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Joint Onslaught by US and Russian Oligarchs

Belarus Under Siege

by MICH?LE BRAND

On June 29 and 30, US Secretary of State Hillary Clinton was in Vilnius, Lithuania to participate in a meeting of the “Community of Democracies” and to visit one of the many US-funded international “tech camps.” These camps host “civil society” (i.e.opposition) activists from various nations whose governments the US doesn’t appreciate, and teach them internet and social network organizing skills to be used toward fostering, in official words, “democratic transition,” or more correctly, color revolutions and regime change. According to the AP, “Much of the democracy meeting’s opening day dealt with the new mechanics of protest, such as social media networks.” During her visit Clinton stated that “The United States has invested $50 million in supporting internet freedom and we’ve trained more than 5,000 activists worldwide.” This is of course in addition to the hundreds of millions that the US spends in other ways attempting to destabilize its enemies and to force “democratic transitions.”

The choice of Vilnius was not by chance: it lies 30 kilometers from the Belarusian border. This tech camp is hosting 85 activists from the region, “primarily from Belarus.” Belarus is currently being targeted by a concerted effort towards an orange revolution, financed and remote-controlled by the West. Simultaneously, the country is being subjected to a relatively new pressure from the East: certain Russian elements have apparently decided that Belarus and its profitable state-owned enterprises should belong to them, and are contributing in their own way to the effort to destabilize the government.

I’ve just returned to Paris from a second extended trip to Belarus. Western media faithfully relay the monstrous picture of Belarus that our governments want to convey, and so I’d like to report on the situation in this little-known country, and encourage others to visit it in order to experience for themselves the Belarusian culture, economy, hospitality and character. Among other visits I attended an international conference on the resistance to Nazi fascism, in Brest on June 22, the 70th anniversary of the Nazi invasion of the Soviet Union. In a country which lost between a third and a quarter of its population during the war, the memory of the ravages of foreign attacks and the heroism of those who resisted it is very strong and alive. Located dangerously between Europe and Russia, entirely flat and endowed with few natural resources, Belarus has fought hard to build a successful independent state. It is not inclined to lose its sovereignty now.

The United States and other Western countries have been attacking the government of President Alexander Lukashenko ever since it refused to follow the path of the other ex-Soviet countries in the 1990s, which famously sold off the state-owned industries to oligarchs, destroyed the social protection system and allowed kleptocratic mafia capitalism to take over. Under Lukashenko, Belarus has developped gradually into a strong socially-oriented market economy with the highest growth rate in the CIS even during its current financial troubles (according to the CIS Interstate Statistical Committee, between January and April 2011 Belarusian industry grew 12.9% year-on-year), while still maintaining its free health care, job protection, social services, retirement programs, low unemployment, state-subsidized housing and utilities, and high level of education. This is one reason why the country is naturally in the line of fire of the West, whose bankrupt governments are now obsessively telling their citizens that “there is no alternative”: we must drastically decrease or kill pensions and other social programs, fire government employees, flexibilize the work force, privatize education, health care, infrastructure and everything possible, etc. etc. Located just next door to crisis-stricken Europe, Belarus is more than a thorn in its side; it is living proof that European and American neoliberal propaganda is only lies.

This seems to be one reason that the attacks against the Belarusian economic model and its government have recently gone into higher gear. Its economy is an isolated pocket of export-oriented production next to the Western economies of consumption. Belarus was the most highly industrialized area in the Soviet Union, manufacturing machines, petroleum and chemical products for the whole Soviet sphere and receiving its energy and raw materials from the East. 75% of the economy is exports; 80% is state-owned production, and there are many public-private partnerships. Smaller businesses are mainly private. The country has recently benefitted from a good deal of foreign investment, for example from China, which has invested in infrastructure projects and with whom Belarus has a unique commercial credit swap program. GDP grew 7.6% in 2010. Signs of growth are to be seen everywhere, much more so than during my first visit to the country two years ago, and the skyline of Minsk is dotted with cranes.

