Andrei Piontkovsky: Putin’s net worth estimated at over $100 Billion

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2014/07/23 - 06:08 • Analysis & Opinion, News, Political News, Politics, Russia, Ukraine

 

About the author

Andrei Andreyevich Piontkovsky (b. June 30, 1940, Moscow) is a Russian scientist, political writer and analyst.

He graduated from the Mathematics Department of Moscow State University and has published more than one hundred scientific papers on applied mathematics.

He was Executive Director of the Strategic Studies Center (Moscow) think tank that has been closed since 2006.  He contributes regularly to Novaya Gazeta, the Moscow Times, Russia Journal and online journals Grani.ru and Transitions Online.  He is also a regular political commentator for the BBC World Service and Radio Liberty in Moscow.  He has been an outspoken critic of Putin’s “managed” democracy in Russia and has described Russia as a “soft totalitarian regime.”

Piontkovsky is a member of the American Mathematical Society and the International Writers Association’s PEN Club.

Piontkovsky is the author of several books on the Putin presidency in Russia, including his most recent book, Another Look Into Putin’s Soul.

As one of the 34 first signatories of the online anti-Putin manifesto “Putin Must Go”, published on March 10, 2010, he has repeatedly stressed its importance and urged others to sign it.

– Andrei Andreyevich, the most recent approval rating for Putin is 86%, which is a historic maximum. However, Lev Gudkov, the head of “Levada-Center” [a Russian independent, non-governmental polling and sociological research organization – DU] reckons that this rating won’t hold for long: after a couple of months, the euphoria will evaporate due mainly to forthcoming economic hardships.  In your opinion, which of the two scenarios will be adopted – “inertial” (“let it be”) or “forced” (“decisive steps”)?

– Economic hardships are indeed evident, and social hardships will also become evident in the near future.  This year is going to be the first year with negative economic growth.  Also, if Putin triggers sectoral economic sanctions, this would turn into an economic catastrophe, which will rapidly turn into a social catastrophe.  But, I think that the “inertial” scenario will be adopted.  What kind of “decisive steps” can there be?  Rejection of the US Dollar and adoption of Yuan?  Nationalization of industrial and agricultural sectors?  Those are the proposals of top advisors.  But those “decisive steps” will only bring the catastrophe closer.  I believe that in any case, our top leadership understands that.

Top leadership is powerless to change anything because stagnation is in the nature of our economic system.  It is very peculiar – it is neither socialism nor capitalism, because it lacks the main element – the inviolobility of private property.  Any property is held conditionally – it depends on your relationship with the government, your administrative resource [the ability to use one’s official positions or connections to government institutions to influence outcomes – DU], and it can be liquidated at any moment, and the other way around – if you’re a friend of the President, you won’t have to worry about your economic well-being.  Today, these tendencies are irreversible, and I don’t think that the government will break its back to implement “decisive measures” facilitate its own end.

– Nikolai Starikov, a writer, says if we want our economy to grow like in China, we must have the same political system as in China. Now is the time to adopt Chinese political practices: we did turn away from the West to China.  Do you envision us having the Chinese one-party system with certain possibilities for free economic activity?  Perhaps some variation of Lee Kuan Yew’s authoritarian regime with his “Singaporean economic wonder” is viable?

– It’s good that you mentioned Lee Kuan Yew.  In addition to his reform activities, he is famous for his wonderful statements.  Once he was asked what was the hardest obstacle for reform.  His response:  sending five of his closest friends to jail.  Vladimir Vladimirovich [Putin – DU] will never do it, he will never jail the Ozero co-operative [a co-operative society allegedly organised on November 10, 1996 by Vladimir Putin among others, as a co-op for the summer homes. – DU].

Regarding the Chinese model, first, we don’t have so many “Chinese” who are eager to work for a dollar per month.  Secondly, even though the Chinese political system is authoritarian, it changes its leadership no less effectively than America:  no one can be in office for more than two terms, and personal dictatorship is not a threat for the Chinese.  Third, as I’ve mentioned before, business success in our country is determined not by your talent, but by how close you are to the President and the budget:  all of our big “businessmen” – the Kovalchuk brothers, Rotenberg, Timchenko are Putin’s friends.  People like these are executed in between soccer matches in China.  And there are also several million Chinese;  no matter where they work – in America or Australia – they always remain Chinese and bring new, advanced technologies and financial resources back to the country.  It’s the other way for us:  talent and capital is fleeing the country.

