Lack Of Accountability, Ability & Credibility

By Sunil J. Wimalawansa –APRIL 30, 2022

Prof Sunil J. Wimalawansa

Part 6: Sri Lanka—Changing Pillows to Cure Headaches: Lack of Accountability, Ability, and Credibility

Most of the current crises originate from the fiscal/foreign exchange shortage. During the past two years, the currency was pegged to USD and artificially maintained the exchange rate by the former central bank governor, pumping (wasting) vital foreign exchange reserves. Besides, in addition to pilferage, the country is importing more than exporting in dollar terms, and the overly-blown government continues to spend 300% more than it is necessary.

Conflicts of interest and the failure to handle the IMF

The inexperienced and clueless finance minister and the short-sighted governor’s next solution was to monetise (printing) Sri Lankan currencies like madmen, which devalued the Sri Lankan Rupee by half against the USD ignited the inflation. However, they had no effective strategic plan and failed to remedy the foreign currency deficit.

During this period, exports continued to decline, yet the ruling party imported luxury items, including cars, for themselves and the elite. In addition, some ministers and administrators made insane amounts of USD profit by converting the COVID pandemic into an unscrupulous business. This major scandal must be investigated and brought to justice, from PCR and RAT, COVID testing kits, the military-run hotel quarantine and other quarantine scams.

Corruption and lack of experience in handling international affairs

The recent negotiation by the former tarnished (and the current incapable and conflicted) finance minister, who had no relevant education or experience in economics, was a flop. With conflicts of interest, he, the cabinet, and the former central bank governor miserably failed to develop a tangible solution to the economic calamity led to over ten billion losses of the foreign reserves.

The newly appointed minister does not have better economic qualifications or understanding of the intricacies of global politics related to handling loans and debt-restructuring and handling and implementing IMF conditions. Besides, with a negative credit rating and ongoing corruption in the country that cannot hide from the international community, obtaining the eight billion (or more) USD the country seeks from the IMF will not be easier.

Poor leadership, pilferage, and criminal activities

These were conducted in conjunction (or using) the health department and the military. In these deals, they were, apparently profiting between 10% to 90%, in foreign currencies, especially concerning the importation of vaccines. Besides, to use these ineffective vaccines (against new variants) used, the military and police coerced vaccination to make more profit and, as per unconfirmed claims, to finish expired vaccines. These were unethical and violated the constitution and the Nuremberg Code of ethics. None of these violations was investigated.

The lack of foreign exchange due to irresponsible and senseless actions by the government prevented the importation of fuel, cooking gas, essential food and medicine, and prolonged electricity cuts due to the energy crisis. Isn’t it clear who is responsible for this mess? Unfortunately, these situations will worsen before it improves during the next few months. The lack of leadership, direction, progressive policies, and weak political opposition worsened the situation. Consequent lack of food, medicine and energy security affects the entire country.

Absence of accountability and undemocratic actions

As discussed in the previous parts of this series of articles, the root causes for the deepened national debt in Sri Lanka are evident. Continuing begging and browsing are the worst options under these circumstances. The current “consumption” economy must be converted to a “production” economy, and most subsidies (freebees) should be phased out over time.

These actions will reduce the trade gap and budget deficits. It would lead to a new scenario where Sri Lanka never needs to get back to loan traps. However, the magnitude of the fiscal deficit in Sri Lanka has not yet been fully declared. In the past few years, internationally recognised political-corrupt countries like Uganda, Nigeria, and Ukraine, so as Sri Lanka, lacked the transparency and accountability of their executives and legislators.

Significant reduction of tax income while increasing government expenditure, especially those meaningless, non-priority projects done for personal gain, have worsened the financial disaster and phenomenally increased the debt carried by the public. Once the interim cabinet is appointed (in conjunction with the resignation of the president and prime minister), it must increase the tax base at least back to what it was in 2019. It is necessary to introduce a mandatory statute to declare politicians’ “total” income and assets, government servants in senior administrative positions, and all professionals and businesspeople. Failure or false declaration should be considered a legally punishable white-collar crime with jail sentences.

Due resignation of the chief executive and the next presidential election

As per the current constitution, to avoid chaos in the current scenario, it would be advisable to synchronise electing an interim president with the president’s resignation. Under normal circumstances, abolition of the executive presidency needs a two-thirds majority approval of the parliament and then the Supreme Court. Alternatively, this could be accomplished through a nationwide referendum with the presidential or general election to get the people’s approval to (A) abolish the executive presidency, (B) eliminate provincial and other councils, and (C) introduction of the new constitution to replace the current spoiled one, without incurring additional cost.

Suppose the president and/or the prime minister refuse to resign; united opposition should bring a no-confidence motion at the earliest possible to start the ball rolling. If the president refuses to resign/step down, any MP can formally request his removal based on specific reasons provided in the constitution, such as mental instability. Nevertheless, this is a cumbersome process that could take four months needing the Supreme Court and medical evaluations, etc. Currently, there is no such luxury of time.

Failure to accomplish those mentioned above could lead to further turmoil. If so, instead of resigning, the Prime Minister becomes the president with the automatic dissolution of the cabinet. In this worst-case scenario, the country’s situation will be like jumping from the pan to fire—the same crooked politicians will remain in power. Meanwhile, with the revocation of the 20th amendment using a two-third majority, the parliament can depend on either the 17th or 19th amendments for its functioning till the new constitution. The country does not need yet another gimmick, the 21st amendment, which may only benefit the opposition (as per the title of this series of articles).

Summary

Over the past two decades, parliamentarians have focused on looking after themselves rather than the country. For some, it was an open goldmine to loot: they placed the country last on their priority list. Instead of preventing corruption, loopholes in the current constitution provided them with incentives to pilfer funds and profess to act like kings. At the same time, they forget that they are “servants” to the public.

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 Sri Lanka: What is the Way Out of Quagmire

The point is to organise the workers’ power into a force that can challenge the existing regime.

by Ben Curry-1 May 2022

A month has now passed since nationwide anger erupted in Sri Lanka, leaving the ruling class shell-shocked. The movement has shown remarkable resilience. Neither monsoon rains, nor the Sinhala Tamil New Year festivities, nor the shenanigans of a government that knows every dirty trick in the book have succeeded in defusing the rage of the masses. And yet, President Gotabaya Rajapaksa remains stubbornly entrenched in power, mocking the masses by his presence.