The first impression one has of Belarus is how clean it is — there’s hardly a cigarette butt on the street — and the second is the immense number of trees and parks in the cities. (The third might be, depending on whether one had presuppositions about the country being a late Soviet backwater, the modern cars, cell phones and cosmopolitan way of life of its citizens.) Belarusian cuisine is healthy and delicious; agricultural products are local, low-chemical and inexpensive. The food distribution system is not parasited by rapacious large private distributors. The tomatoes are actually red inside and have a real tomato flavor, not whitish inside and tasteless like in the West. The country’s Gini coefficient, measuring income equality, is excellent (29.7, much better than France or the US, or its neighbors Russia and Poland). The country is attracting immigrants from other CIS states who are fleeing their countries’ corruption, crime and drugs in favor of Belarus’ low crime, low unemployment, social services, clean streets and green cities.

These are some of the reasons that the government of President Lukashenko is genuinely popular among the majority of Belarusians, who naturally compare their society’s development over 20 years to that of their neighbors. And it is this popularity that poses a problem for the West and its desire for “democratic” regime change.

Western governments claim that the presidential election of last December 19 was fraudulent, and use this to justify their recent round of attacks. I have spoken with a number of international observers of that election who affirm that they saw no fraud or irregularities, and exit polls confirmed that the majority of Belarusians voted to reelect President Lukashenko. One such report can be read on Counterpunch. The CIS observers reported that they had witnessed a fair election, while the OSCE, predictably, stated the opposite. The selective coverage of this election in Western media is astounding, and to understand the events I recommend this short documentary: “Ploshcha: Beating Glass with Iron” .

For about a month before the election the major opposition candidates were spending more time calling on their supporters to protest in a central square in Minsk on the evening of the election, than on campaigning in a normal way by outlining their policies and calling on people to vote. On the evening of the election at around 7:00, before voting stations had closed and well before the results were announced, the opposition groups rallied in October Square in Minsk, the traditional place for demonstrations, flying the blue European flag and the red and white former Belarusian flag, symbol of the opposition. Then the presidential candidates called on their supporters to head to the central government building “and ask them to vacate the offices,” and led a crowd of around 7,000 to Independence Square, just in front of the Parliament. It should be said in passing that out of 1.3 million voters in Minsk, this is a small number. Opposition candidates proceded to announce that they contested the election results and to proclaim they were forming a new government, the “government of rescue,” reading a printed statement clearly prepared in advance, before results were announced. The police did not interfere with the rally until a large group of well-prepared individuals forcibly tried to enter the Parliament building, using metal rods and shovels. It could have been worse: in the weeks before the election, Belarusian border authorities had seized a number of cargoes of metal rods, grenades, knives, guns, and explosives. The police intervened and prevented what was clearly an attempt at a coup d’?tat, following the pattern used in the “tulip revolution” in Kyrgyzstan in 2005. Opposition representatives later claimed that the attack on the Parliament was done by government provocateurs, but many of those arrested and / or filmed trying to break into the Parliament were identified as having relations with various opposition groups.

The goal was apparently twofold: either seize power by occupying the buildings, or if not, at least get international media footage of combat between police and protesters, preferably with blood. Though there were no major injuries, the second goal was obtained since now Western governments and media call this a “violent crackdown” on an opposition rally, and accuse the government of breaching human rights. The hypocrisy of the West, who (with Russia) paid for the campaigns of much of the Belarusian opposition, and who try to foster a “democratic” transition by violently overturning a democratic electoral process, is extraordinary. As Counterpunch readers know well, the US has no lessons to give on human rights. I have directly experienced the way in which the US police protect the human rights of non-violent protesters, for example on April 16, 2000 in front of the Treasury building in Washington, when riot cops violently dispersed a group of non-violent activists sitting in the street to protest the policies of the World Bank and IMF, and a young man near me who couldn’t crawl away fast enough had 3 ribs broken by a riot cop’s bludgeon. It seems that the Belarusian police, given the destruction of government property and attempt to take over Parliament, were very restrained. The people still imprisoned after the events of December 19, including 3 ex-candidates, were convicted of participation in or instigation of the riot. Imagine the reaction if a similar event had taken place at the Capitol building.

