Fighting for Russia against the New World Order.

Showing posts with label Jon Hellevig. Show all posts
Showing posts with label Jon Hellevig. Show all posts

Russia’s domestic import substitution program is showing impressive results


Amidst global economic slowdown, Russia’s industrial production shows stellar growth. After sanctions and rejection of Western imports, Russia’s domestic import substitution program is showing impressive results. Industrial production up 2.6% year-on-year for the first half year. And accelerating, up 3.3% in June from last year. In the same period, the subsector manufacturing (factory production) surged by a staggering 3.4%, which really shows Russia is going full steam ahead.


Meanwhile, no growth in the US over the year, with two last quarters negative.

Germany down by 4% over the year.

It sure looks Russia is winning this one.
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Jon Hellevig: Succumbing to US Bullying Made Ukraine Poorest Country in Europe

TEHRAN (Tasnim) – A Finnish political economist and author highlighted predicaments of nations that refused to adopt strategies of resistance against US unilateralism, saying Ukraine, for instance, became “the poorest” country in Europe after succumbing to Washington’s bullying.    


Succumbing to US Bullying Made Ukraine Poorest Country in Europe: Finnish Analyst
“Look at Ukraine; they succumbed to USA bullying and propaganda and now their country has become the poorest in Europe although it used to be the industrial powerhouse of the Soviet Union,” Jon Hellevig said in an interview with the Tasnim News Agency.

“And look at Germany, France, and the whole European Union. Subjugated to the USA, they are being ruined with a stagnant economy for more than a decade and deep social and cultural crises,” he added.

Jon Krister Hellevig is a Finnish lawyer and businessman who has worked in Russia since the early 1990s. Hellevig was a candidate in the European parliament election in 2014. He is the managing partner of the Moscow-based law company Hellevig, Klein & Usov. Hellevig has written several books, including Avenir Guide to Russian Taxes (2002, 2003, 2006 English and Russian editions); Avenir Guide to Labor Laws (2002, 2003, 2006 English and Russian editions). Expressions and Interpretations, a book on the philosophy of law and the development of Russian legal practices; Hellevig takes actively part in public discussion of current affairs and social structure contributing with articles and commentary in the media. He regularly lectures at international seminars on various topics.

Following is the full text of the interview:

Tasnim: International developments are full of examples of how regional and trans-regional countries have successfully adopted strategies of resistance against oppression and unilateralism that have borne good results. As you know, countries like Iran, Syria, Yemen, Venezuela, and Palestine have protected their national sovereignty against foreign threats and achieved many gains through this strategy. In contrast, some countries have adopted a strategy of appeasement or reconciliation when being hectored and bullied by world powers. Given the experiences of these resistance countries, what do you think about their approach and the concept of resistance?

Hellevig: Naturally, resistance is the only choice, come what comes. At the same time, the resistance strategy must be smart and strive to build bridges to other countries outside the enemy.
Tasnim: Do you think countries that currently toe the line of major powers like the US ought to emulate these experiences of resistance countries to protect their independence and stand against unilateralism?

Hellevig: Obviously they should. It’s a question of both the material and moral well-being of the people and their very existence in the long-term. Look at Ukraine; they succumbed to USA bullying and propaganda and now their country has become the poorest in Europe although it used to be the industrial powerhouse of the Soviet Union. And look at Germany, France, and the whole European Union. Subjugated to the USA, they are being ruined with a stagnant economy for more than a decade and deep social and cultural crises. The traditional way of life of those European countries is rapidly being destroyed with their social structures torn apart. In fact, the very existence of those nations is now at risk.

Tasnim: In an op-ed article written for Tasnim, the Secretary of Iran’s Supreme National Security Council, Ali Shamkhani, warned the European countries of the risks of inaction regarding the US administration’s unilateral policies, saying the current EU leaders will be held accountable for Europe’s future challenges. Shamkhani criticized Europe for becoming an unimportant and passive actor that accepts humiliation at the hands of the US and has to live with the destructive effects of Washington’s unilateralism that have affected several international treaties. What is your take on that? Isn’t it better for the EU to stand up to US bullying and unilateralism?

