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Kudrin Returns?

Why did Putin bring Alexey Kudrin back?

Alexander Mercouris

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The announcement that former Russian Finance Minister Alexey Kudrin has been appointed deputy head of Russian President Putin’s Council of Economic Advisers has provoked a stir.

This is not surprising. Few individuals in Russian politics polarise opinion as strongly as Kudrin does.

Kudrin’s admirers are to be found in the business community, amongst liberal economists and amongst people of generally elite backgrounds and liberal views. Amongst people of this sort Kudrin’s reputation is of the highest.

The wider Russian population – to the extent it is aware of him – however views Kudrin very differently, whilst his name is anathema across the very large “patriotic/left wing” section of Russia’s political spectrum

So who is Alexey Kudrin and why does he arouse such strong feelings? Kudrin was Russia’s Finance Minister from 2000 to 2011 as well as the Deputy Prime Minister in overall charge of the economy from 2007 to 2011.

Amongst his liberal admirers Kudrin is the official who is widely credited with engineering the economic boom Russia experienced during Putin’s first two terms as President. He is lauded for his rigidly orthodox free market economic thinking, his tight fiscal management, his refusal to run deficits, and for Russia’s early repayment of its sovereign debt just a few years after its humiliating default in 1998.

Above all he is credited with the creation of Russia’s two national savings funds, the Reserve Fund, which funds the national budget when it is in deficit, and the National Welfare Fund, which acts as Russia’s sovereign wealth fund.

Kudrin’s glowing reputation amongst people of elite and liberal backgrounds both in Russia and abroad is well illustrated by the awards they have showered on him.

He was named “Best Finance Minister of the Year 2005” by The Banker magazine, “Best Finance Minister of a Developing European Country”; in 2006 by the Emerging Markets newspaper (a journal published by the IMF and the World Bank) and “Best Finance Minister of the Year 2010” by Euromoney magazine.

Kudrin’s Russian critics have a very different view of him. They see him as a doctrinaire laissez faire Atlanticist, as the Finance Minister whose dogmatic insistence on cutting spending strangled the economy, causing its productive sectors to wither away as money which should have been used for investment was instead accumulated uselessly, becoming “dead money” in the two Funds.

In addition many Russians have not forgotten or forgiven Kudrin’s monetisation in 2005 of many of their Soviet era social security benefits, turning them from benefits in kind into benefits paid in money.

Given Russia’s historically high inflation and its two periods of hyperinflation in the 1990s this understandably was a very unpopular move and one which provoked widespread protests. Though in the West these protests are largely forgotten, they actually involved more people than the much better known protests which took place during the election season in 2011-2012.

Kudrin is also known to be a supporter of increasing the pension age – another reform that is for equally understandable reasons also very unpopular with many Russians. Beyond these very practical criticisms, much of the hostility to Kudrin within Russia has a distinct ideological hue.

In a country where opinion polls show a clear majority of the population favours a planned economy it is unsurprising that the man who was known as the most prominent economic liberal in the government became unpopular with many people. Russians also tend to conflate support for liberal economic policies with pro-Western political positions. As Russia’s relations with the West have deteriorated this has inevitably exposed economic liberals like Kudrin to charges that they are part of a pro-Western Fifth Column. In Kudrin’s case some of his actions have lent force to these fears.

Lastly but crucially, for many Russians an economic liberal like Kudrin who supports private business and private enterprise is almost by definition an apologist for the system that created the oligarchs – the hated class of plutocrats who emerged in Russia during the corrupt privatisations of the 1990s.

All these factors taken together explain why the individual who in the West was the most highly regarded official of Putin’s government in Russia is one of its least popular. The truth about Kudrin is that both the praise he gets and some – though not all – the criticism is overdone.

Kudrin as Finance Minister did indeed run a tight ship. He did indeed create the two Funds which did indeed help keep the economy stable by financing the budget deficit after the financial crash of 2008.

However the praise for Kudrin’s tight fiscal management ignores the fact that fiscal policy has been no loser since he left the government in 2011. On the contrary the high oil prices in 2012 and 2013 enabled the government to avoid running deficits in those years even though Kudrin before his dismissal had actually planned for them.

Since then the government has managed to run lower deficits during the current recession than those Kudrin ran and planned for during the 2008 crisis. In 2015 the federal deficit was just 2.4% of GDP and though it will probably be higher this year the target is still 3% of GDP.

If Kudrin is a fiscal conservative and a supporter of balanced budgets the record shows his successors also are. In the Russian government and in the Finance Ministry, Kudrin’s fiscal conservatism is not the exception. It is the rule.

