HOW A POT OF GOLD WAS MINED AT THE END OF THE ARCTIC RAINBOW

It takes times of despotism, when the best and brightest of a country’s elite are obliged to fawn, flatter, and commit crimes to make their fortunes, that a sensitive man discovers that virtues are usually only vices in disguise.

At any rate, that’s what La Rochefoucauld – ducal courtier, failed plotter, brilliant aphorist in the reign of Louis XIV, the Sun King – had to say at the head of the little book of maxims, which summarized everything he had learned in 17th century France.

In modern Russia, there has so far been no one of comparable quality, neither on the throne, nor plotting behind it. But could it be that an entrepreneurial schemer like Roman Abramovich, whose fawning has enabled him to accumulate great wealth, has turned Rochefoucauld’s maxim on its head? Are Abramovich’s vices – his avarice, ostentation, fanfaronade, rodomontade – actually new Russian virtues in disguise?

From the point of view of some in the Russian capital, Abramovich’s readiness to spend his fortune on foreign follies -football games, celebrity in the London tabloids, gold-plated taps in a gold-plated yacht – demonstrates the virtue of leaving Russia’s natural resource assets where he found them, and of not challenging President Vladimir Putin for either the legal right to sell them to foreign shareholders, or the political influence to decide their future. According to one version of the current Kremlin attitude towards Abramovich, he will be allowed to make a get-away with his ill-gotten gains, but only once. His return is barred – unless he were to bring the gains back, and reinvest them into Russia, without the inside trading favors that made the fortune in the first place. According to the same view, Abramovich and his advisors are dreaming, if they think they can vote their substantial stake in the Yukos-Sibneft conglomerate – following the federal prosecutor’s freeze of the Menatep Group’s 44%, this is now the largest unencumbered voting stake – to a private benefit not endorsed by the Kremlin. Frivolity, opportunism, vanity – if these are Abramovich’s personal vices, they have the contemporary virtue of being irrelevant to the future of the country, so long as he accepts that.

If he does not, then there are some questions Abramovich might be obliged to answer regarding his Russian business dealings. One relatively small one, worth no more than $35 million, may be the proverbial drop in the bucket. But then, as La Rochefoucauld also warned, “fortunate people seldom mend their ways, for when good luck crowns their misdeeds with success, they think it is because they are right.” It is just when a Russian oligarch thinks he is right that the federal prosecutor, on instructions from the Kremlin, may pounce on him with an indictment.

When Oleg Savchenko, erstwhile proprietor of the European Bearing Corporation of Moscow, and Deerfield Universal Incorporated of no certain address, recently sold his stake in a remote Chukotka gold-mining tract called Maiskoye, Abramovich apparently was convinced he had done the right thing. For what, or for whom exactly is the question Savchenko has been running from ever since, possibly until a prosecutor catches up with him.

Elected governor of Chukotka on December 24, 2000, Abramovich has been trying to attract investment into the region’s potential assets. Maiskoye was one of them. Located near the 70th parallel, south of the Arctic icepack port of Pevek, Soviet geologists had drilled almost as many holes in Maiskoye as there were people in the region. Digging underground tunnels at Maiskoye was the primary occupation of the area between 1972 and 1986. By that time, Maiskoye was judged to contain between 3 and 4 million ounces of potentially mineable gold. If brought to the surface, refined, and taken to market, that would have a current value today of up to $1.6 billion. But the Soviet state decided the costs of doing that, compared with other gold sources in Russia, was too high. After Soviet economics were replaced by Russian and western ones, many mining companies took a close look at Maiskoye – and came to a similar conclusion. Polyus, the goldminer owned by Norilsk Nickel, told Abramovich (in his gubernatorial capacity) hat it would be next to impossible to earn a profit margin of 20% at Maiskoye, unless the region offset the project’s costs with a number of long-lasting tax concessions. For a margin of less than 20%, foreign miners in the region were even more cautious.

