From Volume 4, Issue Number 25 of EIR Online, Published June 21, 2005
Russia and the CIS News Digest

List's "National System Of Political Economy" Published In Russia

A 300-page volume of seminal 19th-century writings on "national economy" has just been published in Russian by the Yevropa Publishing House in Moscow. Prepared for press by Ekspert magazine editor-in-chief V.A. Fadeyev, who wrote the introduction, the volume includes Friedrich List's "The National System of Political Economy," Count Sergei Witte's pamphlet, "On Nationalism: National Economy and Friedrich List," and D.I. Mendeleyev's celebrated "A Literate Tariff, or an Investigation of the Development of Russian Industry in Connection with the General Tariff of 1891."

Fadeyev's introduction is posted on Ekspert's site. The weekly is one of the most respected magazines in Russia. Fadeyev summarizes List's argument against free trade and in favor of protectionism, including List's polemic to the effect that "free trade" as a "scientific" doctrine was bought and paid for—from Ricardo and others —by the British.

Fadeyev discusses Mendeleyev's adoption of List's ideas, for the development of the oil industry in Russia (without mentioning the great Russian scientist's travels to the Untied States and participation in the 1876 Centennial exhibition, organized by Henry Carey's circles in Philadelphia). As for Count Witte, Fadeyev rightly reports that Witte's following of the "national economy" school went far beyond protectionism, and allowed him to organize "a stunning economic upsurge" in Russia at the end of the 19th century. Fadeyev writes, "To state it short and sweet, Witte's doctrine was the following: importing capital is preferable to importing commodities; importing capital goods is preferable to importing consumer goods. It follows that we need a strong financial system, capable of servicing capital, a convertible ruble, technology imports, the development of education, and creation of powerful infrastructure in transportation and energy, including with the direct participation of the state."

Today, Fadeyev laments, "Russia is the kernel of a collapsed empire, and has not been able to find a main line for its own economic development. Unfortunately, the array of ideas circulating among the public and even in scientific circles is a good deal poorer, than a hundred years ago. Marxist-Leninist political economy and "economics" (the term is borrowed directly from English to denote generally accepted classroom economics, imported from the West) have dried out our brains to such an extent, that we manage to get lost in questions for which the answers were discovered a very long time ago. Read the works of these three outstanding people—List, Mendeleyev and Witte. They may be of some use for you."

"Dialogue of Civilizations" Figure Elevated At Russian Railways

Gennadi Fadeyev, president of the joint-stock company Russian Railways (formed in 2002 on the basis of the later eliminated Railways Ministry), learned during a June 15 meeting of Commonwealth of Independent States transportation officials, that he had been relieved of his duties, and would become an advisor to Prime Minister Mikhail Fradkov. Vladimir Yakunin is promoted from vice-president to president of Russian Railways, replacing Fadeyev.

Yakunin is a trained engineer from St. Petersburg, who was involved in a number of projects with Vladimir Putin, during the Russian President's work in the government of his native city. He is known as a member of the St. Petersburg team of managers, originating from the science and business circles around Academician Zhores Alfyorov, the Nobel laureate in physics who heads the Ioffe Institute in St. Petersburg. In addition, Yakunin is called "General Yakunin" by Petersburg cognoscenti, in acknowledgement of his intelligence background. In recent weeks, his name surfaced as a candidate for the premiership of Russia, as rumors circulated about the possible dismissal of Prime Minister Fradkov. Some commentaries on his latest promotion, including in widely-read Izvestia tout Yakunin as a Presidential candidate in 2008.

Two particular projects of Vladimir Yakunin are the Center of National Glory of Russia and the series of international meetings, co-sponsored by that center and held in the past few years on the Greek island of Rhodes and in other locations, under the title "Dialogue of Civilizations." In fact, in the days before his promotion, Yakunin had hosted Sonia Gandhi, leader of the Indian National Congress, at a special Dialogue of Civilizations meeting in Moscow. (The father of the Italian-born Gandhi was a POW in Russia during World War II, during which time he studied Russian. Later he gave his children Russian names, and Sonia as a youngster learned enough Russian to read Pushkin.) After the Moscow meeting, Sonia Gandhi visited St. Petersburg, where President Putin—in town for the St. Petersburg Economic Forum—spent the better part of a day giving her a tour of his native city and continuing the dialogue of cultures.

Putin Attends St. Petersburg Forum

Remarks by Russian President Putin at the St. Petersburg Economic Forum, held the week of June 13, were of interest —albeit, typically for Putin, not decisive—for the way in which he referred to the Great Depression, and brought up the role of the state in the economy. In his opening message, Putin included the following comment: "It is evident that excessive participation of the state in economic life can impede entrepreneurial initiative. We experienced this. At the same time, the state cannot completely take itself out of the picture, since there are economic sectors in which its presence is entirely justified and well-founded. I mean, first and foremost, certain infrastructure projects and the military-industrial complex. Of course, each country determines its own economic policy, but exchanging experience and jointly discussing this problem at this forum will be extremely useful."

In concluding remarks on June 14, Putin said: "At the beginning of this discussion there was a small amount of analysis, but analysis nonetheless, of the interrelationship of two tendencies: the paternalist, i.e., a great degree of state participation in the economy's development, and the liberal. And it was stated, correctly, that different forms of management have been more effective or less effective, in different periods of development of the world economy. Let us recall the Great Depression in the USA at the end of the 20s and beginning of the 30s. That is when the Soviet Union's planned economy yielded the greatest results; it was then that the industrial might of the USSR took shape. But later, when forms of development based on innovation became more effective, and the world economy became global, the excessively closed character, taken ad absurdum, and paternalist idea of the Soviet planned economy took the Soviet Union towards collapse. I think that many will agree with me, that any government, including the Government of Russia, of course, ought to be able to define the main tendencies of world development and the world economy, and should be able to determine the situation of its own country—social, political and economic."

Prosecutors Link British Chechen Operative Nukhayev To Klebnikov Killing

On June 9 it was leaked to that Russian prosecutors have merged the investigations into the killings of Forbes magazine editor Paul Klebnikov and former Chechen Deputy Prime Minister Yan Sergunin, who were gunned down on the street in Moscow in separate July 2004 incidents. The two Chechens, detained in the Klebnikov case in February, are now suspects in Sergunin's killing, too, along with a Moscow-based notary named Fail Sadreddinov. An RBK-TV broadcast, monitored by RFE/RL Newsline on June 6, reported prosecutors' leaks, that Klebnikov was killed in connection with his research on the plundering of state funds in Chechnya.

A week later, Prosecutor General's Office spokesman Vasili Lushchenko confirmed the leaks, adding that the mastermind of Klebnikov's killing was none other than Khoj-Akhmed Nukhayev—the fundraiser for Chechen separatism, erstwhile business partner of Lord MacAlpine, who arranged his private audience with British ex-PM Margaret Thatcher several years ago, and promoter of the "Caucasus Common Market" scheme. A year before his death, Klebnikov had published in Russian a series of interviews with Nukhayev, in which the latter laid out his guiding principles. The book, titled "Conversations With A Barbarian," has generally disappeared from Moscow bookstores.

Central Asia Electric Power Council Formed

Meeting June 10 in Astana, Kazakhstan, officials from the national electric power utilities of Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan agreed to form an coordination council on electricity in Central Asia. According to their press release, the group aims to coordinate strategies on electric power development in the region, as well as other energy resources and water use.

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