Yves here. This is one of the too-few articles to provide any insight about the revolt in Kazakhstan. It makes clear it is along the lines of the Arab Spring uprisings, which were triggered by the one-time middle class and poor becoming unable to bear food and fuel price increases. This is consistent with the take of Craig Murray, in a post published shortly after the upheaval started:
The narrative on the right is that Putin is looking to annex Kazakhstan, or at least the majority ethnic Russian areas in the north. This is utter nonsense.
The narrative on the left is that the CIA is attempting to instigate another colour revolution and put a puppet regime into Nur-Sultan (as the capital is called this week). This also is utter nonsense.
The lack of intellectual flexibility among western commentators entrapped in the confines of their own culture wars is a well-established feature of modern political society. Distorting a picture into this frame is not so easily detectable where the public have no idea what the picture normally looks like, as with Kazakhstan.
When you jump into a taxi in Kazakhstan, getting your suitcase into the boot is often problematic as it will be already full with a large LPG canister. Roof racks are big in Kazakhstan. Most Kazakh vehicles run on LPG, which has traditionally been a subsidised product of the nation’s massive oil and gas industry.
Fuel price rises have become, worldwide, a particular trigger of public discontent…
The current political crisis in Kazakhstan was spiked by moves to deregulate the LPG market and end subsidy, which led to sharp price increases. These brought people onto the streets. The government quickly backed down and tried to reinstate price controls but not producer subsidies; that would have led gas stations to sell at a loss. The result was fuel shortages that just made protest worse.
This openDemocracy post gives more detail on the moving forces behind the Kazakhstan LPG deregulation. And this is far from the only rentier activity in Kazakhstan; we published earlier on predatory microlending in Kazakhstan and Kyrgyzstan.
By Balihar Sanghera and Elmira Satybaldieva, the authors of Rentier Capitalism and Its Discontents>: Power, Morality and Resistance in Central Asia (Palgrave Macmillan, 2021). Originally published at openDemocracy
The recent protests in oil-rich Kazakhstan have highlighted the devastating effects of rent extraction. The country’s largest sellers of liquefied petroleum gas (LPG), including KazMunaiGas, Kazgermunai, CNPC-AktobeMunaiGas and Kazakhoil, have been accused by the government of increasing fuel prices by abusing their oligopoly power. When the state lifted its price cap on LPG at the start of 2022, the market price doubled within a couple of days. The impact was immediately felt by poor and vulnerable sections of Kazakhstani society, which relied on the commodity for heating and vehicles.
Ultimately, the price hike was a violent attempt by powerful oil corporations to extract rent – they knew that most of the population had no alternative but to pay up or go without. Akin to social historian EP Thompson’s moral economy of the 18th-century English crowd that rioted against soaring food prices, Kazakhstan’s working class revolted against the market price and the injustice of the ‘free’ market.
‘Free’ Market
Kazakhstan’s government justified the removal of the price cap by saying that it was complying with market principles. It wanted to liberalise the market by ending the price subsidy on LPG, and allowing the ‘free’ market to dictate the price. This policy is based on mainstream economic thinkingthat a commodity’s price and value should be determined by demand and supply to reflect its scarcity and costs.
Moreover, the government argued that the price subsidy had created a domestic shortage of LPG. Illegal traders were said to have exported LPG to neighbouring countries, where prices were significantly higher than in Kazakhstan. The market reform would incentivise oil corporations to reduce their exports overseas, and sell domestically at a better price.
But such justifications and faith in market forces proved to be seriously flawed and fatal. Whereas the price cap had previously limited the powers of natural monopolies, the government was now proposing that large oil corporations dominate the market and dictate and raise prices to what the market could bear. The price jump from 60 tenge ($0.14) to 120 tenge ($0.28) per litre was a sheer exercise in economic power and rent extraction, which was initially defended as an outcome of impersonal electronic market trading.
The price rise came as a shock to most working-class people, who had already seen higher inflation and interest rates increasing their living costs over the past year. For the working class, LPG, dubbed “road fuels for the poor”, was cheaper than alternative fuels, such as diesel and gasoline, which can cost 180–240 tenge ($0.40–0.55) per litre. In the south-western region of Mangystau, and many other parts of the country, it is estimated that 70–90% of vehicles use LPG.
Facing abject poverty, immense inequality and blatant value-grabbing, a large section of the working class, in many districts, revolted against the introduction of a market reform that clearly favoured the rich and powerful propertied class, including oil and gas executives and shareholders. In cities across the country, violent clashes between protesters and security forces left many people injured or killed, and numerous buildings and cars set alight and destroyed. Almaty, the commercial capital, looked like something from an apocalyptic film.
Rent arises from unequal power relationships between the powerful propertied class (the asset-rich, or rentiers) and those without property (the asset-poor). The former can extract income because they own and control assets that the latter want or need, but lack them. There are different forms of rent, including interest, land and housing rent, capital gains, dividends, access fees, road tolls and price markups arising from monopoly power. Rentierism refers to often dominant and legalised economic practices and arrangements to extract rent. Rentiers obtain income because they have power over others, not because they deserve or have earned it.
