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Generational Dynamics Web Log for 20-Dec-2013
20-Dec-13 World View -- Russia to free Pussy Riot, Greenpeace activists and Khodorkovsky

Web Log - December, 2013

20-Dec-13 World View -- Russia to free Pussy Riot, Greenpeace activists and Khodorkovsky

Obamacare goes into total panicked chaos

This morning's key headlines from

Russia to free Pussy Riot, Greenpeace activists and Khodorkovsky

Warm, friendly, smiling Vladimir Putin, with a twinkle in his eye, at a press conference on Thursday
Warm, friendly, smiling Vladimir Putin, with a twinkle in his eye, at a press conference on Thursday

It seems that Russia's president Vladimir Putin must be in a Christmassy mood. Russia's parliament, presumably with Putin's blessing, on Wednesday approved a sweeping amnesty law that will free tens of thousands of prisoners from Russia's prisons. The amnesty law will apply primarily to retirees, invalids, women with children and pregnant women, and victims of the Chernobyl disaster.

The amnesty law will free the "Pussy Riot" girls who, last year in February, charged up to the front of Moscow's Cathedral of Christ the Saviour during a service and sang a song criticizing Putin. The incident might have been forgotten, but the girls put the whole performance on YouTube, where it became viral. They were tried and convicted of hooliganism, and were threatened with being jailed for years. The new amnesty law means that they'll be free soon.

The amnesty law will also applies to the Greenpeace activists who, in October, attempted to scale a Gazprom offshore oil platform in the Arctic Ocean, hoping that the big publicity stunt would embarrass the Russians. They also faced years of jail time on charges of hooliganism, but the new law will free them as well.

The amnesty will also apply to Mikhail Khodorkovsky (see next item).

Putin's warm-hearted gestures come just a couple of days after the visit to Moscow by Ukraine's president Viktor Yanukovich. During their meeting, Putin kindly offered to loan $15B in aid to Ukraine, with no strings attached, to keep Ukraine from defaulting on its foreign debt. Ukraine wouldn't have to join Putin's Eurasia Customs Union, and Ukraine would still be allowed to trade with the European Union.

It's thought that Putin is going all out to put on a warm, friendly face for the Winter Olympics to be held in Sochi in February, only six weeks from now. Leaders of several European countries -- France, Germany, Lithuania -- have announced that they will boycott Sochi because of human rights issues in Russia. By freeing thousands of prisoners, including high-profile prisoners like Pussy Riot, Greenpeace activists, and Khodorkovsky, Putin may hope to reduce the volume of some of the planned human rights protests. The same reasoning applies to the free gift to Ukraine, where the pro-Russian government has been facing massive anti-government protests.

I would suggest that anyone receiving amnesty under this law should try to get out of Russia before the end of the Olympics games, because Putin may not feel so Christmassy at that time. Ria Novosti and BBC

Putin announces that Mikhail Khodorkovsky will be freed

The biggest amnesty news came on Thursday, when Russia's president Vladimir Putin made an informal remark after a press conference that Mikhail Khodorkovsky would be freed after ten years.

In 2004, for some reason that I no longer remember, I became fascinated by the sage of Mikhail Khodorkovsky and his company Yukos. Khodorkovsky was CEO of Yukos, Russia's second largest oil company; it was so big that it supplied 11.4% of all the oil for the WHOLE WORLD, and alone accounted for 4% of Russia's economy.

Khodorkovsky's fatal mistake occurred in October, 2003, when he announced a political campaign against Putin. Khodorkovsky was arrested shortly after that.

In 2004, we saw a series of moves designed to allow Putin to nationalize Yukos. Anyone interested can look at the series of articles on my web log from 2004. But I'll only mention the final step, which was worthy of being the grand finale of a comic opera.

After a series of steps designed to drive Yukos into bankruptcy, in December, 2004, Putin's judiciary was about to hold an auction of Yukos's assets. It was expected that Gazprom would be the major bidder, which would complete the nationalization of Yukos. (See "After a week of high comedy, who the heck is Baikal?" from 2004.)

It really was high comedy all the way. In an attempt to delay the auction, Yukos' lawyers asked a court to stop it. And which court did they go to? They when to an American bankruptcy court in Houston, Texas!! And the Houston court obliged, ordering the Russian government not to hold the auction on Sunday. The bankruptcy court's ruling was upheld on Saturday evening by an American federal appeals court.

Well, the auction was held on Sunday anyway, and Gazprom did not even bid on it. Instead, the winning bid was a very low $9.4 billion from the Baikal Finance Group, which had a small energy subsidiary.

Well, who the heck was Baikal? Nobody knew, and there were a lot of people following this deal. Well, a couple of days later, some reporters tracked it down. Baikal's address was a liquor store in Tver, a city 100 miles from Moscow, and reporters visiting there were told that they never heard of Baikal, and had never been visited by any oil tycoons. In the end, Baikal was just an empty shell company that Putin used in his scheme to nationalize Yukos.

Meanwhile, Khodorkovsky was still in jail, and in the last ten years, Putin has repeatedly made statements suggesting that he would be in jail for the rest of his life. It was just a couple of months ago that a Kremlin official said that they were filing new charges against Khodorkovsky to make sure that he never gets out.

So that's why everyone was so surprised on Thursday, when warm, friendly Uncle Vlad said that Khodorkovsky would soon be freed. Apparently Khodorkovsky himself was not aware that this would happen, nor were his lawyers or his family.

During 2004, when I followed the Yukos story, I was astounded how vicious and crooked Putin is, and how easily he got away with it, which seems to be the power of some politicians. There have been many more examples of Putin's unscrupulousness since 2004, of course, but I certainly do not believe that this amnesty program or the freeing of Khodorkovsky have anything to do with the claimed humanitarian concerns. I would repeat the advice I gave above: Especially for Khodorkovsky, get out of Russia if you can before the Sochi Olympics games end, because Putin may then look for a new excuse to put you back in jail. Moscow Times and CS Monitor

Obamacare goes into total panicked chaos

The Obamacare web site,, continues to be the greatest IT disaster in the world, while Obamacare policies continue in total chaos. (See "1-Dec-13 World View -- Obamacare: 500M lines of code, $500M, only 60% completed")

Now, as January 1 approaches, when millions of people will become uninsured because of Obamacare, the administration announced late Thursday evening another rules change, allowing people to buy "catastrophic" plans that are forbidden under the law as passed by Congress. One insurance industry official said that this last minute panicked change "will cause tremendous instability in the marketplace."

As long-time readers know, when the plan was announced in 2009, I wrote that it would be "economic insanity" because it would be a repeat of President Richard Nixon's wage-price controls that were announced in August, 1972. The chaos was overwhelming, with a welter of rules that no one could really figure out. (As one politician said, "Remember, Virginia, when itís a cucumber you can raise the price, but when it becomes a pickle, [the price is] frozen.") There was one fix after another to save the program, but in the end it was a total disaster for the economy. Instead of lowering the inflation rate to 2%, as had been predicted, the inflation rate shot up to 12%, because the wage-price controls program screwed up the economy so much. It took a decade for the economy to recover.

Now we're seeing the same thing happen again. Obamacare is an unmitigated disaster for the health care industry and for the economy, and every time they try to save it with some new tweak or adjustment, they make the situation worse. Fox News

(Comments: For reader comments, questions and discussion, see the 20-Dec-13 World View -- Russia to free Pussy Riot, Greenpeace activists and Khodorkovsky thread of the Generational Dynamics forum. Comments may be posted anonymously.) (20-Dec-2013) Permanent Link
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