Thursday, April 8, 2010



Kyrgyzstan, a nation of some 5.4 million people about the size of South Dakota, former member of the Union of Soviet Socialist Republics and subsequently, of the Commonwealth of Independent States, after the collapse of the Soviet Union in December of 1991, and present participating member of the Shanghai Cooperation Organization also holds the unique distinction of being the only country in the world to host both a U.S. military installation, the so called Manas Transit Facility, and a Russian base as well, the Kant Air Force Base, both within less than 30 miles of each other. Kyrgyzstan also shares a long border with China to the south opening up on the restive Xinjiang Uyghur Autonomous Region in the Peoples Republic, making the Kyrgyz Central Asian republic a critical geopolitical arena and staging ground for the strategic maneuverings of the three international powers as the global focus is drawn inexorably onto the stage of the Brzezinskian Grand Chessboard of Central and South Asia.

What for some of us might appear then to be merely another titillating third world IMF riot รก la Joseph Stiglitz suddenly assumes a larger proportion, perhaps foreshadowing the rapidly evolving and inevitable confrontation brewing between the U.S., China, and the resurgent Russian federation as the world economic structural collapse accelerates and access to dwindling energy, food, and water resources becomes an increasingly essential concern of national security agendas.

Unfortunately for many poor and "developing" countries, little has changed since the Cold War when nations became so many battlefields by proxy for the wider ideological conflict between East and West. The same holds true for the nations comprising the "newly independent" Commonwealth of Independent States which came into being following the collapse of the Soviet Union in 1991. The abrupt and catastrophic transition into market based economies after decades of centralized state control paralleled the fate of Russia itself. Privatization and market liberalization, the longstanding concomitants of IMF hegemony eviscerated industrial production, transferred public utilities and national enterprises in the mining and energy sectors into the hands of a corrupt oligarchy. The resultant asset stripping, plundering of resources and national wealth, the evaporation of personal savings was creative of an economic and social catastrophe within Russia and its satellite countries.

The solution to this problem was, of course, more massive infusions of capital and credit, with a characteristic outflow of resources and capital back into the "donor" agencies*. In Krygyzstan alone, the combined agencies and enterprises of more than 40 locally based international organizations with 22 offices nationwide under the auspices of the U.S. Agency for International Development, along with a plethora of European, Japanese, Turkish, and Asian investment banks, finance corporations and security, development and cooperation organizations, all directly or indirectly funded by the World Bank and IMF, have since 1992, descended en masse upon the mountainous Central Asian nation with the obvious and unmistakeable consequences of organized economic predation under the flimsy and transparent guise of free market capitalism and development.

As one of the weakest and impoverished of the former Soviet Republics, the former Kirghiz SSR, came under the first of its nepotistic despots in the person of Askar Akayev, a physicist educated in Leningrad, in 1991. Akayev's connections with the old Soviet Union were such that he was later selected by Putin for the vice-presidency of the Russian Federation, a position which he declined in favor of his presidency of Kirghiz SSR. Akayev's accommodations with Moscow were accompanied by a similar fealty to the International Monetary Fund which established Kirghiz SSR as a full member in 1992, and the above mentioned cartel of international "donors" under the aegis of USAID and with the participation, not surprisingly,of the ubiquitous Soros Foundation. This precarious arrangement was augmented by an equally curious balancing act sandwiched between the vast and energy rich Kazakhstan to the north and the energy hungry and rapidly developing Chinese behemoth to the south. In the process, the Kirghiz SSR was ground inexorably and unremittingly between the opposing weights of these immense, economic and geo-political millstones, not to speak of the brutal ministrations of the corrupt despot working on their behalf

Akayev's tenure began to be threatened almost immediately upon a bilateral agreement with Russia which established the Kant Air Force Base in September 22, 2003. On the heels of the Rand corporation sponsored "color revolutions" in the Ukraine and Georgia, Akayev fled to Moscow after the so called Tulip revolution toppled his corrupt, despotic and scandal plagued regime on March 24, 2005, installing Kurmanbek Bakiev as the "first" president of Kyrgyzstan. Bakiev assumed power in the great and mistaken assumption that the dictatorial excesses of the Moscow puppet regime would be eliminated and that the grinding poverty with over 40% of the population below the poverty line would be alleviated. These grand and unfounded hopes were soon transformed into even greater and growing inequities and social chaos which had characterized the previous regime as Bakiev played off the contending international powers against each other all the while loyally serving the IMF suzerain with undivided loyalty.

Bakiev's undeniable skill at personal influence peddling was apparently the cause of his downfall as well. He managed to get the Americans to triple the amount of their "rental" of the Manas Airport, an extensive enterprise, essential for supplying U.S./NATO/ISAF forces in Afghanistan, from $20 million to $60 million, for his influence in forestalling a parliamentary vote to expel the Americans, while at the same time securing $150 million from the Russians in addition to a hefty $2 billion loan to be released in successive tranches for his efforts to remove the base in a quid pro quo arrangement with Moscow. In the end the USAF base was allowed to continue though now designated only a "transit facility", the immense and lucrative contract for concessions being placed firmly in the control of his son Maksim. It has been suggested that this double cross enraged Putin and was responsible for obvious and elemental role that Russian military forces played in the subsequent "revolution". To this effect Russian Federal Security Forces were on the ground in Kyrgyzstan in the weeks preceding the events of April 8 following the visit to Moscow by selected members of the Kyrghiz opposition.