The gloves must come off. Yet it has taken until yesterday, 28 April, for the nervous and hesitating trade union leaders to call even so much as a single day of strike action. But however trembling the call to strike might have been, the workers nevertheless responded to it with élan, giving the world a glimpse of their enormous power.

Gota Go Gama

It is worth briefly recapitulating how the anti-government movement in Sri Lanka has developed and the problems that it has posed.

One month ago, on 31 March, without a party or programme, the masses of the Sri Lankan capital, Colombo, came out spontaneously onto the streets to express their seething rage. The Rajapaksas’ regime tried to bare its teeth. Rather than being cowed, the movement exploded into an all-island movement that swamped the government. The briefly declared state of emergency collapsed and the ruling class was thrown into a panic.

The protests have since grown and grown, reaching a decisive turning point with a march on 9 April. The masses from across Colombo and beyond descended on the capital’s Galle Face Green, adjacent to the president’s beach-side office building. The protest was enormous. Over 100,000 attended – a significant show of strength in a city of 700,000 and a country with a population of 22 million people, the majority of whom live in rural districts.

But the protesters didn’t disperse as night fell on 9 April. Rather, they established a permanent tent village. Dubbed ‘Gota Go Gama’ (‘Gota Go Village’), it has become a focal point for the movement, much as the occupation of Tahrir Square in Cairo offered a point of reference for the spontaneous movement of the Egyptian masses in 2011.

The mood at Gota Go Gama has been one of euphoria as the movement – overwhelmingly youthful – has given the masses a sense of the power of their united action. Where the Rajapaksas have used racial division as a political crutch – inciting the Sinhala Buddhist majority of the country against the minority religious and ethnic groups: Tamils, Muslims and Christians – the masses have emphasised their unity and emphatically rejected this poison. All layers of society in every region of the island have been swept into a movement without precedent in decades.

Every evening for three weeks, the permanent protest at Galle Face in Colombo has swelled to 40,000-50,000 attendees. The working class is participating in this movement en masse – but so long as the trade unions refuse to call an all-out strike, they can only do so after working hours.

Despite the anger and militancy of the working class therefore, the permanent occupation at Gota Go Gama has tended to have a disproportionately middle-class character. Students have played a leading role since day one. Lawyers have also played an enormous role in this movement: frustrating the government in the courts, giving free legal assistance to protesters, and organising protests of their own. There have even been a number of instances of police fraternising with the protesters and speaking from megaphones.

And it is no wonder the middle classes have been drawn in in such a way: inflation, blackouts and shortages are crushing the middle layers of society, just as they are crushing the poorest.

According to comrades in Sri Lanka, even the more-affluent supermarkets with a middle-class clientele are now selling firewood. Previously, the middle classes would cook with gas. When that ran out, they switched to kerosene. Once the kerosene ran out, they switched to electricity. But now the power cuts last for so long that even the moderately well-off are cooking on wood fires.

General strike!

The problem the movement faces is that, although they too are being crushed, the middle classes alone cannot decisively resolve the crisis facing the masses.

Neither can the students. They can certainly act as a catalyst, bringing radical, left-wing ideas to the movement, but they are not the decisive force in society. Only the organised working class, concentrated in all the political and economic centres of power, with the tremendous power that comes from its collective action, can paralyse production and bring the regime to its knees.

More than this, the crisis in Sri Lanka is not merely caused by the Rajapaksa dynasty. They are part of the problem. More precisely, they are merely the most degenerate expression of the rottenness of Sri Lankan capitalism. This is a capitalist crisis, and only the working class can offer a way out. All of history shows that the middle classes – being intermediate strata between the capitalists and the working class – cannot play an independent class role.

To both cut across the confusion that exists in the movement, to stamp it with a clear class character, and to deal a death blow to the regime, the working class must enter the scene decisively and take up the leadership of the movement. This is the context of the 28 April general strike. A tidal wave of class anger has so far been dammed up behind the conservative trade union leaders. These ‘leaders’ have trembled at the thought of unleashing the tremendous power of the Sri Lankan working class.

After one whole month of continuous mobilisation by the masses, a coalition of 1,000 trade unions finally called a one-day, token strike that took place on 28 April.

In the current circumstances – when the conditions of the masses are so desperate, and the government so weak – such a call falls far, far short of what is necessary. What the situation at present demands is an all-out strike to bring down the government. In many instances, the call fell short even of a day-long strike. In many cases, rather than calling a strike, workers were called on to phone in sick for the day. And understandably, given the token nature of the strike, doctors, nurses and healthcare workers opted for a two-hour protest so as not to disrupt their vital services.

Despite the union leaders’ prevarications, however, the fact that the strike was called at all shows the immense groundswell within the unions. Even unions affiliated with the ruling SLPP called its members out! And it gave a demonstration for the whole movement of the enormous latent power that the working class possesses.

Workers from the postal service, hospitals, banks, universities, schools, railways, tea plantations, and many, many other sectors came out and flooded the streets. In Colombo, the open air market district of Pettah was left completely empty. Similar scenes were seen across the island as small traders and farmers joined the strike.

Strikes and mass demonstrations were seen in the hyper-exploitative Free Trade Zones in the coastal towns of Katunayake, Awariwatte and Koggala, where predominantly female workforces process garments for the export market.

Towns and cities across the island saw working-class mobilisations, the likes of which haven’t been seen for a generation. From Tangalle (Gota’s heartland in the south of the island), to Jaffna (in the Tamil-majority north of the island), workers came out in large numbers and flooded into the main protests, where they were welcomed with rapturous applause.

Splits in the ruling class

The magnitude of these protests has already opened up serious divisions within the ruling class. In a state of shock, and hoping to save their political skins, in the first days of the movement, the entire cabinet resigned and 42 MPs fled the Rajapaksas’ coalition.

