Streetwise Professor

May 7, 2011

Tour de Russe

Filed under: Economics,Energy,History,Politics,Russia — The Professor @ 3:21 pm

Haven’t written much Russia stuff lately–too many competing stories, too much competing for my time, and too much same-old, same-old in Russia.  But enough things have accumulated to deserve some comment.

First, to prove, as if more proof were needed, that Vladimir Putin is 110 percent Checkist, and -10 percent economist, he refuses even to countenance the possibility that his inane attempts to keep a lid on prices has caused shortages of gasoline. Instead, he sees dark conspiracies:

Russian Prime Minister Vladimir Putin accused oil companies on Thursday of a “conspiracy” to force up gasoline prices, as the world’s largest oil producer struggles to combat fuel shortages.

Putin rebuked Deputy Prime Minister Igor Sechin, his point man for energy, for suggesting at a government meeting that price rises had resulted from a lack of oil products offered for sale on commodities exchanges.

“It’s not a shortage. This is not about a shortage. This is a conspiracy. They are colluding,” Putin told Sechin, who serves on the board of state-controlled oil major Rosneft and is widely seen as the chief spokesman for the industry.

What a maroon.  And Sechin.  Oi  Perhaps his remark on commodity exchanges was mis-translated, because otherwise I have no clue what he was talking about.

By the way, the price control bug is spreading: here’s a story about China using “legal” means to impose unofficial price controls, with predictable effects (note the empty shelves in the pic).

Story 2.  When the Russia-China oil pipeline deal was signed, I predicted that the Russians would bridle at the super-secret pricing terms as soon as given the opportunity–and would attempt to renegotiate the terms later.  (My surmise at the time was the super-secrecy was intended to conceal how unfavorable the terms were–and hence how desperate the Russians were.)  The entertaining and informative John Helmer has some details:

This is unusual outspokenness from the state pipeline company whose chief executive, Nikolai Tokarev, has made a career of secretiveness. All the more curious, says a Russian analyst of state contracting practices, Alexei Navalny. He told Asia Times that the conflict with CNPC is not really with the pipeline company Transneft, but with the oil producer and exporter, state oil company Rosneft. Navalny has filed Moscow court actions as a shareholder of Rosneft for disclosure of the terms of the company’s contract to sell oil to CNPC. He believes the price formula set by Rosneft is “far from a market one”, and accordingly it is understandable why the Russian side wants now to extract more profit from the trade, while the Chinese insist on sticking to the contract formula. Navalny does not speculate on how the oil pricing is tied to Rosneft’s and Transneft’s repayments of their China loans.

Taking the longer-term Chinese view, over the 20-year contract term, with deliveries of about 2.3 billion barrels, at annual value at this year’s price average of not less than $10 billion, and if the price average holds up, a full-term value of $200 billion, this $2 per barrel dispute ought to be something the two sides can agree to share — without going to a court in London and without damaging the windfall both are enjoying. If they can’t, the usually reticent Tokarev will no doubt have to explain to Putin why not.

Not surprised.  It would be very interesting to see those contract terms . . . somehow I think that if revealed, they would be more “colonial” than the PSAs (like the one for Sakhalin II) that Putin raged about in the mid-00s.

Speaking of oil, the Arbitrage Court has given BP the worst of all worlds: approval of the Rosneft-BP share swap, and the right to participate in Arctic exploration efforts–but only through TNK-BP.  So now TNK-BP and BP–and now Rosneft–will be the Siamese triplets from hell for the foreseeable future.  Good luck with that.  Be careful what you ask for, Dud: you might get it, and in this case you did.

Last, Dmitry Gorenberg (whom I will meet when on a panel speaking about blogging as an academic at the Association for Slavic, East European, and Eurasian Studies meetings in November) posted the editor’s introduction from the new issue of Russian Politics and Law.  Two of the articles by obvious Russophobes named Gudkov and Petrov present an analysis that is very similar to the natural state-based analysis I’ve presented on SWP over the last 4 years or so:

Lev Gudkov’s article on “The Nature of ‘Putinism’ ” judges Putinism to be a particular type of post-totalitarian authoritarianism in which the political police wields power on behalf of the private interests of bureaucratic clans or corporations. Furthermore, he argues that this system of power is not merely conservative but is designed specifically to block the development of the rest of society and to prevent its modernization. Control in this system is exercised by the security services, who seek to milk both the state and society for their own personal enrichment. [Emphasis added.]

Gudkov notes that this political system has a fundamentally different character from either the Soviet regime or a regular personalistic authoritarian regime such as that found in other countries. The new aspects of Putinism include its system for the legitimation of rule and its technology of power. Unlike Soviet-style totalitarian regimes, the Putinist political system is not a party-state, where the ruling political party has merged with the state. The regime also lacks an overarching ideology that seeks to justify its rule, nor does it engage in mass terror campaigns against political opponents. Furthermore, the population has partial freedom of access to information and the ability to engage in opposition activity as long as it does not threaten the ruling elite.

