(Map of Ukraine and surrounding areas; http://www.globalresearch.ca/donbass-and-the-big-game-reformatting-ukraine-is-on-the-agenda-russia-will-not-remain-on-the-sidelines/5453465)

The Donbas Rift

By Serhiy Kudelia, Assistant Professor of Political Science at Baylor University

Russian Politics and Law (journal), Volume 54, No, 1, 2016

 

Professor Kudelia’s in-depth report on the evolution of the Donbas rebellion in the winter of 2013-2014 in Ukraine generally follows the basic outline set out in my previous writings about the nature of the Ukraine conflict.  However, it also provides some additional facts and nuance.

One valuable point that Kudelia underscores is that the oligarchs of the Donbas region of southeastern Ukraine “hedged their bets” by trying to deal with both the coup government in Kiev and its representatives as well as the rebels in Donbas.  This was a contributing factor in how the Donbas rebels were able to establish their power, increasingly independent of Kiev’s governance.

After the Euromaidan victory, the Party of Regions’ [Yanukovich’s party] public statements were limited to demands that greater power be given to local authorities and that the rights of Russian-speaking people be protected. However, the sudden departure of Yanukovych and his supporters led the party to disintegrate into several factions associated with large business groups (e.g., Rinat Akhmetov, Dmitry Firtash, and Alexander Efremov). Each of these groups had its own interests in the Donbas; some were more insistent than others, and made tacit alliances with separatist leaders.

Another fact elaborated on is the role played by members of the security forces who lived in Donbas, many of whom had worked security on the Maidan, and considered the new Kiev government to have risen to power in a violent coup, in supporting the rebels:

If initially the majority of these groups were composed of activists of local pro-Russian organizations and “Cossacks,” by March they were joined by sympathizers that included former Afghan veterans and recently active Ukrainian law enforcement officers. Alexander Khodakovsky, future commander of the militia battalion Vostok, headed the Donetsk SBU special unit Alfa and took part in the storming of the Trade Union House, which was the headquarters of Euromaidan. His example was followed by many from the ranks of the Donetsk and Luhansk Berkut, who underwent more than one rotation at the Maidan- some were afraid of being prosecuted by of the new government, others were out for revenge. Local militias were being joined by former anti-Maidan activists, who returned from Kyiv with new experiences of violent struggle. As a result, a partisan core that would become the epicenter of the military phase of the confrontation began to form in the Donbas.

….Leaders of some Donbas cities assisted in organizing regular meetings under Soviet and Russian flags. Later these urban leaders helped to organize the May 11 referendum. These meetings and the “people’s guards” were financed by local businesses operating under the protection of bosses from the Party of Regions…. At the same time, the heads of local police departments and SBU offices (who were part of the patronage network of the Party of Regions) did not obstruct the development of the separatist movement. In fact, the majority of law enforcement authorities ceased to function, and seizures of law enforcement agencies were committed with their sanction or direct assistance. For example, during the storming of the Luhansk SBU, the police refused to protect the building, while the head of Internal Affairs insisted on the need to release the detained separatist leaders.11 According to Alexander Petrulevich, the former head of the Luhansk SBU, most police officers in the region came out of [working on the] Maidan “with resentment and bruised psyches, plus they were all threatened with criminal prosecution.”

Kudelia states that there were numerous “miscalculations” by the Kiev regime that created conditions conducive to rebels consolidating their local power.  Furthermore, Russia reacted to facts on the ground to support its own perceived interests but was not the cause.

Russia exploited these developments, but did not play a determining role in them….Kremlin and Russian agents did not act in a vacuum.  The space for these events was largely created by events inside Ukraine, which were not only outside the direct control of Moscow, but often ran counter to the interests of the Russian leadership.

The events referenced above include the hijacking of the Maidan movement by the ultra-nationalist forces who utilized violence, beginning on February 18^, 2014, with the march down Institutskaya Street in Kiev, which was initially billed as a “peaceful offensive” on the Rada (parliament); the inability or unwillingness of the rest of the Maidan movement to keep the protests peaceful; the rejection by those same violent extremists of the agreement negotiated by Poland, Germany and France with the Yanukovich government that called for early elections and a devolution of power; and, the subsequent violence against the rebels by the new government of Kiev.

