The War in Ukraine, Ill-Begotten Gains, and What’s the Difference Between Russian Oligarchs and America’s One Percent?`
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For those of us who gave up long ago of their being change in the world, resigned from the notion of their being any revolutionary impulses in society, let alone real revolution, the excitement around the developments in the war in Ukraine, the mood shift in the global polity around income inequality and authoritarianism is palpable. In Ukraine’s President Volodymyr Zelenskyy we’ve been presented with a figure who is equal parts George Washington, Che Guevara, and Jon Stewart.
And now the world seems on the verge of something new.
Last night during the State of the Union, President Biden said of President Vladmir Putin and his Russian oligarch cronies: ”
“Tonight, I say to the Russian oligarchs and corrupt leaders who have bilked billions of dollars off this violent regime: no more,” he said. “The US Department of Justice is assembling a dedicated task force to go after the crimes of Russian oligarchs.”
Biden then detailed what these actions would mean for the oligarchs themselves.
“We are joining with our European allies to find and seize your yachts your luxury apartments your private jets,” he said. “We are coming for your ill-begotten gains!”
President Biden: “Tonight I say to the Russian oligarchs and the corrupt leaders who built billions of dollars off this violent regime, no more. […] Tonight I’m announcing that we will join our allies in closing off American air space to all Russian flights.” pic.twitter.com/L4S3izFYJD
— The Hill (@thehill) March 2, 2022
Today, CNBC reported:
The Biden administration announced a new task force Wednesday that will enforce sweeping U.S. and allied sanctions imposed on Russian officials and oligarchs that have helped finance President Vladimir Putin’s unprovoked war in Ukraine.The new task force, comprised of interagency law enforcement officers from the FBI, Marshals Service, IRS, Postal Inspection, Homeland Security Investigations and Secret Service, will target “the crimes of Russian officials, government-aligned elites, and those who aid or conceal their unlawful conduct.”
The Impossible Suddenly Became Possible
This morning The Atlantic said, “When Russia invaded Ukraine, the West’s assumptions about the world became unsustainable.”
Volodymyr Zelensky’s courage has moved people, even the hard-bitten CEOs of oil companies, even dull diplomats accustomed to rote pronouncements. Vladimir Putin’s paranoid ranting, meanwhile, has frightened even people who were lauding his “savvy” just a few days ago. He is not, in fact, someone you can do business with, as so many in Berlin, Paris, London, and Washington falsely believed; he is a cold-blooded dictator happy to murder hundreds of thousands of neighbors and impoverish his nation, if that’s what it takes to remain in power. However the war ends—and many scenarios are still imaginable—we already live in a world with fewer illusions.
@kristy5022 #duet with @cbsnews #presidentzelensky #ukraine #russia ♬ original sound – cbsnews
What is the difference between a Russian Oligarch and what Bernie Sanders refers to as the one percent?
During the 2020 presidential campaign Bernie Sanders talked about the one percent or billionaire class or oligarchs interchangeably. The term one percent entered popular rhetoric in the United States following the 2008 financial collapse and the subsequent Occupy Wall Street “movement.”
In 2019 the New York Times Paul Krugman wrote in an Op-Ed:
The catchphrase “the 1 Percent” has also become a problem, obscuring the nature of class in 21st-century America.
Focusing on the top percentile of the income distribution was originally intended as a corrective to the comforting but false notion that growing inequality was mainly about a rising payoff to education. The reality is that over the past few decades the typical college graduate has seen only modest gains, with the big money going to a small group at the top. Talking about “the 1 Percent” was shorthand for acknowledging this reality, and tying that reality to readily available data.
True, there’s a huge difference between being affluent enough that you don’t have to worry much about money and living with the financial insecurity that afflicts many Americans who consider themselves middle class. According to the Federal Reserve, 40 percent of U.S. adults don’t have enough cash to meet a $400 emergency expense; a much larger number of Americans would be severely strained by the kinds of costs that routinely arise when, say, illness strikes, even for those who have health insurance.