This point about Kudrin that is consistently overlooked by his admirers is that whilst he was a member of the government he worked as part of a team. The head of that team was not Kudrin but Putin.

It is Putin not Kudrin who must ultimately take the credit – or blame – for the tough fiscal discipline of the Kudrin years. It is because of Putin’s heavy emphasis on budget discipline that budget spending has continued to be tight since Kudrin left the government in 2011. It was also Putin more than Kudrin who insisted on early repayment of Russia’s debt.

As for the idea of setting up the two Funds, credit – or blame – for that does belong to Kudrin. However it could not have happened without Putin’s support. One must resist the temptation – irresistible to Kudrin’s admirers – of giving Kudrin all the credit for everything that went right under his watch whilst putting all the blame on Putin for everything that went wrong.

If one believes that keeping tight control of budget spending, accumulating reserves and paying off debt is the hallmark of a good manager, then the record shows the good manager in Russia’s case is Putin not Kudrin and that it is Putin not Kudrin who should be given the credit.

In fact Kudrin’s record as an economic manager is decidedly mixed. It is certainly true that Russia’s economy grew rapidly during Putin’s first two terms when Kudrin was Finance Minister and that Kudrin’s success in restoring order to Russia’s previously chaotic budget played a role in this.

However though Kudrin – with Putin’s support – kept a tight lid on government spending he was far too complacent about the borrowing and spending binge Russian companies were cranking up towards in the years immediately prior to the 2008 financial crash.

Several commentators warned at the time that the credit build-up – much of it in foreign currency loans from Western banks – was getting out of control. However the mounting concern appears to have passed Kudrin completely by. Presumably as an economic liberal and as a believer in the virtues of free enterprise he found it difficult to believe the private sector could do wrong.

The result was that the country found itself dangerously exposed in the weeks and months following the financial crash of 2008 as Western banks at the urging of their own central banks scrambled to get cash out of Russia as fast as they could by calling in their loans.

Money poured out of the country putting the very existence of some of the country’s biggest companies at risk. The panic fed on itself as investors then also began to pull out of Russian companies causing Russia’s two stock markets to crash. For a few terrifying weeks it looked as if the entire economy was about to collapse.

In the event the reserves Kudrin and Putin had built up in the previous years proved sufficient to avert disaster, though the single thing that saved the economy… from a much more severe crisis was the sharp recovery in oil prices that took place in the spring of 2009.

Kudrin was obviously not solely to blame for all this. However as the country’s Finance Minister and as the man in overall charge of the economy he must bear the principal blame. At a crucial moment he took his eye off the ball and it was as much a matter of good luck as of good management that the country came through.

By contrast one of the reasons why the Russian economy has proved so resilient in the face of the sanctions and the 2014 oil price collapse is precisely because the lesson of those terrible months in 2008 and 2009 has been learnt. Instead of resuming their wild borrowing and spending spree when the crisis abated Russian companies and businesses instead – at the urging of their government – reined their borrowing and spending in as they moved to hedge and consolidate their positions.

The result was that this time round with the help of a certain amount of support from the government and the Central Bank they have been able to meet their debt obligations without undue strain and without the economy spiralling into crisis.

I would add in passing that the much discussed fall in the Russian growth rate since 2012 is in part a consequence of this process. Reining in borrowing and spending and consolidating positions has inevitably led to a cut in investment causing growth to slow. In other words the frenetic growth of the immediate period prior to the 2008 crash (which touched an annualised rate of 9% in the months preceding the crash) has had to be paid for by a lower growth rate since then.

None of these points are ever made by Kudrin’s admirers, just as when they claim – as they often do – that the Russian economy has been badly managed during Putin’s period as President so that the economy is supposedly insufficiently diversified they somehow manage to forget who was actually in charge of the economy during most of the time that Putin has been President.

This same exercise in selective memory comes up whenever the circumstances of Kudrin’s leaving the government are discussed. Kudrin’s admirers tend to claim that Kudrin left the government because of disagreements between him and Putin over defence spending. Kudrin supposedly was unhappy that defence spending was getting out of control and was becoming unaffordable. Putin supposedly refused to listen and

Kudrin therefore left the government rather than carry out a policy he considered irrational and unrealistic. No part of this is true. The true reason Kudrin was dismissed from the government was not because there was a row between him and Putin over defence spending. Kudrin was dismissed from the government because he made public his strong disagreement with Putin’s decision to appoint Dmitry Medvedev Prime Minister after the so-called “tandem switch” in 2011 when Putin and Medvedev swapped jobs, with Medvedev stepping aside from the Presidency to allow Putin to stand for the Presidency in the 2012 Presidential election and Putin in return nominating Medvedev to be his Prime Minister.

kudrin:medvedev

Alexey Kudrin with then President Dmitry Medvedev

What is strange about the claims Kudrin quit the government over defence spending is that his row with Medvedev which led to his dismissal was carried out in the most public way imaginable on national television for everyone to see. Kudrin started it all by saying on US television that he would not be able to stay in the government if Medvedev was appointed Prime Minister. There was then a public row between Medvedev and Kudrin in Russia shown in full view on national television during which an ashen-faced Kudrin asked for time to speak to Putin only to be sacked by Medvedev on the spot.

