ALUMINIUM IS SOLID ELECTRICITY, BUT WHERE DOES THE PROFIT GO FROM TURNING ONE INTO THE OTHER?

zeus_deripaska

By John Helmer, Moscow

The ancients were pretty sure that when Zeus tossed his lightning and thunder bolts, he wasn’t well-intentioned, let alone fair-minded. It’s that way too in Russia when electricity gets distributed between the big shots and ordinary folk. The ancients were also sure Zeus could be bought off, but obviously not by those who couldn’t afford the temple offerings.

Last month, when Prime Minister Dmitry Medvedev, followed by President Vladimir Putin, and then Economy Minister Alexei Ulyukayev announced that they are going to freeze Russian power tariffs for next year, in effect distributing electricity at a discount to big shots, but keeping in place the 12% increase in the tariff for ordinary citizens, implemented on July 1, they were rewarding those in a position to pay off.
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BLOOD MEDIA — LET’S HEAR IT FOR INTERNATIONAL SANCTIONS AGAINST GOOGLE, YAHOO, FACEBOOK, MICROSOFT, APPLE, CISCO, AND OTHER US GOVERNMENT-BACKED VIOLATORS OF INTERNATIONAL HUMAN RIGHTS

blood_media

By John Helmer, Moscow

If the US Government and Congress believe they have the right to impose sanctions on Russian individuals and companies for conduct that is legal in Russian and international law, what would happen if the boot were on the other foot – if the Russian Government imposed sanctions on US individuals and corporations for violating Russian law?

The question arises often, very often. Two weeks ago, for instance, a group of US Senators told the US Treasury that VTB, Vnesheconombank and Gazprombank should be penalized for violating “international sanctions by enabling Syria to pay for imports and receive funds for exports. This assistance eases much of the financial burden on the Assad regime, allowing it to continue military purchases and pay the soldiers that sustain the war in Syria.” For background on Russia’s legal position toward the Syrian conflict, read this.
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RUSSIA’S SNAKE PIT — UP THE MONEY LADDER, DOWN THE POWER SNAKE

snake_pit

By John Helmer, Moscow

If the common Russian opinion of who runs the country matches the evidence of who really runs Russia, that’s a reliable test of a democratic culture.

There’s a catch. If just one man and a handful of his trusties run the country, and noone else, not even the very rich or very honest, can improve on their reputation for trust, capability, or popularity, then this must be a democracy without competition. Compared to democracies like the United Kingdom, United States, Italy, or France, where those who run the country are untrusted, incapable, and unpopular, and where the power elite buys election results, respectability, lordships, freedom from taxation, and immunity from prosecution, Russia must be a model of something unusual in politics.
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OLEG DERIPASKA’S EARS ARE BURNING — CORRUPTION ALLEGATIONS BY SAMUEL MEBIAME IN MIAMI TAPES

deripaska_ear

By John Helmer, Moscow

This week it’s hot and humid in Conakry, capital of the west African Republic of Guinea. It will hit 30 degrees in the day; the humidity will be 100%. Until Saturday, when the much-postponed, much-rigged parliamentary elections will be held, there will be occasional thunderstorms, sunny spells, and an inch of rain per day.

But there’s not enough water to douse the allegations that the President of Guinea, Alpha Conde, took payoffs through go-betweens to rig the presidential elections of June and November 2010; put up Guinea’s mining concessions for a fresh round of corrupt awards; and let Rusal off the hook of a billion-dollar compensation order by the Guinean Government and local courts.
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MAKING POTASH SAFE FOR DEMOCRACY — AFTER SULEIMAN KERIMOV’S EXIT, WHO’S NEXT?

manure

By John Helmer, Moscow

How many angels can dance on the point of a pin was a trick question for medieval scholars: that’s because, theologically speaking, angels have no substance. So the correct answer is that an infinity of them can sit on the point. Alternatively, since Thomas Aquinas (d. March 7, 1274) claimed two angels cannot occupy the same space, the answer is only one angel.