And yet, according to an announcement of September 4, 2003, Abramovich (in his gubernatorial capacity) managed to persuade Ivan Kulakov, chief executive of Highland Gold, a London-listed junior mining company, to pay $34.9 million for the right to mine Maiskoye. The terms of the deal were simple, at least according to the company announcement. Highland Gold – buying through a Cyprus subsidiary called Stanmix Holding Limited – would pay the Maiskoye licence owner, Deerfield Universal (that’s Savchenko) $11.9 million now, and installments of $11.5 million annually over the next two years. On November 4, when Highland Gold announced it had finalized the deal and made the down payment, no other terms or conditions had been disclosed.

For a fellow in the business of ball-bearings, Savchenko appears to have been richly rewarded for his little Arctic trouble. Kuiakov, on the other hand, appears to have paid a great deal for something no one else had thought was worth buying at the price. If this wasn’t a case of snow blindness, then what flash of inspiration had the Governor of Chukotka managed to transmit to the buyer and seller, to bring off their transaction? Manage he certainly did, according to a spokesman for Millhouse Capital (UK) Limited, the holding of Abramovich’s private assets which operates from offices near London. According to Millhouse, two of its executives participated in the sale negotiations. So did Andrei Gorodilov, a deputy governor of Chukotka. Millhouse acknowledges that they all were, or had recently been, employees and business associates of Abramovich. Gorodilov had been a first vice-president of Siberian -Oil Company (Sibneft), Abramovich’s most valuable asset. Although Kuiakov was wearing a Highland Gold hat at the table, and spending Highland Gold’s money, he too had been employed by Abramovich, and had served for a time as a board director at Sibneft.

Savchenko was reported in a Moscow newspaper as saying he had provided his stake in Maiskoye to Millhouse, using a Russian term that can be interpreted in different ways – in trust, for management, as a lien, or for collateral to meet an obligation. According to Millhouse, Deerfield Universal, the company through which Savchenko held title to Maiskoye, and thus the legal seller of the hopeful El Dorado, “is not connected in any way whatsoever with Abramovich”. To the question of how to interpret Savchenko’s characterization of the role Millhouse played in the selling of Maiskoye, the Millhouse spokesman said he was “not exactly sure”.

How willing Highland Gold, and its principal shareholder, the South African goldminer Harmony Gold, were to be the buyer is also not exactly certain. Early in September, Highland Gold was in secret negotiations, described by a witness as frantic, to forestall the loss of its single source of cash, the Mnogovershinnoye goldmine in the Khabarovsk region, several thousand kilometers to the south of Maiskoye. Also, there was insufficient cash in the Highland Gold till to meet a combination of its Moscow bank debts, due for repayment in October and November, and the price it would have to pay at auction for mine equipment at Mnogovershinnoye, which the regional government had scheduled for public auction on September 16. Attempts at fresh bank borrowings at the time were not going well, according to the banks. Did Kulakov have $11.9 million for the first installment on Maiskoye when he was at the table with the sellers? And if he was uncertain he could afford to meet the price of the Khabarovsk auction, why was he ready to compound his financial risk two weeks earlier? What was his hurry? Why would Highland risk paying so much for a non-producing asset, when it was at risk of forfeiting its only source of income?

The Russian oligarchs attract gossip, which exaggerates their influence. The answers to the many questions surrounding the Maiskoye transaction were thus boiled down by investment bankers and mining analysts in Moscow to just one. Abramovich, so the envious wanted to believe, was behind the seller, just as he was behind the buyer. To ensure that the price suited his pocket, he also sat at the table through the Chukotka regional representative, and as the deal mediator, Millhouse.

How wrong the Millhouse spokesman has insisted – how unfair to Abramovich. As La Rochefoucauld observed, the world is full of pots jeering at kettles. Who better, then, to dispel the aspersions than Savchenko the seller? And where better to inquire than at the Moscow office of his European Bearing Corporation? Starting then on September 8, and continuing for nine weeks, Savchenko has been contacted, and questions relayed to him through his secretaries, assistants, and spokesmen. When had he acquired Deerfield Universal, and from what source? Why had he bought a gold prospect if he was in the bearings business? Had he ever done business with Abramovich or his group? What type of transfer of his Deerfield Universal shares had he made to Millhouse, and for what reason? Was he the final beneficiary of the $34.9 million sale of Maiskoye, or someone else?

