By Kevin Gosztola, Substack, 4/22/24

On April 20, Edward Snowden declared, “America lost something important today, and hardly anyone heard. The headlines of state-aligned media screech and crow about the nefarious designs of your fellow citizens and the necessity of foreign wars without end, but find few words for a crime against the Constitution.”

The NSA whistleblower was referring to the United States Senate reauthorizing and expanding surveillance under Section 702 of the Foreign Intelligence Surveillance Act. 

President Joe Biden circulated a memo that cast the Fourth Amendment right to privacy as a “threat to national security.” Biden National Security Advisor Jake Sullivan and Attorney General Merrick Garland called members of Congress to ensure that they voted to give spy agencies renewed power.

Specifically, “Patriot Act 2.0,” as Representative Zoe Lofgren called it, broadened the definition of service providers and exponentially increased the power that the government has to force numerous business and industries to aid warrantless surveillance. 

Senator Ron Wyden strongly opposed the legislation and even introduced an amendment that would have prevented this assault on civil liberties. But the Senate rejected his effort to protect privacy. 

“The Senate waited until the 11th hour to ram through renewal of warrantless surveillance in the dead of night,” Wyden stated. He also added, “It is clear from the votes on very popular amendments that senators were unwilling to send this bill back to the House, no matter how common-sense the amendment before them.”

Although the Foreign Intelligence Surveillance Court (FISC) renewed Section 702 until April 2025, allowing lawmakers plenty of time to appropriately draft and amend legislation, panic was stirred by Biden and the national security state.

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Wyden, who has a track record of challenging surveillance, did not mince words. He described the provision that he fought, which was dubbed the “Make Everyone A Spy” provision, as “one of the most dramatic and terrifying expansions of government surveillance authority in history.”

“It allows the government to force any American who installs, maintains, or repairs anything that transmits or stores communications to spy on the government’s behalf. That means anyone with access to a server, a wire, a cable box, a wifi router, or a phone. It would be secret: the Americans receiving the government directives would be bound to silence, and there would be no court oversight.”

Forcing More Service Providers To Spy On Customers

The Biden administration applauded the passage of legislation that expanded warrantless surveillance. “The President will swiftly sign the bill into law, ensuring that our security professionals can continue to rely on Section 702 to detect grave national security threats and use that understanding to protect the United States,” Sullivan stated. 

Section 702 used to primarily apply to telecommunications or technology companies. Now, as detailed by Demand Progress, Section 702 may be used to force business landlords, cleaning contractors, delivery personnel, utility providers, etc, to help U.S. security agencies spy without probable cause.

Entities and individuals required to help with surveillance cannot speak about it. Their First Amendment speech rights are curtailed as they violate their customers’ Fourth Amendment privacy rights.

Also, according to Demand Progress, House Intelligence Committee Chair Mike Turner and House Intelligence Committee Ranking Member Jim Himes drafted the expanded surveillance reauthorization without defining terms like “any other service provider,” “access to equipment,” or “custodian.”

Only as a result of opposition did security hawks insert an exemption for coffee shops, hotels, and libraries.

Writing about the impact on journalism for The Nation, longtime national security journalist James Bamford wrote, “A requirement could easily be added to Section 702 that compels the need for a warrant as soon as an NSA employee or FBI agent recognizes that the communication involves a journalist conducting an interview, or an attorney engaged in a conversation with a client or source.”

“In the end,” Bamford argued, “insight gained from the American journalist’s interaction with a foreign source may be far more valuable and provide considerably more insight than inhibiting sources to interact with journalists.” 

The FBI consistently abused the surveillance power it was granted under Section 702 before the authority was reauthorized. It is a certainty that the FBI will abuse this ill-defined authority handed to them by Biden and Congress. 

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No Justification For Opposing A Warrant

House Speaker Mike Johnson was at one point an opponent of warrantless surveillance under FISA. He claimed that he shifted his position because as Speaker he is privy to “confidential briefings” that have showed him how critical Section 702 is to “national security.”

“I personally used 702 authorities at NSA,” Snowden responded. “There is absolutely nothing in any briefing of any level, then or now, that would justify opposition to recognizing the government’s obligation to seek a warrant for searches of Americans’ communications, which are constitutionally-protected.”

“And frankly, let’s be serious: the NSA and FBI have plainly demonstrated that they’re more than comfortable violating the law when they feel it binds too tightly. 278,000 times just for one auth: 702. Millions and millions of times under others for [President Barack] Obama. And on a literally innumerable scale under [President George W.] Bush—we couldn’t even count it.”

“So let’s not pretend that, in the apocryphal ‘ticking time-bomb’ scenario of the Hollywood imagination, that a series of agencies which have since their inception been characterized by a criminally casual respect for the Constitution would feel in the slightest way encumbered by something as parochial as the law,” Snowden added. “After all, the legislation rarely ascribes penalties for federal infractions.”

The House Judiciary Committee passed legislation—the Protect Liberty and End Warrantless Surveillance Act—at the end of 2023 that would have required a warrant for any U.S. person search. However, through the House Intelligence Committee, U.S. officials thwarted attempts to constrain the national security state.

During a private meeting on reauthorization, WIRED reported that Turner “presented an image of Americans protesting the war in Gaza while implying possible ties between the protesters and Hamas, an allegation that was used to illustrate why surveillance reforms [would be] detrimental to national security.” 

It is highly likely that antiwar or pro-Palestinian protests, particularly on college or university campuses, will be targeted. Biden will probably have no problem with using this expanded spying power against students. 