Hellevig: The European Union and its main constituent countries are not independent nations as they have been taken over by US-led globalists. Their armies belong to the US umbrella organization NATO, their intelligence services are CIA branches, their media is owned by the globalists, their capitalists are totally at the mercy of the US market and its bullying terms, etc. Given these circumstances, independent-minded politicians do not have a chance to come to power, not in the individual states nor the totally undemocratic European Union.

The problems are fortunately building up in the European Union and with President Trump’s erratic policies the relationship is becoming increasingly fraught. But things must get much worse before the European people will mature to free themselves from the globalist yoke. I am afraid, it will take an enormous financial and economic crisis to bring that about. But this crisis will come for sure, sooner or later. Paradoxically, an attack on Iran might be the final trigger for that. And this is what holds the Americans at bay from Iran, at least for the time being. On the other hand, the US economy is so bad with enormous asset bubbles in every field of the economy, stock markets, housing etc., massive budget and trade deficits and skyrocketing debt. Therefore, there might be some people in the USA who could possibly consider war and ensuing financial crisis as a means to extract the country from those problems, to let everything crash and start the global economy anew from ground zero.

Source: https://www.tasnimnews.com/en/news/2019/07/10/2050611/succumbing-to-us-bullying-made-ukraine-poorest-country-in-europe-finnish-analyst
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How stupid can RT get?

Jon Hellevig: How stupid can RT get? Can't that Margarita Simonyan get off her twitter account and attempt to lead her news organization? There is total chaos and no editorial line.

Now, RT is spreading this. They carry the below picture with this caption: "In what could only be described as a truly rare event, Russian President Vladimir Putin’s face was spotted in an Aberdeen Angus sizzle steak in the meat aisle of a local Aldi supermarket in Croydon, UK"

Does Simonyan think that is funny and appropriate? I would say it is on the same level as Georgian TV's profanity-laden remarks against Putin.

The more so, when the photo is apparently staged and the meat has been formed to look like what RT thinks Putin looks like.


Link to RT's nonsense: https://www.rt.com/uk/463710-putin-appears-steak-aldi-croydon/

 
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Jon Hellevig: Finnish state church engaged in propaganda to support the terrorists of Aleppo

By Jon Hellevig

I had today a stopover at a small provincial town in Northern Finland. They were having their annual fair. After having enjoyed a fantastic street stall portion of crispy fried vendace, I strolled around. I then spotted the official Finnish protestant state church (yep, no separation of state and church here) had their stall there, too. That prompted me to ask a question, I long had in mind.

I approached the representatives of the church and asked why the Finnish state church had engaged in a propaganda campaign to support the jihadist terrorists of Aleppo. From 12th to 24th of October 2016 the Finnish churches were every day ringing their church bells “in support of the victims of Aleppo bombings” by the Russian and Syrian forces. I asked those people whether they knew that it was all the other way around and that the Russians and Syrian government forces were liberating the people of Aleppo from the brutal rule of the US sponsored terrorists. – They did not know it.

“The church is engaged in various campaigns from time to time,” I was told. – That I know, I said, and added that the most recent campaign was that of being the official sponsor of the Helsinki Pride sodomite pervert parade. ‘The church wants to live with the times,” the young church official replied, and continued “that’s why the church went in there as a business partner of the pride march.” – BUSINESS PARTNER, I exclaimed. How can the church possibly be a business partner of anything. What kind of business is this church engaged in?!?


“The church changes with the times,” my interlocutor said as three fat women colleagues looked on. I was mighty surprised to hear that. I said, how can the church which supposedly bases its faith in God’s immutable words change. Are you then saying that the bible isn’t for real? And do you mean the church was lying 100 years ago, or 50 years ago, when it professed another opinion on sodomy? Or are you lying today? Which way do you want to have it, I inquired?



I continued that line of discussion and then eventually left with the note that I was happy that so many people are leaving that fake politicized church. Membership used to be some 90% of the population when I was young, and now it is down to 60% and sinking.


I am not against sex in any consensual form between willing adults performed in privacy, but I am against this NWO globalist campaign of public perversion aimed at breaking down the fabric of society by means of this devilish campaign.

This perversion and its sister gender hoax is right up there with the climate hoax as key means of the globalists to destroy family and national values in order to break down society and make people more malleable for one world government rule. Naturally, the population replacement program by means of mass migration serves the same cause.
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FRANCE’S TEMPERATURE RECORD FAKE NEWS HOAX EXPOSED


 By Jon Hellevig

A municipality in Southern France called Gallargues-le-Montueux yesterday SUPPOSEDLY broke the all-time temperature record in France (for all months). But it turns out – as I expected – that it is a total fake.

