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Alternatives to Neo-liberalism by Alex Callinicos

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Corporatist Corruption: Systemic Fraud under Clinton-Bush-Obama Regime Harvard Mafia Friedman --founder of Chicago school of deification of market Republican Economic Policy Monetarism fiasco Small government smoke screen The Decline of the Middle Class
Libertarian Philosophy Media domination strategy Neoliberalism Bookshelf John Kenneth Galbraith Globalization of Financial Flows Humor Etc

Reprinted from Socialist Review

Feature by Alex Callinicos, July 2006

Advocates of the free market constantly repeat the refrain that 'there is no alternative'. Alex Callinicos believes that for the movement to be able to answer this claim, it needs to reassert the viability of democratic planning.

The tide of revolt against neo-liberalism continues to rise. In Europe this is most evident in France. Within the space of barely a year the neo-liberal pens�e unique (sole ideology) suffered two stunning defeats � first the victory of the left No in the referendum on the European Constitution, then the social insurrection against the CPE law aimed at limiting the rights of young workers.

But these victories pose ever more sharply the question of what the alternative to neo-liberalism should be. The tired old gibe against the movement for another globalisation � that it is just against the status quo and lacks any positive programme of its own � gains more of a bite as the movement scores real victories.

There are some efforts within the movement to address this challenge. For example, following the French referendum, activists in the altermondialiste movement (movement for another world) launched a project to draw up a Charter of Principles of the Other Europe as an alternative to the neo-liberal Constitutional Treaty. Following a conference in Florence last November, a seminar was devoted to the subject at the recent European Social Forum in Athens.

The drafts that have so far been made of the charter are pretty uncontroversial. They concentrate on extending existing human rights by giving precise definition to a set of "common social rights" that would, for example, protect public services from being preyed upon by trans-national corporations eager to profit from the policy of privatisation being implemented by virtually every government in the world.

The charter belongs firmly to the ideological world of post-war social democracy. In a classic essay the sociologist TH Marshall traced the way in which the concept of citizenship has been extended over the past two centuries � from civil rights (e.g. personal freedom, private property) through political rights (above all, universal suffrage) to social rights (e.g. employment, welfare provision, education). The neo-liberal "Counter-Reformation" is essentially trying to roll this process of widening citizenship back by taking away the social rights represented by the post-war welfare state.

In this context, defending these rights is essential. But it's one thing to do this, quite another to imagine that, on their own, they constitute an alternative to neo-liberalism. The reigning Washington Consensus represents a very pure version of the logic of capital itself, in which everything possible is turned into a commodity. Rejecting this requires the introduction of a different social logic, but the charter is silent on what this might be.

Challenging private property

One key issue here is property rights. If just about everything is to be made into a commodity then the rights of individuals and corporations to own things � including abstract properties of things such as genes � and to exclude others from using them must be entrenched. One of the main thrusts of the neo-liberal agenda, which has been pursued very strongly by international financial institutions such as the World Bank and the World Trade Organisation, has been to reinforce and extend the right of absolute private property.

So what does the movement for another globalisation say about this? What conception of property does it put forward as an alternative to the neo-liberal drive to carve out the world into plots privately owned by the corporations and the rich? This is not an academic question. On 1 May 2006 Evo Morales, newly elected president of Bolivia, sent in the army to seize oil and gas installations to enforce his decree resuming state control of the hydrocarbon industry. Nationalisation of the industry was the main demand of the mass insurrection of May-June 2005 that drove right-wing president Carlos Mesa from office.

In fact many altermondialistes are uneasy about this kind of demand. Last October I found myself in a minibus negotiating the choked traffic of Mexico City as its passengers � intellectuals and activists from all over the world � argued passionately over whether or not the Bolivian movement was right to raise the demand of nationalisation. Similarly, the draft Charter of Principles waffles on the issue of property:

"The functioning of these public services and the use of common goods � soil, air, water, and energy � needs the implementation of social property projects. What we need to do is inventing a new kind of socialisation, which is not national or governmental property, and which allows people and workers to take part in the decision-making process concerning the organisation, functioning and designing of public services."

These contorted formulations don't just reflect the way in which English is often conscripted into the service of a multilingual movement that struggles to communicate with itself and with the world. Behind the suspicion of nationalisation lies the memory of the bureaucratic state ownership introduced by Stalinism in the East and social democracy in the West. But more immediately influential is the ideology of autonomism, summed up by the title of John Holloway's famous book Change the World Without Taking Power. In other words, we should forget about the state and try to develop localised alternatives to neo-liberalism.

Holloway's approach is hopeless as a general strategy. It is equally hopeless when confronting the issue at hand. The Bolivian people want to reverse the privatisation of hydrocarbons. This poses the question of what happens to the hydrocarbon industry when it is taken away from foreign multinationals such as Repsol YPF and Petrobras. Inevitably this raises the question of ownership. In the first instance, there seems to be no alternative to nationalisation (if anything, Morales could be criticised for restoring state control on a basis that fell short of 100 percent state ownership).

The state is a national organisation with both the coercive power and political legitimacy required in order to carry through something as ambitious as the takeover of the hydrocarbon industry. Moreover, that legitimacy depends critically on the state being able to present itself as responsive to popular demands. This makes it amenable to pressure from below � from mass movements such as that in Bolivia. Before becoming president, Morales, the leader of the Movement for Socialism, actually opposed the demand to nationalise the hydrocarbon industry. The measure was forced on him by the movement that brought him to office.

None of this means that we should repeat the old mistake of traditional social democracy and identify the existing state as the main agency of progressive social change. It is a capitalist state that may respond to mass pressure, but it nevertheless will seek to maintain the domination of capital. To that end it is organised in a bureaucratic and hierarchical manner that seeks above all to exclude popular participation, initiative and control. That's why the revolutionary Marxist tradition has always argued that any successful revolution against capital has to destroy this state and replace it with institutions based on rank and file democracy, through which working people can govern themselves.

So nationalisation on its own isn't enough. This doesn't alter the significance of what happened in Bolivia. After decades when public assets were sold off for private profit, popular revolt against neo-liberalism has actually forced one government to take something back � and not just any old something, as is made clear by the howls of agony sent out by the global political and business establishment when the Morales government seized the oil and gas industry.

This experience confirms these remarks by Antoine Artous of the Ligue Communiste R�volutionnaire in France, "I don't see how we can unleash a dynamic of social transformation without, if not straight away overthrowing, at least profoundly modifying certain property relations." Artous goes on to point out that nationalisation isn't enough, "The whole concept of social appropriation can't be reduced to the simple legal transfer of titles of property. It presupposes a wholesale challenge to the capitalist division of labour (the hierarchical organisation of production) and its replacement by cooperative forms of production."

Market or planning?

Indeed, really to break with the logic of neo-liberal capitalism, any extension of the boundaries of state ownership would have to involve the introduction of forms of democratic self-management through which the workers of the nationalised industry together with the consumers of their products could collectively decide on how it should be run for the common benefit. Again, this is more than an academic question. The radicalisation of the situation in Venezuela, where President Hugo Chavez espouses a "21st century socialism" in defiance of the US, has put onto the agenda the issue of alternative forms of economic organisation.

Seriously addressing this question means breaking another taboo and talking, not just about state ownership, but also about planning. From the 1930s onwards planning became identified with the bureaucratic command economies of the Soviet Union and its client states. As long as these flourished, then planning enjoyed great prestige and was, for example, copied by postcolonial states such as India. The decline and fall of the USSR totally discredited planning and helped to legitimise neo-liberalism. The reigning economic orthodoxy systematically conceals the extent to which some of the most successful economies in the contemporary world � China and South Korea � have depended on state intervention.

The reaction against planning has meant that even those seeking to develop alternatives to capitalism as such have seen some kind of market economy as inescapable. This is most obviously true of the market socialism advocated, for example, by the philosopher David Miller and the economist John Roemer. Here collectively owned cooperatives compete to sell their products on the market. Even the Marxist philosopher Tony Smith, in his new book Globalisation: a Systematic Marxian Account, argues that it would be possible to democratise the market.

The fundamental problem with this kind of strategy is that it is a necessary feature of any market economy that it is based on competition. To put it a bit more technically, in a market economy the allocation of resources is the unintended outcome of competition between the firms that jointly but not collectively control the economy. In other words, each firm's share of resources depends on how successful it is in selling its goods or services on the market. There is no collective decision by society at large about how resources are shared out. And if a firm fails to compete, then it loses its share of resources � it goes bankrupt. So the individual units of a market economy tend to be under systematic pressure to cut their costs of production and thereby reduce the prices of their products in order to stay competitive.

By definition, this setup can't be organised democratically at the level of the economy as a whole, because there are no collective decisions about the allocation of resources, democratic or otherwise. But it's also very hard to sustain democratic organisation within the individual firm as well. Michael Albert of ZNet explains this very well. Let's imagine, he suggests, a worker-controlled enterprise that is organised on a democratic and egalitarian basis but that is failing to sell its products. What will the workers do?

In this context, assuming that they reject bankruptcy, they have two broad choices. They can opt to reduce their own wages, worsen their own work conditions, and speed up their own levels of work, which is a very alienating approach that they are not very emotionally or psychologically equipped to undertake. Or, they can hire managers to carry out these cost-cutting and output enlarging policies while at the same time insulating the managers from feeling the policies' adverse effects. In practice, very predictably, the latter is what occurs. Markets therefore have a built-in pressure to organise a workforce into two groups � a large majority that obeys and a small minority that makes decisions, with the latter enjoying greater income, power, and protection from the adverse effects of the cost-cutting decisions they will impose on others.

The logic of a market economy therefore tends to undermine and eventually to overwhelm any islands of democracy and equality that may emerge within it. This means that socialists such as Roemer and Smith, who believe that it is possible to democratise the market, tend to face a dilemma of their own. Either they impose all sorts of restrictions on the functioning of the market to prevent it from eroding democracy, in which case any economy based on the principles they propose is likely to break down because they prevent the logic of competition from operating properly, or, if they try to ensure this logic will operate, it will destroy the socialist ideals they are trying to realise.

The implication is that any sustainable alternative to neo-liberalism has to be based, not on the market, but on democratic planning. There are some models of how this could work. One is Albert's Parecon, or participatory economics. This involves an economy of workers' and consumers' councils in which individuals and enterprises submit proposals for their share of society's resources. Then a process of gradual adjustments (Albert calls them "iteration") takes place while technical experts come up with a plan that would give everyone as much as possible of what they want.

The main weakness of this model is that it mimics a bit too closely the workings of a market economy, in which claims on resources are driven by individual demands. Albert is an anarchist, and his commitment to decentralisation here goes too far. The allocation of society's resources isn't a neutral technical issue. It's a political question that requires some sort of collective and democratic decision-making process to choose between what would often be competing views of the priorities of the society in question.

From this perspective, the British left wing economist Pat Devine offers a superior model of what he calls negotiated coordination. Here the allocation of resources is largely the outcome of discussion between producers, consumers, and other affected groups, but within the framework of overall decisions about economic priorities made democratically at the national and international level.

Plainly there is much more to be said � and, above all, to be done � about democratic planning. All the same, the importance of the kind of work being done by Albert, Devine, and others is that they begin to break down the prejudice against planning and to sketch out how an economy that rejected the market could manage to be both democratic and efficient.

Fighting for power

But any break with capitalism couldn't take the form of an instantaneous leap into a fully planned economy. Marx long ago argued in the Critique of the Gotha Programme that a new workers' state would inherit a society deeply marked by capitalism. Initially, it would have to make compromises with the old order, and gradually move towards a society governed by the communist principle "From each according to their ability, to each according to their needs!"

Similarly today a society breaking with capitalism would need to make a decisive shift towards an economy in which priorities were decided democratically rather than left to the anarchy of competition. This would critically involve taking control of the financial markets, nationalising under workers' control key sectors of the economy, and extending social provision on the basis of a progressive tax system that distributed wealth and income from rich to poor.

These measures, radical though they are, would still leave in place many aspects of a market economy. Large sectors would remain in private hands. Continuous pressure and the introduction of new measures would be necessary to move the economy as a whole towards the principles of democratic planning. One key step would be to weaken the power of the capitalist labour market, which today rules our lives.

In my view, the best way to do this would be to introduce universal direct income. In other words, every resident of the country would receive, as of right, an income that met their basic needs at a relatively low but nevertheless decent level. This would serve two goals. First, it would ensure a basic level of welfare for everyone much more efficiently than existing systems of social provision � people with greater needs because they had children or were disabled or whatever would receive a higher basic income.

Secondly, having a guaranteed basic income would greatly reduce the pressure on people to accept whatever job was on offer on the labour market. One of the main presuppositions of capitalism � that workers have no acceptable alternative to wage labour � would be removed. The balance of power between labour and capital would shift towards the workers, irrespective of the nature of their employer.