Savchenko’s business trips out of Moscow have coincided with every attempt at making contact for the answers to these questions. And so, to determine just good the ball-bearings business has been over the past few months, a separate contact was made with his company, requesting a price list for bearings for export to a European destination. That is when Savchenko’s secretary responded: “unfortunately, we are a consulting company, and don’t do direct sales.”

If the title of his company is a misnomer, could it be that Oleg Savchenko are names for someone who doesn’t exist? Those who claimed to be his secretaries, assistants, and spokesmen were asked two fresh questions: How tall is Oleg Vladimirovich? Is running one of his sports? This time the response was: “All questions about the company can be answered by our press service manager, who is currently occupied at a meeting. Usually, we do not disclose personal information about our employees or administration.” Follow-up questioning failed to produce the name of the press spokesman.

Whether his name is as fleeting, or as fictive as Savchenko’s has proved to be unimportant, beside a set of admissions volunteered by Highland Gold’s investment relations executive, Christine Coignard. Speaking from her office in Germany on November 20, Coignard was asked what she knew about the seller of Maiskoye. “The official seller was Deerfield Universal,” she responded. “The person behind it was Abramovich. Abramovich was the beneficial owner and seller.” Asked what form the sale negotiations took, Coignard said they had taken place over “several months”. They were finalized, she said, in direct talks involving Abramovich, Highland Gold’s chairman Lord Peter Daresbury, and Ivan Kulakov, Highland Gold’s CEO. All three “were directly involved,” Coignard confirmed.

She added that, during the negotiations, Abramovich “had two roles, one as a seller, and one as the governor [of Chukotka]. He gave an undertaking regarding the [mining] license. He said he would help renegotiate the terms of the license to make it mineable.” According to Coignard, these were changes that required approval by the Chukotka administration. She said one of the changes Abramovich offered to make proposed to “remove production targets”. While these changes must be effected in written documentation, Coignard added there was another undertaking from Abramovich she was not sure had been put down in writing. This, she said, was that the Chukotka administration would build at state expense a road between the district town of Pevek and the Maiskoye site for all but the last 10 kilometres of the 180-kilometre distance. “So far as I know, this is not a written agreement,” Coignard said, “but it is an undertaking.”

It seems the gossips told the truth. In one of the most wretched of regions, in one of the weakest states of Europe, one would have to be unreasonably jealous to dispute the value that Abramovich’s actions in the matter of the Maiskoye goldmine have conferred on the region he was elected to govern. What but envy could dispute the reward of $34.9 million he persuaded Highland Gold to pay him for doing his public duty? As to the difference between jealousy and envy, why leave it to unlettered prosecutors to probe, when La Rochefoucauld has already explained the difference. Jealousy, the old duke said, “is in some measure just and reasonable, since it merely aims at keeping something that belongs to us, or we think belongs to us. Whereas envy is a frenzy that cannot bear anything that belongs to others.”

RUNNING FOR PRIME MINISTER OF RUSSIA

MOSCOW – When a man runs for the office of Russian prime minister, he must first learn to crawl.

Former prime minister Mikhail Kasyanov mistakenly imagined he was on a high horse, when in early October he received a delegation from United States oil company ExxonMobil and allowed his guests to announce publicly that the Russian government could find no obstacle to their acquisition of a strategic stake in YukosSibneft, Russia’s principal oil producer.

That put him on the wrong side of President Vladimir Putin at the very moment when Putin decided to make the fight of his career, arresting and jailing Mikhail Khodorkovsky, forcing chief of staff Alexander Voloshin into the cold, and deciding there will be no sales or share swaps of Russia’s strategic natural resources to foreign corporations.

If Kasyanov had any hope of retaining the prime minister’s portfolio after the parliamentary elections on December 7, or the presidential poll next March, he appeared to have lost it when, his eyes askance, he was obliged by Putin to listen to a blunt warning to the entire cabinet to stay out of the Yukos affair. Kasyanov’s exit became a certainty when on Halloween he publicly attacked the court-ordered freeze of the 44-percent bloc of Yukos shares that Khodorkovsky and his allies control.

By contrast, the three economic policy ministers in the cabinet, which Putin inherited from ex-President Boris Yeltsin in 1999, quickly understood that the ExxonMobil deal was impossible, and Khodorkovsky insupportable. German Gref, minister of economic development and trade, appeared by Putin’s side when the president met with a group of investment bankers.

