What happened at the Russian Davos?

What happened at the Russian Davos?

Alexander Smukler of Montclair continues his analysis of Putin’s war against Ukraine

Putin speaks at the 2019 Saint Petersburg International Economic Forum. (Presidential Press and Information Office)
Putin speaks at the 2019 Saint Petersburg International Economic Forum. (Presidential Press and Information Office)

As the war that Russia began when it invaded Ukraine on February 24 enters its fourth bloody month, our analyst, businessman and Soviet-Jew-turned-American Alexander Smukler of Montclair talks about what Russian media and his contacts tell him, and what he sees coming.

First, he described what’s going on at the front, and it’s grim.

“During the last week, the Russians haven’t really gained a lot — they are moving very, very slowly — but they are moving,” Mr. Smukler said. As he explained last week, Russia’s President Vladimir Putin — the Angry Dwarf, the emotionally and spiritually stunted man whose desire to bring back the Russian Empire and become Peter the Great’s successor have fueled this war — has decided that it is more politically important for him to keep Russian soldiers alive by destroying the Ukrainians in this way than he had realized at the beginning. Therefore, instead of throwing young men into a war they had not been prepared to fight — as of last week, sources estimated, horrifyingly, that somewhere between 32,000 and 37,000 troops had died — Putin is bombarding Ukraine to smithereens.

“The major battlefield now is Severodonetsk, but that battle is coming to an end,” Mr. Smukler said. “The Russians already control the city, and this is the last big city in the Donbas area. Soon they will control all of Donbas. There’s just one more small town, called Lisichansk, that the Russians do not control, but as soon as they finish with Severodonetsk they will start taking it over.” Once that happens, it will be over for the Donbas region.

There’s one slight problem with Severodonetsk, though. “There’s a big chemical factory there, called Azot,” Mr. Smukler said. “It’s history repeating itself.”

The history is what happened in the similarly named, similarly massive Azovstal steel plant in Mariupol; there, Ukrainian civilians and members of the Ukrainian army, along with members of the Azov Regiment, known as much for its Nazi-affiliated past as for its Russian-fighting present, lived, fought, were besieged, were surrounded, were starved out, and eventually were (or, it turned out, were not) ordered by the Ukrainian government to surrender to the Russians. (All of these names come from the Azov Sea, an arm of the Black Sea that is between Russia and Ukraine.)

“There are a large group of civilians — probably about 500 of them — and military who are hiding and defending that industrial area,” Mr. Smukler said. “Probably they will be besieged, exactly like in Mariupol, and probably they will end up surrendering.”

But there’s a complication. “Experts are saying that the Russians are hesitant about bombing and using heavy artillery, like they did in Mariupol, because this plant has huge reserves of chemicals, especially chlorine. Nobody knows what the impact would be if it explodes.”

The city’s not close to Russia, he said, “but it is not far from Donetsk.

“The Russians are afraid of what might happen.

“But still, we are coming to the end of the battles for the Donbas. After Severodonetsk and Lisichansk, the Russians will control all of the region.”

That would present a public-relations problem for a regime that cared about public relations.

Alexander Smukler of Montclair

“Putin told everybody that the Russians went to Ukraine to help liberate Donetsk and Luhansk from neo-Nazis,” Mr. Smukler said. “But obviously they will not stop. So the question is what the propaganda will be. How will they explain why they are moving forward?

“They already control two areas beyond the Dombas. One is Zaporizhzhia, the city that is the capital of the Zaporizhzhia Oblast. It has the largest power station in Europe.

“When the Russians take it over it will create enormous problems for Ukraine, because Zaporizhzhia’s nuclear power stations supply a substantial amount of Ukraine’s electricity.”

The bad news for Ukraine keeps coming.

“I heard that the Russians have started to regroup their army and are preparing to attack Kharkiv, which I remind you is the second largest city in Ukraine, with a population over one million,” Mr. Smukler said. “It is a mostly Russian-speaking town; before the war, 90 percent of the people who lived there were ethnic Russians. It’s the Ukrainian big city that’s the closest to the Russian border.