In a frantic effort to deflect criticism and apportion blame, energy minister Magzum Mizagaliyev accused the country’s petrol stations of price-fixing and price speculation. As natural monopolies are wont to do, major petrol stations marked up LPG prices as much as possible to reflect their economic power, rather than the commodity’s scarcity or costs.
Public anger, civil unrest and government pressure escalated, and the petrol stations reduced their prices to 85–90 tenge (c. $0.20) per litre. It was a collective endeavour by the state and oil corporations to appease the growing crowd of protesters. Finally, as demonstrators’ demands and actions intensified further, the government was forced to re-introduce a temporary price cap, slashing prices to 50 tenge ($0.11) per litre.
Class Warfare
At the heart of the crisis is a fundamental question: what kind of a ‘free’ market and capitalism operates in Kazakhstan?
For supporters of neoliberalism, a ‘free’ market means that economic actors are free to extract rent, free of state controls. Rent refers to income generated by the mere virtue of owning and controlling scarce assets, such as credit money, land, retail estate, natural resources, digital platforms and patents. This ideal of a ‘free’ market has hugely benefited Kazakhstan’s banks, property developers, oil, gas and mining corporations and retail chains, collectively known as the rentier class.
Rent extraction contributes to inflated prices, indebtedness and precarity in the wider society
These rentiers receive income by partly siphoning off surplus value that others produce. It is unearned income, and their rent extraction contributes to inflated prices, indebtedness and precarity in the wider society. Their income is parasitic and harmful to most of the population.
Moreover, capitalism is organised around rent extraction rather than wealth creation, in which the rentiers, not the producers, dominate economic and political practices and institutions through regulatory and state capture. The emergence of rentier capitalism as an economic order has produced income inequality and plutocracy in Kazakhstan.
The truth is that Kazakhstan’s government and the rentier class did not care about addressing the domestic LPG shortage. The price ‘liberalisation’ was merely another attempt at unjustly enriching the country’s rentier class at the expense of the working class (including rural migrants and the unemployed).
In 2019, Timur Kulibayev, the son-in-law of the former president, Nursultan Nazarbayev, and one of the richest persons in the country, privatised a large network of petrol stations belonging to the national company KazMunaiGas. He benefited from the subsidy given to LPG as state income was transferred to his company. Then when the price cap was lifted, he benefited from the freedom to charge customers more.
Political Theatre
In an effort to discredit and delegitimise the protesters, President Kassym-Jomart Tokayev called them ‘terrorists and bandits’ – a familiar trope that has been used in the past to justify violent and brutal crackdowns on the working-class’s legitimate economic grievances.
A few days later, when order had been restored, President Tokayev spoke in a more conciliatory tone. He highlighted how his predecessor Nazarbayev had allowed the super-rich to thrive in the country. He also said that wealth should be redistributed, by demanding that the rich and powerful make a tribute to the people through a social fund.
But this is political theatre – to show the nation Tokayev’s firmness and even-handedness, masking the state’s strategic selectivity and bias towards investors’ and rentiers’ short-term interests over sustainable economic and social development.
Amid this class warfare, some middle-class people –who were largely unaffected by the price hike – merely looked on or seemed irritated by the unrest. Some were hopeful that so-called ‘peacekeeping’ forces from Russia would quickly restore law and order. They also felt that the government should have used greater force at the start to quell the unrest.
Aynur Kurmanov, co-leader of the Socialist Movement of Kazakhstan, who is outside the country, bemoaned the lack of social solidarity in the uprising against rentierism. He noted that plutocrats, rentiers and post-Soviet states were better organised to suppress or co-opt the working-class movement in the country:
This entire analysis of rentierism can be applied to the United States. We have already had a cycle of street protests and assorted violences, both “legal” and “illegal.” A balance of sorts was established back in the 1930s through the New Deal policies of the American Government. Now, we have regressed nearly to where we were before the Great Depression. The only thing I can see keeping America from experiencing civil unrest like Kazakhstan presently suffers from is the lingering psychological sense of stability and security the New Deal imbued the American public with. Once the last of the New Deal Citizens pass away, all bets will be off.
We have regressed farther than the 1930s, our present time is more comparable to the gilded age of the 1890s.
The same post-civil-war gilded age which produced the Farmers’ Alliance, and the People’s Party…culminating in the failed presidential run(s) of William Jennings Bryan, who is later parodied as the buffoon attorney representing fundamentalists in Inherit the Wind
I wonder how history will record Bernie Sanders’ run?
first a technical – there’s a an unclosed italics tag somewhere..
Otherwise, I agree with Murray – both of “annex” and “CIA is going for another revolution” are idiotic, but unfortunately common in the “USA USA” world where only the USA, and sometimes Russia and China have any agency (and, within the USA, only the deep state, including the CIA etc..).
