Korben International Industrial and Financial Corporation, Inc. Korotkevich Peter Leonidovich


Security bodies hold a very significant place in the management of any state, including this one. They mold the trends of the state development, its domestic and foreign policy, a concept of national security. They ensure financial, economic, military, informational, ideological and any other security, protection of individuals, sovereignty of territory. The interests of special services embrace saving of achievements of science, values of culture and architecture, property owned by the people both locally and outside the country.

It is very regretful that presently social-economic and political situation in Russia is being determined by practically finalized dissolution of foundations of economic potential of the country, its production basis, which has been created over the last 50-60 years and was a guarantor of economic, political and military security.

The main reason for the present situation is a wrongly chosen reform strategy.What are the miscalculations?

Russian financial and monetary, industrial and privatization policy has been formed with an active participation of international financial institutions and did not always correspond to national interests.

Monetary and credit emission, as well as excessive increase of refinancing rate were the reasons why cash assets, available at the market, were used for short-term speculative trading. At the same time industrial enterprises turned out to be completely cut off the credit resources. As a result output downturn exceeded 60—70 % of the level of 1991 , and the amount of defaults in payments between the enterprises accounted for over half of the state budget. Export volumes of machine-building and products with high added value went down, and Russia was ousted from the most profitable and perspective world commodity markets. The export balance of the country is composed mainly of non-renewable raw-material resources. Artificially understated Rouble rate (under the pretext of stimulating exports and replenishing revenues of the budget) brought about unwinding of inflation spiral.

This resulted in a cessation of financing of the industry and its further financial suffocation by taxation. Another consequence of the fall of the rouble rate became depreciation of the fixed assets of the Russian industry. Together with methods and aims of the first stage of privatization (one had to manage to evaluate the industrial potential of the country at a ridiculous sum of USD 1 bln!) it enabled the foreign businesses to buy at reduced prices the fixed assets of the Russian industry and to once and for all remove it from the markets of technological and science-intensive products, leaving it the place of a raw materials-producing appendage of the West.

Accordingly, financial policies, worked out with assistance and support of the State Duma and financial institutions such as IMF etc. and carried out by the Russian Ministry of Finance and the Central Bank became the main reason for the crisis situation in the country.

Mistakes made in the financial and credit field and in the course of privatization have been added with miscalculations in the export-import and industrial policy. Uncontrolled export of oil and gas as well as a lack of efficient currency and export control became the reason why foreign currency assets of Russian residents exceeded over some estimates a total of USD 180 bln. These assets were not invested into Russian industry and were not used for repayment of the external debt. Instead, they were used for providing Russia with new loans in order to increase its foreign debt. It is noteworthy that conditions for providing this essentially Russian money are carefully regulated by international financial organizations. At best they are expended for crediting of supplies of western equipment designed to upgrade fuel and energy sector to enable Russia to expand its exports of raw materials.

The policy of liberalizing import of food products to the prejudice of domestic manufacturers became the reason why supply of large industrial cities was made dependent on foreign and domestic food-importing firms, demanding for themselves ever greater preferential terms. Russian economy, being itself in a deep crisis, has to indirectly finance the budgets of the developed countries of the Western Europe and the US. It is just so when the Russian consumer receiving a minimum or no wage whatever has to pay taxes to the foreign budgets for goods manufactured by European or US workers as well as to pay for supply of goods by foreign means of transportation.

Possessing unique natural resources, Russian Federation used to earn 67% of the revenues of the all-union budget, expended for support of multi-million armed forces, ideologically friendly regimes in the entire world etc. Despite this it managed to develop its health care system, education and culture. Having thrown down these huge expenses, Russia however strange it may seem only doubled its external debt and is unable to ensure today minimally acceptable living standards for 70 % of its population. It appears that developers of reforms were guided not by national and state interests, but by the needs of international finance capital and related small business groups and officialdom.

Despite attempts of the President to smooth over the present situation, Russian economy today undergoes a system crisis. It is characterized by liberalization of prices, disintegration of a single economic system of the former USSR, foreign-economic bankruptcy of the country, dissolution of the state system of distribution of resources and finished products. A result of this – a growing discontent of the population, which begins to replace economic demands into political ones.A system of barter transactions took roots in the country, enabling to hide from taxation police a major part of profits and to receive illegally big amounts of cash.

A few communities with different conditions, motives of labour and a level of consumption appeared in the country. They are: personnel of the state manufacturers of goods in short supply, personnel of state enterprises which do not manufacture such goods and which are not able to sell their own goods through barter transactions (it is this category of people which is the biggest in number and capable to blow up the situation), pensioners, military men, who are incapable to improve their financial position in this system and are only capable to destroy it; personnel, engaged in “non-criminal” market economy; personnel, engaged in a “criminal” market economy, controlled by criminal elements, who also control bribable part of the state machinery and due to this fact are the most dangerous part of society; criminals, whose number grows very rapidly. Criminalization of society and a loss by the population of moral foundations is a most fearful trend.

