“The greatest state corruption since the Second World War and Western governments and banks are turning a blind eye to it.” Robert Amsterdam, lawyer for Mikail Khordakovsky. Khodorkovsky seems to have many people who will say what a good person he is, not just Robert Amsterdam who is in his pay of course, in fact if you hear his supporters speaking you’d be forgiven for wondering if this were not the second coming of the Messiah. This is unsurprising and hardly an objective state of affairs but of course he is very rich and powerful and consequently can afford to get people to do this for him. This is not new or rare, in the modern business world he would be very much the exception to the rule if he did not employ people to do this for him. Khordorkovsky has every angle covered, he has his parents to tell the media that he isn’t interested in material wealth and that he pays himself just enough to fund a modest family life. It does strike me as a little strange for a billionaire to claim that he’s not in it for the money. Is this a new movement of the caring and sharing oil baron, the antithesis of the Bush family? I’ll leave you to decide that one. Khordorkovsky has the very best lawyers on the case as well as a well-heeled PR machine, anyone with serious power does not give it up lightly and the Russian oligarchs are no exception.

If you chose to see things from a completely orthodox socialist/communist perspective you could respond by saying that these oligarchs in Russia are the same as so many magnates and moguls in the West and they themselves are in the situation they are in based on wholesale rape of resources and moral as well as usually physical corruption. Thus I could simply choose to say that’s the system as it stands, deal with it. But I like the sound of my own text too much for that!!! And besides perhaps I’m biased, though I would like to state here and now I am not some apologist of the Russian regime in some Svoiet-revisionist policy. I am however an anti-capitalist and I see many reasons for my stance as such, not least for the fact that capitalism doesn’t work in the long-term and it is delusional to think otherwise.

I do see something of a paradox in the Khordokovsky situation. Many companies are taken over in hostile fashion and this is seen as the system in operation in fact perhaps at its most latent and voracious. All bets are off though when the state intervenes for any reason, this is seen as interventionism or steps to renationalisation and stopping the system organically expanding the way it would if unfettered, despite that expansion generally resulting in the same circumstances with moderately different protagonists. Strange then that the same sort of rhetoric is not applied to hostile takeovers by private companies on each other, the big fish devouring all the smaller fish in the area. What people don’t seem to acknowledge is that if the state is responsible for the people within it then it has a duty to ensure that things are done as best possible for those in its care and if this includes interventionist policy then to my mind so be it, would one rather something functioning for the few or the many? Personally I do not agree with State Capitalism and I question whether many states do genuinely have the best interests of their citizens at heart but this is a totally seperate issue, one could debate the nature of Hegelian benevolent state and whether or not it can or will exist until one is blue in the face.

I find it a little rich to hear Robert Amsterdam talking about how when governments feel themselves above the law everyone should worry, when in the private sector companies have felt themselves above the law for many decades, especially when it comes to oil companies. Perhaps had they been a little less latent and exploitative they would not have left themselves open to such reciprocal behavour. Ethical capitalism, bollocks, no such thing, you cannot put reins on a system like this because the free marketeers will claim this is a ‘restriction on the free movement of capital and goods’ and all that shite. These are of course the same free marketeers who ensure that their products are subject to tariff protections so as not to face competition from cheaper, often better and usually more ethically produced 3rd world imports. Look into how protectionist that great land of the free America is, start with the steel industry and work back.

Khodorkovsky cites the retired employees of Yukos, who will suffer from the state’s takeover of the company, that he says have been treated unfairly. This is a slightly new tack on a hackneyed type of defence, after all how many times have we seen such workers shafted by the same industrialists without the cries of foul. I don’t think the Daily Mirror employees would be particularly inclined to agree with the notion that big company bosses have set a precedent of compassionate capitalism. Look closer into the company Yukos and its directors, many of them American – these are people with large amounts of money like CEO Stephen Theede and such people generally possess a strong desire to protect their interests. It is for this reason that they have sought to embroil the US court in the dispute and thus sour US and Russian relations. Interestingly one of the opposers to their case in the US was Deutsche Bank not reknowned for its social democratic stance. Yukos parent company, Group Menatep, has sued Russia in Europe for $28.3 billion in financial damages, and the company is also seeking $20 billion in a separate U.S. lawsuit against Rosneft Oil Company and Gazprom for their role in the sale of Yuganskneftegaz, the company’s key production asset. This does not sound to me like the action of a company or individuals primarily concerned with the welfare of former employees, after all these directors retain their large fortunes and there appears to be no sign of them magnanimously giving any of that personal wealth up for the common good. The misappropriation of a genuine concern to appear better in the PR stakes is just another tool that magnates wield in the pursuit of their aims, one should treat it with the suspicion and contempt that such a callous approach deserves.