Gallargues-le-Montueux lies in the Occitaine administrative region of France, the southernmost part of the country. It is a village of 3,500 people. According to the official readings the village recorded a peak temperature of 45.7 degrees yesterday. In the same day Nimes a city of 150 thousand people 25 kilometers northeast recorded temperatures around 42. Same level was recorded in Montpellier, a city of 300 thousand, 40 kilometers southwest.

So far, a convincing story. Yes? But Marseille (850 thousand), one hundred kilometers southeast, only had around 30 degrees. Same for Barcelona, 350 kilometers south. And Nice, 250 kilometers East, also had only 30 degrees.


Considering that the little bit bigger radius gave those vastly cooler temperatures, the story sounds fishy. On what kind of active volcano is the area between Montpellier and Nimes to have such enormous heat when everything a bit further around is seasonally normal?

I was monitoring the situation in France, because I had been alerted about the mainstream media's hysterics about a coming record heatwave, which did not at all tally with the forecasts I could check in www.gismeteo.com. I have several posts on this topic on my wall for the past few days. Therefore, I was checking the news as they came in. The BBC announced yesterday (28 June) that France would have record temperatures. The news was adorned with an image with all France (and most of Western Europe) painted in red inferno hellfire and with 43 and 45 degrees splashed all over it. This was incomprehensible in view of what the real weather forecasts said. And in fact Paris had yesterday only 30-31 at peak.

Something had to explain the volcano heat effect in the Montpellier – Nimes area and its record breaking Gallargues-le-Montueux. My hunch was that it was quite hot there, let’s say about 35 degrees. When it is 35 degrees it is not an abnormal summer temperature, but for most people it will feel really, really hot. So, it will be quite easy to announce that it was in fact 40, or 42. Which they did for Montpellier and Nimes. Then you choose a small municipality like Gallargues-le-Montueux and go on and announce that they made the record. There are so few people there, and most are pensioners, who are suffering from the heat anyway, that it will be a piece of cake to say they made the record 45.7. Nobody will contest that as they felt so hot anyway. (And they will be pleased to get their village in to the annals of national history). It would have been different in Montpellier and Nimes with the hundred thousands of people. Very big chance that too many had been making their own measurements, so you would just press the real 35 up to 40 – 42, but stay clear from records. Not to speak about Paris. - And BTW, wouldn't it stand to reason, that the bigger cities would have a higher temperature than the small villages?

A friend of mine just sent me proof positive that this is how it happened. But it was worse yet. My friend sent me a video from realclimatescience.com who specializes in debunking the climate hoax.


In the video, Tony Heller made some shocking exposures about this particular hoax. Turns out that the measurements are recorded from a thermometer on top of a tile roof directly exposed to the sun. The video has photo proofs, which I copied in the images below. (The photos are not from the same day, but they show the location of the thermometer). Heller gives another photo (below) of a thermometer by a highway a couple of miles off, also directly exposed to the sun. I hope the reader understands that a thermometer directly exposed to the sun, does not show the temperature of the air, but the temperature of the heated thermometer. – I suppose the Montpellier and Nimes readings where obtained in the same way, and this through globalist secret services special operations. Operations which could not cover the bigger cities around: Barcelona, Marseille and Nice, which therefore were spared the supposed heatwave.

More, being close enough, you can additionally tweak the results, never mind the actual readings.

This was a special propaganda false flag operation, where the Western propaganda media, foremost the BBC, prepared the ground a couple of days in advance. Then they delivered the false heat record as explained above.


This is all done in order to prop up the general climate hoax, where climate change (formerly known as global warming) is blamed on human emissions of carbon dioxide released by burning fossil fuels.

And not surprisingly, Greta, the Swedish wunderkind of climate science, was there right on cue to announce on social media (that is, the PR team of the Greta trade mark) that this record had been made and that it is all cause of humans “burning fossil fuels.” Greta TM’s post also copied below.






Source: https://www.facebook.com/jonhellevig/posts/2118658861596828
 
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Putin says liberalism is finished


By Jon Hellevig

Putin tells liberalism is finished.