More broadly, the question of power is crucial. One obvious challenge to the kind of vision of change I have just sketched out is how to ensure that the direction of change would be towards a democratically planned economy rather than back to market capitalism or maybe to the kind of state capitalism that ended up dominating the Soviet Union. The only guarantee that counts is that levers of political power are in the hands of the workers themselves.

As long as the state takes the form that it does today � a bureaucratically organised, hierarchical set of apparatuses whose managers' interests are bound up with those of capital � any improvement in society can only be temporary and fragile. This is why the strategy of ignoring the state advocated by Holloway and others is so foolish. If we are to move towards a democratically planned economy, then the existing state has to be confronted and broken.

This task can only be achieved through the development of a different kind of power, one based on the self-organisation of workers and other poor people which develops out of their struggles against capital. The great revolutionary movements of the 20th century offered some glimpses of this power � from the workers' and soldiers' councils of the Russian Revolution of October 1917 to the workers' shoras during the Iranian Revolution of 1978-9. The self-organisation displayed by the Bolivian popular movement during the insurrections of October 2003 and May-June 2005 showed that the contemporary movements against neo-liberalism can generate this kind of power as well.

A democratically planned economy would be a self-managing society, one in which directly elected workplace and neighbourhood councils took responsibility for their own affairs and linked together to make decisions for society at large. The key insight that Marx had during the Paris Commune of 1871 was that these forms of organisation would develop before the new society was created, in the process of fighting the old society. The same methods of self-organisation that would be the basis of a self-managing society are needed by the exploited and oppressed to resist and, ultimately, to overthrow capital itself.

The overthrow of capital is itself a process. The dilemma that Albert imagines confronting a workers' cooperative in a market economy would face any society that was beginning to introduce the principles of democratic planning in a world still ruled by capitalism. This same dilemma was responsible for the corruption and eventual destruction of the Russian Revolution of October 1917. Any breakthrough in one part of the world could only survive by spreading and progressively overturning the logic of capital on a global scale.

This may sound like a tall order, but the globalisation of capital has produced a globalisation of resistance. Struggles in different parts of the world contaminate each other. Chiapas and Seattle had global reverberations. The great struggle against the CPE in France has helped to inspire a student movement in Greece that has just defeated the right-wing government. The movements in Latin America have become a beacon to all those fighting neo-liberalism.

We are still a long way from overturning capitalism even in one country. But the worldwide resistance to the unrestrained market isn't simply putting back on the agenda the idea of an alternative to capitalism. It is also helping to create the conditions in which that alternative can win.


Alex Callinicos is a leading member of the Socialist Workers Party and Professor of European Studies at King's College London


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[Oct 25, 2014] Vladimir Putin blames US for Islamist terrorism and Ukraine conflict Shaun Walker

From comments: IlicPetar 25 October 2014 2:28pm
However, when one British newspaper reporter asked him specifically about the repeated reports of Russian army troops operating in east Ukraine, Putin chose to ignore the question completely.
Our friend Shaun, after a pleasant conversation with Ukrainians "who refused to give his name", informs us now on unnamed journalists who ask tough questions to Putin. So probably this is about The Guardian journalist Seumas Milne. He actually asked to Putin two questions, after which Putin asked him to clarify his second question. In this sense, it turns out that Putin really avoid answering the first question. But, in the previous question, the Russian troops were not mentioned at all. However, it is better to read it yourself...
theguardian.com

Puutin said that over the past two decades, the US had behaved as if it were someone "nouveau riche who had suddenly received a lot of wealth – in this case, global leadership". Instead of using its powers wisely, said Putin, the US had created a unilateral and unfair system.

The Russian president's sentiments were nothing new, but appeared to be a more concise and concentrated version of his grievances at a time when relations between Russia and the west are more strained than at any period since the cold war.

In a terse opening statement before taking questions for nearly three hours, Putin said: "The exceptionalism of the United States, the way they implement their leadership, is it really a benefit? And their worldwide intervention brings peace and stability, progress and peak of democracy? Maybe we should relax and enjoy this splendour? No!"

Beginner20 , 24 October 2014 7:08pm
Not only. Putin directly said: the US is NOT democracy and never was. Whole speech is here.
BillGoatse -> hiiipower , 24 October 2014 9:05pm
In regards to Islamic terrorism I agree. How many potential terrorists has the USA created by starting a war which has killed over half a million people?! How can they fight a 'war on terror' by bringing terror to millions of innocent people? It's all so illogical and tragic and there seems to be no end to this killing.

It seems obvious that America isn't killing so many civilians in the middle east for the good of the middle east civilians. They have been planning this for years. This video is a much watch! It has a former four star general and supreme commander of NATO explaining America planned to invade 7 countries. Why this video isn't more widely seen is a travesty.

General Wesley Clark: Wars Were Planned - Seven C…: http://youtu.be/9RC1Mepk_Sw

nobledonkey , 24 October 2014 7:31pm
George Soros wants war with Russia and he wants the EU to help pay for it by way of inflation via the printing press i.e. further destroying the middle classes.

http://www.nybooks.com/articles/archives/2014/nov/20/wake-up-europe/?insrc=hpss

Europeans:

Are you ready to confront Russia in the name of Soros' billions?

The man has already invested quite a bit in shady NGOs like Open Society and the man was knee-deep in the theft and plundering of Russia during the 1990s by way of Renaissance Capital and other financial outfits.

How soon before Soros teams up with Khodorkovsky and his "Open Russia" NGO? Khodorkovsky wants to get back what he rightfully stole so that he can placate former business partners like Dick Cheney.

nobledonkey -> Alderbaran, 24 October 2014 9:05pm

Nobody wants war with Russia and to suggest that Khodorkovsky is driven by a desire to placate Cheney seems ludicrous.

The point I was illustrating is that Soros wants the EU to become more confrontational with Russia, at the expense of its own security and economic well-being, the latter of which would actually help his own financial interests.

The second point is that Khodorkovsky and Cheney were business partners in the past and that much of the opposition to Putin by men such as Khodorkovsky, Berezovsky, Kasparov, and Zakayev is closely linked not only to financial players like Soros but to the neo-conservatives as well; whose media figures have been the most hawkish re: Russia and not just since Ukraine blew up (again).

Yucos was comprehensively stolen from him under the direction of perhaps Russia's second most influential man - Sechen. This was at a time when Putin wanted to prevent Khordorkovsky moving into politics and Igor Sechen had an eye on the potential spoils of Yucos. Khordorkovsky has expressed a desire to see Russia become a successful democracy.

That's why I said that "Khodorkovsky wants back what he stole in the first place".

The idea that he wants Russia to be a successful democracy is laughable, especially in light of his treatment of employees during his heyday, in particular when he had police beat striking workers.

All these figures: American neo-conservatives, western finance, and Russian 'opposition' are bound in their desire to re-open Russia like the Yeltsin days so that it be plundered once again, for varying reasons ranging from personal power to the extension of American hegemonic ambitions.

jamesoverseas , 24 October 2014 7:56pm
You missed this nugget that explains his world view

The world works like this: the more loyalty you have to the single centre of power in the world, the more legitimate your govt is

. To be fair has has a point. Syrian government not legitimate but Bahrain and Saudi governments are...can anyone explain the difference to me? (other than the syrian regime is more secular and protective towards minorities than the other two)
SEARAY , 24 October 2014 7:57pm

Putin might be right. Things were not so bad in Ukraine until EU was reportedly "fucked" by Victoria Nuland.

Beckow, 24 October 2014 8:01pm
What would Ukraine be like today without US-EU support for the violent revolution/coup in February in Kiev?

- There would be by now a normal presidential election with a new government (Ukraine for all its faults had a democracy and Yanukovitch and before him pro-Western Yushenko were elected)
- There would be no war in the Russian-speaking east and south
- Crimea would be safely in Ukraine
- Gas imports and trade with Russia would go on as before accounting for 30% of Ukraine's trade

Instead, Ukraine has a "revolutionary" government with all kinds of street radicals and pro-Western oligarchs running around saying some of the more stupid things in recent memory (US is going to give Marshall Plan, EU is going to open its borders to Ukrainian migrants, Russia has used nuclear missiles in Ukraine, etc...

The economy is dropping almost 10% a year with the worst still coming. There are 3,000 dead and the blood-thirsty rhetoric is still escalating.

Yes, this is a result of US meddling and support for the Maidan street protests. This is a result of 5 billion dollars spent by US on "NGO's" in Kiev. This is a result of Nuland's cookies.

Seems to me that it is self-evident that US has supported Ukraine's revolution. It is also self-evident that it has been a failure and Ukraine will suffer for a very long time. But since Putin said it, I am sure many will scream and shout and demonize instead of rational thinking. Quite a spectacle we see among Western intellectuals.... Were you always like this? Or is it something about Russia that drives you incoherent with rage?

JCBKing -> Beckow , 24 October 2014 8:07pm
The Ukrainians would also have 15 billion extra. It is not as if the deal with Russia would have left some of the idiots in Ukraine without any further scope for leverage between the EU and Russia.

I'm not sure if the EU will open up it's doors or conjure up some scheme that makes it more possible for a higher number of Ukrainians to at least be able to work in Poland, the supposedly "prosperous" Baltic states or Hungary.

Beckow -> JCBKing , 24 October 2014 8:20pm

EU is not exactly suffering from labor shortages today. So more Ukrainian workers, in Poland or anywhere, would just lead to even worse labor market for everybody. Actually, Russia is suffering from labor shortage, there are 3 million Ukrainians working there already.

In any negotiation one loses power and leverage by emotionally preferring one side. Ukraine has lost any leverage over EU by so visibly "loving EU", or US (who get anything they want anyway), or Russia by showing undisguised hatred - when Ukrainian leaders make Russo-phobic speeches (Yatsenyuk) and then remain as Ukrainian leaders, well that reflects on all Ukrainians.

So today, Ukraine has no room to negotiate anything. They are left with pleading for mercy and charity. That has never led to anything good.

Alderbaran -> Beckow, 24 October 2014 8:20pm
The attempted takeover of eastern Ukraine has been way more violent and damaging than any of the protests in Kiev and I don't see how you can contest that.

Ukraine is a corrupt state but to imagine that this corruption would have gone away naturally following another election is naive. Generally I ignore posts that mention Nuland, Nazis and $5 billion but I feel compelled to disagree with you.

Months ago, many were comparing Putin's moves in Ukraine to a chess game being played masterfully. Now, many of the same voices are saying that Russia had no influence in Ukraine and that any problems there are the fault of the US.

The chess game analogy might be quite apt - Putin appears to see conflict as adversarial rather than a drive to find equilibrium and compromise. The drive to capture Crimea might have also been made in order to divert attention away from problems in Russia itself and I'm worried that he might become ever more paranoid as Russia's economy slips and that speeches such as this one might become a little more common.

creel , 24 October 2014 8:03pm
Putin makes a general observation that is well grounded. Over the past two decades, yes. In his ex Soviet backyard. Yet if one thinks back further the US has often acted thus - through her proxy allies such as Turkey, Israel; through a host of coup-empowered autocrats the likes of Iraq's Saddam Hussein and Chile's Pinochet and through support for failed insurrection in Cuba, Nicaragua and indeed, after a long period of misrule, in Iran.

Why do we so easily overlook Turkey's incursion into Cyprus and her continued support for militarized ethnic enclaves ..but pillory Russia for her support for similar dissident pro-Russian populations in Ukraine? Particularly when in Russia's case, there are sound strategic reasons for her apprehension about the way a potentially hostile linked-with-Nato military alliance has openly seized opportunity to place forces ever-closer to her heartland.

Umut Gezer , 24 October 2014 8:03pm

I still believe Russia should have invaded Ukraine after Yanukovich who was elected by the popular vote was ousted by a western backed coup. Perhaps this was what the Nato planned so Russia would be sucked into a war, but it did not work. their plans all have been dumped into the bin.

also, on the point of Putin ignoring one British paper's question; the British media has been lying for a year on the Ukraine issue. It has been publishing bias news and has been a dark page in journalism.

katafonia , 24 October 2014 8:07pm
as Orwell said "In a time of universal deceit - telling the truth is a revolutionary act."
the Russian Hercules made a great speech!
shakur_420 , 24 October 2014 8:12pm
Anyone familiar with the context and history of NATO expansion, and the facts surrounding the US-sponsored coup in Ukraine, knows full well that the Russians have shown tremendous restraint. It has been the US who has been aggressive (along with their pathetic allies, like my country) in Ukraine, as they have been on the global stage for more than half a century.

The Guardian's dismissal of the facts, and their downplaying of US government behaviour is nothing new.

SHappens , 24 October 2014 8:15pm
Putin once again delivered an outstanding speech. He speaks the truth, in a straightforward manner, there is no malice nor hate. Just a fair understanding of the present situation and a clear view on Russia's future aspirations. Putin loves his country and his people rewards him a hundredfold.