A day after Biden signed the reauthorization bill, White House Deputy Press Secretary Andrew Bates accused student demonstrators opposed to Israel’s assault on Gaza of “echoing the rhetoric of terrorist organizations.”

Hawkishly Backing The National Security State

Back in 2008, Democratic presidential candidate Barack Obama campaigned against retroactive immunity for telecommunications companies that helped Bush engage in warrantless wiretapping. He even promised to filibuster the FISA Amendments Act. But Obama voted for the bill when there were 46 different lawsuits pending against the companies and angered many progressives and civil liberties advocates. 

Biden, who was Obama’s vice president, did not even pretend to support reform, greater accountability, or limits to government surveillance. Fifteen years after Obama flip-flopped, Sullivan, his national security advisor, made it clear that the administration believed that “failure to reauthorize Section 702” would be “one of the worst intelligence failures of our time.”

He additionally urged Congress to reauthorize Section 702 “without new and operationally damaging restrictions on reviewing intelligence” and “with measures that build on proven reforms.” That was subtle language, which sent a message to representatives and senators that Biden opposed adding a warrant requirement to protect Americans’ privacy rights.

Hawkish lawmakers, intelligence officials, and the Biden White House conspired to pass an updated surveillance law that not only avoided meaningful reforms but also expanded the law in a way that U.S. intelligence agencies could only dream about a year or two ago.

For many months, news reports detailed stories of spying abuses and enraged lawmakers. That gave some hope to those in favor of privacy that Congress might rein in government surveillance. Yet the national security state stayed the course. They once again hid the truth from elected officials, accelerated the process, and fear-mongered and spread propaganda to escape accountability. 

By Gordon Hahn, Landmarks Magazine (Substack), 4/1/24

The Simone Weil Center’s Symposium on ‘Containment 2.0’

On March 6, 2024, there appeared in Foreign Affairs a noteworthy article. Penned by four authors (Max Bergmann, Michael Kimmage, Jeffrey Mankoff, and Maria Snegovaya), the article is titled “America’s New Twilight Struggle with Russia: To Prevail, Washington Must Revive Containment.” 

As the article’s title makes clear, the authors are calling on the U.S. to return, in its relations with today’s Russian Federation, to essentially the same multi-faceted (and costly) global strategy of resistance to the USSR that was recommended, back in 1947, by George Kennan.

Whatever its possible weaknesses, such a policy has at least the clear benefit of not requiring fundamental changes in how anyone thinks about international politics — one is almost tempted to say that the proposal doesn’t require thought tout court. Western military alliances, Western think tanks, Western politicians, can simply let inertia continue to carry them forward, and as they do so, carry along with them the rest of the world. 

Will that be a good thing, however — for us, for the world at large? In an effort to mount a serious response to this enormously consequential question, we put out an appeal to our associated scholars and friends of the Simone Weil Center. Over the coming weeks, we will be publishing their responses in Landmarks.  

–  Paul Grenier 

The proposal for a “new American twilight struggle with Russia” and a “new containment” policy which recently appeared in Foreign Affairs offers us nothing more than a continuation of the policy that has already led to the NATO-Russia Ukrainian War – NATO expansion. The co-authors are in effect calling on the West to double, triple, and quadruple down on stupid on an even grander scale. 

After all, what, in effect if not intent, has been the policy of NATO expansion right up to Russia’s borders? Answer: a de facto ‘New Containment.’ The ‘post-Cold War’ New Containment based on NATO expansion and the attendant policies employed in order to achieve it – democracy-promotion, colour revolutions, economic sanctions,  the arming and equipping of Islamist and nationalist extremists in ‘target countries’ – led directly to the ‘New Cold War,’ as well as to the ongoing NATO-Russia Ukrainian War, and a series of preceding wars in Iraq, Afghanistan, Yugoslavia, Georgia, Libya, and Syria. Now four Foreign Affairs authors are proposing an extension and expansion of post-Cold War New Containment in what will be the creation of global Containment 2.0 motivated once again by the pursuit of a now elusive American hegemony and the quest for total security by way of NATO expansion (or ‘integration into Western institutions’) and another escalation of the New Cold War. 

Containment 2.0’s geography, according to the authors’ concept, marks “the most important difference” from Containment 1.0, under which NATO was the lead mechanism. New containment’s geography should not encompass Europe “primarily,” as the old containment did. Instead, “post-Soviet Eurasia and the rest of the world will be more central.” In other words, as its focus, the West’s Containment 2.0 should substitute Europe with all of Eurasia, in reality Great Eurasia — MacKinder’s “World Island” — stretching east-west from China to the English Channel, and north-southfrom the Indian Ocean to the Arctic. The entire globe becomes the outer concentric circle of the core area of interest and a secondary area of economic, political, developmental (colour revolution/democracy-promotion), intelligence, and military operations. The key “flash points” are located along “Russia’s western periphery” as they have been ever since NATO began to expand after the Cold War. The West should work on integrating “Armenia, Azerbaijan, Georgia, Moldova, and Ukraine” (GUAM becomes GUAAM) into “Western institutions” – i.e. NATO (and the EU) – while “checking Russian influence in Central Asia” (and Africa).  

Outside Eurasia, the authors recommend military action to “contest Russian influence outside Europe” as a secondary strategy. There, Containment 2.0 should “primarily” deploy “development assistance, trade, and investment.” Thus, a West that is less robust and dominant economically than when it inaugurated Kennan’s Containment 1.0 in the post-World War II years will be expanding its sphere of ‘vital’ interests or domination to the entire globe, thereby expending even greater financial and military resources. This is being recommended in the aftermath of what is emerging as a failed effort to expand its domination to Iraq, Afghanistan, Egypt, Libya, Syria, Georgia, and Ukraine, sparking wars and chaos in the bargain. Although this expansion and overextension would be merely making explicit and declared what has already been the implicit and undeclared policy in Washington, London, and Brussels since the Cold War’s end, it suggests a more intensive effort in its geographical, operational, financial, and budgetary dimensions. 