Unlike authoritarian states, the Putinist regime has a quasi-personalist and conservative character that focuses on restoring “Russian traditions” while engaging in ever-increasing corrupt activity. The personalism of the regime is particularly important, as Russia’s leaders have partially destroyed state institutions in order to cement their control of state power.

. . . .

The destruction of state institutions is the main focus of Nikolai Petrov’s “The Political Mechanics of the Russian Regime: Substitutes Versus Institutions.” Petrov argues that over the last ten years, Putin and his associates have eviscerated all state institutions except the presidency by systematically stripping them of any real power or purpose. What has been left behind are decorative institutions that appear to retain the powers of their former selves while actually performing few if any useful functions. The symbol of this transformation is the frequently cited remark by Boris Gryzlov, the Speaker of the State Duma, that the parliament is no place for political discussion. The substantive roles of both the Duma and the Federation Council have been handed over to various consultative councils, while the government itself as a decision-making organ was largely replaced by the presidential administration as long as Putin was president. Regional executives were, in turn, replaced by presidential representatives to the federal districts. The substitutions reached into the private sector, as well, with the replacement of independent large corporations with corporations controlled by the state and its top officials.

Petrov calls the system that results from this effort “highly managed democracy.” Its essential characteristics include strong personal power that is unlimited by institutions, the manipulations of public opinion through the mass media, and the holding of controlled elections. The consequences of building this type of government include excessive centralization, internal conflicts, inability to make decisions, and stagnation. These consequences in turn bring about a loss of flexibility and adaptability to changing circumstances on the part of the regime, followed by a gradual loss of effectiveness in governing. The system not only fails to react to crisis but also frequently causes its own internal crises because a lack of failsafe mechanisms prevents the authorities from realizing that they are making mistaken decisions. The crisis may come from a lack of resources to maintain the patronage system that keeps the government functioning, from an internal political conflict among members of the ruling elite that spreads beyond their ability to control, or from a local crisis that expands to engulf the whole country because of the leadership’s inability to deal with it.  [Emphasis added.]

While the system is designed to maintain the current leaders’ grip on power, in the long run, Petrov believes, it guarantees its own failure as hostility to the system gradually develops among the population. Because the public lacks the ability to change the system, anti government attitudes build among the population until they reach an “explosive” level that may bring down both the leadership and the entire system of highly managed democracy.

The last italicized portion is quite similar to arguments I’ve made here, arguments rooted in theory of the political economy of the natural state.

Personalization and de-institutionalization are quite detrimental to the country’s long run prospects.  Personalized, de-institutionalized regimes have little capacity for positive change and adaptation.  They tend to become ossified if the personal leadership ages in place (which is the most likely outcome in Russia), or instead become wracked by conflict and revolution if struggles over leadership erupt (which is the second most likely outcome in Russia).

I’ve downloaded the articles and will read with interest, and will report any additional interesting insights that I glean from them.

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  1. SWP, you should read Eric Kraus latest Truth and posting, where he has a nice interview with Russia’s Channel One. He points out (correctly) the danger that rather than succeed, all the monetary QE will simply fail and the sovereign collapse of the Eurozone’s weaker members, followed by Japan and the U.S., is the greatest economic threat to Russia’s weak recovery. What say you? While damning Russia’s dependency on selling raw materials and natural resources (ahem, would Texas or North Dakota be doing so well without Ag and natural gas to prop up their economies? Because it ain’ Intel that’s doing so) should you overlook that the greatest immediate threat to Russian economic and therefore political stability once again, comes from the West’s inability to control its monetary and fiscal diahrrea? (You had a stirring of that, anyway, when you agreed with Putin that the Fed is engaging in monetary hooliganism)

    Comment by pahoben lite — May 7, 2011 @ 6:09 pm

  2. @Pahoben lite–before you came around here (at least before you started commenting), during the crisis, I noted repeatedly that Russia is a high beta economy, meaning that it is more sensitive to global economic fluctuations than the average country. So the worst thing for Russia would be for us to go down. Definitely.

    I have been highly critical of QE2–before Putin was, in fact. My phrase–again from well more than a year ago–is “fiscal and monetary incontinence” (a little more polite than “diarrhea” 🙂 This is why I am extremely bearish. You certainly can’t say that I haven’t been hard on Bernanke, Geithner, and Obama. They, and the entire political class, is in denial mode, sleepwalking into the abyss.

    To repeat myself yet again: Bismarck said there’s a special Providence for children, fools, drunkards and the USA–we’ll need that. And we’re testing the limit of ruin there is in the country. Adam Smith says there’s a lot. We’re going to see how much a lot is.

    But back to your main point–if we go down, Russia goes down far harder. I ridiculed Putin at the beginning of the crisis in Sep 08 when he said Russia was immune. He may not say so now, but he realizes that Russia’s economic fate hinges on ours. And that eats at him.