There is a lot of food for thoughts in his speech.

We have entered a period of differing interpretations and deliberate silences in world politics. International law has been forced to retreat over and over by the onslaught of legal nihilism. Objectivity and justice have been sacrificed on the altar of political expediency. Arbitrary interpretations and biased assessments have replaced legal norms. At the same time, total control of the global mass media has made it possible when desired to portray white as black and black as white.

JCBKing , 24 October 2014 8:19pm
Caught some of it. Brilliant stuff from a highly intelligent and decent man.

It is incredible though some of the dumb questions these morons in the US and UK press ask. Not all of them but many..it defies logic. One overemotional American woman asked a stupid series of questions of pointless rhetoric that leave no scope for decent answers. The Financial Times man even worse ( a misleading question with the answer obvious) with imbecilic rudeness and fake posturing over the "accuracy" of one his reporters latest propaganda pieces .Completely out of place to mention in a meeting like this with a head of state.

I also would have liked some question from any nationality on why the US,Russia and Ukraine are all involved in obfuscation of the MH17 crash. One would assume that all 3 parties know exactly what happened from where and when and it would have been good for the President to be cornered on this,even though a direct answer would have been unlikely to have been given...everything else though was answered as usual with a great degree of detail that shames the empty headed, 15 minutes at best, nonsense from the likes of Obama and Cameron.

zelazny , 24 October 2014 8:20pm
Putin stands head and shoulders above the various western leaders, from the Pillsbury Doughboy Cameron to the "constitutional scholar" Obama.

Only the blind and the stupid don't understand that the US staged a neo-Nazi coup in Ukraine. The neo-Nazis then went on a campaign of slaughtering civilians, even burning them alive. The people in the eastern Ukraine said no to this psychopathy, and they in essence have won. The Kiev government trembles because it knows now that neither Nato nor the USA would come to their aid should Russia really attack them.

And a not so subtle threat underlies Putin's speech, because he basically has said Russia has had enough with US criminality. I think this foreshadows the eventually break from the petro-dollar by the BRICs, protected by Russia nuclear arms.

The federal reserve has to print out money by the untold billions in order to keep the US economy from another crash. Behind the facade of the increases in stock prices hides a cowering economy ready to crash at any unexpected event.

lubostron, 24 October 2014 8:28pm

...And he's bloody right!

It's beyond tragi-comic belief the amount of psychophantic scaremongering, lies, half-truths and propaganda America, Britain and others use to demonise Russia.

Luckily, there seems to be a huge disconnect between what is told/reported by governments and official (corporate) media and what many, many people actually believe.

JJRichardson lubostron , 24 October 2014 8:30pm
And have you looked at RT? It makes Soviet propaganda look sophisticated.
Nickel07 -> JJRichardson , 24 October 2014 8:38pm
I have looked at RT and I can assure you that some of the reporting is less biased than this pamphlet we are currently commenting on.

AlekNevski, 24 October 2014 8:36pm

The Russian president "has won because we were not ready to die for Ukraine, while apparently he was," Ambassador Gerard Araud said yesterday at a Bloomberg Government breakfast in Washington.

http://www.bloomberg.com/news/2014-10-22/-poker-player-putin-bluffed-and-won-french-envoy-says.html

Donetsk is 300 miles from Volgograd (Stalingrad) where 1 million (1 million?) German soldiers died in the legendary battle. Nearly 2 million Russian died too.
And these stupid bureaucrats are surprised that the Russians are willing to fight for... their land?

This level of incompetence is hard to bear. Moronic, completely and utterly moronic.

olddocrob, 24 October 2014 8:41pm

Was once told that the purpose of education was to equip one with a 100% efficient bullshit detector. There are a lot of sad, trusting folk on the site tonight; one would think uncle Jo, Adolph and their like had never trod the earth. How can anyone take seriously a man who parades half naked in front of his people looking like some extra from a homoerotic sword and saddles bash? I 'll take Putin seriously when he stops banging up journos and the singers of mildly ironic songs. Until then he's damaged goods.

donald7063 , 24 October 2014 8:47pm
Is Russia a colony of the US?

This is the opening paragraph of the National Liberation Movement of Russia's manifesto which is for the removal of unfriendly domination by the US of its economic, governmental and constitutional arrangements. For the complete manifesto go to:

www.geopolitica.ru

The National Liberation Movement in Russia has only one goal that unites everyone regardless of their political views: the restoration of the sovereignty of the country and liberation from its occupiers. The inhabitants of Russia must break free from their chains of slavery and become free citizens in a free (non-occupied) country.

To achieve these goals, the government should become ours, i.e. we must completely change the nature of the state, including through amending the Constitution. Society is a broader concept, and in fact, it should feel necessary to partake in this goal because the national liberation struggle is a struggle of the society for the restoration of sovereign control over Russia, including control over state institutions. Today, the state in Russia, as in any colony, works for the occupier under the rules established by it, placing it under the rulers' direct control. This provision is captured in the existing Constitution. Every day the main task of those millions of officials who go to work is to improve living standards and the solve the problems of the American and European peoples. That is their main function today. At the level of daily activity, it is hard to recognize this without desire and sufficient time for the conceptualisation of our historical facts and the current state of affairs in the country as a whole.

Justavoice01 , 24 October 2014 9:04pm

Since WWII, America has had plenty of wars, Committed plenty of war crimes, destabilized plenty of countries all over the world, not all for good, but for self-interest. Yet If Putin says this, it is labelled as propaganda, But it is true. America causes trouble everywhere it goes, if they don't get their way, the so called "west" defends any old stupidity they come out with. Creating chaos then try to manage it, but time and time again, it is botched up. Always defended by "compliant allies" who follows America with their follies all over the world. America has an army that don't win wars, it has too much money that is back by, god only knows, it's governance is irrational and dysfunctional, a country who votes in the dumbest individuals into positions of power and then try to dictate. I have said this plenty of time on these pages, Why do we follow them!......If the answer is WWII, the USSR won the European theatre practically by themselves.

Justthefactsman , 24 October 2014 9:06pm
I listened and watched on RT.

"When the British reporter asked about Russian troops operating in the Ukraine, Putin did reply according to the English translation to which I was listening. he even admitted that Russian troops were used to prevent Ukranian troops from leaving there base.

Maybe Shaun Walker should have gone to Sochi, or perhaps have watched RT.
As to describe Putin as railing against the U.S.A I wonder if Shaun actually knows the definition of railing ?

This whole piece is just another stick to beat the bear with.

I am not fan of Putin but then I am no fan of Obama, but can Shaun really tell us where Putin Lied about the historical past and what the recent history has been about the Ukraine?

I think Shaun should read "A Peoples Tragedy" by Orlando Fuges

johhnybgood , 24 October 2014 9:08pm
As Sergei Lavrov said to the US "we are sorry our country is so close to your bases". Lavrov's recent UN speech is a masterclass in diplomatic rhetoric. He is a million miles ahead of any US spokesperson - they are all incapable of any sort of sensible dialogue. Is anyone now listening to the constant Russophobia from the MSM.? Look what is actually happening on the ground, not what the press is reporting. It is clear that Russia has been a model of self restraint in the face of many provocations. The West has only succeeded in driving Russia closer to China.
RememberGiap , 24 October 2014 9:10pm
And Putin is right . Putin's Russia does not send drones to kill on other continents . Putin's Russian did not cause chaos in Libya , Iraq and Afghanistan . Putin's Russia did not spend billions of dollars creating fundamentalist Islamic movements on the Pakistani / Afghan border in the 1980's . Putin's Russia did not invite and fund Arab Jihadists to wage war as proxies of Russia as did the USA , a price we all suffering now . Russia does not supply arms to Israel to bomb Palestinians . Russia does not give Israel its ' veto ' on the UN Security Council to give it immunity from International law . Russia does not station its military bases throughout the world . As for US activities in toppling Governments , destabilizing countries and covert operations in Southern and Central America I'd still be typing this post tomorrow without even then revealing the tip of the iceberg !!

The USA , lovely people unfortunately living in a global Rogue State .

seamuspadraig , 24 October 2014 9:12pm
Uncle Scam is in deep doggie-do now. Russia and China aren't just some little third-world countries that Washington can wipe its ass on then throw away. Oh no... Uncle Scam is after big game now! These two animals can defend themselves. And this time, they're on the same team.

I'm waiting to see what happens in Syria.

Corrections , 24 October 2014 9:13pm
Partial English transcript:
http://eng.kremlin.ru/transcripts/23137

The rest of the transcript will no doubt appear over the next several hours. I suppose it's better than waiting until the whole thing is translated before posting anything.

EugeneGur , 24 October 2014 9:33pm
Putin said nothing in this speech that wasn't patently obvious. There is really nothing that could reasonably be denied because most statements were pure statement of facts. He just said all this very bluntly. He started his speech by saying that he was going to speak him mind, otherwise he sees no reason to speak at all.

I am old enough to remember as in early 1990s the American press cried every day all the time "We won! We won! We are the sole remaining superpower!" I thought: Aren't we supposed to be all friends now? As it became clear very soon, no, we weren't. We were expected to be servants to "indispensable" American people destined to rule the Universe. I can't speak for the rest of the Universe, but that role somehow doesn't appeal to me.

The exceptionalism of the United States, the way they implement their leadership, is it really a benefit? And their worldwide intervention brings peace and stability, progress and peak of democracy? Maybe we should relax and enjoy this splendour? No!"

This is a mistranslation. Puting didn't say anything about splendor. He did say "relax and enjoy" but he was referring to the saying" What should you do when you are being raped? Relax and try to enjoy". A somewhat different meaning, isn't it?

[Oct 24, 2014] Putin Says Don't Mess With Mother Russia By Marc Champion

Putin forgot the neoliberalism means the law of jungles. See Henry_Giroux article above
Oct 24, 2014 | Bloomberg

If President Vladimir Putin is Russia, as a senior Kremlin official said this week, then this country is angry, humiliated and suffering from an almost paranoid fixation on the U.S. as the root of all the world's troubles.

In a closing speech and question-and-answer session today at Russia's annual state-sponsored Valdai conference, Putin said he was going to be frank -- he was more than that. He dived into a long list of slights and wounds inflicted by the U.S. on Russia and the world since the end of the Cold War, and gave every sign of digging in for a long period of confrontation.

The U.S., according to Putin, is a global Big Brother that blackmails and bullies its allies while producing instability and misery around the world. Because the U.S. realizes it no longer has the ability to succeed as the lone hegemon in an age of rising powers, it is trying to recoup that status by re-creating the Cold War and producing a new enemy against which to rally countries, he said.

According to Putin's tour of contemporary world history, aggressive U.S. interventionism is responsible not just for the destabilization of Iraq (which it was) and Libya, but also for Syria (where the U.S. didn't intervene against President Bashar al-Assad) and the creation of al-Qaeda, the Taliban and Islamic State. And that's before you get to the Maidan protests and "state coup" this year in Ukraine.

As for the economic sanctions the European Union has imposed over Russia's annexation of Crimea and destabilization of Ukraine, that again was all because of pressure from the U.S., he said -- not any action Russia might have taken.

There is plenty of truth salted through Putin's complaints, enough to make him -- as one fawning Russian state TV anchor put it in what passed for a question -- "the face of resistance" for many around the world.

What is worrying is that the post 1990s narrative Putin laid out -- in which the U.S. has ignored, humiliated, encircled and isolated Russia since the collapse of the Soviet Union -- is one most Russians whole-heartedly believe. They, too, can't imagine that ordinary unarmed citizens -- whether in Kiev, the Arab Spring countries or elsewhere -- might act of their own volition, rather than as pawns in a U.S. game.

"What's in his mind is what Russia is thinking. It's like you're mad at someone and just let it out," said Toby Gati, a former U.S. diplomat in the audience. Gati had told Putin she didn't recognize the U.S. he described, drawing a rare conciliatory comment that he wasn't seeking confrontation.

The wellspring of popular support Putin enjoys for any potential escalation, as unwise as that would be for Russia's long-term prosperity, allowed him to be defiant on sanctions and fatalistic on continued bloodshed in Ukraine.

Sure, Putin called for a new rule-based world order and insisted that his country had no ambitions to re-create the old empire. And no doubt he was talking, on state TV, in part to the home audience. Yet the broad thrust of his remarks was defiant, arguing that if the U.S. gets to throw its weight around and break rules, why shouldn't Russia? "What's allowed for Jupiter isn't for the bull," Putin said. "Well, the bull may not be able to, but the bear isn't going to ask anyone's permission."

There's plenty of blame to go around for allowing the situation to get this bad, but for anyone who wants to see the Ukraine crisis solved, sanctions lifted and a repaired relationship between Russia and the U.S. and EU, this was a dark and depressing performance that came close to a threat.