Kudelia states that the new Kiev government did make an attempt to negotiate with the rebels.  However, one is left to wonder how seriously this was supposed to be taken by the rebels when one of the two men that Kiev sent for this purpose was Neo-Nazi activist Andrey Parubiy, who participated in the violence of the Maidan (The other was deputy prime minister, Vitaly Yarema).  This attempt at negotiation occurred only after the Donbas cities of Donetsk and Luhansk had successfully held a referendum calling for self-determination.  This was viewed as a bargaining chip to gain as much “home rule,” as Professor Stephen F. Cohen calls it, as possible.

Interestingly, Kudelia does not go into any detail about the violence of February 20th to the 22nd that directly led to the ousting of Yanukovich – the sniper attacks on the Maidan that killed nearly 100 people, both protesters and police.  The most thorough forensic investigation of the sniper attacks to date, has been the work of Dr. Ivan Katchanovski, a professor of Political Studies at the University of Ottawa.

Kudelia also explains that the Kiev government’s initial strategy of focusing its “Anti-Terrorist Operation” (ATO) on the city of Slavyansk also provided space for the development of what would become the Donetsk People’s Republic and the Luhansk People’s Republic.

Kudelia also reinforces what academic specialist Nicolai Petro, who was in Ukraine at the time of the upheaval in 2013-2014, pointed out:  that majorities of Donbas residents polled in April 2014 saw the new Kiev government as illegitimate and believed the Neo-Nazi Right Sector was a powerful and threatening organization.  These views, presumably along with reports of proposals in the Rada threatening the Russian language and anti-Maidan protesters being beaten and harassed on their return to southeast Ukraine and Crimea, culminated in the creation of local “paramilitary organizations” in the Donbas, similar to the ones formed in Crimea in order to defend their respective populations.

He also states that the rebellion originally called for federalization, with only a minority calling for an independent Novorossiya.  These calls would understandably increase later on, after months of  Kiev’s ATO against the Donbas, which included shelling civilian neighborhoods and unleashing vicious Neo-Nazi battalions to compensate for the lack of stomach many Ukrainian Army recruits had for attacking their fellow Ukrainians.

Rallies in support of federalizing Ukraine were held in most major cities in the Southeast. However, the Donbas was the only region where Kyiv was unable to regain control and prevent the outbreak of an armed movement to join Donetsk and Luhansk regions to Russia. This was facilitated by three factors.  First, the Donbas was significantly different from other regions in terms of its politics and its level of integration into the Ukrainian state. In contrast to all other regions, the majority has traditionally supported the unification of Ukraine with Russia (66 percent) and regretted the collapse of the Soviet Union (61 percent).7 In April 2014, after Russia’s annexation of Crimea, almost two-thirds of the region’s residents continued to express a positive attitude toward Russian president Vladimir Putin, while in other regions the level of support was no higher than 20 percent. With the exception of Crimea, the Donbas was the only territory where a majority (57 percent in 2013) stated that it would not support the independence of Ukraine in the case of a second referendum (i.e., the 1991 referendum, when nearly 84 percent voted in favor of independence).8 While before the revolution few people supported separatism (8 percent in 2012), recognition of the the Ukrainian government was conditional. This is evidenced by the prevalence among Donbas residents of a regional identity-in contrast to other Ukrainian regions, Donbas residents primarily identify themselves with their city or region, rather than with the state as a whole.

It is recognized that the historical ethnic ties of Donbas to Russia – since the 19th century, much of the area had been populated by Russian settlers after coal mining was established –  fueled its having the highest “animosity toward Ukrainian nationalists,” who are stridently, even violently, anti-Russian.  This made the Donbas population particularly sensitive to news reports from Russia of the actions taking place during and after the Maidan protests.

Kudelia’s analysis reinforces what I and other analysts have argued for some time: 1) there was broad and authentic native support for the Donbas rebellion, and 2) an independent Donbas would not be in the Kremlin’s interests as it would remove the block of the population of Ukraine that would serve as a counterweight to anti-Russian sentiment, right-wing extremism and NATO membership.  Moreover, it is unlikely that Russia would want to have to deal with an economically non-viable state on its border or to expend the resources necessary to bring the Donbas into Russia – not to mention the further aggravation it would create in Russia’s relations with the west.