Gota eventually succeeded in forming a new cabinet, but he was forced to omit his family members and his close allies in an attempt to appease the masses. But far from being pacified, the masses sensed that this (largely symbolic) victory was a sign of their power. They now feel that the downfall of the government is within their grasp.

Even the upper echelons of the Buddhist hierarchy – who have worked hand-in-glove with a regime that bases itself on Buddhist chauvinism, and who are now just as despised as the regime by the masses – are demanding some sort of reshuffle at the top!

The majority of the ruling class have decided that Gota is too much of a liability. He is the focus of the masses’ anger, and as long as the masses are on the streets, the ruling class continues to feel that it is standing on unstable ground. But Gota – who was elevated to power by this same ruling class – isn’t too happy about being sacrificed. He is clinging to power with grim determination. And the Sri Lankan constitution makes it very difficult to dislodge a president who doesn’t wish to be dislodged.

He and the opposition are in accord on one thing: both want to see the masses driven off the streets. Rumours are circulating that Gota has even toyed with firing his own brother, the Prime Minister. Even if he commits political fratricide, it will hardly placate the masses. But suspicions of such have only extended the split in the regime all the way into the Rajapaksa family itself. The one option left to Gota is violent repression, and to that end he has given the army powers of policing – that is to say, licence to drive people off the streets under gunfire.

The Rajapaksas are waiting for their revenge the minute the movement ebbs. There is nothing idle about the regime’s threats to ‘police’ the masses with live ammunition. In Gota Go Gama, protesters have erected a gallery dedicated to the Rajapaksas’ past victims: the portraits of the long list of journalists murdered under the last Rajapa ksa government from 2005 to 2015. And on 19 April, the police killed for the first time since the movement began.

An IMF deal?

Both the government and the bourgeois opposition headed by the SJB want the masses off the streets. The opposition advocates the velvet glove because they are afraid that the use of the mailed fist will only enrage the masses further.

But however it is achieved, the whole ruling class is unanimous that it needs ‘Order’. They desperately need an authoritative government that can focus on the pending task of negotiating a bailout from the country’s imperialist creditors. Chronic shortages and blackouts haven’t just plunged the lives of ordinary Sri Lankans into chaos. They are also making it extremely difficult for the capitalists to run businesses, and therefore to make a profit.

To this end – after a period of jockeying between China, India and the IMF – the sitting government has entered into negotiations for a bailout from the latter. A few statements have now been released that give an outline of what such a deal will mean.

This money will not be free. The IMF has explained it will only sign off on a bailout “once adequate assurances are obtained that debt sustainability will be resolved”. What does this mean?

It means the government – with or without the Rajapaksas – will have to balance the books so it can keep paying its debt. That means austerity.

It will mean higher taxes and reduced government spending. It will mean an end to fuel and electricity subsidies, and prices higher even than those currently crushing the masses. It will mean a floating rupee that will depreciate rapidly, making exports cheaper (excellent news for the capitalists) and imports more expensive, further reducing the masses’ living standards.

Let us be clear: a deal with the IMF to “restore economic confidence” and some kind of economic equilibrium will do so at the expense of the workers, the poor and the middle classes. This is what all sections of the ruling class are clamouring for – from the Rajapaksas themselves, to those companies that now feign sympathy for the masses’ struggle.

Hartal

The question is now posed: what next?

It is clear that the trade union leaders are under immense pressure from the rank and file, and the question is being posed of a ‘Hartal’ – a term for an all-out strike, which calls to mind the heroic traditions of struggle of the Sri Lankan working class, stretching back to the 1953 Hartal.

The trade union leaders are now talking about prolonged action from 6 May, although what that means is unclear. But a genuine Hartal, if called, would pose the question of power. It would represent an all-out struggle to depose the government.

But what would the unions propose to replace it with? Healthcare workers’ leader, Ravi Kumudesh, on behalf of some of the striking unions said:

“If the President and the government do not listen to the people and resign in a week, these unions will commence a continuous strike. The President and the government need to understand that they no longer have any legitimacy. They need to resign and hand over power to those who have the confidence of the people.”

But what does this mean? To whom – enjoying “the confidence of the people” – ought the government hand power? As well as the slogans “Go Home Gota” and “Go Home Rajapaksas”, the people have overwhelmingly raised the slogan: “Go Home 225” referring to all 225 members of parliament. In other words, the mass of the people do not have confidence in any party, grouping or individual MP in parliament!

But this mood does not mean that the masses are hostile to all leaders and all organisations. As the reception that the trade unions’ and student unions’ marches received at Galle Face shows: the masses are prepared to give a warm welcome to those organisations who use their strength to advance the movement of the masses. What legitimate suspicion exists is towards those ‘leaders’ who ensnare the masses into lending them political support, only to elevate themselves to power and the privileges of a life in parliament.

The masses, as we have said before, must have confidence only in their own power. But the trade unions are their organisations. The trade unions must therefore organise the fight to seize power, not to deliver it to some other pro-capitalist faction. As we have shown: both the government and their parliamentary opposition have a programme of suffering in store for the masses.

The point is to organise the workers’ power into a force that can challenge the existing regime.

The preparations for a serious struggle must include the forging of such organisation. Hartal committees must be built – in every workplace, in every poor neighbourhood, in every peasant and fishering community. Such organs would keep order and communities supplied during a Hartal, and would thereby begin displacing the functions of the state. And they would begin fraternising with the lower ranks of the army and police, breaking down the old state power along class lines.

Linked up on a district and national scale, they would become the one force capable of securing “the confidence of the people” – for no other reason than the fact that they would actually be formed of the oppressed and exploited people themselves, organised, and under the leadership of the working class.

This is the path forward – the path that leads to the overthrow of the regime, and towards the overthrow of capitalism as the only way out of the misery into which this system has plunged the people.

It is about time that the trade union leaders take this path of struggle, and organise the fight seriously. And if they lack the heart for a fight, they should step aside and make way for those who do!

