The biggest threat for Russia and for Putin

Putin's recent speech to the Federal Assembly contained two part: a foreign policy part which was nothing short of historical, and an internal economics part which was very disappointing to say the least.  In fact, I would say that it was outright frightening.  I won't post the full text here, but you can consult if for yourself by clicking here.  But here is my summary of Putin's message:

We will make every effort to aid the Russian business community, we will also make every effort to return much of the Russian money hidden abroad in offshore accounts, and we will create stability and predictability.  All this is fine and dandy, except for what was not said.

• Putin did not denounce the work of the Russian Central Bank or its Chairwoman.
• Putin did not promise to sell US bonds and bring Russian money back home.
• Putin did not sack a single Russian official for incompetence or, even less so, sabotage 
• Putin did not announce a major change in the status of the Ruble, no "golden Ruble" for example.
• Putin did not reject the western economic model.
• Putin announce no reform or taking over by the state of the Russian Central Bank.
• Most importantly, Putin did not announce any major change in economic policy

I have no way of knowing whether Putin sincerely believe in the western economic dogmas, of whether he has no other option than to pretend that he does, but the outcome is the same: Putin rejects the western political model while apparently still fully endorsing its economic model.

I have just listening to an interview of Mikhail Khazin and Evegnii Feodorov on the Russian New Service Radio and both of them are now openly sounding the alarm.  Khazin is demanding that the Director of the Russian Central Bank be fired and arrested, while Feodorov wants the Central Bank to be completely shut down.  I agree with both.

The Russian economy in general and the Ruble especially are both under direct attack, not only by official sanctions, but also by speculative operations.  The price of oil is collapsing probably under a combination of objective reasons (the world recession) and deliberate US operations, yet Putin is not changing economic course in a fundamental way and he is even complimenting the Central Bank for its activities.  Does that not remind you of something?

Personally, this reminds me of what happened during the last months of Anatolii Serdiukov when the Russian military was hit by one scandal after another, yet Putin continued to praise Serduikov and his work.  Eventually, of course, Serdiukov was sacked and replaced by the truly outstanding Shoigu,  but it took a lot of time and efforts to finally get him sacked (and even today Serdiukov has still not been sentenced by any court for his numerous criminal activities).

Does that mean that Putin is hesitant, weak or confused?

I don't think so.  I think that this shows that one of the most difficult and dangerous tasks for Putin is to get rid of the saboteurs in the top echelons of power.  The same Mikhail Khazin has recently declared that only now did the "Eurasian Sovereignist" group's power roughly match the one of the pro-US "Atlantic Integrationists" (though he did not quite use these expressions which are mine).

Hopefully Putin is setting up a Serdiukov-like sacking of Nabiulina, but this is not sure at all.  The pressure is mounting for him to take dramatic action and to finally begin to de-couple the Russian economy from the western economic orthodoxy known as the Washington Concensus, but there is also a lot of resistance.

This is right now by far the biggest threat to Russia and Putin: the 5th column of saboteurs in the top echelons of power, especially the government. As long as these people will remain in power Russia will continue to remain weak and fragile and very susceptible to western economic warfare.

The Saker

An example of the Russian 5th column at work

Over the recent days bad economic news have been pouring in for Russia: the prices of bread, cheese, medicine, meats and many other product have been going up, some of them sharply.  At the same time, the Ruble has reached a new low against the Dollar which forced the Russian Central Bank to intervene to defend the Ruble.

No doubt, Obama would say that the sanctions are showing their effectiveness.

Except for one problem: no economist has been able to directly link the US/EU sanctions with what we are observing.  In fact, the reality is much simpler.

In the case of commodity prices what is happening is much simple: Russian companies have seized the opportunity presented by these sanctions to sharply raise their prices and make an extra profit.  So far, so good.  That was predictable.  In fact, the Russian government and Putin himself had predicted that and they had warned that the state would be closely monitoring any such price increases and that legal action would be taken against any speculators.

This is where things become interesting.

The person in charge of this monitoring is Arkadii Dvorkovich, Deputy Prime Minister in Dmitry Medvedev's cabinet has dismissed it all saying that when he goes shopping for bread he does not notice any price increases.  So who is this Dvorkovich character anyway?