The authors are aware that the international context of the New and Old Containments differ, but they are not aware enough. They note that just as during the First Cold War, the West will face off in the Second Cold War against not just Russia but also China as well. But they pass over the facts that China is far more powerful economically than the USSR was, that there is no Sino-Soviet rift offering opportunities for peeling one of them off from their tight  geopolitical near-alliance, and that China and Russia are proving far more adept than were Russian and Chinese communists at rallying powerful states in vitally important regions such as the Middle East and the Arab and Muslim worlds and indeed elsewhere across the world’s continents.  BRICS+ is never mentioned, nor is the Shanghai Cooperation Organization. Yet the former has attracted three Middle Eastern states that the authors hope to rely on in the region. Most disturbingly, the authors also fail to note or consider important that a fundamental “novelty of the present moment” compared with the onset of the First Cold War and Containment 1.0 is that today NATO is already deeply involved in – is effectively a combatant-party – in a European war against Containment’s target.

What will be the mechanisms to implement Containment 2.0? One can be sure that one, if not the leading one will be that very same NATO at war with Russia in Ukraine. A return to and expansion of ‘out-of-area operations’ will be ensured, and the transformation of NATO into a global rather than a European military alliance is all but certain. The opening of a North Atlantic Treaty Organization office in Japan was the first toll of that bell. Cooperation between NATO, AUKUS and QUAD will grow and be subject to being parlayed into the formation of a global NATO by some other name. NATO expansion’s internal logic of eternal expansion – the need to secure new, newer, and newest ‘flanks’ – will be locked in as a result of the proposed Containment 2.0.

The authors’ policy would mean the West would eschew seeking a modus vivendi, a mutually acceptable security architecture with Russia or any agreement regarding Ukraine. This proposal demonstrates that many in Washington intend to persist in expanding NATO “irrespective of how the war in Ukraine ends.” Indeed, the authors think that “even if Ukraine does not achieve total victory on the battlefield, it could nevertheless be integrated militarily and politically with the West”! Pursuit of a Containment 2.0 will lock in confrontation and likely also further military conflict with Russia, whether through proxies or otherwise, and so perhaps with China as well.  Of particular importance is another result that follows from the authors’ typical, for Washington, lack of self-awareness. They ignore that the project of insisting on NATO expansion to Russia’s borders, a project which was pursued for over a quarter of a century, revived what is typically called ‘Russian paranoia,’ but what is in reality a quite rational security vigilance strain in Russia’s strategic and political culture in respect to the West.

Historically, divisive cultural and political influences, interference in Russia’s domestic affairs, interventions of various sorts, and numerous military invasions from the West have taught Russians to distrust the very West they have often sought to emulate. The post-Cold War era has seen this pattern repeat, with the revival and renewed dominance of Russia’s traditional security vigilance culture vis-a-vis the West after having gone through a period, during perestroika and the post-perestroika 1990s, when Russia’s traditional security culture had receded into the background.  This is the result of the West having rejected the path of a strong, not open-ended but sufficient, American and Western security order enveloped in a balanced global security architecture. 

The West’s relentless post-Cold war pursuit of a ‘new world order’ of maximal American power, dominance, and hegemony across the globe has its very own emblem: it is the emblem of NATO. Intensifying NATO expansion in the form of Containment 2.0 will exacerbate these trends, entailing still more escalation in the relationship as Russians become even more convinced that the rationale of their security vigilance norm vis-à-vis the West is the correct path, even a special Russian calling. This will inspire a new, even an official state ideology in Russia and perhaps elsewhere that will be anchored in animosity toward the West. In the West itself, the escalating, already partly hot New Cold War will lead to further enlargement and authoritarianization under the national security state. 

The Containment 2.0 proposal further confirms my own suspicions that the slogan ‘long war’ in relation to the NATO-Russia Ukrainian War is the product of the aspirations among certain elements in Washington that the Ukrainian war be dragged out, because this is to the West’s advantage. Regardless of the risks of escalation, they believe the West must prolong some form of armed resistance to Russia in Ukraine. Indeed, as the authors put it, “Containment should be implemented “for as long as necessary,”[emphasis mine – GH] and “Ukrainian victory” is “a long-term goal.”  They appear to define ‘victory’ as “(f)orcing Russia to abandon all or most of the territory it has occupied.” But the authors propose no new specific strategies or tactics for how to defeat Russia in Ukraine or how to “push the Russian threat farther from Europe’s borders” – other, that is, than by sending insufficient military aid packets from Europe of $50 billion and the still-unapproved American packet of $60 billion. This means continuing the war ‘to the last Ukrainian’ for as long as it takes for Russian forces to reach the Polish border. After Kiev’s defeat in conventional war, it will require proceeding to build and sustain a partisan insurgency movement in any post-war pro-Russian or occupied Ukraine or rump neutral Ukraine. 

The long war is designed not only for the domestic political purpose of holding off a full collapse of the Ukrainian front until America’s November election. No, this next ‘twilight struggle’ must last as long as it takes to achieve ‘regime change’ in ‘Putin’s Russia,’ or, failing that, the West’s hoped for succession crisis in Russia could provide another opening for making good on the West’s ‘right’ to expand NATO to Ukraine and beyond.