Ben Curry writer for Marxist.com where this piece first appeared 

A Layman’s long-view of the economy

 

 

by Kumar David-2022/05/1

Experts rarely layout the longer view of Lanka’s impasse in simple words. Political manifestos are all boringly much the same except a difference in emphasis between the roles of state and market. I do not touch on a What Next Programme today; that will have to wait. I wish to take a step back and measure processes not persons. We need first to appreciate that both the consumer side and producer side have been transformed between Independence and now.

In previous times mass consumption needs were simpler; now even the less well-off classes and all but the lowest stratum in the village have more complex expectations; books and apparel for school kids, tuition-masters, consumer durables – fridge, microwave, gas-cooker, a motorbike or a scooter, and money to sometimes take a three-wheeler, better clothes, jeans, shoes, the list goes on. There is explosive growth not only in the amount but also range and variety of consumer demands across the social spectrum. And I must mention the quality of housing and furnishing. This is not the snotty elite; I refer to maybe 70 or 80 percent of people in towns and villages.

A simple agricultural economy as in colonial times cannot generate the surplus required to meet these expectations of a much-expanded population. In an agricultural economy the value of output minus costs of production (including farmers labour time) is too small to generate a net economic surplus to carry this burden. (The plantation sector of course produces a large surplus). This is transformation number one, the consumption side.

There have also been advances to a degree in the production side. Local industry in the broad sense that includes the capitalist sector, state enterprises after the mid-1950s and often forgotten but very important small and medium enterprises (SME) have expanded, somewhat. (The contribution of SMEs to the economy, in production, services – repair shops, computer services and trade – is significant). Still, the gross surplus generated in production is inadequate to (a) plough back for sector expansion and (b) satisfy growing consumer needs.

The extended nature of consumption and the somewhat muted progress in production together characterise Sri Lanka’s stifled transition to economic modernism. I speak here of the economic side, not of life-style, cultural, educational and political progress. Furthermore, alterations in the rural sector has created an excess labour pool that the agricultural economy cannot absorb. This together with population growth has led to a demand by the young for jobs in the modern sector which it cannot satisfy because this sector is struggling to expand.

Allow me to summarise what I have said. There has been a large if not explosive expansion in consumption but a by no means matching response in production. It is also vital to bear in mind that the surplus value (that is output-value net of all costs including labour) created in manufacturing, services, plantations and SMEs, must put aside a portion for expanded reproduction. In other words, a part of the profits in manufacturing must be ploughed back for expanded reproduction. But Sri Lanka is a democracy, every one of us jealously guards our democratic system. When you have growing mass consumption, inadequate surplus generated in production and also democracy, the outcome is inevitable; Political Populism!

Political parties, leaders and budgets have no option but to resort to theoretically off-radar methods not only to survive but also to maintain social stability. Otherwise you get strikes, unsustainable wage demands, hartal-1953, electoral avalanches (1956, 1970, 1977, 1994-Chandrika, 2019-20 Rajapaksa landslides) and now in 2022 an explosion on the streets. I do not gloss over corrupt leaders, rampant robbery by political classes and monumental policy blunders but these subjective elements have to be placed side by side with evolved economic imbalances. The failure of material conditions is more important than the robber barons, but let’s not pause here to argue about chickens and eggs.

You would have observed that I have so far assumed a closed or autarchic economy. That is, I have not said anything but cross-border influences – trade, export-import, foreign investment and indebtedness. In the case of a small dependent economy, in an age where globalisation is sweeping like wildfire across the world and bending even mighty China to its will, to ignore the ‘border’ is like talking about an unclothed emperor.

Take-off into modernism failed in Lanka because economic conditions for take-off did not come to fruition. And add another aspect, nationalism. Sinhala nationalist extremism and its child a Tamil nationalist civil-war undermined economic development. The counter example that is quoted frequently is Singapore. The thesis that basic material factors are interwoven with the independent actions of decision-making elites is not new, some people have a name for it, the dialectic, but never mind, no ideology today.

But there is no escaping that the political dimension influenced the consumption-production contradiction and had deep influence on how take-off into modernism took effect in countries whose economies modernised. The Singapore way curtailed racist-populism but satisfied consumption expectations (housing first), in South Korea the tool was harsh repression till the capitalist class expanded the economy, then the dictatorship was overthrown in the late 1980s releasing the nations democratic energies.

Taiwan’s is far too complicated a story of economic take-off and political democratisation to recount here. These are examples of take-off into economic modernity and democracy. Eastern Europe pulled off economic take-off under the Stalinist gun and democratisation after the Berlin Wall tumbled. Among smaller countries, Cuba, Nicaragua and Venezuela have failed the tests of both democratisation and economic take-off for reasons outside the scope of this essay.

The previous paragraph was something of a digression. I wish to return to the significance of turning away from the autarkic road (closed-economy) to economic modernisation and return to the theme of cross-border flows; that is globalisation, external economic relations and foreign investment. The chances of economic take-off in a closed economy (that is generating sufficient surplus in domestic industry and manufacturing alone to bridge the ever-widening consumption-production imbalance) is zero.

Sri Lanka is the classic example of that failure. We have fiscal deficit, money printing, balance of payment deficits and gigantic foreign debt. Even if Gautama Buddha, Jesus Christ and the Prophet were President, Prime Minister and Finance Minister (in any order) this outcome was inevitable in a country that has for 70 years been unable to raise production to match consumption. In truth Lanka is not a closed economy, but it has not been open enough to modernise production, trade, investment, technology and thinking.

Enter trade and investment

Investment from abroad whether the capitalist West or China is the lifeline if after these chaps take away their profits there is, first, expanding reproduction (growth in production), second a surplus injected in some form (goods, services or money) into local consumption and third employment creation. Employment is another way of saying injecting consumption into the domestic economy. Production has to expand and expand uninterruptedly to meet increasing and diversifying local consumption expectations.

This is where champions of shaving imports down to the bone, eliminating all “luxury” imports, introducing cooperative distribution of necessities and such like frugality, are careless. There is a large element of social justice motivating them; that’s ok but it’s not going to do much good for modernising and expanding production. It also calls for a licence regime; licence-raj as they call it in India.