We will become China, but in a somewhat different way – by China absorbing the Far East and Siberia.  I think you even feel it in Ural.  Our most prominent sinologist, Vilya Gelbras, published a book about Chinese migration policy ten years ago.  He states that their migration seems spontaneous.  In reality, however, it is approved by the Chinese Politburo:  which Russian cities and regions are going to be covered by the next wave of migration.  And now, after we signed those shameful gas agreements with China, this has gone so far that at the St. Petersburg economic forum, literally two days after Putin’s Shanghai visit, the Vice President of PRC, Li Yuanchao, voiced something Chinese have never dared to: you Russians, so to speak, have large territories, but few people, and we have few territories but many hardworking Chinese – let’s unite the Chinese North and the Far East and Siberia into a single economic zone.  They are not even hiding their intentions anymore.

– A reader wonders whether the gas contract with China is the finale of Putinomics [Putin’s economic policies – DU] or not.

– It is not the finale, it is a drug injection.  There are many articles indicating that the agreed-upon price for the Russian gas does not include field development and pipeline construction, meaning that the actual price will be less, and the Chinese are going to drop it further in 30 years.  What made our officials go for it, what seduced them into signing it?  Getting $25B in cash immediately – a pittance which saves the day (it covers Crimea expenses, a possible war with Ukraine, etc.)  This is not the only “ignorant agreement” with the Chinese:  a similar oil agreement was signed by Sechin [a close friend of Putin, the Executive Chairman of Rosneft, a Russian integrated oil company – DU].  There are around a hundred of those agreements to develop the whole periodic table of elements, involving Chinese labour and refineries.  Similar agreements are signed by African countries with China;  but this agreement [the natural gas contract] is a guarantee of political and physical survival of the Putin regime.  Any other government, be it liberal, nationalist, or wishy-washy, will cancel those agreements, which is why China supports the Putin regime in any way it can, and, if needed, in case serious problems arise or there is unrest, I believe that China will support it militarily.

– But, all in all, for a country, at the end of the day, this is a road to the loss of sovereignty.  According to you, the most important issue to start with is eradicating corruption, not only local, as it is now, but also from up top.  The Chairman of National Anti-corruption Committee Kirill Kabanov believes that Putin has no other choice, since the scope of corruption is already threatening the economy and his personal power.  Or is Putin more afraid of the corrupted elites’ conspiracy against him?

– I always reiterate that “corruption” is a completely incorrect term in relation to the Russian economic and political system.  Corruption happens when a businessman bribes an official to receive preferential treatment.  Namely, for corruption to occur, one must have two subjects. In our big business, businessman and official are the same:  Putin’s net worth is estimated at above $100B.  Putin doesn’t need to bribe Putin to receive preferential treatment for the businesses he controls – Abramovich’s “obshchag” [in Russian slang, a mutual assistance fund for criminally affiliated individuals, here used as unofficially mutually owned wealth – DU], meaning those $13B he allegedly received for “Sibneft” [Now “Gazprom Neft”, the fourth largest oil producer in Russia;  ranked third according to refining throughput; subsidiary of Gazprom. Majority stake sold by Abramovich in Oct. 2005 – DU], or Timchenko’s “obshchag”, who until recently was selling 50% of Russia’s oil, receiving it almost for free.  This is not corruption;  this is a complete fusion of business and government.  All anti-corruption processes serve to distract from this crucial point.

– So, we won’t see a real fight with corruption, our economic model won’t change, economic decline can’t be stopped.  Last year, our population was distracted with a fight of “spiritual ties” with the “fifth column”, spy scandals, and the “Oboronservis” case [2012 corruption scandal in the Ministry of Defense of Russia and its subsidiary “Oboronservis”, which is responsible for support, procurement, and other functions – DU].  This year it was distracted by the Winter Olympics, Crimea, and Donbas.  What will the officials use next to compensate for economic failures?

