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HOW MODERN MONEY WORKS — Economist Alan Nasser presents a slashing indictment of the vicious nature of finance capitalism; The Bio-Social Facts of American Capitalism: David Price excavates the racist anthropology of Earnest Hooten and his government allies; Is Zero-Tolerance Policing Worth More Chokehold Deaths? Martha Rosenberg and Robert Wilbur assay the deadly legacy of the Broken Windows theory of criminology; Gaming the White Man’s Money: Louis Proyect offers a short history of tribal casinos; Death by Incarceration: Troy Thomas reports from inside prison on the cruelty of life without parole sentences. Plus: Jeffrey St. Clair on how the murder of Michael Brown got lost in the media coverage; JoAnn Wypijewski on class warfare from Martinsburg to Ferguson; Mike Whitney on the coming stock market crash; Chris Floyd on DC’s Insane Clown Posse; Lee Ballinger on the warped nostalgia for the Alamo; and Nathaniel St. Clair on “Boyhood.”
Oligarchs Triumphant

Ukraine, Omidyar and the Neo-Liberal Agenda

by CHRIS FLOYD

1.

The Western intervention in Ukraine has now led the region to the brink of war. Political opposition to government of President Viktor Yanukovych — a corrupt and thuggish regime, but as with so many corrupt and thuggish regimes one sees these days, a democratically elected one — was funded in substantial part by organizations of or affiliated with the U.S. government, such as the National Endowment for Democracy (a longtime vehicle for Washington-friendly coups), and USAID. It also received substantial financial backing from Western oligarchs, such as billionaire Pierre Omidyar, founder of eBay and sole bankroller of the new venue for “adversarial” journalism, First Look, as Pandodaily reports.

Yanukovych sparked massive protests late last year when he turned down a financial deal from the European Union and chose a $15 billion aid package from Russia instead. The EU deal would have put cash-strapped Ukraine in a financial straitjacket, much like Greece, without actually promising any path for eventually joining the EU. There was one other stipulation in the EU’s proffered agreement that was almost never reported: it would have also forbidden Ukraine to “accept further assistance from the Russians,” as Patrick Smith notes in an important piece in Salon.com.  It was a ruthless take-it-or-leave-it deal, and would have left Ukraine without any leverage, unable to parlay its unique position between East and West to its own advantage in the future, or conduct its foreign and economic policies as it saw fit. Yanukovych took the Russian deal, which would have given Ukraine cash in hand immediately and did not come with the same draconian restrictions.

It was a policy decision. It might have been the wrong policy decision; millions of Ukrainians thought so. Yanukovych, already unpopular before the deal, would have almost certainly been ousted from office by democratic means in national elections scheduled for 2015. But the outpouring of displeasure at this policy decision grew into a call for the removal of the government. Meanwhile, behind the scenes, Washington was maneuvering to put their preferred candidate, Arseniy Yatseniuk, in charge of the Ukrainian government, as a leaked tape of a conversation between Victoria Nuland, assistant secretary of state, and Geoffrey Pyatt, U.S. ambassador to Ukraine, clearly showed. It is worth noting that when Yanukovych was finally ousted from power — after the opposition reneged on an EU-brokered deal for an interim unity government and new elections in December — Arseniy Yatseniuk duly took charge of the Ukrainian government, as planned.

By all accounts, Viktor Yanukovych was an unsavoury character running an unsavoury government, backed by unsavoury oligarchs exploiting the country for their own benefit, and leaving it unnecessarily impoverished and chaotic. In this, he was not so different from his predecessors, or from many of those who have supplanted him, who also have oligarchic backing and dubious connections (see addendum below).  But in any case, the idea of supporting an unconstitutional overthrow of a freely elected Ukrainian government in an uprising based squarely on the volatile linguistic and cultural fault-lines that divide the country seems an obvious recipe for chaos and strife. It was also certain to provoke a severe response from Russia. It was, in other words, a monumentally stupid line of policy (as Mike Whitney outlines here).  Smith adds:

“[U.S.] foreign policy cliques remain wholly committed to the spread of the neo-liberal order on a global scale, admitting of no exceptions. This is American policy in the 21st century. No one can entertain any illusion (as this columnist confesses to have done) that America’s conduct abroad stands any chance of changing of its own in response to an intelligent reading of the emerging post–Cold War order. Imposing “democracy,” the American kind, was the American story from the start, of course, and has been the mission since Wilson codified it even before he entered the White House. When the Cold War ended we began a decade of triumphalist bullying — economic warfare waged as “the Washington Consensus” — which came to the same thing.”