There’s one thing I’d add to the post though. The talks of “free market” by Kazak govt is just that, talk, in reality, they didn’t want to lose out on the super-high NG prices. So it’s a rentier’s market. But, TBH, that’s no surprise, as every time someone talks about free market, when you look at the details, it’s “free for me to do as I wish, and for you to do as I want you to”. Neither free (even when the free can always be only within confines of law), nor worse, market.
There are many other articles on this from people like Escobar who are hardly flakes.
And all the articles I’ve read certainly emphasize the predatory class divide but also point out that the rebels were suspiciously well organized and had among their demands that the government cut ties with Russia. So perhaps we can say that the above or even the estimable Murray not the definitive last word and that there may be more to the events than spontaneous unrest.
A lot of information remains hidden in the terms “internationals” and “oligarchs” because this is not simply an innocent mistake of natural “market” greed that spontaneously erupted. This was an organized uprising that could have been predicted in response to the theft of fair fuel prices. Maybe set up by an illogical scarcity in the first place as Kazakhstan’s got plenty of this little resource. How easy is it to squeeze the desperate into a riot? Pretty easy when you control the money. But this piece by Sanghera and Satybaldieva is so well written, so smoothly composed with a very clear definition of neoliberal extraction that it serves as the perfect distraction to the underlying possibilities – that indeed it could have been instigated by professional color-revolutionists, Pepe’s usual thesis, who might also happen to be international oligarchs. And etc. Russia went in and got out quickly. It looks like Russia was wisely avoiding another trap.
US and its three letter agencies have all the interest in the world to piggyback such a popular uprising in order to move the government to distance itself from Russia. In fact, one of the three main demands posted by the people revolting was a cessation of relations with Russia. Not something a class uprising would be wanting to do. If anything, and if one has some class consciousness, the demand should have been to cease any relations with the US and to close the US Embassy.
of course this was an attempted colour revolution. that doesn’t mean there are no serious social grievances. murray writes utter nonsense if he pushes this aside entirely
Making Shit Up is a violation of our written site Policies. Murray who knows Central Asia first hand, explains in his post, which you did not bother to read, that the CIA’s only possible potted plant refused to play ball and they have no one waiting in the wings and very very thin domestic contacts.
In addition to engaging in agnotology, you also broke our overarching rule for commenting:
In a country as geopolitically sensitive as Kazakhstan, I would not automatically rule out foreign involvement or aiding and abetting. As for Murry’s statements that this was not a color revolution because the CIA did not have contacts or someone lined up, this did not stop the regime change apparatus’s activities in Syria, and many years later we eventually settled on a “reformed” Al-Qaeda member as the anointed choice to lead Syria. The CIA obviously has limited contacts in Venezuela as well. Also, even if the CIA has no contacts there, could foreign intelligence agencies, such as Turkey’s, have enough contacts to push for regime change?
As for the riots, there is footage of rioters getting guns from car trunks. Could those videos have been staged? Yes, of course. Could those videos reflect local protestors with no foreign involvement? Yes, of course. Could those videos reflect pre-positioned arms by a foreign intelligence service? Yes, of course. Rioters also seized strategically important sites such as the airport. Did the DC Jan 6 rioters storm Dulles?
The US Embassy also issued this alert –genuine warming for Americans there, or free publicity for demonstrations?
“Demonstration Alert: U.S. Mission Kazakhstan
Saturday, December 16, 2021
Location: Nur-Sultan, Almaty, Shymkent, possibly other cities
Event: The opposition party Democratic Choice of Kazakhstan (DVK or DCK), which the Kazakhstani government has banned as an extremist group, is calling for demonstrations on December 16, 2021, at 12:00 p.m. to demand the resignation of Kazakhstan’s government, including First President Nazarbayev and President Tokayev, as well as freedom for all political prisoners.”
Many on the so called left were promoting the notion loudly that the Hong Kong protests were color revolutions when there was zero evidence of such, and counterevidence: the novel tactics and the known lack of CIA assets who were speakers of the local dialect.
In other words, it’s remarkable how the CIA is attributed both with superpowers and omniscience when the US is not that good, witness how Russia ran rings around us in the Middle East and our interventions have served to make Iran more powerful. Talk about an own goal in a bona fide politically sensitive area…which contrary to your claims, Kazahkstan is not.
And it serves CIA budgets to nevertheless flog the idea that the CIA is behind every revolt. Those who knew Russia made similar comments about Russiagate, another story promoted by the US spook state that fell apart: that at least in its early stages, it was the best thing that ever happened to the Russian propaganda apparatus, because they could claim they’d been wildly effective and seek more funding.
As an aside, a comment from a previously banned reader got through, and banned readers who manage to jailbreak have their comments expunged.
The pictures of HK protest leaders cavorting with US consulate officials were leaked all over the place.