Arkadii Dvorkovich

Turns out that he is a pure product of the Atlantic Integrationist clan.  Himself a rather modest oligarch (his official personal income in 2011 was only 4 millon Rubles), he is married to a much bigger oligarch, Zumrud Khandadashevna Rustamova, who, according to the Russian Wikipedia, is a member of the board of directors of major companies like the Magnitogorsk Metallurgical Kombinat, the gold mining Polius Zoloto, or the main Moscow airport Sheremetevo.  Her official yearly income is already a healthier 42 million Rubles.  Dvorkovich, who attended Duke University in the USA, is also involved in all sort of more or less shady companies and deals including the infamous Skolkovo project.

In fact, I would argue that Dvorkovich is so typical of the Atlantic Integrationists that he could be their poster boy.  By sabotaging the Kremlin's efforts to prevent Russian businesses to profit from the sanctions, Dvorkovich not only stands to get some terrific kickbacks, but he also contributes to the 5th columns efforts into convincing the general public that western sanctions are crippling Russia.

The good news is  that the Eurasian Sovereignists are fighting back and that several Russian TV channels have already reported about these abnormal price increases and about the fact that Dvorkovich seems to be doing exactly nothing about it.  

Over and over again we observe the same phenomenon: the President order the Prime Minister and his government to do something, and the latter just ignore him.  This is a typical example of how the 5th column works in Russia and, in the future, I plan to provide more examples of this here.

The Saker

What Makes Strelkov Feel "Melancholy" - Military-Political Situation Report, July 20, 2014

Note: this article is dated July 20th because it took 2 days to translate it. I think that this is a *must read* for all those who wonder about the nature of the ugle behind-the-scenes infighting between various Russian groups about the future of Novorussia. A huge "thank you!!!" to all those who helped translate this most interesting text.

The Saker
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What Makes Strelkov Feel "Melancholy" - Military-Political Situation Report, July 20, 2014 

by Boris Rozhin aka "Colonel Cassad" 

Some genuinely do not understand why, for some time now, along with his usual military briefings, Strelkov has been making fairly pessimistic statements. In reality, the reasons here are fairly transparent.
 
The Change in the Russian Political Line

In May-June, when the political line that changed in April (the question of military intervention was taken off the agenda on April 24) progressively started to influence the operational-tactical situation on Donbass, the hostilities also gradually gained momentum, leading to a scenario in which an irregular militia was forced to fight against a regular army. At the stage when the seizure of power in Donetsk, Lugansk and Slavyansk occurred, this scenario was not initially planned for – everyone was betting on the recognition by the Russian Federation and the intervention by the Russian army.

After the commencement of hostilities and the change in the political line, the agenda became dominated by the question of tacit assistance. So you can understand it from Strelkov’s example, all he had during the three months of fighting in Slavyansk was 2-2.5 thousand men (wielding light arms and heavy machine guns, automatic grenade launchers, ATGMs (many of them non-functional), a few MANPADS, and so on), only 3 tanks, as well as an IS-3 monument taken off the pedestal, several BMPs and BMDs, 4 or 5 Nonas, and several 12.7mm and 23mm calibre antiaircraft guns. This is about the size of one column from the Voyentorg “military supplies store” that the Junta now records almost daily.

That is about all that Strelkov received sitting in Slavyansk for 3 months, and the meager size of this aid was apparent from the amount of equipment that was taken out of Slavyansk at the end and by the very modest trophies that the Junta was able to demonstrate [after taking Slavyansk] (1 BMD, a batch of inoperative ATGMs, a few automatic rifles, and several mortar shells). That is about all that kept Slavyansk, Kramatorsk, Nikolayevka, Semyonovka, Krasniy Liman, and other settlements from falling into the hands of the enemy, despite the manpower ratio of 1 to 3.5-4.5 in favour of the Ukrainian army. In other words, it must be understood that, from the standpoint of weaponry, aid was coming in, but in the amounts entirely insufficient to fight an enemy grouping totaling up to 10-12 thousand men, even without taking into account the tanks, the artillery and the air force.
 
Strelkov's Appeals for Assistance That is why, with the development of hostilities and the outpacing rate of the enemy’s concentration of its forces, Strelkov started openly to make complaints, the general sense of which could be boiled down to the message that the aid was insufficient. Nevertheless, the curators of Russian policies in Donbass (and this was, first and foremost, Surkov, who was given partial reigns of control over Russian policies in Donbass, while, at the same time, Volodin was pushed to the side) fairly calmly contemplated how the Junta slowly, but surely enveloped Slavyansk, closing the ring of the operational encirclement.