American policy is based upon — dependent upon — a raging, willful, arrogant ignorance of other peoples, other cultures, history in general, and even the recent history of U.S. policy itself. The historical and cultural relationships between Ukraine and Russia are highly complex. Russia takes its national identity from the culture that grew up around what is now Kyiv; indeed, in many respects, Kyiv is where “Russia” was born.  Yet one of the first acts of the Western-backed revolutionaries was to pass a law declaring Ukrainian as the sole state language, although most of the country speaks Russian or Surzhyk, “a motley mix of Ukrainian and Russian (sometimes with bits of Hungarian, Romanian and Polish),” as the LRB’s Peter Pomerantsev details in an excellent piece on Ukraine’s rich cultural and linguistic complexity.  This is not to say that Ukrainians are not justified in being wary of Russia’s embrace.  Millions of Ukrainians died in the 1930s from the famine caused by inhuman policies imposed by a Moscow government (although that government was itself headed by a Georgian, in the name of a trans-national ideology). The complexity and volatility is always there. Today, as Smith puts it, “many Ukrainians see room for closer relations with the West; the more sensible seem to favor a variant of “third way” thinking, no either/or frame. Many fewer desire a decisive break with Russia.”

Yet at every turn, the new Western-backed government in Kyiv has stomped hard on these volatile fault-lines, pushing stringent anti-Russian policies, with Western governments pretending that this would have no consequences, no reverberations in Moscow. What’s more, the neo-fascist factions that played a leading role in the uprising are now calling for Ukraine to become a nuclear power again, having given up the Soviet nuclear weaponry on its territory in 1994. Indeed, hard-right leader Oleh Tyahnybok made nuclear re-armament one of the planks of his presidential race a few years ago. Now the party is sharing power in the Western-brokered government; will we soon see Ukraine added to the ranks of nuclear nations? With a bristling nuclearized frontier with Russia — like the hair-trigger holocaust flashpoint between India and Pakistan?

Again we see the blind stupidity of arrogance, of entitlement, as the “Washington consensus” of elitist neo-liberalism continues its blundering away around the world.

2.
Now we stand on the brink of war over Crimea. Here too there are historical complexities entirely ignored by the media narrative. The Crimea was not considered part of Ukraine until it was simply tranferred by administrative edict in 1954 by the Soviet government, removing it from the Russian “socialist republic”  to the jurisdiction of the Ukranian “socialist republic.” When the Soviet Union collapsed, the Crimea became an autonomous republic operating under the constitution of Ukraine. Its population is about 60 percent Russian, yet this majority has had its language stripped of official status by the government in Kyiv which took power outside of constitutional means.

None of this justifies the heavy-handed muscle-flexing that Putin has been engaging in. But Russia, in post-Soviet times, with no trans-national ideology, has become a highly nationalist state.  Putin is an authoritarian leader who now bases his threadbare claims to “legitimacy” — and the dominance of his brutal clique — on his championing of Russian nationalism and “traditional values”. It is inconceivable that he would not consider the West’s blatant interference in Ukraine to be an act of provocation and brinkmanship aimed at him and his regime, and that he would react accordingly.

So here we are. Chaos, strife, the threat of war — and the heavy smoke of ignorance covering it all. Sleepwalking once more toward disaster. Deliberately setting tumultuous events in motion without the slightest concern for their ultimate consequences, or the suffering they will cause, now and perhaps for generations to come. (Think of Iraq, for example, or the spread of violence and chaos that has already flowed to many countries from the intervention in Libya’s internal affairs.)

But why are we here? Greed. Greed and the lust for dominance. Let’s not say “power,” for that word carries positive connotations, and can also include an element of responsibility.  But the oligarchs and ideologues, the militarists and ministers involved in this episode of Great Gamesmanship don’t want power in any broader, deeper sense. What they want is dominance, to lord it over others — physically, financially, psychologically. Among those at the top in this situation, on every side, there is not the slightest regard for the common good of their fellow human beings — not even for those with whom they share some association by the accident of history or geography: language, nationality, ethnicity. The lust for loot and dominance outweighs all the rest, regardless of the heavy piety oozing from the rhetoric on all sides.

And if war is avoided, what is the likely outcome for Ukraine (aside from living in eternal tension with an enraged, threatened, authoritarian neighbor to the North)? Smith tells us: betrayal.

“Instantly after Yanukovych was hounded from Kiev, seduction began its turn to betrayal. The Americans and Europeans started shuffling their feet as to what they would do for Ukrainians now that Russia has shut off the $15 billion tap. Nobody wants to pick up the bill, it turns out. Washington and the E.U. are now pushing the International Monetary Fund forward as the leader of a Western bailout.If the past is any guide, Ukrainians are now likely to get the “shock therapy” the economist Jeffrey Sachs urged in Russia, Poland and elsewhere after the Soviet Union’s collapse. Sachs subsequently (and dishonestly) denied he played any such role — understandable given the calamitous results, notably in Russia — but the prescription called for off-the-shelf neoliberalism, applied without reference to any local realities, and Ukrainians are about to get their dosage.