Fill a modern room on the bank of Lake Valdai last week with a couple of hundred academicians and reporters, most of them from states bent on regime change in Russia, and the headline question they want to debate is: will President Vladimir Putin (standing figure centre) run for re-election in 2018?
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NO WINGS TO FLY — QIWI CALLS TIME, OR IS IT A CUCKOO?

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By John Helmer, Moscow

If QIWI, the Russian electronic payments operator, is such a good thing, why did the market cut the stock price the minute QIWI announced this week that it’s planning to sell off more of the control shareholders’ shares?

QIWI was co-founded by Alisher Usmanov’s internet portal company, Mail.ru, and Usmanov continues to be one of QIWI’s biggest clients and sources of cashflow. In May, QIWI launched an initial public offering (IPO) of 12.5 million shares on the US Nasdaq exchange. Usmanov was the biggest seller at the time. Through Mail.ru, he started with 21.4% of the issued share capital, and ended up with 19.4% of the voting shares. He was followed by Andrei Romanenko, QIWI’s board chairman and one of the co-founders, who started with 12.7%, and ended with 8.6%. For the May 3, 2013, prospectus, read this.
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WARNING FROM VLADIMIR PUTIN TO OLEG DERIPASKA — BE NICER TO PEOPLE

deripaska_putin

By John Helmer, Moscow

The last time President Vladimir Putin publicly criticized Oleg Deripaska, chief executive of United Company Rusal and Russia’s most indebted man, it was at Pikalevo, Leningrad region, in June of 2009. Putin tossed his pen at Deripaska, told him to sign a back-pay agreement, and demanded his pen back. Referring to the failure to pay wages to the town’s alumina and cement factory workers, Putin told Deripaska: “Why has your factory been so neglected? They’ve turned it into a rubbish dump. Why was everyone running around like cockroaches before my arrival? Why was no one capable of taking decisions?..you’ve made thousands of residents of Pikalevo hostages of your ambition, your nonprofessionalism and maybe your greed. Thousands of people. It’s totally unacceptable.”

The pen-tossing and televised chastisement of Deripaska were followed by substantial new state bank and budget funds to cover Deripaska’s payouts at Pikalevo. In September, after everyone had taken their summer holidays, Deripaska claimed Putin hadn’t meant what he seemed on camera to be doing. “The problem”, said Deripaska, “was that the reality of the meeting event and the picture, which was transmitted by the television channels, did not coincide. This was a simple case of editing. Actually, everything went in another way. What happened at the meeting was very productive; the decisions taken to revive manufacture have been implemented.”
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ALROSA REPORTS PROFIT GROWTH AS DIAMOND PRICES GAIN — PRODUCTION PAY RISES BUT MANAGEMENT IS CUT

alrosa_rabbit

By John Helmer, Moscow

Diamond prices have been growing in the global market since January, but depending on your choice of accounting period, the growth rate is either not much; or not at all; or negative since July. Alrosa, the state-owned diamond miner directed by Fyodor Andreyev (image left), reported its latest financial results this week, noting “positive dynamics in the diamond markets in H1 2013, which resulted in a 7% growth of rough diamond prices since the beginning of 2013.”

The company is hoping to make a start selling 14% of its shares on the Moscow Stock Exchange next month, so it’s putting its best foot forward. A bloc of 7% will come from the 51% shareholding of the federal government; another 7% bloc will come from the Sakha republic’s 32% holding. The regional authorities want the privatization to go no further; so they won’t be too unhappy if share sale demand fails to reach Andreyev’s top of the range valuation at $15 billion. Vladimir Potanin, who was interested in taking over the company in the late 1990s, announced this week he isn’t interested in buying shares, and for good measure accused the federal government of artificially stoking demand.
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FITCH DOWNGRADES INTERPIPE TO DEFAULT — VICTOR PINCHUK TO ASK ITALIANS FOR RESCUE FROM RUSSIAN AND AMERICAN MOVES