Equally as calmly, they contemplated the enclave in Soledar (which has been defended by the Junta spetsnaz forces – 150-200 men – since the beginning of March), where over 1 million units of light arms were kept, making their way into the hands of the Militia for money (the trade started approximately at the end of April – beginning of May, when the sides of the conflict were noted massively to be armed with old weaponry). In fact, Strelkov himself wrote in the spring that they were forced to buy weapons from the Junta officers.

Also, over the 3 months period, no intelligible assault was organized on the tank base in Artymovosk, despite the fact that even pessimistic estimates suggested that there were 20-25 battle-worthy tanks, without even taking account the possibility of repairing other more-or-less preserved units at the expense of the non-functional ones. Over the months, no one bothered to take the base, let alone create a group to de-blockade Slavyansk by conducting strikes against the columns of the Junta enveloping the city, which would have enabled the Militia to continue to retain Slavyansk, Kramatorsk and so forth.

Despite the fact that Slavyansk was being encircled and was, finally, encircled, no one in Donetsk moved a muscle to assist. Sheer heresy was started to be written about Strelkov’s briefings, to wit “if Strelkov is melancholic, success is not far behind,” even though, looking at his briefings now, they objectively reflected the worsening situation near Slavyansk. The reasons why Strelkov was ignored are fairly obvious – while he fought in Slavyansk, negotiations between Surkov’s people and Akhmetov’s people were being conducted through Donetsk. Moreover, in the city itself, a conspiracy to surrender the city to the Junta was developing. You can read about the political underpinnings of these processes here, where they are covered in greater details: Colonel Cassad LiveJournal.
 
Strelkov's Breakout from Slavyansk and Its Significance

On July 2nd, the battles for Nikolayevka commenced, leading to the loss of control over the last significant highway that enabled supplies to flow to Slavayansk. Strelkov grew more “melancholic,” as it became obvious that Slavyansk, along with him and the garrison, were written off, and that no one was going to come to their aid. On July 2nd-3rd, when street battles still persisted in the surrounded Nikolayevka, where Motorola’s unit continued their heroic resistance (even despite the betrayal of two field commanders who stripped the irflank of defences), a decision to break out of the encirclement was adopted in Slavyansk; it must be understood that this decision had both a military and a political component – Strelkov was warned from Moscow that a surrender of Donetsk was being prepared.

In the night of July 4th-5th, the Militia effected a successful breakout, sustaining only minimal casualties. In doing this, Strelkov thwarted the secret negotiations being conducted between Surkov’s people and the people of Akhmetov and Kolomoiskiy (through Kurginyan’s people). The gist of these negotiations was an attempt by near-Kremlin circles to coordinate with the Ukrainian oligarchs the question of a “large Transnistria,” to be fashioned out of the Lugansk and the Donetsk Republics, at the head of which would have been Oleg Tsaryov, with a part of the financing flows feeding the South-East being locked on him.

In these contacts were implicated the mayor of Donetsk, Lukjanchenko (who has since fled to Kiev), the speaker of the Novorossiya Parliament, Pushilin (since dismissed from his position of his own volition), DPR minister of State Security, Khodakovskiy (since dismissed from his position as a minister, with Batallion Vostok having been transformed into a brigade and operationally subordinated to Strelkov’s staff), and police general Pozhidayev (the local command of the Ministry of Internal Affairs was purged almost immediately after the arrival of Strelkov’s brigade in Donetsk). All these people were, in one way or another, connected to Akhmetov. Antjufeev was sent to cleanse the upper echelons of DPR, following which a series of dismissals took place.

The Secret Collusion is Thwarted and the Hostilities Explode

As soon as Strelkov’s retreat from Slavyansk scuttled the secret negotiations, hostilities across the entire front sharply activated – Ukrainian oligarchs, who were contact with Moscow, immediately became the targets of a mass media campaign. Following contacts between Kolomoiskiy’s deputy, Korban, and a person from Kurginyan’s circles, the campaign against Kolomoiskiy in the Ukrainian mass media took on wide-scale proportions, including even traditional SBU [Ukrainian Security Service] leaks, such as the discussion about the preparation of a harassment campaign against Lyashko, the goal of which was to turn the Nazi radicals against one of their sponsors.