    The ProfessorComment by The Professor — May 7, 2011 @ 9:05 pm

  3. The problem is that now even the presidency has been debased. At least Yeltsin had the good sense to retire. Putin is burning all bridges.
    Russian proverb. While the fat wither, the thin succumb.

    Comment by So? — May 7, 2011 @ 9:35 pm

  4. Very counter intuitively, treasury yields have fallen after S&P downgrading the US debt outlook to negative. Well, I know you don’t give much respect to what one of the “three stooeges” says…nonetheless both the bond market and S&P 500 seem to shrug off every single bad news……

    Of course the dollar is sliding w.r.t all emerging market currencies (except India which is deeply mired in corruption and what seems to be a big non performing loans problem). But that I think was the design of QE2 – which has turned out to be a competitive devaluation of the dollar to boost export growth. This has seemed to work thus far with US exports & manufacturing making some sort of a comeback. Central banks of emerging markets have struggled to slow down the resulting hot money inflows & the resulting inflation, but of late they have given up (esp. in Latam & China) and have reconciled to letting their currencies appreciate putting their exports at risk. Notably the talk of improving domestic consumption is being widely floated. But on the whole, it has turned out to be fine for the US – steady job growth & rising exports after QE2 inception. US treasuries have tested everyone’s patience, but still they remain the safe haven asset whenever there is any bad news.

    State and muni’s finance are in doldrums and this year is proving to be especially tough for state budgets. But this might be a blessing in disguise as they will be forced to implement cut backs that were long due. Muni yields haven’t really exploded despite several doomsday forecasts.

    But more importantly given the plethora of issues with every emerging economy (slowdown in China, corruption/non performing loans in India, massively inefficient state spending in Brazil, political/corruption issues in Russia, peripheral eurozone troubles) the US still surprisingly remains the economy that is the most investor friendly. So, Bismarck is gonna be correct once again!

    Comment by Surya — May 7, 2011 @ 9:40 pm

  5. @So? Re presidency, that’s one of the points in the Petrov article. Re thin/fat–don’t know at what/whom that’s directed. I could take it personally 🙂 But am I correct that your real meaning is directed at my reply to Pahoben Lite–i.e., that another crisis would be damaging to the fat US, but fatal to the thin Russia? If yes, point well taken.

    The ProfessorComment by The Professor — May 8, 2011 @ 6:19 am

  6. Yes.

    Comment by So? — May 8, 2011 @ 8:14 am

  7. So?–A man of many words, LOL!

    The ProfessorComment by The Professor — May 8, 2011 @ 1:53 pm

  8. “But that I think was the design of QE2 – which has turned out to be a competitive devaluation of the dollar to boost export growth. This has seemed to work thus far with US exports & manufacturing making some sort of a comeback.” Well, the trucks are backing up again at Laredo, and it did cost, when oil was $148 a barrel, four times as much to ship a typical container from the maquiladoras as from Shanghai. So to the extent that Ben Bernanke has a master plan to wage economic warfare against those devilishly clever yuan-undervaluing Fu Manchus in China and somehow have Uncle Sam come out ahead from destroying the dollar, that may be it.

    Still it doesn’t apppear even with plenty of automation all the manufacturing is coming back from Eastasia. Oceania has always been at war with Eur…er…Eastasia. Don’t forget to throw gobs of money at another dull, uninspiring establishment candidate like Romney or Daniels. Anything to save plutocracy, er an independent Fed, from that devil Ron Paul.

    Comment by pahoben lite — May 8, 2011 @ 5:45 pm

  9. SWP, As you’ve figured out, I’m more or less a Tea Partyer, and my only problem with this site and with most Tea Partyers in general as that they don’t connect the dots with the trillion dollars a year we’re spending on wars in Iraq, Afghanistan and now Libya (though Bachmann/Palin are coming around) and the two trillion Timmy! as you call him is asking Congress to raise the debt ceiling by before the end of this year. Ditto for whether we went to war to keep the Libyans recycling dollars rather than demanding gold dinars. The same theory existed about the Iraq invasion though switching to euros probably wouldn’t have affected the dollar then much at all. Demanding bulleon on the other hand for every barrel of oil, would pose a far greater threat to the global fiat currency order.

    It’s time to stop having it both ways. If America’s going broke, then so is our Empire. Only brother Ron and Gary Johnson seem to get that, though Palin and Bachmann might be tilting in that direction. Everyone else seems clueless or just wants to blame Obama for not bombing Libya more and just killing Ghadaffi already rather than starting the war in the first place on dubious humanitarian grounds. Before NATO intervened I don’t think more Libyan civilians had been killed in Benghazi than in Tskinval on the night of 08/07-08/08!

    Comment by pahoben lite — May 8, 2011 @ 5:53 pm

  10. Happy Victory Day SWP readers!

    Just remember, tyranny loving Russia saved the free world’s ass twice!