ukr_eu_interpipe

By John Helmer, Moscow

The international ratings agency Fitch has downgraded its assessment of the Ukrainian pipemaking group Interpipe, owned by Victor Pinchuk, warning that Russian action since July to impose penalty duties on Ukrainian pipe imports is causing a serious loss of sales and a grave shortage of cash for Interpipe. If that continues, a release from Fitch says, the company “is unlikely to be able to meet its scheduled debt repayments.” The Fitch report was issued in London on Monday. It comes just three months after the agency had reported that the outlook for Interpipe as stable, confirming at the time Interpipe’s B- rating.

In the latest action Fitch says it is downgrading Interpipe to CCC. Sources close to recent talks between Fitch and Interpipe describe the triple-C rating as indicating, according to the Fitch methodology, the high probability of default.
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GETTING A MONOPOLY GRIP ON THE BOX TRADE — WILL THE KREMLIN, OR VLADIMIR LISIN, ALLOW MAERSK TO TAKE OVER RUSSIA’S CONTAINER BUSINESS?

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By John Helmer, Moscow

The takeover announced at the start of this month by Global Ports Investments (GPI) of the National Container Company (NCC) gives control of more than 72% of container transportation volume in Russia’s west, including the Black and Baltic Seas; and more than 82% of Russian box volume in the northwest, from the Gulf of Finland to the Arctic. Calculations by Moscow maritime expert Alexei Bezborodov indicate that with accumulated capacity of 1.7 to 1.8 million Teu per annum, Global Ports is taking “a monopoly position in the market”. Teu stands for twenty-foot equivalent unit, a measure of container length and of cargo capacity roughly equal to 22.6 tonnes.

As of August 31, the volume of the total Russian market stands at 3.5 million Teu. In the Russian Fareast, volume is currently 1 million Teu.
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RUSAL’S CHICHIKOV STRATEGY — OLEG DERIPASKA CLAIMS TO BE REDUCING ALUMINIUM PRODUCTION, ADDING JOBS; BUT THE DEAD SOULS HAVE VOTED FOR HIS OLD ENEMY ANATOLY BYKOV IN KRASNOYARSK

chichikov_deripaska

By John Helmer, Moscow

In Gogol’s well-known story Dead Souls, Chichikov (left), the central character and villain of the piece, makes a lucrative business of buying the names of dead serfs from local census rolls in order to cut the tax liabilities of landowners, accumulate fake collateral against which he intends to borrow, and then retire in wealth. In the more up to date case of the state-funded aluminium monopoly, United Company Rusal, the business is to keep filling the names on the employment rolls while disposing of their jobs and eliminating the unsellable surplus of their production.

The idea of Oleg Deripaska (right), Rusal’s chief executive and trustee for the state owners of the company, is that if the souls protest their loss of work and income, they won’t be convincing to the Kremlin so long as Rusal claims to be paying them for work no longer done. Rusal’s published rationale for what is happening is that until international demand for aluminium raises the price of the metal in trade, it must cut supply to the market. That’s problematic because of the large accumulation of unsold aluminium in uncounted warehouse inventories. That story can be read here.
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IGOR SECHIN TO SULEIMAN KERIMOV — YOU’RE NOT A FERRARI, I’M NOT A PALM TREE

ferrari_tree

By John Helmer, Moscow

To the disability of being unable to speak his mind in public Suleiman Kerimov has the added handicap of being unable to accept how short his arms are, particularly when handling money from state banks. In overreaching himself Kerimov has provided a case study of how President Vladimir Putin expects the Russian oligarchy to conduct its business when state interests are at stake; and also of the continuing importance of former deputy prime minister Igor Sechin, now chief executive of the Rosneft oil company.