HK protests would have had more chances if they would have focused only on issues related with democracy and the democratic processes and methodologies employed for electing representatives in their City Assembly.
The Basic Law agreed upon before HK went back to China, stipulated the mandatory enactment of a National Security Law, which would have formalized into law the “One China” part of the equation. That was delayed for about 25 years. Waving US and UK flags during the protests did not help democracy cause in HK. Because US & UK actually do not care about democracy.
I have a great deal of respect for Craig Murray’s experience and opinion but I am not sure he is accurate here.
He is clearly correct that the initial protests were in direct response to the rise in gas prices and as a long term response to the rentier situation in the country. That this is all it was seems more disputable.
I find M. K. Bhadrakumar’s take on this to be interesting. CSTO in Kazakhstan annoys US and given his background and interests he is likely to be very well informed on the issues. Also given Craig’s political and legal battles in Scotland over the last year or so his information is likely to be more current.
I am wondering if there may be several rival opposition groups whose various plans were disrupted by the protests and to decided they had to move then even if they really were not ready?
The issue is the large claim that the CIA staged a color revolution.
There is tons of evidence of outside interference in Ukraine. I saw George Soros interviewed in person at an INET session by Nazi descendant Chrystia Freeland where Soros proudly said that his Open Society Foundation had provided grants, either directly or close to directly (as in to spouses) or every member of the Ukraine government. Since neo-Nazis were disproportionately represented in that administration (15% v. 1% in Ukraine overall), Soros was openly supporting neo-Nazis.
And Soros’ involvement was clearly long-standing.
And that’s before you get to Victoria Nuland and other descendants of families of Nazis who fled during or right after WWII meddling. There’s nothing remotely approaching that diaspora in Kazakhstan.
Caveat: I am by no means expert in central asian affairs.
I don’t think that (at this point) there’s much doubt that this was, in broad, an internal power struggle executed as a pretty formulaic coup d’etat by elements of the Kazakh state, and (based on the subsequent reported suicides, resignations and departures), was conducted by Mr. Tokharev’s faction against the Nazarbyev clan. So far, so clear.
It doesn’t seem unreasonable to me that multiple other groups may have tried to take credit and/or steer this in support of various regime change / colour revolution objectives. That being said, that side of things doesn’t seem to have worked out at all well.
If I had to score this one, it would be:
WIN for Tokharev, CSTO / RF,
LOSE for Nazarbeyev clan
FAIL TO START for the usual regime change crowd
If you think I’m wrong, poke away.
Here’s Pepe Escobar if this link can go through.
https://www.globalresearch.ca/after-kazakhstan-color-revolution-era-over/5767287
He’s suggesting more of a NATO connection than a CIA connection. There is undoubtedly a NATO/Russia cold war going on at the moment and it’s alleged that a coup in Afghanistan would be to NATO’s advantage. The so-called “regime change playbook” is based on using local proxies and existing social unrest.
Thanks for this link. I tried to get to it two days ago but kept getting cut off. This is a spectacular piece of information. This certainly makes better sense of our leaving Afghanistan. Because this action was already in place. Making much more sense, as Afghanistan was merely a central position to hold whereas Kazakhstan is the key to the the BRI and extremely rich with oil, etc. Clearly Kazakhstan is the prize here and Russia and China wasted no time defending it. So now the next step, which is already planned because that’s the way it goes, is going to be a contest over two giant mideast oil resources – Kazakhstan’s and the Caspian/Gulf. Imo we are messing around in Ukraine for only one reason – oil from the Caspian – and we are not getting very far, so doesn’t it make sense to set up a new front in Kazakhstan to threaten BRI oil? So the disagreement will eventually be settled at the table (hopefully soon because until oil is settled the world will be chaotic) – I can see it now: the coalition with the BRI will get Kazakhstan and the NATO coalition will get the Caspian, claiming the natural rights of the Turks, etc. Raising the questions – Where do Nordstream2 and Iran fall? It might help if Iran and Israel could just bury the hatchet – making it much easier for the US and Russia to follow suit. So the world could get on with more important business. Much, much more important business.
What’s the big problem with capitalism?
Any serious attempt to study the capitalist system always reveals the same inconvenient truth.
Many at the top don’t create any wealth.
That’s the problem.
Confusing making money and creating wealth is the solution.
Some pseudo economics was developed to perform this task, neoclassical economics.
Rentiers make money, they don’t create wealth.
Rentier activity in the economy has been hidden by confusing making money with creating wealth.
Banks create money, not wealth, and so lie at the epicentre of the confusion.
https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy.pdf
What you think is happening and what is actually happening are two very different things.
Global policymakers have been finding out the hard way.
Why have our policymakers tried to drive our economy into a Great Depression?
That always happens with neoclassical economics.
Neoclassical economics is the economics of the Roaring Twenties, the Wall Street Crash and the Great Depression.
Policymakers sooner or later use the economic growth model of the Roaring Twenties, oblivious to where this is leading.
