Ian Welsh

The horizon is not so far as we can see, but as far as we can imagine

Category: United States

Russia Is An Imperial State While America Is A Plutocratic Oligarchy

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On December 11, 2023

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An oligarchy, as we use the word today (the dictionary definition is different) is rule by the rich, because they are rich. (A feudal king may be rich, but his power is not primarily a result of his wealth, but rather his wealth is primarily a result of his power.)

As I have written a number of times before, Russia is NOT a plutocratic oligarchy. America, on the other hand, is. What wealthy American elites want is what they get, and what ordinary people want they don’t get: this was shown clearly by the Princeton Oligarchy Study.

When Putin took control of Russia he broke the oligarchs.

In the summer of 2000, Putin met in the Kremlin with about two dozen of the men regarded as the top oligarchs. The meeting was closed, but reports later said he made them a sternly clear deal: Stay out of politics and your wealth won’t be touched…

…

By then, Berezovsky had already begun criticizing Putin. Within months, he left Russia for the United Kingdom and was granted asylum in 2003. Ten years later, he was found dead in his home; a disputed post-mortem examination said he appeared to have hanged himself.

Gusinsky, whose media holdings were critical of Putin and even satirized him, was hauled into jail amid an investigation of misappropriated funds; within weeks, he agreed to sell his holdings to an arm of Russia’s state natural gas monopoly, and he left the country.

Khodorkovsky, regarded as Russia’s richest man at the time, lasted longer, establishing the Open Society reformist group and showing increased political ambitions. But he was arrested in 2003 when special forces stormed onto his private plane and spent a decade in prison on convictions of tax evasion and embezzlement before Putin pardoned him and he left Russia.

I remember reading an article where one of the oligarchs shut down a factory and there was great protest. Putin not only forced the oligarch to re-open the factory, he was there when the oligarch made the announcement, glaring at him and treating him with contempt.

The oligarchs are not in control of Putin or the Russian government (though they have some influence at the provincial and civic levels.)

Now the AP article points out something very smart: that Putin is creating a new group of oligarchs loyal to him, by giving them resources seized from foreign countries leaving Europe. Smart to notice, and smart of Putin, though his successors may regret it. In a way this is very similar to feudalism, though it involves money and resources not armed men and land.

The new oligarchs will be loyal to Putin and probably this successor. Their children may well not be loyal to Putin’s successor’s successor, however, and that person will have to show the whip hand or cut a deal, or both. If they ever succeed in taking control of the government (and they will eventually if the system continues) then it will be very bad for Russians, same as oligarchic control of the US has been very bad for Americans. A “King” often uses the commons against the nobility and thus supports the commons to some extent, a king who is ruled by the nobles acts with them against the commoners.

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Let’s add another data point: Russia has vastly ramped up its military production. The US could not do so, the companies who make the weapons said they’d do it, but have been very slow about it because they make more money that way. In Russia, however, in 2022, Medvedev, Putin’s lieutenant stated:

“The goal has been set for a scrupulous execution of the government’s defense contracts in all of its key parameters, [and] prevention of disruptions in the supply of equipment,” he wrote on Telegram. “Attention has been drawn to the fact that all contractors could be held to account, including on criminal charges… Supervision over the execution will continue.”

Although I can’t find it, in another case he gathered them together and explained to them what Stalin did to those who didn’t make production quotas.

You can’t get clearer, or more threatening than that.

Russia’s weapon manufacturers serve the state. They make a profit and those who run them are allowed to become rich, but only if they meet their quotas.

Russia is a modern imperial system, similar to the early Roman one. The governors are hand chosen by Putin from his loyalists (he likes ex-bodyguards) and the bourgeoisie serve him. When Wagner rebelled, not one governor supported their rebellion, even in the first 24 hours when they seemed to be doing well.

America is an oligarchy, Russia has an emperor. The emperor is old, and the question is who will be his successor, which is why key lieutenants like Medvedev and Kadyrov (the governor of Chechnya) are competing in loyalty and fervor.

Both countries have elections, in both countries the elections have little effect most of the time, though their existence does allow the possibility of change thru them. In America, the leader changes, but since Reagan, the fundamental policies haven’t. In Russia, well, Putin is always re-elected, though it is also true that he has always been popular in Russia, with his opposition a minority.

