A recent international survey ranked Russia at 140 out of 186 nations in terms of Economic Freedom (how easy it is to start and run a business). The Russian score is 1.5 percent higher than last year, but that isn’t much considering how vocal the government has been about its efforts to address complaints from foreign firms who refuse to do business in Russia or are pulling their operations out of Russia. Most of the economic damage is done to Russian firms that are best by corruption and criminal gangs.
A recent opinion poll in Russia found that 57 percent of the population regretted the breakup of the Soviet Union in 1991. Only 30 percent had no regrets. The attitudes varied by age. Those 25-39 had only 39 percent unhappy with the breakup while for those 55 and older it was 86 percent. Only 29 percent of all respondents thought the breakup was inevitable and 53 percent believed it could have been avoided. One missing element to all this is the fact that when the Soviet Union broke up half the population went to the 14 new countries and most of those people were quite enthusiastic about ending the Soviet Union. Thus if you asked all citizens of the former Soviet Union what they thought of the breakup you would find about 70 percent with no regrets. That’s because the Soviet Union was basically the Russian Empire cobbled together by the old czarist monarchy over more than two centuries of conquest and expansion. Thus in the Soviet Union half the population felt like conquered people, not part of any union. The Soviet Union dissolved quickly in 1990-91 because over half the population really wanted it to happen and had wanted it for a long time. Many ethnic Russians were tired of supporting a lot of the less affluent conquered people and were fed up with the economic failures of communism. The former Soviet Union citizens who regret the breakup tend to be older people who were disillusioned at how corruption and bad leadership made post-Soviet life less wonderful than was expected. The younger people are more realistic, never having lived as adults in the Soviet Union and intimately familiar with the fact that freedom isn’t free and democracy is hard. For younger Russians there are more economic opportunities than under communism. While Russia lost half its population when the Soviet Union broke up, it hung on to most of the valuable natural resources (like oil and natural gas). While the post-Soviet government was reluctant to increase state supplied pensions (which were low during the Soviet period because there was little to spend it on and the state supplied housing and some health care), the pensions did eventually go up. But not as much as the economy grew and the working Russians were obviously doing better than the pensioners who had grown up under communism. In Soviet times that meant there was little economic opportunity and most everyone was equally poor. The old-timers never got used to the changes and most would prefer the communists to come back. That won’t happen and as the generations that grew up under communism die off so will any desire to return to the bad (but familiar) old days.
At the end of 2013 Russian completed converting one of silo based missile divisions from the Cold War era RS-18 (SS-19) to the new RS-24 “Yars”. A Russian ICBM division has three regiments each with three battalions and each battalion has three ICBMs. Russia believes Yars is a worthy successor to the venerable, reliable and aging RS-18s. Reinforcing that attitude was another successful test of an RS-24 on December 24th. Russia began deploying RS-24s in 2010. The latest move, to replace RS-18s with RS-24s indicates a high degree of confidence in the RS-24 and enough cash to retire the RS-18s and build RS-24s to replace them.
In Syria continued Russian support for the Assads has prevented the UN from passing resolutions condemning the ongoing government attacks on civilians. These attacks have been more blatant in the last month, as have Syrian efforts to prevent foreign aid from reaching the cold, hungry and often wounded civilians. The Russian government openly boasts (at least inside Russia) of how its backing of the Syrian government against a popular uprising has been successful. Recently Russian arms shipments (via air and sea) have increased and have included armored vehicles and UAVs. But the biggest boost for the Assads was Russia arranging a chemical weapons disarmament deal in Syria that crippled Western aid for the rebels and, along with thousands of Iranian supplied mercenaries, has the Syrian government on the offensive. The Assads continue to keep the economy going in areas they control with the help of Iran and Russia. Iran supplies the foreign currency and Russia helps get it into the international banking system so the Assads can still buy foreign goods. While Russia strongly opposes any foreign troops in Syria they are openly calling for foreign troops to remain in Afghanistan. That’s mainly because of the drugs, which are a major problem in Russia, and Islamic terrorists, which are more of a potential threat if Afghanistan ever again becomes a terrorist sanctuary.