The issue of defence spending came up incidentally during the row as Kudrin searched for a reason to justify his objection to Medvedev’s becoming Prime Minister. The reason he hit upon was that he disagreed with Medvedev’s commitment to higher defence spending. He did not however exactly say it was completely unaffordable. Rather he said he wanted to spend more money on education instead.

As to the reasons for Kudrin’s objections to Medvedev’s appointment those to this day remain unclear. There were suggestions Kudrin was disappointed not to have been appointed Prime Minister himself.

There were also suggestions that he had come in for some criticism from within the government for his failure to foresee and pre-empt the 2008 financial crisis (see above) and that his position was already becoming shaky and that this provoked him to lash out.

It seems there was also a plan hatched by someone in the government (probably the Kremlin spin-doctor Vladislav Surkov) for Kudrin to leave the government to head a loyalist liberal pseudo-opposition party. It seems that Kudrin was unenthusiastic about this idea. However the fact it was floated at all shows that at the time of his dismissal the idea of Kudrin leaving the government was already in the air.

The true reason for Kudrin’s row with Medvedev is in fact obvious to anyone who watches the television film of their row: the two men detest each other. Quite why they do is unknown. Possibly it was rivalry for Putin’s favour and resentment by Kudrin that Medvedev – whom he obviously considers his inferior – was stealing a march on him.

Kudrin’s and Medvedev’s mutual dislike does however show one thing. This is that there is no united liberal Atlanticist bloc inside the government. At the time of their row Medvedev and Kudrin were widely credited with being the two most prominent liberal Atlanticists in the government.

Their all too evident mutual dislike however makes it all but inconceivable that they could forge a united front together. Having managed to get himself thrown out of the government in the most public way imaginable Kudrin then committed an action that deeply angered his former colleagues in the government and which has ever since fuelled widespread distrust of him in the country.

During the protests that followed the parliamentary elections in December 2011 Kudrin turned up and spoke at a liberal opposition rally on Sakharov Avenue in Moscow. By doing so he appeared to burn his bridges with the government and seemed to be aligning himself with the pro-Western liberal opposition against Putin.

Kudrin’s speech at the Sakharov Avenue rally in fact demonstrated something else: Kudrin’s complete lack of the most basic political skills needed by a successful politician. His speech at the rally was by common consent a disaster – a boring lecture from a former academic and technocrat that turned everybody off – very far from the rallying cry the situation demanded.

From that moment it was obvious to everyone including Kudrin himself that he could never successfully lead a political party or make himself a significant political force and that he represented no conceivable political threat or challenge either to Putin or to the government.

That realisation almost certainly explains Kudrin’s actions since then. Having realised that he had `no future as an opposition leader he began instead to try to work himself back into Putin’s favour.

The story of Kudrin’s career since then has been one of constant lobbying both by himself and by his supporters to bring him back into the government. Though during this period he regularly made coded criticisms of the government he always stopped short of direct attacks on it. The impression he gave was of someone who wanted the government to succeed but thought it was not being reformist enough. As is often the case with those in Russia who call for more reform he was vague about what was the reform he wanted but he tended to give the impression that he wanted to cut budget spending even more and wanted to raise the pension age.

It seems Kudrin finally persuaded Putin some months ago to bring him back and that the one issue that delayed his return was disagreement about the post he would be given.

In the event the post Kudrin was eventually given – deputy head of Putin’s Council of Economic Advisers – though important is advisory and hardly compares with the posts of Deputy Prime Minister and Finance Minister he held before he was sacked in 2011. If Kudrin held out for a more important position -as is likely – then he clearly didn’t get it. In fact it seems that both Medvedev and Sergey Ivanov (Putin’s Chief of Staff) vetoed any possibility of Kudrin being given executive posts either in government or in the Presidential Administration.

Why then did Putin bring Kudrin back?