In an interview with the Financial Times, Putin told that “the liberal idea” had “outlived its purpose” and said that nationalism is growing instead as the public has turned against immigration, open borders and multiculturalism.

“This liberal idea presupposes that nothing needs to be done. That migrants can kill, plunder and rape with impunity because their rights as migrants have to be protected,” the president succinctly put it.

Putin chastised the European liberal governments for not having acted to reassure the citizens. Instead those governments had pursued a mindless multiculturalism embracing, among other things, [false] sexual diversity.

On a positive note the president told that the liberals cannot anymore “simply dictate anything to anyone just like they have been attempting to do over the recent decades.”


Source: https://www.ft.com/content/670039ec-98f3-11e9-9573-ee5cbb98ed36

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Kazakhstan ends bank bailouts, writes off people's debts instead

Jon Hellevig: "Instead of bailing out banks and oligarchs, Kazakhstan will write off loans of the poor. This has been announced by new Kazakh president Kassym-Jomart Tokayev. There’s an unexpected corner of the world from where sound and fair financial policies emanate!

Doing this President Tokayev is actually reviving an ancient traditions of cancelling debts when a new ruler took over going back to Hammurabi, the Sumerians and other Near Eastern rulers. Michael Hudson has written a book called “And Forgive their Debts” depicting this story from Babylonia and to other Bronze Age Near Eastern realms.

Hudson tells that this concept of starting from a clean slate was also at the center of the Old and New Testaments, in the form of the Jubilee Year. Jesus actually said: “Forgive them their debts,” but it was converted by the Church to mean something vague in the form of: “Forgive them their sins.” Actually meaning, just pay up, and we’ll deal with the debts at the final judgement once you kick the bucket.

Forgiving of debts was also in ancient Greece and Rome an important policy goal in the fight against the oligarchs. Should become again."







Kazakhstan President Kassym-Jomart Tokayev said the debt relief would cost less than $1bn [Pavel Golovkin/Pool/Reuters]
Kazakhstan President Kassym-Jomart Tokayev said the debt relief would cost less than $1bn [Pavel Golovkin/Pool/Reuters]

Kazakh President Kassym-Jomart Tokayev said he'll write off bad loans held by a sixth of the central Asian country's population, while signaling a sharp change in policy to end costly state bailouts of private banks.

The loan-forgiveness program is Tokayev's first major policy announcement since he was elected president on June 9 in a choreographed transfer of power that began when longtime leader Nursultan Nazarbayev stepped down as head of state in March. His victory was met with rare and widespread protests.

Bank bailouts are also a sensitive issue in Kazakhstan, which has been mired in a decade-long crisis in which the government has pumped at least $18 billion into lenders to keep the sector from collapsing under the weight of bad debts. The central bank is conducting a review of asset quality, prompting speculation that a new round of bailouts may be in the works.

"My attitude is that there should be no governmental bailouts" for lenders, Tokayev, 66, said in an interview Tuesday in the capital, Nur-Sultan. "My assessment of this issue as a president is that the government should not get involved any more, any longer, with its loans as far as private banks are concerned."

Debt relief

While the debt-relief initiative may help lenders, the total cost is likely to come in at "a bit less than $1 billion," according to Tokayev. More than 3 million Kazakhs in the energy-rich country of 18 million will get help to escape debts averaging 300,000 tenge ($790), he said. It is aimed at "people who find themselves in very difficult living circumstances," he said.

About 4,000 people were detained by police during a rare outburst of protests against what activists said was a lack of real choice in the recent vote, which Tokayev won easily with 71% support. Leader-for-life Nazarbayev, 78, handed the presidency to Tokayev in March, who called the early election "to remove any uncertainty." International observers criticized the conduct of the vote.
The new president's debt forgiveness program is similar to a controversial policy unveiled by Georgia's ruling party, which announced the write-off of loans for 600,000 people days before a hotly-contested presidential election won by its candidate in November. "We are not following the example of Georgia, this is a different case" focused on the poorest citizens, Tokayev said.

Nazarbayev berated ministers as "cowards" in January for failing to clean up the banking system, shortly before he dismissed the government and replaced the central bank governor. Yet the biggest bank rescues have involved people close to the former president's inner circle.

