Tuesday, July 31, 2012

Putin Is Scared of Girls! Is He Losing It?

Commentators predicted that the weakened Vladimir Putin would compromise with his political opposition as he began his third (actually fourth) term as Russia’s head of state. Our pundits do not understand Putin. For “once-KGB-always-KGB” Putin, compromise is an admission of weakness. Opposition is to be crushed, not bargained with. If  one hundred thousand demonstrators go on the streets, beat some of them arrest some, fine them a year’s salary, or jail them as “inciters of mass disorder.”  If anti-corruption bloggers attract too large an audience, pass anti-defamation laws, harass and interrogate then, and then stick them in jail to rot. If investigative reporters get too close, look the other way when they are murdered.

Putin’s persecution targets to date have been grown ups, such as  Oligarch Mikhail Khodorkovsky, popular anti-corruption blogger Alexei Navalny, investigative reporter (deceased) Anna Politovskaya, Chess master Gary Kasparov, or ex-KGB (deceased) Alexander Litvinenko. Putin’s new enemies are young, na├»ve, and often female. Muscular, rock-ribbed, macho Putin is picking fights with girls! This doesn’t look good.

On February 21, Putin’s security forces arrested three members of the Pussy Riot feminist band, baklavas covering their faces, as they entreated the Virgin Mary to “get rid of Putin” in a “happening” performance in the Moscow’s Christ the Savior Cathedral. Two band members escaped underground, where they are available for interviews. The arrested Pussy Riot girls –Nadya, Katya, and Masha -- are in their early twenties. They have husbands. Two have young children. In April, Amnesty International declared them prisoners of conscience.

go to forbes.com

Thursday, July 26, 2012

Sting, Flea, and Franz Ferdinand Against Putin: Who Will Win?

Rockers of the world are uniting against Putin’s arrest and incarceration of  the Pussy Riot punk rock group.

“Flea” promises the band members – Nadya, Katya and Masha – “his finest energy” and prayers for their release. He will “try to make as many people aware as I can.” Anthony Kiedes writes: “We love you, support you and are here to help you.” Alex Kapranos sends his support and complains that “Any leader of a country who claims to be a fan of the Beatles and Elton John and then imprisons contemporary musicians who are expressing their personal political views are dangerous hypocrites.” He seems to have gotten that right. Apparently Sting has lent his name to the protesters.

Pussy Riot’s crime was to play what they called a punk prayer, "Mother of God, Cast Putin Out!" inside Moscow's Christ the Saviour Cathedral in February. Nadya, Katya and Masha have been in jail since early March. Their trial is scheduled for the end of July and they face jail sentence of up to seven years. 

Putin has enlisted his ally Patriarch Kirill, the head of the Orthodox Church to condemn Pussy Riot as the devil. 

Sunday, July 22, 2012

Syria, China, Russia, Reset, Magnitsky

Sunday, July 22:
The forces of Syrian dictator Basher Assad shell rebel-occupied neighborhoods of Damascus. Four young female members of a punk rock band begin their fifth month in a Moscow jail. Somewhere in China a local party boss meets with disaffected factory workers. In Washington,  the full house prepares to vote on visa restriction for Russian officials for human rights abuses. These disparate events are part of a larger mosaic, which begins in Syria.

Basher Assad, like his father before him, symbolizes unconstrained dictators prepared to do anything, no matter how odious, to stay in power. Unconstrained dictators use their secret police, militias, and armies to arrest, torture, and kill opponents. They raze whole towns. They kill innocent women and children to send a message. They are indifferent to world outrage. If Assad falls, it will not be for lack of brutality and atrocity. He may resort to chemical weapons as a last resort.

Constrained dictators, such as Mubarak, Pinochet, and the Shah, face limits imposed by moral qualms or the international community. Small protests swell, and momentum for regime change builds. Failure to use overwhelming force and efforts to compromise only embolden protesters, and eventually the constrained dictator resigns either to flee the country or to face local justice.

Two other constrained dictatorships, Russia and China, want to keep Assad in power. Both shudder at a fellow totalitarian regime falling to a disorganized opposition. They will abandon him (with great fanfare) only when it is clear that he has lost. China and Russia have their own disaffected minorities, disgruntled workers, and ideological opponents. Their one-party states lack legitimacy, and they know it. They consider themselves under constant threat, fearing the single spark that brings millions to the streets. They must snuff out any spark  — a lone barefoot lawyer or an 18 year old girl throwing a rock at security forces  –  that could conceivably ignite a Tahrir Square.

Russia and China’s one-party dictatorships face different threats. China’s Communist Party (CPC) must firefight grievance demonstrations. Putin, on the other hand, must confront direct challenges to his legitimacy.

go to forbes.com

Friday, July 20, 2012

Am I a Foreign Agent in Putin's Russia?