    Comment by Mr. X — May 8, 2011 @ 7:41 pm

  11. Mr. X,

    don’t you worry, the free world remembers how Russia first unleashed the destruction of WWII in cooperation with its Nazi allies and then brought its beloved tyranny to half of Europe for half a century.

    Comment by Ivan — May 9, 2011 @ 12:08 am

  12. ? ???? ??????!

    And let us not forget that it could not have happened without massive American assistance in the 1930s. Lend Lease was chump change in comparison.

    Johan, get over it. You lost.

    Comment by So? — May 9, 2011 @ 2:23 am


    August 23 commemorates the day when the Molotov-Ribbentrop Pact was signed, when Soviet Russia and Nazi Germany divided Eastern Europe between them, described by the European Parliament’s President Jerzy Buzek in 2010 as “the collusion of the two worst forms of totalitarianism in the history of humanity”.

    Comment by Ivan — May 9, 2011 @ 6:00 am

  14. ivan, you sound sooooooooooooo desperate.

    the soviet union won w.w. ii. face the facts.

    Comment by jennifer — May 9, 2011 @ 9:25 am

  15. Some SWP WWII theses:

    1. The USSR’s contribution was necessary to defeat Nazi Germany in WWII.
    2. The USA’s and the UK’s/Commonwealth’s contribution were necessary to defeat Nazi Germany in WWII.
    3. Neither the USSR nor the USA/UK would have been sufficient to defeat Nazi Germany in WWII.
    4. The people of the USSR made an unbelievable sacrifice during WWII, but many, many of the losses suffered were unnecessary and the result of blundering, criminality, or blundering criminality by the Soviet leadership. This was especially true June-November, 1941.
    5. Stalin’s cynical and paranoid policies contributed materially to the coming of the war, and to Hitler’s early victories over Poland and UK/France in 1939-1940. Indeed, it is likely that the war would not have broken out as it did and when it did, or unfolded as it did, without Stalin’s machinations. Stalin made Hitler all the more dangerous–and the Soviet people were among those who paid the greatest price for his policies.
    6. In 1933-1939, the western allies made incredible blunders that also bolstered Hitler greatly, thereby making war more likely, but those blunders were different in kind than Stalin’s. Stalin’s were part of an opportunistic policy intended to expand Soviet influence; the West’s mistakes were attributable primarily to timorousness bordering on cowardice.
    7. The USSR’s contribution to the victory over Japan was immaterial, and its intervention in the war was purely opportunistic.
    8. The USSR’s role in the post-War world was almost completely malign.

    I may add to the list, or amend it slightly. In the meantime: Have at it, folks!

    The ProfessorComment by The Professor — May 9, 2011 @ 12:33 pm

  16. An addendum to my theses: The primary impact the USSR had on the war in the Asia-Pacific theater was Zhukov’s battering of the Japanese at Khalkhyn Gol in Mongolia. This made clear that the “Northern Strategy” advocated by the Japanese Army was futile, and set in train the Southern Strategy favored by the Navy–and hence led to Pearl Harbor and the Japanese conquests in Indochina, the Philippines, the Dutch East Indies, Singapore, Hong Kong, etc.

    The ProfessorComment by The Professor — May 9, 2011 @ 3:52 pm

  17. Agree with all points and the addendum other than #2 and #3. AFAIK lend-lease didn’t really come into play to a significant extent until after Stalingrad. Without it the Soviets would have taken longer to win, and so Lend-lease probably saved 100,000s of lives of Soviet soldiers (not to mention sparing civilian lives by shortening the occupation) but I doubt it would have affected the ultimate outcome. Ultimately something like 80% of the German military was lost in the East. Even if I’m a bit off, and the USA/UK contribution was necessary to defeat Germany, it would have been necessary like the American contribution to World War I allied victory on the Western front (versus that of France and the UK combined)- the straw that broke the camel’s back rather than the main weight.

    Comment by PA — May 9, 2011 @ 6:55 pm

  18. @PA. It’s not AFAIK lend-lease that I was focusing on, although that was important: how would the Red Army have advanced without it? From 1942 onwards, the US/UK forces tied down and eventually destroyed large amounts of German men and materiel that could have had a decisive effect on the Eastern Front: even if it wouldn’t have permitted the Germans to win, it probably would have been enough to prevent the Soviets from pushing back the Nazis Even strategic bombing, which was probably not a wise investment on behalf of the western allies, tied down huge amounts of German men and aircraft and particularly AAA that could have made things far more difficult on the Soviets. Just think of the impact huge numbers of 88s could have had.

    The ProfessorComment by The Professor — May 9, 2011 @ 7:57 pm

  19. Lend Lease is overrated. But without the massive American aid in the 30s, it would have been just like a bigger version of the Polish campaign. Over in 6 months instead of 6 weeks.