By Dmitry Trenin, RT, 4/2/24

When President Vladimir Putin, back in February 2022, launched Russia’s military operation in Ukraine, he had specific, but limited objectives in mind. It was essentially about assuring Russia’s security vis-à-vis NATO.

However, the drastic, expansive and well-coordinated Western reaction to Moscow’s moves – the torpedoing of the Russo-Ukrainian peace deal and the mounting escalation of the US-led bloc’s involvement in the conflict, including its role in deadly attacks inside Russia – have fundamentally changed our country’s attitude towards our former partners.

We no longer hear talk about “grievances” and complaints about “failures in understanding.” The last two years have produced nothing less than a revolution in Moscow’s foreign policy, more radical and far-reaching than anything anticipated on the eve of the Ukraine intervention. Over the past 25 months, it has been quickly gaining in strength and profundity. Russia’s international role, its position in the world, its goals and methods of reaching them, its basic worldview – all are changing. 

The national foreign policy concept, signed by Putin just a year ago, represents a major departure from its predecessors. It establishes the country’s identity in terms of it being a distinct civilization. In fact, it is the first official Russian document to do so. It also radically transforms the priorities of Moscow’s diplomacy, with the countries of the post-Soviet ‘near abroad’ on top, followed by China and India, Asia and the Middle East, and Africa and Latin America.

Western Europe and the United States rank next to last, just above the Antarctic.

Unlike in the previous decade, when Russia’s “turn to the east” was first announced, these are not just words. Our trade partners, not just political interlocutors, have also switched places. In just two years, the European Union, which only recently accounted for 48% of foreign trade, is down to 20%, whereas Asia’s share has soared from 26% to 71%. Russia’s use of the US dollar has also plummeted, with increasingly more transactions being conducted in Chinese yuan and other non-Western currencies such as the Indian rupee, the UAE dirham, as well as the instruments of our partners in the Eurasian Economic Union, and the ruble itself.

Russia has also ended its long and tiresome efforts to adapt to the US-led world order – something which it enthusiastically embraced in the early 1990s, grew disillusioned about in the following decade, and unsuccessfully tried to establish a modus vivendi with in the 2010s. Instead of surrendering to a post-Cold War set-up, in which it was left with no say, Russia has begun pushing back more and more against the hegemonic US-centered system. For the first time since the Bolshevik Revolution, albeit in a very different way from then, the country has de facto become a revolutionary power. While China still seeks to improve its position in the existing world order, Russia sees that state-of-affairs as being beyond repair, and is instead seeking to prepare for a new alternative arrangement.

For the time being, instead of the “one world” concept, which the Soviet Union even accepted in 1986, under Gorbachev, Moscow’s contemporary foreign policy has now split into two. For Russian policymakers, the post-2022 West has turned into a “house of adversaries,” while partners for Russia can only be found in the countries of the non-West, for whom we have coined a new description, “the World Majority.” The criterion for being included the group is simple: non-participation in the anti-Russia sanctions regime imposed by Washington and Brussels. This majority of over 100 nations is not considered a pool of allies: the depth and warmth of their relations with the Russia vary greatly, but these are the countries that Moscow can do business with.

For many decades, our country has been exceedingly supportive of various international organizations; it sought to join as many clubs as possible. Now Moscow has to admit that even the United Nations, including its Security Council (which Russia, a veto-wielding permanent member, has traditionally hailed as the centerpiece of the world system), has turned into a dysfunctional theater of polemics. The Organization for Security and Cooperation in Europe (OSCE), which Moscow long wanted to see as the premier security instrument in Europe, is now nearly totally dismissed due to the anti-Russian stance of its NATO/EU majority membership. Moscow has quit the Council of Europe, and its participation in a number of regional groupings for the Arctic, the Baltic, the Barents and the Black Seas has been put on hold.

True, much of this has been the result of the West’s policy of trying to isolate our country, but rather than feeling deprived of something valuable, Russians have few regrets over having had to leave or to suspend membership. Very tellingly, having re-established the supremacy of national legislation over international treaties, Moscow now cares little about what its adversaries can say or do about its policies or actions. From Russia’s standpoint, not only can’t the West be trusted any longer; the international bodies that it controls have lost all legitimacy.  

This attitude toward Western-dominated international institutions contrasts with the view of non-Western ones. This year, Russia’s presidency of the recently enlarged BRICS group is being marked by hyperactivity in preparations for hosting. Russia is also most supportive of the Shanghai Cooperation Organization, which its close ally Belarus is about to join. Together with countries in Asia, the Middle East, Africa and Latin America, it’s working closely to build new international regimes in a number of areas: finance and trade, standards and technology, information and health care. These are expressly being designed to be free from Western domination and interference. If successful, they can serve as elements of the future inclusive world order which Moscow promotes.

So, the changes in Russia’s foreign policy run very deep indeed. There is a question, however: how sustainable are they?

Above all, it should be noted that changes in foreign policy are an important, but also a relatively minor element of the wider transformation which is going on in Russia’s economy, polity, society, culture, values, and spiritual and intellectual life. The general direction and importance of those changes is clear. They are transforming the country from being a distant outlier on the fringes of the Western world into something which is self-sufficient and pioneering. These tectonic shifts would not have been possible without the Ukraine crisis. Having been given a powerful and painful push, now they have acquired a dynamic of their own.

It’s true that February 2022 itself was the end result of several trends that had been gathering momentum for about a decade. Feelings that fuller sovereignty was desired finally became dominant after Putin’s return to the Kremlin in 2012 and the re-unification with Crimea in 2014. Some truly fundamental changes with regard to national values and ideology were made in the form of amendments to the Russian Constitution, approved in 2020.