Many of the ex-presidential candidates (there were 10 candidates in all) have well-documented relations with the West, which isn’t surprising given the millions that the US and Europe spend on “democratic transition” in the country. They generally call for privatization of state enterprises, liberalization of the economy and adhesion to NATO. A number of them have spent time studying regime change at the George C. Marshall Center European Center for Security Studies in Germany, a partnership between the US military (US European Command) and the German government, which, according to the US embassy in Minsk, hosts 25 Belarusians per year. Since 2001, the US has enacted a series of Belarus Democracy Acts, applying economic sanctions, visa blacklists and asset freezes on government-related people and companies, and providing tens of millions of dollars per year for the promotion of “democracy.”

In February of this year, citing the recent elections, the US State Department announced an increase of its “democracy assistance” to Belarusian civil society by 30% to $15 million for the year. In 2009, the National Endowment for Democracy gave $2.7 million to finance Belarusian “independent” media, civil society (promoting “democratic ideas and values… and a market economy”), NGOs and political groups. A Wikileaks cable (VILNIUS 000732, dated June 12, 2005) confirmed money smuggling into Belarus on the part of USAID contractors, though such proof is hardly necessary. Also in February, the EU, individual European countries, Canada and the US put together a “war chest” of 87 million euros aiming toward regime change in Belarus. With so much money being offered to anyone who wants a job as an activist, it’s not hard to find takers. Youth who run into trouble are offered free education in the West. There is evidence that many of those who partook in the violent acts of the night of December 19th were paid for their participation, by either Western or Russian elements.

For the West is not the only source of financing, nor of interventionist pressure. One of the most important ex-candidates was financed by the Russians. While Western pressure is a known quantity in Belarus, Russian attempts at destabilization are relatively new. Russian oligarchs have been ogling the profitable Belarusian state enterprises, and since the government has historically refused to sell them, the Russian kleptocracy has begun to try to topple Lukashenko. The Russian media have begun a concerted campaign against the Belarusian government, airing pro-opposition documentaries and indulging in smearing and misinformation. Russian operatives are now making inroads; on the Minsk-Moscow highway, my Belarusian friend pointed out the expensive Russian cars with tinted black windows heading into Minsk. Russian oil prices have risen sharply — 30% in January — and the price of natural gas imported from Russia has quadrupled in four years. Although the economy has diversified since independence, it is still reliant on importing energy and raw materials for its production. The hike in energy and commodity prices has had a harsh impact in Belarus, where the cost of energy now makes up 78 cents of every dollar of goods produced. High commodity prices explain the trade deficit despite strong industrial and export growth.

In January of this year, at the same time that the Russians severely raised oil prices, Belarus was subjected to a major speculative attack on its currency. The Russians control 37% of the country’s banking sector, and according to analysts in Minsk, early this year Russian banks started to sell off their Belarusian rubles. In January, 50 times more foreign currency was bought with Belarusian rubles than in December, and that pattern continued in February and March. This sparked the effect desired: inflation of 33% in the first half of the year, general panic and a run on the bank where people tried to convert their Belarusian rubles into dollars or gold. The central bank was obliged to devalue the Belarusian ruble by 36%. The government has not printed currency, contrary to some media reports. The speculative attacks have not been covered in the news; Ria Novosti for example typically stated that “the Belarusian ruble collapsed in the first five months of the year as the result of a large trade deficit, generous wage increases and loans granted by the government ahead of the December 2010 presidential elections, which spurred strong demand for foreign currency.” But the trade deficit is not new and would not itself spark a currency collapse, while wage increases or loans would not logically provoke a demand for foreign currency.

According to Minsk residents, the main problem this Spring has not been a lack of products on the shelves, as one reads in the West, but rising prices, a shortage of foreign currency and hoarding, which has somewhat disrupted the supply chain. When I was there in mid-late June, the shelves were fully stocked, the stores and markets were full of shoppers and there were no lines at gas stations, contrary to what Western media have been reporting. Inflation is apparently stabilizing now. Protests on the Western borders by cross-border traders have been widely covered by Western media who are seeking signs of unrest, but who rarely show that the traffic of cheap Belarusian products and gasoline for sale at a profit in the West is a practice that is harmful for the Belarusian economy, especially in the context of the current economic difficulties. This is why the government recently limited such border crossings to once every 5 days (formerly traders would often go 5 times per day) and to limit the products that can be individually exported. The scarcity of foreign currency explains the late payment of bills to the Russian electricity supplier (which demands payment in dollars), prompting it to temporarily halt delivery of electricity to Belarus a number of times recently. This strong-arming, reported extensively in the international press, is more bark than bite since Russia only provides around 12% of Belarusian electricity and there have been no blackouts.

