"Casual disregard" will never hurt Russia

Is Corporate America the corrupt mafia state?
As the US economy continues to drift in dangerous waters, some commentators apparently see an opportunity to divert attention away from America’s heap of dirty laundry, lobbing bitter attacks against Russia and its economic policies instead.

For anybody who doubts there are still Americans suffering from a Cold War hangover, they would do well to consider this zinger by Robert Kagan, a regular commentator with The Washington Post, who recently asked the question:

“Can the United States blithely do business with this corrupt, authoritarian mafia state?”

“Some in the administration don’t think so,” says Kagan, without revealing his official sources. “They doubt that foreign investors will ever flock to a Russia this corrupt and dangerous.”

Ironically, Russia gets branded “corrupt and dangerous,” yet it was “corrupt and dangerous” US companies (like Goldman Sachs) that encouraged investment into defective subprime mortgage loans, which in turn led to the near-collapse of the entire global economy. It required a government rescue package to the tune of $2 trillion taxpayer dollars to save the “too-big-to-fail” US financial institutions and other companies. The average American got a "cash-for-clunkers" program, and a brief reprieve on his mortgage payment.

Meanwhile, those affable American CEOs – not one of whom spent a single night pondering their indiscretions through prison bars – are relaxing on the proverbial beach while the people who rescued them can not even get a two-week vacation from their jobs. Even China, the other great oppressor state, still gives its workers more vacation time than American employers.

Yet it is Russia that gets branded as a “corrupt, authoritarian mafia state.”

For good measure, Kagan did not neglect to pin the “anti-Americanism” slur against Russians as well. Interesting how a country that is now home to about 1,000 American fast food restaurants, including McDonald’s, Burger King and Wendy’s, not to mention Coca-Cola and Chevrolet factories, could be branded “anti-American."  

Dmitry Peskov, press secretary to Prime Minister Vladimir Putin, penned a response in The Washington Post to the article, in which he criticizes the “casual disregard” that Kagan shows for Russia’s steady progress on both the economic and democratic fronts.

“Mr. Kagan’s column suggested that foreign investors won’t flock to Russia,” Peskov observed.

“That must be surprising news to the many multinational companies, such as Ford, PepsiCo, Alcoa and Boeing that have made major investments in the Russian market within the past year.”“Had Mr. Kagan attended last week’s St Petersburg International Economic Forum, he would have seen firsthand the successes that the government’s initiatives in various fields have begun to produce,” Putin's press secretary added.

It is perhaps understandable why US policy makers are feeling a bit edgy these days and more prone to squirt their venom at Russia. Despite President Barack Obama’s massive bailout and buy-in of US banks and businesses, the economic storm shows no sign of abating. Indeed, there is a growing sense that all Obama did with his “corporate socialism” was to forestall the inevitable tsunami.

If the Great Recession has taught us anything, it is that the US corporations still run the game. Despite being flush in hard currency reserves, companies are perpetuating what looks to be a downward death spiral: while US productivity rates are increasing, corporations refuse to hire new employees, nor raise the wages of their current workers (US wages, adjusted for inflation, have barely budged since the 1970s). Meanwhile, thanks to the decimation of US labor unions – the only real democratic voice inside of the corporate universe – companies have been given carte blanche to shed workers and freeze wages at will.

Indeed, the lack of a legitimate democratic voice inside the fortress of Corporate America (and not just for the largest stock holders) best explains the so-called “Cinderella Story” of US economic performance. It seems that somewhere along the way, somebody forgot to remind the CEOs that employees are also consumers; it is impossible to participate in capitalism without a steady job and honest wages.

Americans simply lack disposable income, and they already burned through their plastic long ago. Meanwhile, the one thing that gave Americans some sense of economic assurance and viability, home ownership, was wrecked in the wake of the subprime mortgage crisis, which has left US home prices in the basement.

Yet Russia, according to Kagan, is the “corrupt, authoritarian mafia state” that needs lessons on democratic reform. As an individual who has been affiliated with three US labor unions, it is clear to me that the US has no room to preach on this subject. If democracy is nonexistent inside of the economic realm, as it clearly seems to be, then democracy as a national project is redundant and, moreover, doomed.

It is largely ignored that US corporations now exert their infinite power and influence in the one place they were never intended to be: politics. While corporations are now able to bankroll the presidential candidate of their choice (Supreme Court Ruling, January 21, 2010:Citizens United vs. Federal Elections Commission), US workers have no ability to control the rapacious corporate appetite – not in the political realm, and certainly not in the economic. Yet nowhere in the US Constitution are corporations even mentioned.

Kagan goes on to write that, “Vice President Biden said in Moscow this year that greater freedom, democracy and respect for the rule of law in Russia were “necessary” to have “a good relationship.”

The economic modernization that Russian leaders claim to want will not be possible without political liberalization, he noted, and he emphasized the need for a “viable opposition” and “public parties that are able to compete.”

Russia, a vibrant democracy with about a dozen legitimate political parties, is criticized for not having a “viable opposition.” Perhaps what Kagan really means is a “viable opposition” that would give away Russia’s wealth at discounted prices, a devastating scenario that already occurred here in the not-so-distant past.

It would be refreshing if for once US policy makers and commentators would listen to their own advice. After all, can anybody remember the last time a Democrat or Republican, two parties that cannot wean themselves from the corporate teat, didn’t control the White House?

When that day comes, America’s advice will sound much less hypocritical and self-serving.

­Robert Bridge, RT