Japan had the financial crisis in 1991, and were left facing a Great Depression.
We had the financial crisis in 2008, and were left facing a Great Depression.
The Chinese have been using the economic growth model of the “Roaring Twenties” since 2008. Their problems are just beginning.
No one has got the faintest idea what they are actually doing.
This is what happens when you rig economics.
and free trade is a enormous generator of debt and poverty. it is the ultimate generator of wealth extraction in the world.
here is what truman said when the bill clinton types tried to organize GATT into a slave labor treaty on the world,
“Of course I believe in free enterprise but in my system of free enterprise, the democratic principle is that there never was, never has been, never will be, room for the ruthless exploitation of the many for the benefit of the few.” Harry S. Truman”
and this,
this was removed from the GATT by bill clinton,
“Compensatory tariffs might be added to products from countries that do not maintain international standards of environmental protection, wages, health and safety standards, and social safety nets, thus encouraging higher standards for all people everywhere.”
“this is the situation today: The domestic markets of these foreign producers have neither the size nor the wealth to support their own industries. As they undercut U.S. production, however, they will gradually weaken the American economic base that they have come to depend on. Rather than a self-sustaining, self-reinforcing process, this new relationship becomes self-liquidating.”
Franklin argued, the American manufacturers could not survive unless they were protected from low-wage competition
GDP in america under protectionism was far superior for workers than nafta billy clintons poor GDP performance
To sum up, the free-trade/market policies are policies that have rarely, if ever, worked
Few countries have become rich through free-trade, free-market policies and few ever will.
Dr. Ha Joon Chang plainly through historical records proves that free trade is bad for the poor and democracy
http://www.profitatanyprice.com/2015/04/free-market-policies-rarely-make-poor.html
Saturday, April 4, 2015
Free-market policies rarely make poor countries rich by Dr. Ha-Joon Chang
Thing 7
Free-market policies rarely
make poor countries rich
by
Dr. Ha Joon Chang
(Book Excerpt from 23 Things They Don’t Tell You About Capitalism)
i think china just found out that their so-called middle class was built on shifting sand and is having a hard time being self sustained.
instead of listening to dim wits like milton freidman, perhaps they should have studied franklin, lincoln, Dr. Ha Joon Chang, etc.
middle classes need to be internally nurtured. to build your middle class on the extinction of someones elses middle class is self liquidating.
chinas belt and road initiative looks like a attempt to me of extending to the world the attempt to sustain a model built on liquidation.
europe is no longer in the thralls of nafta billy clintons free trade, they are beginning to resist and restore production to some degree.
so who is going to sustain chinas middle class?
Dr. Ha Joon Chang.
He does have some very interesting things to say.
I came across him through INET, the Institute of New Economic Thinking, and have watched many/all of his videos there.
hi,
GOOD! once the world figures out that there is a reason why we have borders and countries, the free traders love to throw around the term tribalism, but a government inside its own borders, and controls its own borders, its really called sovereignty and democratic control.
those are the real reasons why free traders attempt to smear the idea of a country, a country that exercises its rights properly, stymies massive wealth extraction by the wealthy parasites.
“Is the answer to withdraw from global trade, as the free traders have caricatured our position? No, it is to go back to a system like the General Agreements on Tariffs and Trade (GATT), which promoted trade but was flexible enough to allow countries policy space to develop and to preserve their intricate social contracts by preventing commodity dumping, environmental dumping, and social dumping.”
Keep in mind that during all these Great Depressions, there was no shortage of valuable jobs to benefit society and no shortage of money to pay for those jobs. When WW2 hit the USA in 1941, overnight there was millions of new jobs and hundreds of millions of dollars to pay for it. There was absolutely nothing to prevent the same response when Great Depressions hit.
The Chinese govt understands this and there will be no Great Depression in China. Although they will never admit it, the Chinese govt clearly knows MMT. Knowing MMT means that whatever happens to their private sector, the Chinese govt know they can create all the good socially beneficial jobs they want, and have all the money they need to pay for it. The people will see the govt as their savior and they’ll be exactly right. And this will make the CCCP even more revered and powerful. China, like the USA, Japan, Canada, etc., has full monetary sovereignty.
The USA will refuse to use the power of MMT, and the USA will dissolve into a 3rd world poverty slum with a few oligarchs running the show.
We have such a terrible recollection of our own history.
http://delong.typepad.com/kalecki43.pdf
In this paper from 1943, you can see the lessons they had learned from the 1930s and WW2.
No one would do anything to improve conditions in the 1930s, apart from the US with the New Deal.
The only thing tolerable was military spending, which is how fascism developed.
They knew Government debt and deficits weren’t a problem as they had seen the massive Government debt and deficits of WW2.
They knew full employment was feasible as they had seen it in WW2.
This is what ushered in the Keynesian era.