Indeed, that opposition, largely urban professional types, are weaker now than ever, with many of them leaving Russia due to the war.

Putin, like the kings we discussed above, uses the commons against the nobility, to help keep them in check. He does care about his popularity.

So, again, the US is a nominal democracy which is actually a plutocratic oligarchy, and Russia is a nominal democracy which is actually an imperial system without family succession.

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From 2010: The Unvarnished Truth About the US

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On June 15, 2022

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Twelve years ago, I wrote this post. I don’t see anything since then has changed to make it wrong, and I think it’s worth reading still — especially for those who weren’t with me 12 years ago.

I’ve been meaning to write this post for some time, and in light of yesterday’s Supreme Court decision allowing unlimited corporate money into the political system, I think it’s time.

Yesterday’s decision makes the US a soft fascist state. Roosevelt’s definition of fascism was control of government by corporate interests. Unlimited money means that private interests can dump billions into elections if they choose. Given that the government can, will, and has rewarded them with trillions, as in the bailouts, or is thinking about doing so in HCR, by forcing millions of Americans to buy their products, the return on investment is so good that I would argue that corporations have a fiduciary duty to their shareholders to buy out government – after all, if you pay a million to get a billion, or a billion to get a trillion, that’s far far better returns than are available anywhere else.

And no politician, no political party, can reasonably expect to win when billions of dollars are arrayed against it.

The one faint hope is that politicians in the Senate will panic, know they have ten months to do something, and ram something through. Of course, that will only be a stopgap measure, until the Supremes overthrow it, but in the meantime, maybe Dems will get serious about the Supreme Court and stop rubber-stamping radical right-wingers like Alito and Roberts.

That is, however, a faint hope.

Given the US’s complete inability to manage its economic affairs, and its refusal to fix its profound structural problems, whether in the financial system, the education system, the military, concrete infrastructure, technology, or anything else, I cannot see a likely scenario where the US turns things around. The US’s problems in almost every area amount to “monied interests are making a killing on business as usual, and ologopolistic markets and will do anything they can to make sure the problem isn’t fixed.”

Even before they had the ability to dump unlimited money into the political system, they virtually controlled Washington. This will put their influence on steroids. Any congressperson who goes against their interests can be threatened by what amounts to unlimited money. And any one who does their bidding can be rewarded with so much money their reelection is virtually secure.

This decision makes the US’s recovery from its decline even more unlikely than before — and before it was still very unlikely. Absolute catastrophe will have to occur before people are angry enough and corporations weak enough for there to even be a chance.

So, my advice to my readers is this.

If you can leave the US, do. Most of the world is going to suffer over the next decades, but there are places which will suffer less than the US: places that have not settled for soft fascism and are refusing to fix their economic problems. Fighting to the very end is romantic, and all, but when you’re outnumbered, outgunned, and your odds of winning are miniscule, sometimes the smartest thing to do is book out. Those who immigrated to the US understood this; they left countries which were less free or had less economic hope than the US, and they came to a place where freedom and opportunity reigned.

That place, that time, is coming to an end. For your own sake, and especially for the sake of your children, I tell you now — it is time to get out.

I am not the only person thinking this. Even before the decisions, two of my savviest American friends, people with impeccable records at predicting the US meltdown, told me that within the next few years they would be leaving.

There’s always hope, and those who choose to stay might stop this terminal decline.

But you need to ask yourself, seriously, if you are willing to pay the price of failure, if you are willing to have your children pay the price of failure. Because it will be very, very steep.

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Who Wins and Loses Because of the Ukraine War?

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On May 16, 2022

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I’m basing this on current trends and what I see as the most likely outcome.

Russia will take about 30% to 40% of Ukraine: the East and the coast along the Black Sea, areas that are generally Russian ethnic or speaking. While they were pushed back from Kharkiv, I think they’ll take the Oblast by the end of the war. Basically, see where Russians are the majority and that’s the land that Russia will feel it can keep and not fight an endless guerilla war.

They make have to take more land than that to force a peace on terms they can stand, but they won’t want to keep it because everyone knows the West is trying to draw them into a long term guerilla war. (Such a war could be won in Ukraine because of the terrain, but doing so would require a lot of killing, deportatons and camps and many years. It’s not worth it for Russia.)