Allow me to tell you a story about licence-raj. My late uncle Vernon Peries was Director of Family Planning in the 1970s. At one stage there was panic in all the clinics; the essential wherewithal had disappeared from pharmacy shelves. Vernon maama investigated, visited the Treasury and dug out files. Now this was the era when the import of sports goods was prohibited as a luxury. He found that an enterprising official had classified condoms as Sports Equipment and the Customs Department had withheld import licences. That’s a true story, and that’s licence-raj for you.

To get back; does encouragement of foreign investment spell the death of state engagement in the economy? No, in my scheme which envisages a different State from now, there will be directive principles about what investments are welcome bearing in mind the three criteria in the para before my sporting story. I envisage three categories; all-foreign, joint ventures where local and overseas capitalists participate, and in the case of the largest enterprises, joint ventures between the state and big investors.

Sure, investors have to take something away, but it has to be a win for the nation too; Deng Xiao Ping played it well. They left behind the capability of production facilities to survive on their own when it was time to say goodbye. This assumes a government with clear objectives and the ability to implement policy. Observe that I have not touched on technology and productivity enhancement – crucial, but too much for one essay.

What are the benefits? One is rent extraction. Taxes and duties will accrue to the state, that’s a sine qua non apart from the previously mentioned three points. This helps finance populist demands without recourse to deficit budgets. And export earnings will help buy motorbikes, cell-phones, refrigerators, books and blue jeans without falling off the debt cliff. It assumes intelligent political leadership and clear policy; well, if you don’t have that forget the whole discourse anyway.

My mind is on a future progressive regime, so in relation to state-foreign joint ventures what should the role of the state in enterprise management be? Managers of the best international companies are professionals whose loyalty is to the excellence of the company itself; they are rarely the big investor or representatives of share-holders. Similarly, our government and ministerial mutts should keep their grubby fingers out and let able managers get on with it. Younger readers will not know BD Rampala, Vere de Mel and ANS Kulasinghe. The role of the state is only laying out directive principles.

You might object that this is not socialism. Well which idiot said that socialism was possible in one country, and how bizarre to expect it in a tiny island or to expect it even in mighty China in this day and age? But I am not talking about bare-faced capitalism and extraction of surplus value by that class by simple exploitation either. What is the state form in Vietnam, or in China or such indeterminate cases? Not capitalism, but I don’t have a name for it either – a rose by any other name is good enough. As for party programmes everybody says the same thing; raising production and productivity, pruning handouts, cutting expenditure, export orientation and attracting foreign investment of the correct type. Aye there’s the rub; the dichotomy between inordinate market orientation and the directive function of the state. But that’s for another time.

END

(FDI Graphic below)

Vladimir Putin's secret sons: Russian president's gymnast lover Alina Kabaeva, 38, 'gave birth to two boys in 2015 and 2019 in Swiss VIP clinic run by his friend who fled Soviet Union 30 years ago'

• The first boy was born in secrecy in Switzerland amid huge security in 2015
• Second son was delivered in Moscow in 2019 with the same specialist present 
• The Russian leader has denied a relationship with Alina Kabaeva since 2007
• He has hidden his alleged secret family from voters and did not attend the births 

By WILL STEWART FOR MAILONLINE-1 May 2022 

Vladimir Putin has two secret sons by his gymnast 'lover' Alina Kabaeva, according to a new report today.

The first boy was born in secrecy in Switzerland amid huge security in 2015, according to a source linked to the obstetrician who was at the birth.

The second son was delivered in Moscow in 2019 with the same specialist flying to Russia for the birth, according to an investigation by Swiss broadsheet newspaper Sonntagszeitung.

The Russian leader, who will be 70 this year, has since 2007 denied a relationship with Olympic gold-medal winning Kabaeva, now 38.

He has hidden his alleged secret family from voters - and was not present at either of the births.

The report confirms strong rumours over a Putin-Kabaeva family, except in suggesting there was one son born in 2019 rather than twins.

It also indicates that Kabaeva is the secret Russian first lady at a time when the country is suffering major losses from the war with Ukraine.

Alina Kabaeva shakes hands with Vladimir Putin during a meeting with other gymnasts in the Kremlin. Putin has, since 2007, denied having a relationship with the Olympic gold-medal winner

 

Putin awards Kabaeva with the 'For Merit to the Fatherland' order in 2005 in Kremlin, Moscow

2015: Putin's mistress seen heavily pregnant at gymnastics event

 

The source of the new report - published today - is said to be a personal friend of Kabaeva who also knows the obstetrician, an unnamed Soviet-born medic acquainted with Putin for more than three decades and a long-time Swiss citizen after emigrating from Russia.

The paper reported: 'Our source says clearly: "Alina's relationship with Putin existed. Their children - two sons - are Putin's children. Alina had no other relationship. That would have been too dangerous for her".'

The female doctor works at Clinica Sant'Anna in the Italian-speaking Ticino region of Switzerland where the first child was born.

The obstetrician had 'maintained a trusting relationship with Putin', said the report.

'You had to keep the whole thing very discreet,' the newspaper was told.

Contrary to gossip in 2015, Putin was not present at the birth which - at the time - the Kremlin denied.

There was also only one Putin-Kabaeva child born in Switzerland, said the source.

By the 'president's decision', the second son was born in Moscow.

The same Russian emigre Swiss obstetrician delivered the second son in Moscow in 2019.

Before the birth, Kabaeva had traveled in secret to Lugano several times.

The source described Kabaeva as 'a very pleasant woman.

'She is a real sportswoman, very straight, without posturing.

'She came with her mother and sister, but without bodyguards.'

Despite this, a blanket of secrecy was thrown over the births.

Putin hands Kabaeva a bouquet of flowers on the day she received the 'For Merit to the Fatherland' order in 2005

Kabaeva had also travelled multiple times to Switzerland before starting her relationship with Putin, believed to be in 2007.

She was an ambassador for Longines watches from 1999 to 2008.

Recently, rumours suggested that she and her suspected young children were hiding out from the war at a reclusive Swiss chalet.

However ten days ago - after a four-month absence from the limelight - she reappeared in Moscow.

There are indications she has spent time near Geneva at the Cologny residence of Gennady Timchenko, 69, an oligarch very close to Putin.

