Saturday, August 17, 2019

Moscow Mitch's Russian business deal sounds very familiar to this Wisconsinite

I happened to tune into Rachel Maddow on Wednesday night, and caught this amazing opening segment, which explains why the Senate Majority Leader is rightfully known as "Mocow Mitch". But as she spoke about the deal that Sen. McConnell and a Russian aluminum manufacturer named Rusal that is owned by Kremlin-linked oligarch Oleg Deripaska, it was giving me some deja vu back in Wisconsin.

Here's the clip, and I'll be back to discuss this afterwards. The Deripaska stuff starts around 10:30 if you want to jump to it.

Maddow quoted heavily from this Time magazine article by Simon Schuster and Vera Bergengruen, which connects the dots between the recent removal of sanctions against Russian oligarch Oleg Deripaska and Deripaska following that up by announcing that Rusal would locate a $1.7 billion plant in Ashland, Kentucky.
But to some observers, the story of how a Kremlin-linked aluminum giant offered an economic lifeline to Appalachia is an object lesson of the exact opposite. Critics of the deal, both Democrat and Republican, say it gives Moscow political influence that could undermine national security. Pointing to Moscow’s use of economic leverage to sway European politics, they warn the deal is a stalking horse for a new kind of Russian meddling in America, one that exploits the U.S. free-market system instead of its elections. “That’s just what the Russians do,” says veteran diplomat Daniel Fried, who shaped U.S. policy on Eastern Europe at the State Department from the late 1980s until 2017. “They insert themselves into a foreign economy and then start to influence its politics from the inside.”

What worries national-security experts is not that Rusal, Braidy or Deripaska broke any laws in the deal. It’s that they didn’t. A TIME investigation found that Rusal used a broad array of political and economic tools to fight the sanctions, establishing a foothold in U.S. politics in the process. “You cannot go against them in a policy decision, even though it’s in our national interest, when they have infiltrated you economically,” says Heather Conley, who served as a Deputy Assistant Secretary of State under President George W. Bush. “They use our laws, our rules, our banks, our lawyers, our lobbyists—it’s a strategy from within.”
Basically, it’s buying off people with jobs and (questionable) promises so that the foreign country can seem like they're the good guys. Then, it becomes a lot harder to get tougher on them when they do other things that aren’t so cool.

Some in Kentucky are rightfully skeptical of this deal with Deripaska’s company.
But not everyone in Kentucky was excited about the Russians’ arrival. After Donets’ visit, a red billboard funded by a liberal group was erected on a busy stretch of I-75: “Russian mob money . . . Really, Mitch?” “The only reason Oleg is here is because Mitch McConnell opened the gate,” says Representative Kelly Flood, a Democrat from Lexington. “We are now all aligned with this criminal.” The deal created unease among some Republicans too. “I would not have taken the Russian money,” James Comer, the GOP Congressman representing Kentucky’s First District, said on the day the partnership was announced.
However, the unpopular governor of the state has to face the voters of Kentucky in 3 months, and not surprisingly, he is doubling down on his support of the Rusal project, to show that "help is on the way."
Yet even critics of the deal were leery of the fallout from killing it. In 2017, Governor Bevin had cut an unusual agreement in which the state directly invested $15 million in the new aluminum mill. At least 750 investors, most from Kentucky, put in money as part of the “crowdfunding” portion of Braidy’s common stock offering, Bouchard said. In effect, Kentucky taxpayers were partners in the project. “To pull out as a state now is to pull out on the people of Ashland,” says Flood….

On rare occasions, Russian oligarchs have even described how this strategy works. “What is a factory in a one-factory town? It’s what all life revolves around,” the billionaire Dmitry Firtash, a longtime ally of the Kremlin in Ukraine, told TIME in a 2017 interview. “We don’t just pay wages. We provide the social safety net. So people believe us.” When he and his factories put their support behind a political cause or candidate, “that influences people,” Firtash explained. “That’s what ensures electoral support.”
Sound familiar? It should.

As Maddow was continuing with her opening piece, I found myself saying “THIS IS FOXCONN” several times. Think about it – Scott Walker, Donald Trump and Paul Ryan were desperate to show job growth through increased manufacturing in Summer 2017, and wanted it to happen in a relatively depressed part of the state.

At the same time, Foxconn saw a way to get good PR for themselves and perhaps get an exception to any tariffs Trump might put on products from China or Taiwan. So why not promise a major factory that adds a large number of jobs, and put it in a state Trump needs to hold onto to stay in office. And time the announcement so it comes one year before the GOP governor faces re-election, and put it in the district of the Speakers of the US House and the Wisconsin Assembly. Win-win for everyone!

What a cynical, disgusting scam. And the same thing is happening in Kentucky with this proposed plant from Rusal. Mitch McConnell is a hated incumbent facing re-election in 2020, and Deripaska and other Russian business interests see an obvious opening. “Hey Mitch, if you get rid of our sanctions and stop Congress from looking into how we interfered in the 2016 election, we'll help you buy off a number of votes by bringing jobs to a dying town in Eastern Kentucky.”

