Putin Compares European Union and Soviet Union: EU Will Probably Not Survive In Its Current FormOn January 11, 2020 by Raul Dinwiddie
Thank you, my name is Ray Zucaro from the United States, from RVX Asset Management. Thank you VTB Capital and, more importantly, thank you, President Putin, for showing up. Now I say look at the world today. I can’t help but see some parallels with what was the Soviet Union and what is the European Union today. I see a fusion of different peoples, of different cultures, with different languages, all unified under a common banner, with a single currency supported by a central entity, supporting the satellite nations of the European Union with the idea of a greater good. I see the Europeans’ essential bank creating money out of thin air, out of pixy dust, trying to buy the member states together. Artificial rates have replaces what cheap energy and military presence was for the Soviet Union. I can’t help but wonder if Brexit is similar to what happened in the Soviet Union in 1988 with the rise of nationalism in Kazakhstan, in the Baltics – a precursor to its eventual falling apart. So my thoughts are, and my question specifically is, what are your views on the European Union given your pre-imposed Soviet Russia? Regarding the breakup of the Soviet Union, it had little to do with the rise of nationalism in the Baltics. The basic reason was, of course, an ineffective economic policy, which promoted a social collapse and also had a prolonged effect in the political sphere. Incidentally, the People’s Republic of China has used the possibilities offered by centralised management and the market economy very wisely. We are analyzing its achievements, as our Chinese colleague will tell you. We see that when tenders are held there [for the allocation of funds] from the central sources to micro-level, people are fighting for these contracts. Why? Who is involved? These are economic operators who are working in market conditions, and who are very effective. I will not go into detail now regarding the US and China accusing each other over the yuan rate and so on, but these are the instruments that are being used very effectively. The Soviet Union did nothing of the kind, and the results of an ineffective economic policy hit the political sphere. The consequences of its collapse were much worse than people could imagine in their worst dreams. I am not going to talk about this now. This is not the place or the time to do this. As for the European Union, you can draw parallels, although there are some multinational EU countries. I mentioned this before, and these are not my own data but the information provided by my colleagues from some EU countries. Here it is: the European Parliament adopts more decisions that are binding on all the EU countries than the USSR Supreme Soviet ever adopted decisions regarding the union republics. A comparison is possible in this sense, although the greatest difference is that the Soviet Union was an integral and strictly centralized country, unlike the European Union. Back during WWI, there was a scenario for creating the United States of Europe, or the European Federation, but it never came to fruition. The European Coal and Steel Community (ECSC) was created after WWII, and so it went on and on. And now we have the European Union. However, differences have developed practically overnight, based on practical problems. I do not believe that British taxpayers like paying their taxes when they know that the bulk of their money, and we are talking about tens of billions of euros, will be used to pay for the basic needs of societies that have not reached a certain level of economic development. There are other factors. The decisions taken by the European Parliament ultimately affect all the EU member states. Of course, not everyone likes this. I do not think I have the right to make any assessments, but I would like to draw your attention to the following: somewhere on the threshold of 2028, some Eastern European countries will have already reached the economic development level and will not receive grants or various kinds of support from the pan-European budget. They will have to pay, like Britain has to this day. And I am not sure they will not have the same ideas as Britain does now. So, of course, for the European Union to keep going… Incidentally, we are interested in this. We in Russia want to deal with a predictable and understandable partner. We watch with concern what is happening there. A considerable part of our gold and currency reserves are in euros. Despite the decline in trade after various sanctions (trade dropped from $450 billion to about $300 billion) it has started to rise, and the EU is still a major trade and economic partner. So we are interested in everything being maintained and functioning normally. That said, we are analysing what is happening there and, of course, what will happen there in the future. Your question: can the EU be compared to the USSR? I think the answer is “no.” This is a completely different thing but some parallels are possible. I do not know whether it will be possible to save the EU in its current form, taking into account a few trends I mentioned. But I know that European leaders are aware of this and are certainly thinking about this problem. They have different scenarios aimed at consolidating the EU and making integration more sustainable. I do not know if they succeed but in any event I wish them success.