and fairy Tales either.

3 responses so far

3 Responses to “Defending Russia’s Enrons and Skillings”

  1. Barbara says:

    I agree with everything you have posted in your article. I have never understood why so much sympathy could be garnered for these people. This would be like a small group of people taking over ownership of all the national parks, federal land and mineral rights in our country for their own benefit. I wonder how the media would scream then. But maybe not if one of the new owners was a media darling. Bereszovsky is one of them though and has probably bought a lot of them one way or another.

    Russia is a dangerous place to live in but it is tons better than it was in the past. Putin may not be wonderful by western standards but there seems to be a whole lot more freedom now. And he did turn the economy of the country around. In Stalin’s time and even in his successor’s time a dissident was either killed outright or sent to Siberia for the rest of his life. Now there are dissidents all over walking around free. There is a lot of murder in Russia but there always has been. Putin had to contend with the oligarches, the mafia, a horrible economy, and all sorts of graft and corruption. Although it sound like it, I am not defending Putin as much as calling like it is. The oligarches stole the Russian economy and like our corporate crooks should pay for it with prison time and fines. There should be restitution for the money they stole. And the idea of one of them becoming a member of parliament while still in prison is ridiculous.

  2. For Enforcement says:

    Very interesting perspective, I hadn’t actually been looking at it that way, but do agree that you are probably correct in your assessment of the situation. I think Putin’s reservation about giving up power is in what would take his place. More of Yeltsin? The country couldn’t stand another one of him. Khodorkovsky? It sure doesn’t need him. I hope Russia becomes and remains a capitalist country. The world will be better for it.

  3. RichatUF says:

    AJ says:
    The debacle began in 1992… closer to 1917

    I’m being cheeky, but your point is taken. One thing about Yukos and Khodorkovsky and about Russia generally. The List

    Khodorkovskyarrested on 25 OCT 2003

    Oil-for-Food ends 21 November 2003