In March 2024 Putin won a resounding victory in the presidential elections and secured a fresh six-year mandate. This should be seen as a vote of confidence in him as the supreme commander-in-chief in the existential struggle (as Putin himself describes it) against the West. With that backing, the president can proceed with even deeper changes – and must make sure that those he has already wrought are preserved and built upon by those who succeed him in the Kremlin.

It is important to note that the Russian elites, which since the 1990s have been closely tied to the West, have had to make a hard choice recently between their country and their assets. Those who decided to stay have had to become more “national” in their outlook and action. Meanwhile, Putin has launched a campaign to form a new elite around the Ukraine war veterans. The expected turnover of Russian elites, and the transformation from a cosmopolitan group of self-serving individuals into a more traditional coterie of privileged servants of the state and its leader would make sure that the foreign policy revolution is complete.

Finally, Russia may not have been able to start moving so quickly in the direction of sovereignty had it not been for the Western policies of the past two decades: the increasing demonization of the country and its leadership. These choices have succeeded in making perhaps the initially most Westernizing, pro-European leadership that modern Russia has seen – including notably Putin himself and Dmitry Medvedev – into self-avowed anti-Westerners and determined opponents of US/EU policies.

Thus, rather than forcing Russia change to fit a Western pattern, all that pressure has instead helped the country find itself again.

By John Varoli, Substack, 4/3/24

Western perceptions of Russia are based on propaganda wrapped in lies, inside mounds of disinformation. So, what’s the real Russia like? I went there to find out. The results were shocking.

My lead above is obviously a play on Winston Churchill’s famous quip in 1939 about Russia being “a riddle, wrapped in a mystery, inside an enigma.”

In their effort to support the liberal globalist war machine, major western media unabashedly fabricate their coverage of Russia, a country that they hate because of its defense of national sovereignty and traditional values.

In the realm of western media lies, life in Russia is akin to North Korea — poverty is rampant and economic collapse imminent under the pressure of sanctions; secret police scour dark empty streets for hapless victims to drag off to slave labor camps; the Kremlin arbitrarily invades neighboring nations “to rebuild the Soviet empire”; and every Russian wants to escape and flee to the West.

This disinformation is so total and omnipresent that even the most educated and astute minds in the West can fall under its influence. The U.S. has few credible independent media and expert sources, and most Americans don’t have the time and skills to do their own research.

Even I had my doubts — just before departing New York last month, I almost cancelled my trip because I was bombarded with messages from people who tried to convince me that “Putin will abduct” me and use me as “a pawn to exchange” for Russians held in U.S. prisons. I began to wonder — “Maybe they’re right.”

With some apprehension, I boarded the plane and within a day I found myself on the Russian border. This was my first visit in five years. Instead of the lies and disinformation mentioned above, my trip revealed a country with a vibrant civil society where people enjoy far more freedom, economic opportunity and social protections than we do in the West.

Developing in the right direction

I spent two weeks traveling to five regions — the Leningrad Region, Saint Petersburg, the Novgorod Region, the Moscow Region, and Moscow. I saw life in both provincial towns and big cities, and talked freely to a wide range of people. I traveled on my own schedule, living in local neighborhoods not in hotels.

Except for extra questioning at the Russian border due to my U.S. passport, never once was I approached, detained, followed, or harassed by police. Russian cities have a distinct vibe of freedom and safety; something you’d never say about U.S. cities.

Even though I visited in March, when the weather is gray and Russians still struggle with winter doldrums, I found the people to be of tremendous heart, goodwill, respect and kindness. I almost felt like I was back in the USA that we had 30 years ago.

The violence, arrogance, rapacity and anger that marked life in Russia when I lived there in 1992 to 2012 seemed to have dissipated significantly. What had happened in the past 12 years to make such a difference? ….especially when in this same period the U.S. has been on a downward spiral of violence, strife, hatred and collective insanity.

Russia is not perfect; it has a fair share of problems like any country. Provincial towns still have a standard of living that lags behind similar settlements in Europe and the U.S. But overall, Russia is developing in the right direction, which can’t be said for the West that’s plagued by increasing civil strife and approaching financial calamity.

Packed houses of worship

Orthodox churches are packed. Unlike the U.S. and Europe that are building ‘progressive’ societies based on secular totalitarian ideology, I saw Russians exhibit sincere devout religious sentiment, visiting houses of worship even during weekdays, and, in general, adhering to a moral code as they went about their daily lives.

Even in Moscow and St. Petersburg the churches were packed, which was very unexpected. Urban dwellers across the globe often have little room for religious faith in their lives. But that’s not the case in Russia. Moscow lives up to its moniker as the “Third Rome”, Christianity’s central city.

With some friends, I visited the tomb of St Sergius at the Holy Trinity Lavra in the Moscow Region. The line of the faithful stretched long to approach the saint’s tomb and leave a prayer request. In the fight with the West, Russia’s monasteries are the country’s ‘secret weapons’. No contraption designed by NATO’s military industries can overcome the spiritual power of Russia’s monasteries and its faithful.

Unlike Zelensky’s Ukraine where the native Orthodox Church has been banned, priests jailed, and churches and monasteries bombed, freedom of religion flourishes in Russia. Traditional faiths are protected from the scorn, derision and persecution that they often face in the West.

No anti-American feeling

While there (rightfully) was much criticism of the White House’s violent and lawless foreign policy, I encountered no hostile sentiment toward the American people; not the slightest incident. In fact, many Russians continue to learn English, watch American entertainment and listen to our music. Compare that to how we have cancelled everything to do with Russia and their culture.