In short, the coup government in Kiev seriously miscalculated the depth of resistance they would be facing in the Donbas and thousands of people have paid a horrible price.  Russia has provided military, political and diplomatic support to ensure the rebels are not defeated or wiped out by Kiev, but are granted sufficient autonomy within the Ukrainian state as is reflected in the Minsk Agreement. Russia did not create the problem, nor is there any evidence that Russia desires or supports actual separatism, which would not be in their interests.  In fact, their actions point in a different direction as is reflected in its facilitating the replacement of Igor Strelkov and Alexander Borodai, who advocated the Novorossiya project of an independent Donbas, perhaps eventually united with Russia, with leaders more amenable to negotiation with Kiev.

As reported at The Duran, James Clapper, Director of U.S. National Intelligence, has publicly acknowledged that the identity of the hacker of the DNC’s email server has not been definitively established and even expressed surprise at the hyperbolic characterization of the story by the press:

Clapper did not say Russia was behind the leak.  Though he did not clear Russia, he says US intelligence has not yet established the identity of the hacker.   He says that there was nothing especially difficult or complex about the hack, meaning that any of many parties could have done it.  He has pointed out that both the US and Russia routinely hack each other, and that they have been engaged in this sort of thing ever since the start of the Cold War, and that only “the tools have changed”.  He says he is “taken aback” by all the “hyperventilation” that has surrounded the story.

This reiterates some of the main points made by Glenn Greenwald in an interview last week with CNN:

This is all effectively serving as a classic and convenient means of misdirection, distracting attention away from the content of the hacked emails which cast a dark shadow on the Democratic Party’s antics during the primary.  And using the well-established bogeyman Putin, to boot.

The editors of The Nation have expressed concern at the McCarthyist era style of smearing at work in this manner of deflecting attention away from the real scandal implied in the emails:

Let us recall that McCarthyism impugned the loyalty of American citizens by accusing them of allegiance to the Soviet Union. This political defamation—often a joint undertaking of Congress and the media—suppressed democratic debate over alternative policies and ideas, and in the process destroyed lives by stigmatizing those whose views were deemed insufficiently loyal to Cold War–era orthodoxies. The overall effect was to poison, chill, and censor the political discourse of the nation.

….While Trump himself has hardly been damaged by today’s revival of McCarthyism, the same cannot be said for our national debate. Over the past month alone, establishment voices like Franklin Foer, Paul Krugman, Jeffrey Goldberg, Josh Marshall, and Jonathan Chait, among others, have Kremlin-baited Trump in lieu of reasoned argument and factual critique. On July 21, The Atlantic’s Goldberg informed readers that “The Republican nominee for president, Donald J. Trump, has chosen this week to unmask himself as a de facto agent of Russian President Vladimir Putin.” Krugman followed this up on July 22 by asking in The New York Times: “If elected, would Donald Trump be Vladimir Putin’s man in the White House?” Krugman then answered his own baseless question: “Mr. Trump would, in office, actually follow a pro-Putin foreign policy, at the expense of America’s allies and her own self-interest.”

….This neo-McCarthyism now threatens to derail a vital debate over the substance of the 20,000-plus e-mails, made public by WikiLeaks on July 22, that reveal the purportedly neutral Democratic National Committee’s derision and contempt for Senator Bernie Sanders’s campaign—as well as several aborted attempts to tip the scales against him. While the FBI has launched an investigation, as of press time, nobody has conclusively proven who hacked into the DNC’s network, much less demonstrated what their motives were. But that didn’t stop Clinton campaign manager Robby Mook from appearing on CNN on July 24 to allege that Russia was behind the hack. “Sources are saying the Russians are releasing these e-mails for the purpose of actually helping Donald Trump,” said Mook. To no one’s great surprise, he neglected to tell CNN who his sources were. Nevertheless, liberal-media elites have joined with the Clinton campaign in promoting the narrative of a devious Russian cyber-attack, which Fairness and Accuracy in Reporting’s Adam Johnson correctly points out “is being used to outweigh the damning substance of the leak itself.”