So if you have an income high enough that you can easily afford health care and good housing, have plenty of liquid assets and find it hard to imagine ever needing food stamps, you’re part of a privileged minority.
But there’s also a big difference between being affluent, even very affluent, and having the kind of wealth that puts you in a completely separate social universe. It’s a difference summed up three decades ago in the movie “Wall Street,” when Gordon Gekko mocks the limited ambitions of someone who just wants to be “a $400,000-a-year working Wall Street stiff flying first class and being comfortable.”
One survey found that Americans, on average, think that corporate C.E.O.s are paid about 30 times as much as ordinary workers, which hasn’t been true since the 1970s. These days the ratio is more like 300 to 1.
Why should we care about the very rich? It’s not about envy, it’s about oligarchy.
With great wealth comes both great power and a separation from the concerns of ordinary citizens. What the very rich want, they often get; but what they want is often harmful to the rest of the nation. There are some public-spirited billionaires, some very wealthy liberals. But they aren’t typical of their class.’
The very rich don’t need Medicare or Social Security; they don’t use public education or public transit; they may not even be that reliant on public roads (there are helicopters, after all). Meanwhile, they don’t want to pay taxes.
Sure enough, and contrary to popular belief, billionaires mostly (although often stealthily) wield their political power on behalf of tax cuts at the top, a weaker safety net and deregulation. And financial support from the very rich is the most important force sustaining the extremist right-wing politics that now dominates the Republican Party.
That’s why it’s important to understand who we mean when we talk about the very rich. It’s not doctors, lawyers or, yes, authors, some of whom make it into “the 1 Percent.” It’s a much more rarefied social stratum.
The class divide that lies at the root of our political polarization is much starker, much more extreme than most people seem to realize.
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Let’s start with the Oxford English Dictionary. The OED is the dictionary for dictionaries. According to the OED, the definition of oligarch is:
Any form of government in which there is ‘rule by a few’; for example, by members of a self-regulating elite having domination over a larger society.
Ok. Let’s see what we get for one percent. The OED doesn’t have a definition. However, the Cambridge Dictionary says:
Well, what’s the difference between the Oxford English and the Cambridge Dictionaries? According to Checked Inn:
When it comes to definitions, Cambridge and Oxford take fairly different approaches. While the Oxford English Dictionary gives you the meaning of the word as well as its origin, the Cambridge Dictionary gives a more practical explanation along with an example of how to use the word in a sentence. This can make the Cambridge dictionary a good resource for those learning English, as well as for those who want to increase their practical vocabulary.
Interesting. Ok, maybe I’m being impractical. From an April 2018 story by Christopher Lizza’s The Point on CNN:
The Trump administration announced new sanctions against seven Russian oligarchs with ties to President Vladimir Putin and 12 companies they own or control on Friday.
CNN reported Wednesday that special counsel Robert Mueller, who is charged with investigating Russian election meddling, had questioned three Russian oligarchs, all of whom were unnamed in the report.
What’s Mueller looking at?
From the CNN report: One area under scrutiny, sources say, is investments Russians made in companies or think tanks that have political action committees that donated to the campaign.
Another theory Mueller’s office is pursuing, sources said, is whether wealthy Russians used straw donors – Americans with citizenship – as a vessel through which they could pump money into the campaign and inauguration fund.
Back then they also said:
In short, Americans are being introduced to this small universe of Russian oligarchs but a lot of people probably don’t understand what exactly an oligarch is.
The Kremlin, for its part, says there are no more oligarchs.
“The phrase ‘Russian oligarchs’ is considered inappropriate,” Kremlin spokesman Dmitry Peskov told reporters recently. “The time when there were oligarchs in Russia passed long ago, there are no oligarchs in Russia.”
