In the war against Ukraine there is one weapon more frightening than anything in the entire Russian arsenal. Sneakier than “hybrid warfare,” it is a weapon which is designed to be wielded by the Ukrainian people against themselves, and it helps the Putin regime both maintain influence in Ukraine while sustaining itself at home. That weapon is neo-liberal economic theory, and as Sean Guillory points out in this superb article, Ukrainians ought to think twice about heeding the advice of neo-liberal bad Samaritans, in this case Arthur Laffer.
There is an idea among some Ukrainians and Ukraine supporters that Russia is the biggest threat to Ukraine and the be-all, end-all when it comes to survival or defeat of Ukraine as a country. This is woefully incorrect. For one thing, Russia has managed to keep its thumb on Ukraine for so long largely due to the poverty and other effects of the collapse of the Soviet Union. When Russia’s economy soared in the mid-2000’s, plenty of Ukrainian citizens, mainly from the east, could look to Russia and see higher salaries and pensions, so that as one refugee from Donetsk told me, some locals thought annexation by Russia would bring “paradise.” It matters not whether they were wrong because the Russian system wasn’t sustainable, or if those economic benefits came at the cost of losing political freedoms. Poor people with few prospects are likely to embrace any system or regime that appears to be able to reliably put food on the table, and in the case of Russia, put iPhones in pockets.
Hanging out in Kyiv, and particularly in the center, it was always easy to miss the economic reality that faces Ukraine, especially now. It’s obvious when you go out to some place like Donetsk oblast, but in the capital it’s far more subtle. One clue is the increased presence of homeless people and people asking for money in and around Maidan Nezalezhnosti. In my most recent trip this was impossible to ignore. But there were other signs as well.
I don’t mean to sound like Thomas Friedman here, but on my last trip I had a long discussion about the local economy with a cab driver who drove me into the city from the Boryspil airport. The story is the same- lack of work, low wages, etc. I met another expat who explained to me how his friends in Odessa were now living on or below the poverty line. Now I don’t mean to level any accusations against any specific people, but this kind of poverty and desperation is vital for Russia to maintain control over Ukraine by other means. Just as how the Russian government can easily stifle dissent by paying people to support the government in public or harass dissidents, desperate people in Ukraine are a pool of cheap, willing agents for sabotaging progress. If one thinks that some sense of patriotism will keep these people from carrying out the work of the Kremlin, think again. For one, the Kremlin’s motives are not always obvious, nor do they always seem logical from the outside. The origins of the money used to pay these “agents” may be murky, if not totally obscure. Putin’s designs might be carried out by men claiming to be Ukrainian patriots. In fact, bet on it. Patriotism is the last refuge of a scoundrel, after all.
Getting back to the economy, this is yet another reason why people should be more up in arms about the decommunization law. Proponents of this law essentially preach a sort of voodoo politics, whereby removing symbols and in some cases rewriting history will suddenly make all Ukrainians into patriotic citizens. Patriotic citizens, who, for example, will be less likely to resist in the face of coming austerity. You see, if trade unions and workers band together to protest austerity for them while the rich continue to live in luxury, the oligarch-controlled media can just tar them as Communists or Communist-like. They’ll be accused of wanting a return to the Soviet Union and Moscow rule. A good Ukrainian patriot endures the inequality and poverty, and in return gets flags, slogans, and fairy tales about “national ideas.” Same as the Russian patriot, incidentally.
Does that sound far-fetched? Well it’s already happened in America of all places. Nearly a quarter of a century after the fall of the USSR, America’s Republicans and conservatives have been screaming about Communism, socialism, and Marxism more loudly than ever, lobbing this accusation against a neutered Democratic party which long ago went full-on neo-liberal. Even during the Cold War they were less shrill than they have been since the election of Barack Obama. Take a look at this GOP poster from 1956, for example. That’s a Republican pro-labor union poster. These days the GOP portrays unions as at best, shiftless and lazy, and at worst, “thugs.” If, in America, the idea of requiring private citizens to buy health insurance from private providers can be repeatedly labeled “socialist” or “Communist,” it stands to reason that any significant push back against austerity in Ukraine will inevitably be similarly tarred with the same labels. I guarantee it.