A crisis of the financial and monetary system also contributed to the growth of the scale of pseudo-market and criminal in essence economy. Despite all declarations the Government has not taken sufficient steps to support the industry. Deregulated governmental mechanisms of the control of the economy contribute to the growth of speculative trends.

Amounts of currency forcibly withdrawn by the Government from enterprises make a big number of exporters enter into illegal agreements with foreign firms to hide a big portion of currency earnings. This enables to form steady personal ties between the officials and foreign firms, determined by participation in a breach of law.

Multifold reduction of funds earmarked for purchase of armaments and military equipment and subsequent closure of defense industry enterprises became a catalyst for social unrest.

Reforming and taking the economy out of crisis are accompanied with difficulties because of unstable and contradictory political situation in the Russian Federation. Absence of basic legislative and regulatory acts (on mortgage, property, land, the interior of the earth) which could stimulate demonopolization of the state property, resulted in broadening of separative trends.

One can not help mentioning another circumstance directly affecting the national security. Under the guise of reforming and at the suggestion of once very scared people and “new friends” of Russia a strike after strike is delivered on the state security service, which is least of all liable to corruption, firmly opposes foreign special services and consistently protects the interests of Russia. It is doing so despite constant reduction of financing and personnel.At the same time the leading countries tend to annually increase financing of their intelligence services. Along with industrial espionage the western countries brisk up attempts of introducing their agents into various Russian organizations. Back in 1992, CIA director, Gates used to say that «power and potential of the Soviet armed forces still in great measure determine the strategy of the US intelligence services». That same year the German leadership demanded from its special services to carry out work against Russia, which was considered to be the most important sector for the national interests of Germany. The effect of the «Islamic factor» also became stronger. Intelligence services of Iran, Iraq, Turkey and Pakistan have brisked up their work. Security services in Poland, Hungary, Czechia and the Baltic states are being fundamentally reorganized to phase out activities carried out against the West and redirect them against Russia and the CIS states.

Financial and economic terror and violence are more and more used not only against the personality, but also against society, the state and to exert pressure on the authorities.Russia and the east-European countries have become a gigantic bridgehead for the western drug trafficking business, trading in arms, money laundering and smuggling. There is a process of merging Russian and foreign criminal groups, a trend of drawing into smuggling activity of officials, responsible for the development of political, economic and cultural ties and implementation of programs of international cooperation.

Dissolution of the armed forces represents a special danger, considering absence of a clear program for the reform of the Armed Forces. A new “defense” military doctrine, proclaimed in  1989 , allowing to wage war only in its own territory, became effective for Russia and the CIS countries. However, in essence, a Russian military doctrine is inexistent. As a result of unreasoned conversion, military and industrial complex was destroyed and the technical equipment of the armed forces fell to a very low level. Already a few years after notorious “perestroika” specific share of the modern arms and military equipment in the armed forces of the former USSR accounted for only 30—37 %. However Russia failed to receive even this share, because the major part of equipment and armaments was left outside its borders, mainly in the Ukraine and Byelorussia. Over the types of armaments and military equipment Russian share looks as follows: missiles — 20  %, tanks — 19 %, armored troop carriers — 5%, anti-missile systems — 16  %. Out of the anti-aircraft defense means Russia lost 55%. The matters stand no better with equipment withdrawn from the former union republics. From Ukraine, alone, for example, it was required to move out 43000 railroad cars with ammunition. However because of lack of arsenals in Russia, lack of financing and other problems Russia failed to thriftily dispose of either these ammunition or 700000 units of armament and equipment, scheduled to be exported from former Soviet republics who declared their independence.

As regards social sphere, situation here is hopelessly bad due to the same reasons. Moreover the troops were withdrawn into empty fields while military camps continued to be built in the Ukraine. That is the limit as the saying goes. As a result of such reforming and thoughtless reductions, the Armed Forces, their personnel and therefore the national security of Russia were dealt a serious blow.

Let us go further. Means of electronic reconnaissance, quartered all along the borders of the former USSR, have been almost entirely lost for Russia. The ships are outdated. Since 1991 new ships have not been laid down and beginning from 1993  no new vessels besides nuclear powered submarines have been adopted. By 2005  the number of Russian surface ships will equal that of Algeria. To each commissioned nuclear submarine - 10 are decommissioned. And here lies another problem – a problem of utilization and nuclear safety.

