October 18, 2017: The government declared, quietly but in several ways, that its effort to revive the military has reached the point where military spending can be reduced and more spent on reviving the economy. The government points out that because of additional military spending since 2011 the NATO threat has been blocked and that, not another Cold War, was the real objective of all the military spending and accusations that NATO was scheming to surround and destroy Russia.

Back in 2011 there was a major shakeup in the government as the plan to give military spending priority was implemented. Many senior officials, including the Minister of Finance disagreed with this and pointed out that this was what the communists constantly did during their 70 year rule and was the main reason Russia fell further behind the rest of Europe (and the world) in economic development. Most of those dissenting officials were removed from their jobs but, in an often unnoted move, not persecuted or punished and some were encouraged to continue advising the government but doing it quietly. Then came the unexpected collapse of oil prices in 2013 and economic sanctions because of the aggression against Ukraine. The government was forced to cut back on the military revival. Not just because there was less money but because the sanctions made existing economic problems (corruption and revival of the police state) worse. That triggered a massive flight of skilled Russians and non-Russians (who had come to participate in the economic revival that was not working as expected) as well as Russian and foreign cash that was seeking investment opportunities elsewhere. That crippled many defense related industries which now could not obtain qualified technical or management personnel. It was also more difficult to get cash to expand or upgrade manufacturing facilities. All this led to a growing number of missed deadlines and embarrassing public failures of new warships, combat aircraft and armored vehicles. In the end this forced the government to make the quiet declaration of military victory and returning to economic revival.

Despite all the positive spin the Russian economy is still in decline. Business bankruptcies continue to rise, new business creation declines while cash and key people continue to flee. The government says it is ready to deal with even lower (about $40) oil prices but what people see around them says otherwise. Unemployment rates rise and living standards continue to slide. The population continues to shrink, not just because of more migration but because of fewer births. Government controlled media propaganda to the contrary, the people are not feeling optimistic about Russia. Anyone who could do the math would agree. The situation would get visibly worse in the 2020s. Russia needs a plan to deal with that and none appears to be in the works.

The reality is that the NATO threat was a myth but the growing economic problems are not. This is made clear via opinion polls and international economic surveys. The corruption rankings put Russia among the most corrupt nations and those are the ones that have the worst economic and military performance. The most recent corruption surveys show Russia as more corrupt than China and Russia has the same corruption rankings as Ukraine and most of the other nations that used to be part of the Soviet Union. Do you see a pattern here? A growing number of Russians (and others who used to be ruled by Russians) certainly do. East European nations have much less corruption and much better economies. Russians easily see this in neighbors like Poland, Finland and the Baltic States.

A more recent international survey, of Global Competitiveness, ranked 137 countries on how well the local conditions (low corruption, economic freedom and opportunity and robust economy) facilitated the ability of that nation to compete in global markets. The top five were Switzerland, the United States, Singapore, Netherlands and Germany. Russia was 38, Iran 69, Pakistan 115 and so on to the bottom five (Mauritania, Liberia, Chad, Mozambique and Yemen). Despite all that Russian political opportunists have found it easier (or more expedient) to exploit the ancient Russian fondness for considering themselves the cure for major threats to the neighborhood. Russia had dealt with Mongols, Napoleon, Nazis and is still trying to do something with NATO.

Syria

The government made it clear that Russian forces in Syria will not be reduced anytime soon because with the rebels defeated Russia has two military bases in Syria to develop and agreements to continue training and rebuilding the Syrian military. Opinion polls in Russia show 54 percent of Russians approve of the Russian efforts in Syria, but 34 percent oppose the Syrian operation and that percentage is increasing. While the government has kept Russian casualties down it has not demonstrated how the expensive operations in Syria are helping the average Russian.