 

Since the collapse of the Soviet Union, much has been written about “the Russian idea.”  Subsumed under this term are the very issues – moral, religious, and national/cultural – that [Dmitrii] Merezhkoskii treated in the works we have discussed.  In a replay of the fin de siecle, Russians are again discussing how to make Christianity relevant to life in this world, Christian attitudes toward sex, Christian art, and the proper relation of church and state.  They are trying to define a postcommunist Russian identity and to find the organizing principles by which they can reconstruct their world.

(page 143, Merezhkovskii’s Readings of Tolstoi by Bernice Glatzer Rosenthal)

Russian Thought After Communism: The Recovery of a Philosophical Heritage is a book of essays by various contributors (edited by James P. Scanlan), published in 1994, elaborating on the work and thought of several Russian philosophers of the pre-Soviet era and how this heritage is influencing the post-Soviet era. Rosenthal’s essay is about Dmitrii Merezhkovskii, who was a philosopher, playright, historical novelist and literary critic.  He was active in the years just prior to and during Russia’s revolutions of the early 20th century and focused much of his attention on the thought and work of the great Russian literary writers, namely Fyodor Dostoevsky and Leo Tolstoy.  However, the focus over the years would center on Tolstoy to the point of near obsession, representing a complex – often contradictory – assessment of whether Tolstoy was a prophetic saint or a nihilistic hypocrite.

Around 1900, he published a study and contrast of the two preeminent novelists, Tolstoi and Dostoyevskii, LIfe and Art.  A Study.  With a deep interest in morality and Christianity, Merezhkovskii believed that literature – which, at its best, can serve as a vehicle for exploring important moral and philosophical issues in all of their complexity and nuance – should be a guiding force in the inevitable choice between good and evil.  He was correct that Russians were about to face a momentous choice of paths to follow in the form of reform versus communist revolution.  Merezhkovskii believed that communism, particularly the Bolshevik manifestation, was the equivalent of evil, largely due to its atheism and repression of religion and spirituality.

Merezhkovskii’s apocalyptic Christianity was said to be a reaction to Nietzsche’s “God is dead” nihilism with Jesus serving in Merezhkovskii’s mind as the countervailing “Superman” who would return to earth offering a “Third Testament” that would reconcile paganism with Christianity and the spiritual with the earthly life.

In this study, Merezhkovskii held Dostoyevsky in high regard and “deconstructed” Tolstoy as having a “slave morality” and conducted a lengthy contrast between Tolstoy and the poet Pushkin, whom Merezhkovksii lionized, stating that where Pushkin represented harmony, successful integration of artist and intellectual, and reconciliation of the cultured man and the proud Russian, Tolstoy represented “rupture,” emotional and spiritual dearth, and advocacy of an “abstract cosmopolitanism” that rejected Russian patriotism.

He criticized Tolstoy’s characters for being passive contemplators and victims rather than heroes with a sense of agency.  He also expressed disdain for what he saw as Tolstoy’s “rational Christianity” lacking any sense of the mystical, mysterious or experiential, and attributed these shortcomings to a profound fear of death on Tolstoy’s part.  This fear, Merezhkovskii claimed, prompted him to view man’s relationship to God as “the criminal sentenced to death, and God is the executioner.” (p. 128)

Merezhkovskii also felt Tolstoy did not have a proper appreciation of the cause and effect patterns of history, stating “his Christianity did not grow from Russian or west European soil but fell from the heavens already prepared.” (p. 129)

Merezhkovskii’s views of Tolstoy would evolve over the years with Tolstoy’s excommunication by the Holy Synod of the Orthodox Church in 1901.  By 1905, Merezhkovskii’s religious and political views had changed in a way that made them compatible with a re-examination of Tolstoy.  Advocating “religious revolution,” Merezhkovskii now recast Tolstoy as “a prophet of Christian anarchism” but criticized his rejection of the 1905 revolution (which decreased the Czar’s rule from that of an autocrat, at least on paper), and Dostoyevsky was now “a prophet of the Russian Revolution” but open to criticism for his theocracy. (p. 131)

As disillusionment with the 1905 revolution in the areas of society and culture set in, Merezhkovskii saw Tolstoy’s doctrinaire moralism no longer with disdain but with qualified acceptance.