While Tokayev denied that political connections played a role in past bailouts, "the lesson has been accepted by us," he said. "We will take lessons from the past, from what has happened in the banking system, and I think that in a couple of years you'll have absolutely new questions."
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CIA instructs its puppet regime in Georgia to makes provocations against Russia


By Jon Hellevig

The CIA has called on its puppet regime in Georgia to make a serious provocation against Russia, with staged demonstrations and threats against Russians. An American woman who serves as the US puppet president of that country declared that "Russians are our enemies and occupiers." Protesters held up signs telling Russians to **ck off.

Then Putin told Russians would do just that, **ck off. There came a Russian law, that no flights between Russia and Georgia are allowed, meaning no tourists will travel. 

The rub here is that Russians are by far the biggest paying tourist group. They are the biggest group, but also the most affluent group. Armenians and Azeris from neighboring countries also cross the borders, but they hardly keep the economy going.

But the Russians do. 30% of the Georgian economy comes from tourism. And about at least one-fifth or some 6-7 percentage points of that stems from the aggressors (Russians). Russia is also the only country that buys their wine and mineral water. That could be another 2-3%. So, this CIA inspired provocation will cost about 10% of the already miniscule GDP of that country.

Georgia's GDP is about 16 billion USD nominally, and 40 billion on PPP. Tourism is 3 billion out of that (9 billion on PPP). So, quite a costly provocation. Good luck with that.

Georgia has been hostile to Russia aleady for 10 years. Now with the spark of this new round of hostility they say that they will get tourists from other countries if Russians won't come. But then why did they don't get any other tourists during the last 10 years of hostilities?

Did they even get a Trump tower?
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Is Russia's economy stronger than they say it is?

 
Jon Hellevig writes: I don't know why Russia does this. They reported Q1 GDP growth of 0.5%. But they said the GDP deflator was 8.5%. GDP deflator is the factor by which you diminish the nominal GDP growth. The idea is that it would show the "real growth" of output instead of price inflation. In this methodological theory you would only show as output increase quantitative and qualitative growth but not price growth. But the inflation in the same period was only 5%. So, Russia decreases the GDP growth by much more than the inflation. At the same time, the price of oil and gas has not increased from last year, and not that of other commodities either. 

So, where from do they find this 3.5% decrease above inflation? I would not exclude that there is a Serdyukov ploy playing out here. Referring to the time he was Minister of Defense and grabbing the headlines because of corruption, while at the same time under his term Russia made an incredible modernization of the army. The one that took over Crimea in a night, and Syria in two years. There's a theory that Russia wanted they Yanks to think that the Russian army is a quagmire and will stay so until the time is right.

Related: West Attacks Russia with Piketty’s Overblown Claims About ‘Oligarch’ Wealth

So, perhaps I am giving the game away, and the Russian economy is actually growing much more than they want us to know.

At the same time, the real-real GDP, the one measured in PPP grows exactly by the nominal minus inflation plus the "nominal real growth" plus/minus difference in currency exchange to the USD. That is 9 - 5.5 + 0.5 + 0=4%

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"Putinomics" - review by Jon Hellevig

I just finished reading a book called Putinomics by Chris Miller. He had earlier written a book on Gorbachev's failed perestroika, except he did not call it failed, rather it was an apology of that failure. Nevertheless there was a lot of interesting facts (which facts the author tried to tweak to fit his agenda). All in all, I was satisfied with the reading, it gave me just what I was looking for, cause I am very apt at separating facts from the narrative.

His second book "Putinomics" is just what the heading promised. "Putinomics" - what a nonsensical concept that has been clearly chosen to appease the author's publisher. He discusses Putin's economic policies throughout his rule. In the text itself Miller provides no information that could in anyway justify the comical title, as if Putin was engaged in some hullabaloo excentric policies. Instead he gives a fairly reasonable account of how Putin has driven the economy. However, the big picture is lacking, and at the end of the reading one is in no way the wiser from having read Western MSM propaganda on the topic for 10 years. What surprises is that the book is so badly structured and does not in anyway dig into the most important topics, like modernization, corruption etc. Miller tells there is a lot of corruption, but he does not provide any evidence, not even discussion on that, and worst of all there is no comparative analysis, which would show Russia is far behind his own United States what comes to graft.


The one good thing is the author's surprisingly candid account on the criminal machinations that led to Khodorkovsky's downfall and the happy jailing of him, which marked the end of oligarch rule of Russia.