Since the Yukos affair began, Gref and Victor Khristenko, the deputy prime minister in charge of the oil sector, have become timid advocates of a new tax, licensing and anti-trust regime for natural resources that should eliminate the oligarchs as the dominant force in the Russian economy. Timidity is the sound a man lacking confidence makes when he is on all-fours.

It has been Alexei Kudrin, the finance minister and deputy prime minister in charge of macro-economic policy, however, who has made the loudest virtue of that deportment. In defending the president from that posture, he has appealed for selection as Kasyanov’s successor, Russia’s new prime minister. A one-time protege of Anatoly Chubais, Kudrin learned early how to run and crawl at the same time. Responding to the exit of Voloshin from the Kremlin, he declared that “this marks the end of the Byzantine empire!” as if Kudrin’s humble service in Byzantium all these years has been nothing if not dutiful, selfless, and unflinching in his resistance to bad policy.

“Of course, we will close that tax avoidance loophole, pay wages, and reduce taxes,” proclaimed Kudrin, once he had been convinced by Putin himself that there was no reversing course in the clash with Khodorkovsky. “But it never ceases to amaze me why a far-from-impoverished oil company should crave those loopholes so vehemently.” Irony is usually not a quality favored in Russian prime ministers, as it doesn’t comport well with unswerving loyalty, and the ability to accommodate contradictions – two higher qualities for the job.

How will Kudrin’s new support for the restructuring of the Yukos shareholding, and for an end to tax privileges for oil companies, lead him to treat the tolling privilege in aluminum, which Kudrin conceded in favor of Oleg Deripaska and Victor Vexelberg; or the privatization of Alrosa, which Kudrin has been tempted to give away to the President of the Sakha republic; or the declassification of metals secrets which he awarded to lobbyists from Vladimir Potanin, enabling him to prepare to place his shares in Norilsk Nickel on the international market?

These are only a few of the policy contradictions over which Kudrin has presided at the Finance Ministry until now. But they are potentially serious vulnerabilities in his campaign to win Putin’s favor for the next prime minister, if they prove that Kudrin’s loyalty has been too easily swayed by either foreign economic interests in Russia, or the oligarchs. Sergei Stepashin, the current head of the Accounting Chamber and briefly one of Yeltsin’s prime ministers, is a contender who can lay claim to greater independence.

Stepashin even attempted to direct his auditors into the Finance Ministry itself, which Kudrin has preserved from any of the accountability or public sector reform he has urged everywhere else in the government bureaucracy. That ex-President Yeltsin should go to great lengths to publicly belittle Stepashin, and simultaneously promote Chubais – published in an interview with the newspaper that Khodorkovsky recently acquired – is a strong signal of what Yeltsin (and Chubais) fears may happen in the prime ministry soon.

“It is not that he had some shortcomings,” Yeltsin recently said of Stepashin. “He is a talented and well-educated person. It was just that he did not have all it takes to be prime minister and then become president.” What that meant in 1999 was clear – Stepashin was too great a risk to Yeltsin and the interests of his cronies. Now, and in the second Putin term, that may be just what Putin needs in order to run a government fully free of the Yeltsin group’s influence.

Another contender, Vladimir Litvinenko, is possibly the most influential of the Kremlin’s advisors on natural resource policy, and the most modest. As rector of the St Petersburg Mining Institute, and one of Russia’s leading academics on resource policy, he has been biding his time and nurturing the president’s understanding of how to manage Russia’s resource wealth.

If Litvinenko is chosen as prime minister, or as a super-minister for natural resources, this would be a signal that the cash flow methods and investment priorities of the oligarchs who will remain after Khodorkovsky’s case is over will not endure either.

Neither Stepashin nor Litvinenko is the sort of character who will crawl for public office. Whether they are running is up to Putin to decide. His decision may already have been taken.

PUTIN COULD TAKE A LESSON FROM NAPOLEON

MOSCOW – Napoleon Bonaparte was the greatest tactician in European history.

Russian President Vladimir Putin needs to understand how similar Russia’s situation, and his own, are to the circumstances facing France, and to Napoleon, when the country was encircled by hostile powers, led by the British; its treasury emptied by corruption and civil war; its army demoralized and unpaid; and its fractious rulers intent on plotting one another.