In July Kerimov got too big for his boots when he believed he had Kremlin support for upsetting the potash cartel known as the Belarusian Potash Company (BPC), directly threatening President Alexander Lukashenko of Belarus. The BPC, headquartered in Minsk since 2005, was a Russian creation — successor to a line of trading organizations for the concealment of potash sale profits with names like Ferchimex (Belgium), Bermont (Switzerland), Fertexim (Cyprus), and Uralkali Trading (Switzerland). All of them were the creation of the fertilizer, I mean fertile, mind of Dmitry Rybolovlev, whom Sechin drove out of the potash business in 2010, replacing him with Kerimov. Sechin failed to oust Rybolovlev’s trader, Oleg Petrov, who stayed on to teach Kerimov the tricks of the trade.
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IN THE OLIGARCH’S BACKYARD — MR & MRS ANDREI MELNICHENKO SUE FOR 100 CENTIMETRES

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By John Helmer, Moscow

Nothing so reveals the character of the men on the commanding heights of the Russian economy than a lawsuit in an international court initiated by their wives against one of their tradesmen.

In the case which recently came to light, Aleksandra Melnichenko (nee Nikolic), wife of the fertilizer oligarch Andrei Melnichenko, sued a New York art dealer for more than €5 million, including triple punitive damages, for putting the wrong thing in her garden. This beats the record for a backyard claim previously set in a Washington, DC, court by Elena Pinchuk – daughter of the ex-President of Ukraine, Leonid Kuchma, and current wife of Victor Pinchuk.

The New York case turned on Mrs Melnichenko’s claim that she had ordered her sculpture to be 220 centimetres in height, but she got only 120 centimetres. The missing 100 centimetres, she claimed, was not only an aesthetic violation and a lapse of taste, but also a breach of contract, and worse, a case of fraud. Hence the triple damages.
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SHOWDOWN ON THE ICEPACK — RUSSIA INTENSIFIES CONTROL OVER NORTHERN SEA ROUTE SHIPPING, BUT SUEZ MAY STILL WIN

smp_ice

By John Helmer, Moscow

As larger cargo volumes and more international vessels move through Arctic waters, or the Northern Sea Route as the passage is generally called in Russian (SMP is the cyrillic acronym, NSR in English), the Kremlin’s strategy is to fund the construction of the most powerful nuclear icebreakers in the world, and ensure they dominate future navigation and convoys. These vessels are very expensive to build and to operate, however. So costly that just a few days of extra time navigating the icepack could eliminate the cost advantage which the Northern Sea Route is currently advertising over the Suez Canal alternative.

Because of the lack of ports along the Arctic shores, and tight beam and draught limits for vessels to navigate the eastern Laptev and Sannikov narrows, ten new Russian navigational and emergency centres will be installed over the next decade to bring the new traffic under Russian supervision and regulation. But there are technical problems with the maintenance of hundreds of strontium-90 powered navigational beacons installed along the coast line. Customs, coast guard, and special forces units are also being reinforced and tested to give the Russian regulatory authorities teeth to react to what the Kremlin considers foreign territorial or commercial threats. Ironically, according to one Moscow source, the satellite imaging used by the Russians to identify and navigate around thick ice concentrations is Canadian, not Russian.
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EVRAZ SAYS NEMASCORE DELAYING HIGHVELD STEEL DEAL; RUSSIAN GOVERNMENT REPEATS DEMANDS FOR ZUMA TO MAKE UP HIS MIND

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By John Helmer, Moscow

Evraz, the steelmaking group owned by Roman Abramovich and Alexander Abramov, has revealed that it cannot complete the sale of its South African steel subsidiary, Highveld Steel & Vanadium, on time, and that the South Africans are the reason for the fresh delay.