Timchenko's representatives refused to comment to the Sunday newspaper.

Swiss government representatives say there is no indication Kabaeva has been in the country recently.

The young woman identified as Putin's daughter, known as both Elizaveta Krivonogikh and Luiza Rozova

A video shows Kabaeva in May 2015 - which at the time sparked rumours of pregnancy - at her annual gymnastics show for children called 'Alina 2015'.

At the time she said: 'The children performed brilliantly.'

Putin has two officially acknowledged children — Maria, 37, and Katerina, 35, both from first wife Lyudmila.

Dr Maria Vorontsova - a year younger than Kabaeva, who was born when the Russian president was a KGB spy in Germany - is an expert in rare genetic diseases in children.

She is a leading researcher at the National Medical Research Center for Endocrinology of the Ministry of Health of Russia.

Her divorced sister Katerina is deputy director of the Institute for Mathematical Research of Complex Systems at Moscow State University.

She is a former high-kicking 'rock'n'roll' dancer.

Both daughters have been sanctioned by the West, unlike Kabaeva, and Putin's unacknowledged 'love child' Luiza Rozova, 19.

Luiza is the daughter of cleaner-turned-multimillionaire Svetlana Krivonogikh, 45, now part-owner of a major Russian bank, one of the country's wealthiest women with an estimated £74 million financial and property fortune.

Kabaeva used the build-up to last weekend's 'Alina 2022' show in Moscow to make her first appearance in public since the war started in Ukraine.

This followed rumours she had been hiding in Switzerland - or in a hi-tech Siberian nuclear bunker.

At the show itself she was filmed in front of the 'Z' symbols of Putin's troops, which critics have likened to a swastika symbol.

Putin pictured alongside Kabaeva at a gymnastics festival in Russia in 2001

She wore a £1,915 from a British-based designer as she led a patriotic-themed gymnastics ballet in which she linked the defeat of Hitler's Nazis to the Russian fight against Ukraine.

The event included some of the Soviet Union's most patriotic songs in a celebration of the country's victory over the Germans.

The theme at her annual festival was unmistakably intended to boost patriotic support for Putin's military adventure in Ukraine.

She wore a wedding ring and a fluid silk fuchsia midi dress from the new collection of London-based Alessandra Rich who has previously supplied David Cameron's wife Samantha - for a state occasion with President Barack Obama - and a host of A-listers.

Russians were struck by Kabaeva's new look last weekend, sparking rumours of recent cosmetic surgery.

Russian Cosmopolitan said 'something has really changed in Kabaeva's face', adding that 'the legendary athlete was noticeably prettier'.

Avoiding linking her to Putin, it said of a woman widely believed to be Russia's unofficial first lady: 'Alina Kabaeva is one of the most mysterious and secretive women in our country.

'The gymnast almost never appears in public, does not [appear in] social networks, and it is not possible to accidentally see her on the street or in shopping centres.'

Telegram channel Tol'ko Nikomu - also choosing its words carefully to avoid the Russian censor - hinted that she and Putin share the same plastic surgeon.

'A new rare appearance of Alina Kabaeva. This time she is dressed casually - and is again seen with a wedding ring.

'And yes, the handwriting of the family beautician is quite notable.'

Alina Kabaeva at the 2015 'Alina' gymnastics festival on May 21, 2015, in Moscow, Russia

Jailed Putin foe Alexei Navalny has demanded sanctions against Kabaeva.

He singled out Kabaeva's National Media Group arguing that it was likely owned by Putin - who will be 70 this year - personally.

Her salary here has been estimated at almost £8 million a year, compared with the average annual figure of £5,600.

Navalny posted from jail: 'I want to remind you that the National Media Group, which owns the lion's share of this apparatus of lies, undoubtedly belongs to Putin personally, and as such is even formally headed by Putin's mistress Alina Kabaeva.'

He called her a Putin propagandist and said she should be treated as a 'war criminal'.

Kabaeva has kept a low profile in the Ukraine war - but her media has been vocal in cheerleading for Putin.

Soon after the war started, a petition called on the Swiss authorities to send her packing back to Russia.

'It's time you reunite Eva Braun with her Führer', said the petition.

Rumours first linked her romantically to Putin as long ago as 2008 when she was a pro-Kremlin MP.

The newspaper printing the story was rapidly closed down.

Putin alongside Kabaeva at another event held at the Kremlin, in Moscow, Russia

Putin - who in 2013 announced his divorce from wife Lyudmila, a former Aeroflot stewardess - has previously said: 'I have a private life in which I do not permit interference. It must be respected.'

He deplored 'those who with their snotty noses and erotic fantasies prowl into others' lives'.

Kabaeva is on record as saying she had met a man who 'I love very much', gushing: 'Sometimes you feel so happy that you even feel scared.'

In 2001 Kabaeva was temporarily banned from competing in rhythmic gymnastics after failing a doping test.

A year earlier she had won gold at the 2000 summer Olympics.

Once regarded as Russia's most eligible woman, her only other suitor has been a married Georgian policeman, according to media reports.

This relationship petered out in 2005 amid complaints of tabloid intrusion into her life.

She once posed almost nude for Maxim and was described as 'full of sex' by a photographer.

There have been many reports of her wearing a wedding ring, but no records of a marriage.

She is reported to have a fleet of Maybach limousines at her disposal, and was seen surrounded by a squad of machine-gun toting security guards on visits to a Moscow cafe, likely indicating she qualifies for state-level security.

Many Russians saw her as the reason for the breakup of Putin's marriage to ex-first lady Lyudmila, 63, mother of his two adult daughters.

The dictator of neighbouring Belarus, Alexander Lukashenko hinted that Putin's divorce decision came about because Kabaeva 'put pressure on the president'. 

Brutal sect of Chechens executed RUSSIAN troops in Ukraine: Kadyrovtsy fighters shot wounded comrades dead at 'field hospital' and operated a torture chamber near Bucha where civilians were massacred, claim witnesses

By Kaya Terry 

A brutal sect of feared Chechen soldiers executed 'heavily wounded' Russian troops in a 'field hospital' that was situated northwest of Bucha, eyewitnesses have claimed.