Maddow connects the dots with this portion of her opening monologue.
The short story here about Mitch McConnell is that he, more than anybody else in Washington, has blocked U.S. efforts to constrain or respond to Russia`s recent attacks. That`s why they`re calling him Moscow Mitch now, right?

But in this particular instance, his state, an economically disadvantaged part of his state, got a $200 million investment from a Kremlin-connected oligarch immediately after McConnell personally stepped in to make sure sanctions on that oligarch were dropped, despite his role in what happened to our election in 2016 and despite bipartisan support even from his own party for their sanctions.
And if Congress tries to crack down on Russia before the 2020 elections, Maddow points out that Deripaska and Rusal have a new card to play. They can threaten Moscow Mitch with the jobs that they, as the Great Benefactor, have gifted his home state.
But now, Oleg Deripaska`s business activities, the health of his business empire, that`s part and parcel of the hard-scrabble economy in one of Kentucky`s neediest counties. I mean, this is a plant that`s over a billion dollars. It`s one of the biggest aluminum plants in the U.S. ever. It`s 40 percent owned by the company of this Kremlin-connected oligarch.

You`re not going to be able to sanction him no matter what he does to our 2020 election or whatever else he does at all. It would strangle Kentucky in the process. There would be hundred, if not thousands of American jobs riding on anything you did to that Russian guy`s company or, frankly, anything you did to bother him.

He now holds all of those American jobs in his hand. The U.S. government does anything to bother him, he can take them away at will. So, you can`t do anything to his company, not without him exerting that leverage over Kentucky in response.
And wouldn’t it be a bad thing for this plant to fall through before Mitch and Trump face the voters in November 2020?

The Time magazine article also mentioned that Rusal’s holding company had sent a letter to eight governors in April saying they could do for them what they might do for Kentucky. And the first governor addressed in that PDF of the letters?
Dear Governor Evers,

I am writing to you as Executive Chairman of En+ Group PLC, which is listed on the London Stock Exchange, We are the world's largest producer of aluminum outside of China and the largest private sector owner and operator of hydropower installations globally. We generate more than 15 gigawatts of hydroelectricity from which our metals subsidiary, Rusal, creates high quality, low-carbon aluminum. In total, we employ more than 100,000 people through our operations in 13 countries on five continents—from our state of the art smelters in Siberia, to our bauxite mines in Jamaica and West Africa to Europe's largest alumina plant in Ireland.

As part of our international growth strategy, we see significant opportunities across the whole aluminum industry value chain in North America. As you can see from the attached news articles, just this week we announced plans to become a cornerstone investor and strategic partner in the largest new aluminum rolling plant to be built in the US. in nearly forty years. Located in Kentucky, this $1.6 billion project is a first of its kind and will bring hundreds of new high-quality manufacturing jobs to the region.

This investment is just the beginning of our long-term ambitions. Given the growing global demand for high quality, low carbon aluminum and the opportunity for growth |n the U.S., we are eager to evaluate other opportunities around the country and in your state in particular. If appropriate, I would be delighted to explore these issues in more detail with you and your staff.
After the debacle of Foxconn, I would hope Evers told Rusal “HELL NO”. We already have one compromising boondoogle with a foreign company to deal with, and don’t need more.

In addition to the similarities to the empty promises and politically-motivated reasoning with Foxconn, Deripaska has another Wisconsin connection, and it comes from the Mueller report.
Trump campaign chairman Paul Manafort briefed Konstantin Kilimnik, a man with suspected ties to Russian intelligence services, about key battleground states in the 2016 presidential election, including Michigan, Wisconsin, Pennsylvania, and Minnesota, according to special counsel Robert Mueller's report.

The 448-page report, released on Thursday, laid out the findings of the special counsel's two-year investigation into whether members of the Trump campaign conspired with the Russian government during the 2016 presidential race. A key subject of interest in the investigation was Manafort's work for Ukrainian and Russian oligarchs and his interactions with these figures while he was Trump's campaign chairman.

The report noted that Manafort instructed his longtime colleague Rick Gates to provide Kilimnik with internal Trump campaign polling data and briefings on the campaign's strategies. For years, Manafort and Kilimnik worked together closely on political campaigns in Ukraine. Manafort even nicknamed Kilimnik his "Russian brain." The FBI has determined that Kilimnik, who was once a Russian military translator, has links to Russian intelligence services.

The Mueller report noted that Manafort expected Kilimnik to share the Trump campaign information with individuals in Ukraine and with Oleg Deripaska, a Russian aluminum magnate with close ties to Russian President Vladimir Putin.
Put this together, and any wonder why Homeland Security Chair Ron Johnson (who benefitted from Russian propaganda efforts in his election in 2016) doesn’t seem too keen on looking at whether this deal with Rusal in Kentucky has potential issues on national security? Me neither.

You can’t trust any of these oligarchs or the Republican hacks who are glad to do their bidding. They are rotten with bad faith to the core.

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