Do we have capitalism in Putin's Russia?

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meerov21
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Mar 10 2016 00:00
Do we have capitalism in Putin's Russia?

I am not sure that such countries as Russia or Assad's Syria, or Ukraine of Yanukovych are (or were) fully capitalist states.

The state controls about 70% of the Russian economy according to the IMF, and 60% according to some other estimations. However, within the state there is a narrow group of persons with criminal roots (they were connected with mafia from the cities of Tambov and St. Petersburg) and at the same time, with roots in KGB. They controls the whole pyramid of power and money.

This strange alliance was formed in the 90s of the last century, during so-called "Great criminal revolution". It was a time when criminal organizations were merged with the security forces of the state and become owners of business and, at the same time, were engaged in extortion of money from business.

They are unofficially called "Cooperative Lake" because of the name of organization, which has gained for them the land for construction of country houses in the past. There are about 60 people.

There are about 60 people. This is the highest oligarchy with the past of gangsters and criminal thinking. It is the same thing as if Al Capone had become President of the United States and at the same time he and his friends from Cosa Nostra had controlled the court, police, army, media and state companys that produce 70% of GDP.

Also even big businessman is nothing more than a clowns in the hands of these people. They "tilted" business and this word in the modern Russian language means at the same time squeezing money (racketeering) and sexual humiliation. This definition fully reflects psychology of the higher power and it is used in the confessions one of the highest authorities. Any businessman could be jailed if he did not give them the required sum of money.

In other words, people from the higher echelons of power are at the same time the largest owners and the biggest gangsters. In some sense they own everything in the country.

This elite is not monolithic. There are conflicts among its representatives. Some of them control powerful state agencies. Putin plays the role of the regulator. They call him "Dad". Below this elite different groups exist and operate, but they all obey the highest echelon.

Law does not exist for them. They can do anything whatever they want. Principles of bourgeois law, created by the French revolution is not functioning in Russia. Yes, it's a dictatorship. But is this bourgeois dictatorship, if private property is not protected? In the same time according to the estimates of Russian economists from 40 to 60% of the state money is stolen regularly.

Political and economic interests cannot be separated here. The same people have the highest power and wealth like the emperors of China Yin-Shang era.

However, unlike the ancient Chinese, we do not live in small rural communities, providing themselves with food. We live in big cities and are employed in offices or factories.

And yet such a society reminiscent of some pre-capitalist countries, such as absolutist France or some Eastern despotism where the economy was dominated by state ownership.

From another side Russia is the part of global economy. Russia is a gas and petrol station of the European Union and the best investor of petrodollars to EU economy. Half of the Russian exports go to Europe (oil, gas and other raw materials). 70-80% of demand of Russian industry are foreign and largely European goods (machines and other equipment). 50% of food is imported. 93% of Russian medicines are either produced abroad or contain foreign components. The largest Russian companies and banks total debt to western foundations is $ 600 billion. Russian state is totally dependent on Western technologys, and 50% of the income of the Russian budget comes from oil and gas exports. If energy prices falling Russian budget collapses.

But here's is a question againe. Was or was not capitalism in such place as British India?

What transitional forms between capitalism and other types of society can exist? Can we consider the capitalist society in which 70% of GDP is produced at the state-owned enterprises, the same people are concentrated in theier hands higher power and property, and where there is no bourgeois property rights, ownership?

... Such terms as capitalism, feudalism, bastard feudalism, illegal feudalism, oligarchical collectivism or Asian mode of production does not explain everything. It is important to understand exactly how this society operates. It is doubtful that the king-sun Louis XIV was subordinated to the interests of the French bourgeoisie...

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Khawaga
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Mar 10 2016 00:06

If there is wage labour, commodities are exchanged for money, people are dispossed from the means with which they need to reproduce themselves, then it is capitalism. Sure, it has different flavours, but the core of it stays the same.

meerov21
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Mar 10 2016 08:46

Capitalism is an economic system of production and distribution, based on private property, General legal equality and freedom of enterprise. The main criterion for making economic decisions is the desire to increase capital, earn a profit. This is the definition from the dictionary.

People can argue about the definitions.

But In any case, capitalism is associated with the investments, when most of the profit is invested in production.

Why should I invest in real production or trade and develop company if effective big company will be taken forcely by people associated with the government? They are called "raiders".

Also In Russia property is not protected. So for Russians the main incentive is not profit, but obtaining power in the state.

And I can not understand, how can there be capitalism if it is based on private property.

If the President Al Capone can take away the property from General motors and actually doing it, then private property does not exist.