The Russians original goals will not be met, and Finland and Sweden will joint NATO (although they were already quite integrated), so in one sense it can be said that Russia has “lost”. In certain other senses it can be said to win.

But let’s look at the major players, one by one.

Ukraine: the big loser. Unless this war goes far different than I expect (possible and I’ll admit it if it does) they’re going to come out of it a smaller country with no coast, who has lost their industrial heartland and even if the gas is turned back on, they will lose most of the transit fees in a couple years max as the EU transitions away. They will find that the “rebuilding” they were promised is IMF style neoliberalism and the average person will wind up worse off.

Verdict: Disastrous Loss.

The EU: In the win column, the EU should have built up a larger military long ago and will now do so. They will be more unified, at least initially, feeling they have all supported a war and with fear of Russia acting as unifying glue.

In the lost column they have firmly moved into the US satrapy column. In order to move out they would have to create their own army that is not dependent on US built military equipment and that’s the opposite of what they’re doing. (Foolish, because the US is losing its ability to build either ships or combat planes. The F-35 was a boondogle, Boeing has lost its engineering chops, and they recently decided to decommission built ships because they are so bad.)

The increase in price of fuel (US gas is about 50% more expensive than Russian), commodities and food as well as the general inflation shock from the Ukraine war will lead to a poorer Europe. Spending more money on the military will make ordinary people feel worse off and so will inflation. Industry will be badly damaged by increased fuel and mineral prices. All of this will lead to increased political instability and is likely to help the fascist right and possible the more radical left (if the left ever gets its act together.)

Joining the US in such huge sanctions and seizing Russia’s reserves (“frozen”) means that they are choosing to join the US side of the new cold war world rather than being a third pole, and this will eventually limit their trade options, as they, like the US, cannot be trusted with money.

The EU is, overall, likely to come out of this war poorer, more isolated and with increased political instability, but with a much larger military and feeling more unified at the elite and country to country level (at least until and if political instability changes that.)

Veridict: Slight Loss.

The US: The US has gotten Europe firmly back as a satrapy. NATO expands, the Europeans will spend more more on US military goods and buy expensive US gas and oil. The possibility of Europe becoming independent and forming a third pole in the upcoming cold war between the US and China is now minimal, and essentially zero for at least a decade or two.

On the negative side, Russia is now firmly in the Chinese sphere. Because the US’s strategy in the case of a war with China would be to strangle China with a military enforced trade embargo, this is a big problem. Russia can supply China with massive amounts of food, fuel and commodities, making the “choke them out” strategy against China unlikely to succeed. Likewise a friendly Russia means China has a relatively secure flank to the Northwest. There are even signs of Chinese-Indian rapprochement, and though I’ll believe it when I see it, India not joining against China would be a huge boon to China.

Since China is the “real” threat, not Russia, the one country that can replace the US as the world’s most powerful nation, strengthening China’s position is a loss.

The US also will suffer due to inflation from knock on effects of the Ukraine war, and that will cause increased domestic instability. Elites continue to funnel massive money to the domestic security apparatus (police of various varieties, spies who target US residents), however, and elites feel fairly secure, though I think they’re wrong as they’re funneling resources to police who stand a good chance of joining a right wing uprising.

The final major effect for the US is that freezing Russian reserves and encouraging the massive level of sanctions, is seen by most of the world as evidence it’s not safe to keep money in the US lead banking system, or even to trade with them. This has accelerated de-dollarization and I suspect will be seen as the precipitating event of losing reserve status for the American dollar. The world will split into two financial blocs, one centered around China-Russia, the other around the US-EU. The US receives huge benefits from reserve status and from being at the center of the world financial system, and as with Britain after WWI, it will suffer mightily when it loses this position.

My evaluation is that what the US will likely gain from the Ukraine war is less than it has or will lose: dollar hegemony and being the financial center of the world are a big deal, and confirming Russia as a junior Chinese ally makes their main geopolitical rival far stronger.

Verdict: Loss

Russia: Russia has weathered the initial economic storm well, but most EU countries will move off Russian gas and oil. Some of that gas and oil cannot be brought to market anywhere else for a few years (probably 3) until new pipelines are built and while there are customers, they will pay less than the Europeans did.