Even though I’m a citizen of a country that now sponsors terrorism and fuels a brutal war against Donbass and Crimea, Russians didn’t harbor ill feelings towards me. I had encountered far more anti-American sentiment while living in Russia in the 1990s, a time when relations were rather friendly.

On this trip, Russians went out of their way to help me in every way possible; to be hospitable, friendly and accommodating. How to account for such humane and enlightened attitudes? Perhaps it’s connected to the piety of the Russian people, with their deep understanding of the power of mercy, charity and forgiveness, and a belief that individuals shouldn’t be held responsible for the sins of their ruling class.

Rising living standards

The Russian economy is booming and people now live far better than before the year 2000 when Vladimir Putin became president. Unemployment hovers just above 2.5%, and inflation is under control. Interest rates, however, are in the range of 17%, which is a drag on further economic growth.

Even if we put aside the technological and industrial advances of the past two decades that have improved life for most people across the globe, there are specific policy decisions by Putin’s government that have improved the quality of life.

These include his vigorous efforts to improve law-enforcement, restore public safety, as well as smash organized crime and the stranglehold that liberal oligarchs once had over Russia’s economy. Throughout the 1990s and into the 2000s, the oligarchs siphoned off hundreds of billions of dollars in national wealth, mostly from the sale of natural resources, and then stashed the cash abroad.

To this day, I can personally name Russian gangsters, fugitives from justice in Moscow, who have found a warm welcome in the U.S. This is why some oligarchs in exile can’t forgive Putin and continue to finance so-called ‘opposition figures’ such as the deceased U.S. asset Alexei Navalny.

By ‘rising living standards’ I don’t merely mean material well-being. There are also non-tangibles to consider, such as living in a country where the government protects and supports national cultures, traditional values and sovereignty. This is certainly a major factor contributing to the optimism that I sensed in the air.

Finally, the food — the food is fantastic. Natural. Delicious. Fresh. I surmise this is the result of strict state regulation over the food supply and the quality of ingredients and means of preparation — Something that’s nearly absent in the U.S.

Vibrant and open discussions

Everyone I spoke to, from the average person in the street to those who I met at events, exhibited an exceptional intellectual curiosity and ability. People were open-minded, eager to discuss and debate. They exhibited a high level of knowledge about their country and the world.

I lectured at the St. Petersburg Technology University, where insightful discussions ensued with students, some of whom disagreed with Russia’s policies. No one was afraid; conversations were lively and uninhibited. There were no ‘thought police’ ready to pounce, as is often the case in American universities.

For the most part, the vast majority of Russians sincerely support President Putin, as recent elections prove. There are two main reasons for his massive popularity — he stopped Russia’s disintegration in the 1990s, and his policies have made the country a much better place to live.

Also, I attended a few talk shows on state-run TV where we discussed geopolitics. I was surprised that the TV host always presented the U.S. version of events, even showing western media coverage so that the audience would clearly understand both sides of the issue, and not just the Russian point of view.

Then several of us would go on to discuss, debate and analyze the issue at hand. Never once did anyone try to prep me, control me, prod me or push me to say certain things. In fact, a few of the talk shows were live on air — which goes to show just how much freedom the Russian media allows.

“Do Not Travel” to Russia?

This could be the finest portrait of Joe Biden (above), capturing the essence of his soul — an evil man who has brought misery and suffering to so many. I suspect that such a portrait is hidden somewhere in a White House attic, something right out of Oscar Wilde’s novel, The Picture of Dorian Gray.

The White House is afraid of Americans traveling to Russia. Why? Because they don’t want us to know the truth about how Putin has succeeded in making Russia stronger and more prosperous, how he protects the national culture and its traditions — All things that most Americans would love to see their own government do.

That’s why the State Department has labeled Russia as “a level 4 risk — DO NOT TRAVEL.” John Kirby, the White House’s national security communications adviser, has said that “If you’re a U.S. citizen, including a dual national, residing in or traveling in Russia, you ought to leave right now. Depart immediately.”

For my part, I can’t wait to return to Russia. And many Americans agree with me. Russia has become a destination for American dissidents and refugees, with a private effort afoot to build two ‘American villages’ outside of Moscow.

Crocus and Russia’s historic mission

My trip to Russia was marred on my last day with news of the heinous terrorist attack in Moscow. Investigators have pretty much proven that Ukraine’s secret services were behind the Crocus City massacre and that the West most likely assisted. Earlier this year, Under Secretary of State Victoria Nuland had threatened Russia with “nasty surprises”, while Chairman of the Joint Chiefs of Staff General Mark Miley threatened “There should be no Russian who goes to sleep without wondering if they’re going to get their throat slit in the middle of the night.”

At the very least, the U.S. and all of NATO bear responsibility for the attacks because over the past two years they’ve incited hatred of Russians through disinformation, as well as by arming the regime in Kiev, and because the CIA actively trains the Ukrainian secret police in committing terrorist attacks and other crimes.

The Crocus City terror attack is a turning point. It’s the nail in the Kiev regime’s coffin, and possibly that of NATO. The attack has only strengthened Russian resolve. Just in the past week, the Russian Air Force has knocked out much of Ukraine’s energy infrastructure, and a hunt is underway for agents of its secret services responsible for a multitude of terrorist attacks.

More than ever, Russians understand very well that they’re fighting for their survival, against a formidable coalition of some 50 hostile nations that’s come to their doorstep to continue where Napoleon and Hitler failed. In many ways, we could even classify the liberal globalist onslaught as the ‘spiritual heir’ to the bloody French Revolution and Nazi death cult.

