Thursday, October 9, 2014

Russian-speaking Ukrainians Support Kyiv
We’ve made this claim numerous times though it wasn’t based on scientific evidence but rather on listening to webstreams of the Euromaidan revolution and the Russian-declared war against Ukraine.
In the first example, numerous active participants and leaders of the Euromaidan protests and later revolution spoke Russian. They were interviewed by a variety of news outlets and their observations in favor of Ukraine and against Yanukovych, Putin and Russia were emotionally expressed in Russian occasionally with local expletives because they were Russian-speaking Ukrainian patriots.
During this recent historic moment in Ukrainian history, more than 100 men and women were killed by Yanukovych’s henchmen and it safe to say that a majority of those slain were Russian speaking Ukrainians. One video showed a distraught mother cursing in Russian against Yanukovych and his junta for killing her son.
Then, after Russia invaded Crimea, Luhansk and Donetsk, Russian-speaking Ukrainian soldiers and civilians were heard in webstreams explaining why they are supporting Ukraine and why they must defend their Ukrainian motherland. We recall Col. Yuriy Mamchur, considered the hero of Crimea, lead his troops in the Russian language while his soldiers sang the Ukrainian national anthem in broken Ukrainian as they charged the Russian lines. And then there were the Ukrainian cadets who spoke Russian but sang the Ukrainian national anthem in Ukrainian as they were forcibly evicted from their academy.
This were anecdotal observations but they were enough to challenge Putin’s claim that his invasion of Ukraine was intended to defend Russian speakers in eastern Ukraine. Of course, he lied again. His only intention was and is to invade, conquer and re-subjugate Ukraine.
However, these sketchy facts that served as the basis for strong convictions have been substantiated by a Harvard University study that shows that Russian-speaking Ukrainians support Kyiv. Furthermore, the study suggests that Russian-speaking Ukrainians may be significantly more supportive of Kyiv’s standoff against Moscow and the pro-Russian separatists.
The study, written by researcher Bruce Etling at Harvard’s Berkman Center for Internet and Society, is one of the first serious explorations of Russian, Ukrainian and English language social media content regarding the turmoil in Ukraine in the course of the past 11 months.
“Our general reading of newspapers and traditional media about the protests was that Russian speakers tended to disapprove [of the protests] and Ukrainian and English speakers tended to approve, and that would then just bleed into social media,” Etling said. “We wanted to see if that was what really happened.”
Actually, the opposite was true. Etling remarked that what was surprising, “very surprising,” was the portion of Russian-language content coming specifically from within Ukraine that was backing the Euromaidan protests.
“In Ukraine, among Russian-speakers, 74% were supportive of the protests, and only a quarter were opposed,” he said.
Additionally, the study revealed even among Russian-language content within Russia, support was nearly equal with opposition, at least at the beginning.
“That was really unexpected. It was so surprising that it was so overwhelmingly positive,” said Etling.
The study, called “Russia, Ukraine, and the West: Social Media Sentiment in the Euromaidan Protests” and published on September 25, noted, “This exploratory research shows that there was more support online in Russia for the Ukraine protests than one might expect.”
Etling concluded in the study: “It is also interesting that Russian-language sources in Ukraine are so supportive of the protests. This may be explained by the fact that many Ukrainians use both Russian and Ukrainian, and that language may not divide the country as clearly as many press accounts (and Putin – TC) may have us believe. However, it is also possible that these early results point towards more support among Russian-speaking Ukrainians for the protests than the Russian government and mainstream media claimed.”
A Reuters story observed, pointing out Putin’s media control, that “While support for Kyiv generally remained stable among those in Ukraine, for Russians within Russia opposition to the protests grew over time, reflecting what some have seen as a hardening of positions on both sides of the border. That may be a result of nationalist feelings, but Etling said that may also be due to increasing media control and self-censorship there.
“I definitely think self-censorship in Russia is becoming increasingly problematic,” Etling said. “It’s becoming so difficult to express for someone who’s opposed to the Russian government’s view in Russia to talk about Ukraine war in a negative way.”

These heartening findings about the undeniable unity of the Ukrainian nation in Ukraine regardless of language preference also prove again that despite what Putin claims, sooner or later his lies are debunked.