Russia's parliament recently adopted a requirement that all NGOs that receive funds from abroad register as a "foreign agent" (inostranny agent, as in the old days). International charities are ordering new stationery that identifies them as "foreign agents." I guess on my next visit to Russia, I might have to register as a foreign agent myself.

At least "foreign agent" does not carry the death penalty as it did under Stalin.

I guess Russia under Putin does not worry about the ham-fisted impression that such measures create. Oh well.

Wednesday, July 18, 2012

What If the Rich Really Gave Back as Obama Wants?

President Obama tells us that the rich should give back to society. He even knows many wealthy people who want to give back more. (I guess they can’t until their taxes are raised). We learn from him that the rich owe their success not to business acumen and risk taking but to public roads, schools, the courts, food stamps, disability payments, workplace regulation, and other government services. We even owe the first rumblings of the internet to DARPA, unfortunately the research arm of the military-industrial complex. (Or was it Al Gore?).  Obama feels it is only fair that the rich return what the government gave them. What business could survive without access by public road? Fair is fair, after all.

What would happen if we, like France’s socialist state, taxed away seventy five percent of earnings above one and a quarter million and  high-net-worth business executives with  $2.5 million in salary, dividends and rental property pay a marginal rate of 90.5 percent. At such rates, our rich would really be giving back to government what it is due, and perhaps more.  Fair is fair.

With so much “going back,” there is little reason to go forward. The “rich” should just cash in their chips, stop building their businesses or starting new ones, pay their high taxes, and live off their wealth, unless that is taxed away too. After all, the government can “invest” their money in Solyndras,  Volts, and entitlement programs. As Obama claims, government investment has higher returns than private investment.

If Steve Jobs had paid his fair share back to society after he made his first ten million, Apple today would today be a relatively small company worth less than a billion and employing a thousand or so. It would not be the world’s largest company in market cap, it would not employ 60,400 people worldwide, and we would not have the IPads, IPhones, Apps, and other innovative Jobs products, which improve the quality of lives and raise living standards. Apple shareholders would not hold shares worth a half trillion dollars.

go to forbes.com

Monday, July 16, 2012

Command Versus Market: Chinese Capital Markets At A Crossroad

China’s state capitalism is a messy mix of market, plan, and one-party rule. Less than half of the economy is directed by the state; the rest is private and market driven. Except for infrastructure and other nontradables, both Chinese economies operate in the world economy. Although not well known, China’s rapid growth derives primarily from private companies, despite the state policy of “state advance, private sector retreat.” The new leadership that takes command at the end of 2012 must decide whether to liberalize and privatize the state sector as advised by the World Bank’s China 2030 programs or bow to the entrenched interests of the state sector. How they decide will determine China’s long term growth.

China’s battle between plan and market is fought day by day on many fronts. What appears to be a minor dustup between the Ministry of Finance and the Securities Regulatory Commission over accounting practices for publicly traded companies is illustrative of the war between market and plan and between the private and state sector.

go to forbes.com

Thursday, July 12, 2012

News Trivia: Putin Finds a New Demographic: Gay Men

Vladimir Putin’s PR experts use photos of him bare-chested, horseback riding, judo fighting, assault rifle shooting, and  other macho activities to appeal to his demographic – women aged 40 and above.

Newspapers and other information sources claim that photos of the physically fit Putin have been circulating like wildfire through gay chat-rooms on the Internet.  On one such site there is an item entitled “Russian dictator seeks love,” in which Putin is referred to as "Pootie-Poot.”

I imagine that Putin’s growing following among this demographic group is another one of those unintended consequences of Russian political PR. 


Tuesday, July 10, 2012

18-year-old Girl Incites Mass Disorder: Putin’s Enemy of the People

According to the Putin News Network, dangerous enemies of the people maimed and wounded burly and heavily armored OMON security forces during the May 6, 2012 demonstrations in Moscow. Their weapon of choice: rocks and pieces of asphalt.

Among the most ferocious of the “inciters of mass disorder” was one 18-year-old Alexandra Dukhanina, captured by TV crews throwing an undesignated object, presumably in the direction of the OMON security forces. Russia’s NTV shows Alexandra being  hauled to a paddy wagon by  a security officer, lifting her off the ground with a strangle-hold around her neck. 

Alexandra is next shown in the accompanying photo in a prison cell in handcuffs.

Clearly that is where such enemies of public order belong. NTV camera crews show a bleeding OMON officer leaving the scene of the demonstration to join a number of his wounded colleagues lounging in hospital beds, bored with no apparent injuries. At least they bravely defended society against those who threaten the “stability” that President Putin has promised.

Next NTV shows Alexandra’s friends being interviewed. They say, to their regret, that she used to be a normal girl until she fell under the influence of the cult of demonstrators.

Alexandra has been released to Chinese-like house arrest. She is not allowed to telephone or use her computer. If convicted she can serve seven years in jail. Light punishment for an inciter of mass disorder.