At the same time, open declarations by Kolomoiskiy, Filatov and Korban that time had come to confiscate Akhmetov’s property were no longer finding support in the mass media. The Junta mass media en masse defended Akhmetov, who had already given up Mariupol to the Junta and was preparing the groundwork for Donetsk to be surrendered. After the negotiations were thwarted, the Junta completely ceased to have any scruples about destroying cities and the infrastructure (there was no longer any chance that they could be obtained without battle through a collusion with the curators of Kurginyan and co.), as control over Donbass could only be established in a military manner.

Immediately following this, almost right away, the Militia gained access to a fairly significant number of tanks, BMPs, artillery (D-30 howitzers and Govzdika self-propelled artillery systems), and MLRS. To make the point clear, in one week the Militia obtained more heavy armour and military equipment than over the entire preceding three months. This immediately led to operational successes – the “Southern Cauldron” was formed, and the Junta offensive that began on July 1st, became bogged down on all directions by July 13th-14th. It is quite obvious that if the aid that has been provided in July had come in May, in the same quantities, then the battles would have now been taking place somewhere in the vicinity of Izyum, rather than near Donetsk.
 
Insufficient Piecemeal Military Assistance

At the same time, even despite the ongoing material and technical assistance, which was provided, and continues to be provided, the Junta’s rates of accumulating manpower and military equipment are still higher (without even taking into account the material, technical and organizational assistance from the United States and from NATO). That is why, due to the overall numerical superiority in manpower and military equipment, the Junta regrouped and continued its offensive despite the defeat, attacking the weaker sections of the front (the Militia simply has insufficient manpower and military equipment to defend everything equally well).

For clarity – Strelkov broke through to Donetsk from Slavyansk with 1 tank, 3 Nonas and several BMDs/BMPs. To his aid came 4 tanks, 3 Gvozdika self-propelled artillery units and several BTRs/BMPs; somewhat earlier a few Grad MLRS turned up near Donetsk. All this equipment is spread over the wide front that stretches from Snezhnoye, through Donetsk, to Gorlovka, and, from there, to Mozogovoi’s zone of responsibility. Whatever Strelkov could spare for Mozgovoi, he has sent off to him. At this time, his military equipment is tied up in the battles for Marinovka (DPR) and the airport, while also ensuring the defence of Donetsk and Gorlovka. He just does not have sufficient forces for anything more.

In fact, his continuing pessimistic statements arise from an objective assessment of the real balance of forces at the front. Fantasies of the “a bullet is dumb, but a bayonet is true” and “so what if the enemy has a lot of tanks and aircraft, we will break them with our fighting spirit and prayers” kind naturally can have no effect on the difficult operational situation. And that is why Strelkov’s “melancholy” is essentially a way to convey through the public (where he enjoys widespread support) to the government that he needs more weaponry and military equipment. It is understood that requests like this are also passed on through closed channels – in a more objective and less emotional manner. But this is just one aspect of the problem.

The Political Dimensions of Strelkov's "Melancholy"

The second aspect of Strelkov “melancholic” statements is a political one. The failure of the defeatists’ faction in the conspiracy to surrender Donetsk did not at all lead to their elimination. It is not difficult to glean from the continuing informational campaign against Strelkov that his presence in Donetsk obviously inhibits the plans of the collusion with the oligarchs and the Junta with respect to the future of Novorossiya.

Strelkov wants to continue fighting and to advance on Kiev, but to do this he requires men and arms, which he receives in insufficient quantities. And because this idea enjoy widespread public support, it is not possible to conduct open negotiations about the future of the “larger Transnistria” with the Junta and the oligarchs. In essence, Strelkov is not allowing to die the idea of the “larger Novorossiya” – an idea which Surkov and co. already wrote off, for the most part, in the spring.

In other words, Strelkov is a political hindrance in the way of the attempts to effect a political exchange of Ukraine for DPR and LPR. And that is why he will continue to be blamed for all mortal sins (today, the provocateur Kurginyan, in Dorenko’s best style, gave birth to the idea that Strelkov allegedly wanted to shoot down Putin, and, if we follow his reasoning, ended up hitting the Boeing), so as to clear the scene for a future collusion with the Nazi Junta about the future of DPR and LPR.