Lizza continues:
To clear all of this up, we went in search of an oligarch expert and found Thomas Graham. According to his bio, Graham is co-director of the Russian studies program at Yale, a managing director at Kissinger Associates Inc. – where he focuses on Russian and Eurasian affairs – and was special assistant to the president and senior director for Russia on the National Security Council staff during the administration of George W. Bush.
What’s an oligarch?
We first asked what, to him, is the definition of “oligarch.”
“Oligarchs are rich Russian businessmen who are close to the seat of power in Russia,” he said, adding that “almost any rich Russian businessman is an oligarch, because in Russia there is a close relationship between private wealth and public power.”
Above: The Kremlin, Moscow, Russia. Photo by Michael Parulava on Unsplash
Where did oligarchs come from?
He said the way most rich Russians get rich is by having connections in government and working them. But it wasn’t always this way. We are on generation two, at least, of Russian oligarchs.
“The term was first used in the mid-’90s after the breakup of the Soviet Union,” Graham said. “A time of great socioeconomic stress and a time when the instruments of state power were breaking down. It was also a period when you were going through the great process of privatization.”
Out of this ooze of change from communism to semi-capitalism rose the oligarchs, a small number of individuals who used their political power to gain control over private assets. We’re talking about the Russian oil and gas industry, the timber and aluminum industries and industries around other natural resources.
“A typical oligarchic group would have some person in a high state position,” he said. “It would have media resources. And it would have security resources.”
Some of the more notable early oligarchs were people like former former media mogul Vladimir Gusinsky and Mikhail Khodorkovsky, who was at that time one of Russia’s richest men because he headed the oil company Yukos.
In that in-between period, the oligarchs got rich and powerful, but Graham said their relationship with the government began to change when President Vladimir Putin came to power.
Above: Vladimir Putin, then the prime minister of Russia, speaks with Oleg Deripaska at the International Investment Forum in Sochi, Russia, in 2008. Ilia Pitalev / AFP via Getty Images file
Are rich Americans in politics oligarchs?
What’s the difference between a Russian oligarch and an American billionaire? There are plenty of billionaires in the US who wield incredible political power. Michael Bloomberg, anyone? Donald Trump? And even those not directly in politics can have political power. The Koch brothers leap to mind.
But it’s not the same as in Russia, said Graham.
“The difference in our country is we have institutions,” he said. “We have independent court systems. You can try to influence policy, but you don’t have to have access to the political power to protect your property.”
“You can be a rich businessman in the US and not worry about your contacts in government. It’s a little bit different in Russia; each business decision you make, you have to be checking with your contacts in the Kremlin. The government can strip you of your oligarch status.”
“The problem you have is that a businessman in Russia has to operate in a different way than a businessman in the US because you don’t have a reliable legal system,” Graham said. “Your ability to maintain your hold on property is reliant on your ability to maintain relations with the government.”
One man on the Oligarch “hit list” seems to be more significant than the others is Roman Abramovich. Abramovich is apparently Putin’s financial advisor.
Above:Roman Abramovich BEN STANSALL/AFP via Getty Images
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In the House of Commons, Davis named Roman Abramovich, the Russian billionaire with property in London, saying “according to the Spanish national intelligence committee, he is one of the men who manages Putin’s business affairs. That is a really important issue about whether he should be on our target list.”
Abramovich, the Russian billionaire who recently passed stewardship of Chelsea FC to a charitable foundation, has vehemently disputed reports alleging he is close to Putin or that he has done anything to merit sanctions.
Bob Seely, a Tory MP and member of the foreign affairs committee, said oligarchs needed to be under the spotlight as they were “not just obscenely rich people who are mates with someone” but part of the Kremlin’s “structure of control and power whether it is in east Ukraine or in the UK”.
A day after Russian missiles destroyed the Holocaust museum in Kyiv, Ukraine, Abramovich has been asked by Ukraine to sit at the negotiation table in peace talks with Russia, the billionaire is one of the few people on good terms with both sides of the war. But that is not enough to get him out of sanctions, so Yad Vashem, the head of Israeli’s Holocaust memorial and museum, is petitioning the U.S. government to give him a pass, according to The Washington Post.
