There
is a serious issue at the core of the USA-Russian renewed Cold War. Both sides
fail to understand how and why the Cold War ended. This is a profound problem
that impacts both Russian and Western attitudes risking war in the future. This
very common assumption that the West somehow succeeded in causing the
collapse of the Soviet Union winning the Cold War is DEAD WRONG. The plain and simple fact is that the Cold War ended
by its own accord not even by negotiation to the advantage of both sides, but
because of sheer economics.
The
reason I state that Marxism and Socialism are collapsing is because central
planning simply fails to work. Only people in the front line of commerce see
gaps and openings that present opportunities that inspires innovation and
economic expansion. This is the true thrust behind Adam Smith’s
Invisible Hand. This is why the Soviet Union collapsed. It was NOT some CIA plot and it is what
is currently behind the fall and decline of Western Economics.
Back
in December 1989 Malta summit that lined up precisely with our Economic
Confidence Model and our forecast that Communism would then fall, was the
Mikhail Gorbachev and President George H.W. Bush confirmed that the ideological
basis for the war had evaporated into history. They acknowledged that the two
nations no longer regarded each other as enemies – something Putin & Obama
need to remember.
Over
the next two years, The United States and the Soviets worked closely together
in a new spirit that was even tighter than with even some of other allies. The
USA and the Soviet Empire worked to actually halt the arms race and went on to
ban chemical weapons while agreeing to drastically reduce nuclear weapons. The
old Iron Curtain was being abandoned and this conference did more to solidify
the collapse of Communism in Russia but also China. The liberation of Eastern
Europe was at hand. While Putin had regarded the collapse of the Soviet Empire
as the greatest tragedy of the 20th century, this is purely seen through biased
eyes of power – not economics.
This
was the voluntary abandonment of communism and its central planning ideology by
the Soviet leader who some see as a traitor today in Russia – Mikhail
Gorbachev. However, without the Arms Race consuming resources within the Soviet
economy preventing economic expansion and the lifting of living standards in
Russia, Gorbachev understood he could now make his country economically strong
once freed from the Arms Race in a war that no longer made economic sense and
that would allow him to then focus on internal reforms.
Gorbachev’s Perestroika (“restructuring”)
(Russian: перестро́йка)
was the political movement for both the reformation within the Communist Party
of the Soviet Union and his glasnost
(“openness”) policy reform. The interesting aspect is that Perestroika began with the
major shift in the Economic Confidence Model in 1985 from PUBLIC to PRIVATE. Perestroika became
a well-known term by 1986. This was Gorbachev’s goal – his economic rationalization
that Perestroika was
critical to the long-term survival of Russia. This was the restructuring of the
Soviet political and economic system. The hard-liners blame Perestroika for the cause of
the dissolution of the Soviet Union, the revolutions of 1989 in Eastern Europe,
and the end of the Cold War. However, our model successfully targeted the
beginning of Perestroika with
the turn in 1985 and the collapse of Communism on the peak of the first wave –
1989.95.
The
relaxing of the iron grip of Eastern Europe set in motion a cascade failure
that resulted in the collapse of the Soviet Union in a rapid fashion
traditionalists did not expect. Only our model saw the rapid demise for this
was simply how all empire, nations, and city states collapse – in less than 3
years with the greatest pressure in the first year. The borders became porous
south of Germany and this led to several weeks of civil unrest that forced
the East German government to announce on November 9th, 1989 that all GDR
citizens could visit West Germany and West Berlin. Crowds of East Germans
crossed and climbed onto the wall, joined by West Germans on the other side in
a celebratory atmosphere. Over the next few weeks, a euphoric public and
souvenir hunters chipped away parts of the wall; the governments later used
industrial equipment to remove most of the rest. The physical Wall itself was
primarily destroyed in 1990. The fall of the Berlin Wall paved the way for
German reunification, which was formally concluded on October 3rd, 1990.
This
rapid demise of the Berlin Wall and the Soviet Union has confused those in
Russia who see it as a CIA plot and Americans who just want to take political
credit for ending the Cold War. Nevertheless, neither side deserves any such
credit for this was simply an inevitable outcome of economics.
Moreover,
the breakup of the Soviet Union into 15 separate countries was not something
the America caused, could foresee, or even plot on a white board as a goal. It
was expected that Gorbachev would create a type of voluntary union of Soviet
republics that mimicked the United States – excluding of course the main three
Baltic countries where they simply hated Russia for the persecution of Stalin.