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Chilli Sauce
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Mar 10 2016 03:50

The thing is, the manner in which individual capitalists and capital and the state divide capital between/steal from each other isn't my concern. Nor does it detract from the fundamental nature of capitalism. If wage labor, commodities, and extraction of surplus value exists, it's capitalism.

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Auld-bod
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Mar 10 2016 07:18

Agree with Khawaga & Chilli’s posts.

Meerov21 #3
‘Also In Russia property is not protected. So for Russians the main incentive is not profit, but obtaining power in the state.’

Private property is protected by obtaining state power or having friends in high places. If a comparison is made between the mafia and the Russian setup there are more similarities than differences. Each relies on patronage and brute force. The so called ‘democracies’ are more discreet in the way they operate, due to many decades of refinement.

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Mar 10 2016 07:46
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If there is wage labour, commodities are exchanged for money, people are dispossed from the means with which they need to reproduce themselves, then it is capitalism. Sure, it has different flavours, but the core of it stays the same.

Even in the absence of wage labour it has been argued (see, Aufheben #2), quite convincingly, that it can still be capitalism.

meerov21
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Mar 10 2016 08:52

Nor does it detract from the fundamental nature of capitalism. If wage labor, commodities, and extraction of surplus value exists, it's capitalism.

All of this this was on a large scale in pre-revolutionary France. If France of Louis 16 was a capitalist country, then what has done by the French revolution ?

meerov21
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Mar 10 2016 09:23

"Even in the absence of wage labour it has been argued (see, Aufheben #2), quite convincingly, that it can still be capitalism".

But any definition is just a tool. And what is this tool for? What does it gives to us? Russian psychologist Vygotsky said: "If the meaning of the term tends to infinity, encompassing more and more phenomenas, then its practical sense tends to zero".

The generally accepted definition of capitalism is that it is a system based on wage labour, production of commodities, investments, private property and bourgeois rights of ownership, exemplified by the laws of Napoleon I, and other similar legislations

Suppose we follow your definition. And we decide that capitalism was in pre-revolutionary France Louis 16 and so... what did the great French bourgeois revolution in this case? .

meerov21
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Mar 10 2016 09:22

Auld-bod Private property is protected by obtaining state power or having friends in high places.

Not every businessman is able to make some friends there. In addition, if your enterprise has started to generate a lot of money, close friends of the President pay attention on it and then you'll have to give it to them.

If you're not a very big businessman you are not interesting for the friends of the President but you will attract the attention of local officials. In addition, there are many state-owned monopolies in the country on the top and also at the regional level, there are a lot of activities you can't do. These circumstances destroys interest in investing. Low incentives to invest are forcing Russian business to withdraw money from Russia or to abandon the production.

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Mar 10 2016 09:43
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If France of Louis 16 was a capitalist country, then what has done by the French revolution?

The French revolutions put political power in the hands of the bourgeoisie.

meerov21
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Mar 10 2016 09:51

The French revolutions put political power in the hands of the bourgeoisie

And only this? Usually say that the French revolution opened way for the development of capitalist relations, destroying old pre-capitalist institutions of society like the guilds of artisans, feudal estates, the property of the feudal lords etc.

Let's say we accept your definition. In this case, who had ordered a political power before the French revolution?

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Mar 10 2016 10:44

Meerov21 #9
‘Auld-bod Private property is protected by obtaining state power or having friends in high places.
Not every businessman is able to make some friends there. In addition, if your enterprise has started to generate a lot of money, close friends of the President pay attention on it and then you'll have to give it to them.

If you're not a very big businessman you are not interesting for the friends of the President but you will attract the attention of local officials…’

Thank you, you are demonstrating the point I was making. Someone not in Putin’s ‘family’ is at risk of expropriation. Like the mafia, this runs through all of society from high to low. I see no disagreement.

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Chilli Sauce
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Mar 10 2016 13:59
meerov21 wrote:
Nor does it detract from the fundamental nature of capitalism. If wage labor, commodities, and extraction of surplus value exists, it's capitalism.

All of this this was on a large scale in pre-revolutionary France. If France of Louis 16 was a capitalist country, then what has done by the French revolution ?

Like Whirlwind said, the French Revolution was about putting political power in the hands of bourgeoisie. The revolution consolidated capitalism and did, as you say, help to wipe away those last vestiges of feudalism, but capitalism - and it's social relations - was clearly already on the ascent in France at the time.

I've never read the 18th Brumaire, but that's where I'd start if I was looking to really dig into class relations in pre- and post- revolutionary France.

meerov21
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Mar 10 2016 23:41

Like Whirlwind said, the French Revolution was about putting political power in the hands of bourgeoisie. The revolution consolidated capitalism and did, as you say, help to wipe away those last vestiges of feudalism,

So, which social class had the power before the revolution?

