Where there’s smoke…

No, today’s post isn’t about yesterday’s massive fire at the Ministry of Defense in Moscow. Today’s post is about the so-called “Panama Papers,” a massive investigative journalism project on money laundering and offshore accounts whose findings were initially released yesterday evening, while additional material is planned to be released gradually over the next couple weeks. This was the upcoming “information attack” that had Russian officials so hot and bothered last week, specifically, the part of the initial release that deals with Putin’s connection to a secret offshore account holding $2 billion dollars. Yes, those dollars, the ones that pro-Kremlin pundits keep telling us are about to be worthless any day now.

Of course Putin was by no means the only politician implicated in the investigation. Ukrainian businessman-turned-president Petro Poroshenko was also busted (take a guess which president’s scandal got reported in the Russian media, just for fun). Iceland, where people apparently give a shit about whether or not their leaders are thieves, may see a call for snap elections after the leak’s revelations about the prime minister’s offshore accounts. Hopefully the PM will only be replaced and not punished via the “Blood Eagle.” All in all it’s been a major bombshell. I mean who could have imagined that in a system that massively favors the wealthy, those individuals would take advantage of that fact to hoard money and avoid paying taxes like everyone else? In any case, the employees of the Panama-based Mossack Fonseca lawfirm at the center of the story are likely to have a lot of long chats with various investigators, which will of course no doubt be held in comfortable conference rooms served with tea, coffee, and bottled water. Nobody will be slammed to the pavement or into a car windshield, as one does with a youth suspected of stealing a bag of chips or a cell phone. Seriously, how did this system manage to fail us, so terribly, in this unprecedented and totally isolated instance?!

Getting back to Moscow, the Russian state media’s predictable response has been to ignore the story, which is setting off alarm bells around the rest of the world. Having spent nearly a week preemptively denying the story as more Western propaganda concocted solely to smear the Glorious Leader, the Russian state media and Kremlin officials seem to show no interest in even attempting to debunk the patently absurd claims that the Glorious Leader might have corrupt dealings. Now as for all those other politicians caught by the leak, especially Poroshenko, well obviously they’re actually guilty.

The Panama Papers are said to be one of the biggest leaks in history, and as they only started to be published yesterday evening I’m still reading up on them. I cannot offer much in the way of analysis at this point, but when it comes to the Kremlin’s denial and their overall narrative on topics like these, there’s a lesson to be learned.

Kremlin apologists have a tricky way of responding to allegations of corruption. One of the most common arguments is what is commonly known as “good tsar, bad boyars.” This means that corruption is pinned on faceless, usually nameless bureaucrats, but Putin is a hero who must not be questioned. It is often said that he is unaware of corruption at lower levels, and it is implied that he cannot do anything about this. While it is true that there’s a lot of low-level corruption all the way down to the street level and Putin cannot possibly know any details about this, he must at least be aware that it exists. If not, he is totally and utterly incompetent and cannot be called a leader by any stretch of the imagination. And if he is aware but powerless to do something about that corruption, he is still incompetent. If he is aware and unwilling to do anything about it, he is even worse; he’s malevolent in words of Epicurus.

Of course at times government apologists will try to deny massive corruption, or deny that it is any worse than in the rest of the world, including leading industrial economies. Here’s where we get to the heart of the matter. If corruption in Russia is not considerably quantitatively and qualitatively different than that in other leading industrialized nations, specifically liberal democracies, then why don’t those countries resemble Russia more? Is say, Canada, just as much a kleptocratic dictatorship as Putin’s Russia? Well let’s see…Their leaders change after contested democratic elections wherein opponents are not labeled “national traitors,” harassed physically and via the courts,and blacked out of the media. As far as I know they are not known for having a string of massive boondoggle projects, some of which haven’t achieved anything yet whose contractors, friends of the prime minister, still manage to grow massively rich off the deals. I highly doubt all of Canada’s richest individuals happen to be close friends of the current or former prime minister. I bet I could find one or two who are quite opposed to the ruling political party’s policies.

Sure, maybe the narrative about Putin’s Russia being a kleptocracy is nothing but a Western invention, but you know, doesn’t it really kind of look like what you’d expect a corruption-ridden kleptocracy to look like? The richest and most successful people just happen to be close friends of the president. They always get massive state contracts. They’re never investigated by the state. If someone lower down on the totem pole does something so egregious as to warrant some kind of prosecution, they are given a slap on the wrist, whereas people who would otherwise be nobodies face stiff sentences for the most wildly-concocted charges. Politicians and their assistants display wealth far beyond that which their official salaries should be able to afford, and their kids live and play in Paris, London, or Brooklyn. Meanwhile roads are crumbling. Pensions are frozen. Thousands go without pay for weeks, sometimes months. Clinics, hospitals, and orphanages sometimes look like scenes from a third world country. Yet the country is so rich with resources, and we know it made a killing off of oil and gas back in the mid-2000’s. It really looks like a lot of that money went into something other than education, healthcare, and infrastructure.

Of course arguments like these won’t stop the most ardent Kremlin supporters. Point all of that out and they’ll just tell you that it was worse in the 90’s, or they’ll just choose some country with bigger problems and proclaim it to be the standard by which to measure nations. But they can only do that for so long. The latter argument is worthless and the former will be worthless as more standard of living indicators in Russia continue to sink back toward their 1990’s levels. In any case, I still can’t help reacting the same way whenever I hear these defenses. If you’re so right, if you know so much more, why isn’t Russia leading the world? Why isn’t it anywhere close to doing so? Why has Russia been performing far below its obvious potential? These are the questions we must ask, and while the simple answer isn’t necessarily Putin, as in Putin the man, it does have everything to do with the Putinist system.