– It’s obvious:  geopolitical projects.  Hitler did the same.  Putin’s Crimea speech is simply a copy of Hitler’s speech after the annexation of Sudetenland;  he simply plagiarized Hitler’s speech.  It has all the Nazi ideological theories:  “separated nation”, “unification of indigenous Russian lands”, “Russian world” – analogous of the Third Reich, “unique genetic code of the Russian people”, meaning national exceptionalism, superiority, “traitors of the nation” (one had “enemies of the people” in their political vocabulary before)… Commentators immediately picked up on it:  Russians are an Aryan race…  Either Putin has brilliant speechwriters, or they were simply too lazy to write an original speech, so they plagiarized Hitler’s speech.  In any case, we can see that Putin enjoys those theses;  he constantly repeats them.  Economic successes, which are absent, will be substituted for such imperial delusions and fantasies:  the experience of Nazi Germany shows that this approach requires additional replenishment.  “Novorossiya” followed Crimea in Putin’s speeches.  But “Novorossiya” isn’t doing well.  Hitler had 7 years after Sudetenland before 1945, but the processes today are developing at a much faster pace…

– What is your prediction for the development of the situation in Southeastern Ukraine? One can see that “patriots” are trying to drag Putin into a war;  however, Alexei Venediktov [a Russian journalist, editor-in-chief and host at the Echo of Moscow radio station, president of the Echo TV Russia – DU] in our recent interview stated that Putin is too cautious to start it.

– Recently, this same Venediktov, after being with Putin in Vienna, presented a very outspoken and objective analysis of the situation, based on his conversations if not with Putin, then with his closest entourage.  Putin has few good choices.  On one hand, to send troops and to start a direct war with Ukraine means to trigger heavy sectoral sanctions of our economy, which means it will collapse rapidly;  this will only hasten the agony of his regime.  On the other hand, he started such powerful propaganda campaign, and received so much emotional support (this is where this 86% approval rating comes from), that he can’t simply dump Donbas and Luhansk “provocateurs” or “heores” (whatever you call them), because he will immediately incur accusations of “national treason”, a new term in our history which he coined himself in his March Crimea annexation speech.  Moreover, he is already being branded as such – read “Sputnik and Pogrom” [a site that positions itself as an information resource of Russian nationalists – DU], where he is openly called a “national traitor”.

That’s why Putin is really hoping for a third option, which is described in detail by Venediktov:  dragging Ukraine into negotiations, somehow legitimizing the “Strelkovs” and “Babaevs” [terms for Russian insurgents in Eastern Ukraine derived from last names of the most notorious of them – DU], and creating a huge “Transdnisteria” in Southeastern Ukraine, a smouldering hotbed which will undermine Ukraine, depriving it of the opportunity to develop using the European model.  After all, how did it all start?  It started with Putin being scared to death by the success of the anti-criminal revolution in Ukraine, which toppled a clone of his authoritarian regime, and selected the European scenario.  By no means can he allow the same to happen in his country.  He was close to realizing this third scenario, but under the pressure from Maidan, Poroshenko opted for a military resolution of the Southeastern problem.  And now Putin is left with two very bad options:  either to dump the Southeast, or to actively defend it thereby triggering sanctions.

– What about Putin’s pet project – the reincarnation of the USSR in form of Eurasian Economic Union?  How do you envision its future?  Even Lukashenko and Nazarbayev [Alexander Lukashenko and Nursultan Nazarbayev, Presidents of Belarus and Kazakhstan respectively – DU] got scared of the Crimean and “New Russian” stories…

– Of course, because Putin is always expanding the “Russian world” term.  It included ethnic Russians in the beginning, and then he said that it’s ex-citizens of the USSR, and then he said that it’s ex-citizens of the Russian Empire.  Finally, in Vienna, he mentioned that “Russian world” includes people who feel culturally close to the “Russian world”.  Thus, if he swallows a part of Ukraine, Estonian Narva will be next.  And what exactly is Northern Kazakhstan if not the “Russian world”?  And what is all of Belarus?  That’s why Nazarbayev and Lukashenko, to put it mildly, are concerned and kicking against Putin:  right after Poroshenko signed the association agreement with the European Union, Putin tried to impose high tariffs on Ukrainian goods, as promised, but Nazarbayev and Lukashenko spoke out against it, not without reason.  This is an outrageous situation: first, Putin dragged them into the Customs Union, and now he can’t do it unilaterally.