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Chilli Sauce
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Mar 11 2016 03:29

Directly before, I'd say social and political power was in flux between the aristocracy and the bourgeoisie. But, economic power was clearly moving into the hands of capital before the revolution kicked off.

But what's your point?

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whirlwind
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Mar 11 2016 07:36

Chilli Sauce:

Quote:
I've never read the 18th Brumaire...

I am not making any particular point by quoting this passage but I just wanted to share it because I appreciate the wonderful flow of the prose:

Quote:
The peculiar character of social-democracy is epitomized in the fact that democratic-republican institutions are demanded as a means, not of doing away with two extremes, capital and wage labor, but of weakening their antagonism and transforming it into harmony. However different the means proposed for the attainment of this end may be, however much it may be trimmed with more or less revolutionary notions, the content remains the same. This content is the transformation of society in a democratic way, but a transformation within the bounds of the petty bourgeoisie. Only one must not get the narrow-minded notion that the petty bourgeoisie, on principle, wishes to enforce an egoistic class interest. Rather, it believes that the special conditions of its emancipation are the general conditions within whose frame alone modern society can be saved and the class struggle avoided. Just as little must one imagine that the democratic representatives are indeed all shopkeepers or enthusiastic champions of shopkeepers. According to their education and their individual position they may be as far apart as heaven and earth. What makes them representatives of the petty bourgeoisie is the fact that in their minds they do not get beyond the limits which the latter do not get beyond in life, that they are consequently driven, theoretically, to the same problems and solutions to which material interest and social position drive the latter practically. This is, in general, the relationship between the political and literary representatives of a class and the class they represent.

The Eighteenth Brumaire of Louis Bonaparte. Karl Marx, 1852

meerov21
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Mar 12 2016 18:46

Private property is protected by obtaining state power or having friends in high places.

According to the results of the analysis in Russia 64% of the billionaires became the owners of such wealth because of political connections and of proximity to raw materials. In the other BRICS countries — Brazil, India, China and South Africa — this proportion is 4.6, of 10.7, 9.2 and 12.5%, respectively.
http://www.rbc.ru/economics/11/03/2016/56e2a1ac9a7947f56bedc71a

In other words, to become a billionaire, you have to be in Russia, a high-ranking official. Not wealth gives you power but power gives you wealth. Moreover, this wealth is not your private property, you have to give part of it to the chiefs, and they can take away wealth at any time.

meerov21
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Mar 12 2016 19:00

Directly before, I'd say social and political power was in flux between the aristocracy and the bourgeoisie. But, economic power was clearly moving into the hands of capital before the revolution kicked off.
But what's your point?

Before the French revolution, the aristocracy owned large land estates. Aristocrats had the privilege not to pay taxes, unlike the bourgeoisie. At the same time, the nobles acted as judges, and their influence on the judiciary was huge. The aristocrats were the top of the French state. The proximity to the state made possible the enrichment. The state collected taxes and handed out huge loans to business. In turn, the businessmen bought the titles because it gave tax and legal privileges. Private property was not at the same time protected as it is in modern France. The king could take away property and even the lives of any person. The whole system is not considered to be a pure capitalist. It was the French revolution swept the state and society of France from the elements of feudal relations. Then why are we talking about modern Russia or Assad's Syria as the capitalist countries, if society and the state there is more or less like pre-revolutionary France?

rooieravotr
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Mar 13 2016 00:48

First, on the definition.

Quote:
Capitalism is an economic system of production and distribution, based on private property, General legal equality and freedom of enterprise. The main criterion for making economic decisions is the desire to increase capital, earn a profit.

That is Meerov21, comment #3. The confusion sits in that pair of words, 'private property'. Meerov21 understands that as non-state property I think it can be better understood as 'non-social property' i,.e. any form of property opposed to/ separated from control by society. rtivate property copmes in different forms: one owner, a family who owns it, shareholders who own it, a state that owns it. Anybody, except society, the workers/ producers collectively.

Now, not all forms of private property are capitalist. But that does not depend on the form of the property (private, state or whatever). It depends on how it functions, in what way any surplus goes from producer to exploiter, and for what goal. Does it operate to make a profit, based on wage labour? Is the goal making money, only to make more money? That is how capitalism works. Or is it to raise revenue - NOT necessarily money - , so the elite can have a luxurious life? In that case, feadalism or an tributory mode of production is in operation, not capitalism. In feudalism,. peasants were exploited, but the result was not necessarily sold on a market. Most of it was just used by the landlords, the feudal elite themselves.