The Kadyrovtsy, who have been used as a PR tool in Vladimir Putin's war, allegedly murdered their own comrades and 'operated a torture chamber' in a glass factory on Yablonska Street - confirming previous reports by Ukraine's ombudsman for human rights, Lyudmila Denisova.

Artem Hurin, a member of the city council of the neighboring town of Irpin who also serves as a deputy commander in Ukraine's Territorial Defense Forces, was one of the first to visit Borodyanka, northwest of Bucha, after the Putin's soldiers retreated last month when Ukrainian forces recaptured the town on April 2.

He said: 'They would bring heavily wounded Russian soldiers to a big hospital they had there, and those who were very heavily wounded, they would just shoot them. No one other than the Kadyrovtsy did this.' 

Hurin recalled the litany of horrifying stories from residents who were tortured and raped by lawless Russian troops and saw evidence of 'executed civilians' who lay dead on the street, the Daily Beast reports. 

According to residents of the town, the killer squad of Chechen fighters - known as Kadyrovtsy - had executed people as early as March 5. 

The revelations came as Ukraine said the first group of civilians were safely evacuated from the steel plant in the besieged city of Mariupol on Saturday night.

A Ukrainian fighter, who had sheltered in the network of underground rooms and tunnels located underneath the factory since mid-April, said a group of around 20 women and children had managed to get out - but a reported 1,000 people are currently still stuck underneath the plant.

Sviatoslav Palamar, Azov regiment deputy commander, told Reuters: 'We are getting civilians out of the rubble with ropes – it’s the elderly, women and children.'

 

A brutal sect of Chechen soldiers executed 'heavily wounded' Russian troops in a hospital that lies northwest of Bucha , witnesses have claimed. Pictured: A group of Chechen fighters have been seen on video wildly firing heavy machine guns towards residential buildings in Ukraine's besieged city of Mariupol

The Kadyrovtsy, who have been used as a PR tool in Vladimir Putin's war, allegedly murdered their own comrades and 'operated a torture chamber' in a glass factory on Yablonska Street

Collapsed building is seen as civilians are being evacuated along humanitarian corridors from the Ukrainian city of Mariupol under the control of Russian military and pro-Russian separatists, on March 26, 2022

 

Pictured: The feared Chechen unit - known as Kadyrovtsy - in Mariupol holding firearms in front of a burning building 

Chechen fighters fire their weapons into the distance in Ukraine

 

Kadyrovtsy speaker (pictured in the centre) filmed a video in Mariupol last month and said: 'An order to destroy and purge Mariupol is fulfilled. The order of president Putin is fulfilled, the order of Kadyrov is fulfilled'

The Chechen military is known for its Hollywood-inspired videos claiming to show their soldiers in action, while actually showing them doing very little. Experts say the videos are just another branch of Putin's propaganda efforts

President Volodymyr Zelensky (right) is pictured earlier today with US House of Representatives Speaker Nancy Pelosi (left) before their meeting in Kyiv

One woman recalled how she endured four days of torture by one Kadyrovtsy soldier and one Belarusian soldier before they brutally shot her husband in the head.

Meanwhile, the Bucha Mayor, Anatoliy Fedoruk, claimed Chechen troops tied white bands around prisoners' arms who were captured, which were similar to those found on the bodies of executed civilians in the city.

Opening up about civilians who attempted to leave their homes to get food and water, Hurin added: 'They didn't allow them to do anything. There they just killed people through binoculars for example. They just shot them.' 

Many Chechen soldiers were fighting alongside the Russian military, which waged two wars against Chechnya – a Muslim republic in southern Russia – between 1994 and 2000. 

As the towns around Kyiv which were recaptured by Ukrainian forces have revealed horrific atrocities, with the bodies of hundreds of dead civilians piled up after Putin withdrew his band of thugs.

 

Pictured: Ukrainian soldiers arrive at an abandoned building to rest and receive medical treatment after fighting on the front line for two months near Kramatorsk, eastern Ukraine on April 30

One woman recalled how she endured four days of torture by one Kadyrovtsy soldier and one Belarusian soldier before they brutally shot her husband in the head. Pictured: A wrecked bus is seen as civilians are being evacuated along humanitarian corridors from the Ukrainian city of Mariupol

Pictured: Several Ukrainian soldiers line up at an abandoned building to rest and receive medical treatment near Kramatorsk on April 30

Russia has denied targeting civilians despite the many stories of gang rape, sexual abuse in front of children, torture and executions to emerge from the barbaric war. Pictured: Service members of pro-Russian troops drive an armoured vehicle during Ukraine-Russia conflict on a road outside the southern port city of Mariupol

Pictured: Ukrainian soldiers are seen unloading their guns to receive medical treatment on April 30 near Kramatorsk, eastern Ukraine

Russia has denied targeting civilians despite the many stories of gang rape, sexual abuse in front of children, torture and executions to emerge from the barbaric war.

A United Nations mission to Bucha documented 'the unlawful killing, including by summary execution, of some 50 civilians there', the UN's Office of the High Commissioner for Human Rights said.

Forensic tests carried out on civilian corpses dumped in mass graves in the Kyiv region show women were raped before being brutally killed.

Dozens of autopsies have been carried out on mutilated corpses from Bucha, Irpin and Borodianka, with many showing signs of torture and multiple bullet holes in the back.

Some have been so badly disfigured or even decapitated that investigators have been unable to identify them.

Vladyslav Pirovskyi, a Ukrainian forensic doctor who carried out the autopsies, told The Guardian: 'We already have a few cases which suggest that these women had been raped before being shot to death. 

'We can't give more details as my colleagues are still collecting the data and we still have hundreds of bodies to examine.'

His team has been analysing 15 bodies a day, with most killed by automatic gunfire.

He added: 'There are many burnt bodies, and heavily disfigured bodies that are just impossible to identify.

'The face could be smashed into pieces, you can't put it back together, sometimes there's no head at all.'

The evidence has been passed on to the region's senior prosecutor, Oleh Tkalenko, for further investigations.