Because of the spiraling Belarusian ruble, the government has had to seek foreign loans. It has appealed to the IMF for a loan of $8 billion, though the IMF replied on June 13 that a loan would come with the usual strings attached — structural adjustment programs, privatizations, a freeze on salaries, letting the Belarusian ruble float, etc. The IMF admonishes the government that it has not yet enacted similar conditions that were set with the last loan it received in 2009 during the world financial crisis; for example, a government agency to oversee privatizations was created but no privatizations carried out. On the other hand, it was rarely reported that the IMF also hailed measures by Belarus’ government to end the country’s financial crisis, for example raising interest rates and supporting the unemployed and poor.

Whether the country will get an IMF loan or not, the traditional refusal to privatize is now ending, since the country was granted a $3 billion emergency loan from the Russian-controlled Eurasian Economic Community, which also had strings attached for the privatization of $7.5 billion of state enterprises over 3 years. This is part of what the Russian oligarchs have been working toward. The first disbursement of this loan, $800 million, was released on June 21, putting an end to the immediate financial problems. However, the Russians may not be getting the cheap deals they had wanted, nor will they necessarily be the beneficiaries of the privatizations. The actual sales and IPOs are in negotiation, and President Lukashenko has been very clear that by Belarusian law, privatizations of state enterprises must follow strict conditions. On June 17, he stated, “The conditions have been spelt out: the company should develop, it should not be closed, the workers’ pay should increase each year, they should be protected socially and, most importantly, the company should be modernized. That is, if you come and buy it, you should invest in its development.”

On June 30, Venezuela, with whom Belarus has close economic and diplomatic ties (among other agreements, Venezuela has provided oil to Belarus), announced its interest in acquiring shares in Belarusian state companies. Analysts in Minsk say that the country is reorienting itself away from Russia and toward China. An IPO on foreign stock exchanges of a minority stake in the huge state potash and fertilizer company, Belaruskali, is in preparation, and the national gas pipeline will most likely be sold to Gazprom. Other state enterprises are on the block, and the future is unknown; but President Lukashenko stated recently that “I would like to give you firm assurances that we will not accept risky experiments or an unacceptable lowering of living standards. We will continue implementing a Belarusian economic model, which has proved to be stable under different and complex circumstances for over 15 years.”

The economy seems to be showing signs of stabilizing now. Despite the recent financial troubles, Belarus’ debt remains at an impressively low level: including the recent loan, public debt will not exceed 45% of GDP, including both domestic and foreign public debt. The foreign debt ceiling is 25% of GDP. The government has reported a slight trade surplus of $116 million in May, apparently because of import restrictions enacted this Spring. The finance ministry has recently lowered its 2011 GDP growth forecast to 4.5% and the World Bank has recently lowered it to 2.5%; at even 2.5%, the economy is clearly resisting. The World Bank added that the Belarusian economic model isn’t viable; rather it should be more concerned with the US model of credit-based consumption and skyrocketing foreign debt.

In June, coinciding with these financial problems, Western governments returned to the attack, as though to take advantage of the momentum to destabilize the Belarusian government. On June 14, President Obama renewed and reinforced US sanctions against the country, declaring a “national emergency” (that is, for the US, not Belarus) and citing, incredibly, “the unusual and extraordinary threat to the national security and foreign policy of the United States” that Belarus constitutes. The only way in which he may be right is simply in that the success of the Belarusian economic model constitutes a threat to neoliberal dogma. On June 17, the UN Human Rights Council voted to condemn “human rights violations” following the recent presidential election. On June 20, the European Union in their turn reinforced its sanctions against Belarus, adding companies and names to the blacklist (the Belarusian government has stated its intention to sue the initiators of the sanctions), and the European Bank for Reconstruction and Development has reoriented its financing activities away from the government and toward “civil society.”