On the other hand the book is replete with all the classic Russophobe tropes - no doubt the grants would not have been flowing in otherwise and the book would not have been published. In addition to all the trite Western repetitions of "corruption," an "ineffective state sector", "Putin's pals" etc, we also read that Sechin (CEO of Rosneft) an employed director for a state owned corporation is repeatedly referred to as an oligarch.

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West Attacks Russia with Piketty’s Overblown Claims About ‘Oligarch’ Wealth by Jon Hellevig

West Attacks Russia with Piketty’s Overblown Claims About ‘Oligarch’ Wealth

Blowing Thomas Piketty’s academic fraud, Awara’s new study debunks the myths about overreaching oligarch grip on the Russian economy and supposed extreme economic inequality in a global comparison

There is no love lost between the Russian people and the oligarchs. You just can’t erase from history the theft of the century when the 1990s oligarchs looted the country through sham privatizations staged by the liberal government. The press has done its best to imprint the memory of those years of robber capitalism on the Western public. It’s a scandalous memory all too easy to exploit and rehash for the purpose of vilifying Putin and “his cronies.” At the same time, everybody seems to have forgotten how the present ruling plutocrats of America made their capital a century earlier.

The United States has already slapped sanctions on influential Russian businessmen, which they refer to as oligarchs. They are supposedly punished for their proximity to the Russian president who is incriminated with imaginary charges of meddling in US elections, a nerve agent attack on a former Russian spy and his daughter in England, and other fabricated allegations. And echoing antisemitic racial slurs of Hitler’s Germany, now with the Russians as the villains, the UK parliament has launched a crusade against “dirty Russian money” of the Russian “super-rich kleptocrats.”


But, the real reasons to go after Russian “oligarchs” and the “super-rich” have nothing to do with a newfound sense of social justice or their supposed ties with the Russian president. (By the flawed logic of the accusers anybody who is rich in Russia must be connected with the president). This time around this image of malign Russian oligarchs is used by the West in a full-frontal attack on Russian capital and Russia’s industry as the United States is hysterically trying to find ways to contain the country. By attacking Russian business tycoons, in addition to the state corporations, the US strives to block out Russian industry from the West and the wider world.

New study demonstrates that talk about Russia’s economic inequality has been greatly exaggerated

Yet, the idea that the rich own a vastly disproportionate share of the Russian national wealth has been disproved in a recent study by the Moscow based https://www.awaragroup.com. The study takes aim at Thomas Piketty’s high-profile report about Russia’s economic inequality. The Awara report does not aim at deflecting from the problem of economic inequality in Russia as the authors merely want to put the problem in its right global proportion. Economic inequality is not any more “extreme” in Russia — as Piketty falsely claims — than in the major Western countries in general. In fact, the Awara study shows that it could be less.

The Awara report exposes the bias and reveals the multitude of methodological errors, distortions and misrepresentation of data, which have informed the Piketty report. After identifying the deficiencies, Awara adjusted the main findings to reflect the actual data. The corrected data shows that instead of owning more than 70% of the national wealth, the share of the top 10 percent of the population was 39% of private wealth and 32% of total national wealth.

Below charts demonstrates the differences in the Piketty study and the corrected data of Awara. Top chart from the Piketty report, bottom, Awara’s corrected findings.



Correspondingly, instead of earning 45–50% of national income as claimed by Piketty, the top 10% of Russians earned less than 30% of the income. The Piketty research team had said that their study expressly replaces the findings of earlier income inequality studies like that of the EBRD, which had allocated 30% of income to the Top 10% richest. After revealing the multitude of flaws in the Piketty study, Awara found it natural to return to those earlier findings. his also puts the wealth figures in perspective as it is obvious that the share of wealth must closely correlate with the share of income.

Western propaganda can’t decide if Russia is owned by oligarchs or by the state

A big contribution towards mitigating economic inequality is delivered by Russia’s substantial public property. But in his study Thomas Piketty has written off the value of Russia’s public wealth as if it did not play any role as an equality inducing factor. It is actually very strange when one set of Western propagandists claim that Russia’s state sector has totally taken over the economy comprising 70% of the total, and another (like Piketty) maintains that the super-rich owns 70% of Russia’s wealth. It seems to us that the propagandists better make up their mind.

