Tuesday, December 31, 2013

Window on Eurasia: From ‘Upper Volta with Missiles’ to ‘Upper Volta with Credits’

Paul Goble

            Staunton, December 31 – Moscow has moved from being an “Upper Volta with missiles,” as German Chancellor Helmut Schmidt once described the Soviet Union, to an “Upper Volta with credits,” a change that may threaten the Russian Federation both abroad and at home, according to Moscow analysts.

            In an essay on the Grani.ru portal yesterday, Vitaly  Portnikov says that when Schmidt made his remark, many Soviet citizens n assumed he was joking because the stores in Ouagadougou had a better selection of goods than those in Moscow and because the source of happiness was fear, not money (grani.ru/opinion/portnikov/m.223017.html).

                “If they were afraid of you, then one neeed to be proud of [one’s country’s] rockets, sputniks and tanks,” even if the store shelves in Moscow and other Russian cities were empty, Portnikov argues.

            Now, three decades later, Schmidt on a visit to Moscow told Vladimir Putin that “one needs to say farewell to one’s neighbors “correctly.” Putin “only nodded in response,” as if he had not take note of the fact that “Germany and Russia hav not had a common border for seven decades.”

            But more to the point, the Moscow commentator says, Putin is “not sying farewell to the neighbors. He is buying them: 15 billion to Ukraine, two to Belarus and this is still not the limit.” He’ll spend more of Russia’s money to keep them in the Russian orbit: thus, “in place of Upper Volta with rockets has appeared Upper Volta with credits.”

            And the Kremlin leader will do this even if it means that soon “the Russian leadership will not have the money to pay” pensions or government employees. 

            But there is a big difference from Soviet times and now, Portnikov continues: “now the majority of Russians don’t want to pay.”  That is not only because the Russian economy is in trouble, and they think the money should be spent on their needs first, but also because they do not believe that such loans now will work any better than they did three decades ago.

            Those Russia is loaning money to won’t repay it, and to keep them in line by this means, Moscow will have to give them more and more, keeping enough at home only to beat up journalists who are too active, politicians the Kremlin doesn’t like, and creating “servile” television channesl and “falsified” elections – but not enough to pay Russians or their pensions.

            Portnikov’s argument is seconded by Moscow experts whom Anton Mardasov of “Svobodnaya pressa” surveyed last week and who insisted that if the Kremlin continues to give enormous sums of money to the post-Soviet states, it “risks having an empty budget trough” (svpressa.ru/politic/article/79816/).

                Vladimir Zharikhin, deputy head of the Moscow Institute of the CIS Countries, said that “if one considers Belarus an absolutely independent and sovereign state, then why are we giving it money? [But] if we consider this country as our closest ally” and as something like a Russian region in trouble, then “there is nothing terrible” in the loan Putin has given.

            Andrey Zaostrovtsev, an economist at Moscow’s Higher School of Economics, observed that “the leadership of the country is trying to restore a destroyed emprie. The president still has a strong nostalgia for the USSR.”  Consequently, he is prepared to give Belarus and Ukraine money – and it is important to recognize that these are subsidies rather than loans.

            The Kremlin leader, he continued, is “giving money without any conditions,” except the requirement that Ukraine’s leadership maintains “the existing social-economic and political model” of integration with Moscow rather than with Europe. It is unclear whether these loans or future ones will be sufficient for that.

            But what is of perhaps greater concern is whether Moscow will be able to continue to give away money like this, Zaostrovtsev said.  “The reserves and opportunities for Russia in the uture to presereve such an empire like the lost Soviet Union will continue to narrow,” despite Putin’s desires.

            Moreover, the Russian president is spending enormous sums for the defense ministry “as if we intend to fight with the entire world.”  As a result, the economist concluded, “sooner or later,” Russia will face “a dead end, out of which it will have to find a way for itself,” something that will be all the more difficult if money continues to flow abroad.

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