    Comment by So? — May 9, 2011 @ 9:26 pm

  20. Found this on a discussion on another forum and it makes sense to me:

    Lend-Lease was very useful, but it probably was not
    decisive. For one thing, Lend-Lease deliveries were greatest in
    1944-45, when the Soviets were already on the offensive. Not very
    much (comparatively speaking) was delivered in ’42 (there was a long
    gap in deliveries to Murmansk after the PQ-17 debacle), and almost
    nothing in ’41, which was the decisive year for the E. Front.

    Even in January of 1945, Lend-Lease trucks comprised only 1/3 of Red
    Army’s truck park (about 200,000 out of 600,000 total), according to
    an article in the Journal of Slavic Military Studies, and raw number
    of Soviet-produced trucks in service steadily grew in ’42 and ’43,
    indicating that Soviet industry could and did replace losses in this
    area on its own. Presumably the same could be said for telephone
    wire, etc. However, the Lend-Lease definitely did accelerate Soviet
    recovery and reduced the lulls between Soviet offensives from ’43
    onwards by helping them replenish their forces faster than they could
    have on their own.

    You also have to keep in mind than already by spring of ’42 the
    Soviets’ strength had improved relative to the Germans’. While in ’41
    the Wehrmacht launched three simultaneous strategic offensives into
    the USSR, its losses in Barbarossa meant that in ’42 it could manage
    only one (1.5 if you count the push into Crimea). The offensive into
    the Caucasus was successful largely because the Soviets initially
    thought it was a feint, designed to draw away forces from the central
    front, protecting Moscow. I doubt whether the Wehrmacht would have
    had as much success had they attempted another push on Moscow in ’42,
    which is what the Soviets expected them to do. And all of this was
    happening while US and British strategic bombing was barely getting on
    its feet and while N. African campaign was absorbing a tiny proportion
    of German assets. In short, Soviet survival in ’41 and ’42 is mainly
    a Soviet accomplishment.

    In “When Titans Clashed: How the Red Army Stopped Hitler” by David
    Glantz, Colonel, U.S. Army (ret), Lend Lease is described as
    materially assisting the Soviet war effort, but not in a way that was

    He concludes:

    “Left to their own devices, Stalin and his commanders might have taken
    12 to 18 months longer to finish off the Wehrmacht; the ultimate
    result would probably been the same, except that Soviet soldiers could
    have waded at France’s Atlantic beaches.” (pg 285)

    @19 – the reason the Poles fared so badly against the Germans was because most of their militasry was tied up right at the German border (defending Silesia, etc.) and thus easily surrounded and destroyed. When the Poles were operating with some depth they did much better vs. the Germans than they did overall (the Bzura battle). But you make a very good and interesting point.

    Comment by PA — May 9, 2011 @ 10:19 pm

  21. > the soviet union won w.w. ii. face the facts.

    the soviet union also started w.w. ii in close cooperation with its nazi allies. face all the facts, not just the ones trumpeted by soviet propaganda.

    Comment by Ivan — May 10, 2011 @ 3:44 am

  22. In a cold and savage way, yes, Lend-Lease had no effect on the eventual outcome of WWII, because Stalin was willing to sacrifice every living soul in the USSR, irrespective. So, from that perspective, Stalin would have continued to use the “ants-overcoming-the-giant” approach until the Red Army had reached Berlin. This, of course, would have resulted in ~ 50 million dead instead of the 26+ million that perished. But, the USSR would have had its pyrrhic victory, as it did, one way or the other.

    Comment by Dermovov — May 10, 2011 @ 3:51 am

  23. The USSR won WWII?? Hmmm, odd then that (1) the USSR doesn’t exist any more, while Germany is reunited and (2) Germans live 15 years longer than Russians on average and (b) Germans have $30,000 per person more annual wealth than Russians.

    If the USSR “won” WWII then we’ll take losing any day of the week!

    Comment by La Russophobe — May 10, 2011 @ 5:21 am

  24. “this system of power is not merely conservative but is designed specifically to block the development of the rest of society and to prevent its modernization”

    We too have been propounding that theory for years now, SWP. It’s the central feature of the Putin dictatorship, that it can’t afford to allow Russians to be healthy, wealthy or wise, because if they were they’d challenge for power. Same principle organized the USSR, and since it was full of sick, poor stupid people it naturally collapsed. Same thing will happen to Russia but, just as with the USSR, there be much pain and misery inside and outside the country before it does.

    Those who cannot remember history are doomed to repeat it until they destroy themselves absolutely.

    Comment by La Russophobe — May 10, 2011 @ 5:25 am

  25. LaR,

    Thanks for pointing out the magnanimity of the Soviet Union. To the Germans victory meant conquest. To the Russians survival.

    Comment by So? — May 10, 2011 @ 6:49 am

  26. @SWP:

    Your point (2) says that the USA and the UK efforts were the last straws that broke the camel’s back, right? 🙂

    Comment by Ostap Bender — May 10, 2011 @ 1:21 pm

  27. LR wrote: “The USSR won WWII?? Hmmm, odd then that (1) the USSR doesn’t exist any more

    So what, you genius? The Roman Empire doesn’t exist anymore, but it sure won many wars while it existed.