In the past week senior Russian military officials visited Israel and met with their counterparts. Russian migrants comprise one of the largest national groups in Israel and this was highlighted when a Russian general, in uniform, publically honored over a dozen Israelis from Russia who had served in the Red Army during World War II. Such service is a big deal in Russia where the World War II victory over Germany, and the huge losses (about 18 percent of the Soviet population died during the war) are regarded as a historic achievement. Russia and Israel have often worked together, even during the communist period (that ended in 1991 when the Soviet Union did). Russia tries to maintain its alliance with Turkey and Iran while also remaining on good terms with Israel and the Arab oil states in the region. During this visit Israel repeated that it could not and would not allow Iran to establish itself militarily in Syria. The visiting Russians were non-committal as usual but the fact is that Russia and Israel have a longer and better relationship than the one Russia has with its new allies (and traditional enemies) Iran and Turkey. Israel continues to fire on Syrian and Iranian forces that act aggressively towards Israeli forces. There were several incidents of that so far this month and Russia does not denounce Israel. But Russia does not openly back Israeli proposals of how to deal with Iranian forces in Syria.

Over the last few months Russia, Iran, Turkey and the Assads have turned the “de-escalation” (and ceasefire) zones into slaughterhouses by resuming attacks on pro-rebel civilians and any rebels they can find. That played a role in the collapse of any coordinated rebel resistance to Assad efforts to regain control over the entire country. The most effective weapon used against the rebels is airpower, which is mainly supplied by the Americans and Russia.

The U.S. and Russia have a hot-line they have been using, during October, some 20 times a day to coordinate their air and ground operations so they do not fire on each other. Russia has similar arrangements with Turkey (that is not needed much) and Israel (more often than Turkey) to avoid unwanted clashes. Most of the airstrikes in Syria are by the American led coalition. This is followed by Russian and Assad aircraft (who work closely together) and finally the Israelis and Turks.

ISIL (Islamic State in Iraq and the Levant) is rapidly losing it personnel and territory because of constant attacks by just about everyone (Turks, Kurds, Assad and his Iranian and Russian allies as well as the Americans and sundry other minor players). As ISIL is being put down everyone is thinking about the next phase of the civil war. The winners want to get rewarded for their service. The Syrian Kurds want autonomy in the northeast (mainly Hasakah province) and protection from Turkish efforts to keep the Syrian Kurds away from the Turkish border. That’s going to be a problem. There are more problems in the north, such as the FSA (Free Syrian Army). This group was a major player early on because it was largely secular and popular with Western nations. But most Syrian rebels preferred more radical groups like al Qaeda and eventually ISIL. FSA continued to exist and eventually found a patron in Turkey, which apparently plans to turn over control of the Syrian side of the border to FSA, if the Assads and Syrian Kurds can be taken care of.

Then there is the Iranian situation. Iran wants to turn Syrian into a “protectorate” where Iran will establish military bases and organize a Shia militia similar to Hezbollah in Lebanon. No one besides Iran is particularly fond of this plan, even current Iranian allies Turkey and Russia. The Iraq government, despite, being controlled by Iraqi Shia Arabs, does not want to submit to any form of Iranian control and Israel has made it clear it will fight rather than allow Iran to set up shop in Syria.

Iran and Russia have both signed deals with the Assads to establish military (mainly naval) bases in Syria. Iran and Russia are doing this for different reasons. Russia has always wanted a secure Mediterranean naval base. Iran wants bases in Syria because Iran has openly called for the destruction of Israel since the 1980s and is now seeking leadership of the Islamic world and control of Mecca and Medina.

It is possible for Russia and Israel to continue working together, as they have done since Israel was created in the late 1940s. Even during the communist period (especially from 1948 to 1991) Russia often worked closely with Israel while also courting Arab states that wanted Israel to disappear. Russia continues this policy of maintaining multiple alliance with Turkey and Iran while also remaining on good terms with Israel and the Arab oil states in the region. Give the Russians credit, they are getting away with it. But it is becoming increasingly difficult.

Israel remains openly hostile to a permanent Iranian presence in Syria. Turkey quietly agrees and Russia is seeking opportunities for itself but seems to dislike the Iranian long range plan. Israel is quite blunt about describing Iran as replacing ISIL as the new threat to just about everyone. Russia sometimes supports that openly and Israel keeps trying to improve relations with the unstable Turkish Islamic government. Meanwhile Iran keeps moving in.