There may have been an element… of political calculation behind the decision. Though Kudrin’s new post is hardly one of key importance his reappointment does carry important symbolism. It could be intended as a gesture to the West – where Kudrin is held in high regard – at a time when the anti-Russian policy the US and the EU have been following has been coming under increasing challenge.

More cynically, bringing Kudrin back into the fold might have been intended to keep him quiet and onside in the run-up to the pending parliamentary elections this autumn. More practically, it seems Kudrin is being asked to work on a national economic plan. Almost certainly this will include a recommendation to raise the pension age – a deeply unpopular measure which Putin is known however to have come round to. Possibly Putin is using Kudrin for political cover – looking to Kudrin to recommend an unpopular reform Putin realises is needed whilst setting Kudrin up as the fall guy who will take the flak if or rather when the measure is opposed.

However beyond these tough-minded political calculations personal factors have probably also played an important role. One must put aside the idea of major ideological differences between Putin and Kudrin. To the constant dismay of most of his supporters Putin’s record shows that he is a convinced economic liberal. Putin has never shown the slightest inclination to row back on the market reforms Russia has followed since the USSR’s collapse. If Kudrin is an economic liberal then the record shows Putin is one too.

As for Kudrin he is not quite the doctrinaire liberal or Atlanticist he is sometimes made out to be. He supported Putin’s action against Khodorkovsky and Yukos in 2004. As Deputy Prime Minister and Finance Minister he supported investment in Russia’s infrastructure. He also voiced support for the government’s policy of creating national champions in specific sectors of the economy.

Though a supporter of privatisation he never made this a fetish of his policy. Kudrin has also been careful not to challenge openly Putin’s foreign policy. Whatever his private thoughts on the matter he has never spoken out publicly against Crimea’s reunification with Russia. He surely knows that both for Putin and for the Russian public this question has become the touchstone of loyalty to the country.

Not only is there therefore enough common ground for Putin and Kudrin to work together in the future but there is a long history of close friendship and collaboration between them. Both Kudrin and Putin worked together in St. Petersburg in the 1990s for the city’s then mayor Anatoly Sobchak. Both Kudrin and Putin were then transferred to the Presidential Administration in Moscow when Sobchak failed to gain re-election in 1996. When Putin became the country’s President in 2000 he appointed Kudrin his Finance Minister and backed him in that post thereafter.

If there is one consistent pattern to Putin’s career it is his fierce loyalty to his friends even when – as in Kudrin’s case – that loyalty has not been fully reciprocated. It is probably Putin’s sense of friendship and loyalty to Kudrin which more than anything else explains his decision to bring him back.

Whether Putin’s feelings of friendship and loyalty to Kudrin will be enough to outweigh Kudrin’s unpopularity in the country and with many of his colleagues is another matter. On balance it is unlikely. However by bringing Kudrin back Putin has brought back into the fold an old friend and collaborator with a history of loyal service.

Should Putin decide to take a more liberal turn in managing the economy after the 2018 election Kudrin is there to help him take it. Whilst perennial rumours that Kudrin will become Prime Minister in place of Medvedev are probably misplaced, it is very much in character of Putin to move to keep his options open, and by bringing Kudrin back he has done just that.

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The mainstream media does not want you to think [Video]

It is difficult to tell if recent reports like this really represent a realization for the media, but this interview rings true nonetheless.

Seraphim Hanisch

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Several recent stories on Fox, Breitbart, and here on The Duran all address the increasingly obvious bias of the mainstream media with regard to news reporting. We discussed on The Duran how Chris Wallace of Fox News refused to hear details from White House Senior Policy Adviser Stephen Miller about why the recently declared National Emergency is in fact legitimate.

This piece revealed that the media is very actively trying to control and direct what information they want the public to hear, rather than truly reporting the news, or interviewing people to get their takes on things, and to perhaps fully interview all sides in a controversy and then let the American public decide for themselves what to think.

This used to exist in more gentlemanly debate programs in some fashion, such as with the TV debate program Point Counterpoint, but now, the bias of the reporter or of the network is the primary operator in determining the outcome of the interview, rather than the information that is available about the story.

This has helped create a news and information culture in the United States that is truly insane. As examples, consider these paraphrased headlines, all occurring within the last few years:

All of these are probably familiar to most readers. Many of them are still repeated and acted on as if they were real. But the articles we linked to behind most of these ledes are examples of the disproof, usually 100% disproof, of these. They are hoaxes, or reports built on circumstantial evidence without any proof, or in the worst cases, pure slander and propaganda.

One reporter for CBS news, 60 Minutes anchor Lara Logan, discussed this in an interview with retired Navy SEAL Mike Ritland, for his own podcast program, which was picked up by the MediaIte website. The video of her interview is quite lengthy but starting at about 02:14:00 there is a particular segment that the MediaIte writers called to attention. We include this segment in the video.