For those who wish to see Alexandra and her vile deeds, click here.

1.03-1.26    riots, bloody security forces in hospital
1.37 -2.37 Alexandra being hauled off, Alexandra throwing an object

Note Putin’s strategy: Arrest, manhandle, and threaten with prison ordinary participants in demonstrations, not the leaders. Putin wants to raise the cost to individual protestors to keep the demonstrations small.

Sunday, July 8, 2012

Challenge for the American Left: Go on Record For Hollande's Socialist Program

During the French presidential campaign, pundits assured us that Francois Hollande was simply playing to his socialist base. Once in office, he’d prove to be a pragmatist. All his talk of 75 percent income tax rates, wealth surcharges, infrastructure banks, new taxes on dividends, hiring more public employees, not giving an inch on entitlements, and punishing the financial sector was just talk. Two months later, we know Hollande meant every word. Armed with a solid parliamentary majority, he is carrying out his socialist agenda, no holds-barred.

It is time for our anti-austerity, pro-stimulus, and ueber-fairness crowd to go on record in support of Hollande. I’d like to count them when the French economy goes down the toilet, as it certainly will unless Hollande changes course.

The American Left counts among Hollande’s many cheerleaders. At long last, a leader of France is standing up to the austerity crowd. Liberal New York Times columnist, Paul Krugman, rails against the Hollande hysteria of the staid Financial Times and the stingy Germans. Per Krugman: we need not fear someone who genuinely believes in the need for a fair society, and we know the mess we get into when the government does not run things.  By ignoring the austerity nonsense, Hollande offers the “possibility of something better” not only for “new Keynesians and old socialists” but for France, Europe, and the world economy.

As they say, time will tell.

go to forbes.com

Wednesday, July 4, 2012

What Happened to the Courageous Whistle Blower in the Khodorkovsky Case?

In February of last year, I wrote a blog on Moscow court employee, Natalia Vasilieva, who blew the whistle on the second Khorkovsky trial. She revealed in a television interview that the Khodorkovsky verdict was sent over to her boss, the judge, by higher authorities. Despite his own reservations, the judge sentenced Khodorkovsky to a second jail term as ordered. She was immediately fired and threatened with a defamation suit by the judge.

She was recently interviewed by a dissident producer:

            “Did they drive you from work?”
“Whom did you like most of all in the court?”
As she left the interview, everyone tried to shake her hand. “Are you not working now?” Asked one. “No,” she answered. By the way, her husband is also not able to get a job.

Natalia Vasilieva is an example of Putin’s use of “soft power.”  His soft power is becoming harder and more violent.

America, July 4, 2012: A 60/40 Citizenry that Votes 50/50

On November 6, 2012 American voters face an unusually stark choice. A vote for Obama is an affirmation of the expansion of size, scope and mission of the federal government, more income redistribution, a limiting of the rights of states, and a distrust of private enterprise to solve the nation’s problems. Romney offers the vision of a more limited federal government, less redistribution, more power and responsibility to the states, and confidence in the private sector. Obama views the United States of America as no better or worse than the affluent countries of Europe. Romney imparts a belief in  American exceptionalism and old-fashioned patriotism. Romney is less likely to be satisfied with the state of American moral values than Obama.
Some sixty percent of the American people share Romney’s Weltanschaung. Forty percent share Obama’s. A Romney victory should be a slam dunk, especially given the sorry economy, but it is too close to call.
The following polling results from mainstream polling organizations bring home my point about a strong majority of the American people being Romney’s natural constituency:

go to forbes.com

Monday, July 2, 2012

Obama Care Will End Drug Advances and Europe's Free Ride (Unless China Steps in)

Ninety five percent of the new drugs coming on the market are developed for sale in the United States. They are paid for by American consumers, while other countries, such as Canada, Germany and France, free ride at our expense. The United States is the last major country that allows the market to set prices high enough to compensate pharmaceutical companies for their R&D investments. Obama Care will increasingly control pharmaceutical prices as costs rise and federal and state funds fall short. Major pharmaceutical advances will stop (How well will government labs work?), and the rest of the world will lose along with Americans.
The negative media pharmaceutical narrative reminds me of the boy who visited a museum noted for its dinosaurs, who afterwards could only talk about the teensy-weensy insect he saw in a glass case.  Little details caused him to miss the dinosaur.  The same lesson applies to the pharmaceutical industry – or “Big Pharma” as its critics call it. Yes, pharmaceutical companies do develop “me-too” drugs, use human subjects from the third world (Do you want to volunteer?), may cajole family physicians to prescribe drugs we do not need, and picture tranquil sleep, unobstructed breathing, and reliable erections in their TV spots. But these images of “Big Pharma” are the equivalent of the tiny insect that fascinates the boy who fails to notice the dinosaurs.

go to forbes.com