I do not agree with Spetznatz raiding orphanages like the one funded by Khodorkoshky, however whilst it is no justification for such actions it is well known that in order to hide money many capitalists will go to almost any lengths, particularly in terms of money laudering in seemingly benign projects to protect it from the state and their agents, the taxman. I would be very cautious in assuming that just because the subject in question is an orphanage that the reasons for the purchase are completely altruistic. Let us not forget that Khordorkovsky put his parents in charge of the orphanage in question and thereby killed multiple birds with one stone, he sank money into a project that should be safer from state intervention than his personal or corporate bank account, whilst at the same time safeguarding a pension for his parents. In my experience billionaires whatever their country or method of riches do not get or maintain where they are by being romantic idealists. After all Roman Abramovitch has been especially shrewd in his investment pumping his money into one of the most high-profile offshore transactions possible. I am not aware of him having been a die-hard Chelsea fan previous to his investment. In fact he invested in CSKA Moscow first before deiciding to go more for pan-global domination. This is a clever business deal because should Putin or the Russian state choose to pursue Abramovitch it is one thing to freeze Russian assets, after all he might have thought that since Putin thinks nothing of moving the Spetznaz into an orphanage Abramovitch’s CSKA Moscow investment may have been in the balance, naturally it would be quite another thing to order that players at Chelsea football club are sold to pay back money removed from the population of Siberian provinces. Any hint of such a move from Russia would be sufficiently unpopular, not to mention a complete crossing of legal jurisdiction, to render it highly unpalatable in the extreme to the British jurisdiction

In the midst of all this one must not forget that oil is a natural resource, perhaps the Russian govt has a reason for wanting control, the re-appropriation of the countries assets for public ownership and the good of the population, ok that may be a little far-fetched but perhaps it is to ensure that the Russian economy is balanced rather than the books of wealthy trans-national private corporations.

Companies have for many years done whatever they could to push the boundaries, people whether, workers, customers or bystanders have been treated appalingly, now the state is accused of being the gangster. It astonishes me that the richer the investor the greater the self-righteous indignation when something goes wrong. These people are not keen on the system biting back and they think they are immune on account of the wealth they have ammassed. One does not hear the same outcry when middle class individuals lose their money on the stock market, or when small companies go bust or when national economies are brought to their knees by currency speculators, so why is it that a select few people should feel that the value of their investments should always go up instead of down?

Attempts by the Khodorkovsky PR machine to portray that he is being poisoned, his fingernails taken to Prof Henry, world-renowned toxicologist at St. Marys hospital London, no evidence found of any poisoning.

After Khordorkovsky’s trial verdict Sen Tom Lantos and colleagues issued statement saying they would propose motion to have Russia removed from G8 – interesting coming from group of Americans who think nothing of the defying countless UN resolutions or free-trade agreements.

Why has the US government not intervened more publicly, well my hypothesis is that as usual they are acting in the interests solely of the US businesses they represent. With the increasing dependence on the Russian oil and gas reserves to safeguard the US’s long-term supply and need to provide an alternative to Venezuela since attempts to remove Hugo Chavez have proven ineffectual, the US government finds itself in something of a quandry. Many of its business friends are obviously lobbying for Khordorkovsky’s release, many of the US businesses have investments to lose if Russia decides to go all “commie” again. Leaving aside the morals of the wholesale rape of Eastern European resources by greedy Western Trans-Nationals, the US government must consider who it would rather deal with. As a trading partner and member of the G8 the Russian government has considerable influence but it’s post-Soviet infrastructure meltdown also requires continued US investment, the US can still exact pressure on Russia should it need to do so and energy provision is the one area where the US will exert whatever pressure it deems necessary. A private individual or business has less of an allegiance to any world affairs and is more interested in hard currency. Therefore it is perfectly plausible that Yukos could decide that the US is not the only market it wishes to satisfy, of course the US government would not stand for this unopposed but it would be more difficult for them to do anything about this without being accused of interventionism, something they would face criticism for from all sides as both the businessmen and Russian government would likely be against the involvement. Thus the current solution is ammenable to the US, the Russian government takes all the flack whilst the US can portray itself as incandessant and take the moral high ground without actually having to do anything.

“A strange thing has happened the government has become the biggest oligarch” editor of Novaya Gazzetta, himself a close associate of another disgraced oligarch Boris Berezovsky. The paper did not exercise the same critique of the oligarchs when they were at the height of their power, so if that’s the system is anyone surprised just that the government plays it better and uses the tricks at its disposal, after all the Russian Godfathers have very much shown it the way since the collapse of the Soviet Union, just as so many Western companies have in Eastern Europe, why is it more acceptable for a private individual to play such a strategy as opposed to a government?

Song Of The Day ~ Editors – The Diplomat

Original Comments:

John made this comment,
They can’t get at his money. It’s right here next to me on some computer in this tax haven, in a trust fund for his family. To think, if he bought a football club it’d all be okay again…
comment added :: 14th May 2006, 01:27 GMT+01 :: http://jangliss.livejournal.com