Russia has long had problems with Israel over where Iranian forces can go in Syria. Russia is enforcing the “no-fly” aspect of the “de-escalation” and ceasefire zones that are being set up in parts of Syria that rebels have lost control of. This includes parts of the Israeli border (the Golan Heights) and Hezbollah leaders can’t help themselves and boast to the media that Hezbollah has thousands of troops on the Golan Heights border and more are moving in daily. This issue becomes a news item every few weeks because that’s how often Russian and Israeli officials meet to discuss mutual concerns about what is going on in Syria and to ensure that Russian and Israeli forces avoid firing on each other. Israeli air attacks still take place in these ceasefire zones but less frequently than outside these zones. The main problem is that Israel detects Hezbollah and Iranian forces using the “ceasefire” zones, has compiled evidence and is pressuring Russia to stop supporting these ceasefire zones. Israel has said it will attack any Iranian forces (especially Hezbollah) that get within 40-80 kilometers of the Israeli border. Currently Russia says it will only agree to five kilometers and implies that Russian warplanes and air defense systems will side with Iran if there is a problem. That has not been the case so far as long as Israel restricts its airstrikes to some limited list of items Israel and Russia have informally agreed on. This is not working for Israel because five kilometers is close enough for Hezbollah and other Iran-backed militias to fire mortar shells and portable rockets into Israel.

Russia and the Syrian government realize that Iran intends to control a post-war Syria and attempt to turn it into a Shia majority nation (via forced conversions and expulsions of stubborn Sunnis). That would make the Assads totally dependent on and subservient to Iran, something that most Assad supporters are not in favor of. But defying Iran does not appear to be a practical option because the most effective troops the Assads have are the 20,000 or so Iranian supplied Shia mercenaries. Israel is also aware, as are Russians, Turks, the Assads and nearly all Syrians, that Iranian efforts to take control of Syria are unwelcome. Since Iran is currently run by a religious dictatorship any opposition in Syria must be overcome because Iran is on a Mission From God and not to be interfered with. The Iranians, as far as everyone but Iran is concerned, are simply replacing one brand of Islamic fanaticism with another as the ISIL presence is extinguished in Syria.

Ukraine

The latest ceasefire agreement went into effect in late August and so far local and foreign ceasefire monitors have counted about a thousand violations where rebel or Russian forces fired on Ukrainian troops. That’s about 15-20 incidents a day so far. All that firing (or machine-guns, mortars, rocket launchers and artillery) has caused about fifty casualties so far, including at least seven dead. Russia is stalemated in Ukraine but is apparently going to become more active once the Islamic terrorist threat in Syria is completely crushed.

Venezuela

Negotiations for Venezuela to buy Russian submarines have resumed as of early October when the Venezuelan president visited Russia to make deals. Few details were released, except for the revival of the 2005 effort to buy four subs. Those negotiations fell apart but have been revived to use a billion dollar loan from Russia to buy two Kilo class subs. That was not the main item on the agenda; keeping a Russia-friendly government alive in Venezuela was. President Maduro, seeking to become president-for-life of Venezuela relies a lot on trading access to his mismanaged oil wealth with China and Russia in return for whatever it takes to keep Maduro in power. Russia and China have already loaned Venezuela over $50 billion and have obtained claims on Venezuelan oil as collateral. But that is useless if Maduro is overthrown so Russia, which long subsidized nearby Cuba, has a unique opportunity in oil-rich Venezuela. Cuba had few natural resources but Venezuela is another matter.

China and Russia hold most of the $70 billion in foreign debt Venezuela has. Russia has about 30 percent of that and continues to make loans while China is standing aside and allowing Russia to supervise the rescue effort. Iran and Cuba also provide special skills and are also negotiating their fee. That’s how a dictatorship works. You steal what you can and pay what you must to keep it. Since 2013 Venezuelan GDP has dropped 35 percent and per-capita GDP is down 40 percent. Things will get worse before they get better even with a police state. That’s because the new government must put priority on keeping the government employees, especially the ones with guns, satisfied and content to follow orders. You don’t need a Cuban advisor to point that out but the Cubans provide practical advice on how to get it done as quickly as possible. Russia and China are willing to provide the needed equipment on credit.