PARENTAL ADVISORY: The video is unrestricted in regards to language and there is some profanity. Parents, please listen first before letting your children watch this video.

A major point Mrs Logan makes here is that 85% of the employ of the mainstream media in the USA consist of registered Democrats. She also speaks forcefully against the use of stereotypes, and suggests the best place to start is actual facts. This means that most journalists are coming into this work with a bias, which is not set aside for the sake of the facts of the story.

Probably the most key point comes at 2:18:20 in the video is how Lara Logan is taught the way to discern whether or not someone in journalism is lying to you:

“Someone very smart told me a long time ago, that, ‘how do you know you are being lied to?’, ‘how do you know you are being manipulated?’, ‘how do you know there is something not right with the coverage?’, when they simplify it all, and there is no gray. There is no gray. It’s all one way.

“Well, life isn’t like that. If it doesn’t match real life, it is probably not. Something is wrong.”

Lara Logan then pointed out the comparison of the mainstream media’s constant negative coverage of President Trump against the reality of his work, that, regardless of one’s own personal bias, it does not match that everything the President does is bad. She also highlighted the point that one’s personal views should not come into how to report a news story.

Yet in our days, it not only comes into the story, it drives the narrative for which the story just becomes an example of “proof” that the narrative is “true.” 

Tucker Carlson talked vividly about the same characteristic on his program Monday night on Fox News.

He points out that the 3,000 yearly shooting in Chicago get very little news coverage, but that is because these are not as “useful” as the Jussie Smollett story is.

This is an example of using an event or a person’s actions to satisfy a politically biased propaganda narrative, rather than report the news.

This is not occasional, as the list of news headlines given above show. This is a constant practice across most of the mainstream media. Probably no one who gives interviews on the major networks is exempt, for even Mr. Carlson often resorts to cornering tactics when interviewing liberals in an apparent attempt to make the liberal look ridiculous and the point of view he espouses to look vindicated through that ridiculousness.

While this is emotionally invigorating for the Carlson fan who wants to see him “eviscerate” the liberal, it is very bad journalism. In fact, it is not journalism at all; it is sensationalism in a nasty sense.

It also insults the viewer, perhaps without them knowing it, because such reporting is the same as telling the viewer “WE ARE IN CONTROL!” and that the viewer must simply go along with the narrative given.

It is very bad when what should be information reporting, policy discussion, or debate becomes infected with this. Ideas, the product of (hopefully) rational and discursive reasoning, are pushed aside by pure emotion and mass sensationalism. Put metaphorically, it is the new look of bread and circuses, keeping the masses entertained while anything else might be happening.

Sometimes the motive for this is not so sinister. After all, we have a 24 hour news cycle now. In the 1970’s we didn’t. And in those times, the calibre of news reported was much higher. Reporting was far more careful. The Pulitzer Prize winners  Bob Woodward and Carl Bernstein did their incredible exposé on the doings of President Richard Nixon under the directorship of the Washington Post editor, which demanded triple-checking of everything, making sure that all information was factual, accurate and genuine. While the story was indeed sensational, more importantly, it was true.

Now we have a lot of sensation, but very little to zero truth. As an example, every one of the ledes linked above is not proven to be true, in fact the truth in many of these stories is the opposite of what the headline says.

This would not be much of a problem if the media lies were not absorbed and reacted on by their readers, listeners and viewers. But the fact is that there are a significant number of consumers of mainstream media news that do react to it. The Covington High School incident showed this in perhaps the most frightening way, with open calls for violence against teenagers and high school students, requested by professionals, people that are supposed to be adults, such as Kathy Griffin, Reza Aslan, and GQ writer Nathaniel Friedman, who called for these kids to be “doxxed”, which as we reported, is an action that can be deadly.

We are in the times where the love of many has gone cold, and all is about expediency and selfishness. While there are a few outlets and a few journalists that still retain interest in recording and disseminating the truth, the reality is that most of what is out there is tainted by the drive for attention and sensationalism.

The media that engages in such behavior is actually hurting people, rather than informing and helping them.

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Russia and China Are Containing the US to Reshape the World Order

China and Russia are leading this historic transition while being careful to avoid direct war with the United States.

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Authored by Federico Pieraccini via The Strategic Culture Foundation:


Fortunately the world today is very different from that of 2003, Washington’s decrees are less effective in determining the world order. But in spite of this new, more balanced division of power amongst several powers, Washington appears ever more aggressive towards allies and enemies alike, regardless of which US president is in office.