[Oct 24, 2014] Russia's Putin blames U.S. for destabilizing world order

It not so depressing the level of WashPost reaction, as the level of comments...
The Washington Post

Russian President Vladimir Putin accused the United States on Friday of endangering the international order by trying to "remake the whole world" for its own, exclusive interests, and he predicted that Ukraine would not be the last conflict to embroil the major powers.

Putin charged that the United States has escalated world conflicts by "unilateral diktat" and by imposing sanctions that he said were aimed at pushing Russia toward "economic weakness," while he denied that Russia aspires to rebuild an empire or reclaim its Cold War-era stature as a superpower.

"We did not start this," Putin said of the worsening world climate. "These policies started a few years ago; it hasn't just started today because of sanctions."

The Russian president's comments, among the most incendiary he has ever directed against the United States, were made during a speech before the Valdai Club, an annual gathering of international analysts and scholars held this year in the southern Russian city of Sochi, where Russia staged the Winter Olympic Games earlier this year.

Since then, Russia's annexation of Crimea and involvement in the conflict in eastern Ukraine have driven relations between Moscow and Washington to their lowest point since the end of the Cold War.

Putin said the United States had adopted a Cold War victor's mindset that was clouding its view of the world, leading to "serious delusions" about what changes are needed in the international system.

"It never ceases to amaze me how our partners have been guilty of making the same mistakes time and again," Putin said. He said past U.S. support for Islamist extremists had helped to create the current crises in Iraq and Syria, and he charged that U.S. backing for revolutions in former Soviet states now contending with chaos - such as Ukraine - were tantamount to "letting the genie out of the bottle."

magnifco1000

Trust me, if Putin weren't there, Russia would splinter into a dozen nations with half of them "Islamic States." They'd make ISIL look tame by comparison. Our interests are currently served with Russia under central control and with leadership that hate the Islamists as much as we do.

magnifco1000

The US approach to Russia is totally idiotic and unproductive. I'm a businessman and know Russia. These "Russian scholars" from Ivy League schools know nothing. Left over neocons from the Cold War just make things worse.

Russia should be engaged and worked with. We missed a golden opportunity when the Cold War ended. We don't have to feel afraid of Russia. It just has a conscript army and can barely hold it's territory together.

What's the sense of kicking them when they are down.

Giantsmax

from my own objective point of view, it is hard to argue with Putin, I think what he says bears a lot of truth.

Archy Bunka

It is hard to argue with Putin, because if you are a Russian citizen he will lock you up.

Giantsmax

But since I am an American citizen that is a moot point.

Beau7890

Of course the U.S. is trying to remake the whole world for its own interests. It's been doing this since the early 20th century. So has Russia. So has every other country that tries to lead the world-it's always for their own interests.

Putin speech at the meeting of the Valdai International Discussion Club

Does this mean that Putin feels that neoliberalism is dead? What if he is wrong ?

... ... ...

Today's discussion took place under the theme: New Rules or a Game without Rules. I think that this formula accurately describes the historic turning point we have reached today and the choice we all face. There is nothing new of course in the idea that the world is changing very fast. I know this is something you have spoken about at the discussions today. It is certainly hard not to notice the dramatic transformations in global politics and the economy, public life, and in industry, information and social technologies.

Let me ask you right now to forgive me if I end up repeating what some of the discussion's participants have already said. It's practically impossible to avoid. You have already held detailed discussions, but I will set out my point of view. It will coincide with other participants' views on some points and differ on others.

As we analyse today's situation, let us not forget history's lessons. First of all, changes in the world order – and what we are seeing today are events on this scale – have usually been accompanied by if not global war and conflict, then by chains of intensive local-level conflicts. Second, global politics is above all about economic leadership, issues of war and peace, and the humanitarian dimension, including human rights.

The world is full of contradictions today. We need to be frank in asking each other if we have a reliable safety net in place. Sadly, there is no guarantee and no certainty that the current system of global and regional security is able to protect us from upheavals. This system has become seriously weakened, fragmented and deformed. The international and regional political, economic, and cultural cooperation organisations are also going through difficult times.

Yes, many of the mechanisms we have for ensuring the world order were created quite a long time ago now, including and above all in the period immediately following World War II. Let me stress that the solidity of the system created back then rested not only on the balance of power and the rights of the victor countries, but on the fact that this system's 'founding fathers' had respect for each other, did not try to put the squeeze on others, but attempted to reach agreements.

The main thing is that this system needs to develop, and despite its various shortcomings, needs to at least be capable of keeping the world's current problems within certain limits and regulating the intensity of the natural competition between countries.

It is my conviction that we could not take this mechanism of checks and balances that we built over the last decades, sometimes with such effort and difficulty, and simply tear it apart without building anything in its place. Otherwise we would be left with no instruments other than brute force.

What we needed to do was to carry out a rational reconstruction and adapt it the new realities in the system of international relations.

But the United States, having declared itself the winner of the Cold War, saw no need for this. Instead of establishing a new balance of power, essential for maintaining order and stability, they took steps that threw the system into sharp and deep imbalance.

The Cold War ended, but it did not end with the signing of a peace treaty with clear and transparent agreements on respecting existing rules or creating new rules and standards. This created the impression that the so-called 'victors' in the Cold War had decided to pressure events and reshape the world to suit their own needs and interests. If the existing system of international relations, international law and the checks and balances in place got in the way of these aims, this system was declared worthless, outdated and in need of immediate demolition.

Pardon the analogy, but this is the way nouveaux riches behave when they suddenly end up with a great fortune, in this case, in the shape of world leadership and domination. Instead of managing their wealth wisely, for their own benefit too of course, I think they have committed many follies.

We have entered a period of differing interpretations and deliberate silences in world politics. International law has been forced to retreat over and over by the onslaught of legal nihilism. Objectivity and justice have been sacrificed on the altar of political expediency. Arbitrary interpretations and biased assessments have replaced legal norms. At the same time, total control of the global mass media has made it possible when desired to portray white as black and black as white.

In a situation where you had domination by one country and its allies, or its satellites rather, the search for global solutions often turned into an attempt to impose their own universal recipes. This group's ambitions grew so big that they started presenting the policies they put together in their corridors of power as the view of the entire international community. But this is not the case.

The very notion of 'national sovereignty' became a relative value for most countries. In essence, what was being proposed was the formula: the greater the loyalty towards the world's sole power centre, the greater this or that ruling regime's legitimacy.

We will have a free discussion afterwards and I will be happy to answer your questions and would also like to use my right to ask you questions. Let someone try to disprove the arguments that I just set out during the upcoming discussion.

The measures taken against those who refuse to submit are well-known and have been tried and tested many times. They include use of force, economic and propaganda pressure, meddling in domestic affairs, and appeals to a kind of 'supra-legal' legitimacy when they need to justify illegal intervention in this or that conflict or toppling inconvenient regimes. Of late, we have increasing evidence too that outright blackmail has been used with regard to a number of leaders. It is not for nothing that 'big brother' is spending billions of dollars on keeping the whole world, including its own closest allies, under surveillance.

Let's ask ourselves, how comfortable are we with this, how safe are we, how happy living in this world, and how fair and rational has it become? Maybe, we have no real reasons to worry, argue and ask awkward questions? Maybe the United States' exceptional position and the way they are carrying out their leadership really is a blessing for us all, and their meddling in events all around the world is bringing peace, prosperity, progress, growth and democracy, and we should maybe just relax and enjoy it all?

Let me say that this is not the case, absolutely not the case.

A unilateral diktat and imposing one's own models produces the opposite result. Instead of settling conflicts it leads to their escalation, instead of sovereign and stable states we see the growing spread of chaos, and instead of democracy there is support for a very dubious public ranging from open neo-fascists to Islamic radicals.

Why do they support such people? They do this because they decide to use them as instruments along the way in achieving their goals but then burn their fingers and recoil. I never cease to be amazed by the way that our partners just keep stepping on the same rake, as we say here in Russia, that is to say, make the same mistake over and over.

They once sponsored Islamic extremist movements to fight the Soviet Union. Those groups got their battle experience in Afghanistan and later gave birth to the Taliban and Al-Qaeda. The West if not supported, at least closed its eyes, and, I would say, gave information, political and financial support to international terrorists' invasion of Russia (we have not forgotten this) and the Central Asian region's countries. Only after horrific terrorist attacks were committed on US soil itself did the United States wake up to the common threat of terrorism. Let me remind you that we were the first country to support the American people back then, the first to react as friends and partners to the terrible tragedy of September 11.

During my conversations with American and European leaders, I always spoke of the need to fight terrorism together, as a challenge on a global scale. We cannot resign ourselves to and accept this threat, cannot cut it into separate pieces using double standards. Our partners expressed agreement, but a little time passed and we ended up back where we started. First there was the military operation in Iraq, then in Libya, which got pushed to the brink of falling apart. Why was Libya pushed into this situation? Today it is a country in danger of breaking apart and has become a training ground for terrorists.

Only the current Egyptian leadership's determination and wisdom saved this key Arab country from chaos and having extremists run rampant. In Syria, as in the past, the United States and its allies started directly financing and arming rebels and allowing them to fill their ranks with mercenaries from various countries. Let me ask where do these rebels get their money, arms and military specialists? Where does all this come from? How did the notorious ISIL manage to become such a powerful group, essentially a real armed force?

As for financing sources, today, the money is coming not just from drugs, production of which has increased not just by a few percentage points but many-fold, since the international coalition forces have been present in Afghanistan. You are aware of this. The terrorists are getting money from selling oil too. Oil is produced in territory controlled by the terrorists, who sell it at dumping prices, produce it and transport it. But someone buys this oil, resells it, and makes a profit from it, not thinking about the fact that they are thus financing terrorists who could come sooner or later to their own soil and sow destruction in their own countries.

Where do they get new recruits? In Iraq, after Saddam Hussein was toppled, the state's institutions, including the army, were left in ruins. We said back then, be very, very careful. You are driving people out into the street, and what will they do there? Don't forget (rightfully or not) that they were in the leadership of a large regional power, and what are you now turning them into?

What was the result? Tens of thousands of soldiers, officers and former Baath Party activists were turned out into the streets and today have joined the rebels' ranks. Perhaps this is what explains why the Islamic State group has turned out so effective? In military terms, it is acting very effectively and has some very professional people. Russia warned repeatedly about the dangers of unilateral military actions, intervening in sovereign states' affairs, and flirting with extremists and radicals. We insisted on having the groups fighting the central Syrian government, above all the Islamic State, included on the lists of terrorist organisations. But did we see any results? We appealed in vain.

We sometimes get the impression that our colleagues and friends are constantly fighting the consequences of their own policies, throw all their effort into addressing the risks they themselves have created, and pay an ever-greater price.

Colleagues, this period of unipolar domination has convincingly demonstrated that having only one power centre does not make global processes more manageable. On the contrary, this kind of unstable construction has shown its inability to fight the real threats such as regional conflicts, terrorism, drug trafficking, religious fanaticism, chauvinism and neo-Nazism. At the same time, it has opened the road wide for inflated national pride, manipulating public opinion and letting the strong bully and suppress the weak.

Essentially, the unipolar world is simply a means of justifying dictatorship over people and countries. The unipolar world turned out too uncomfortable, heavy and unmanageable a burden even for the self-proclaimed leader. Comments along this line were made here just before and I fully agree with this. This is why we see attempts at this new historic stage to recreate a semblance of a quasi-bipolar world as a convenient model for perpetuating American leadership. It does not matter who takes the place of the centre of evil in American propaganda, the USSR's old place as the main adversary. It could be Iran, as a country seeking to acquire nuclear technology, China, as the world's biggest economy, or Russia, as a nuclear superpower.

Today, we are seeing new efforts to fragment the world, draw new dividing lines, put together coalitions not built for something but directed against someone, anyone, create the image of an enemy as was the case during the Cold War years, and obtain the right to this leadership, or diktat if you wish. The situation was presented this way during the Cold War. We all understand this and know this. The United States always told its allies: "We have a common enemy, a terrible foe, the centre of evil, and we are defending you, our allies, from this foe, and so we have the right to order you around, force you to sacrifice your political and economic interests and pay your share of the costs for this collective defence, but we will be the ones in charge of it all of course." In short, we see today attempts in a new and changing world to reproduce the familiar models of global management, and all this so as to guarantee their [the US'] exceptional position and reap political and economic dividends.

But these attempts are increasingly divorced from reality and are in contradiction with the world's diversity. Steps of this kind inevitably create confrontation and countermeasures and have the opposite effect to the hoped-for goals. We see what happens when politics rashly starts meddling in the economy and the logic of rational decisions gives way to the logic of confrontation that only hurt one's own economic positions and interests, including national business interests.