– It turns out, it doesn’t matter what our “great and terrible” Vladimir Vladimirovich wants – he is alone in the outside world, is he not?

-“Post-Soviet-Union space domination” is not only a Putin’s obsession, but also of the rest of our political elite.  They can’t get it in their heads that they are despised.  Even Lukashenko has been scoffing at them for 15 years already.  They wanted him to enter the Russian Federation, and for all those 15 years he has been signing agreements.  He will never exchange his presidency for a regional secretary position.  They do not realize that they are not needed in the post-USSR space as “life coaches”.  Some, for example, Tajikistan and Kirgizia, explain in to them more politely, others, like Georgia earlier, Ukraine now, tell them directly.  But they are blinded, they are certain that all those states dream of becoming a part of their new empire, of the “Russian World”.

– Andrei Andreyevich, the other day we quoted Umberto Eco, who formulated the attributes of fascism – it fits our reality 90%.  The famous writer Alexandr Arkhangelsky sees a possibility of dictatorship and “oprichnina”[a period of Russian history between 1565 and 1572 during which Tsar Ivan the Terrible instituted a domestic policy of secret police, mass repressions, public executions, and confiscation of land from Russian aristocrats – DU] in Russia.  What do you think?  Does dictatorship await us, in the full meaning of this word?

– Well, it won’t be announced on the TV:  “Dictatorship starts tomorrow!”  Dictatorship creeps in.  Today’s situation is closer to dictatorship than it was in 2003 or 2006.  When they come for us, then we will know:  here comes dictatorship.  They have come for many already.

– On the other hand, there is this widespread argument that if we had fascism or dictatorship, we would be in the concentration camp already.  Also, there are some acquittals on the “Bolotnaya case” [Bolotnaya Square case is a criminal case by the Investigative Committee of the Russian Federation on the counts of alleged massive riot and alleged violence against police during the “March of the Millions” on May 6, 2012 while the protesters were marching down the Yakimanka street in Moscow to the Bolotnaya Square – DU].  It’s not so scary anymore, is it?

– First, the acquitted were random people, persecuting them will exceed any form of justice.  Secondly, the regime remains rational so far, it sets the level of repressions at what is required to maintain power.   The “Bolotnoye” movement was shut down the same way (however, not only were there repressions, but also the leaders of this movement were “systemic liberals”, who always aimed at cooperation with the authorities, and who said even in the Coordination committee of the opposition that we must not topple the government, we must influence it).  This means that this level of repression is enough.  When the economic and social situations become exacerbated, the level of repression will surely increase.   If a certain amount of people need to be jailed, they will be.

– Oleg Kashin, a journalist, expressed himself in a similar fashion:  “Any Russian citizen is alive only because of the good will of the authorities”.  In this case, what is the fate of the “system liberals” (or, “the sixth column”, as Alexander Dugin [a Russian political scientist, traditionalist, and one of the most popular ideologists of the Eurasian empire that would be the counterbalance to the “North Atlantic interests”;  known for his fascist views; has close ties to the Kremlin and Russian military – DU] calls them) in Putin’s surroundings?

– This was brilliantly described a year ago in a report prepared by the Center of Political Technologies (Igor Bunin, president) [a consulting company which deals with political and business PR, acts as an analytical center, and also researches corporate culture – DU] which was commissioned by the Committee of Civil Initiatives [a pro-democratic NGO – DU].  I cite this report in almost every one of my articles because the fate of “system liberals” is written by themselves in all frankness:  on one hand, many of them are discontent with Putin, and even hate him for the corporate raiding using the security services, the aggravation of relations with the West, for this and that, but on the other hand, they are living the good life, and they realize that Putin protects them from the “people’s wrath”, if you cite “vekhovtsy” [Russian philosophers who were against the October Revolution of 1917 in Russia – DU].  They stated in 1909: “We must bless the authorities, which with bayonets and jails protect us from the people’s wrath”.  Now, “system liberals”, afraid of Putin, are even more afraid to be left without Putin, alone with the people.  That’s why they are not protesting.

– However, we remember that eventually, “vekhovtsy” sailed away from the bolshevist Russia on a “philosopher’s steamboat”.  We remember how Stalin’s “system liberal” Bukharin met his end.  Doesn’t history teach us something?