All to be forgotten in a few decades.
woodrew wilson set us down the road of stupidity. set us down the road of turning our sovereignty and democratic control over to corporations. he was a true fascist, before the world knew what fascism was.
Remember that the public debt = the private surplus. This is an accounting fact. The public debt is just a number and it has NO negative consequences for the govt. The private surplus, when distributed to the poor and working class, is very valuable for growing the economy and creating employment and raising the standard of living and eliminating poverty.
However, the US govt is captured by oligarchs so almost all of the private surplus goes to oligarchs so they can purchase more mega-yachts, congresspeople and senators.
There is absolutely no need for the govt to “borrow” money. It can create all the money it needs out of thin air and does so every day. About the only use of govt lending is to provide some liquidity to the banking sector. (And most banks should be nationalized anyway.)
china has to quickly turn the corner on what is a sustainable middle class. MMT under something like trumans GATT would be appropriate.
but if they keep relying on liquidating other countries middle classes to sustain this, its not going to work. they need to do a about face pronto!
from carter on in the u.s.a., you could see just how stupid the people were that came into power. tiny little minds, hell bent on the destruction of the middle class.
saying things like look how much that deplorable scores in his/her job that could be done cheaper and more efficient. like cheaper and more efficient for whom?
this is so simple, yet the nafta billy clinton type is stymied by it,
“DEMAND FOR GOODS AND SERVICES IS WAGE DRIVEN!”
when you say that to a free trade dim wit you can see brain lock set into their moronic faces.
nafta billy and greenspan would immediately say no, its cheap money and cheap imports!
but cheap money is still debt, and cheap imports is still debt coupled with the destruction of wages.
TALK ABOUT STUPID!
“Confusing making money and creating wealth is the problem…. no one has the faintest idea what they are actually doing.” So am I crazy, or would a comprehensive audit of all resources necessary for civilization and sustainability serve as the actual basis for credit? And token money, which is essentially meaningless, might not even be necessary in an electronic world. If resources and resourcefulness (beneficial tech advances) are estimated at a quintillion credits total for the planet, and it could also be estimated that this underlying wealth of natural credit might actually be worth more in the future as actual well being is materialized (on a tangent here, sorry) – then the direction is pretty clear. We stop nickel and dime-ing the planet and we start seriously working for a better world. Therein lies all the “wealth.” Who would be able to monopolize that?
“The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. Money will cease to be master and become the servant of humanity.” – Abraham Lincoln
Our slavish devotion to making money causes many of the problems.
Put money in its correct place and lots of possibilities open up.
BINGO!
we are not the richest country in the world. its true we have a lot of money like banana republics have a lot of bananas, but money is not wealth, production like what franklin, lincoln and others envisioned is.
money is simply a form of exchange.
I can’t help thinking there is more to the price rises than is set out in the article. If – as is suggested – the various LPG companies are colluding on prices, it doesn’t make a lot of sense that they’d immediately let them shoot up. It doesn’t take a genius to realise that this would result in a serious political reaction. Its far more likely that they would slowly raise them over time. LPG is mostly cheap because its made from what are often considered waste products from oil production – i.e. ‘wet gas’ – butane and propane. This is the stuff thats usually flared off on small rigs. Where there is enough of it, its ideal for base chemical production near the oil wells, but you need the infrastructure in place for this – presumably an absence of this is one reason that its the primary form of cheap power in Kazakhstan. Its popularity is mostly due to its cheapness and the relative ease of transporting it in countries with poor distribution networks.
My guess is that this was either prompted by a genuine crisis within the industry, or the collusion was not based on generating quick profits, but on deliberately creating a political crisis – maybe one faction trying to use it as leverage against the existing government. I think just blaming ‘neoliberalism’ isn’t enough – there is obvious rentier behaviour going on, but the motivations seem murky. This seems to me to be more about politics than money.
The phased transition began in January 2019 and ended at the beginning of this year. So there were two years for the corporations to find a suitable price range. Right after the first minor protests in Zhanaosen the energy minister Mirzagaliyev announced an investigation on the obvious price fixing by the gas station owners in the region. The next day 2000 kilometers away in Almaty the protesters were demanding resigning of the whole government. Which kinda confused observers, because protests in Kazakhstan tend to stay local due to the large distances and sparse population.
A couple of curious things that have not yet seen much focus. The first is that after the dust settled at least three high ranking security officers have died: two suicides and one heart attack. A purge? A conspiracy? A coincidence?
The second is that Kazakhstan (well, Nasarbayev) was the initiator of Organization of Turkic States, of which Erdogan is the current chairman. And yet, when Kazakhstan needed help, it turned to CSTO (Russia) instead of OTS (Turkey), which more or less wrecked everything Erdogan has been trying to build for years in Central Asia.
Collusion on pricing is standard operating procedure for oligoplies; The question is why wouldn’t the LPG suppliers collude if market design allows it?