Recent events show clearly that we’ve left the realm of mere geopolitical rivalry between East and West. This is now another epic war against evil. And the past 210 years show conclusively that Russia always emerges triumphant.

Meduza, 4/15/24

Last week, Russia’s Finance Ministry released its preliminary report on the federal budget indicators for the first quarter of 2024, revealing results that surpassed expectations. Government earnings soaring above last year’s figures, a surprisingly positive outcome partially attributed to high oil prices and increased consumer spending. With more money in its coffers and the war in Ukraine still raging on, the Russian government is only increasing its spending. However, this upward trend raises concerns about continued inflation. Meduza explains what led to this sudden influx of funds and what economists think about the Russian economy’s outlook.

Why are Russia’s oil and gas revenues up?

In the first quarter of 2024, oil and gas earnings surged by nearly 80 percent compared to the same period in 2023, injecting 2.9 trillion rubles ($31 billion) into Russia’s federal budget. There are a number of factors that led to this sizeable increase. Firstly, oil prices are on the rise. At the beginning of the year, a barrel of Brent crude oil was trading at $80; now, it’s going for more than $90. The U.S. has been replenishing its raw material reserves as OPEC countries cut production, leading to a shortage that’s driven up prices. Furthermore, the conflict between Israel and Hamas has threatened shipments through the Red Sea, raising concerns among investors about potential disruptions to the supply chain. Moreover, Iran, one of the world’s major oil suppliers, has now entered the conflict.

Secondly, Russia has revised its method for calculating the mineral extraction tax (MET). In 2023, revenues were collected based on actual prices for Urals oil, the blend used as the price benchmark for Russian oil exports. However, the returns were unpredictable: discounts on raw materials constantly fluctuated in response to sanctions pressures. Starting this year, there’s a new system in place. If the price difference between Urals oil and Brent isn’t too significant, the authorities still use the actual Urals oil price for tax calculations. However, if the gap widens, the Russian Finance Ministry imposes a maximum discount of $20 per barrel in its calculations. This means that if a barrel of Brent is selling at $100 and a barrel of Urals is selling at $50, the ministry disregards the actual price and levies taxes based on a price of $80 per barrel. This maneuver has proven effective: analyst Kirill Rodionov calculated that at the beginning of last year, the average price used for tax calculations was $51 per barrel. Now, with the new calculations, the average is closer to $70.

The Russian government has also seen an increase in revenues from its quarterly profit-based tax (NDM). Unlike MET, which is paid based on the volume of extracted raw materials, NDM is levied on profits from sales. This allows companies to defer their tax burden until after they’ve become profitable, which, in theory, encourages them to invest in developing new reserves. Likewise, when an oil deposit begins to deplete, the tax starts to drop off, incentivizing companies not to abandon the project. The more companies increase their overall production, the more tax revenue the government stands to make once the companies turn a profit.

When a company transitions to paying NDM, it continues to pay MET, albeit at a heavily reduced rate. Nevertheless, due to the advantages of tax deferral, the profit margins for certain companies remain higher under the combined scheme than when paying only MET at the full rate. Russia has been steadily expanding this profit-based tax regime, growing its share of the federal budget’s oil and gas revenue from 9 percent to 52 percent over the last five years. According to Rodionov’s calculations, federal revenue from NDM went from 211 billion rubles ($2.3 billion) in the first quarter of 2023 to 587 billion rubles ($6.3 billion) in the first quarter of 2024.

The Finance Ministry’s report also highlights a one-time revenue boost from a temporary increase in the MET rate mandated in January 2024. In the fall of 2023, the Russian government halved damper payments, a type of subsidy that compensates oil companies for selling fuel on the domestic market. Unsurprisingly, this led to a sharp increase in gas prices in Russia. The government quickly abolished the unsuccessful reform but decided to compensate for the damper payments through a higher MET.

Since Russian tax legislation doesn’t allow for MET to be applied retroactively, a higher MET rate was imposed on companies in January of this year, allowing the Finance Ministry to make up for last fall’s budget losses. Although the report doesn’t disclose the exact amount, Interfax’s sources estimated it at around 190 billion rubles ($2 billion).

The ruble’s depreciation could also have impacted the statistics. At the beginning of 2023, the Russian ruble was stronger, trading at around 70 to the U.S. dollar, meaning fewer rubles for every dollar of oil earnings, notes Evgeny Nadorshin, the lead economist at PF Capital. The ruble weakening to 90 to the dollar automatically led to an increase in budget revenues from oil sold abroad.

Taking all of these factors into account, Russia’s Finance Ministry predicted that oil and gas revenues will continue to exceed the baseline level, saying it observes a “stable positive trend.”

Where else is the money coming from?

While government earnings from oil and gas have certainly gone up, Egor Susin, the managing director at Gazprombank Private Banking, highlights other revenue streams as the primary positive contributors to the budget. Over the course of a year, non-oil and gas revenues have risen by 43 percent, bringing in 5.8 trillion rubles ($62 billion) in the first quarter alone.

The Finance Ministry attributed much of these gains to turnover taxes: taxes levied on the volume of business activity or turnover of goods and services rather than on profits. For instance, value-added tax (VAT), brought in 3.4 trillion rubles ($36.3 billion) in three months. Russia is experiencing a growth in domestic demand, as analysts at Raiffeisen Bank have pointed out, and consumer spending is increasing despite inflation.

