Thursday, May 26

...The Brothers Karamazov, The Death of Ivan Ilyitch, Doctor Zhivago, the charges against Khodorkovsky...

Note to the Reader: Also see the most recent Pundita essays on the Khodorkovsky verdict and sentencing: ...The Brothers Karamazov, The Death of Ivan Ilyitch, Doctor Zhivago, the charges against Khodorkovsky... (May 26) and Mikhail Khodorkovsky bemoans Russian Justice, Anne Williamson tries to map Hell (June 1).

Breaking News! The judges are almost halfway through reading the charges against Mikhail Khodorkovsky and Platon Lebedev! Monday the judges managed to zip through 150 pages of the charges. There is a rumor that the youngest judge has taken to wearing pancake makeup and sprinkling in sentences from The Idiot when it's her turn to read the charges.

Lebedev continues to work on his crossword puzzles, Khodorkovsky continues to scribble notes and complain about the travesty to justice. Aw pipe down, bubba; K you ain't.

Meanwhile, the Tory backbench has breathed a collective sigh of relief. The Western press hailed the opening of the Caspian oil pipeline as a great triumph and another blow against Russia. The Reuters story was typical of the spin given to the news:
Oil started to flow into a U.S.-backed pipeline on Wednesday which will carry Caspian oil to the West and loosen Russia's stranglehold on exports from the region. The pipeline, built by a multi-national consortium led by British-oil giant BP, will eventually pump more than 1 million barrels a day from Azerbaijan along a circuitous route through Georgia to the Mediterranean port of Ceyhan in Turkey.

The venture is helping to redraw the geopolitical map of the turbulent Caucasus, reducing the region's economic reliance on Moscow, and will also give emerging oil giant Kazakhstan an outlet to Western markets that bypasses Russia.
"Circuitous" and "turbulent" are considerable understatements. So what does it all mean? It means that the United States of America, not the United Kingdom, will be left holding the bag, when military intervention is needed in the countries through which the pipelines run. It means that the United States of America, not the United Kingdom, will bear the lion's share of the financial burden for bringing those countries out of the Middle Ages. It means that the United States Department of State needs to be shut down until an army of forensic accountants can get in there and piece together what in the hell the State Department has been up to since the Yeltsin era in Russia.

Meanwhile, the electricity failed in large parts of Moscow yesterday, exposing for all the world to see what everyone in Russia has long known, which is that the oligarchs pillaged Russia to such an extent that Russia's infrastructures are held together with duct tape and paper clips.

Meanwhile, Peter Lavelle at Untimely Thoughts reviews Vladimir Putin's smart plan to trim OPEC's sails. If Lavelle is right, it might be back to the drawing board.
Part of the Kremlin's damage control campaign as it assaulted Khodorkovsky and Yukos was to present foreign investors with an enticing investment alternative to Yukos. Yugansk was to be merged with the last remaining state-own oil company Rosneft and later that new entity would be added to the portfolio of natural gas giant Gazprom. Collectively, these three companies would be poised to not only to become the largest energy conglomerate in the world, but also able to compete with petroleum cartel OPEC. This new energy giant and Russia's new national champion would be open foreign investors. At present, foreign investment in Gazprom is limited and regulated by the state.

This was to be the happy end to an ugly story. The above scenario is unlikely to play-out anytime soon as the architects of the "Oligarch War" against Khodorkovsky and Yukos are fighting over the spoils and demanding their right to record victory in history.
I'm not sure the picture is quite that bleak. One would think that common sense would prevail but of course this is Russians we're talking about. And happy endings are un-Russian.

On the plus side--for those who would like to see the OPEC cartel broken up--there's no dearth of smarts in Russia. If the Kremlin plays it smart they have a clear shot at taking down OPEC. Surely the possibility is not lost on the House of Saud, so we can assume they are lobbying hard in London and Washington.

The formula is falling into place: the smarter the Kremlin's moves on the petroleum chessboard, the more we'll hear from the Get Putin Gang in the US and the more machinations we'll see from US and British-backed "democracy movements" in Russia. The machinations will give Moscow little choice but to move closer to Beijing.

It would be tacky to ask why the American portion of those machinations wouldn't be better channeled into a sound energy policy for the US. Study the Investech chart that Mover Mike publishes in his Oil Price in USDs and Employment essay to back up his contention that oil is cheaper in Europe than the US.

Is there a way to stop the madness? Yes. But not without first shutting down the US Department of State until an army of forensic accountants can get in there and piece together what the hell the State Department has been up to since the Yeltsin era in Russia.

There is a clear choice forming for the Republicans: get control of the State Department or Eliot Spitzer will be President of the United States and maybe as soon as 2008. The American people won't really looking for a president by that time if things continue on; they'll be looking for a prosecuting attorney who knows how to deal with mobsters and white collar criminals.

However, there are strict limits on how much blame can be shifted to State--or the British government or any oil consortium or the Saudis--or any American transnational corporation, for that matter. The bottom line is that you cannot expect a policy of rational self-interest for a country as a whole, if you place what is essentially a transnational corporate lobbying mechanism into a foreign office--then keep the whole shebang closed to congressional scrutiny. So the ball bounces into the court of the American voter.

For those readers who are having a hard time following, I refer you to two essays I published about the Office for Commercial and Business Affairs (CBA) at State: The America Desk and More on the America Desk . I advise that you read those essays as if your life depended on it.

Please don't write to tell me that surely, since 9/11, it's no longer official that business concerns drive US foreign policy because that would be suicidal. The CBA needs to be entirely removed from the State Department, and State's intelligence agency needs to be shut down or rather transferred to the CIA.

Do not expect the White House or even the Congress to make such recommendations without the American voter setting up a howl. Without that howl, State can and will destroy the career of any elected official--up to and including the US president--any Pentagon general, and any whisteblower who tries to take on The Forbidden City.

Go ask Bill Clinton, if you don't believe me--or ask the US general who was ordered not to provide adequate protection to the U.S.S. Cole at port in Yemen so as not to offend the Yemen government. Or ask John P. O'Neill--oh wait I forgot; you can't ask him, he's dead--murdered on 9/11 along with thousands of other Americans.


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