There will be time over the 18 months that remain before the Duma and presidential elections to see whether Putin can think enough like Napoleon to turn tactical initiative into durable power. But we must begin in November 1793, when Napoleon was a 24-year-old artillery captain, and the battle of Toulon was fought against the British to liberate French territory. That victory launched Napoleon’s meteoric career. It was also a demonstration of Napoleon’s ability to defy conventional thinking, and win. (more…)

AND THEN THERE WERE NONE

By John Helmer, Moscow
  @bears_with

Agatha Christie’s whodunit entitled And Then There Were None – the concluding words of the children’s counting rhyme — is reputed to be the world’s best-selling mystery story.    

There’s no mystery now about the war of Europe and North America against Russia; it is the continuation of Germany’s war of 1939-45 and the war aims of the General Staff in Washington since 1943. Defense Minister Sergei Shoigu (left) and President Vladimir Putin (right) both said it plainly enough this week.

There is also no mystery in the decision-making in Moscow of the President and the Defense Minister, the General Staff, and the others; it is the continuation of the Stavka of 1941-45.  

Just because there is no mystery about this, it doesn’t follow that it should be reported publicly, debated in the State Duma, speculated and advertised by bloggers, podcasters, and twitterers.  In war what should not be said cannot be said. When the war ends, then there will be none.  

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RUSSIANS RAISE THEIR GLASSES – THE TOAST IS TO BEATING THE BLOCKADE OF MOSCOW



By John Helmer, Moscow
  @bears_with

Alas and alack for the Berlin Blockade of 1948-49 (Berliner Luftbrücke): those were the days when the Germans waved their salutes against the unification of Germany demilitarised and denazified; and cheered instead for their alliance with the US and British armies to fight another seventy years of war in order to achieve what they and Adolf Hitler hadn’t managed, but which they now hope to achieve under  Olaf Scholtz — the defeat of the Russian Army and the destruction of Russia.

How little the Germans have changed.

But alas and alack — the Blockade now is the one they and the NATO armies aim to enforce against Russia. “We are drawing up a new National Security Strategy,” according to Foreign Minister Annalena Baerbock. “We are taking even the most severe scenarios seriously.”  By severe Baerbock means nuclear. The new German generation — she has also declared “now these grandparents, mothers, fathers and their children sit at the kitchen table and discuss rearmament.”  

So, for Russia to survive the continuation of this war, the Germans and their army must be fought and defeated again. That’s the toast of Russian people as they salute the intrepid flyers who are beating the Moscow Blockade.  

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THE INTERNATIONAL ATOMIC ENERGY AGENCY GOES TO WAR — GORILLA RADIO GOES NUCLEAR

By John Helmer, Moscow
  @bears_with

Last week the International Atomic Energy Agency’s (IAEA) board of governors voted to go to war with Russia by a vote of 26 member countries against 9.

China, Vietnam, India, Pakistan, Egypt, Senegal and South Africa voted against war with Russia.  

The IAEA Secretary-General Rafael Grossi (lead image, left) has refused to tell the press whether a simple majority of votes (18) or a super-majority of two-thirds (23) was required by the agency charter for the vote; he also wouldn’t say which countries voted for or against. The United Nations Secretary-General Antonio Guterres then covered up for what had happened by telling the press: “I believe that [IAEA’s] independence that exists and must be preserved is essential. The IAEA cannot be the instrument of parties against other parties.” The IAEA vote for war made a liar of Guterres.

In the IAEA’s 65-year history, Resolution Number 58, the war vote of September 15, 2022,  is the first time the agency has taken one side in a war between member countries when nuclear reactors have either been attacked or threatened with attack. It is also the first time the IAEA has attacked one of its member states, Russia, when its military were attempting to protect and secure a nuclear reactor from attack by another member state, the Ukraine, and its war allies, the US, NATO and the European Union states. The vote followed the first-ever IAEA inspection of a nuclear reactor while it was under active artillery fire and troop assault.