A common theme in Russian philosophy of the 19th and early 20th century involved trying to reconcile difference forces and influences.  To some extent, these are universal concerns for most cultures at various points in their development, but for Russia, it is perhaps even more so due to the nation’s particular geography, climate and history.  The country is vast, situated between the West (represented by Europe) and the East (represented by Asia), multiethnic and multiconfessional, with a history filled with foreign invasions, natural disasters, and social upheaval that creates a yearning for security and stability.

After 70 years of relative cultural and philosophical stagnation under the Soviet system, Russians find they are grappling with many of the same issues that their pre-Soviet thinkers did with respect to religion, culture and the nature of the state.  Consequently, they have been getting reacquainted with these thinkers over the past 25 years.  Much has been made among the usual western pundits who have little depth of understanding when it comes to Russia, yet sally forth onto the pages of western newspapers and magazines anyway, about Vladimir Putin’s assignment of the works of 3 pre-Soviet Russian philosophers to be read by all the regional governors during the 2014 Winter holiday.  Those 3 philosophers were Vladimir Solovyev, Nikolai Berdyaev, and Ivan Ilyin.  This book includes essays dealing with all 3 of those philosophers and, due to their contemporary relevance to Russian political thought, the remainder of this review will focus on them.

Vladimir Solovyev

Solovyev has been categorized as one of the early Slavophiles, along with Ivan Kirveevskii, Alexei Khomiakov, and Nicolai Fedorov who were considered trailblazers of Russian philosophy in general.  The basic elements that underpinned early Slavophile philosophy included being pioneers of a philosophy that was unique and original to Russia, fitting with its culture and experience.

Pre-Slavophile Russian philosophers are typically ignored or dismissed by the Slavophiles, according to Scanlan, as being too heavily influenced by external intellectual forces.

Scanlan cites Russian philosophy expert,  Zinaida Smirnova, in pointing out that Slavophiles accepted some “bourgeoisie tendencies” like free speech and free hired labor, but opposed bourgeoisie views of absolute private property ownership, condemned individualist orientation and alienation, and advocated social ties based on custom rather than contract, law or constitutionalism. (p. 38)

To some degree, these preferences can still be seen in contemporary Russia in which surveys reflect majorities supporting socioeconomic equality over individual success and a nuanced but prominent role for religion in society compared to the more strident secularism and relativist values of the West.

As Andrey Shirin, assistant professor of divinity at the John Leland Center for Theological Studies, recently explained:

Of course, by and large, Russians appreciate the newfound individual freedoms and opportunities afforded by the influence of Western values.  Nevertheless, to many in Russia these individual callings can find a sense of completion only in a larger communal context.

As a consequence of these values, Slavophiles revered the Russian village commune as a model institution rooted in an authentic collectivist tradition – appropriate to Russia at the time as the rural Russian village life was not yet perceived to be tainted by money, capitalism and industrialization.

Slavophiles also believed in sobornost or the universal, mystical nature of the Orthodox Church – often rejecting or struggling to reconcile with “rationalist” approaches to theology.

However, in the case of Solovyev’s Slavophilism, it appears to be more complicated.  He acknowledged the intuitive as well as the rational. He was friends with Dostoyevsky but had disagreements over Orthodoxy since Solovyev was an advocate of ecumenism and healing the schism between Orthodoxy and Catholicism.  Furthermore, he is credited with influencing Nicolai Berdyaev, Rudolf Steiner and the Russian Symbolists, among others.  He admired the Greek goddess Sophia who he characterized as the “merciful unifying feminine wisdom of God.”  Solovyev was adept at integrating several spiritual strands, such as Greek philosophy, Buddhism, Kabbalah, and Christian Gnosticism.

His view of sobornost was that it was an organic and spontaneous order through integration.  He believed that all bodies of knowledge and disciplines of thought could be reconciled through logic, reason and fusing all concepts into a single system.