At the same time, Russian Foreign Minister Sergei Lavrov told his South African counterpart, Maite Nkoana-Mashabane, in Moscow on Monday that the Kremlin wants to see less delay, more commitment from President Jacob Zuma on buying nuclear power reactors from Rosatom. Zuma, who has now arrived in St. Petersburg for the G-20 summit meeting, has met President Vladimir Putin twice already this year – in Durban in March, and in Sochi in May – and on each occasion the official communiques have pledged the same thing. Lavrov repeated this on Monday when at a press conference with Nkoana-Mashabane, he said Russia’s priority in its bilateral relationship with South Africa is the billion-dollar sale and purchase of reactors. “Russia is ready to assist in the creation in the Republic of South Africa of nuclear power,” Lavrov said. This, Lavrov emphasized, is the priority in “the complex of bilateral ties…further steps for implementation of these major arrangements…[and] the activization of investment cooperation.”
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SOVCOMFLOT SINKS INTO THE RED, SERGEI FRANK PREDICTS BOTTOM

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By John Helmer, Moscow

Sovcomflot, the state-owned Russian tanker company, has reported that its vessel operating profit collapsed from $101.7 million to just $31.7 million in the six months to June 30, while on the bottom-line the company reported a net loss of $14.5 million; this compares with a profit of just $2 million in the first quarter, and a profit of $51 million in the first half of 2012. This is the first loss ever booked in Sovcomflot’s audited reports.
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PRICES FOR DAMIEN HIRST AND JEFF KOONS TAKE BATH, AS VICTOR PINCHUK’S STEEL EMPIRE FALLS ON TOP OF THE ART MARKET

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By John Helmer, Moscow

After months of delay, Victor Pinchuk’s Interpipe group revealed in its financial report for last year — issued at the start of August but given a release date of May 23 – how much financial trouble the Ukrainian pipe and steelmaker is now facing. The impact of this on the international art market is about to be felt in art auctions scheduled for later this month and in October in London and New York. That’s because Pinchuk’s record-priced acquisitions of two artists, Englishman Damien Hirst and American Jeff Koons, have created an overhang of their works in the market place. According to speculation by London and New York art dealing sources, these works may be forced into sale at a heftier discount than Hirst and Koons have already been taking.

Art market reports show that sales by Hirst have dropped from $45.8m in 2008 to $18.3m in 2012 – and that doesn’t count the volume of works failing to sell at all. Since then, according to the New York Times, Hirst works are fetching 60% less than was originally paid for them. To reduce the supply, Hirst’s production company Science Ltd. has issued a catalogue itemizing one line of purportedly authentic works and inviting owners to apply to Hirst for an authenticity check.
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GUNG-HO OR GUNG-HOOEY – WHAT DID ANDREI MELNICHENKO KNOW, OR FAIL TO KNOW, ABOUT THE KREMLIN PLAN FOR THE POTASH PRICE?

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By John Helmer, Moscow

On December 7, 2012, Andrei Melnichenko (image right, right) told prospective buyers of $750 million in loan participation notes that he was gung-ho on the future of the potash business of his Eurochem group. For Eurochem — 92% owned by board chairman Melnichenko; 8% by chief executive Dmitry Strezhnev – potash was, still is, a brand-new line of business. But in a decade or so, Melnichenko told investors, he aimed to be number-1 for potash in Russia and in Europe; and for potash, nitrogen and phosphate fertilizers combined, close to number-1 in the world.

Apparently nothing stood in his way – not Uralkali, Russia’s current potash monopoly producer; nor Suleiman Kerimov (left, left), the control shareholder of Uralkali. Not Belaruskali, the state-owned potash monopoly of Belarus, nor Belarus President Alexander Lukashenko. Those four names don’t appear in the risk or strategy sections of Melnichenko’s investment prospectus, a copy of which has just fallen from a Eurochem truck. How he proposed to defeat such rivals the Eurochem prospectus didn’t even acknowledge as a problem. Can Melnichenko have been so unthinking as to expect his rivals to surrender their market positions and profits without a fight? Did Melnichenko take his bond buyers for dolts and boobies?
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AFTERSHOCK OF NORD STREAM EXPLOSIONS RUMBLES WARSAW — POLISH POLITICIANS GO “NUTTERS”

By John Helmer, Moscow
  @bears_with

The Polish government in Warsaw, facing re-election in less than a year, wants all the credit from Washington for their joint operation to sabotage the Nord Stream gas pipelines on the Baltic seabed.