And “civil society” hasn’t missed the opportunity provided by US tech camps and the recent financial troubles. Since the beginning of June, there has been a new movement on the part of various opposition groups in Belarus, calling itself “revolution through social networks.” They have taken to weekly protests in the central streets organized on the internet or by twitter in which participants clap their hands, without banners or chanting. Since the violence of December 19th, protests have been prohibited in the central area of Minsk, though they are allowed in certain other areas of the city. Whatever one thinks of this prohibition, it is clear that these protests consist of the same pro-Western, well-financed groups with a new, high-tech face. According to Western media, the protests are being violently repressed and protesters arbitrarily arrested. According to Belarusian authorities, participants have been arrested because they were shouting profanities at police and pushing them. I unfortunately didn’t happen to see one of the protests while I was in Belarus recently, and can’t personally report more details about them. A number of videos of the protests are available on the web, and I’ve seen no violence in them, no raised billy clubs and no blood; one can see protesters being arrested but not what immediately preceded the arrests. If there were major police violence, one could be sure that images of it would be all over the web. Of course, the government should make images available showing that it is violent participants who are arrested, since the arrests only play into the protesters’ hands and give Western governments more fodder for sanctions. The number of participants is unclear from the videos, which are usually closely framed shots. One video claiming to show a clapping protest was clearly not one, as within the clapping crowd (probably an audience applauding an outdoors show) one can see the red and green Belarusian flag, which is never used by those who protest the government — they fly the former red and white national flag as well as the European blue one.

I did speak to people, including youth, about the protests. One young man, when he learned that I was from the US, said to me, “Flashmob! Fun!” giving me the thumbs up. For him, it was clearly more of a fun public gathering with drums, stomping and clapping, than a real political statement. Another young man told me, “When I read Western media, I wonder, is this my country? Am I in a war zone?” What is clear in the videos is that the crowd is well-off. Belarusian participants in Clinton’s tech camp said as much; according to the AP, they “described the active opposition as largely limited to students and educated citizens. The movement needs the support of working class people, said the activists.” Clearly, the Belarusian working class has reasons not to support the current movements: they are generally satisfied with the policies of President Lukashenko. If the movements are limited to the Western-oriented elite, Western or Russian financed operatives, and youth wanting to have a street party, then they have no future, no matter how many millions the US and others throw at them.

On July 6, the US House renewed the Belarus Democracy Act, sponsored by Rep. Christopher Smith of New Jersey, chairman of the Helsinki Commission. During the debate, Rep. Ron Paul denounced it. He said:

“I rise in opposition to the Belarus Democracy Act reauthorization. This title of this bill would have amused George Orwell, as it is in fact a US regime-change bill. Where does the United States Congress derive the moral or legal authority to determine which political parties or organizations in Belarus — or anywhere else — are to be US-funded and which are to be destabilized? How can anyone argue that US support for regime-change in Belarus is somehow promoting democracy? We pick the parties who are to be supported and funded and somehow this is supposed to reflect the will of the Belarusian people? How would Americans feel if the tables were turned and a powerful foreign country demanded that only a political party it selected and funded could legitimately reflect the will of the American people? I would like to know how many millions of taxpayer dollars the US government has wasted trying to overthrow the government in Belarus. I would like to know how much money has been squandered by US government-funded front organizations like the National Endowment for Democracy, the International Republican Institute, Freedom House, and others…. It is the arrogance of our foreign policy establishment that leads to this kind of schizophrenic legislation, where we demand that the rest of the world bend to the will of US foreign policy and we call it democracy. We wonder why we are no longer loved and admired overseas. Finally, I strongly object to the sanctions that this legislation imposes on Belarus. We must keep in mind that sanctions and blockades of foreign countries are considered acts of war. Do we need to continue war-like actions against yet another country? Can we afford it? [...] We have no constitutional authority to intervene in the wholly domestic affairs of Belarus or any other sovereign nation.”

I can only agree wholeheartedly, and wish the government and the people of Belarus courage in their resistance to the current attacks, and success in protecting their independence. At the international conference in Brest on the resistance to Nazism, participants described again and again the heroic courage and strength of the Belarusian people during the war years under the invasion coming from the West. Belarusians will need to continue to draw on that strong character for some time to come, as the attacks are not yet finished, but they have proven they are up to the fight.

Mich?le Brand is an independent journalist and researcher originally from the US, living in Paris. She can be reached at michbrand@free.fr.