    The reason why USSR doesn’t exist is because the leaders of Russia, Ukraine and other Soviet republics decided that it would be to their advantage to be 15 separate states, and peacefully divorced each others. And now Russia and the Baltics are doing economically much better than they were before the divorce. So, Russia is a winner of the break-up of USSR.

    While Germany is reunited

    Nope, you are ignorant. Only part of Germany is reunited. Much of Germany now belongs to Russia, Poland, Lithuania and Czech Republic. Forever! I know you don’t know this, but look it up.

    That’s why Russia is the winner, and Germany – the loser.

    If the USSR “won” WWII then we’ll take losing any day of the week!

    What do you want to lose first? Konigsberg/Kaliningrad, Silesia, Dantzig/Gdansk, Memel, or Sudetenland? Or all of them?

    Comment by Ostap Bender — May 10, 2011 @ 1:33 pm

  28. @Ostap. Uhm, no. The USSR was in need of far more than a straw to break Hitler’s back.

    The ProfessorComment by The Professor — May 10, 2011 @ 4:21 pm

  29. @Dermovov–well, I agree that Stalin would have fought to the last Russian/Ukrainian/Tatar/whatever. I don’t necessarily believe it would have been enough to result in Berlin in ruins and Hitler a suicide. More likely, a stalemate somewhere between Smolensk and the Polish border.

    The ProfessorComment by The Professor — May 10, 2011 @ 4:23 pm

  30. I find it interesting that people who discount Lend Lease always state that Lend Lease didn’t materially contribute to the Red Army until after the Battle of Stalingrad, when it is just at that time that the war on the Eastern Front went through a very dramatic change. In 1941-1942, the war had a pattern of a spring/summer period of massive Nazi success that inflicated horrible casualties to the Red Army to a period of Nazi overstretch that made them vulnerable to an unexpected Red Army counter attack that would bog down as the Nazis regrouped. Soviet successes really depended on the Nazis underestimating Red Army reserves that created a situation where a well planned counter attack would succeed. Without that faulty German planning at the end of their offensive, the Red Army consistently lost. In the 1943 and afterwards, the Red Army held any German attacks or counter attacks and proceeded forward. Doesn’t it make sense that Lend Lease had something to do with the changes in operational success of the Red Army before and after?

    Most Lend Lease goods were not sent by the arctic route, so the disaster with Convoy PQ-17 was not decisive. Most Lend Lease was delivered through Iran in the Indian Ocean and (suprisingly) across the Pacific to Vladivostok because Japan would not attack ships bound for Russia due to the Soviet-Japanese non-aggression pact.

    Lend Lease provided the radios installed in Russian made tanks, and the phone wire so Red Army HQ could talk to their troops. Without being able to communicate to the troops in the field, it would have been very hard for the Red Army to successfully implement their operations. The HQ would get delayed intelligence reports, orders couldn’t be changed if necessary, and it would be harder to coordinate soliders. Lend Lease provided millions of canned foods for the Red Army soldier to eat. With most of the Soviet breadbasket occupied by Germans, how exactly was the Red Army supposed to feed itself? Lend Lease provided those trucks, railway tracks, and other transportation equipment vital to keep the Red Army supplied. How could they attempt to exploit their victories if the soldiers had to stop advancing so that they could remain supplied? What about the millions of boots supplied for their soldiers? I think something like 18% of all aircraft were provided by Lend Lease. Isn’t that greatly responsible for the Red Army’s ability to have air superiority for much of the later part in the war (especially when combined with the Western bomber offensive)? The Red Army in 1941-1942 often has shortages of the most basic equipment. Yet we don’t hear of anything like that in 1943 onwards. If Lend Lease isn’t responsible for that, what was?

    And besides the explosives, small arms, vehicles, and other obvious war materials sent, there were plenty of machine tools, chemicals, petroleum, aluminum, rubber, and other vital raw materials for Soviet industry so that the USSR could manufacture its own items. Many of the machine tools sent were of the precision or highly technical type that Soviet industry could not make well, and were very dependent on the West to provide. How many Soviet factories would have been idle without that (especially in 1941 and 1942), how many Soviet made items would not have been made? What would have been the implications of that? And for some of the basic commodities given that were absolutely essential (like boots), how many workers would have been diverted to make those, and what couldn’t they have made? How many soldiers might have to be released so they can work in the factories?

    And of course, there are all sorts of odd scenarios which is hard to state with certainty, but must have some impact. What critical engagement or battle would not have been fought if not for Lend Lease? For just one example without the food and other materials delivered in Murmansk, how many supplies could have reached Leningrad during the siege? Would it be enough that Leningrad could have fallen, thus freeing up German troops to be deployed elsewhere? Even what small numbers of tanks, planes, etc. that were delivered in 1941 and 1942 were crucial. The Soviet Union had lost most of its armor and aircraft in Barbarossa. When the Moscow counterattack happened, I think somewhere between 15-25% of tanks and planes were Lend Lease (British and American) help. Wouldn’t losing 1/4 of your hard assets significantly hurt the Soviet offensive? If you are going to make up that loss by stripping another section of the front of their assets, what happens there? Do the Germans hold Rostov in 1941? Do they get the entire Donets Basin? If so, how does this affect Case Blue in 1942?