“The Russians tried to take it over at the beginning of the war, but they were not able to.” They retreated. “But today several experts say that they’re planning to try again.

“So today, it is absolutely clear to everybody that the Russians are not going to stop with the Donbas. Obviously, the war will continue, and Putin will move forward. I think that he will plan to take Nikolaev and Odessa and cut Ukraine off from the Black Sea ports.

“That’s in the future, not now” — because the war hasn’t gone as Putin had planned — “but obviously they won’t stop their ‘special operation’” — Putin so far has not formally declared war but uses less definitive language when talking about his war — “just because they already control Donbas, no matter what they were saying at the beginning of the war.”

So what is Vladimir Putin saying?

He’s been giving speeches all over recently, but the biggest, splashiest recent one was the 90-minute talk he gave at the St. Petersburg International Economic Forum.

Here’s some background.

The forum — the Russian Davos, as it’s been called — began in 1995, when Russia seemed to be shedding its Soviet past and looking westward. It attracted hundreds of thousands of businesspeople from hundreds of countries, many of whom thought it was possible that Russia was going to be the next big thing. “I attended that forum several times during my business life, and I have to tell you that in the old days, before 2014” — when Russia invaded and annexed Crimea, and the West levied some tentative sanctions as a result — “it was a major gathering,” Mr. Smukler said. “Investors from around the world came to Russia to develop business. You could see leaders of major European and American corporations.

“During this meeting, I did not notice even one known face from Western countries of the business world,” he continued; of course, all the faces he saw this time were on television or social media. “I saw a lot of people from African countries, from China, from the Middle East, and surprisingly, a delegation of Taliban from Afghanistan.

“There was a large group from India, and for the first time, there was a big delegation from Egypt. But not one company or representative from the First World.

“I also didn’t see anyone from Israel,” he added. “I watched. I haven’t seen any mention of any Israeli companies or businesses that were there.”

This time, only two world leaders other than Putin gave speeches. Neither actually was there; both spoke on Zoom. One was Xi Jinping, the president of China; the other was Abdel el-Sisi, the president of Egypt.

Rabbi Pinchas Goldschmidt speaks in Paris in 2018. (Conference of European Rabbis)

There was only one high-ranking politician who was physically present, Mr. Smukler continued. That was Kazakhstan’s president, Kassym-Jomart Tokayev, who was on a panel with Putin.

Putin’s speech — an interminable Castro-style stemwinder — “described the economic situation,” Mr. Smukler said. “I was laughing listening to him. In his speech, he blamed the whole world. He said that Russia’s economic problems are not connected with the special operation in Ukraine and the sanctions implemented against Russia are not working effectively against the Russian economy, which is so strong now that it never has been stronger.

“Russia’s currency is very strong now,” Mr. Smukler said, and Russia is now selling 50% more oil and gas to China than it was before February 24. He said that Russia almost doubled its sales of mineral resources and gas to India since that time, and in general, sanctions are not hurting the Russian economy.

“Putin said yes, we are going to have a difficult time, but that will make our country much stronger than it was before, because we are going to start producing many of the things that we have been buying from the West. We will become much more self-sufficient.”

Of course, Mr. Smukler continued, Putin did not mention such problems as the airplanes that no longer fly and the heavy machinery that does not work because both the products and the spare parts necessary to maintain them come from the West, and no longer are shipped to Russia. “He did not mention how many companies left Russia since February 24. He only mentioned that Europe will lose approximately $400 billion by implementing the sanctions, so the West has shot itself in the foot.”

Also, Mr. Smukler said, without mentioning President Biden by name, Putin said that the American administration is blaming him for inflation. But nothing is Russia’s fault, he said; “no one in the West could anticipate how the sanctions they implemented — he called it the economic war against Russia that they started — would affect them.

“And Putin also said in his speech that ‘We are not going to stop the special operation in Ukraine. We are not even close to the end. It will continue as long as we think it’s necessary, and nobody will stop us.’”