Even in France pre-1789, this - use values going from peasant to landlord through tribute and feudal dues, NOT through wage labour from worker to capitalist - was still dominantly operative. Exchange values going from worker to capitalist was growing, but still obstructed by all kinds of feudal laws. The revolution did away with these obstructions and gave the - already strong but not yet dominant - capitalist forces free reign. And NO, wage labour was not the dominant form of explouitation in pre-revolutionary France. Feudal duties, partly but not totally monetarized, were. That is why it does not make sense to call pre-revolutionary France a capitalist country. It was feudal, with growing capitalist forces, but in need of a revolution to de-block these forces.

Now, does Putin 's Russia operate with feudal lords - state or non-state, openly criminal or with the law on their side - exploiting peasants (or a city workforce with peasant conditions, servitude, etc.) through feudal dues and seignorial rights? Or do they exploit workers, through wage labour, with the bosses, after they exploit workers through wage labour, extorting each other, one capitalist robbing another for a bigger share of the profits? In other words, do we have feudalism? Or do we have capitalism of a robber baron variety (much like the US between 1865 and 1900, by the way)? Looks much more like the second, doesn't it?

meerov21
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Mar 13 2016 02:12

There was a group of German Marxist immigrants during WWII who created the theory of "retro-grationism". According to it Stalinism and fascism is a throwback to the absolutist-feudal society. Some other Western Marxists, such as Karl Wittfogel, believed that Stalin's USSR is a form of the Asiatic mode of production. Similar ideas were expressed by non-Marxist German philosopher Rudolf Baro. That also means sort of a regress in comparison with capitalism.

I do not think it is proved that the society is in constant development. After ancient civilization there were centuries of regress - the dark ages.

Don't think it is proved that wherever there are market relations, there is capitalism. The markets were in Athens and in Ancient China.

meerov21
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Mar 13 2016 02:13

rooieravotr i will answer you later

meerov21
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Mar 13 2016 02:29

rooieravotr thanks for the questions

Does it operate to make a profit, based on wage labour?

Yes

Is the goal making money, only to make more money?

Probably not. In Russia, state power has more value than money. Let me repit: According to the results of the analysis in Russia 64% of the billionaires became the owners of such wealth because of political connections and of proximity to raw materials. In the other BRICS countries — Brazil, India, China and South Africa — this proportion is 4.6, of 10.7, 9.2 and 12.5%, respectively.
http://www.rbc.ru/economics/11/03/2016/56e2a1ac9a7947f56bedc71a

At the same time, any one of them can lose their property and liberty at any time, at the request of the security agencies. So big business is closely connected with officials of the ruling party. Many businesses tend to buy high bureaucratic positions or seats of deputies and invest in it because it is a more reliable source of income than the production itself.

rooieravotr
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Mar 13 2016 14:07

Yes, state power is very important in Russia, and business people look for political connections.. But WHY do the owners of such wealth value their connection to state power? To enjoy power for its own sake? Or te make it easier to make even more money than they already have? Bosses need Putin to protect their money, and to make it even easier to make even more money. Profit-making is still the name of the game. The fact that state power is important to capitalists does not make them, or the state, any less capitalist.

Then there is the matter of the security of private property:

Quote:
[any one of them can lose their property and liberty at any time, at the request of the security agencies./quote]. This is only a rather exptreme example of ther situation in all capitalist states. The concept of inviolable property rights is ideology, meant to be believed by workers, but not to be taken to seriously by capitalists themselves. Every capitalist state recognizes something that, in the UK I believe is called "eminent domain"; if the state says it needs a piece of private property for state needs, it can take it away, with or without paying for it. It happens for infrastructural projects, but also for military needs. The state has this right, in order to enforce capitalist priorities in general, even against specific capitalists themselves.

What happens under Putin is a somewhat more openly corrupt version of what happens quite often in capitalist states. I see no reason to see this as an argument for the non-capitalist character of Russia. In the Netherlands, in 2008, big banks were unuilaterally nationalized by the government, to prevent their collapse. This was a clear example of the state ignoring private property rights of specific capitalists, in order to strengthen capitalism as such.

The whole idea of legally inviolable property rights is rather mythical. Property, under capitalism, is to be prttected, not against the (capitalist) state, but against the people exploited and oppressed by capitalists and the state. Inviolable property rights belong to the ideology of capitalism, its justification. These rights do not describe how capitalism actually works. Not in Russia, not in the Netherlands, not in the USA or anywhere else.

meerov21
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Mar 13 2016 16:32

Bosses need Putin to protect their money, and to make it even easier to make even more money.