In its western borders Russia does not anymore possess land-based anti-missile warning facilities. The property of the Armed Forces is in a suspended state and the right of ownership thereto has not been delegated to anyone specifically. This means that in legal terms this right is neither protected in Russia nor in the CIS states even more so. That is why this property is being stolen by anyone who feels like it.At this same time an active re-equipment of the foreign Armed Forces is being underway. The US and NATO countries do not hurry up to follow Russian example and cover their missiles and aircraft. More over after the war in the Persian Gulf two more air force armies will be deployed in the area. The US on the other hand demanded that Russia should reduce its anti-missile defense and completely destroy its land-based intercontinental multiple warhead ballistic missiles. At the same time similar US sea-based missiles in which it is superior over Russia are left out of the discussion. It is required therefore to take urgent steps to preserve at least what is left out of Russian Armed Forces. First of all one has to develop a concept of Russian national security, its military and political doctrine which should take into account dissolution of the USSR, abrogation of the Warsaw treaty and the Council of the Mutual Economic Assistance. It is also necessary to establish competent state bodies, which would regulate and coordinate military construction, defense industry and would be legally entitled to own the Russian military equipment. Urgent measures also include creation of a respective legislative and legal base etc. Otherwise no trace will be left out of the former parity between the former USSR and the US, which used to be a guarantor of peace on the planet.

Six years ago, in my article "Russia needs a new global geopolitical strategy”, published in the "Nezavisimaya gazeta”, I tried to express my opinion about the state of the military construction and to forecast the development of the international situation in the boundary of two millenniums. It appears that we will face an ever big desire of the developing countries to receive neuclear weapons and hence a threat of thermonuclear war. The forecast is finding its ever stronger confirmation and the threat is becoming ever more real. By my calculations by 2000 some 20 - 24 presently developing countries will dispose of the nuclear weapons. This means that the danger of a large-scale nuclear conflict, provoked by an irresponsible regime will increase considerably. That is why it is very important to create an integrated system of strategic defense, which would be based on strategic Russian, US and other countries’ containment forces. Only such joining of efforts will prevent aggression and will not allow to unleash a third world war.

The issues of geopolitics and nuclear safety refer to a category of the most important ones and shall not be disregarded either by military men or politicians, or by the leaderships of Russia, the CIS countries and the US for this matter! The main thing is to organize a reliable supervision of nuclear strategic complexes of all types and forms of stationing, which are the top risk objects. This is all the more important because dissolution of administrative and industrial structures involved into operation of nuclear armaments, an absence of legal regulations, technical documentation as well as experts, disposing of a big practical experience, a fast outflow of specialists and a breach of work regulations may result in an irreversible chain reaction.

Analyzing the present situation in Russia, the state of its national security, it is appropriate to recall a slogan well known in times of difficulty - "The fatherland is in danger!" This slogan used to possess a mobilizing effect.

The troubles outlined in this article are in many ways aggravated by a lack of personal responsibility on the part of governmental officials and non-execution of adopted decisions. Having a long record of work in the Government and bodies, set up by the decrees of the Russian President I had opportunity to observe non-execution of Boris Yeltsin’s instructions and decrees. I also witnessed how materials of top importance were submitted in a distorted form, I saw official forgeries and attempts to isolate or debar the head of the state from working out and adoption of reasoned decisions.
Despite all the disastrous character of the situation, a system crisis, which struck the country I look into the future with optimism. Russia disposes of big opportunities in order to carry out over the short time a structural rebuilding, to strengthen financial, industrial, defense and manpower potential and to re-occupy its place among the leading countries of the world.

There is a small thing to be done – to turn these opportunities into reality.
The business is after people who are ready, capable and know how to do this, i.e. the people who are skilled and competent specialists, loyal to its people and the country.

On behalf of the Editorial Staff.

The reader might have an interest to know more about the author of this article: Peter L. Korotkevich is, one may say, a unique personality. He is an Academician of the Russian Academy of the Natural Sciences, a statesman, a specialist in the field of theory and practice of fundamental, scientific and applied problems in organizing and control of complex and global systems. A theme of his article "A State and Security", offered to the attention of the reader was not chosen by chance. Yet in 1986 Peter L. Korotkevich with a group of scientists in order to promote development of the defense strategy and security of the country, stipulated by the decrees of the resolutions of the Central Committee and the Council of Ministers of the USSR put forward a scientifically grounded concept of land-, sea- and space-based nuclear strategic armaments capable to offer protection against striking factors of a likely enemy. In November 1991 at Peter L. Korotkevich’s proposal a Council of Experts under the Head of the Russian Government was set up to be subsequently reorganized into the Council of Experts under the Russian President. Its task was to hold all-round expert examinations of big socio-economic, scientific and technical, investment projects and offers relating to the national security, defense policy, arms programs, conversion etc. The Council was composed of big statesmen of the country, leading scientists and specialists, organizers of science and industry having big practical knowledge, experience in management and personal authority in the country and abroad. By the presidential decree Peter L. Korotkevich was appointed as one of the heads of the council. At Mr. Korotkevich’s proposals a number of resolutions were taken in the fields of economy, nuclear security of the basic and defense sectors of the industry. A number of institutions were set up such as the State Technical Commission under the Russian president, A State Committee for defense policy, defense industry and machine-building, a committee for the Ministry of Atomic Energy, specialized subdivisions in the Ministry of Security and the Ministry of the Interior to work with organized crime, economic offences, illegal drug trafficking and terrorism. He actively opposed dismissal of scientists and specialists of the Russian Armed Forces and worked to preserve teaching staff of higher educational institutions including those, which were part of the Federal Security Service. He was also instrumental in stopping privatization of Malyshevskoye emerald field, “Lenzoloto”, defense industry enterprises and plants of the basic sectors of the industry. International institutions, such as a Committee for Conventional Problems of the Russian Federation and the Russian-Eurasian Center of the Carnegy Fund for the world peace were instituted at his initiative. These organizations serve to establish links between the US and Russian politicians, business organizations, new types of partnerships.The editorial staff disposes of a unique document — a copy of a letter of the US president, George Bush, to the Russian President, Boris Yeltsin, dated March 24 1992. We can’t help citing it in its entirety.