The Russian government is negotiating a trade deal that will help Iran get around the international banking sanctions and be worth up to $1.5 billion a month. To do this Russia will sell Iran goods in exchange for oil, instead of cash. Russia will then mix this oil in with its own and dare the world to refuse it as illegal Iranian oil. This could get interesting because oil can be identified according to its chemical characteristics. That makes it possible to know which country, or even well, it came from. In effect, Russia is daring the world to try and stop it from helping Iran beat the sanctions. Russia has much to gain because of its close cooperation with Iran. For one thing, Iran has an excellent intel network in the Moslem world and apparently shares terrorist related items with Russia. Nearly all the Islamic terrorist activity against Russia is by Sunni groups, who also target Iran when they have a chance. Sunni Islamic radicals consider Shia heretics and worthy only of death. Russia also expects to have a good trade relationship with Iran once the current embargo is lifted. Then again that might not happen if the Iranian religious dictatorship falls and the new Iranian government is understandably hostile to those countries that helped keep the clerics in power. Iran officially denies this barter deal exists but Iran has long denied deals like that with Russia and China, and such deals tended to eventually be revealed as real.
Since late November 2013 Russian efforts to gain more control over the Ukrainian government have been running into growing popular opposition. Russia is angry over losing Ukraine in 1991 and is using the fact that 17 percent of Ukrainians (mainly in the southeast) are ethnic Russians and another five percent are various minorities to create a pro-Russian political block in Ukraine. Southeastern Ukraine is where most of the industry and Soviet era economic development was. Since the 1990s Russia has been using economic pressure and ethnic animosities to gain more influence over Ukrainian politics. But over the last nine weeks massive and persistent anti-Russian demonstrations all over the country, but particularly in areas where ethnic Ukrainians (77 percent of the population) were dominant have put the pro-Russian government on the defenseive. The largest demonstrations were in the Ukrainian capital (Kiev) and have stalled government efforts to replace a popular economic deal with the EU (European Union) with a less favorable arrangement with Russia. This represents a major defeat for Russian efforts to keep Ukraine from getting closer to Europe. Most Russians feel Ukraine should be a part of Russia, while most Ukrainians disagree. Still, for economic reasons many ethnic Ukrainians in the east back stronger ties with Russia. Ukraine got free in 1991 when the Soviet Union collapsed and want closer economic and political ties with Europe. To that end Ukraine began 2013 by signing a $10 billion contract with a major oil company to develop shale gas fields in Ukraine. Within a decade this could eliminate the need to import natural gas from Russia. This would free Ukraine from Russian threats to halt gas shipments if Ukraine did not do as it was told. This sort of thing has gotten nasty in the past. In 2009 a natural gas price dispute between Russia and Ukraine led to a compromise, but one aftereffect was growing anti-Russian sentiment among most Ukrainians. Ukraine accused Russia of fraud and intimidation. The tensions between Russia and Ukraine grew worse until the 2013 crises was reached. The trigger was a trade deal with the EU deal Ukrainian president Yanukovych promised to negotiate when he came to power in 2010. But once the deal came close to signing Russia responded with overt and secret deals that persuaded Yanukovych to change his mind. This enraged most Ukrainians who saw this as another example of the dirty dealing from the Russians that they wanted to get away from. Yanukovych has lost a lot of support in the security forces and has been unable to shut down the protests, which persist and get larger. The outcome is still in doubt.
Russia is defiant at public announcements by several Islamic terrorist groups that attacks will be made at the Winter Olympics being held at Sochi in southern Russia February 7-23rd. Russia has brought in over 100,000 security personnel to make sure that does not happen. But Islamic terrorists have recently been successful at making attacks in the vicinity of Sochi (southern Russia and areas bordering the Caucasus) and more Islamic terrorists have been detected (and some arrested) in the area. Some 10,000 of those security personnel are soldiers stationed in the mountains where many of the events will take place. Sochi and surrounding areas are being scoured for terrorism suspects, especially female suicide bombers (usually widows of male terrorists) that the Caucasus Islamic terrorists favor. The U.S. appears more concerned with the threat than European nations and the Russians are not happy about all the complaining the Americans are doing over the terrorism threat and the adequacy of Russian security measures. The Russians have been distributing the names and pictures of specific women they believe are being used in attacks in or near Sochi.
February 1, 2014: The U.S. has sent two warships (a command ship and a frigate) to the Black Sea to remain off the Russian coast during the Winter Olympics. The command ship is an 18,900 ton vessels with a crew of 325. There are accommodations for several hundred command personnel. Armament is light, consisting of two Phalanx anti-missile cannon, two 25mm autocannon and four 12.7mm machine guns. There are also missile and torpedo decoy systems. There is also a helicopter pad, and one SH-60 helicopter is carried. The major equipment on board are computerized communications systems that can handle lots of encrypted (coded) message traffic with lots of different allies. One of these ships is based in Italy, the other in Japan. When not at sea, they serve as floating headquarters, usually for one of the navy's fleets, while tied up at pier side. Off Sochi this ship is expected to ensure the U.S. will have communications with the area if there is a major terrorist attack.
