From Volume 7, Issue 19 of EIR Online, Published May 6, 2008
Russia and the CIS News Digest

Glazyev: Remember My 2001 Hearings

May 2 (EIRNS)—One week before the inauguration of Russia's new President, Dmitri Medvedev, economist Sergei Glazyev gave an interview to the nationalist weekly Zavtra, titled "Ten Steps To Rein In the Crisis." In the opening exchange, deputy editor Alexander Nagorny noted that Glazyev "and a number of well-known economists in our country and the world, including [Lyndon] LaRouche," had long said that a crash of the "global financial pyramid" was inevitable. Glazyev replied with the observation that Russia has already lost $30 billion due to holding its national reserves in the sinking dollar, and added, "If the leaders of the Central Bank and the government had listened to the recommendations from the parliamentary hearings, which we held seven years ago, those losses could have been avoided."

The hearings to which Glazyev referred were convened by him in June 2001 as chairman of the State Duma Committee on Economic Policy, on the subject of "Measures To Protect the National Economy Under Conditions of Global Financial Crisis." The lead-off witness was U.S. economist LaRouche. (EIR, July 6 and 20, 2001.)

Glazyev is currently director of the National Development Institute of the Academy of Sciences, and head of the Customs Union of the Eurasian Security Community. In Zavtra, he analyzed the inflationary money-pumping policies of the Federal Reserve. "This process is accelerating," he said, "like a snow avalanche. It began in 1971, when the U.S. leadership stopped exchanging dollars for gold, thus destroying the world financial relations that had existed until that time." He also identified the looting of Russia and the CIS through "shock therapy" in the 1990s as what had kept the "dollar financial pyramid" going into the 21st Century. But now, he said, "the possibilities for political blackmail of Russia have been exhausted."

Glazyev's ten steps feature the notion of making the ruble into a "world currency", through its promotion within the CIS and Eurasia at large, as well as an immediate shift to the denomination of trade with major partners in currencies other than the dollar. At the same time, he incorporates critical measures, such as "activation of the work of state development institutions, to extend credit for long-term investments into promising areas of economic growth." Glazyev concluded by saying that, based on these measures, "the Russian leadership could initiate the transition to a new global financial architecture."

Russia, Iran Hold Talks on Several Fronts

May 2 (EIRNS)—Russian Security Council acting head Valentin Sobolev held four days of talks in Tehran at the end of April, centered on nuclear energy cooperation and the package of proposals Iran has announced it will send to the "5+1" group (permanent UN Security Council members and Germany) that meets on Iran's nuclear program. Foreign Ministry Sergei Lavrov attended a meeting of those six countries in London, held in conjunction with May 1-2 ministerial meetings of the Temporary Coordinating Committee on Palestinian affairs, and the Quartet dealing with Middle East peace (U.S.A., Russia, UN, and EU).

The Russian-Iranian contacts, in particular, come under what Lyndon LaRouche termed an asymmetric response by major Eurasian powers, against the British drive for war across the continent.

In Moscow, Iranian Ambassador Golamreza Ansari met April 29 with Deputy Foreign Minister Sergei Kislyak, at Iran's initiative, for a conversation the Russian Foreign Ministry described as centering on the Iranian nuclear program. Kislyak holds the portfolio for several strategic issues, including missile defense systems.

Russia-Georgia Tension: More than a War of Words

April 29 (EIRNS)—The Russian Foreign Ministry issued four statements today on the escalation of tensions around Abkhazia, the autonomous region of Georgia that has been policed by Russian peacekeepers since a 1994 truce in its civil war. In the setting of British and U.S. attempts to get Georgia into NATO as soon as possible, Georgian President Michael Saakashvili's campaign to restore authority over Abkhazia and South Ossetia, another autonomous region that rejects central Georgian leadership, has become a flashpoint for armed conflict on Russia's southern border.

Among several armed incidents in April came the downing of an unmanned Georgian reconnaissance plane over Abkhazia on April 20. Saakashvili accused Russia of firing the missile. On April 16, President Vladimir Putin announced that Russia was extending consular and other special services to residents of Abkhazia and South Ossetia. Another April 29 Foreign Ministry statement denied that this was a step towards Russian "annexation," and justified Putin's action as aimed to protect people who are hostages of inter-ethnic conflicts.

The Foreign Ministry also stated that the latest escalation of tension "dictates the necessity" of increasing the number of Russian military personnel in the Abkhazia peacekeeping force, while remaining below the ceiling set by the UN mandate of 1994. Georgian Prime Minister Lado Gurgenidze denounced the Russian moves, saying that it will "utterly destabilize this region."

U.S. Confrontation with Belarus Escalates

May 1 (EIRNS)—Citizens of Belarus heard today that the United States had ordered their embassy and consulates in the U.S.A. closed, breaking diplomatic relations altogether, as was reported by the Associated Press and other news outlets from unnamed sources. State Department spokesman Tom Casey said later that this has not happened, but that the United States is "considering the full range of options in terms of our respective diplomatic presences."

Lyndon LaRouche observed that the showdown with Belarus is of greater strategic weight even than the tense situation around Abkhazia on the Georgia-Russia border, because of the country's geographical position in east central Europe. The government of President Alexander Lukashenka is positioned as an obstacle to the drive to expand NATO eastward, besides having resisted the whole package of monetarist economic destruction, foisted on the former Soviet bloc since 1991.

LaRouche noted that the Belarusian government has made known that it feels double-crossed by the United States. In December 2007, Ambassador Mikhail Khvostov accused the U.S.A. of violating the memorandum signed by Belarus, the U.S.A., Russia, and Great Britain in 1994, under which Belarus gave up its nuclear weapons and signed the Non-Proliferation Treaty as a non-nuclear power. This entailed, Khvostov said, "a written obligation by the United States to Belarus to refrain from economic coercion, designed to subordinate to the United States' own interest the exercise by Belarus of the rights inherent in its sovereignty, and thus to secure advantages of any kind." This means, Khvostov went on, that the United States "has given a written commitment to Belarus under international treaty not to impose economic sanctions of any kind on Belarus for political reasons."

The diplomatic row dates from November 2007, when the United States slapped economic sanctions on the petroleum products export firm Belnaftakhim, as punishment for alleged human rights violations and the arrest of opposition demonstrators after last year's elections. Belarus's two large oil refineries, inherited from the Soviet period, are the guts of its industrial economy and its ability to earn export revenue; also affected were financial institutions that process Belnaftakhim sales to other countries. Through a series of retaliatory expulsions of diplomats, the countries' two ambassadors have been recalled, and staffing at the embassies is down to a handful.

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