Sunday, October 5, 2014

Falling Ruble May Turn Putin’s Dreams into Rubble
Can Russia’s catastrophic economic slide cause the perennial evil empire to implode?
The recent protests against Putin’s dictatorial regime and his war against Ukraine are encouraging developments in that autocracy. However, with less than 100,000 protesters out of a population of 144 million, it will take time before the Russian opposition reaches a numerical and passionate critical mass that will trigger a Maidan-like revolution that will rid the world of that scourge.
On the other hand, a hopeful alternative could be Russia’s powerful fraternity of billionaires.
Despite Putin’s boasts that US & EU sanctions against Russia for invading Ukraine, as “utterly foolish” as he calls them, are not hurting it and the country will ride out this storm of adversity, statistics show an opposite reality.
The following data was gleaned from a variety of news sources during that past two weeks:
  • Russia’s economy will fail to grow at all in 2014 and inflation will reach a four-year high.
  • Analysts predict that the Russian economy would contract by 0.3% in the fourth quarter of 2014 and recover only gradually over the next twelve months, with growth in annual terms rising to 0.2% in the first quarter of 2015, 0.5% in the second quarter and 1% in the third quarter.
  • Inflation would hit 7.9% by the end of 2015 – the highest end-of-year outcome since 2010 and well above last year’s 6.5%.
  • With access to Western financing blocked, Russian companies are being forced to cut back on investments to reduce their debts. At the same time, they are squeezed by high local interest rates as the central bank struggles to stabilize the sinking ruble.
  • Analysts expect inflation to rise further above 8% in the first half of next year, and fall only gradually to 7% by the end of the third quarter. Russian consumers are also enduring this as Western sanctions boost prices and restrict trade.
  • Stubbornly high inflation means that any interest rate cuts by the central bank – regarded as one way to boost the stagnant economy – will remain a long way off.
  • The ruble will be worth 37.5 against the dollar by the end of 2014, a whole ruble weaker than August’s forecast of 36.5, but stronger than the ruble’s present value of 39.50. The ruble recently tumbled to a 15-year low of 39.71 to the US dollar and lost 14% of its value in the last quarter alone.
  • Russia’s former finance minister, Aleksei L. Kudrin, said last month that $110 billion has left Russia in capital flight since the crisis in Ukraine erupted. Kudrin also warned that growth may be 1 percentage point lower in each of the next three years.
  • Russia’s stock market is down about 3% this year, in contrast to about 9% growth in stock markets globally, according to an index of world equities compiled by Morgan Stanley.
  • Russia’s economy is deeply dependent on oil and gas revenue, which accounts for about 50% of the budget and 60% of exports. While in the first half of 2014, the price of Brent oil was $101 a barrel, now it is almost $91. But oil prices have plunged lately, reaching their lowest level in two years and, according to most analysts, heading even lower, as American production surges. The ruble has weakened 18% in the past year as the price of oil—Russia’s main source of foreign currency—has slid. In 2015 Russia will need an oil price of about $105 a barrel to balance its budget (see chart). But crude is currently trading in the mid-$90s, down about 10% since May.
  • Studies by the Economic Expert Group, a Russian consultancy, show that a $1 drop in the oil price per barrel leads to a loss of $2.3 billion in budget revenue. Because oil and gas make up around half of government income, the Kremlin’s ability to buy itself social and political stability is at stake.
  • The chief economist of VTB, a state-owned bank, has estimated that the Western sanctions trimmed about 1% of growth from the gross domestic product, or about $20 billion.
  • The economy ministry said the country’s gross domestic product didn’t grow in August year-over-year and declined by 0.4% from July.
  • The World Bank has cut its forecast for Russian economic growth to 0.3% in 2015 and 0.4% in 2016, down over 1% point on previous projections. There was a shortfall of 3.6% of GDP in 2007 but now it is more like 10%.
  • Capital outflows from Russian assets soared to $74.6 billion in the first half of this year, compared with $61 billion in all of last year, central bank data show. As much as $90 billion to $120 billion may leave the country this year, Interfax cited Deputy Economy Minister Alexey Vedev as saying late last month.
  • Military spending will drain the coffers and will reach 4% of GDP in 2015, an increase of more than $80 billion from this year. Spending on defense will rise by 85% between 2012 and 2017.
  •  “The Russian tourism market is experiencing a profound systemic crisis triggered by political and economic factors,” the Russian Travel Industry Union spokeswoman Irina Tyurina said. “The year 2014 was much worse for the travel industry even than the crisis year 2009, in which outbound tourism dropped 15-20%.
  • And finally the oligarchs. Russia is home to 111 billionaires compared with 152 in China and 492 in the USA. According to an article in ChinaTopix, “In the latest Bloomberg Billionaires Index, the 19 richest Russians had already lost $14.5 billion since the start of the year. The data is significant when compared to the 64 richest Americans who had an increase of $56.5 billion.
  • “The richest man in Russia, Alisher Usmanov, lost $1.5 billion since the crisis began. He owns the metal conglomerate USM Holdings Ltd.”

Up until now, the oligarchs have stood obediently behind Putin, not expressing opposition to his undemocratic policies and his unjust war with Ukraine. Are they loyal enough to Putin to withstand this crisis? Mikhail Khodorkovsky is out of the country planning his next steps and a couple of Russian billionaires are feeling some political heat. But so far the group as a whole is solidly supporting Putin.
Captains of industry and business are not known for making decisions based on morality, justice or charity so those considerations are not likely to lead them to oppose their godfather. They are driven by the bottom line to make decisions. If their losses continue to mount to a painful level, the oligarchs may rise up against Putin faster than the liberal activists who have taken to the streets in recent weeks or the consumers who’ll be complaining about rising grocery prices.
That’s why the fully justified sanctions that the free world has imposed on Russia must be maintained until Russia withdraws from Ukraine, until Russia becomes a true democracy or until the oligarchs are financially squeezed to rid Russia and the world of Putin.