Solovyev’s debates with his Slavophile contemporary, Fedorov, highlight his views on the nature of spirituality and integration – believing that humans needed to recognize that they were a part of nature and seeking to elevate spiritual development within the world as opposed to Fedorov’s inclination toward wanting to control nature via technological fixes such as cloning and conquering death through the literal resurrection of the dead.

As one of the book’s essayists, George M. Young, Jr., points out, the debates between Solovyev and Fedorov reflect issues and questions that are just as relevant today:

What happens if technology outpaces morality?  Should we permit some people to enjoy extreme longevity, even approach immortality, while others die after a “natural” span of years?  Can a democratic society undertake a task as grandiose as the resurrection of the dead, or must there be a benevolent autocrat to set and keep us on the long project?  What is the point of space exploration when so many problems exist on earth?

….How much control should man attempt to exert over nature?  How do we alter one part of an ecological system to our benefit without altering other parts to our detriment?  If we insist on individual freedom, what are the alternatives to a pornocratic, parricidal culture? (p. 70)

Young elaborates further on the philosphical differences between Solovyev and Fedorov and their implications:

Our technological progress has made Fedorov’s thought more plausible.  On the other hand, with Solovyev, the lack of spiritual advancement over the last century may be one reason for the renewed interest in his thought that we find in today’s Russia.  Solovyev offers practical steps for precisely the kind of spiritual development that has been missing in the cage of Soviet Marxist thought. (p. 69)

It is interesting to note that, of all the early Slavophile philosophers, Putin chose the one who was the least strident and most open to the synthesis of differing values and viewpoints.

Moreover, Solovyev is generally considered by both Russians and western academics as one of Russia’s greatest philosophers ever, despite the fallacious denigration heaped upon him by the likes of David Brooks, Mark Galeotti and Maria Snegovaya after learning of the Russian philosophers that Putin had assigned the regional governors to read.  The articles by these writers reveal them to be either tendentious or lacking any substantive understanding of the philosophers they are criticizing.

As Paul Grenier writes in his insightful article, “Distorting Putin’s Favorite Philosophers”:

Up until these articles in March-April of 2014, I do not recall reading a single negative assessment of either of these Russian thinkers [Solovyev or Nicolai Berdyaev], at least not among Western specialists, nor a single one accusing them of being hostile to the West, nor a single one suggesting that they are friendly to Russian chauvinism or nationalism.

Grenier goes on to describe Solovyev’s ideas and how they contradict the characterization presented by Brooks, et al.:

How can Solovyev be described as a “nationalist” when his magnum opus, The Justification of the Good (the book which Putin is said to have urged his governors to read), states precisely the opposite?  It is hard to imagine a more absolute condemnation of national exceptionalism than that contained in Solovyev’s definitive work of ethics:

“It must be one of the other.  Either we must renounce Christianity and monotheism in general, according to which ‘there is none good but one, that is, God,’ and recognize our nation as such to be the highest good that is, put it in the place of God – or we must admit that a people becomes good not in virtue of the simple fact of its particular nationality, but only in so far as it conforms to and participates in the absolute good.”

This same anti-nationalist theme runs through Solovyev’s entire corpus.  He argued bitterly against the Slavophile nationalists of his day.

The spiritual aspects of pre-Soviet Russian Slavophile philosophers and the revival of the Orthodox Church may appeal to a general human spiritual need, particularly in the aftermath of the chaos, trauma and social dislocation of the 1990’s, as well as the need for social cohesion.

Putin appears to grasp this on some level as is evidenced by his Address to the Federal Assembly in 2012 in which he lamented a shortage of empathy and solidarity in Russian society:

Colleagues, today, in our cities and villages, we are seeing the results of what has been happening in our nation, in society, in schools, in the media, and in our heads for the past fifteen to twenty years. And this is understandable. That was the time when we discarded all ideological slogans of the previous era. But unfortunately, many moral guides have been lost too. We ended up throwing out the baby with the bath water. Today, this is often manifested in people’s indifference to public affairs, willingness to tolerate corruption, brazen greed, manifestations of extremism and offensive behaviour. And all of this occasionally takes an ugly, aggressive, provocative form; I’ll go even further and say that it creates long-term threats to the society, security and even integrity of Russia.