Putin also addressed the rumors about his health, based on a combination of how puffy, shaky, and generally unhealthy he looks and wishful thinking. “I’ve heard the rumors that people in the West think I’m sick or dying,” he said. “Those rumors are not true. I feel strong and healthy.” And then, Mr. Smukler said, Putin quoted Mark Twain, saying, “The rumors of my death have been greatly exaggerated.” (In fact, scholars tell us, this marvelous quote itself is exaggerated; the original was a bit flatter. Samuel Clemens actually said “The report of my death was an exaggeration.” Sometimes exaggeration is a good thing.)

How did Putin know about a Mark Twain quote? “Mark Twain was part of our school program,” Mr. Smukler, who moved from Moscow to the United States when he was 30, said. “In the seventh grade, we started American and English literature, and Mark Twain was part of that. So everybody knew that quote.”

But back at the economic forum in St. Petersburg, it had been assumed that Mr. Tokayev, Kazakhstan’s president and therefore in a sense Putin’s vassal, was there to support his liege. “But in his speech, Tokayev said that ‘we are not recognizing quasi states like Donetsk and Luhansk. We are not planning to recognize them. We are denying their right to be independent because if every small quasi area in the world suddenly will announce its independence from its main state, the world probably will have 500 to 600 small states, so it will be chaos.’

“‘So we are very much against such a practice and precedent. We are not planning on recognizing them.’” (By comparison, Kazakhstan is the world’s ninth largest country; it’s sparsely populated but still has about 19 million people.)

“And if anybody thinks that Kazakhstan will help Russian business to avoid sanctions, that is a big mistake,” Mr. Smukler quoted Mr. Tokayev as saying. “We are not going to participate in any economic activities that will violate international or Western sanctions against the Russian economy.” By that, Mr. Smukler explained, Mr. Tokayev meant that he would not allow Russian companies to open bank accounts in Kazakhstan, evading the sanctions against Russian banks. Now, Russian banks can work only internally; Kazakhstan will not help change that. Mr. Smukler said Mr. Tokayev’s message was: “‘Don’t try to do it. We won’t let you.’

“Tokayev also said that ‘we are absolutely against the war in Ukraine.’ He didn’t say he supported Russia or Ukraine. He clearly said that Kazakhstan was not going to recognize the independence of Donetsk and Luhansk, and it was not going to support breaking Ukraine into pieces. He was not planning on giving any options to Russian companies, just because of the relationship between Russia and Kazakhstan.

Russian President Vladimir Putin and President Kassym-Jomart Tokayev of Kazahkstan are at the Valdai Discussion Club in Sochi, Russia, in 2019. (Presidential Press and Information Office)

“That speech was like a nuclear bomb,” Mr. Smukler continued. “It was incredible. Tokayev demonstrated such strong independence from Russia, and I don’t think Putin was happy to hear it. It was a crack in the relationship, and Tokayev was the only world leader who came to the summit.

“So the isolation of Russia continues.”

Mr. Xi’s Zoom speech was “was a big sign of support, but he was mostly neutral,” Mr. Smukler reported. “He didn’t talk about Ukraine or the special operation. It was very neutral and bland, and talking like nothing happened.

“You got the message that China will not pay attention to Western sanctions, so the message was the opposite of Tokayev’s.

“China is supporting Russia, and China is the beneficiary of the situation. Putin receives almost $50 billion dollars a month selling his oil to China” — oil that he sells at a huge discount, and oil that no one else will buy right now.

And soon China will make the airplanes and heavy machinery that Russia needs and will sell them there. “China penetrates into every pore of the Russian economy,” Mr. Smukler said. “China slowly will replace everything — computers, cellphones, cars. Everything. China will enjoy that situation very much.”

Putin won’t enjoy it so much, although he will need it. “I don’t know how he will become emperor of all Russia, or even survive as an independent superpower,” Mr. Smukler said. “China basically is taking over Russia, with help from the Western countries. So far, the sanctions against Russia are not working effectively. It’s true that the Russian economy is suffering. It’s true that the people are suffering. They feel it. I remember that President Biden said that we want the people to understand what the regime is doing, and that is has to be replaced.

“So far, it hasn’t worked. The regime has become stronger, the people suffer, and we don’t see the result that the West wants.