January 30, 2014: Russia now has an “ambassador at large” for Russian claims to the Arctic regions. This ambassador regularly visits other nations bordering the Arctic to defend Russian claims on most of the Arctic waters and the natural resources there as well as anything below the seabed. This is in violation of international treaties, but Russia believes because it has the longest coastline bordering the Arctic it should be entitled to more. Russia is stationing more military forces on its Arctic coast, particularly aircraft and ships.
January 28, 2014: In the United States a Russian citizen being prosecuted for cybercrime admitted his guilt in developing malware used to attack at least 243 banks and get into over 10,000 bank accounts. The 24 year old Russian (Aleksander Panin) sold the malware online and was arrested at an American airport last July. Russia is under growing pressure from the West to crack down on the thriving network of computer criminals that have long thrived in post-Soviet Eastern Europe and Russia.
January 27, 2014: President Viktor Yanukovych of Ukraine admitted defeat and agreed to rescind anti-protest laws and free anti-Russian demonstrators jailed because of those laws in the last two months.
January 21, 2014: In the south (Dagestan) police cornered and killed Eldar Magatov, the leader of the Babayurtovskiy gang and suspected to involvement in efforts to carry out terrorist attacks at the nearby Winter Olympics. Elsewhere in Dagestan police disabled a terrorist bomb found in a village and made arrests of terrorist suspects.
January 19, 2014: A video was posted to a pro-Islamic terrorist website in which Islamic terrorists from the Caucasus took credit for two suicide bomb attacks in the Russian city of Volgograd (formerly Stalingrad) and promised more at the Winter Olympics.
January 18, 2014: In the south (Dagestan) police killed seven Islamic terrorists, including one who was apparently preparing to make attacks at the Winter Olympics.
January 16, 2014: In Ukraine the anti-Russian demonstrations have turned violent as the pro-Russian government tried using more force to shut down the popular pro-European Union movement. Demonstrators called for more vocal support from the West while Russia blamed it all on Western interference.
January 15, 2014: In 2013 sales for Russian defense industries grew 28 percent, largely because of more orders from the Russian government. Sales for defense industries in the U.S. and Western Europe were down.
In the south (Dagestan) Special Forces soldiers cornered two Islamic terrorists and killed them, but not before three soldiers were also killed and five wounded.
Indian Air Force officers have had an opportunity to check out prototypes of the new Russian “5th generation” T-50 (or PAK-FA) and have made comments to Indian journalists. The T-50 is the Russian answer to the U.S. F-22 and according to the Indian officers, who are contributing $6 billion to development of the T-50, the Russian aircraft is in big trouble. The Indian officers noted that the T-50 as it is currently put together is unreliable, especially the new engine. The Russian radar, which promised so much has delivered, according to the Indians, insufficient performance. The Indians also noted that the T-50s stealth features were unsatisfactory. The Indians are also unhappy with Russian refusal to share many technical details. The per-aircraft price is also considered too high. The Indian Air Force has not made an official statements on this matter.
January 13, 2014: For the first time since the Cold War ended in 1991 Russia has expelled and banned (for five years) an American journalist Russia accused of being anti-Russian. The writer had been critical of president Putin and much else that most Russians would agree with and wrote persuasively of the were major problems inside post-Soviet Russia.
January 12, 2014: In early January Russia’s only aircraft carrier, the Admiral Kuznetzov passed through the English Channel on its way to the Mediterranean. The carrier had five escort vessels and foreign military pilots flying close by could not help but notice that there was a lot of rust on the deck of the carrier. This was not a good sign. The Kuznetzov left its base in northern Russia on December 17th heading for the Syrian port of Tartus, where Russia has been building basing facilities for over a year. Western navy officers who have seen the Kuznetzov up close (it was in the Mediterranean two years ago) noted that the ship is long overdue for a major overhaul. The only other ship of the Kuznetzov class was purchased by the Chinese a decade ago and completely refurbished. It is now in service and looks a lot better than the original that serves as flagship of the Russian Navy. The Kuznetzov has had some updates since the 1990s but a lot of this work is suspect. Back in 2012 a military procurement official was prosecuted for substituting cheaper, substandard parts for new ones meant for the Kuznetzov. The corrupt official used forged documents to get away with this but members of the crew noticed the substandard parts and reported it. The Kuznetsov has been sent back to the shipyard several times during the last decade to fix problems and update equipment. Much was wrong with the ship, due to poor design, sloppy workmanship, or corruption. It’s gotten so bad that lackadaisical sailors are threatened with being sent to serve on the Kuznetsov as a way of motivating them