– Well yes, it’s almost the same.  The “Bukharians” didn’t oppose Stalin;  quite the opposite, they fawned over him in every way, because they belonged to the communist nomenclature as well, which was infinitely far away from the people.  And, eventually, he did anything he wanted with them.  However, today’s “system liberals” are viler – they are billionaires and millionaires.  The second reason, which is described in the same report, is that the hope that in 2024 or in 2030 Putin will hand his power over to somebody from their circles.  Those are the reasons why they will never oppose Putin, and he understands it perfectly.  All this experience shows us that if the elites were divided, and some masses took it to the streets – not the majority, but the vocal and active minority – this would be enough to topple the regime.  But the elites are not divided completely – this ensures the stability of Putin’s regime.

– Well, if the economy collapses, and riots break out, do you think Putin will hesitate to eliminate his own “Bukharians”?

– If the need arises, he will do this without hesitation.  We’ve already discussed that he is not inherently sadistic; he is a very rational man.  If riots break out, and you need to hang another Chubais [a Russian politician and businessman who was responsible for privatization in Russia as an influential member of Boris Yeltsin’s administration in the early 1990s – DU] to keep the people happy, he will do that.

– I’ve come across several predictions for the Presidential elections in 2018.  Igor Bunin [founder of the Center of Political Technologies – DU] is convinced that Putin will run for office himself, and, of course, is going to win.  Stanislav Belkovsky [a Russian political analyst and communication specialist – DU] predicts that Putin will become the “father of the nation”, akin to Nazarbayev – “elbasy” [Kazakh for “president”- DU], like Deng Xiaoping, and the operational management of the country will be delegated to the new president.  Maybe, it will all be so bad that Putin will prefer to stay on the sidelines?

– Most certainly, he will not remain on the sidelines. Relinquishing power is suicide for Putin:  he’s seen what happened to Qaddafi and Mubarak, thus, he won’t do it willingly.  He won’t become a Deng Xiaoping either – he passed the point of no return in 2008 [when Dmitry Medvedev was elected President – DU]. He has countless options: ultimately, he can organize some new union with South Ossetia and the Luhansk People’s Republic.  Does it matter how it will be called and how his power will be framed?  In any event, we don’t have real elections.

-Andrei Andreevich, you wrote and discussed frequently that the Coordination Council [Russian Opposition Coordination Council, created in October 2012 by Russian protesters – DU] is dumping the opposition.  There is a feeling lingers that the opposition is gone.  What will happen to it next?

– A new opposition will come, with a different, tougher ideology – neonationalists, which were encouraged by Putin’s “Russian World” idea, which he will disappoint with his failure to deliver.

– That is to say, your “colleagues” in the Coordination Council, having dumped the liberal opposition, and have created the conditions for another, more aggressive movement in the future?

– Of course, because the idea of the liberal opposition was discredited from the point of view of this mass.  Leftist ideas were discredited by 70 years of communist rule, and ideas are greatly limited: either liberal, or left, or nationalistic. Which slogans haven’t been defeated?  Nationalistic slogans.

– So, “the uprising of the masses”, “hand-to-hand combat” scenario is becoming more realistic?

– I don’t think so. Because of that, Putin will maneuver, he will try to use those slogans – both nationalistic and left wing, and he will find new enemies, new “traitors of the nation”.  You correctly noted that one way will be to throw many “system liberals” at the mercy of the people, as if they are responsible for the dilapidated state of the economy.  Plus some help from China and Donbas-generated, idolized “Chechen battalions”, which could be utilized to liquidate opposition leaders.