President
Bush actually expressed this American political expectation in August 1991 when
he urged the non-Russian Soviet republics to adopt the union treaty Gorbachev
had proposed and warned against “suicidal
nationalism.” Clearly, the political goal was to keep the
Soviet Union together and NOT to
see it collapse for the great unknown would emerge – would there be nuclear
weapons unaccountable? So to those who claim the collapse of the Soviet Union
was plot crafted by the CIA, they are out of their minds for the greatest fear
was who would then control the instruments of death. This is why Bush counseled
AGAINST separatism.
Russians
who regret the collapse of the Soviet Union should remember that it was not
Gorbachev, but Boris Yeltsin who actually conspired with his Ukrainian and
Belarusian counterparts to replace the U.S.S.R. with a loose and powerless
“commonwealth” and Ukraine turned over all of its nuclear weapons. This was the
REAL backdrop to why Ukraine is
unarmed today.
Gorbachev
maintained that “the end of the Cold
War is our common victory.” Nevertheless, there were deep
division within the political structure within the Soviet Union that did not
approve of ending the Cold War and saw the USA still as the enemy. At the same
time, there was rising political unrest in outer Soviet Republics. 1990
began with nationalist turmoil in January as the Azerbaijanis rioted and troops
were sent in to restore order, then many Moldovans demonstrated in favor of
unification with post-Communist Romania. Lithuanian demonstrations also erupted
a continued progressively. That same month, Armenia asserted its right to veto
laws coming from the All-Union level, starting the dissolution process
intensifying what became known as the “War
of Laws” between republics and Moscow. This was the uprising against the
central control of the Marxist state.
Then
in 1991, there was the Soviet coup
d’état attempt, also known as the August Putsch or August
Coup (Russian: Августовский путч Avgustovsky Putch), that was
organized by a group of members within the government to take control of the
country from Mikhail Gorbachev. The coup leaders were indeed the hard-line
members of the Communist Party who were opposed to Gorbachev’s reform program
and the new union treaty that he had negotiated which decentralized much of the
central government’s power to the republics. This political design was more or
less similar to the structure of the United States with independent state
rights, just a central federal power. The Soviet model was all power resided in
the central government and that is what prevented Russia’s economic growth.
The
coup leaders were opposed primarily within Moscow itself, by a rising tide of
civil unrest among the people. The coup collapsed in only two days and
Gorbachev returned to government. However. this event had the impact of
destabilizing the Soviet Union and contributed to the demise of the of the
communist party (CPSU) and then inspired the full dissolution of the Soviet
Union. This was accomplished by the Russian people – not the CIA. The Baltic states then seceded in August 1991
starting the process.
Boris
Yeltsin (1931–2007) was a Russian politician who stood on the tank during the
civil unrest insisting the army not fire upon Russians. He then emerged as the
first President of the Russian Federation, serving from 1991 to 1999. He had
been a supporter of Mikhail Gorbachev initially, but he then emerged under
the Perestroika reforms
as one of Gorbachev’s most powerful political opponents. Yeltsin was elected on
May 29, 1990 as chairman of the Russian Supreme Soviet. On June 12, 1991 he was
then elected by popular vote to the newly created post of President of the
Russian Soviet Federation Socialist Republic (SFSR). At this moment in time,
this was composed of the 15 constituent republics of the Soviet Union. In
the aftermath of the coup, his rival Yeltsin quickly worked to consolidate his
hold on the Russian government as well as the remnants of the Soviet armed
forces, paving the way for Gorbachev’s downfall.
Gorbachev
had aimed to maintain the CPSU as a united party. He in his mind sought to
create a Scandinavian-style social democracy. However, when the CPSU collapsed
with the August ’91 coup, Gorbachev was left with no effective power base
beyond the armed forces. The movement within the Republics for economic freedom
was building. Then on December 12th, 1991 it was becoming apparent that the
momentum towards dissolution could not be stopped by anyone. This is why Bush
came out counseling against the break-up of the Soviet Union
supporting Gorbachev.
It
was at this time when Gorbachev began to hint that he was considering stepping
down. Then on December 17th, Gorbachev accepted the fait accompli and reluctantly
agreed with Yeltsin to dissolve the Soviet Union. Four days later, the leaders
of 11 of the 12 remaining republics had ALL, with the exception of Georgia, signed
the Alma-Ata Protocol
which formally established the CIS. They also preemptively accepted Gorbachev’s
resignation. When Gorbachev learned what had transpired, he told CBS that he
would resign as soon as he saw that the CIS was indeed a reality.