Joint economic projects and mutual investment objectively bring countries closer together and help to smooth out current problems in relations between states. But today, the global business community faces unprecedented pressure from Western governments. What business, economic expediency and pragmatism can we speak of when we hear slogans such as "the homeland is in danger", "the free world is under threat", and "democracy is in jeopardy"? And so everyone needs to mobilise. That is what a real mobilisation policy looks like.

Sanctions are already undermining the foundations of world trade, the WTO rules and the principle of inviolability of private property. They are dealing a blow to liberal model of globalisation based on markets, freedom and competition, which, let me note, is a model that has primarily benefited precisely the Western countries. And now they risk losing trust as the leaders of globalisation. We have to ask ourselves, why was this necessary? After all, the United States' prosperity rests in large part on the trust of investors and foreign holders of dollars and US securities. This trust is clearly being undermined and signs of disappointment in the fruits of globalisation are visible now in many countries.

The well-known Cyprus precedent and the politically motivated sanctions have only strengthened the trend towards seeking to bolster economic and financial sovereignty and countries' or their regional groups' desire to find ways of protecting themselves from the risks of outside pressure. We already see that more and more countries are looking for ways to become less dependent on the dollar and are setting up alternative financial and payments systems and reserve currencies. I think that our American friends are quite simply cutting the branch they are sitting on. You cannot mix politics and the economy, but this is what is happening now. I have always thought and still think today that politically motivated sanctions were a mistake that will harm everyone, but I am sure that we will come back to this subject later.

We know how these decisions were taken and who was applying the pressure. But let me stress that Russia is not going to get all worked up, get offended or come begging at anyone's door. Russia is a self-sufficient country. We will work within the foreign economic environment that has taken shape, develop domestic production and technology and act more decisively to carry out transformation. Pressure from outside, as has been the case on past occasions, will only consolidate our society, keep us alert and make us concentrate on our main development goals.

Of course the sanctions are a hindrance. They are trying to hurt us through these sanctions, block our development and push us into political, economic and cultural isolation, force us into backwardness in other words. But let me say yet again that the world is a very different place today. We have no intention of shutting ourselves off from anyone and choosing some kind of closed development road, trying to live in autarky. We are always open to dialogue, including on normalising our economic and political relations. We are counting here on the pragmatic approach and position of business communities in the leading countries.

Some are saying today that Russia is supposedly turning its back on Europe - such words were probably spoken already here too during the discussions - and is looking for new business partners, above all in Asia. Let me say that this is absolutely not the case. Our active policy in the Asian-Pacific region began not just yesterday and not in response to sanctions, but is a policy that we have been following for a good many years now. Like many other countries, including Western countries, we saw that Asia is playing an ever greater role in the world, in the economy and in politics, and there is simply no way we can afford to overlook these developments.

Let me say again that everyone is doing this, and we will do so to, all the more so as a large part of our country is geographically in Asia. Why should we not make use of our competitive advantages in this area? It would be extremely shortsighted not to do so.

Developing economic ties with these countries and carrying out joint integration projects also creates big incentives for our domestic development. Today's demographic, economic and cultural trends all suggest that dependence on a sole superpower will objectively decrease. This is something that European and American experts have been talking and writing about too.

Perhaps developments in global politics will mirror the developments we are seeing in the global economy, namely, intensive competition for specific niches and frequent change of leaders in specific areas. This is entirely possible.

There is no doubt that humanitarian factors such as education, science, healthcare and culture are playing a greater role in global competition. This also has a big impact on international relations, including because this 'soft power' resource will depend to a great extent on real achievements in developing human capital rather than on sophisticated propaganda tricks.

At the same time, the formation of a so-called polycentric world (I would also like to draw attention to this, colleagues) in and of itself does not improve stability; in fact, it is more likely to be the opposite. The goal of reaching global equilibrium is turning into a fairly difficult puzzle, an equation with many unknowns.

So, what is in store for us if we choose not to live by the rules – even if they may be strict and inconvenient – but rather live without any rules at all? And that scenario is entirely possible; we cannot rule it out, given the tensions in the global situation. Many predictions can already be made, taking into account current trends, and unfortunately, they are not optimistic. If we do not create a clear system of mutual commitments and agreements, if we do not build the mechanisms for managing and resolving crisis situations, the symptoms of global anarchy will inevitably grow.

Today, we already see a sharp increase in the likelihood of a whole set of violent conflicts with either direct or indirect participation by the world's major powers. And the risk factors include not just traditional multinational conflicts, but also the internal instability in separate states, especially when we talk about nations located at the intersections of major states' geopolitical interests, or on the border of cultural, historical, and economic civilizational continents.

Ukraine, which I'm sure was discussed at length and which we will discuss some more, is one of the example of such sorts of conflicts that affect international power balance, and I think it will certainly not be the last. From here emanates the next real threat of destroying the current system of arms control agreements. And this dangerous process was launched by the United States of America when it unilaterally withdrew from the Anti-Ballistic Missile Treaty in 2002, and then set about and continues today to actively pursue the creation of its global missile defence system.

Colleagues, friends,

I want to point out that we did not start this. Once again, we are sliding into the times when, instead of the balance of interests and mutual guarantees, it is fear and the balance of mutual destruction that prevent nations from engaging in direct conflict. In absence of legal and political instruments, arms are once again becoming the focal point of the global agenda; they are used wherever and however, without any UN Security Council sanctions. And if the Security Council refuses to produce such decisions, then it is immediately declared to be an outdated and ineffective instrument.

Many states do not see any other ways of ensuring their sovereignty but to obtain their own bombs. This is extremely dangerous. We insist on continuing talks; we are not only in favour of talks, but insist on continuing talks to reduce nuclear arsenals. The less nuclear weapons we have in the world, the better. And we are ready for the most serious, concrete discussions on nuclear disarmament – but only serious discussions without any double standards.

[Oct 22, 2014] Don't Mistake Russia for Iran By Eric Lorber and Elizabeth Rosenberg

October 20, 2014 | foreignaffairs.com

With sanctions beginning to bite, Russia is starting to play a new economic game. To alleviate the pain of Western restrictions on its financial and energy sectors, Russia is turning for help to non-Western partners. Last week alone, Russia and China signed over 40 agreements that provide Russian firms with lines of credit worth billions of dollars and establish strategic partnerships in the energy sector.

The United States, in turn, is looking to step up its own game. Policymakers are considering giving global companies a choice: stop providing long-term financing and energy assistance to major Russian companies or be kicked out of the U.S. financial system. Such measures resemble the sanctions the United States placed on Iran a couple of years ago. But Iran was a different problem. And treating Russia the same way would be a mistake.

Sanctions can be an effective tool for forcing engagement and negotiation. But the pace and implementation must be tailored to the target. In the case of Iran, the United States was able to tighten the screws by pressuring foreign firms to stop dealing with the country. That move created some angry blowback, but it generally worked. And partially as a result, Tehran is at the negotiating table. When it comes to Russia, though, the political pushback that would come from blacklisting dealings with the strategic Russian energy and banking sectors would be much more severe because Russia is a more important market. Further, more companies would likely be willing to forego access to U.S. markets in order to continue working with the Russians. And that would undermine the sanctions' effectiveness.

More generally, policymakers in the United States should be wary of continually relying on sanctions that penalize foreign firms by preventing their access to U.S. markets. Ultimately, such a strategy could backfire. At some point, foreign companies may decide that doing business in U.S. markets -- and being subject to U.S. sanctions policies -- is simply not worth it. That would hurt the U.S. economy and diminish the United States' ability to use economic levers to advance its foreign policy.

[Oct 21, 2014] Ukraine Used Cluster Bombs, Evidence Indicates By ANDREW ROTH

Kiev doesn't bother to enforce the Geneva conventions. The army behaves in the Donbass as occupiers. They consider the local population as a hostile ethnic group like in any civil war.
Oct 21, 2014 | nytimes.com

A casing carrying cluster munitions that landed in a shed. Press officers for the Ukrainian military denied that their troops had used cluster weapons in the conflict. Credit Sergey Ponomarev for The New York Times

DONETSK, Ukraine - The Ukrainian Army appears to have fired cluster munitions on several occasions into the heart of Donetsk, unleashing a weapon banned in much of the world into a rebel-held city with a peacetime population of more than one million, according to physical evidence and interviews with witnesses and victims.

Sites where rockets fell in the city on Oct. 2 and Oct. 5 showed clear signs that cluster munitions had been fired from the direction of army-held territory, where misfired artillery rockets still containing cluster bomblets were found by villagers in farm fields.

The two attacks wounded at least six people and killed a Swiss employee of the International Red Cross based in Donetsk.

If confirmed, the use of cluster bombs by the pro-Western government could complicate efforts to reunite the country, as residents of the east have grown increasingly bitter over the Ukrainian Army's tactics to oust pro-Russian rebels

... ... ...

On the morning of Oct. 5, Boris V. Melikhov, 37, was chopping wood outside his house in the Gladkovka neighborhood of Donetsk when he heard the loud clap of an explosion from the street.

His first sensation was "a strong push in the back," and he sprawled onto the grass. More explosions followed, showering Mr. Melikhov with dust and dirt. Unable to stand, he crawled toward a spigot in the garden, bleeding profusely and desperate for water.

"I felt the blood running down my back, down my leg," he recalled in an interview last week from his bed in a hospital, where his uncle took him after the attack. Doctors there found several identical metal fragments in his leg, chest, shoulder and hand.

Hundreds of such fragments, each about the size of a thumbtack, were sprayed out by at least 11 cluster bomblets that exploded on Mr. Melikhov's street that morning. The 9N210 bomblets are carried in surface-to-surface Uragan (Hurricane) rockets that are fired from the backs of trucks and have a range of roughly 22 miles.

Part of one of the rockets smashed into a street a few blocks away, and the impact crater indicated it had come from the southwest.

The same morning, sunflower farmers near Novomikhailovka, a small village about 20 miles southwest of Mr. Melikhov's house, saw rockets sailing almost directly overhead toward Donetsk. Local people said in interviews that the army had been launching Uragan rockets from there for more than a week.

"Trust me, when it is day after day after day, you get to know your Grad launches from your Uragan launches," said one farmer, who asked not to be named for fear of retribution for discussing Ukrainian military positions.

... ... ...

Uragan rockets can carry 30 of the submunitions, which look like metal cans with fins. Those bomblets in turn hold small pieces of chopped steel rod. The rocket releases the bomblets over a wide area, and the bomblets either explode on impact, flinging out lethal steel fragments, or land unexploded and effectively become land mines. Children often mistake them for toys.

At the Red Cross headquarters in Donetsk, Human Rights Watch researchers accompanied by a Times reporter documented 19 distinct impacts of cluster submunitions from the Oct. 2 attack. Judging by impact craters from rockets fired in the same salvo, the researchers said, the strike came from the southwest.

A witness to the Oct. 2 launch in Novomikhailovka told the reporter about the malfunctioning rockets in the fields. Other witnesses interviewed by Human Rights Watch on the evening of Oct. 2 confirmed that rockets had been fired from just south of the village toward Donetsk.

An advocacy group called the Cluster Munitions Coalition has been pressing Ukraine to join the international convention banning the stockpiling or use of the weapons. (Russia and the United States have not joined it, either.) The group's director, Sarah Blakemore, wrote to the Ukrainian Foreign Ministry in July after images were published appearing to show the use of cluster munitions against rebel positions in the cities of Slovyansk and Kramatorsk.

She said in a telephone interview that she had received no reply. "When I say they neither confirmed or denied, I mean they really just did not do anything," Ms. Blakemore said.

... ... ...

In Donetsk, doctors in a city hospital and morgue said they had found cluster-munitions fragments in several patients, including Mr. Melikhov, whose spine was nicked by one on Oct. 5. He was lucky not to have been paralyzed, but the injury made it very painful to sit, stand or lie flat, he said.

"I see it as the senseless destruction of the southeast," he said of the attack. "There's something wrong in their head."

[Oct 21, 2014] Question: Does Russia represent an alternative to the current western economic/social model? Or is this view an illusion based only on the conflict between some traditional vs. post-modern values?

Left-biased, but still very interesting assessment of the situation. Especially in the first part (the first 14 questions) Quote: "All attempts by Russia to develop a hypothetical line of response based on similar strategies (i.e. mobilizing a social response based on discontent) have no future, because Russia does not represent an alternative social model, not even in the realm of Illusion of Hope. "
2014/10/19 | Sociología crítica

Danos tu opinión

Un amable lector de este blog ha realizado un resumen en inglés de nuestro artículo Las catedrales del kremlin y el capitalismo multipolar; es un resumen diferente al que nosotros hubiéramos hecho, pero de interés sin duda alguna. Ha sido publicado como apoyo a una pregunta en un coloquio con el economista ruso Mikhail Khazin organizado por The vineyard of the saker. Publicaremos aquí la respuesta.