Second, the society is so atomized, poisoned and corrupted by alcoholism, drug addictions, and whatever, that I don’t see any “hand-to-hand” combat happening.  Resistance from below is channeled by certain social structures.  But everything has been “cleaned up”!  Even the potential leaders of resistance are also being “cleaned up”.  The propaganda campaign of our government, connected to sending troops to war, troops which have firsthand experience of warfare in Uganda or Honduras, and which are zombified by TV, is explained by the objective of identifying and eliminating the potential leaders of future riots during military action. We are in a continuous war since 1979 [The year when Afghanistan war started – DU].  Since then, many veterans and young people with distorted mentalities have been drawn to such “adventures”.   Remember Vysotsky [a Soviet singer-songwriter, poet, and actor whose career had an immense and enduring effect on Soviet and Russian culture – DU]:  “There are few who are tempestuous – thus there are no leaders”.  Now then, in order to remove them from the starting point of these riots, which should emerge in the future, along with the degradation of all socio-economic parameters, they are preventively eliminated in the “Vendée” of the Ukrainian Revolution [The War in the Vendée (1793 to 1796) was a Royalist rebellion and counterrevolution in the Vendée region of France during the French Revolution – DU].  Look – many volunteers are trying to return from there, but they are not let through, to the extent that they are exterminated by border guards.  I’m very sorry for those people – those are sincere, responsible people, convinced that they need to defend Russians, but deceived, set up by the insane propaganda.  They are ready to kill and be killed – those people are very dangerous to our authorities, and their physical elimination is one of the goals of the “cauldron” in Southeastern Ukraine.

All in all, we are in for an interesting ride.  But, I fear that it will end in dissolution of our state.

– I fear that too – the level of hate in our society is astounding.  What are the comments of our readers? “The country is reviving!  Only those who didn’t get power and money, those who were deprived of them complain!  You don’t like it – get out!”  Andrei Andreyevich, what would you advise us to do?

– In most cases, nothing can be advised, because those people are bots and trolls, who work for money or are such by calling.  Literally, one of those days there were many leaks and exposures of those organizations in Moscow.  I can hardly imagine a normal person who would write in such a manner.  Even an ideal society has problems, and a real patriot who comments on social issues, will do so in order to improve his country.  Development in principle suggests an honest discussion of the problems.  And we have so many pressing issues – healthcare, education, etc. that even the most loyal, but smart and decent person will discuss them.  This way, that rhetoric you mentioned immediately exposes a propagandist, who either receives a salary or is zombified to such extent that they can’t think critically.

It is alien for a sane person to be ecstatic:  how wonderful everything is!  There is no admiration of government in a healthy society.  I am familiar with Western mass media – they don’t have it.  Aggressive praise of the government is a sign of a totalitarian society, in which such activities are organized and praised, and of a totalitarian mentality.

– What would you recommend to the “creative class” – to leave (Andrei Loshak [a Russian journalist – DU] writes that the lines in front of the Israeli embassy are the same as in the USSR), to fight, or to accept the situation as it is?

– We have a perverted representation of the “creative class”.  In the West, “creative class” consists of scientists, engineers, innovative business people. Here, it consists of TV anchors and pornographic journal publishers; very little depends on them.  That’s why our “creative class”, which went to Bolotnaya Square, was so easily dumped by its own leaders.  Those people who represent something, for example, in science, don’t need any advice – they are already working for foreign companies and are feeling well there;  they have started receiving Nobel Prizes already.  If we take a broader audience of liberal-minded people – we are left with speaking the truth, this we will continue.  “We can’t predict how our word will ring”:  leaders may appear in the younger generations.

– A reader from the Kurgan region asks you which forms of opposition activities you think are most effective, are most in demand today, especially in “hinterlands”, in depressive, subsidized regions?

– The political field is cleaned up to the extent that targeted action toward the removal of the regime from power is impossible.  It won’t be removed as a result of elections, and it is ridiculous to participate in them anyway.  We can’t just take up arms and start an armed uprising.

Today, the regime is toppling itself.  Opportunities for ordinary political life will appear, after the regime mutates within itself, and we must be prepared for such a moment.  We need to create a network community, to find like-minded people – now the Internet allows us to do it;  to communicate with each other and think of ways to solve myriad political, economic, and social issues:  what will we do with the privatization issue, the North Caucasus issue, Siberia and Far East issue, and tens of other pressing issues.  We must find each other in the Internet and prepare for the moment when a political life will emerge, in which our opponents will be fans of “Sputnik and Pogrom”, who have different answers for those questions.

Interviewer:  Aleksandr Zarodozhny

Translation and comments [DU] by Dmytro Usenko, student at Rotman School of Management, University of Toronto

Edited by Myron Spolsky

Source:

Obozrevatel:  Пионтковский:  состояние Путина оценивается уже за сотню миллиардов долларов

Original article: «Состояние Путина оценивается уже за сотню миллиардов долларов. Это не коррупция…»

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