China and Russia are leading this historic transition while being careful to avoid direct war with the United States. To succeed in this endeavor, they use a hybrid strategy involving diplomacy, military support to allies, and economic guarantees to countries under Washington’s attack.

The United States considers the whole planet its playground. Its military and political doctrine is based on the concept of liberal hegemony, as explained by political scientist John Mearsheimer. This imperialistic attitude has, over time, created a coordinated and semi-official front of countries resisting this liberal hegemony. The recent events in Venezuela indicate why cooperation between these counter-hegemonic countries is essential to accelerating the transition from a unipolar to a multipolar reality, where the damage US imperialism is able to bring about is diminished.

Moscow and Beijing lead the world by hindering Washington

Moscow and Beijing, following a complex relationship from the period of the Cold War, have managed to achieve a confluence of interests in their grand objectives over the coming years. The understanding they have come to mainly revolves around stemming the chaos Washington has unleashed on the world.

The guiding principle of the US military-intelligence apparatus is that if a country cannot be controlled (such as Iraq following the 2003 invasion), then it has to be destroyed in order to save it from falling into Sino-Russian camp. This is what the United States has attempted to do with Syria, and what it intends to do with Venezuela.

The Middle East is an area that has drawn global attention for some time, with Washington clearly interested in supporting its Israeli and Saudi allies in the region. Israel pursues a foreign policy aimed at dismantling the Iranian and Syrian states. Saudi Arabia also pursues a similar strategy against Iran and Syria, in addition to fueling a rift within the Arab world stemming from its differences with Qatar.

The foreign-policy decisions of Israel and Saudi Arabia have been supported by Washington for decades, for two very specific reasons: the influence of the Israel lobby in the US, and the need to ensure that Saudi Arabia and the OPEC countries sell oil in US dollars, thereby preserving the role of the US dollar as the global reserve currency.

The US dollar remaining the global reserve currency is essential to Washington being able to maintain her role as superpower and is crucial to her hybrid strategy against her geopolitical rivals. Sanctions are a good example of how Washington uses the global financial and economic system, based on the US dollar, as a weapon against her enemies. In the case of the Middle East, Iran is the main target, with sanctions aimed at preventing the Islamic Republic from trading on foreign banking systems. Washington has vetoed Syria’s ability to procure contracts to reconstruct the country, with European companies being threatened that they risk no longer being able to work in the US if they accept to work in Syria.

Beijing and Moscow have a clear diplomatic strategy, jointly rejecting countless motions advanced by the US, the UK and France at the United Nations Security Council condemning Iran and Syria. On the military front, Russia continues her presence in Syria. China’s economic efforts, although not yet fully visible in Syria and Iran, will be the essential part of reviving these countries destroyed by years of war inflicted by Washington and her allies.

China and Russia’s containment strategy in the Middle East aims to defend Syria and Iran diplomatically using international law, something that is continuously ridden roughshod over by the US and her regional allies. Russia’s military action has been crucial to curbing and defeating the inhuman aggression launched against Syria, and has also drawn a red line that Israel cannot cross in its efforts to attack Iran. The defeat of the United States in Syria has created an encouraging precedent for the rest of the world. Washington has been forced to abandon the original plans to getting rid of Assad.

Syria will be remembered in the future as the beginning of the multipolar revolution, whereby the United States was contained in military-conventional terms as a result of the coordinated actions of China and Russia.

China’s economic contribution provides for such urgent needs as the supply of food, government loans, and medicines to countries under Washington’s economic siege. So long as the global financial system remains anchored to the US dollar, Washington remains able to cause a lot of pain to countries refusing to obey her diktats.

The effectiveness of economic sanctions varies from country to country. The Russian Federation used sanctions imposed by the West as an impetus to obtain a complete, or almost autonomous, refinancing of its main foreign debt, as well as to producing at home what had previously been imported from abroad. Russia’s long-term strategy is to open up to China and other Asian countries as the main market for imports and exports, reducing contacts with the Europeans if countries like France and Germany continue in their hostility towards the Russian Federation.

Thanks to Chinese investments, together with planned projects like the Belt and Road Initiative (BRI), the hegemony of the US dollar is under threat in the medium to long term. The Chinese initiatives in the fields of infrastructure, energy, rail, road and technology connections among dozens of countries, added to the continuing need for oil, will drive ever-increasing consumption of oil in Asia that is currently paid for in US dollars.