“It is wrong, as ahistorical thinking always is. Formerly communist societies, especially in the Eastern context, should logically advance first to some form of social democracy and then decide if they want to take things further rightward. Washington;s fear, evident throughout the Cold War, was that social democracies would demonstrate that they work — so presenting a greater threat, paradoxically, than the Soviet model. Ukrainians favoring the Westward tilt, having idealized the E.U., appear to assume they are to evolve into some system roughly between the Scandinavians and Germany, as East Europeans earlier anticipated. They will thus find the I.M.F.’s deal shocking indeed. It will be bitter, after all the treacherous, carefully couched promises.”

Whatever happens, it seems certain that oligarchs — Western, Ukrainian, European or Russian, will continue to exercise dominance — although some who backed the losing side too prominently may be cast down. Then again, most oligarchs, in every nation, are usually expert at playing both sides, or changing sides as necessary.

One is tempted to see this principle at work in the case of Pierre Omidyar, a prominent private backer of American efforts to fund and guide the Ukrainian opposition to power, as Pandodaily reported. Omidyar, who founded eBay and now owns PayPal, has recently become widely known — and universally lauded — for committing $250 million to fund First Look, a publishing group dedicated to adversarial journalism. He has assembled an all-star team for his venture, including Glenn Greenwald, Matt Taibbi, Jeremy Scahill, Marcy Wheeler and others of similar reputation. It is no exaggeration to say that he has become a bonafide hero of the left, which has tended to dismiss all criticism or questioning of his new enterprise, or his wider operations, as the grumbling of jealous losers — or even as covert actions of the State, trying to derail this dangerous new threat to elite rule.

Yet the fact remains that Omidyar’s wider operations — including those in Ukraine — sit uneasily with the image of an adversarial paragon and danger to the system. Putting aside the troubling circumstance of adversarial activism being dependent on the personal whims of a billionaire, there is the fact that Omidyar’s philanthropic vision lies largely in the monetizing of poverty relief efforts — of turning them from charitable or government-based programs into money-making enterprises which reward investors with high returns while often leaving the recipients worse off than before. As nsfwcorp.com reports, these include micro-financing initiatives in India that have led to mass suicides among the debt-ridden poor, and “entrepreneurial” programs which bestow property rights on the small plots of slum-dwellers — who, still in dire straits, sell them, for a pittance, to large-scale operators who then clear the ghettos for profitable developments, leaving the poor to find another shanty-town elsewhere. In this, Omidyar has partnered with Hernando de Soto, a  right-wing “shock doctrinaire” and one-time advisor to former Peruvian dictator, Alberto Fujimori; de Soto is also an ally of the Koch Brothers. Omidyar has also poured millions of dollars into efforts to privatize, and profitize, public education in the United States and elsewhere, forcing children in some of the poorest parts of the world to pay for basic education — or go without.

Thus Omidyar seems very much a part of the “neo-liberal order” which, as Patrick Smith noted above, the United States has been pushing “on a global scale, admitting of no exceptions.” So it is not surprising to see him playing a role in trying to spread this order to Ukraine, in tandem with the overt efforts and backroom machinations of the U.S. government. Omidyar is, openly, a firm adherent of the neo-liberal order — privitazing public assets for individual profit, converting charity and state aid to profitable enterprises for select investors, and working to elect or install governments that support these policies.

None of these activities are illegal. None of them necessarily preclude him also funding independent journalism. But I can’t see that it is unreasonable to bring up these facts and point them out. I don’t think it’s unreasonable to apply the same kind of considered skepticism toward this billionaire oligarch that you would apply to any other. For instance, if one of First Look’s websites publishes some blistering expose on the nasty machinations of some other oligarch or corporate figure, I don’t think it will be unreasonable for people to look and see if the target happens to be a rival of Omidyar’s in some way, or if his or her removal or humbling would benefit Omidyar’s own business or political interests. One does the same with the New York Times and its obvious pro-Establishment agenda, or with Rupert Murdoch’s newspapers, and so on; the wider context helps the reader put articles in perspective, and weigh them accordingly. It doesn’t mean the facts of this or that particular story are untrue; it does mean they aren’t swallowed whole, uncritically, without awareness of other agendas that might be in play.

This seems so elementary that it’s almost embarrassing to point it out. Yet for the most part, anyone who raises these kinds of questions about Omidyar’s media enterprise has been immediately shouted down, sometimes vociferously, by those who otherwise evince a savvy skepticism toward Big Money and its agendas. Many of those assailing the Pandodaily report about Omidyar and Ukraine pointed out that “this is the world we live in” — a world dominated by Big Money — and you have to make the best of a bad lot. And anyway, news outlets have always been owned by rich and powerful interests, and First Look is no different.