To the people of Ukraine I will make this as blunt as possible. Not everyone in Ukraine is “Ukrainian”, which is to say you are not on the same side. It is not only the top oligarchs you have to suspect either. This has nothing to do with their nationality, their religion, what language they speak, or their sexual orientation, but rather their relation to the means of production and their ownership of capital. These people’s interests are irreconcilable to those of the vast majority of Ukrainian citizens, and they are veryreconcilable to those interests of their business counterparts in Russia. Some of them are having a spat at the moment, and their are some minor differences concerning Russia’s neo-feudal incarnation of capitalism, but capitalists are capitalists.
As these people continue to squeeze you more and more, they will crow more and more loudly about the horrors of “Communism,” and shed mighty rivers of tears for people who died decades ago. They will do this because mourning the dead costs them nothing, whereas actually caring about the Ukrainian people today, and those yet unborn, does cost them. Make no mistake- Ukraine is not a poor country. It possesses the land and resources to provide for the basic needs of every citizen and ensure a positive birth rate as well. Russia is even more endowed with such resources. But what Ukraine cannot do is provide that lifestyle for its citizens while simultaneously providing a life of opulent luxury for a small minority who are unwilling to earn by their own labor, and who use the political system and its monopoly on violence to maintain a system that denies people the means to obtain the necessities of life save for at the mercy of a capitalist.
Those in Ukraine who exploit their fellow Ukrainians have an incentive to keep people’s minds focused on the past and not present, and the effects of this distraction are extremely useful to the Kremlin as well. More equality means a stronger, more inclusive community, and that means a much smaller pool of potential agents for the Kremlin. By contrast, post-Maidan Ukraine’s circus of populism, far-right politics, and patriotic circle-jerks give Putin’s political technologists and intelligence operatives little reason to worry about losing influence in Ukraine.
Finally, it is high time to chuck the politics of opposites, whereby people in Ukraine and other Eastern European countries enthusiastically embrace anything that appears to be the opposite of what they think their enemies represent. Bad Samaritans like Arthur Laffer may seem like the polar opposite of the Kremlin, which presides over a much more restricted capitalist system. Do not be fooled, however. The Kremlin system is capitalist through and through, and what is more it is a system that thrived off of the 90’s and 2000’s amoral neo-liberal, let-the-market-decide mentality. The crisis of 2008 showed much of the West that the capitalist system is inherently flawed and cannot be fixed. Today, there are even progressive capitalists who envision an alternative system, that some are referring to as post-capitalism. There are many flaws in their vision, but they are onto something. With the rest of the modern world waking up to this reality, there is no good reason for Ukraine to listen to outdated dinosaurs like Arthur Laffer and the rest of the neo-liberal cultists.
Alright, I’m stepping down from my soapbox. As a related note though, I think Ukraine can take inspiration from another country that emerged in the 20th century after centuries of domination. I leave you with a key passage from Ireland’s Democratic Programme of the First Dail and a simple question:
“…we declare that the Nation’s sovereignty extends not only to all men and women of the Nation, but to all its material possessions, the Nation’s soil and all its resources, all the wealth and all the wealth-producing processes within the Nation, and with him we reaffirm that all right to private property must be subordinated to the public right and welfare.”
So, people of Ukraine, to whom do your nation’s soil, resources, and wealth producing processes belong to?
*The title of this post is inspired by one of the books of South Korean economist Ha Joon Chang, which can be found here.
If you need Loan, project funding, Bank Guarantee, SBLC, DLC or Letters of Credit please contact us immediately.
Brokers are paid good commission on each successful transaction so if you want to work for our company as a broker, agent or mandate please contact us for more information.