It is painful for me to say this, but I must say it. Today, Russian society suffers from apparent deficit of spiritual values such as charity, empathy, compassion, support and mutual assistance. A deficit of things that have always, throughout our entire history, made us stronger and more powerful; these are the things we have always been proud of.

Putin appears to be in touch with the average Russian view of this as recent surveys of Russian opinion indicate that Russians believe in separation of church and state but believe that the church should have influence over social and cultural life.   Also, revealed is that most Russians identify as Orthodox Christian, but do not necessarily attend services, reflecting a desire for a spiritual and cultural anchor but not necessarily a shrill or fundamentalist form of religiosity.

Part II will cover the part of the book pertaining to Nicolai Berdyaev. 

 

 

(Vladimir Putin – Caricature
(image by DonkeyHotey)   License   DMCA)

Pursuant to figures from the Committee to Protect Journalists, murders of journalists in Russia have actually decreased under Putin’s era of governance compared to Yeltsin’s era of governance in the 1990’s.

According to the research of Anatoly Karlin over at Unz Review*:

Moreover, according to figures from the Committee to Protect Journalists – hardly a bastion of Putin apologists – journalist murders have plummeted in Russia under the reign of the Dark Lord of the Kremlin relative to the “free” and “democratic” 1990s when the US was best buddies with Russia, or at least the oligarchs pillaging it, and for that matter whacking any journalists who dared report on their activities.

Literally MORE Russian journalists were murdered for their reporting under 8 years of Yeltsin than 15 years under Putin. (emphasis in original)

During the Yeltsin era, American mainstream media outlets didn’t seem particularly concerned about the plight of Russian journalists, even though it was worse.  They were too busy singing Yeltsin’s praises and characterizing him as a democrat, despite the fact that he had the Parliament building bombed and ordered Russian troops to fire on protesters during a constitutional crisis in 1993, resulting in around 1500 casualties.

Putin, whatever his faults, has never done anything remotely like this.

I will leave it to the reader to ponder the implications of this paradox.

(*Note:  I don’t necessarily agree with everything Karlin says in his article and I certainly don’t endorse Trump; however, Karlin succinctly stated the problem about the hypocrisy inherent in the way that the American corporate media characterizes Putin vs. Yeltsin on this issue, and he provided links to primary sources)

A study from Russia’s largest bank, along with government statistics, indicates that, while still slow,  both consumer confidence and year-on-year figures on industrial output, are trending in a positive direction.

As reported by Business New Europe’s Intellinews, Sberbank’s regular survey of consumer attitudes showed an uptick in consumer optimism in all the 6 areas that are surveyed on:

The sixteenth installment of the survey, compiled by Russia’s biggest bank, has for the first time shown an increase in each of its six indices, with confidence in prospects of personal wealth, country wealth, and the ability to make big ticket purchases all improving in the second quarter of 2016 compared with the first quarter.

….Rising wages and lower unemployment were the driving forces behind the mood improvement in Russia, with Sberbank noting that 25% of respondents got a pay rise in 2016, while unemployment fell from 12.1% last quarter to 11.3% in the latest round of polling. Job security has also improved, with the 39% of Ivanovs who are afraid of being fired down from 44% last quarter.

While conditions for the average Russian family have eased in the last three months, the index suggests that few Russians believe that the economy is completely out of the woods, with the “big purchase conditions” index still deep in negative territory, at -26%.

Intellinews also notes that the lowering of inflation played a significant role in fueling consumer optimism.  Another report over at Russia Direct goes into more detail about how the inflation rate soared in 2014-2015, particularly with respect to food prices, and how it has been steadily decreasing since the end of 2015.  Credit is given to the policies of Elvira Nebuillina, head of the Russian Central Bank.  (Note:  This analysis leans toward a neoliberal slant – NB)

The Central Bank pursues a consistent policy of inflation targeting, trying to use monetary methods to control price dynamics – and in particular, adjusting the prime rate, which during the crisis, the Central Bank has changed 10 times, and which now stands at 10.5 percent. To a large extent, it was the policy of the Central Bank that has contributed to the sharp slowdown in the country’s inflation rate.