As a rule, Russia’s Central Bank sees high demand as a risk for further inflation. For the Finance Ministry, however, the situation is beneficial — at least in the short term. While the government’s budget also suffers due to inflation (e.g. with the cost of infrastructure projects going up), the ministry can acquire funds immediately and then distribute the rise in expenses over time.

The ministry also mentions “planned receipts of one-time non-tax revenues.” Generally speaking, “non-tax revenue” refers to things like fees for the use of state property, customs duties, environmental levies, and so on. It’s possible that in this case, the ministry is referring to the sale of state-owned assets. In 2023, the Russian authorities initially aimed to generate 1.8 billion rubles ($19.2 million) through privatization. However, due to urgent budgetary needs, they ultimately sold off 29 billion rubles ($309.7 million) worth of property. This year, the ministry has set a significantly higher target from the outset: selling 100 billion rubles ($1.07 billion) worth of state-owned assets.

Although the Finance Ministry acknowledged that last year’s low baseline facilitated such noticeable growth, it views the current situation with non-oil and gas revenues as stable and anticipates “continued rapid revenue growth.” Raiffeisen Bank analysts concurred, predicting that consumer activity in Russia will likely remain high “in the coming months.”

Will Russia start spending more?

The Russian government has already ramped up its spending. Compared to the first quarter of 2023, budgetary expenses have increased by 20 percent.

With the onset of the full-scale war in Ukraine, federal budget expenditures acquired a pronounced seasonality, rising sharply at the beginning of the year when the government pays out advances on state contracts. In the first two months of 2024 alone, expenditures amounted to 6.5 trillion rubles ($69.4 billion) while revenues totaled only five trillion ($53.4 billion), resulting in the Finance Ministry nearly exhausting the deficit limit for the entire year. Last year, the same trend raised concerns; in the end, however, the deficit didn’t stray too far from the target.

With current oil prices, Russia’s situation has already begun to improve. While the first quarter saw an overall deficit, March’s budget boasted a surplus of 860 billion ($9.2 billion). Analysts from Raiffeisen Bank say the Russian government’s spending spree at the beginning of the year “shouldn’t be perceived as a risk factor” to the budget. According to their forecasts, the deficit will remain this year, but it will be smaller than in 2023: no more than 2.5 trillion as opposed to last year’s 3.2 trillion ($26.7 billion versus $34.2 billion, respectively). Analyst Semyon Novoprudsky thinks the deficit could be even lower, despite the increase in government spending.

The budget for the current year includes expenditures totaling 36.6 trillion rubles ($390.9 billion). However, this figure was approved before President Vladimir Putin announced five new national projects and numerous other social welfare programs during his annual address to Russia’s Federal Assembly. Economists estimated the cost of their implementation at 1.2 trillion ($12.9 billion) per year. This will be likely offset by tax increases, which, just a month ago, was raising concerns among economists.

Now, analysts from the Telegram channel MMI posit that “with current oil prices, there’s no threat to deficit stability.” Egor Susin from Gazprombank concurs, saying that “the budget appears to be in good shape for the next few months.” Faridaily, run by journalists Farida Rustamova and Maxim Tovkailo, predicts that the Russian government “will be able to finance extravagant military spending, social payments, and infrastructure development without any problems.” Meduza couldn’t find any pessimistic comments from experts.

So, Russia’s economy is just fine?

There are certainly still risks for the Russian economy. In theory, an increase in revenue allows the Finance Ministry to spend more than planned — as it did last year. This injects more money into the economy, further fueling consumer demand in the face of limited supply. Russia’s Central Bank consistently stresses that this has adverse effects on price inflation. And while it aims to keep inflation at 4–4.5 percent in 2024, economists have expressed doubts that this target is feasible.

Elvira Nabiullina, the head of the Central Bank, has noted that maintaining a high key rate helps curb inflation. (Currently, the Central Bank has the key rate set at 16 percent.) With interest rates higher, saving becomes more attractive and credit becomes more expensive, which, in turn, cools demand. In the second half of the year, the Central Bank plans to wait for a slowdown in price growth and then begin to reduce the key rate; however, it might postpone the process. Previously, analysts at the government-owned bank Promsvyazbank expected the key rate to be brought down as early as June; now, they’re predicting a decrease no sooner than August.

Increasing budget expenditures also heighten risks for the national currency exchange rate. The Finance Ministry supports Russian businesses by providing them with funds for production, which often requires imported components and equipment. This means companies have more capital to purchase foreign currency for such transactions. Russia’s Economic Development Ministry officially predicts that the average exchange rate for this year will hover around 90 rubles to the U.S. dollar. However, SberCIB Investment Research predicts the ruble will weaken to 95 against the dollar by the second quarter, while the Moscow-based investment company Tsifra Broker expects the exchange rate to hit 100 rubles to the dollar by the end of April.

Government spending won’t be the only influence on this, of course. The overall state of Russian exports will also impact the ruble: declining overseas shipments of raw materials are reducing foreign currency inflow, creating a deficit. Meanwhile, the population is buying more and more dollars and euros. In February, Russians spent 100 billion rubles (the equivalent of $1 billion) on these currencies; in March, that figure rose to 155 billion ($1.66 billion).

The situation may worsen if sanctions on Russian oil begin to take effect. So far, both lax monitoring and loopholes involving third-party sales have largely enabled Russia to bypass the G7 and E.U.-imposed $60 “price cap” on Russian crude oil. Even so, G7 nations have yet to propose an alternative to the price cap; they’ve only threatened to lower it even further. And while Western governments have imposed sanctions on a few companies for circumventing the ban, such measures are not widespread.