Moscow is in a privileged position, enjoying good relations with all the major producers of oil and LNG, from Qatar to Saudi Arabia, and including Iran, Venezuela and Nigeria. Moscow’s good relations with Riyadh are ultimately aimed at the creation of an OPEC+ arrangement that includes Russia.

Particular attention should be given to the situation in Venezuela, one of the most important countries in OPEC. Riyadh sent to Caracas in recent weeks a tanker carrying two million barrels of oil, and Mohammed bin Salman (MBS) has taken a neutral stance regarding Venezuela, maintaining a predictable balance between Washington and Caracas.

These joint initiatives, led by Moscow and Beijing, are aimed at reducing the use of the US dollar by countries that are involved in the BRI and adhere to the OPEC+ format. This diversification away from the US dollar, to cover financial transactions between countries involving investment, oil and LNG, will see the progressive abandonment of the US dollar as a result of agreements that increasingly do away with the dollar.

For the moment, Riyadh does not seem intent on losing US military protection. But recent events to do with Khashoggi, as well as the failure to list Saudi Aramco on the New York or London stock exchanges, have severely undermined the confidence of the Saudi royal family in her American allies. The meeting between Putin and MBS at the G20 in Bueno Aires seemed to signal a clear message to Washington as well as the future of the US dollar.

Moscow and Beijing’s military, economic and diplomatic efforts see their culmination in the Astana process. Turkey is one of the principle countries behind the aggression against Syria; but Moscow and Tehran have incorporated it into the process of containing the regional chaos spawned by the United States. Thanks to timely agreements in Syria known as “deconfliction zones”, Damascus has advanced, city by city, to clear the country of the terrorists financed by Washington, Riyadh and Ankara.

Qatar, an economic guarantor of Turkey, which in return offers military protection to Doha, is also moving away from the Israeli-Saudi camp as a result of Sino-Russian efforts in the energy, diplomatic and military fields. Doha’s move has also been because of the fratricidal diplomatic-economic war launched by Riyadh against Doha, being yet another example of the contagious effect of the chaos created by Washington, especially on US allies Israel and Saudi Arabia.

Washington loses military influence in the region thanks to the presence of Moscow, and this leads traditional US allies like Turkey and Qatar to gravitate towards a field composed essentially of the countries opposed to Washington.

Washington’s military and diplomatic defeat in the region will in the long run make it possible to change the economic structure of the Middle East. A multipolar reality will prevail, where regional powers like Egypt, Turkey, Saudi Arabia and Iran will feel compelled to interact economically with the whole Eurasian continent as part of the Belt and Road Initiative.

The basic principle for Moscow and Beijing is the use of military, economic and diplomatic means to contain the United States in its unceasing drive to kill, steal and destroy.

From the Middle East to Asia

Beijing has focussed in Asia on the diplomatic field, facilitating talks between North and South Korea, accelerating the internal dialogue on the peninsula, thereby excluding external actors like the United States (who only have the intention of sabotaging the talks). Beijing’s military component has also played an important role, although never used directly as the Russian Federation did in Syria. Washington’s options vis-a-vis the Korean peninsular were strongly limited by the fact that bordering the DPRK were huge nuclear and conventional forces, that is to say, the deterrence offered by Russia and China. The combined military power of the DPRK, Russia and China made any hypothetical invasion and bombing of Pyongyang an impractical option for the United States.

As in the past, the economic lifeline extended to Pyongyang by Moscow and Beijing proved to be decisive in limiting the effects of the embargo and the complete financial war that Washington had declared on North Korea. Beijing and Moscow’s skilled diplomatic work with Seoul produced an effect similar to that of Turkey in the Middle East, with South Korea slowly seeming to drift towards the multipolar world offered by Russia and China, with important economic implications and prospects for unification of the peninsula.

Russia and China – through a combination of playing a clever game of diplomacy, military deterrence, and offering to the Korean peninsula the prospect of economic investment through the BRI – have managed to frustrate Washington’s efforts to unleash chaos on their borders via the Korean peninsula.

The United States seems to be losing its imperialistic mojo most significantly in Asia and the Middle East, not only militarily but also diplomatically and economically.

The situation is different in Europe and Venezuela, two geographical areas where Washington still enjoys greater geopolitical weight than in Asia and the Middle East. In both cases, the effectiveness of the two Sino-Russian resistance – in military, economic and diplomatic terms – is more limited, for different reasons. This situation, in line with the principle of America First and the return to the Monroe doctrine, will be the subject of the next article.

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Nearly assassinated by his own fighters, al-Baghdadi and his caliphate on its last legs (Video)

The Duran – News in Review – Episode 178.