It also wants to intimidate the German chancellor in Berlin, and deter both American and German officials from plotting a takeover by the Polish opposition party, Civic Platform, next year.

Blaming the Russians for the attack is their cover story. Attacking anyone who doesn’t believe it, including Poles and Germans, Warsaw officials and their supporting media claim they are dupes or agents of Russian disinformation.

Their rivals, Civic Platform (PO) politicians trailing the PiS in the polls by seven percentage points,   want Polish voters to think that no credit for the Nord Stream attack should be earned by the ruling Law and Justice (PiS) party. They also want to divert  the Russian counter-attack from Warsaw to Washington.

“Thank you USA” was the first Polish political declaration tweeted hours after the blasts by Radoslaw Sikorski (lead image, left), the PO’s former defence and foreign minister, now a European Parliament deputy. In support and justification,  his old friend and PO ministerial colleague, Roman Giertych, warned Sikorski’s critics: “Would you nutters prefer that the Russians find us guilty?”

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THE BORNHOLM BLOW-UP REPEATS THE BORNHOLM BASH — POLAND ATTACKS GERMANY AND BLAMES RUSSIA

By John Helmer, Moscow
  @bears_with

The military operation on Monday night which fired munitions to blow holes in the Nord Stream I and Nord Stream II pipelines on the Baltic Sea floor, near Bornholm Island,  was executed by the Polish Navy and special forces.

It was aided by the Danish and Swedish military; planned and coordinated with US intelligence and technical support; and approved by the Polish Prime Minister Mateusz Morawiecki.

The operation is a repeat of the Bornholm Bash operation of April 2021, which attempted to sabotage Russian vessels laying the gas pipes, but ended in ignominious retreat by the Polish forces. That was a direct attack on Russia. This time the attack is targeting the Germans, especially the business and union lobby and the East German voters, with a scheme to blame Moscow for the troubles they already have — and their troubles to come with winter.

Morawiecki is bluffing. “It is a very strange coincidence,” he has announced, “that on the same day that the Baltic Gas Pipeline  opens, someone is most likely committing an act of sabotage. This shows what means the Russians can resort to in order to destabilize Europe. They are to blame for the very high gas prices”.   The truth bubbling up from the seabed at Bornholm is the opposite of what Morawiecki says.

But the political value to Morawiecki, already running for the Polish election in eleven months’ time, is his government’s claim to have solved all of Poland’s needs for gas and electricity through the winter — when he knows that won’t come true.  

Inaugurating the 21-year old Baltic Pipe project from the Norwegian and Danish gas networks, Morawiecki announced: “This gas pipeline is the end of the era of dependence on Russian gas. It is also a gas pipeline of security, sovereignty and freedom not only for Polish, but in the future, also for others…[Opposition Civic Platform leader Donald] Tusk’s government preferred Russian gas. They wanted to conclude a deal with the Russians even by 2045…thanks to the Baltic Pipe, extraction from Polish deposits,  LNG supply from the USA and Qatar, as well as interconnection with its neighbours, Poland is now secured in terms of gas supplies.”

Civic Platform’s former defence and foreign minister Radek Sikorski also celebrated the Bornholm Blow-up. “As we say in Polish, a small thing, but so much joy”.  “Thank you USA,” Sikorski added,   diverting the credit for the operation, away from domestic rival Morawiecki to President Joseph Biden; he had publicly threatened to sabotage the line in February.  Biden’s ambassador in Warsaw is also backing Sikorski’s Civic Platform party to replace  Morawiecki next year.  