On
the night of December 25th, 1991, in a nationally televised speech, Gorbachev
announced his resignation as president—as he put it, “I hereby discontinue my
activities at the post of President of the Union of Soviet Socialist
Republics”. The Soviet Union was formally dissolved the following day. Two days
after Gorbachev left office, on 27 December, Yeltsin moved into Gorbachev’s old
office.
Yeltsin
remained in office as the President of the Russian Federation, the USSR’s
successor state. Yeltsin was reelected in the 1996 election; in the second
round he defeated Gennady Zyuganov from the revived Communist Party by a margin
of 13%. However, Yeltsin never recovered his early popularity after a series of
economic and political crises in Russia in the 1990s and corruption that was
becoming obvious.
Yeltsin
vowed to transform Russia’s socialist command economy into a free market
economy and implemented economic shock therapy, price liberalization and privatization
programs. However, the state-owned property merely went to political favorites
in the privatization process and much of the national wealth fell into the
hands of a small group of oligarchs rather than the public.
Much
of the Yeltsin era was marked by widespread corruption, inflation, economic
collapse and enormous political and social problems that affected Russia and
the other former states of the USSR. Within the first few years of his
presidency, many of Yeltsin’s political supporters turned against him and Vice
President Alexander Rutskoy denounced the reforms as “economic genocide”.
Today,
there remain elements within the United States who insisted upon treating
Russia as the loser and that is now remembered by Putin. George Bush did not help
matters when he sought to exploit the situation for domestic political gain. He
stated at his 1992 State of the Union address; “By the grace of God, America won the Cold War.” The next
three Presidents took those words to heart and treated Russia as a loser rather
than understand it was economics and not the sheer power and might of the USA
political establishment.
The
US started to become more aggressive rather than wise. President Bill Clinton
supported NATO’s bombing of Serbia without U.N. Security Council approval. He
championed the expansion of NATO to include former Warsaw Pact countries moving
right into the face of Russia. Such moves clearly violated the understanding
that the United States would remain restrained and not take advantage of the Soviet
Union’s contraction retreat from Eastern Europe. The effect on Russians’ trust
in the United States was devastating. In 1991, polls indicated that about 80
percent of Russian citizens had a favorable view of the United States; in 1999,
nearly the same percentage had an unfavorable view all because of the
aggressiveness of US power.
In
1999, based upon information and belief, Edmond
Safra, and his buddy Boris Abramovich Berezovsky schemed to takeover Russia and get their hands on
its natural resources. Yeltsin
had announced he would run for election in 2000. There was $7 billion stolen
from the IMF loans that was directed to Switzerland to “refurbish” the Kremlin.
As soon as the wire was delivered by Bank of New York, Safra’s Republic
National Bank ran to the US Attorney informing them that Bank of New York just
did a $7 billion money laundering scheme. They then black-mailed Yeltsin into
not running and demanded he appoint Berezovsky as President or they would tell
the world he just stole $7 billion from the IMF. Yeltsin realized he was set-up
by Safra and this is when he turned to Putin. Safra mysteriously was killed on
December 3rd, 1999, Berezovsky fled to London and Putin came to power.
The
United States and Europe have lost and created in the process a resentful
Russia that now confronts the world. Their mismanagement of the entire
situation and the lack of understanding of the issues central to this crisis
plagued our perspective of the future.
Source: http://armstrongeconomics.com/2014/03/18/the-us-did-not-cause-the-fall-of-the-soviet-union-that-is-a-false-belief-on-both-sides/ Posted
on March
18, 2014 by Martin Armstrong
Comments:
In 1979, I was
Corporate Personnel Mgr. for Rickel Manufacturing Company in Salina
Kansas. We designed and manufactured
high-flotation fertilizer applicators. We had sold these to Russia in past
years. We got a call from our Russian customer
that they were interested in our newest units and that prompted a trip. It looked like the Russian economy was on its
last legs. They had no resources. They had tried to copy our design, but couldn’t
get it to work. We were amazed by their
openness about their attempts at patent infringement, but they were clearly
incapable of attempting it again. We sold
them some new equipment and got paid in a dock-side COD agreement in dollar
rubbles and gold. We forfeited some of
our profit with travel expense, but the education was worth it. From my experience, the article above sounds
100% true to me.
Norb Leahy, Dunwoody GA Tea Party Leader
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