Quoting a letter to U.S. Ambassador Tom Nides, Yad Vashem and a number of high-ranking Israelis have officially asked the U.S. government to exclude Abramovich from their sanctions, warning that not doing so could be harmful to Jewish institutions that need his money. Abramovich recently donated an “eight-figure” sum to bolster research projects and commission two new editions of the Book of Names that will be overseen by Yad Vashem’s museum.
Abramovich became a dual Israeli citizen in 2018, shortly after he was turned down for a U.K. passport during heightened tensions with the Kremlin after the nerve-agent poisoning of ex KGB officer Sergei Skripal and his daughter by Russian agents.
Abramovich, clearly concerned about the sting of sanctions, is said to be conducting a fire sale of his British assets, including a $260 million London property empire and his multibillion-dollar stake in the Chelsea football club, fearing his assets will be frozen by British lawmakers.
As a final note, he said the money from the sale will be donated to a new fund he is setting up. “The foundation will be for the benefit of all victims of the war in Ukraine,” he wrote, without mentioning his best pal Putin or Russia actually leading the war effort. “This includes providing critical funds towards the urgent and immediate needs of victims, as well as supporting the long-term work of recovery.”
On Wednesday, he released a statement on the team website confirming rumors that the club was now for sale. “In the current situation, I have therefore taken the decision to sell the Club, as I believe this is in the best interest of the Club, the fans, the employees, as well as the Club’s sponsors and partners.” Never mind that keeping it in his wheelhouse would have surely seen it shuttered under the strict sanctions set forth by the British government against oligarchs. He went on to say the sale of the club would “not be fast-tracked but will follow due process.” While no buyer has been named, he wrote, “I will not be asking for any loans to be repaid. This has never been about business nor money for me, but about pure passion for the game and Club.”
Above: Oleg Deripaska
Another Russian oligarch not sanctioned by the UK is Oleg Deripaska, who has been on the US sanctions list since 2018 over his alleged links to the Russian government, which he has taken legal action to challenge.
This week, Deripaska called for peace talks to begin “as fast as possible” in a post on the messaging app Telegram. “Peace is very important,” wrote Deripaska, who founded the Russian aluminium giant Rusal, in which he still owns a stake through shares in its London-listed parent company EN+ Group.
The FBI raided his home in Washington,D.C. last October. According to NBC News:
A spokeswoman for Deripaska, a billionaire oil tycoon who was placed under U.S. sanctions three years ago, said the FBI also searched a home in New York City. She said both properties belong to Deripaska’s relatives.
“The searches are being carried out on the basis of two court orders, connected to U.S. sanctions,” the spokeswoman said. “The houses do not belong to Mr Deripaska.”
Lawyers for Deripaska did not immediately return requests for comment. Asked about the spokeswoman’s claim that the investigation is tied to sanctions, the FBI spokesperson declined to comment.
Oligarchs speak out against Russia.
Two of Russia’s most powerful oligarchs are speaking out against their own country’s war in Ukraine.
Oleg Deripaska, a billionaire Russian metals tycoon and longtime Putin ally who has been sanctioned by the U.S., took to Telegram on Sunday to declare: “Peace is very important! Negotiations must begin as quickly as possible!”
Banking billionaire Mikhail Fridman wrote a letter to his staff on Friday describing the war as a “tragedy,” and calling for an end to the fighting, according to media reports.
Their statements represent rare acts of public dissent against Russian President Vladimir Putin’s leadership in foreign affairs by the country’s super-rich elite, whose fortunes depend on staying in Kremlin’s good graces.
“While a solution seems frighteningly far off, I can only join those whose fervent desire is for the bloodshed to end,” Fridman wrote, according to the UK’s FT newspaper. “I’m sure my partners share my view.”