There is a first time for everything but this is the end of the IAEA. On to the scrap heap of good intentions and international treaties, the IAEA is following the Organisation for the Prohibition of Chemical Weapons (OPCW), and the UN Secretary-General himself.  Listen to this discussion of the past history when the IAEA responded quite differently following the Iranian and Israeli air-bombing attacks on the Iraqi nuclear reactor known as Osirak, and later, the attacks on Pakistan’s nuclear weapons sites.

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INTERNATIONAL ATOMIC ENERGY AGENCY TAKES UKRAINE SIDE IN WAR IN SEPTEMBER 15 VOTE, MAKING UN SECRETARY-GENERAL GUTERRES EITHER A LIAR OR A FOOL

By John Helmer, Moscow
  @bears_with

The International Atomic Energy Agency (IAEA) decided this week to take the side of Ukraine in the current war; blame Russia for the shelling of the Zaporozhye Nuclear Power Plant (ZNPP); and issue a demand for Russia to surrender the plant to the Kiev regime “to regain full control over all nuclear facilities within Ukraine’s internationally recognized borders, including the Zaporizhzhya Nuclear Power Plant.”      

This is the most dramatic shift by the United Nations (UN) nuclear power regulator in the 65-year history of the organisation based in Vienna.

The terms of the IAEA Resolution Number 58, which were proposed early this week by the Polish and Canadian governors on the agency board, were known in advance by UN Secretary-General Antonio Guterres when he spoke by telephone with President Vladimir Putin in the late afternoon of September 14, before the vote was taken. Guterres did not reveal what he already knew would be the IAEA action the next day.  

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THE RUSSIAN SITUATION COMEDY IS NO LYING MATTER – THE JOKE IS ON THE OFFICE OF FOREIGN ASSETS CONTROL

By John Helmer, Moscow
  @bears_with

Never mind that King Solomon said proverbially three thousand years ago, “a merry heart doeth good like a medicine.”  

With seven hundred wives and three hundred concubines, Solomon realized he was the inventor of the situation comedy. If not for the sitcom as his medicine, the bodily and psychological stress Old Solly had to endure in the bedroom would have killed him long before he made it to his death bed at eighty years of age,  after ruling his kingdom for forty of them.

After the British sitcom died in the 1990s, the subsequent stress has not only killed very large numbers of ordinary people. It has culminated today in a system of rule according to which a comic king in Buckingham Palace must now manage the first prime minister in Westminster  history to be her own joke.

Even the Norwegians, the unfunniest people in Europe, have acknowledged that the only way to attract the British as tourists, was to pay John Cleese of Monty Python and Fawlty Towers to make them laugh at Norway itself.   This has been a bigger success for the locals than for the visitors, boosting the fjord boatman’s life expectancy several years ahead of the British tourist’s.  

In fact, Norwegian scientists studying a sample of 54,000 of their countrymen have proved that spending the state budget on public health and social welfare will only work effectively if the population is laughing all the way to the grave. “The cognitive component of the sense of humour is positively associated with survival from mortality related to CVD [cardio-vascular disease] and infections in women and with infection-related mortality in men” – Norwegian doctors reported in 2016. Never mind the Viking English:  the Norwegian point is the same as Solomon’s that “a sense of humour is a health-protecting cognitive coping resource” – especially if you’ve got cancer.  

The Russians understand this better than the Norwegians or the British.  Laughter is an antidote to the war propaganda coming from abroad, as Lexus and Vovan have been demonstrating.   The Russian sitcom is also surviving in its classic form to match the best of the British sitcoms, all now dead – Fawlty Towers (d. 1975), Black Adder (d. 1989), You Rang M’Lord? (d. 1988), Jeeves and Wooster (d. 1990), Oh Dr Beeching! (d.1995), and Thin Blue Line (d. 1996).

The Russian situation comedies, alive and well on TV screens and internet streaming devices across the country, are also increasingly profitable business for their production and broadcast companies – not despite the war but because of it. This has transformed the Russian media industry’s calculation of profitability by removing US and European-made films and television series, as well as advertising revenues from Nestlé, PepsiCo, Mars, and Bayer. In their place powerful  Russian video-on-demand (VOD) streaming platform companies like Yandex (KinoPoisk), MTS (Kion),  Mail.ru (VK), and Ivi (Leonid Boguslavsky, ProfMedia, Baring Vostok)  are now intensifying the competition for audience with traditional television channels and film studios for domestic audiences.  The revenue base of the VOD platforms is less vulnerable to advertisers, more dependent on telecommunications subscriptions.