    And of course, there is the morale issue. If the Soviet Union truly is alone and getting no aid, what happens to the individual soldier in the Red Army? Are they going to be more stoic than their fathers and grandfathers in 1917 in a similar situation without getting needed supplies to fight well?

    No Lend Lease in 1945 would not have affected the war much. No Lend Lease in 1944 would mean a long war on the Eastern Front. No Lend Lease in 1943 or earlier would probably critically affect the Red Army though. How good would the troops at Kurks be if they were hungry, still having to share weapons, no radios in their tanks or cable wires for field telephones, and not enough trucks and jeeps to keep them supplied for an offensive? How many of the land mines planted were dependent on explosives manufactured in the US?

    Glantz is an excellent historian, but I think his idea that the Soviet Union could have defeated Nazi Germany alone and only needing 12-18 more months is not supportable (especially if he means no involvement by the West at all. Hitler is going to be able to get a lot of critical war materials he needs without a British blockade). Soviet Union would certainly have survived without Lend Lease. Victory (alone) is much more debatable. Most likely a stalemate and a negotiated peace. And if the Western Allies fight, but don’t give any aide, then the two armies meet up at the Vistula or farther east. Especially considering that the Soviet Union was nearing the end of its manpower reserves when Berlin fell, I’m not sure an extra 12-18 months were actually sustainable, especially alone.

    Survival with minimal Lend Lease in 1941 and 1942 does not mean that the spectacular Red Army victories in 1943 and 1944 are going to happen without Lend Lease. There is a huge difference between triumphal marching in Berlin and a bitter stalemate along the Dnieper.

    Comment by Chris Durnell — May 10, 2011 @ 6:31 pm

  31. I’m with you Chris. I think at best, no Lend Lease, stalemate. After all, the balance was still close enough in July 43 that Hitler could launch Citadel. (A big mistake, but still an indication that even post-Stalingrad it wasn’t over. Like those who think the American Civil War was effectively over after Gettysburg and Vicksburg. Not really.)

    When you think about the effects of Lend Lease, think of the old adage: “Amateurs talk tactics, professionals talk logistics.” The Soviets would not have had the logistical capability to advance as far and as fast as they did w/o LL. And if you think of the million + men, the aircraft, the armor, and the industrial production that Germany could have used on the Eastern Front absent a threat from the western allies, it becomes highly doubtful that the USSR could have won a decisive victory.

    The ProfessorComment by The Professor — May 10, 2011 @ 6:50 pm

  32. one of the counter points is that talking about lend lease downplays the eternal sacrifice that the soviet soldiers made to save their country, their women, and their country.

    and, yes, it was save. like So? implied, soviet defeat would have resulted in the extermination of russians, slavs, and jews from the eurasian continent.


    Comment by jennifer — May 10, 2011 @ 7:44 pm

  33. Lend Lease was very limited in ’41-’42 because there was a high likelihood of it ending up in German hands. Of course, the most import “Lend Lease” happened in the 30s. Yet another Roosevelt “crime”.

    Comment by So? — May 10, 2011 @ 8:06 pm

  34. No Jennifer, trying to give a balanced appraisal of the contribution of each combatant or the effect of policies such as lend lease is not downplaying the eternal sacrifice of anybody. Nobody disagrees what the consequences of a Soviet defeat would have been.

    The ProfessorComment by The Professor — May 10, 2011 @ 8:27 pm

  35. Now, now. Generalplan Ost was somewhat of an exaggeration. (Propaganda – everybody does it.) The only ones slated for extermination were the Jews. And no-one likes them anyway. After all, Hitler did offer half a million Hungarian Jews to the Allies at $2 per head, but the offer was declined. WRT the rest, the plan was to assimilate some, “displace” others (the closer to Germany proper, the more likely), put some on a diet and use the rest as labour. Someone has to toil in the fields and mines after all.

    The topic of the final essay exam in 1946 was strange. “If the Germans had won?”. Victor P. tried with all his imagination and his pen started squeaking. Alas, a long list of monstrous absurdities was the result. Such a Russia could not possibly have happened. After all, the Germans had lost in the end.