October 13, 2017: The Americans announced that it will not continue to support the 2015 treaty that lifted sanctions on Iran because Iran is not keeping its end of the deal. The U.S. has some political support in the other countries (China, France, Germany, Russia and Britain) that signed the deal but China and Russia still back the treaty and all five of those countries have already sold Iran billions of dollars’ worth of goods and services and are reluctant to give that up just because Iran is cheating a bit. Russia was particularly critical of the United States for not being a team player and trying to wreck an international agreement.

October 12, 2017: In the Philippines government officials revealed that Russia had sent military aid that included 5,000 AK-47 type assault rifles and 20 military trucks.

October 11, 2017: Russian and Iranian companies agreed to develop software to connect Iranian and Russian credit card and electronic banking systems. China is also working on developing an alternative to the “Western” financial system that has been dominant for several centuries.

October 10, 2017: Russian foreign aid declined in 2016 (from $1.16 billion to $1.o2 billion). These are the only two years since the Soviet Union dissolved in 1991 that foreign aid exceeded a billion dollars. During the 1990s most “foreign aid” consisted of forgiving Cold War era debts, which, usually, were unpayable anyway. As of 2016 the amount of old debts to forgive has declined to the point where there is little left. Since 2014 (sanctions and low oil prices) Russia has had to cut government spending more and more each year and nothing, not even defense or foreign aid, is spared.

October 9, 2017: Russia’s only aircraft carrier, the Admiral Kuznetzov, is having its much-needed refurbishment curtailed, again. Kuznetzov was due for nearly $900 million in upgrades and repairs. That budget has now been cut in half. This is bad news. In 2016 when Kuznetzov last visited the Mediterranean foreign military pilots flying close by could not help but notice that there was a lot of rust on the deck of the carrier and the vessel looked unwell. This was not a good sign. The only other ship of the Kuznetzov class was purchased by the Chinese in 1998 and completely refurbished by 2012 to become the Chinese Liaoning. It is now in service and looks a lot better than the Kuznetzov, which has had some updates since the 1990s but a lot of this work is suspect. Back in 2012 a military procurement official was prosecuted for substituting cheaper, substandard parts for new ones meant for the Kuznetzov. The corrupt official used forged documents to get away with this but members of the crew noticed the substandard parts and reported it. The Kuznetsov has been sent back to the shipyard several times since 2005 to fix problems and update equipment. Much was wrong with the ship, due to poor design, sloppy workmanship, or corruption. It’s gotten so bad that lackadaisical sailors are threatened with being sent to serve on the Kuznetsov as a way of motivating them. These cruises south were mainly for publicity purposes and without an extensive refurbishment Kuznetsov cannot go to sea regularly. The reduced budget for Kuznetsov will concentrate on keeping the carrier operational but not much more. Currently the ship has serious problems with its engines and many other mechanical and electrical systems. These must be fixed for the ship to remain mobile and habitable. This is important not for military purposes but because Kuznetsov is the flagship of the fleet and a symbol of Russian naval power. So enough must be done to at least keep up appearances.

October 8, 2017: Russia enacted a new law that allows foreigners serving with the Russian military (active duty or as military contractors) to serve overseas. It is believed that this has already been happening and the new law simply confirms that. Not that many foreigners serve in the Russian military, despite hopes that more would join. To get in the foreigner must be a legal migrant, speak adequate Russian and pass a background check.

October 7, 2017: Ukrainian officials believe a Russian military contractor (called “Wagner”) has, on orders from Russia, restored discipline in rebels controlled areas of Donbas by kidnapping or assassinating rebel leaders who were not following orders from Russia. The Wagner firm is a major Russian military contractor with thousands of personnel in Ukraine and Syria. What little is known about Wagner is collected from Internet posts (usually in social media) about the death of Wagner employees in Ukraine or Syria. There is so much data like that freely available that it is possible to get a good idea about the size and activities of Warner and other military contractors Russia uses.