Russian script writers, cameramen, actors, designers, and directors are now in shorter supply than ever before, and earning more money.  “It’s the Russian New Wave,” claims Olga Filipuk, head of media content for Yandex, the powerful leader of the new film production platforms; its  controlling shareholder and chief executive were sanctioned last year.  

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RUSSIAN AVIATION INDUSTRY CORRECTS YELTSIN YAW – BOEING, AIRBUS DITCHED



By Olga Samofalova, translated and introduced by John Helmer, Moscow
  @bears_with

It was the American humourist Mark Twain who didn’t die in 1897 when it was reported that he had. Twain had thirteen more lively years to go.

The death of the Russian aerospace and aviation industry in the present war is proving to be an even greater exaggeration – and the life to come will be much longer. From the Russian point of view, the death which the sanctions have inflicted is that of the US, European and British offensive against the Soviet-era industry which President Boris Yeltsin (lead image, left) and his advisers encouraged from 1991.

Since 2014, when the sanctions war began, the question of what Moscow would do when the supply of original aircraft components was first threatened, then prohibited, has been answered. The answer began at the Federal Aviation Administration (FAA) in 1947 when the first  Supplemental Type Certificate (STC) or Parts Manufacturing Approval (PMA) was issued by Washington officials for aircraft parts or components meeting the airworthiness standards but manufactured by sources which were not the original suppliers.   

China has been quicker to implement this practice; Chinese state and commercial enterprises have been producing PMA components for Boeing and Airbus aircraft in the Chinese airline fleets for many years.  The Russian Transport Ministry has followed suit; in its certification process and airworthiness regulations it has used the abbreviation RMA, Cyrillic for PMA. This process has been accelerating as the sanctions war has escalated.

So has the Russian process of replacing foreign imports entirely.

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FOR WANT OF A NAIL THE KINGDOM WAS LOST – ENGLISH PATHOLOGIST GUY RUTTY FACES CHALLENGE TO THE RELIABILITY OF HIS NOVICHOK EVIDENCE



By John Helmer, Moscow
  @bears_with

The weakest link in the British government’s four-year long story of Russian Novichok assassination operations in the UK – prelude to the current war – is an English medical expert by the name of Guy Rutty (lead image, standing).

A government-appointed pathologist advising the Home Office, police, and county coroners, Rutty is the head of the East Midlands Forensic Pathology Unit in Leicester,  he is the author of a post-mortem report, dated November 29, 2018,  claiming that the only fatality in the history of the Novichok nerve agent (lead image, document), Dawn Sturgess, had died of Novichok poisoning on July 8, 2018. Rutty’s finding was added four months after initial post-mortem results and a coroner’s cremation certificate stopped short of confirming that Novichok had been the cause of her death.

Rutty’s Novichok finding was a state secret for more than two years. It was revealed publicly   by the second government coroner to investigate Sturgess’s death, Dame Heather Hallett, at a public hearing in London on March 30, 2021. In written evidence it was reported that “on 17th July 2018, Professor Guy Rutty MBE, a Home Office Registered Forensic Pathologist conducted an independent post-mortem examination. He was accompanied by Dr Phillip Lumb, also an independent Home Office Registered Forensic Pathologist. Professor Rutty’s Post-Mortem Report of 29th November 2018 records the cause of death as Ia Post cardiac arrest hypoxic brain injury and intracerebral haemorrhage; Ib Novichok toxicity.”  

Hallett, Rutty, Lumb, and others engaged by the government to work on the Novichok case have refused to answer questions about the post-mortem investigations which followed immediately after Sturgess’s death was reported at Salisbury District Hospital; and a cause of death report signed by the Wiltshire Country coroner David Ridley, when Sturgess’s body was released to her family for funeral and cremation on July 30, 2018.  

After another three years, Ridley was replaced as coroner in the case by Hallett in March 2021. Hallett was replaced by Lord Anthony Hughes (lead image, sitting) in March 2022.