What happened in California in 2000 is a prime example. Electricity was deregulated and utilities were forced to supply virtually 100% of supply on the spot market. Generators owned by a very few corporations supposedly decided to take multiple plants off line for “maintenance” during the same time period and the rest is history. I lived in Arizona at the time and oil-fired peaking plants which operated for “hours” each year during 115F summer days ran for weeks on end during winter. Seeing the plumes of water vapor from cooling astonished me; a few days later the story began seeping out. Huge windfall profits were made.
Texas had a similar problem last year, bought about by light or no regulation and bad weather. The knock on effects included huge natural gas prices spikes throughout neighboring states (even as far as Minnesota high rates are baked into residential bills for years in the future! ) because gas is interstate and was subject to the extreme demands in Texas. Huge windfall profits were made.
Wash, rinse, repeat…
There are only 3 solutions to such problems: public ownership and accountability (cf TVA), rigorous regulation by a non-captured regulatory body and anti-trust prosecution (with a corporate death penalty) and/or supplies satisfied by long term contracts with spot markets only for a tiny fraction of marginal demand.
The demand curves for energy are well understood; there are very, very few real surprises. Allowing trading in natural monopolies or oligopolies exists for one – and only one – purpose. Rent extraction by parasites.
The quote of Aynur Kurmanov nails it on the head and applies throughout the rules based international order of the neoliberal “democracies”.
As an aside, I presented a paper at a conference last year. One paper was from Kazakh electric transmission engineer. He mentioned in passing that USAID provided a grant to collect operating data from nodes on the Kazakh transmission system. I was wondering how many zero day back doors were installed in the software. Kazakhstan, of course, is tied to the grid of the former USSR. A lot of mischief (terrorism) could be done.
Here’s some more info on those NGOs in Kazakhstan. It looks like and smell like another color thingy. Pep E. pointed out this might have ended those color thingys.
https://www.globaltimes.cn/page/202201/1245830.shtml
https://www.soros.kz/en/about_us/open_society_foundations/
With friends like this who needs enemies.
Like Amerika the 1% don’t share any money made by selling the countries resources.
“For the working class, LPG, dubbed “road fuels for the poor”, was cheaper than alternative fuels, such as diesel and gasoline, which can cost 180–240 tenge ($0.40–0.55).”
Realistically, how long could those high prices be sustained there for a product already marked for the poor? That would be a question to answer in getting the root cause of this situation.
How much blood can be squeezed from a turnip?
Murray’s opinion matters to me more than most and thus deserves some extra consideration here.
And while I do agree with Yves that we tend to give the CIA too much credit when the agency has not been functioning in ways we tend to think (as well as too little credit in functioning in ways we fail to imagine), I think some of the push back about the color revolution theory driving the left’s intransigence here may have to do with the following:
1. So many Ukrainian articles about Russia invasions or (etc.. – false flags and usual US Propaganda)
2. The importance geographically and geopolitically of Kazakhstan (in between our new/old cold war enemies)
– driving a figurative/literal wedge between them; if you want to disrupt China/Russia, it’s an ideal place.
3. This article by in Covert Action magazine – which discusses the NED, Abiyazov, geopolitical energy policy)
https://covertactionmagazine.com/2022/01/12/national-endowment-for-democracy-provided-1-2-million-to-kazakhstan-to-help-spark-color-revolution-against-pro-russian-and-pro-china-regime/
If there are other readings we should be doing, I am completely open to this as well as the idea of asking Murray if he would like to address any of these perceptions (that he thinks are ludicrous) – I know he has had some health issues and may have more important things to consider at the moment under imprisonment, but I do think it may be a bit early to rule out CIA involvement so certainly but I am full of incomplete information, and only equipped with an instinct which says — this would be the exact type of thing the US would do (ala, Mujahideen or Ukraine etc.).
What if it was MI6 operation? Because that’s the view I’ve come across quite often. Britain has a long tradition of meddling in Central Asia.
What if it was Turkish MIT operation? Which would explain why Kazakhstan sought help from elsewhere (Armenians of all people!) and not from “brotherly Turkic” nation.
What if it was an internal operation? Decent reason to launch a putsch and clean the security forces from supporters of the former president.
Or all of the above?
And by “it” I mean the actual violent rioting, looting and armed attacks on public buildings, not the original protests against fuel prices.
Trying to isolate one cause of a complex process is futile since a constellation of factors is generally operative. Popular grievances owing to the economic situation was foundational AND there were also other factors apparently involved based on many reports. In the final analysis, only intelligence services have the ability to gather and process information comprehensively in such situations, and they aren’t sayin — other than through anonymous sources that push their spin.
Our intelligence agencies do not have a good track record, witness being blind sided by the most similar revolts, Arab Spring, wrong-footing plenty else in the Middle East, and mistakenly pushing the idea that we could install Guaido in Venezuela.
Good point – agree 100 percent about the track record Yves.