    1. Almost no industry left. The occupiers will only be concerned with pumping the natural resources of our territories.
    2. Instead of having a militia, the policemen will be recruited from the rabble. The police will be very many, and the people will fear them more than the criminals.
    3. At every exit from the city police will check those gathered to leave or arrive. Each resident will be required to register with the police in the community.
    4. To maintain the fear, they will create teams of wild mountain people. They will occasionally attack the local population, to rob and kill.
    5. The local administrators will be chosen from the worst locals. For safety, their children and wives will live abroad. And they will take turns here on a rotational basis.
    6. The elite will use only black German cars with sirens for transport. Ordinary people will have to stay out of their way and wait until they pass.
    7. Out of total despair, the state ideology will eventually become fascism. Only the Russian version.
    8. German goods will be considered in Russia, the best and most desirable.
    9. President will speak much better German than Russian.
    10. Instead of vodka, beer will be sold and promoted. As in Germany.
    11. Those who fought against the Germans, will receive a pittance, and meager presents on public holidays.
    12. Russians killed in the war will be buried in mass graves, only as a token of their passing.
    13. Most of the male population will pass through camps to break their will to resist.
    14. Teachers and doctors in the occupied territories will receive minimum pay, so the population shrinks and degenerates as quickly as possible.
    15. On the distant outskirts of Russia, like Primorskiy Krai, there may still be partisans. They will attack the policemen, but the intimidated local population will give them no assistance.
    16. Road construction will stop, and fuel will be expensive, so that the people stay at home.
    17. Firearm ownership will be strictly forbidden.
    18. People will live in cheap barracks with low ceilings. 8 square metres per person.
    19. The smartest and most capable will be allowed to leave and live abroad. This would be considered a great success in life.
    20. America will be declared Russia’s main enemy.

    Vera Pavlovna pondered on the grade. And gave him 3 for a good fantasy.

    Comment by So? — May 10, 2011 @ 9:17 pm

  36. @The Professor Uhm, no. As I recall, USSR was responsible for almost 80% of all killed German soldiers and destroyed German tanks and planes. UK and USA – for less that 15%.

    Comment by Ostap Bender — May 11, 2011 @ 4:03 pm

  37. @36 The 80% also likely underepresents the toll the Soviet forces took, because from what I have heard the Germans tended to send the best soldiers and most modern equipment to the Eastern front (where their situation was more critical) while the 20% fighting the western allies were more poorly equipped, older or too young, “resting”, etc. Although I doubt it, it may be possible that if these were also thrown against the Soviets that would have been enough to tip the struggle in favor of the Germans. In which case, if Western efforts vs. Germany were not a straw breaking the camel’s back, they were no more than a pillow.

    Chris’s comments re: Lend Lease seem to make sense and are certainly possible, although I’m not sure Stalin would have accepted a cease fire on the Dnieper rather than throw more Soviets into the meatgrinder until he achieved victory – and he had a much larger population to work with than did the Germans.

    Comment by PA — May 11, 2011 @ 9:15 pm

  38. “The Great War” is WW1 in Britain, WW2 in Russia.

    Comment by So? — May 11, 2011 @ 9:47 pm

  39. Get it straight, Russia lost World War II.

    Comment by La Russophobe — May 12, 2011 @ 11:53 am

  40. @La Russophobe:

    No matter how many times you repeat your mantra, it will not become any more illogical. If the current GDP is the measure of who won WWII, then the winner was Qatar, which has the highest per capita GDP PPP at $145,300 per person.

    1 Qatar $ 145,300
    2 Liechtenstein $ 141,100
    3 Luxembourg $ 81,800
    4 Bermuda $ 69,900
    5 Norway $ 59,100

    Comment by Ostap Bender — May 12, 2011 @ 4:05 pm

  41. OSTAP:

    Everyone with a brain thinks nations with high per capita GDP are winning and those with low GDP are losing. Americans worry about high PCGDPs in other countries all the time. Only Russians are ignorant enough to rationalize or ignore such data.

    All the countries on your list are tiny and never devastated by war and as such comparing them to Russia and Germany is the statement of a drunken, ignorant, inbred moron who cannot put down his crack pipe.

    Ignoring all the other points in our article (like Russia’s short life expectancy) is even more utterly stupid and ridiculous.

    The USSR and Germany fought a war and after that went on absolutely opposite paths of success and destruction. If you “think” the war had nothing to do with that, then you must believe Germans are inherently superior beings to Russians. Such anti-Russian racism is appalling and if you adhere to it, you are beneath contempt.

    Comment by La Russophobe — May 12, 2011 @ 7:44 pm

  42. Russians can never win.

    Comment by So? — May 12, 2011 @ 8:22 pm

  43. > Russians can never win.

    Not if they remain under tyranny of a fascist regime under whatever disguise du jour, no. But they can still persuade themselves that slavery is a great accomplishment and feel happy. Has been working for centuries. Can’t be that bad. Probably.

    Comment by Ivan — May 13, 2011 @ 4:49 am

  44. @LR Too bad that you are not intelligent enough to understand that being wealthy and winning a war 65 years ago is not the same thing. Had there been no WWII, Germany would still be much wealthier than Russia, Baltics and other ex-USSR republics.

    Comment by Ostap Bender — May 13, 2011 @ 4:19 pm

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