The attack not only escalates the Polish election campaign. It also continues the Morawiecki government’s plan to attack Germany, first by reviving the reparations claim for the invasion and occupation of 1939-45;  and second, by targeting alleged German complicity, corruption,  and appeasement in the Russian scheme to rule Europe at Poland’s expense. .

“The appeasement policy towards Putin”, announced PISM, the official government think tank in Warsaw in June,  “is part of an American attempt to free itself from its obligations of maintaining peace in Europe. The bargain is that Americans will allow Putin to finish building the Nord Stream 2 pipeline in exchange for Putin’s commitment not use it to blackmail Eastern Europe. Sounds convincing? Sounds like something you heard before? It’s not without reason that Winston Churchill commented on the American decision-making process: ‘Americans can always be trusted to do the right thing, once all other possibilities have been exhausted.’ However, by pursuing such a policy now, the Biden administration takes even more responsibility for the security of Europe, including Ukraine, which is the stake for subsequent American mistakes.”

“Where does this place Poland? Almost 18 years ago the Federal Republic of Germany, our European ally, decided to prioritize its own business interests with Putin’s Russia over solidarity and cooperation with allies in Central Europe. It was a wrong decision to make and all Polish governments – regardless of political differences – communicated this clearly and forcefully to Berlin. But since Putin succeeded in corrupting the German elite and already decided to pay the price of infamy, ignoring the Polish objections was the only strategy Germany was left with.”

The explosions at Bornholm are the new Polish strike for war in Europe against Chancellor Olaf Scholz. So far the Chancellery in Berlin is silent, tellingly.

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LEMONS, MIMOSAS, AND STALIN’S SHOVEL

By John Helmer, Moscow
  @bears_with

The only Russian leader in a thousand years who was a genuine gardener and who allowed himself to be recorded with a shovel in his hand was Joseph Stalin (lead image, mid-1930s). Compared to Stalin, the honouring of the new British king Charles III as a gardener pales into imitativeness and pretension.   

Stalin cultivated lemon trees and flowering mimosas at his Gagra dacha  by the Black Sea in Abkhazia.  Growing mimosas (acacias) is tricky. No plantsman serving the monarchs in London or at Versailles has made a go of it in four hundred years. Even in the most favourable climates, mimosas – there are almost six hundred varieties of them — are short-lived. They can revive after bushfires; they can go into sudden death for no apparent reason. Russians know nothing of this – they love them for their blossom and scent, and give bouquets of them to celebrate the arrival of spring.

Stalin didn’t attempt the near-impossible, to grow lemons and other fruit in the Moscow climate. That was the sort of thing which the Kremlin noblemen did to impress the tsar and compete in conspicuous affluence with each other. At Kuskovo, now in the eastern district of Moscow, Count Pyotr Sheremetyev built a heated orangerie between 1761 and 1762, where he protected his lemons, pomegranates, peaches, olives, and almonds, baskets of which he would present in mid-winter to the Empress Catherine the Great and many others. The spade work was done by serfs. Sheremetyev beat the French king Louis XIV to the punch – his first orangerie at Versailles wasn’t built until 1763.

Stalin also had a dacha at Kuskovo But he cultivated his lemons and mimosas seventeen hundred  kilometres to the south where they reminded him of home in Georgia. Doing his own spade work wasn’t Stalin showing off, as Charles III does in his gardens, like Louis XIV before him. Stalin’s spade work was what he had done in his youth. It also illustrated his message – “I’m showing you how to work”, he would tell visitors surprised to see him with the shovel.  As to his mimosas, Stalin’s Abkhazian confidante, Akaki Mgeladze, claimed in his memoirs that Stalin intended them as another lesson. “How Muscovites love mimosas, they stand in queues for them” he reportedly told him.  “Think how to grow more to make the Muscovites happy!”

In the new war with the US and its allies in Europe, Stalin’s lessons of the shovel and the mimosas are being re-learned in conditions which Stalin never knew – how to fight the war for survival and at the same time keep everyone happy with flowers on the dining table.

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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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