October 6, 2017: In eastern Syria (Deir Ezzor province) an American airstrike hit a convoy of Syrian government forces (and Iran backed Shia mercenaries) who had moved too close to the U.S. controlled Tanf border crossing (into Iraq). This airstrike killed seven and wounded sixteen and occurred two days after these forces came closer than 55 kilometers to Tanf. The Americans had an arrangement with Russia that if anyone came closer than 55 kilometers the U.S. would first call the Russians (on a special hotline) to warn them that the Americans would attack the intruders. Apparently the Russians could not get the Iran-backed forces to retreat and the U.S. struck. Airstrikes like this have occurred since late May despite repeated warning to the Russians to persuade their allies (the Assads and Iran) to remove forces from the area. The first airstrike (May 20) was carried out because a convoy had entered a “de-confliction” zone the U.S. and Russia had agreed would be controlled by U.S. backed rebels who operate out of training bases in Jordan and the Tanf base near the Iraq border. The Iranian mercenaries (Hezbollah and Shia from other nations) militia did not try to advance again for a while. In response to the American air strike the Russians accused the U.S. of allowing ISIL and other Islamic terrorists to take shelter in the Tanf “no-go” zone and from there make attacks outside that zone. No evidence of this has been presented but the Russians have to say something that won’t offend their Iranian ally.

October 5, 2017: Saudi Arabian and Russian officials met and discussed Saudi interest in buying Russian military equipment. The discussions resulted in the Saudis offering to spend $2 billion to obtain four batteries of S-400 air defense systems. Turkey recently agreed to a similar purchase. The Saudis already have an updated American Patriot air defense system which has been very effective dealing with dozens of ballistic missiles Yemeni rebels have fired at Saudi Arabia. The main purpose of buying S-400s was to gain support from Russia and counter the recent Iranian acquisition of older S-300 systems. The Saudis have already made several large arms purchases from Russia, including setting up factories in Saudi Arabia to produce Russian weapons under license.

October 4, 2017: Two Russian subs off the Syrian coast fired ten Kalibr cruise missiles at targets in eastern Syria. This is a frequent occurrence and the best kind of advertising for Russian arms exports.

October 3, 2017: In northwest Syria (Idlib province, west of Aleppo and bordering Turkey) a Russian airstrike badly wounded Abu Mohammad al Jolani, a senior leader of a rebel faction allied with al Qaeda. Jolani was meeting with his subordinates and the air strike killed or injured twelve of them as well as about fifty bodyguards. Jolani apparently had an arm blown off and was in critical condition. Jolani was one of the founders and senior leaders of al Nusra. This group evolved into a larger coalition (Tahir al Sham) which is now leading the rebel effort to hold onto some of Idlib province while trying to keep the rebels from fighting each other. With Jolani out of action (temporarily or permanently) the rebel resistance becomes much weaker. Already some rebel groups have accused Tahir al Sham of making a deal to give most of Idlib province to Turkey and the Assads in return for certain favors. Such deals are being offered by the government and some rebel factions have been willing to talk.

Elsewhere in central Syria ISIL claims it executed one of the two Russian soldiers it captured in September. The problem is that Russians say the two men are not exactly soldiers. One of them has been identified as Grigory Tsurkanov. He is an active member of a very pro-Russian government Cossack military veterans group. Apparently the two captives belong to one of the several military contractor firms Russia employs to provide experienced military personnel in Syria to supplement active duty Russian troops. It is an open secret that the 38 Russian military personnel killed in Syria since 2015 does not include contractor personnel and if contractor casualties were counted the number of Russian dead in Syria would be 50-100.

October 1, 2017: North Korea established a second link to the worldwide Internet via Russia. This high speed fiber optic line reaches the North Korean border as part of the Russian railroad (which is how Russia has long strung long distance telephone and telegraph access). This gives North Korea two high speed Internet connections with the outside world, the other one is via China. Russia is believed to be more involved with North Korean Cyber War operations than anyone will admit and this new Internet connection is part of that.