It reminds me of a sports analogy though – the middle east fiascos in Syria, Iraq, Libya, Afghanistan et al plus many ventures in Central and South America (especially the pathetic attempts in Honduras or Venezuela), these are the Minor leagues of covert operations – the PNAC people, John Negroponte, Elliot Abrams, John Bolton, Mike Pompeo et al. As you say, lousy track records abound in this group. Embodiment of theToledo Mudhens of Covert Action.
When it comes to Russia and China, though, beyond the media propaganda of Russiagate and the recent “Asia pivot” away from close ties with China in the decade, one wonders if this is a yankees chessboard move (one probably inspired by Z Brzezinski or the group of state department think tanks who believe in “tension”) is more from the Big Boys club of foreign policy major leaguers – Yankees.
The timing of all this coincides with Ukraine flair up as well as heightened security in the S China Sea.
And I think it is important to remember that this is a group of people who think what the US and allies did (Harvard economists) to Russia after the collapse of the USSR (privatization, shock therapy, and opening up markets to the west) was a serious accomplishment of capitalism – instead of the disaster it was for most everyone affected.
Either way though, it is hard to argue that in totality US intelligence are anything but representative of the perpetual rot we witness daily in other areas of America society. However, when it comes to US foreign policy and our enemies, I am very careful to dismiss any of their actions as impossible, especially after reading about Lemnitzer and LeMay’s push for Operation Northwoods (false flag cuban operation) and their willingness to risk thermonuclear war (Strangelove-esque). That was a different time and place, but the cold war ethos seems to be the only thing building back better.
Thanks for the article, read and discussion – much appreciated.
“An estimated 16000 NGOs are operating in Kazakhstan and many are known to be funded by U.S. organisations such as Washington-based National Endowment for Democracy, which funds regime change projects in ex-Soviet republics.”
Good to see Craig call out both of the Western conspiracy theories for what they are.
But the analysis of the Kazakhstan situation is not complete without mentioning two other critical factors:
1. The clan-centric politics of the country
2. The power struggle at the top
As Nazarbayev steps down, his loyal circle is losing their power and access to the ability to extract money from the country. The recently elected president, Tokayev, is replacing them with his own people. Not all of the old guard are willing to go down without fighting. I am not clear exactly on the details, but as I understand it both sides tried their best to utilize the crisis to their advantage. There were reports of weapons handed out to protesters and of security forces being ordered not to show up to work. Armed clashes and a lot of looting, as criminals utilized the opportunity. I am personally wondering if the sudden removal of subsidies was intended to trigger a political crisis.
Meanwhile, those clans outside of government have no political power in the country, which allows them to be economically exploited. They are very resentful about this and want to, at least, the ability to elect their local leaders. Just like in Russia, the opposition is harshly suppressed in Kazakhstan. The pressure built up quietly until the valve was born.
The situation in Kazakhstan is complex and is not enough to cover it from only one angle. But the worst takes, by far, were the knee-jerk reactions from both Western (Putin bad!!!) and Russian (CIA bad!!!) press.
> In 2019, Timur Kulibayev, the son-in-law of the former president, Nursultan Nazarbayev, and one of the richest persons in the country, privatised a large network of petrol stations belonging to the national company KazMunaiGas. He benefited from the subsidy given to LPG as state income was transferred to his company. Then when the price cap was lifted, he benefited from the freedom to charge customers more.
Once again, the nexus of kleptocracy and plutocracy is what constitutes the wretched heart of neoliberal asset capture and rentier capitalism. It is through this organ of corruption and misery that a steak must be plunged to the kill the beast as it were.
Interesting dovetail to the article on the Sino-Russo Marxist schism. It has been my belief since learning about the history of developmental economics as articulated by the West, that China saw this for what it was early. China saw that “Western influence” sought to deliver on the promise that greed was good. China never let western interests penetrate too far, although their experiments with capitalism have created a few “billionaires” who thus far – see Jack Ma – can be easily neutered by the state hammer. The USSR’s devolution stands as further proof was Mao was right, and Krushchev was wrong. The Chinese have largely prevented the West from running the development playbook via resource acquisition, product substitution and market malpractice contagion (see Evergrande). Russia delivered on the greed to local agents, and a few approved outside interests. Kazakhstan, it seems, has followed the same path. Where China has been less successful is in curbing the outsized wealth of members of government. Xi’s Common Prosperity initiative may dampen this in the short term, but sadly, it may be simply a matter of time before a class of wealthy kleptocrats rises to form an entrenched, powerful western style oligarchy in China.
Thucydides, after the siege of Melos, but as the Athenians later learned, the tables can turn.
May the ordinary people of Kazakhstan thrive and prosper. Down with tyranny!
Yves Smith, Sibiryak and several others have summed up well the non-involvement of external intelligence services (CIA, M16, etc). Worth noting that the US and Europe would have little to gain to orchestrate instability given their oil corporations have significant investment in the country.
The issue has now turned into intra-rentier class conflict as Tokayev seeks to grab rent-extracting assets that once belonged to Nazarbayev.