Well yes, exactly. And thus First Look — owned solely by a neo-liberal billionaire, who, as Jeremy Scahill has pointed out, takes a very active interest in the daily workings of his news organization — should be subject to the same standards of scrutiny as any other news outlet owned by the rich and powerful. But this doesn’t seem to be happening; quite the opposite, in fact.

I think perhaps there might be a category mistake at work here. Because of the reputations of those who have signed up with Omidyar, the idea has taken hold that Omidyar is dedicated to throwing a broad light on the secret machinations of the national security state and its imperialist rampages around the world. But Scahill’s statement intimates that Omidyar’s “vision” is actually much more limited. The interview that Scahill gave to the Daily Beast, quoted by Pandodaily, is quite revealing. Below is an excerpt, somewhat longer than the Pando quote:

“The whole venture will have a lower wall between owner and journalist than traditional media. Omidyar, he says, wanted to do the project because he was interested in Fourth Amendment issues, and they are hiring teams of lawyers, not just to keep the staff from getting sued, but to actively push courts on the First Amendment, to “force confrontation with the state on these issues.”

‘“[Omidyar] strikes me as always sort of political, but I think that the NSA story and the expanding wars put politics for him into a much more prominent place in his existence.  This is not a side project that he is doing. Pierre writes more on our internal messaging than anyone else. And he is not micromanaging. This guy has a vision. And his vision is to confront what he sees as an assault on the privacy of Americans.”’

Omidyar is passionately concerned about government encroachments on privacy, Scahill says, while noting — somewhat ominously — that the enterprise will have “a lower wall between owner and journalist than traditional media.” You might think this would set off alarm bells in a longtime adversarial journalist like Scahill, but apparently not. In any case, Omidyar’s entire neo-liberal ideology is based on the ability of wealthy individuals to operate free from government control as they circle the world in search of profit. (And also, if it happens, some social benefits by the way; but if one’s profit-making initiatives turn out to drive hundreds of people to suicide, well, c’est la vie, eh?) Naturally, wealthy individuals also want to be free from government spying as they go about their business. They are happy to cooperate with the National Security State when there is mutual benefit to be had, as with Omidyar and his government partners in Ukraine — but they want it to be on their terms. They want their own information to remain within their control. The overthrow of foreign governments, the invasion of foreign lands, the extrajudicial murder of people around the world, the militarization of American policy and society — this does not really concern them. In fact, it helps them expand the parameters of their business and extend their neoliberal ideology. But the idea that the government might also be spying on them – well, this is intolerable. This must be resisted, there must be a “confrontation” about such behavior.

I’m sure the writers hired by Omidyar’s quarter of a billion dollars will produce work of value, dig up some useful facts. So does the Times, so does the now oligarch-owned Washington Post, so do Murdoch’s papers on occasion. But I don’t think Omidyar’s enterprise has been set up to challenge the status quo or pose the “threat” to the system that its hero-worshippers are looking for. Indeed, even Greenwald calls only for “reforms” of the system, for “real oversight” of the National Security State by legislators — the same legislators bought, sold, cowed and dominated by Big Money. I honestly don’t think that the powers-that-be feel threatened by an enterprise set up by one of their number that confines itself to calls for “reform” from “within” — especially when its sole owner continues to cooperate with the Koch Brothers, hard-right ideologues like Hernando de Soto and indeed with the National Security State itself in subversive adventures overseas.

Omidyar’s goals are limited: to protect the privacy of the individual from government. This is a noble, worthy aim. But based on his own actions, he is perfectly content for that privacy-protected individual to advance a punishing neo-liberal agenda on the rest of the world, and at home, in collusion with the National Security State if need be. Whether Greenwald, Scahill, Taibbi, Wheeler and the rest are equally content with this agenda is something we will find out in the months to come.
***
UPDATE: Speaking of triumphant oligarchs, after the above was written, this news came flying in over the transom from the New York Times:

“The office of President Oleksandr V. Turchynov announced the two appointments on Sunday of two billionaires — Sergei Taruta in Donetsk and Ihor Kolomoysky in Dnipropetrovsk — and more were reportedly under consideration for positions in the eastern regions.

The strategy is recognition that the oligarchs represent the country’s industrial and business elite, and hold great influence over thousands of workers in the east. Officials said the hope was that they could dampen secessionist hopes in the east.”

As always, it’s a win-win situation for the oligarchs of this world.

Chris Floyd is a columnist for CounterPunch Magazine. His blog, Empire Burlesque, can be found at www.chris-floyd.com.