The Awara study reports that experts conclude that the state sector makes up a much higher share of the Russian economy than it is the case in all Western countries. The estimates vary from 35% — 70%. The European Bank of Reconstruction and Development (EBRD) has estimated that the share of the public sector (state sector) of the total economy was 35% in 2009. Experts agree that the state sector share has grown since. The Russian competition authority, the Anti-Monopoly Committee, estimated in its annual report for 2015 that the state sector had grown to comprise 70% of the Russian economy.

Small business enterprise value exceeds that of the Russian billionaires

A remarkable finding in the Awara report is that the total value of small and medium businesses (including shadow business) at 35% of total business assets stands way higher than all of “oligarch” wealth, and even at the same level as the combined wealth of the top 10 percent (39%). (Hereby, it should be noted that there is overlap between the categories of small and medium business wealth and top 10 percent wealth).

The 35% share assigned to small and medium businesses (SMEs) is backed up by reference to a study done by the global consultancy EY together with the European Investment Bank, which assessed that SMEs cover 20–25% of Russia’s GDP, in addition to estimates of the size of the shadow economy. The Russia statistics authority (Rosstat) has the shadow economy at 10–14% whereas liberal economists assess it at 32%.

When everything else failed, Piketty conjured up Russian “offshore wealth”

When all the other methodological biases, misrepresentations and distortions failed to produce the screaming inequality — which the scholars undoubtedly had set out to prove — they resorted to adding, some supposed “offshore wealth” to the possessions of the top 10% of Russians. We have all heard about assets Russian “oligarchs” have abroad, like the Chelsea football club, villas and yachts, therefore this one would seem like a safe bet. When the figures don’t prove that the superrich in Russia are so much richer than the Western plutocracy, throw in their offshore wealth. What Piketty therefore did was to add offshore wealth to the tune of the equivalent of 75% of the GDP to the richest top 10%. And Voila! The Piketty figures show extreme inequality for Russia in comparison with other countries.

Not only is there no evidence on the amounts and distribution of such “offshore wealth,” but it also represents a major transgression of Piketty’s own method as such assets abroad have not been taken into consideration in the studies concerning any of the other countries that his research team has examined. After all, the Piketty studies are supposed to represent global comparisons of economic inequality — the comparison is the very point they make. Yet Piketty blatantly breaches his own method just to make Russia look bad. See, no such “offshore wealth” has been summed up to the wealth of the rich in any of the other countries studied.

Piketty’s colonial ideal model

Obviously, the offshore wealth (i.e. assets outside home country) of the capitalist classes of the major Western countries is vastly more (as a share of) than that of the Russian rich. Just think about the holdings of the Western transnational corporations around the world. But Piketty et co. don’t even want to consider the Western transnational capital, going so far as to totally exclude foreign owners as factors of inequality in a given country. In their colonial model foreign owners are a benign class, above criticism. With this kind of logic, Piketty runs into total absurdities. Praising the relative inequality of Eastern European countries, he puts the success down to their colonial economic model, as the Pikettys express it: “the fact the holders of top capital incomes tend to be foreigners rather than domestic residents contributes to lower top income shares in countries like the Czech Republic or Poland or Hungary (as compared to countries like Russia or Germany). I.e. foreign owned countries tend to have less domestic inequality (other things equal).”

So, in Piketty’s perverted logic it is good that foreign capitalists own everything, because that makes the natives more equal between themselves. But in case of Russia it is the other way around, because some nasty rich Russians own property in third countries, it makes Russia’s wealth distribution more inequal.

Why would you call the Russian rich “oligarchs” but those of the West “billionaires”?

Why does the media call the Russian rich “oligarchs” while their peers in the West are just “billionaires”? The reason is obvious, oligarch sounds nastier and therefore it must be reserved for the Russians. That’s what Piketty does, too, calling his report “From Soviets to Oligarchs,” thereby clearly flaunting his biases. This is precisely what drove him, to tarnish the Russian state by alleging it’s a country ruled by a vile oligarchy and Putin’s cronies.