At the same time, military aid to DPR will be apportioned so as to keep the resistance from collapsing entirely (the version of complete abandonment of DPR and LPR appears to the Kremlin to be too burdensome), while simultaneously trying to chop off the assistance channels organized by the public – resources of informational support for DPR and LPR are being blocked, accounts are being closed, including through collusion between Russian banks and SBU and its curators. Junta’s provocation with the Boeing has already been picked up by the Russian faction of defeatists, who are, in effect, playing into the hands of the Junta propaganda machine by floating suppositions that Strelkov and the Militia stand behind the downing of the aircraft.
 
The Attack on DPR - from Without and from Within

In other words, the attack on DPR is, essentially, two-fold – on the one hand, there is the United States, its satellites and the Junta, and, on the other hand, the Russian comprador-defeatists and their mass media servants, such as Kurginyan. The floating of the idea about Putin, whom Strelkov allegedly attempted to kill, is necessary to create the conditions for someone in the highest echelones to give the go-ahead for the cessation of support to Strelkov. In other words, the necessary picture is being painted for the highest leadership of the Russian Federation, equally as much as for the public.

The gist of the operation is the following: (1) discredit Strelkov in the mass media (start taking note of those who participate in this campaign – by considering this wave you will be able easily to determine which of the talking heads are tied to Surkov and those who are preparing the groundwork for collusion with the Nazi Junta – they are the ones who constitute the mass media infrastructure of the real fifth column, and not the liberal buffoons who are usually represented as such); and (2) prepare the groundwork for his replacement.

If to implement this plan it would require the surrender of Mozgovoi or a part of the territory around Donetsk, this possibility cannot be excluded because it was exactly in this manner that, very recently, they tried to prepare the groundwork for the “heroic death of Strelkov in Slavyangrad.” The “heroic death of Mozgovoi in Lisichansk” might become a very convenient opportunity to continue attacks on Strelkov, who, they would argue, was unable to support him – with all of his 4 tanks.

Their ideal option is to subordinate the military command of DPR to Surkov and Co., so as to preclude any independence, and then to start negotiations with the Junta. While Strelkov, and such field commander as Mozgovoi, are alive, these plans have plainly stalled, and the defeatists are forced to spend time and political capital on Strelkov’s elimination. For Strelkov, the attack is obvious, and that is why, same as he did before, he continues to communicate to the society and the government, through public means, the simple idea that it will be impossible to backstab him that easily (i.e. that he will not go gentle into that good night [Note: original – he will not go silently to be sacrificed]) and that to win this war real aid is required, therebu appealing to the “war faction”, which provides real (rather than token PR) deliveries of aid and which is interested in spreading the insurrection beyond the boundaries of Donbass.

The Fork in the Road Demands Decisive Action

Understandably, he is not a lone wolf and that there are structures in Moscow that support him – otherwise, he would long ago have been buried somewhere near Slavyansk. And the generalized essence of all this fuss in Moscow consists in the fact that the options proposed by Strelkov are simple and clear, and Strelkov formulates them pessimistically – either the war is conducted more actively on the territory of Ukraine, or a capitulation and the transfer of the hostilities onto the territory of the Russian Federation will follow. And over the backdrop of the “all is lost, all has been given up”-style hysterics, this evaluation indicates a realistic fork in the road, which has been obvious since May.

Strelkov does not say “all is lost” – he says that the trend is unfavourable. And the development of the situation continues to confirm his conclusions. The defeatists’ faction, which increased its influence following the decision in April not to intervene militarily, is still trying to occupy two diverging chairs of war and capitulation, in the hopes of achieving an agreement with the Nazi Junta (which Strelkov is preventing) and the Ukrainian oligarchs. They hope, in the end, to secure an outcome that can be represented over the backdrop of the declarations made in February-March 2014 as something other than a complete surrender.

In this scenario, Strelkov, whatever his own views may be, has long ago become a symbol for those who wish to continue the fight either for the entirety of Ukraine or at least for a part of it. Strelkov’s opponents, on the other hand, have long ago written off Ukraine and are now attempting to find a way to escape this situation, so as not to cause unrest in Russia proper, even if, over the long term, the surrender of Ukraine will have the most catastrophic consequences for Russia itself.

And while this confrontation continues, Strelkov will continue to feel “melancholic” and “sad” until the moment when the choice between the two obviously unpleasant decisions is made. Or until the moment of his death, when both unpleasant decisions will be realized at once.

source:  http://cassad.net/category/politic/232-o-chem-grustit-strelkov.html