This pushback from top oligarchs is just the latest sign of a widening fissure among the Russian public over Putin’s war, which began earlier this week with missile strikes and armored vehicle assaults against targets throughout Ukraine. Russian authorities have detained some 5,700 people in 48 cities for participating in anti-war protests, according to a protest-monitoring group called OVD-Info.
Fridman has gone further and using his Ukrainian identity to do so:
“I was born in Western Ukraine and lived there until I was 17. My parents are Ukrainian citizens and live in Lviv, my favorite city. But I have also spent much of my life as a citizen of Russia, building and growing businesses. I am deeply attached to Ukrainian and Russian peoples and see the current conflict as a tragedy for them both. I do not make political statements, I am a businessman with responsibilities to my many thousands of employees in Russia and Ukraine. I am convinced however that war can never be the answer. This crisis will cost lives and damage two nations who have been brothers for hundreds of years.”
Deripaska, who is a longtime associate of former Trump campaign chairman Paul Manafort, was among two dozen Russian oligarchs and officials who were sanctioned by the Treasury Department in April 2018. A news release announcing the sanctions said Deripaska has been investigated for money laundering and accused of “threatening the lives of business rivals, illegally wiretapping a government official, and taking part in extortion and racketeering.”
The U.S. Treasury Department levied sanctions on Deripaska and some of his companies, including aluminum producer Rusal, in 2018. Sanctions against those companies were later lifted under former President Trump after Deripaska agreed to reduce his ownership stake. But Deripaska lost his lawsuit against the Treasury Department to get his own name off the sanctions list in 2021.
GayNrd’s Arts and Technology Editor says:
The Russian Oligarchs are basically a group of incredibly wealthy individuals who were able to navigate the collapse of the USSR and accumulated billions by cutting deals for control of former state assets, usually heavy industry. The goal of these deals was to minimize challenges to Russian political authority in exchange for financial gain. Who they are ranges from former regional governors and high-ranking Soviet party officials to organized crime figures… really anyone who threatened stability in the collapsing USSR due their ability to cause street-level guerilla chaos. Because of these deals of appeasement, they, and their inner-circles and heirs, still hold defacto monopolies in numerous industries. Although Putin has supreme control of Russia, the oligarchs, collectively, are arguably the only group with any actual political leverage over Putin.
Above: i am legally hype breaks down the State of the Union and the latest developments in Ukraine.
But I asked him, hasn’t Zelenskyy himself been backed by a Ukrainian oligarch benefactor? What does that mean?
Dreyer:
In the US, the power of the one percent is a frustrating wildcard that balances its own interests in opposition to both the government and the voting public. The one percent seek to influence policy through financing the campaigns of the thousands of state and federal lawmakers that comprise the fabric of American policy power. Additionally, they support media ecosystems that can favor their positions. However, the voting public and lawmakers have the final say, creating the private / public tension at the heart of most Western democracies. Russia, however, is a state run from the idea of power consolidation. The public doesn’t factor as a major power and the markets oligarchs control are protected from competition. The oligarchs derive their power from Putin and Putin can strip them of that power. This can work to silence dissent on the scale of one or a handful of objectors, but if the majority of oligarchs challenged Putin on a unified front he would potentially face the collapse of his regime. However, if they were successful in ousting Putin the immediate global crisis might end, but a coup conducted by people as rich as they are ruthless probably wouldn’t solve Russia’s long-term problems.
Above: Jack Sweeney
Following the State of the Union last night, 19 year-old Jack Sweeney, who started the Russian Oligarch Jets Twitter account said: “I stand with Ukraine and will support efforts to go after the Russian oligarchs, them, and their assets as Biden has just said at his SOTU address.”
I stand with Ukraine and will support efforts to go after the Russian oligarchs, them, and their assets as Biden has just said at his SOTU address.
— Russian Oligarch Jets (@RUOligarchJets) March 2, 2022
It all seems to good to be true.
But my position on this, like the war, like world governments, is changing rapidly, minute to minute. The way everything moves in the world is coming into focus.
Let’s see what what happens.