This comes as a group of Chechen fighters were seen firing heavy machine guns towards residential buildings in Ukraine's besieged city of Mariupol, on a video released on TikTok last month.

Aftermath image of the Drama Theatre in the encircled Ukrainian port city of Mariupol where hundreds of civilians were sheltering on Wednesday March 16, 2022

Damaged buildings are seen as civilians are being evacuated along humanitarian corridors from the Ukrainian city of Mariupol under the control of Russian military and pro-Russian separatists, on March 26, 2022

 

Pictured: Ukrainian soldiers arrive at an abandoned building to rest and receive medical treatment after fighting on the front line for two months near Kramatorsk, eastern Ukraine on April 30

The footage, shared by Kremlin-allied Chechen warlord Ramzan Kadyrov, also showed the Chechen soldiers seemingly celebrating as the camera panned to show the hollowed-out shells of destroyed apartment blocks.

The soldiers, dressed in camouflaged military gear, pumped their fists to the camera and could be heard shouting 'allahu akbar'.

On his Telegram channel, Kadyrov claimed his fighters were clearing 'the territory of the Nazis' - parroting a line used by President Putin and his propaganda machine to justify the invasion of Ukraine.

Mariupol has seen some of the most intense fighting since Putin ordered his armies into Ukraine on February 24. Russian forces have been shelling the city indiscriminately, razing large swathes of the city.

Officials say at least 2,400 civilians have been killed in the southern port city, but it is feared that the true toll is much higher. One official said earlier this month that he feared as many as 20,000 people could have been killed.

The Chechen military is known for its Hollywood-inspired videos claiming to show their soldiers in action, while actually showing them doing very little. Experts say the videos are just another branch of Putin's propaganda efforts. 

Kadyrov's video also showed his soldiers climbing through the window of a building, seemingly to help a civilian out. However, while the soldiers were passing a mattress between then, the footage did not actually show anyone being carried.

Instead, one grinning fighter wearing sunglasses panned his camera around to show the scene of devastation around him, in a style that - anywhere else in the world - could be mistaken with a selfie-video from an Instagram influencer.

In a separate TikTok video released in March, Chechen special forces were filmed fighting house-to-house in besieged Mariupol while 'hundreds' of women and children remained trapped in the rubble of a city theatre destroyed by Russian invaders.

The footage, said to have been released by pro-Putin Chechen warlord Ramzan Kadyrov, shows heavily armed fighters from the region pounding a high-rise building in the bombed-out city during a fierce gunfight with Ukrainian soldiers.

The propaganda video then cuts before showing some of the Chechen fighters emerging from the building with children in their arms while supposedly 'liberating' civilians.

The video emerged as hundreds of people were still feared trapped under the rubble of a theatre in the devastated city that has been obliterated by Russian forces who control the overwhelming majority of the city and are mostly focusing their airstrikes on the Soviet-era steel plant located close to the harbour, where a contingent of between 1,000-2000 Ukrainian soldiers are staging a desperate holdout alongside roughly 1,000 civilians.

Chechen troops have been embedded in the National Guard of Russia and have been fighting in Ukraine since the start of the invasion. 

Feared Chechen special forces shared a video in March showing them fighting house-to-house in besieged Mariupol while 'hundreds' of women and children remain trapped in the rubble of a city theatre destroyed by Russian invaders

The propaganda video then cuts before showing some of the Chechen fighters emerging from the building with children in their arms while supposedly 'liberating' civilians

The video released by pro-Putin Chechen warlord Ramzan Kadyrov shows heavily armed fighters from the region pounding a high-rise building in the bombed-out city during a fierce gunfight with Ukrainian soldiers

Meanwhile, Ukrainian President Volodymyr Zelensky (pictured) switched into Russian in his nightly video address to urge Russian soldiers not to fight in Ukraine, saying even their generals expected that thousands of them would die

-

Chechen fighters shout 'Allahu Akbar' and fire shots at building

 

One squad of Kadyrov's fighters was reportedly sent to try and assassinate Ukraine's president Volodymyr Zelensky, but was destroyed by Ukraine's forces.

Meanwhile, Ukrainian President Volodymyr Zelensky switched into Russian in his nightly video address to urge Russian soldiers not to fight in Ukraine, saying even their generals expected that thousands of them would die.

He said Russia has been recruiting new troops 'with little motivation and little combat experience' for the units that were gutted during the early weeks of the war so these units can be thrown back into battle.

He said Russian commanders fully understand that thousands of them will die and thousands more will be wounded in the coming weeks.

'The Russian commanders are lying to their soldiers when they tell them they can expect to be held seriously responsible for refusing to fight and then also don't tell them, for example, that the Russian army is preparing additional refrigerator trucks for storing the bodies,' Mr Zelensky said late on Saturday.

'They don't tell them about the new losses the generals expect. Every Russian soldier can still save his own life. It's better for you to survive in Russia than to perish on our land.'

It comes as Sweden said a Russian military plane violated Swedish airspace. The incident happened late on Friday in the Baltic Sea near the island of Bornholm.

In a statement on Saturday, the Swedish Armed Forces said a Russian AN-30 propeller plane flew toward Swedish airspace and briefly entered it before leaving the area.

The Swedish Air Force scrambled fighter jets which photographed the Russian plane.

Swedish Defence Minister Peter Hultqvist told Swedish public radio that the violation was 'unacceptable' and 'unprofessional'.

In a similar incident in early March four Russian warplanes violated Swedish airspace over the Baltic Sea.

Sweden and neighbouring Finland are both considering Nato membership following Russia's invasion of Ukraine. Moscow has warned that such a move would have consequences, without giving specifics.

Meanwhile, Russia has been forced to merge and redeploy depleted and disparate units from failed advances in northeast Ukraine, a British military update said on Saturday.

'Shortcomings in Russian tactical coordination remain. A lack of unit-level skills and inconsistent air support have left Russia unable to fully leverage its combat mass, despite localised improvements,' the military tweeted.

'Russia hopes to rectify issues that have previously constrained its invasion by geographically concentrating combat power, shortening supply lines and simplifying command and control,' it said.