Question: Does Russia represent an alternative to the current western economic/social model? Or is this view an illusion based only on the conflict between some traditional vs. post-modern values? / Arturo

For context to the question I will provide a translation / paraphrase / summary of some key points in the following article Las catedrales del kremlin y el capitalismo multipolar

The article contains and numbers many more points (36 in total) but I have translated/summarized only the first 14 (the rest is provided is a very raw translation --NNB)

  1. Moscow cannot defeat the American plans – i.e. the Anglo Zionist world elite – without contradicting the class interests of its own elites (Russian oligarchs): This is impossible because the system of sanctions and the blocking of access to their accounts and assets in the West generates such contradictions in the Russian power elites that, in practice, it prevents them from reacting adequately; it puts them on their knees before the American plans.
  2. Russia *could* resist those plans, since it possesses the strength, sense of identity, historical memory and material resources to do so. But in order to do so, its ruling elites would have to take measures that would affect their own class status within both the Russian system and the international system. And we can see that these are measures they are not willing to take. On the other hand, the Anglo Zionists suffer no such internal contradiction. Quite the opposite, in fact: Their own interest as the supporting base of the globalist hyperclass necessarily forces them to maintain the challenge to the end.
  3. By the term Anglo Zionists, in this analysis, we mean the dominant power group whose territorial and military base resides in the United States, and whose center originates in the historical and social links of the Anglo-American oligarchies, branching off to other historical central metropolis in Europe or other power centers in different parts of the world.
  4. The concept is made up of two elements that must be explained: the first, the "anglo" reference, has to do with the North American British connection [...] the second, the "zionist" reference, has to do with the interconnection among the economic and financial power groups that maintain various kinds of links with Israel. It is not so much a reference to ethnic origin, but rather to orientations as groups or lobbies of political and economic interests. A good part of this Zionist component consists of people who are neither Israelis nor Jews, but who feel identified with the pro-Israel lobby in the United States, Britain and other countries. Thus the term "zionist" referees here to an ideology, not to an ethnic origin.
  5. The Anglo elites on both sides of the Atlantic have evolved from being national elites to being the executive base of a world Hyperclass made up of individuals capable of exerting a determining influence in the most powerful nation, the United States.
  6. The result of the Anglo Zionist line of attack is that the contradiction and internal struggle is now occurring in Moscow between those who have already chosen to sell out and those who have not yet found the time to realize that a multipolar global capitalism is not viable.
  7. In this context, recovering Crimea was a mirage, an illusion.
  8. If we compare the implications of the Maidan coup in Kiev with the liberation of Crimea, we see that the strategic defeat implicit in losing Ukraine as an ally is of such magnitude that everything else pales by co s (all of them) in Kiev was so gigantic that its implications are frightening. It was either a failure or something even worse. In any case, the Crimea affair was merely a small episode in a confrontation that Russia is losing.
  9. Russia arrived very late at modern capitalism, and that is why its current elite will be unable to occupy a space among the globalist elite without paying the necessary toll, which is none other than renouncing its territorial power base – its country and its access to and control of its energy resources and raw materials.
  10. Stubbornly maintaining the dispute in trying to obtain a multi-polar capitalism, leads necessarily to a intra-capitalist confrontation, as it did in 1914-1918. And because of the nature of the current actors, nuclear powers … it brings the conflict to 2.0 war versions (color revolutions)
  11. All attempts by Russia to develop a hypothetical line of response based on similar strategies (i.e. mobilizing a social response based on discontent) have no future, because Russia does not represent an alternative social model, not even in the realm of Illusion of Hope. It can only elicit some empathy from those who reject the American domination, but here the class contradictions come into play again, because it is not enough to oppose Washington merely on political-military grounds, since the key to global power resides in the financial and military structures that enable global control and plunder: World Trade Organization, IMF, Free Trade agreements, World Bank, NATO… these are entities in relation to which Russia only shows its displeasure at not being invited to the table as an equal, not accepting that because it arrived late at modern capitalism, it must play a secondary role. On the other hand, Russia is ignoring the deep contempt, bordering on racism, that things Slavic generate among Anglo Zionist elites.
  12. In order to be able to fight the 2.0 versions of war that are engineered today, an alternative social model is needed. Alternative not only in regard to the postmodern vs. traditional sets of values, but fundamentally in regard to the social model that stems from the modes of production. In the postmodern vs. traditional conflict, Russia tends to align with the most reactionary values. And in regard to the social struggle, they don't want to enter that fray because they renounced it long ago. They renounced the entire Soviet Union, which they destroyed from within.
  13. The contradictions and the dialectical nature of reality have their own logic, however. Thus, a coup in Kiev and the widespread appearance of Nazi symbols in the streets of Ukraine was all that it took to induce a spontaneous reaction in the Slavic world. The popular resistance in the Donbass took strong root thanks to the historic memory of the people's of the old USSR and its war against fascism.
  14. If Russia were to abandon Novorossia to the oligarchs and their mafias, the world's "left" – or whatever remains of it - would come to scorn post-Soviet Russia even more than it already does. In the months following the brave action in Crimea and the heroic resistance in the Donbass, many people around the world looked to Moscow in search of some sign that it would support the anti-fascist and anti-oligarchic resistance, even if only as an act of self-defense by Moscow against the globalist challenge. If it finally abandons Novorossia, the price in terms of loss of moral prestige will be absolute.
  15. A support of the left has not been sought, but that is a collateral consequence of the character of class struggle open that has been given in the Donbas, where Russia has been forced to provide some assistance that would prevent the genocide at the hands of the fascist Ukrainian.
  16. Cuando say left, we refer logically to the one who has expressed their support to the struggle of people in the Donbas, as it is very difficult to consider the "left" to those who have preferred to remain silent or to have directly been complicit in the assault, and the coup in Kiev.
  17. The degradation of the left as politically active social force is very intense, their structures are embroiled in the collapse, or in the confusion, when not literally corrupt. Then related to both socialist parties since 1914 and the communists, at least from the time of fracture of 1956. The social changes experienced in Europe with the systems of welfare state, based on the elevation of the standard of living of the working population and the obtaining of social peace by sharing the power with the trade unions are at the base of the post-industrial society and the resulting profound changes of values.

    The suicide of the USSR in 1989-93 marked a brutal global change , in which the balance which was preserved during the cold war was broken. That led to the capitalist elite in the west, which we are calling the Anglo-Zionists, to the suspension of the social pact (forced abandonment of New Deal), that gave rise to the welfare state and the emergence stark reality of a global power of capitalists without systemic opposition . Today the whole neoliberal globalization system of capitalism is in danger by the depletion of the natural resources. And to sustain this mode of production, they need to speed up territorial domination in the form of control and access to resources of other countries. Now there no space in the global system for spaces, which are managed autonomously even to a certain level.

  18. The system of global domination, capitalism, ruling elites with a territorial basis in the area of Anglo-American, global parasitic Hyperclass and depletion of resources, as well as cannibalization of the other nations, in the midst of troika of crisis of climate change, peak of the energy and raw materials shortages. those three factors that challenge the current globalization framework ... And the crisis of Novorossia, been demonstrated both impotence and the lack of real political autonomy of Russian elite with the respect to the dominant power in neoliberal worlds order..
  19. The new citizen movements in the western world are not so much resistance movements as samples of the discontent of the middle classes in precarious position of marginalization and/or social trance. This protest led to a "Maidans" which are not permanent and does not question the basis of the system. The participants seems to believe that it is possible to restore the old good world of the welfare state.
  20. The western movements are brainwashed by messages emanating from the headquarters of Democratic party of North America, the propaganda anarcho-capitalist and the various networks of ideological interference, are managing to break the bonds of historical memory that unite the struggles of the past with the present, de-ideologize the struggles and conflicts and to deny the tension left and right, isolating the militants -- or simple citizens who feel identified with the values of the left - of the masses who are suffering in the first place casualisation. At the heart of this new "left" are leaders that are co-opted voices, pseudo-intellectuals who destroy the words and empty of content of key concepts in a way that the alienation of the masses demonstrate at the language itself, thus preventing putting a real name to social process and things, and to identify the social phenomena.
  21. Viva to Russia, which the only country which eve in a weak form decided to fight neoliberal world order and position itself as an anti-imperialist force... It is interesting to observe the current great moral confusion in political landscape of the societies in decay. Confusion which have been stimulated by Moscow actions. As the result some the far-right groups that are simultaneously anti-US that anti-Russian now support Moscow. Also some part of Russia far-right political groups got the sympathy and support of factions of the anti EU far right forces in France, the Nazis of the MSR in Spain, and from small groups of euro-asianists. This line of political affiliation will allow them to simply join the Russia failure [to find alternative to monopolar neoliberal capitalism] and might well discredit then more profoundly in the future.
  22. The euro-asianists forces technically speaking are reactionary forces, neoliberal forces which is comparable to the worst of the worst in the western world. Moreover, they do not have any way to solve the main contradictions that arise in the current neoliberal model in the terms of class and dominance of Anglo Zionist global elite.
  23. Euro-Asianism is just a suitable ideology for the construction of Russian national idea for those who seeks to achieve lease to life for Russia sovereignty on the world stage. It is the actual proof that Russia has come too late to globalised capitalism and fascism...
  24. Huttington and his war of civilizations cynically exploit this confrontation on Anglo Zionist elite and newcomers, redefining it along the idea of the clash of civilizations which avoid using the notion of class and thus is ideologically false. Alexander Duguin who promote similar ideas quite seriously just shows the degree of degeneration of the Russian intelligentsia, which oscillates between serving as comprador class to the global Anglo Zionist elite and the repetition (as a farce, and with 75 years of delay ) of fascist reactionary revolutions in Western Europe, which were phenomenon of the interwar period (rexistas in Belgium, Croix de feu in France, CruzFlechados in Hungary, Requetés and Falangistas in Spain).
  25. The globalist elite offered a solution formulated in class terms, as it could not be another way: in the best cases, they proposes the co-optation to a handful of members of the Russian elite as deserving members of the new global Hyperclass, but this path is opened only the very very rich, and the pre-condition is the delivery of the country to plunder, where the global elite certainly would have need of some compradors which will be more or less adequately compensated depending on their achievements and sacrifices in the name of global neoliberal domination.
  26. The part of the power elite of Russia, which managed to expel the western compradors of the Yeltsin era, and rein in the oligarchs then, had tried with some success to regain control of the territory of the country. The illusion of the members of this part of the power elite -- basically the security services, both civil and military, and various synergies of those with the military-industrial lobby -- is that it would be enough to neutralize the Russian fifth column of the Anglo Zionists to take back control of their territorial base of power. this idea is going to be shredded into pieces when it enter into contradiction with the reality of the class struggle and interests of the elite at the global level. Russia is, for its size, influence, and resources, so huge that a line of action based on the defense of its sovereignty strategic enters in collision with the global power of neoliberalism. And that why it attracts disproportional reaction of the Anglo Zionists
  27. Supporters of Anglo Zionists that are ready to consent to a German-Russian alliance or Russia-EU alliance that give the viability of a idea of mutually beneficial co-development of both Russia and Europe are forgetting that such an action would require European sovereignty. Which is was non-existent iether on the level of the EU, or on the level of member states. The penetration of the Atlantism in Europe is already systemic. In the old European states there are still ancient national traditions, which were based on the basis of cultural, industrial, economic, and political identity. And they still run strong. But in the current situation for such states there no space for the sovereignty as the dominant power bloc in the national elite as well as in EU elite are Atlantists. Where this situation takes the Russian elite and the Russian state without confrontation? A confrontation that they, on the other hand are not willing and are not able to pursue.
  28. The multi-polar capitalist world had its lifespan which come to an end (exploded) in 1914. In 2014, the globalization of the elites and the capital is of such magnitude that no serious resistance is possible on the basis of some capitalist model. In those conditions the idea of Russian elite ability to enforce change to multipolar version of the currently monopolar neoliberal world is doomed to be a failure.
  29. Zbigniew Brezinsky has raised things crudely and openly, unlike the ("fake") supporters of perestroika, and their current heirs in Russia. Brezinsky know how to think in terms of the class contradiction and knows perfectly well that the Russian oligarchy has directed its monetary flows abroad, moved families abroad, and moved their investments abroad. That means that Anglo Zionists can disrupt any claim of sovereignty over the territory and resources by simply pressing the local neoliberal elite, giving them to choose between their interests as a class and their illusionary desire for sovereignty. Because in a globalized world, with its brutal fight for the natural resources there is no possibility of maintaining both, except what can be achieved in terms of direct anti-imperialist struggle. There is no space for the national bourgeoisies in the XXI century. You can only have sovereignty if it is posed in terms of a rupture with the actually existing neoliberal order of global capitalism, which, in its core is Anglo Zionists globalization. This break does not have to be forced, but in terms of scientific analysis of the social processes is a logical consequence of following this path one way or the other. To claim sovereignty over their own resources and territory inevitably leads to confrontation, and logical needs a break up and confront the Anglo Zionist empire. If you really want to achieve the goal. And that fact imposes the logic of the relationships and balance of power in the world today.
  30. The claims of the BRIC countries -- to the extent that you do not question them -- is that they have an alternative model to the dominant neoliberal capitalism model (Ango Zionist globalization with the center in the USA) are doomed to be a failure. The efforts of the BRIC countries can generate a lot of noise and discomfort for the West, but they can not break the global neoliberal system. Those countries are rightfully fearful of their budget balances -- which are very fragile. It can be even said that they are on their way to implosion sooner or later, due to the unbalanced structure of their internal classes, including first of all their own elite.
  31. The claim that it is possible to achieve the multipolar capitalist world (which Russia defends) and which led to current Ukrainian crisis without confrontation is false. As soon as Russia wanted to return to the global chessboard. as an independent player, they instantly saw opponents attacking weak elements of their defense at the borders. Ukraine has been a defeat for Russia and the Crimea is not a adequate compensation for loss of Ukraine. Now Novorossia is being sacrificed precisely because the class contradictions that have emerged in Moscow and lack of desire of Russian elite to go the bitter end.
  32. The situation in the Donbas / Novorossia clearly shows the resignation of Moscow to the victory, and their desire to avoid the clash with neoliberal world order. The fact is that Royal Dutch Shell has already begun the fracking in the Donbas, the coup regime in Kiev are already internationally accepted without reservations, the truce imposed in Novorossia has brought to its knees the armed resistance to junta. All this leads way to deliver Novorossia to the hands of mafias sponsored by the local oligarchs with friends in Kiev and Moscow.
  33. Statement that the destiny of Russia was played in the Donbas is something more than a phrase, It is a claim based on a reality, as the defeat of Novorossia would be the proof that Moscow had not the will to struggle. The betrayal of the fighters and the hopes of Novorossia is the acceptance of the defeat and might lead in the future to the victory to the Moscow Maidan, the same alliance of compradors and nationalists using which as storm troopers the globalist elite achieved their goal in Ukraine. If Novorossia is defeated, they can expect being able to push a puppet into the Kremlin the same way. And not without reason. This summer, the heroic struggle of the militia of the Donbas was the key element that forced the changes of the script designed for Kiev as well as diminished chances of successful application of the same methods in Moscow. The Minsk Agreements and the truce imposed by them are putting Novorossia on its knees, allowing for its destruction, but this time at the hands of their allies. Sad spectacle for the Russian security services, which were effective enough to organize the Donbas resistance, but now are useless and powerless before the neofascist Kiev junta.
  34. The struggle of the Donbas does not correspond to the strategic interests of the Russian elite. They have been forced to intervene to prevent the horror of the mass murder of the population of the Donbas at the hands of the extreme right. But the dream of a Donbas free of oligarchs and with a sovereign state, committed to social justice for workers on this Slavic land are completely incompatible with the post-soviet status quo. Only to the extent that there is a significant faction of Russian elite aware of the contradictions of the global neoliberal game and who put their sense of patriotism first can lead them to face the challenge that they face. Only in this case there would be any possibility of resistance; I would say patriotic resistance, because we already know no one at the top is able to think in terms of class.
  35. While very unlikely - there can be a move from February to October in Novorossia. You would say impossible. But he insurrection of the Donbas in March, logically was "February". In order to achieve victory, to take full control over the territory of Donetsk and Lugansk needs creation of the Revolutionary Military Council and suspension of the upcoming elections. which looking to be a smokescreen for capitulation to junta. They need to declare that they are ready to resist to the end. This output would be desperate move, without a doubt, and would represent the equivalent of a new "October". The event which of it occurs would force Moscow to show their cards to their own population. And perhaps it can help to generate a pulse necessary for the organization of the fight with Anglo Zionists empire between the towers of the Kremlin. That would move the fight toward more patriotic and popular goals, But this presuppose a lot of assumptions and first of all that such a "Kremlin tower", which is capable of emitted such a pulse, exists. Only in this case we can talk about achieving a real sovereignty. As Vasily Záitsev in Stalingrad suggested: "Maybe we're doomed, but for the moment we are still the masters and lords of our land." In Novorossia there are plenty of fighters who would agree with Záitsev, but they certainly lack political direction and, now the lack the support of Kremlin.
  36. The Russian objective is achieving a multipolar capitalism with a Russia united under a nationalist ideology based on the manipulation of patriotic sentiment, Orthodoxy and various Slavic myths. This objective is being challenged by the reality of the conflict, which should be defined in terms of geopolitical goals. The reality is that the Russian elite would be allowed to control their population as they wish, provided they renounce its sovereignty over territory and resources, renounce their physical power base, i.e. homeland. This is the nature of the challenge. Putin is mistaken if he thinks that the Grand Patriarch has the answer in their holy books. There is not enough incense in the Kremlin cathedrals to mask that reality."