Sanctions will not cripple Russia, but there are goods like advanced semiconductors and, more importantly, some tech needed for gas and oil extraction, that they will be cut off from. China cannot immediately replace those oil and gas related goods, and they are at least ten years behind in semiconductors (and themselves cut off from some key capital equipment they can’t yet build). That said the oil and gas tech is probably within quicker reach, and Russia doesn’t need the most advanced semiconductors in large quantities so far as I know.

In most economic terms Russia will be OK: they have a big food surplus; they have more than enough fuel, of course, and they can buy almost everything they don’t make from China, who is not going to cut them off; indeed, rather the reverse. India is also rushing to cut deals with Russian businesses. Sanctions will force more import substitution and help overcome the “resource curse”, making it cost-effective to make more things in Russia (if they aren’t overwhelmed by cheap Chinese goods.)

Sanctions will not cripple Russia the way they have many other countries, though they will be felt. Nor will they cause a revolution and if there is a coup it will be because Putin is old now and may be ill with Parkinsons or something else.

In territorial terms Russia likely to wind up larger. They get the industrial part of Ukraine and the coast, they can send water to Crimea (which has been cut off from years, and whose agriculture was devastated as a result) and while many will say they didn’t win the war, etc… people who want to stand up to them will not be keen on “winning and losing 30% of our country.” If that’s victory, it looks pretty bad.

A unified Europe with more countries in NATO and a bigger military is a loss for Russia, and one can expect that NATO will move more missiles and ABMS close to the Russian border, including hypersonic missiles as soon as they have them. In that sense the war is a clear loss: Russia wanted those weapons removed from near its border, and there will probably be even more of them.

In the end Russia will be able to credibly claim it won the war as a war: it took territory and kept it and it’s hard to say that a country which took its enemy’s territory lost a war. That said, there will be a case that it is a Pyrrhic victory, in that there is an economic hit, NATO has expanded, Europe will have a bigger military and so on.

The counter-case is simple: Ukraine was talking about getting nukes and had started shelling Donetsk in what looked like a prelude to invasion. Russia didn’t get its maximal goals, but it did gut Ukraine as a threat and did secure Ukrainian land in what is likely to be a semi-permanent fashion absent an all out NATO/Russia war.

The maximal goals didn’t happen, but in a bad situation Russia may reasonably claim it got quite a bit. As for sanctions, every year there had been more of them, none had ever been rescinded and all the war did was move them up.

Verdict: Marginal victory.

China: Yes, strictly speaking China isn’t involved in the war, but the war affects China greatly. China needs about 10 years to get to a reasonable parity with the US in semiconductors and aviation, the golden technologies of US hegemonic rule. The Ukraine war has made it clear they probably have less time than that, and that the world economic order is likely to split sooner because China is stuck between US demands to support sanctions and its own strategic needs, which require Russia as an ally, or at least a reliable supplier. Russia being decisively defeated or economically crushed would be catastrophic for China, so they must keep it alive and viable.

Still, all in all having Russia unable to sell to or buy from the West is unbelievably good for China: there is no alternative for Russia. If they can’t go to the West they must go to China. India may be willing to trade, but India’s economy is tiny compared to China’s and its industry scarce. China can make almost everything Russia needs and everything it can’t make it’s working on learning how to make. And, as previously discussed, Russia as an ally makes it impossible for the US to choke China out in a war.

Verdict: Victory

Concluding Remarks: Of course all of this based on a model of how they war will go which may not be the case. Perhaps the maximalists in the West are right, and the Russian military is fundamentally incompetent, can’t do logistics to a disastrous degree, and is on the verge of collapse. If you think Russia can’t even win the conventional war, all of this is is nonsense because a definite loss is likely to lead to regime change and possibly even collapse.

Likewise if you think that sanctions will have much more effect than I do, or that China will not integrate with Russia economically, then this is all wrong.

But overall, this war looks like a case where Russia gets a marginal victory; the US and the EU get some wins but their victories are effectively Pyrrhic, and China is the big winner.

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Stopping Sinema and Manchin From Electing Donald Trump

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On October 22, 2021

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So, these two Senators, between them, have managed to absolutely gut all of Biden’s signature efforts, from climate change to helping people in need.