September 29, 2017: Satellite photos confirm that Russia has brought in a second S-400 air defense battery to guard bases in Syria. These SAM (surface to air missile) units are guarding Russian bases near the coast but because of the coastal mountains the radars cannot detect low flying aircraft or UAVs (like American cruise missiles) on the other side of the mountains. There appear to have been some other shortcomings with the Russian air defense systems deployed to Syria, especially the S-400. As a result some of the “S-400” equipment is actually S-300 systems modified to deal with low altitude targets. Several A-50 AWACS have been based in Syria for over a year, but Russia has only 17 of these aircraft and they are prone to maintenance and reliability problems. The A-50s can deal with low-flying anything, at least when the A-50 sensors are working. Syria has allowed the U.S. and Israel an opportunity to examine advanced Russia systems in action, noting what works, what doesn’t and often why.

September 28, 2017: Israel and Russia increased trade by 25 percent in the first six months of 2017. That is an increase of nearly $400 million and is a big deal with Russia because trade with most other Western nations is way down because of sanctions related to the Russian 2014 invasion of Ukraine.

September 27, 2017: Turkey finally signed an agreement on September 12th to purchase the Russian S-400 SAM (Surface to Air Missile) system and paid an initial deposit on the $2.5 billion deal. The contract provides Turkey with four S-400 battalions and technology transfer. Thus two battalions will be built in Russia and the other two in Turkey. This is not the first time a NATO country has bought Russian air defense systems. Greece bought two batteries of the S-300PMU1 (each battery with a radar and command center plus four launcher vehicles, each carrying four missiles) in the late 1990s and stationed them on Crete, where they remain in use. NATO and Israeli tech experts got an opportunity to examine the equipment and was apparently not impressed. More worrisome is that Turkey is on its way towards leaving NATO. That’s because the current Turkish government is pro-Islam, not pro-secular as all Turkish governments had been from the 1920s until 2000. For nearly a century democratic Turkey was a bastion of stability in the Middle East. That ended with the election of an Islamic government and the subsequent efforts by that government to make their rule permanent and decidedly undemocratic. That in itself is a problem for NATO, Israel and the Middle East in general.

September 25, 2017: In Iraq the autonomous Kurds who control much of northern Iraq went ahead and held the referendum on Kurdish independence. Over 90 percent of Kurds backed independence. Russian ally Turkey threatened to shut down the oil pipeline the Iraqi Kurds use to export oil in their territory. In addition Turkey would close the roads between Turkey and Iraq. Russia has invested $4 billion in Iraqi Kurdish territory and would lose most of that if the Iraqi Kurds find themselves cut off by Turkey and at war with the rest of Iraq. Encouraged by all of this Iraq sent troops to take back control of Kirkuk and in the last few days appear to have done just that.

September 24, 2017: In eastern Syria (Deir Ezzor province) Russian airstrikes have hit U.S. backed SDF forces again. American troops often accompany SDF troops (as advisors and to call in air strikes) and because of that the U.S. has advised the Russians to leave SDF forces alone.

September 23, 2017: Valery Asapov, a Russian general, was killed while advising Assad forces in eastern Syria (Deir Ezzor province). Before coming to Syria Asapov had commanded Russian troops on the Ukraine border (and apparently inside eastern Ukraine as well). It was later revealed the Asapov was chief of staff for all Russian forces in Syria and also deeply involved with rebuilding and running the Syrian military. Within a week Asapov was buried with full military honors in Russia.

September 19, 2017: Chinese and Russian warships began joint training exercises near the Russian Pacific Ocean port of Vladivostok. Chinese warships have been up here before (in 2013) but this time the Chinese warships moved through the Sea of Okhotsk for the first time. This is near the Kuril Islands, which Japan and Russia have a long-standing dispute over.

September 18, 2017: Russia has been accused of deliberately launching airstrikes on civilian targets in Syria. This comes after several hospitals in rebel held areas were hit. Russia contends that the rebels often base fighters, headquarters and military supplies in hospitals.