[Oct 21, 2014] Address by Russian Foreign Minister Sergey Lavrov to the 69th session of the UN General Assembly

Compare argumentation with Sociología crítica To be a neoliberal society and be free from US dominance is not very realistic until oil became at least twice more expensive and neoliberal model of globalization start collapsing. While critique of the US policy is up to the point, what is the alternative to the current situation? Russia is weaker then the USA neoliberal state and so far it does not look like it decided to abandon neoliberalism. And if not, then what is the point of confrontation ? Clearly the USA has geopolitical ambitions in Eastern Europe. And they want to exploit their status as the pre-eminent neo-liberal state, like Moscow was for socialist camp, so to speak to squeeze Russia, as a dissident state, which deviates from neoliberal agenda. Ukraine just fall victim of this squeezing. Collateral damage so to speak. And the key problem with Ukraine neither the USA nor EU want to compensate the damage their actions inflicted, to offer Marshall plan to Kiev.
Sep 27, 2014 | mid.ru

...There is growing evidence of the contradiction between the need for collective, cooperative efforts to provide adequate responses to challenges common to all, and the aspirations of a number of countries for domination and the revival of archaic bloc thinking based on military drill discipline and the erroneous logic of "friend or foe."

The US-led Western alliance that portrays itself as a champion of democracy, rule of law and human rights within individual countries,acts from a completely opposite position in the international arena, rejecting the democratic principle of the sovereign equality of states enshrined in the UN Charter and tires to decide for everyone what is good or bad.

Washington has openly declared its right to the unilateral use of force anywhere to uphold its own interests. Military interference has become common, even despite the dismal outcome of the use of power that the US has carried out in recent years.

The sustainability of the international system has been severely shaken by NATO bombardment of Yugoslavia, intervention in Iraq, the attack against Libya and the failure of the operation in Afghanistan. Thanks only to intensive diplomatic efforts, an aggression against Syria was averted in 2013. There is the involuntary impression that the goal of various "colour revolutions" and other goals to change unsuitable regimes is to provoke chaos and instability.

Today, Ukraine has fallen victim to such an arrogant policy. The situation there has revealed the remaining deep-rooted systemic flaws of the existing architecture in the Euro-Atlantic area. The West has embarked upon a course towards "the vertical structuring of humanity" tailored to its own hardly inoffensive standards. After they declared victory in the Cold War and the "end of history," the US and the EU opted for expanding the geopolitical area under their control without taking into account the balance of legitimate interests of all the people of Europe. Our Western partners did not heed our numerous alerts on the unacceptability of the violation of the principles of the UN Charter and the Helsinki Final Act, and time and again avoided serious cooperative work to establish a common space of equal and indivisible security and cooperation from the Atlantic to the Pacific. The Russian proposal to draft a European security treaty was rejected. We were told directly that only the members of the North Atlantic Alliance could have the legally binding guarantees of security, and NATO expansion to the East continued in spite of the promises to the contrary given previously. NATO's change toward hostile rhetoric and to the drawdown of its cooperation with Russia even to the detriment of the West's own interests, and the additional build-up of the military infrastructure at Russian borders made the inability of the alliance to change its genetic code embedded during the Cold War era obvious.

The US and the EU supported the coup in Ukraine and reverted to outright justification of any act by the self-proclaimed Kiev authorities that used suppression by force on the part of the Ukrainian people that had rejected the attempts to impose an anti-constitutional way of life to the entire country and wanted to defend its rights to a native language, culture and history. It was precisely the aggressive assault on these rights that compelled the population of Crimea to take destiny into its own hands and make a choice in favor of self-determination. This was an absolutely free choice no matter what has been invented by those who were, in the first place, responsible for the internal conflict in Ukraine.

The attempts to distort the truth and to hide the facts behind blanket accusations have been undertaken at all stages of the Ukrainian crisis. Nothing has been done to track down and prosecute those responsible for February's bloody events at Maidan and the massive loss of human life in Odessa, Mariupol and other regions in Ukraine. The scale of appalling humanitarian disaster provoked by the acts of the Ukrainian army in southeastern Ukraine has been deliberately underscored. Recently, new horrible facts have been brought to light as mass graves were discovered in the outskirts of Donetsk. Despite UNSC Resolution 2166 a thorough and independent investigation of the circumstances into the loss of the Malaysian airliner over the territory of Ukraine has been protracted. The culprits of all these crimes must be identified and brought to justice. Otherwise it is unrealistic to expect a national reconciliation in Ukraine.

... ... ...

Let me recall the not too distant past. As a condition for establishing diplomatic relations with the Soviet Union in 1933 the U.S. government demanded of Moscow the guarantees of non-interference in the domestic affairs of the US and obligations not to take any actions with a view to changing political or social order in America. At that time Washington feared a revolutionary virus and the above guarantees were put on record and were based on reciprocity. Perhaps, it makes sense to return to this item and reproduce that demand of the US government on a universal scale. Shouldn't the General Assembly adopt a declaration on the unacceptability of interference into the domestic affairs of sovereign states and non-recognition of a coup as a method for changing power? The time has come to exclude from international interaction the attempts of illegitimate pressure of some states on others. The meaningless and counterproductive nature of unilateral sanctions is obvious if we review the US blockade of Cuba.

The policy of ultimatums and philosophy of supremacy and domination do not meet the requirements of the 21st century and run counter to the objective process of development for a polycentric and democratic world order.

Russia is promoting a positive and unifying agenda. We always were and will be open to discussion of the most complex issues no matter how unsolvable they would seem in the beginning. We will be prepared to search for compromises and the balancing of interests and go as far as to exchange concessions provided only that the discussion is respectful and equal.

... ... ...

New dividing lines in Europe should not be allowed, even more so given that under globalization these lines can turn into a watershed between the West and the rest of the world. It should be stated honestly that no one has a monopoly on truth and that no one can tailor global and regional processes to one's own needs. There is no alternative today to the development of consensus regarding the rules of sustainable global governance under new historical circumstances - with full respect for cultural and civilizational diversity in the world and the multiplicity of the models of development. It will be a difficult and perhaps tiresome task to achieve such a consensus on every issue. Nevertheless the recognition of the fact that democracy in every state is the "worst form of government, except for all the others" also took time to break through, until Winston Churchill passed his verdict. The time has come to realize the inevitability of this axiom including in international affairs where today there is a huge deficit of democracy. Of course someone will have to break up centuries-old stereotypes and abandon the claims to eternal uniqueness. But there is no other way. Consolidated efforts can only be built on the principles of mutual respect and by taking into account the interests of each other as is the case, for example, under the framework of BRICS and the SCO, the G20 and the UN Security Council.

The theory of the advantages of cooperative action has been supported by practice: this includes progress in the settlement of the situation around the Iranian nuclear program and the successful conclusion of the chemical demilitarization of Syria. Also, regarding the issue of chemical weapons, we would like to obtain authentic information on the condition of the chemical arsenals in Libya. We understand that our NATO colleagues, after bombing this country in violation of a UNSC Resolution, would not like to "stir up"" the mayhem they created. However, the problem of uncontrolled Libyan chemical arsenals is too serious to turn a blind eye to. The UN Secretary General has an obligation to show his responsibility on this issue as well.

What is important today is to see the global priorities and avoid making them hostages to a unilateral agenda. There is an urgent need to refrain from double standards in the approaches to conflict settlement. Everybody largely agrees that it is a key issue to resolutely counter the terrorists who are attempting to control increasingly larger territories in Iraq, Syria, Afghanistan and the Sahara-Sahel area. If this is the case then this task should not be sacrificed to ideological schemes or a desire to retaliate. Terrorists, no matter what their slogans, should remain outside the law.

Moreover, it goes without saying that the fight against terrorism should be based solidly on international law. The unanimous adoption of a number of UNSC Resolutions including those on the issue of foreign terrorist operatives became an important stage in this fight. And conversely, the attempts to act against the Charter of our Organization do not contribute to the success of cooperative efforts. The struggle against terrorists in Syria should be structured in cooperation with the Syrian government, which has clearly stated its willingness to join it. Damascus has already proven its ability to work with the international community by delivering on its obligations under the programme to dispose of its chemical weapons.