UPDATE: Putin’s press secretary and over-half-million-dollar-watch-owner-whose daughter-prefers-living-in-Paris Dmitry Peskov has now claimed that the Panama Papers investigation was aimed directly at Russia, and specifically at Putin personally, even though it clearly wasn’t.  Acting a little guilty there, Dmitry! Maybe you can use your watch’s time travel feature to go back a few minutes into the past and stop yourself from making those idiotic claims. Please tell me it has time travel. For $620,000 it had better have time travel capability!

20 thoughts on “Where there’s smoke…

  1. gbd_crwx

    Well, did you notice the fire?

    And if this firm is the 4th biggest in their trade, is it possible that the Russian lites have put their egggs in more than one basket, you think?

  2. AndyT

    And now many conspiracy theorists are yelling:

    “YOU SEEEEE! They’re trying to smear Putin and Assad! It’s a ‘Murican plot!”

    Well, while some media outlets may be eager to hit rival leaders, I can hardly see Argentina’s President, Iceland’s PM and David Cameron’s father as dangerous anti-Western politicians…

    1. Jim Kovpak Post author

      Yes, and yet for some reason, the stupid conspiracy theorists implicated their “puppet” leader in Ukraine in their totally fabricated investigation.

      Like in all conspiracy theories, the conspirators are always super-geniuses and total morons.

      1. Anonymous Expat

        There is actually a way too make that work, since the stuff on Poroshenko is kinda weak[1] — setup of some offshores, but seemingly not actually doing anything with it. So clearly, the strategy is to make a token claim against their not-too-important puppet that won’t make much of a difference anyway, in order to look balanced. Ditto for going after Cameron’s dad.

        [1] Which possibly has much to do with those involved in “investigating” the Ukrainian portion preferring to substitute zrada-editorializing in place of actual investigation. Whatever happened to splitting editorial and reporting functions anyway…?

      2. AndyT

        On a “brighter” side, they can keep complaining about Western media’s denial about Palmyra and Homs – it looks like they don’t know we have Twitter and the like…

    2. sglover

      You should see the comment section of the “Irrussianality” blog, a site that I like very much. Jesus, **I** think there’s a lot of overheated and weird Russophobia in western media, but the assholes making most of the comments there seem to think that **any** questioning of Dear Leader is a heinous, centrally directed attack. And they wave away any suggestion that this is just an initial glimpse of a vast data trove. I think the Panama Papers are going to be inspiring headlines monthly, if not weekly, for the next year at least.

      Who can really be surprised that an examination of Putin’s wealth might yield some, er, **interesting** structures?

      1. Jim Kovpak Post author

        Oh that guy’s a riot. He tried to write a “response” to one of my articles and in it, he completely missed the point I was making.

        Also he’s another one of these Putin admirers who refuses to live under the wise guidance of the Dear Leader, so as to experience the brilliance of his leadership first hand. No, he prefers fascist, decaying Canada. Canada’s standards of living are much lower than Russia’s, right?

        I’ve said it before- if you support Putin, you really ought to move to Russia and try to live as closely as possible to an ordinary Russian. You have the luxury of being able to live in a state where the entire media basically agrees with you, and where those who disagree are hounded, marginalized, and harassed. Like Graham Phillips, you can even harass them at will because you know the state is on your side. It must be paradise.

        I don’t have that luxury. I move to the US and I’m surrounded by enemies. In Ukraine the same thing.

        But for Putinists, you have a Putinist state. So go there while they’re still willing to toss cash at any foreign traitor that’s willing to cowardly attack their government from abroad.

  3. Alex Podell

    For me (and probably most readers) the real story is about David Cameron’s father.

    Everyone expects Russian politicians to be be dirty and crooked. But Cameron’s Dad had this business offshore and never disclosed it to the UK.

    Now his son has some explaining to do – of course he knew about this bs.

  4. jonathan

    The juxtaposition between the reaction in Russia and the likes of Iceland to these revelations is fascinating. It is really quite incredible that the Russian elite have still come up with nothing other than “it is CIA inspired anti-Russian information attack that is not worth even responding to, but hey! look what Poroshenko has been doing!!”

    RT has been hard at it. Regurgitating Peskov quotes that its not worth reacting to whilst simultaneous gleefully publishing articles about the sheer scale of UK links to offshore companies.

    I love this on RIA (taken from Peskov again, I think):
    Кремль разочарован качеством этого расследования, поскольку ожидал более квалифицированной работы, и считает опубликованную информацию спекуляциями.


  5. DM

    > If you’re so right, if you know so much more, why isn’t Russia leading the world? Why isn’t it anywhere close to doing so? Why has Russia been performing far below its obvious potential?

    Well, to this question a typical Russian would answer that it is because the West always undermines Russian progress, they holding it back. They even manage to accuse the West of creating USSR, while at the same time they accuse the West of ruining USSR. Russian “logic” is notorious.

      1. Asehpe

        To which they would say: ‘because Western secret services are composed of super-genius morons.’ 🙂

        I wonder what is “really” going on in the minds of Russians. At some level I suppose at least some of them realize that this whole thing cannot be just a complicated anti-Russian operation… but what then?…

      2. gbd_crwx

        How do you mean, Jim? Something like: “They might be bastards, but they’re our bastards” ?

  6. Pingback: The Fallout | Russia Without BS

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