The Awara study demonstrates that the true income and wealth figures on Russia — especially when considering Russia’s substantial state sector — does in no way qualify Russia as an oligarchy any more than any of the other major economic powers in the world. But even if that would not have been the case and Russia’s wealth distribution would be as Piketty mendaciously claims, then still there would be no reason to pick on Russia by calling it an oligarchy. An oligarchy is foremost a political concept signifying that real power in a given country rests with a small number of super-wealthy people termed oligarchs. But, the fact that a country would have a skewed division of wealth with a disproportionate share of billionaires would yet not mean that the country is an oligarchy in the true political meaning of the concept. And certainly, the Russia of today does not qualify as one. It has been widely acknowledged that since his ascendance to Russia’s presidency (2000) Vladimir Putin has effectively stripped the super-wealthy individuals from the political power they actually wielded in the 1990s. Throwing around that disparaging epithet, Piketty has completely omitted any analysis of the political aspect of supposed Russian oligarchy. This clearly demonstrates his ideologically bias to revile the Russian nation and to flag his politically motivated preconceived conclusions

Piketty relies on Forbes billionaire gossip

Apart from the trickery with “offshore wealth,” Piketty builds his case on “data” drawn from the Forbes’s billionaire gossip. Of course, the Forbes billionaire data is an interesting and entertaining source and certainly can serve to guide the reader in the direction of who are the billionaires of one or another country. However, it seems that the Forbes exercises considerable editorial discretion in its reporting exposing and exaggerating the wealth of some billionaires while choosing not to disclose that of certain other billionaires. In any case, it is not a scientific study. The methods of compiling the data are not explained and sufficient details of the composition of the alleged wealth is not disclosed. The validity of that data would then at best be dubious, even in a transparent study.

Lies, damned lies, and statistics

The Awara report is not only a criticism of the dubious studies of the Piketty team, but also more in general an attempt to reveal how scholars manipulate public opinion under the cover of statistical methods to advance their ideological or pecuniary objectives. In this regard, the Piketty studies excellently illustrate the old adage “Lies, damned lies, and statistics.” A perfect case of how authority combined with the persuasive power of numbers is employed to bolster false arguments.

Awara explains the glaring differences in its findings with gross methodological errors and skewed or even fabricated data in the Piketty study. When the transparent data sources failed to back up Piketty’s prejudices about Russia, he resorted to blatant distortions.

In general, the Piketty reports never demonstrate to what extent the scholars have relied on one or another set of source data, rather their method is like a recipe for a potpourri, throw in generous amounts of Forbes billionaire data, a bit of survey data, some homemade tax tabulations, and stir everything with a Pareto spatula. The scholars merely tell that they have relied on those sources to make the blend, but the share of emphasis on one or another set of source data is not given and the choices are not discussed. There are also no scientifically falsifiable computations, which would show how the various data sources would supposedly have been mathematically combined to yield the results that these scholars claim to be their science. This is in itself renders the Piketty reports invalid as academic science and relegates them merely to the level of personal opinions.

Their starting point is said to be earlier household income survey data, which then is “corrected,” as they claim, with income tax data on high-income individuals, supposedly drawn from the referenced fiscal data. But the fiscal data does not represent any “raw tabulations by income bracket” as the scholars wrongly maintain. Furthermore, that data source does not contain any data on “high-income-taxpayers income tax data,” as was further gratuitously claimed. The national accounts and wealth inequality data is then somehow applied to all that in order to — supposedly — “impute tax-exempt capital income.”

Obviously, there cannot possibly be any mathematical model that could achieve the feat of combining the multitude of those disparate and overstretching data sources. In reality, the Piketty scholars have by an artful manipulation of the sources picked and chosen what aspects of all that welter of data to refer to in order to verbally motivate their conclusions. All the references to statistical models serve only as smoke and mirrors designed to lend academic credibility to the resulting computations.
The Piketty study is a potpourri of sources without any falsifiable scientific method to combine them.

Propaganda for war

There is no doubt that the scandalous history of Russian “oligarch” wealth and contemporary urban legends about the malicious grip of oligarchs on Russia have initially informed the Piketty scholars in their quest to prove “extreme inequality” in Russia. More than that, I am inclined to see the Piketty report as one more installment in the Russia bashing propaganda in line with notorious propaganda hoaxes like Assad’s supposed chemical attacks, the Salisbury incidents, Russian Olympic doping scandal, invasion of the Ukraine etc. At the end of the day, the question is about propaganda for war, which we must expose.

The Piketty research team is financed by the European Union, needless to say.



Here is the link to the full Awara Study: The Case Against Thomas Piketty. Lies, Damned Lies, and Statistics.


Countries compared on wealth distrion, Awara corrected data
 
 
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