Alex Christoforou

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The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris discuss how the Islamic State has been rapidly losing territory over the last two years in Syria and Iraq, due to efforts by Russian and Syrian forces, as well as the US and their Kurdish allies.

The jihadist caliphate has lost most of its forces and resources, leading it to go into hiding.

Al-Masdar News is reporting that Daesh* leader Abu Bakr al-Baghdadi was reportedly attacked in a village near Hajin by some of the terrorist organisation’s foreign fighters in an apparent coup attempt, The Guardian reported, citing anonymous intelligence sources. Baghdadi reportedly survived the alleged coup attempt, with his bodyguards taking him into hiding in the nearby desert.

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Meanwhile European leaders are shocked at US President Trump’s ISIS ultimatum. Via Zerohedge

After President Trump’s provocative tweets on Sunday wherein he urged European countries to “take back” and prosecute some 800 ISIS foreign fighters as US forces withdraw from Syria, or else “we will be forced to release them,” the message has been met with shock, confusion and indifference in Europe. Trump had warned the terrorists could subsequently “permeate Europe”.

Possibly the most pathetic and somewhat ironic response came from Denmark, where a spokesperson for Prime Minister Lars Lokke Rasmussen said Copenhagen won’t take back Danish Islamic State foreign fighters to stand trial in the country, according to the German Press Agency DPA“We are talking about the most dangerous people in the world. We should not take them back,” the spokesperson stressed, and added that the war in Syria is ongoing, making the US president’s statement premature.

Germany’s response was also interesting, given a government official framed ISIS fighters’ ability to return as a “right”.  A spokeswoman for Germany’s interior ministry said, “In principle, all German citizens and those suspected of having fought for so-called Islamic State have the right to return.” She even added that German ISIS fighters have “consular access” — as if the terrorists would walk right up to some embassy window in Turkey or Beirut!

Noting that the Iraqi government has also of late contacted Germany to transport foreign fighters to their home country for trial, she added, “But in Syria, the German government cannot guarantee legal and consular duties for jailed German citizens due to the armed conflict there.”

France, for its part, has already agreed to repatriate over 130 French Islamic State members as part of a deal reached in January with US-backed Syrian Democratic Forces (SDF) who are holding them, after which they will go through the French legal system. However, French Secretary of State Laurent Nuñez still insisted that the west’s Kurdish allies would never merely let ISIS terrorists walk out their battlefield prisons free.

“It’s the Kurds who hold them and we have every confidence in their ability to keep them,” Nuñez told French broadcaster BFMTV on Sunday. “Anyway, if these individuals return to the national territory, they all have ongoing judicial proceedings, they will all be put on trial, and incarcerated,” he said, in comments which appeared to leave it up to others to make happen.

And representing the Belgian government, Justice Minister Koen Geens charged Trump with blindsiding his European allies with the demand, which included Trump underscoring that it is “time for others to step up and do the job” before it’s too late. “It would have been nice for friendly nations to have these kinds of questions raised through the usual diplomatic channels rather than a tweet in the middle of the night,” Geens said during a broadcast interview on Sunday, according to the AFP.

Meanwhile in the UK the issue has recently become politically explosive as debate over so-called British jihadist bride Shamima Begum continues. The now 19-year old joined Islamic State in 2015 after fleeing the UK when she was just 15. She’s now given birth in a Syrian refugee camp and is demanding safe return to Britain for fear that she and her child could die in the camp, so near the war zone.

Conservatives in Britain, such as Interior Minister Sajid Javid have argued that “dangerous individuals” coming back to the UK from battlefields in the Middle East should be stripped of their British citizenship. He said this option has already been “so far exercises more than 100 times,” otherwise he also advocates prosecution of apprehended returning suspects “regardless of their age and gender.”

Identified as French nationals fighting within ISIS’ ranks, via Khaama press news agency

The UN has estimated that in total up to 42,000 foreign fighters traveled to Iraq and Syria to join IS — which appears a very conservative estimate — and which includes about 900 from Germany and 850 from Britain.

SDF leaders have previously complained about the “lack the capacity” for mass incarceration of ISIS terrorists and the inability to have proper battlefield trials for them. Recent estimates have put the number of ISIS militants in US-SDF battlefield jails at over 1000, though Trump put the number at 800 in his tweet.

However, even once they do return to Europe it’s unclear the extent to which they’ll be properly prosecuted and locked in prison by European authorities.

For example, another fresh controversy that lately erupted in Britain involved a 29-year old UK woman who traveled to join ISIS, and was convicted for membership in a terrorist group upon her return to Britain. She was jailed on a six year sentence in 2016, but is now already walking free a mere less than three years after her conviction.

 

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