... ... ...

Corporatism Is Not Capitalism: 7 Things About The Monolithic Predator Corporations That Dominate Our Economy That Every American Should Know

By Michael, on October 21st, 2011

Right now, there is a lot of talk about the evils of "capitalism". But it is not really accurate to say that we live in a capitalist system. Rather, what we have in the United States today, and what most of the world is living under, is much more accurately described as "corporatism". Under corporatism, most wealth and power is concentrated in the hands of giant corporations and big government is used as a tool by these corporations to consolidate wealth and power even further. In a corporatist system, the wealth and power of individuals and small businesses is dwarfed by the overwhelming dominance of the corporations. Eventually, the corporations end up owning almost everything and they end up dominating nearly every aspect of society. As you will see below, this very accurately describes the United States of America today. Corporatism is killing this country, and it is not what our founding fathers intended.

The following is the definition of "corporatism" from the Merriam-Webster dictionary….

the organization of a society into industrial and professional corporations serving as organs of political representation and exercising control over persons and activities within their jurisdiction

Corporatism is actually not too different from socialism or communism. They are all "collectivist" economic systems. Under corporatism, wealth and power are even more highly concentrated than they are under socialism or communism, and the truth is that none of them are "egalitarian" economic systems. Under all collectivist systems, a small elite almost always enjoys most of the benefits while most of the rest of the population suffers.

The Occupy Wall Street protesters realize that our economic system is fundamentally unjust in many ways, but the problem is that most of them want to trade one form of collectivism for another.

But our founding fathers never intended for us to have a collectivist system.

Instead, they intended for us to enjoy a capitalist system where true competition and the free enterprise system would allow individuals and small businesses to thrive.

In an article that was posted earlier this year on Addicting Info, Stephen D. Foster Jr. detailed how our founding fathers actually felt about corporations….

The East India Company was the largest corporation of its day and its dominance of trade angered the colonists so much, that they dumped the tea products it had on a ship into Boston Harbor which today is universally known as the Boston Tea Party. At the time, in Britain, large corporations funded elections generously and its stock was owned by nearly everyone in parliament. The founding fathers did not think much of these corporations that had great wealth and great influence in government. And that is precisely why they put restrictions upon them after the government was organized under the Constitution.

After the nation's founding, corporations were granted charters by the state as they are today. Unlike today, however, corporations were only permitted to exist 20 or 30 years and could only deal in one commodity, could not hold stock in other companies, and their property holdings were limited to what they needed to accomplish their business goals. And perhaps the most important facet of all this is that most states in the early days of the nation had laws on the books that made any political contribution by corporations a criminal offense.

Our founding fathers would have never approved of any form of collectivism. They understood that all great concentrations of wealth and power represent a significant threat to the freedoms and liberties of average citizens.

Are you not convinced that we live in a corporatist system?

Well, keep reading.

The following are 7 things about the monolithic predator corporations that dominate our economy that every American should know….

  1. Corporations not only completely dominate the U.S. economy, they also completely dominate the global economy as well. A newly released University of Zurich study examined more than 43,000 major multinational corporations. The study discovered a vast web of interlocking ownerships that is controlled by a "core" of 1,318 giant corporations.

    But that "core" itself is controlled by a "super-entity" of 147 monolithic corporations that are very, very tightly knit. As a recent article in NewScientist noted, these 147 corporations control approximately 40 percent of all the wealth in the entire network….

    When the team further untangled the web of ownership, it found much of it tracked back to a "super-entity" of 147 even more tightly knit companies – all of their ownership was held by other members of the super-entity – that controlled 40 percent of the total wealth in the network. "In effect, less than 1 percent of the companies were able to control 40 percent of the entire network," says Glattfelder. Most were financial institutions. The top 20 included Barclays Bank, JPMorgan Chase & Co, and The Goldman Sachs Group.

    Unsurprisingly, the "super-entity" of 147 corporations is dominated by international banks and large financial institutions. For example, JP Morgan Chase, Goldman Sachs, Morgan Stanley and Bank of America are all in the top 25.

  2. This dominance of the global economy by corporations has allowed global wealth to become concentrated to a very frightening degree.

    According to Credit Suisse, those with a household net worth of a million dollars or more control 38.5% of all the wealth in the world. Last year, that figure was at 35.6%. As you can see, it is rapidly moving in the wrong direction.

    For a group of people that represents less than 0.5% of the global population to control almost 40 percent of all the wealth is insane.

    The dominance of corporations is also one of the primary reasons why we are witnessing income inequality grow so rapidly in the United States. The following comes from a recent article in the Los Angeles Times….

    An economic snapshot from the Economic Policy Institute shows that inflation-adjusted incomes of the top 1% of households increased 224% from 1979 to 2007, while incomes for the bottom 90% grew just 5% in the same time period. Those in the top 0.1% of income fared even better, with incomes growing 390% over that time period.

    You can see a chart that displays these shocking numbers right here.

  3. Since wealth has become concentrated in very few hands, that means that there are a whole lot of poor people out there.

    At a time when technology should be making it possible to lift standards of living all over the globe, poverty just continues to spread. According to the same Credit Suisse study referenced above, the bottom two-thirds of the global population controls just 3.3% of all the wealth.

    Not only that, more than 3 billion people currently live on less than 2 dollar a day.

    While the ultra-wealthy live the high life, unimaginable tragedies play out all over the globe every single day. Every 3.6 seconds someone starves to death and three-quarters of them are children under the age of 5.

  4. Giant corporations have become so dominant that it has become very hard for small businesses to compete and survive in the United States.

    Today, even though our population is increasing, the number of small businesses continues to decrease.

    According to the Bureau of Labor Statistics, 16.6 million Americans were self-employed back in December 2006. Today, that number has shrunk to 14.5 million.

    This is the exact opposite of what should be happening under a capitalist system.

  5. Big corporations completely dominate the media. Almost all of the news that you get and almost all of the entertainment that you enjoy is fed to you by giant corporations.

    Back in 1983, somewhere around 50 corporations controlled the vast majority of all news media in the United States.

    Today, control of the news media is concentrated in the hands of just six incredibly powerful media corporations.

  6. Big corporations completely dominate our financial system. Yes, there are hundreds of choices in the financial world, but just a handful control the vast majority of the assets.

    Back in 2002, the top 10 banks controlled 55 percent of all U.S. banking assets. Today, the top 10 banks control 77 percent of all U.S. banking assets.

    The "too big to fail" banks just keep getting more and more powerful. For example, the "big six" U.S. banks (Goldman Sachs, Morgan Stanley, JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo) now possess assets equivalent to approximately 60 percent of America's gross national product.

  7. Big corporations completely dominate our political system. Because they have so much wealth and power, corporations can exert an overwhelming amount of influence over our elections. Studies have shown that in federal elections the candidate that raises the most money wins about 90 percent of the time.

    Politics in America is not about winning over hearts and minds.

    It is about who can raise the most cash.

    Sometimes this truth leaks out a bit in the mainstream media. For example, during a recent show on MSNBC, Dylan Ratigan made the following statement….

    "The biggest contributor to Barack Obama's presidential campaign is Goldman Sachs. The primary activities of this president relative to banking have been to protect the most lucrative aspect of that business, which is the dark market for credit default swaps and the like. That has been the explicit agenda of his Treasury Secretary. This president is advocating trade agreements that allow enhanced bank secrecy in Panama, enhanced murdering of union members in Colombia, and the refunding of North Korean slaves."

    Later on, Ratigan followed up by accusing both political parties of working for the bad guys….

    "But I guess where I take issue is, this president is working for the bad guys. The Democrats are working for the bad guys. So are the Republicans. The Democrats get away with it by saying, 'Look at how crazy the Republicans are; at the Democrats pretend to care about people.' BUT THE FACT IS THE 2-PARTY POLITICAL SYSTEM IS UTTERLY BOGUS."

    Wow – nobody is actually supposed to say that on television.

    Today, most of our politicians are bought, and most of them actively help the monolithic predator corporations accumulate even more wealth and even more power.

    In fact, as I wrote about recently, the big Wall Street banks are already trying to buy the election in 2012.

    Fortunately, it looks like the American people are starting to wake up. According to one recent survey, only 23 percent of all Americans now trust the financial system, and 60 percent of all Americans are either "angry" or "very angry" about the economy.

    Unfortunately, many of them are joining protest movements such as Occupy Wall Street which are calling for one form of collectivism to replace another.

    The American people are being given a false choice.

    We don't have to choose between corporatism and socialism.

    We don't have to choose between big corporations and big government.

    Our founding fathers actually intended for corporations and government to both be greatly limited.

    The following is a famous quote from Thomas Jefferson….

    "I hope that we shall crush in its birth the aristocracy of our monied corporations, which dare already to challenge our government to a trial of strength, and bid defiance to the laws of our country."

    Unfortunately, things did not turn out how Jefferson wanted. Instead of us controlling the corporations, they now control us.

    This next quote is from John Adams….

    "Banks have done more injury to the religion, morality, tranquility, prosperity, and even wealth of the nation than they can have done or ever will do good."

    But who dominates our economy today?

    The big banks.

    Perhaps we should have listened to founding fathers such as John Adams.

    Lastly, here is another quote from Thomas Jefferson….

    "If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them (around the banks), will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered."

    How prescient was that quote?

    Last year, over a million American families were booted out of their homes by the big banks. The financial institutions actually now have more total equity in our homes than we do.

    Unemployment is rampant, but corporate profits are soaring. The number of Americans on food stamps has increased by more than 70 percent since 2007, and yet the incomes of those at the top of the food chain continue to increase.

    We need a system that allows all Americans to start small businesses, compete fairly and have a chance at success.

    Instead, what we have is a corporatist system where the big corporations have most of the wealth, most of the power and most of the advantages.

    We need to get the American people to understand that corporatism is not capitalism.

    Corporatism is a collectivist system that allows the elite to accumulate gigantic amounts of wealth and power.

    The answer to such a system is not to go to a different collectivist system.

    Rather, we need to return as much power as possible to individuals and small businesses.

    Our founding fathers intended for us to live in a country where power was highly decentralized.

    Why didn't we listen to them?

Globalization and Macroeconomics - NYTimes.com

My dialogue with Monti, to the extent that it was a "debate", focused on the whole issue of structural reform; not on whether it's a good thing (of course it depends on what's being reformed, but surely every economy has structural problems that need work), but on whether it deserves the kind of star billing it gets in discussions of crisis response. More on that in another post, I think.

What I want to talk about right now is a different issue that cropped up (not with Monti, but elsewhere); the assertion that globalization has changed the rules for macroeconomics.

Now, there were some assertions to the effect that this crisis was totally different from 1929, because that wasn't a global crisis - which those of us who know a bit about the history found jaw-dropping. Of course 1929 was global. And in general people tend to be strangely unaware of the extent to which a global system of trade and finance existed before World War I. Keynes memorably wrote about this system in The Economic Consequences of the Peace:

What an extraordinary episode in the economic progress of man that age was which came to an end in August, 1914! … The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, in such quantity as he might see fit, and reasonably expect their early delivery upon his doorstep; he could at the same moment and by the same means adventure his wealth in the natural resources and new enterprises of any quarter of the world, and share, without exertion or even trouble, in their prospective fruits and advantages; or be could decide to couple the security of his fortunes with the good faith of the townspeople of any substantial municipality in any continent that fancy or information might recommend.

Yet it would be wrong to suggest that all we have done is return to a pre-World War I level of globalization. That was arguably true into the early 1970s, but since then trade in manufactured goods –driven largely by falling transport costs and the advent of containerization - has indeed reached previously unseen levels (pdf):

The question is, does this change macroeconomics in a fundamental way? In particular, does it mean that nations no longer have much control over their own destiny, even if they retain their own currencies?

I say no. There are several reasons for this, but one important point is the nature of that rapid growth in manufactures trade. For it mainly involves vertical specialization, breaking up the value chain, so that in the course of producing $1 of final consumer goods one may have several dollars' worth of trade. The gains from this trade are as real as those from any kind of trade; but the macro implications are different. Put it this way: while we trade a lot more than we used to, we probably if anything spend a higher share of our income on nontraded goods and (mostly) services than we did a few decades ago, and maybe even more than in 1913.

As a result, statements you commonly hear, like "Stimulus doesn't work, because all the money ends up being spent on stuff made in China", are just not true. Actually, even a dollar spent on Chinese-made consumer goods has a large U.S. value-added component. Yes, some demand leaks abroad - but not nearly as much as people imagine. In general, I'd argue that the rules for macro policy have changed relatively little since the 1930s, and globalization certainly hasn't produced a qualitative change.

A while back Mark Thoma joked that "new economic thinking means reading old books". And it should: those old books remain deeply relevant.


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