It is days like this where one wishes LBJ was President.

Progressives have tried bargaining with them and failed, repeatedly.

Fine.

The way to handle them is simply to find something they care about and kill it. Progressives also have veto power (in the House in particular.) Then find something else and kill that. Then kill something else.

As for Biden, well, Manchin’s family has a coal company, I bet he cares about that and I bet they’ve been doing things that regulators would find illegal if they weren’t off limits. It’s probably time for the EPA, IRS and every other three letter agency to crawl over every piece of business Manchin does. Sinema seems less vulnerable, but you never know.

Then have a little private chat with them about their futures. You need them both to stop obstructing, and to stay in the party, though Sinema is one term Senator who will lose her next primary.

If you aren’t willing or able to do either of these things (and notice that Sinema and Manchin have killed many things progressives care about) then just shut up and go home, because you either have no power or no willingness to use it.

I would guess that Sinema and Manchin, between them, are costing Biden his second term. People will look back on Trump and notice he actually was able to pass larger bills helping them in their time of need.

I imagine Trump is looking forward to his second term, courtesy of Sinema and Manchin, and those who will not oppose them.

(My writing helps pay my rent and buys me food. So please consider subscribing or donating if you like my writing.)

Democratic Congress Members Want What Republicans Want

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On June 16, 2021

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So, here we have it:

On Hugh Hewitt’s show, McConnell says it’s “highly unlikely” he’d allow Biden to fill a Supreme Court vacancy in 2024, if he’s majority leader. He also doesn’t commit to allowing a vote on a nominee if a seat opens up in 2023. “Well, we’d have to wait and see what happens.”

This is the new normal. Republicans get all of their Supreme Court slots and stop any Democratic slots they can. We should note that McConnell was also keeping most appellate seats open, which is why Trump was able to appoint so many.

Republicans will do virtually anything to win. They will change voting laws. They will put one voting machine in a poor or minority district of a million people. They will forbid voting by mail and then try not to count the votes.

Democrats, with rare exceptions, do not fight back. When they get in power, they do the minimum.

I hear the cries, “But Biden has only 50 people in the Senate!”

Yes, just like Obama had only 60 and somehow couldn’t pass anything, “because Republicans.” There’s always a designated villain, a kabuki vote: These days it is Manchin, with Sinema as backup. But if they weren’t taking the heat, others would step up. Senate Dems are okay with not passing anything on 50 votes, even if they could. They don’t want to.

Biden had a good economic plan, but it has been watered down to basic worthlessness, and certainly won’t do much for the environment.

The test for Biden’s sincerity is simple: The President has vast executive power. Is the President using it? Biden has vast power to forbid fracking; he didn’t. He has allowed vast increases in oil pumping. He could cancel or reduce student loans on his say-so. He has not.

Louis DeJoy deliberately sandbagged the Post Office as part of an attempt to steal the election. He is elected by the post-office board, yes, but Biden can fire him for cause. He hasn’t done so, just as in 2009, Obama could have fired every member of the Federal Reserve except the chairman (who has only one vote anyway.)

Republicans do things Democrats want: They cut taxes for rich people like Nancy Pelosi and most Senators and their families, for example. They bomb brown people. The hurt poor people.

The Democrats who are in power like all these things. They tell you they don’t, then when they have power, they reverse hardly any of it, and indeed, add to the pile of evil.

Anyway: The Republicans already have six seats on the Supreme Court. They’re going to keep them, and may wind up with seven. The appellate courts will continue to trend heavily Republican, and with people appointed by Trump and his successor — radical right-wingers.

The reason I bring this up is to emphasize, again, that while it is possible for the US to turn-around from its current path, the signs are not good. The main chance will come when people like Pelosi resign, too feeble and old to cling to power. But given how hard they are clinging to power and that they will choose the worst people to succeed them if possible, that chance seems dim.

Take this into account as you make your plans. This is as true for non-Americans as it is for Americans, as the US is still the hegemonic power.

And if you are left-wing, remember that multiple states are making it legal to run over protesters. The right-wing wants to kill you. To kill you. To kill you.

Understand that in your bones. They want you dead.

(My writing helps pay my rent and buys me food. So please consider subscribing or donating if you like my writing.)

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