The cause-of-death documents remain state secrets. “As you have no formal role in the inquest proceedings,” Hallett’s and Rutty’s spokesman Martin Smith said on May 17, 2021, “it would not be appropriate to provide you with the information that you have requested.” 

Since then official leaks have revealed that Rutty had been despatched by the Home Office in London to take charge of the Sturgess post-mortem, and Lumb ordered not to undertake an autopsy or draw conclusions on the cause of Sturgess’s death until Rutty arrived. Why? The sources are not saying whether the two forensic professors differed in their interpretation of the evidence; and if so, whether the published excerpt of Rutty’s report of Novichok poisoning is the full story.   

New developments in the official investigation of Sturgess’s death, now directed by Hughes, have removed the state secrecy cover for Rutty, Lumb, and other medical specialists who attended the post-mortem on July 17, 2018. The appointment by Hughes of a London lawyer, Adam Chapman, to represent Sergei and Yulia Skripal, opens these post-mortem documents to the Skripals, along with the cremation certificate, and related hospital, ambulance and laboratory records. Chapman’s role is “appropriate” – Smith’s term – for the Skripals to cross-examine Rutty and Lumb and add independent expert evidence.

Hughes’s appointment of another lawyer, Emilie Pottle (lead image, top left), to act on behalf of the three Russian military officers accused of the Novichok attack exposes this evidence to testing at the same forensic standard. According to Hughes,  it is Pottle’s “responsibility for ensuring that the inquiry takes all reasonable steps to test the  evidence connecting those Russian nationals to Ms Sturgess’s death.” Pottle’s responsibility is to  cross-examine Rutty and Lumb.

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KILLING IS CHEAPER — THE US ARMY SPECIAL OPERATIONS COMMAND WEAPONIZES TWITTER, FACEBOOK, INSTAGRAM, WHATSAPP, TELEGRAM

By John Helmer, Moscow
  @bears_with

The US Army’s Special Operations Command (SOCOM) has been firing several hundred million dollars’ worth of cyber warheads at Russian targets from its headquarters at MacDill Airforce Base in Florida. They have all been duds.

The weapons, the source, and their failure to strike effectively have been exposed in a new report, published on August 24, by the Cyber Policy Center of the Stanford Internet Observatory.  The title of the 54-page study is “Unheard Voice: Evaluating Five Years of Pro-Western Covert Influence Operations”.

“We believe”, the report concludes, “this activity represents the most extensive case of covert pro-Western IO [influence operations] on social media to be reviewed and analyzed by open-source researchers to date… the data also shows the limitations of using inauthentic tactics to generate engagement and build influence online. The vast majority of posts and tweets we reviewed received no more than a handful of likes or retweets, and only 19% of the covert assets we identified had more than 1,000 followers. The average tweet received 0.49 likes and 0.02 retweets.”

“Tellingly,” according to the Stanford report, “the two most followed assets in the data provided by Twitter were overt accounts that publicly declared a connection to the U.S. military.”

The report comes from a branch of Stanford University, and is funded by the Stanford Law School and the Spogli Institute for Institutional Studies, headed by Michael McFaul (lead image).   McFaul, once a US ambassador to Moscow, has been a career advocate of war against Russia. The new report exposes many of McFaul’s allegations to be crude fabrications and propaganda which the Special Operations Command (SOCOM) has been paying contractors to fire at Russia for a decade.

Strangely, there is no mention in the report of the US Army, Pentagon, the Special Operations Command, or its principal cyberwar contractor, the Rendon Group.

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MARIA YUDINA OUT OF THE DARK – THE RUSSIAN CLASSICAL PIANIST PLAYS AGAIN

By John Helmer, Moscow
  @bears_with

Maria Yudina (lead image) is one of the great Russian pianists. She was not, however, one who appealed to all tastes in her lifetime, 1899 to 1970.

In a new biography of her by Elizabeth Wilson, Yudina’s belief that music represents Orthodox Christian faith is made out to be so heroic, the art of the piano is diminished — and Yudina’s reputation consigned again to minority and obscurity. Russian classical music and its performers, who have not recovered from the Yeltsin period and now from the renewal of the German-American war, deserve better than Wilson’s propaganda tune.

(more…)
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