“I wonder if there is any time in world history when sanctions really have worked or have created a situation that ended with the regime changed,” Mr. Smukler said. This is not rhetorical but a real question. “Who can give me an example of sanctions being implemented where the punishment worked?

“So far, Putin’s popularity ratings are going through the roof. Most experts say that the population will really feel the sanctions about six to eight months after they’ve been implemented, and it’s been four months. So we have to wait at least three to four months to see what will happen, but today I don’t see any huge effects from the sanctions inside Russia. Yes, lots of people lost their jobs, and companies, particularly western companies, lost billions of dollars withdrawing from Russia, abandoning their factories, but I don’t see the regime becoming weaker after the sanctions were implemented.

“But we do see that Europe is suffering today, because of the lack of oil and gas, and propane is skyrocketing in price, and African countries in particular will suffer because of the grain deficit.” (That deficit is the result of Russia’s keeping Ukraine’s massive grain crops from being exported to the markets that wait for it.)

Then Mr. Smukler switched from the misery that awaits millions of people because Vladimir Putin wanted some glory that seemed to be within his reach but wasn’t to the plight of a beloved old friend.

“The chief rabbi of Moscow, Pinchas Goldschmidt, is my dear friend, and he was my rabbi for many years.”

At the end of May, Rabbi Goldschmidt and his wife left Russia to fund-raise in Western Europe, as is their practice, and to visit his father in Israel. If they have any plans to return to Russia, they have not made them public, even though Rabbi Goldschmidt was reelected to his role at the Choral Synagogue right around that time. Rabbi Goldschmidt has been under a great deal of pressure from the government to support the war but has not done so.

(Because everything in the Jewish world connects, he is also the father of Benjamin Goldschmidt, the young rabbi who worked at Manhattan’s Park East Synagogue until its venerable leaders, Rabbi Arthur Schneier, suddenly fired him. Since then, he’s started his own shul on the Upper East Side. His wife, the journalist Avital Chizhik-Goldschmidt, has been tweeting news of her in-laws.)

By the time Rabbi Goldschmidt established himself in Russia, Alex Smukler and his family were long gone, but his business connections brought Mr. Smukler back to Russia for months at a time. “I attended his shul, and knew him for many years,” Mr. Smukler said.

“He is an outstanding person, and I want to pay tribute to him.

“He was a young man when he first came to Russia, around the time of perestroika; Gorbachev allowed him to come. He was the first Western-trained rabbi allowed in. He did not speak Russian then; now, he speaks brilliant Russian. He is such a brilliant person, with such a heart.

“He first was the second rabbi at the Choral Synagogue, and then he became the chief rabbi there, and then the chief rabbi of Moscow. He is such a well-respected Jewish leader.

“Whenever I had a difficult time with my business, with my personal life, with my boys, I always had him to go to for advice. I would attend Shabbat services and many holidays at his synagogue.

“He is a classic old-style rabbi. Compared to my friends from Chabad, who I also know very well, there is a difference. Rabbi Goldschmidt is not Chabad. He is Orthodox.

“He was brave; he left the synagogue and appealed to his followers. He told them that he cannot stay in Russia and endorse what Putin’s regime is doing, so he left.

“Compare that to other Jewish leaders and rabbis, who continue to stay in Russia. We never hear any statements from them condemning Putin’s invasion of Ukraine.

“Berel Lazar” — the Chabad chief rabbi of Russia — “made a statement condemning the war, but it was neutral. He called for peace, but never openly condemned either Putin’s regime or the brutal invasion of Ukraine.

According to the French newspaper Le Figaro, Rabbi Goldschmidt also talked to rabbis in neighboring Moldova in February, soon before the war started, to warn them that refugees soon would find their way there. His position in Russia was not helped by not being Chabad; internal politics in in the Russian Jewish community are fierce, and Chabad rabbis have established relationships with Putin over the years.

“It is important that we talk about Rabbi Goldschmidt,” Mr. Smukler said. “It is important to know that there are more and more people brave enough to stand up against Putin’s regime. The president of Kazakhstan is one of those people, and so is Rabbi Goldschmidt.”

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