Maksim Bakiev is a case study in the overt nepotism which has so characterized the regimes of both Akayev and the elder Bakiev. Bakiev the younger is part owner of the British Blackpool Football Club as well as now former head of the Central Agency for Development, Investment, and Innovation. Also the main shareholder in the Kumtor Gold Mine operated by Canada's Centerra Gold, an enterprise which contributes a whopping 10% of total GDP and over 40% of industrial production, Maksim just happened to be out of the country on his way to address the Krygyzstan Opportunities Economic Forum II in Washington co-sponsored by the U.S. Department of Commerce. The subject of that address preempted by the events back home was the acquisition of hydroelectric, energy and mining concessions in Krygyzstan by Western investors. With his whereabouts initially unknown he was eventually tracked to Latvia where he owns "several businesses".

Such incredible corruption is typical of IMF friendly regimes and is indicative of the kickbacks, slush funds, and preferential concessions meted out to the coteries of well connected insiders and dynastic hierarchies which help create the state facilitated climate that expedites and enforces the often draconian IMF economic policies which we are now witnessing the ultimate results of in Kyrgyzstan and throughout the "developing" world. Akayev, Bakiev, and most recently Roza Otunbaeva all serve the financial diktat of the IMF/World Bank hegemonic class. Indeed, the measures which Bakiev initiated in late 2009 including a sharp increase in taxes on small and medium sized businesses, and on January 1, the institution of new tariffs on telo-communications, electricity, and heating costs effectively increasing costs in public utilities by an "eye-watering" 500 to 1000% were a stark example of IMF austerity policies in a country where GDP growth had already taken a precipitous plunge of more than 10% from 12% in 2007 to less than 2% in 2009.

As recently as February 20. 2010, a little less than two months preceding the saguinary violence which convulsed the Khirghiz republic, the IMF issued one of its patented, most deliberate, and self serving misstatements concerning the supposed economic welfare of Kyrgyzstan. According to the IMF website, "the Kyrgyzs economy has weathered the effects of the global economic crisis well" and the performance of the economy under the Exogenous Shock Facility (ESF) "continues to be good". Krygyzstan was one of the first countries to avail itself of the ESF program in December of 2008, ostensibly providing the debt ridden nation $100 million over an 18 month period to "alleviate higher food and fuel prices". What isn't indicated is that the escalating prices were the direct result of the usual IMF Enhanced Structural Adjustment facility itself. The newly founded ESF had replaced the Poverty Reduction and Growth Facility (PRGF) under which Kyrghystan had labored since its inclusion in the IMF fold in the early 90's.

Under the regimen of the PGRF, instituted in 1999 with IMF loans of $116 million and provisions of the Krygyz Republic Enhanced Structural Adjustment Facility (1998-2000), the usual "comprehensive privatization program" was undertaken with an expectation of the eventual privatization of 100 additional large enterprises, including the aforementioned Kumtor gold mine which under IMF dictate was to "render all dividends and other payments directly transferred to the budget". The government itself was quite typically to "reduce all transfers and subsidies to public enterprises and the Social Fund and to curtail all non-priority public spending". In addition the "government will submit to the parliament privitization plans for the gas and electricity companies". Government pension and disability funds were to be drastically curtailed as well. All of these measures were undertaken for the express purpose of maintaining increasing levels of external debt management along with the maintenance of current exchange rates and the "improvement of tax administration" and streamlining of customs duties and payments contributing to the debt service as well. With this fiscal stranglehold in place under the lockdown of an IMF friendly police state apparatus under Akayev, the denizens of Kyrgygstan were reduced to depending on "remittances" from immigrant workers in Kazakhstan and the Russian Federation for 27% of GDP, with the general population of 40% below the poverty line and 18% official unemployment, and a 10% inflation rate. When Putin cut the Russian quota for Kyrgyzs immigrant labor by over 50% in December 2008, the stage was indeed set for massive destabilization and the ensuing and inevitable conflagration.


yardfarmer said...

this photoshopped picture is an emblem of the noble revolutionary, an over romanticized and overblown hyperbolic resonance with some past glory, the rosseauvian equiivalent of the noble savage I suggest you dispense with such pictorially rhetorical flourishes and seek gainful employment.

George said...

but hey they did overthrow their government.

iceland, greece have also rebelled.

in the case of kyrgyzstan sounds like it was the usual privatization to friends of the oligarchy....

people were saying they were angry because it was hard to survive because the utilities were costing too much.

sounds like they had a corrupt government...people get angry when things really stop working. when unemployment benefits run out who knows...could be like this in our major cities, hope not.

jones went with the idea at first that it was somehow a provoked revolution from outside, then changed his tune.

my take is that it is the very real result of massive corruption from the arrogance of a politcal elite that provokes these things....the brezinski chessboard seems to be in tatters. if it wasnt so tragic i was almost laughing to myself as karzai threatened to join the taliban.

its all some kind of crazy mafia mess. waring mafias.

is it just coincidence that the two big games on facebook are mafiawars and dope wars?

George said...

btw...if i am just following naively the news reports on this one, let me know. but i thought this was a geniune uprising of some sort.

yardfarmer said...

You got a pretty good handle on this one, George. I didn't post up on this one yet, but I'm going to today. This has all the hand, foot,and fingerprints of the IMF which is productive of the classic "IMF riot" which former World Bank president Joseph Stiglitz refers to. Kyrgyzstan is only a little larger than South Dakota with a population of 4-5 million but this revolution is a seismic shift which along with Greece and Iceland is the curtain raiser to the main event which Jones and his Info Wars crew correctly predicts will soon be coming to our own neighborhoods, streets, and cities.

George said...

thanks for the IMF riot tip, i just read the greg palast interview with stiglitz. that certainly sounds like what is happening all over.

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