The Central Bank of Russia considers this slowing down in the growth of prices as a long-term trend. In any case, given the current positive price dynamics, it has lowered its forecast for the inflation rate at the end of 2016 to 5-6 percent.

The Ministry of Finance agrees with this forecast, predicting by the end of 2016, the lowest inflation rate in Russia’s recent history – 6 percent.

….Last year, the main drivers of inflation were growing food prices – something painfully felt by the population. Now the situation has changed. In its reports, the Central Bank has noted that food prices grew moderately in May, on an annual basis, in comparison with the prices being charged for industrial goods and services. This was made possible by the “high level of supply of agricultural products, and the successful active implementation of the import substitution program in the food industry.”

Another Intellinews report discusses the most recent year-on-year industrial output numbers, which showed better than expected growth.

Russia’s industrial output put in  unexpected ahead of consensus growth in June,  increasing by 1.7% y/y and 0.3% m/m in seasonal and calendar adjusted terms, according to a Rosstat report published on July 14.

….The growth beat the Reuters consensus expectation of 0.6% y/y growth in June and the Ministry of Economic Development’s forecast of 0.3% y/y growth.

….Most notably, manufacturing output growth continued to strengthen in June, posting 1.6% y/y growth versus 0.3% y/y seen in May and making the fastest monthly y/y rate in two years.

….Sberbank sees import substitution and a moderate recovery in investment demand as the main growth drivers in the manufacturing sector, with the food industry being the main benefactor from ruble depreciation in terms of output. But textiles, clothing, footwear, and production of pulp and wood also gained.

….”We would also like to point out the growth in the output of tractors (15.6% y-o-y in 1H16) and trucks (4.4%), which may point to an improvement in investment,” Sberbank CIB notes, reiterating its generally positive views that the Russian economy will see a moderate upturn in the second half of the year.

….The usually more conservative Alfa Bank also welcomed the “strong improvement” of the industrial output in June, beating the bank’s 0.5% y/y growth expectations.

The “gray” economy – or the number of people earning a living off the record by being paid under the table –  is a major issue in Russia.   It adversely affects the government’s budget via lower tax revenue.  By some estimates, the gray economy comprises as much as 46% of GDP.  As Bloomberg reports, the Putin government is looking into way to address the issue.

Legalizing the shadow workforce alone would boost GDP by one percentage point, according to Boris Titov, the Kremlin’s business ombudsman. No longer limited to retail trade, Titov says it’s becoming a hive of small-scale manufacturing, developing into an “economy of simple things.” Businesses can be tempted into the open if the government can ensure fewer regulatory checks and a patent system catering to the self-employed, Titov said.

The hurdles are many. While Russia has surged by 61 spots in the World Bank’s Ease of Doing Business Index since 2013 to 51st this year, dealing with construction permits still takes almost nine months Its property rights, judicial independence and the burden of government regulation were all rated below the 100th spot among 140 nations in the World Economic Forum’s 2015-2016 Global Competitiveness Report.

The government plans to adopt a law this fall freeing several categories of self-employment from taxes and easing their way to registration, leaving them to pay social levies only, First Deputy Prime Minister Igor Shuvalov said in an interview.

“We understand that only the Tax Service will lead them out of the shadows,” he said. “Now everything is being automatized, financial discipline is increasing. I think that in a couple of years, evading taxes will be extremely difficult.”

Among the most far-reaching ideas yet for nudging businesses out of the shadow economy is a proposal by the Finance Ministry to cut the payroll tax that employers pay on salaries, three officials familiar with the discussions said last month. If a lower levy is accompanied by an increase in the value-added tax, the measures could help authorities collect about 30 percent of the amount of salaries companies pay in cash, which the Finance Ministry has estimated is costing the government as much as 2 trillion rubles a year in lost taxes.

The need to shrink the size of the shadow economy was the subject of a meeting held at the Finance Ministry on Tuesday, which discussed fighting under-the-table salaries to increase tax collection.

By creating the conditions that would motivate entrepreneurs to come clean, Russia may pave the way for a revival of small and medium-sized businesses, whom Putin sees as a foundation for the economy. Such companies employ a fifth of the workforce, far short of the government’s goal to raise the level to at least half the total.