Not sure about that. It seems that reality is just completely different. In this case, political control over the security forces of the state is more important than money itself. Money can be taken away at any moment. Meanwhile, only the political power gives you the control over financial flows here. Moreover, it is a tendency. As the bureaucracy becomes stronger and destroys or takes away the business, then more and more businesses is interested to withdraw their funds from Russia. This is what is happening now. 150-200 billion dollars fled Russia in every year amid increasing appetites of the mafia, and also many businessmen run, small and large.

Those who remain are forced to invest more and more money into the state apparatus, there they give bribes for officials or buy places in the state apparatus.

Also there are some businessmen who say that they can no longer do it and they "want a bourgeois-democratic revolution and the destruction of the Putin mafia". Some are already talking openly about it.

It doesn't look like a situation where the business just investing money into production to invest more and so on without end.

It looks like the behavior of the bourgeoisie in the beginning of the French revolution, when the business has shown a desire to control the power to which he pays taxes and refused to Finance the expenses of the Royal Versailles and theier was.

Exactly the same thingstoday some businessmen in Russia say: "we don't want to pay taxes for war in Syria and Ukraine".

The fact that state power is important to capitalists does not make them, or the state, any less capitalist.

Yes, but this is so only when the state is under the control of the business, giving him the credits and subsidies, protects his property from the rebellions of the workers and make only wars they need. And here the situation lookes different. 60 people and officials associated with the raiders constantly attack business and take away his money and possessions, and even personal freedom.

meerov21
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Mar 13 2016 16:51

The whole idea of legally inviolable property rights is rather mythical... Inviolable property rights belong to the ideology of capitalism

Of course, life is life and the state in the Netherlands can sometimes take away the property of the capitalist against his will. But are you quite sure, that the property of the capitalist in the Netherlands is protected from corrupt officials and racketeering as bad as in Rwanda, Burundi and Russia?

Meanwhile, the participation of the bourgeoisie in the French revolution were caused primarily by the desire to protect their property better than in France of Louis 16 and to control the amounts of taxes.

Don't you think that denying the distinction between the measure of property protection, you deny the significance of the French revolution in the development of capitalism?

meerov21
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Mar 15 2016 10:35

The confusion sits in that pair of words, 'private property'. Meerov21 understands that as non-state property I think it can be better understood as 'non-social property' i,.e. any form of property opposed to/ separated from control by society.

I know this Bordigists thesis. Such an approach is possible. But the question is what it gives us to understand society? For example, if we accept such a definition we find private ownership in ancient Greece and in ancient China, in feudal and medieval Europe. The problem is that they are very different forms of ownership.

Primal
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Mar 21 2016 22:21

I think I have an explanation for what's going on - our silly friend meerov21 here is intent on trying to convince people that Russia is a terrible place, the more you say anything to him the worse he will try to make out Russia is.

So when you go along with the idea that Russia is a bit worse than the US or UK in terms of protecting private properly - which seems plausible - in order to get to the actual political theory of what he's saying... he will be talking about the likes of Rwanda and things and how Russia is supposedly like that.

He's even using the childish tactic of setting it down as a given, as a known premise that Russia is like this, despite it being a major escalation of his already wild claims. Conclusion - joke poster.

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patient Insurgency
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Mar 22 2016 01:14

It's just my own perspective (I think), but i don't actually see any functional difference between private property and state property. To the worker its still work or starve, and the basic mechanism by which it is forced is the same. the only difference is that its not normally bought or sold, and can be seized by force.

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Mar 24 2016 11:58

Primal is correct about a joke poster.

meerov21 #17

'Not wealth gives you power, but power gives you wealth.'

meerov21 #22

'Many businesses tend to buy high bureaucratic positions or seats of deputies and invest in it...'

Anyone spot the contradiction?

Battlescarred
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Mar 25 2016 20:35

"Do we have capitalism in Putin's Russia?"
Yes, of course.

meerov21
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Mar 26 2016 02:37
Quote:
Primal

I think I have an explanation for what's going on - our silly friend meerov21 here is intent on trying to convince people that Russia is a terrible place, the more you say anything to him the worse he will try to make out Russia is.

This is the typical language of the Russian media and Pro-Russian politicians . Insults instead of arguments. It also has the typical language of a large part of the Western left.

So when you go along with the idea that Russia is a bit worse than the US or UK

This is another specific method of Pro-Russian media and their supporters in the West - leftists or just the people not able to debate. Distortion and attributing to the interlocutor's thoughts, which he had not made. I never claimed that the Russian system worse than the US or UK. Different does not mean better or worse. Although it is obvious that almost everyone and even pro-Kremlin left creature would prefer to live in South Korea, and not North (if he has only this choice) I do not support the choice between different systems of alienation, exploitation, hierarchy.