"Dear Boris,
Thank you for your recent letter regarding creation of the national committee to promote resolution of problems, pertaining to chemical and biological weapons. Your commitment to relieving the world of these types of weapons is worthy of the highest appraisal. I also appreciate your statement of the readiness to ensure observance of Convention of Prohibition of Biological Weapons, dated 1972.

We must speed up the process of destruction of chemical weapons. The US is ready to help your country in resolving urgent issues relating to destruction of chemical weapons, including the fields, mentioned in your letter.

I agree with your proposal to establish a joint Russian-US group of experts to work out a practical program of actions to destroy chemical weapons. The US will send a group of experts to Moscow beginning of the next month to discuss Russian program of the destruction of chemical weapons. This will become a beginning of our participation in a joint group, which you offered to create. The US group will be ready to begin working without delay over problems touched upon by you to achieve their fast resolution. Working together we shall manage to safely and efficiently liquidate chemical weapons kept in our arsenals.

George Bush

Virtually, it was a beginning of personal informal relations between the Presidents of Russia and the US, which received their continuation during “the meetings without neckties” and involved subsequently the Chancellor of Germany, prime ministers of France and Japan.  As we may see, at their origins were such energetic scientists and statesmen as academician Peter Korotkevich.

He takes a principled, sometimes a tough stand in order to protect the interests of the state, standing up for strengthening of the law-enforcement system and security services, openly criticizing errors, committed in the course of economic reforms, manpower policy, irresponsibility of higher officials and petty officers, secretly sabotaging adopted decisions. Surely these qualities were not to the liking of all who were in power. Academician Korotkevich begins to feel open pressure, scheming around himself by those who actually directed the policy in Kremlin. As a protest and by reason of ungrounded accusations, brought in his respect, in December 1992 he turns to the President Boris Yeltsin with a request to dismiss him from the position of the deputy chairman of the Expert Council and to move him out of the staff of the Government.

Yet, having left governmental bodies, he doesn’t bear a grudge against anyone and remains loyal to Boris Yeltsin. He sends him letters with concrete proposals of how to strengthen national security, to improve economic and manpower policy, demonstrating readiness to render practical help. "...Your name and deeds, — as he points out in one of his letters, — must be connected with worthy, competent and professionally trained people, disposing of high moral qualities. This will enable to ever more strengthen your authority and position, as you are the president of the State with big history, rich traditions and enormous potential. On behalf of my colleagues I am ready to present to you in person efficient plans and measures which will enable to achieve positive results".What was the reaction of the addressee? The letter bears only one instruction, dated 2.05.96 - "Approve". And nothing more... In the words of Peter Leonidovich, his proposals had remained uncalled for...Yet his capabilities and a talent of a scientist for reforms have found application in another field. Together with his colleagues-enthusiasts he created Korben International Industrial & Financial Corporation and was elected its president. The corporation has worked out and received approval at a federal and republican level for its program of “Capital increase”. The aim of the program is to create a base of tangible assets, to conduct transactions in securities in the world financial and stock markets to use part of the received profit for organization of production and creation of food-processing enterprises to meet the demand of the Russian market in high quality agricultural produce and mass consumption products.Activities of Korben International are designed to strengthen financial-economic and industrial potential of Russia and enable to attract off-budget funds to implement programs of social protection of military men and their families, to create new jobs, and retrain military men into civil specialists. Considering social importance of this program, retired officers of the Fund of social guarantees to the military men and the Fund “Guarantee”, of which our magazine recounted in its previous issue, were entrusted to ensure its security.
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© Korotkevich Peter Leonidovich