December 26, 2021
Thirty years ago, on December 26, 1991, the headline of the New York Times read: “Gorbachev, Last Soviet Leader, Resigns; U.S. Recognizes Republics’ Independence.” On December 25, Soviet President Mikhail Gorbachev had resigned, marking the end of the Union of Soviet Socialist Republics, the USSR.
Former Soviet republics had begun declaring their independence in March 1990, the Warsaw Pact linking the USSR’s Eastern European satellites into a defense treaty dissolved by July 1991, and by December 1991 the movement had gathered enough power that Belarus, Russia, and Ukraine joined together in a “union treaty” as their leaders announced they were creating a new Commonwealth of Independent States. When almost all the other Soviet republics announced on December 21 that they were joining the new alliance, Gorbachev could either try to hold the USSR together by force or step down. He chose to step down, handing power to the president of the Russian Federation, Boris Yeltsin.
The dissolution of the USSR meant the end of the Cold War, and those Americans who had come to define the world as a fight between the dark forces of communism and the good forces of capitalism believed their ideology had triumphed. Now 90, Gorbachev said Friday that with the collapse of the Soviet Union, "They grew arrogant and self-confident. They declared victory in the Cold War."
While Gorbachev was echoing the language of Russian President Vladimir Putin, who insists that NATO is crowding Russia by supporting Ukraine’s independence, his observation about arrogance and self-confidence hits another mark.
In fact, the collapse of the USSR gave the branch of the Republican Party that wanted to destroy the New Deal confidence that their ideology was right. Believing that their ideology of radical individualism had destroyed the USSR, these so-called Movement Conservatives very deliberately set out to destroy what they saw as Soviet-like socialist ideology at home. As anti-tax crusader Grover Norquist wrote in the Wall Street Journal: “For 40 years conservatives fought a two-front battle against statism, against the Soviet empire abroad and the American left at home. Now the Soviet Union is gone and conservatives can redeploy. And this time, the other team doesn't have nuclear weapons.”
In the 1990s, they turned their firepower on those they considered insufficiently committed to free enterprise, including traditional Republicans who agreed with Democrats that the government should regulate the economy, provide a basic social safety net, and promote infrastructure. Movement Conservatives called these traditional Republicans “Republicans in Name Only” or RINOs and said that, along with Democrats, such RINOs were bringing “socialism” to America.
With the “evil empire,” as President Ronald Reagan had dubbed the Soviet Union, no longer a viable enemy, Movement Conservatives, aided by new talk radio hosts, increasingly demonized their domestic political opponents. As they strengthened their hold on the Republican Party, Movement Conservatives cut taxes, slashed the social safety net, and deregulated the economy.
In the 1990s, as well-connected businessmen began to gather wealth and power in the former Soviet republics, that deregulation made the US and the UK attractive places for these oligarchs to place their illicit money. According to a fascinating new study from Chatham House about the UK, that investment ultimately weakened the rule of law. The study concerns the UK alone, but since the UK and US are by far the world’s top exporters of financial services, many of the report’s findings are suggestive for the US as well.
The report explores how rising oligarchs accumulated illicit money in the former Soviet republics, then set out to launder it—and their reputations—in the UK. As oligarchs cleaned and then parked their ill-gotten money, they laundered their reputations by contributing to universities and other established institutions. They also began to contribute to those politicians who pushed policies that would benefit the oligarchs. Their influence weakened the rule of law.
While this study focused on the UK, it offers a useful model to frame how the deregulation of our financial industries and the consequent flood of illicit money into this country has helped to undermine American democracy.
The financial deregulation that made the US a good bet for oligarchs to launder money got a boost when, after the September 11 attacks on the US, Congress in 2001 passed the PATRIOT Act to address the threat of terrorism. The law took on money laundering and the illicit funding of terrorism, requiring financial institutions to inspect large sums of money passing through them. But the Financial Crimes Enforcement Network (FinCEN) exempted many real estate deals from the new regulations.
In the years since, the United States has become one of the money-laundering capitals of the world. Experts say that hundreds of billions of dollars are laundered in the US every year. As Representative Tom Malinowski (D-NJ) noted last year, “[I]t’s illegal for foreigners to contribute to our campaigns, but if you launder your money through a front company with anonymous ownership there is very little we can do to stop you.”
About a year ago, Congress took on this threat by including the Corporate Transparency Act in last year’s National Defense Authorization Act. It undercut shell companies and money laundering by requiring the owners of any company that is not otherwise overseen by the federal government (by filing taxes, for example, or through close regulation) to file a report that identifies each person associated with the company who either owns 25% or more of it or exercises substantial control over it. That report, including name, birthdate, address, and an identifying number, goes to FinCEN. The measure also increases penalties for money laundering and streamlines cooperation between banks and foreign law enforcement authorities.
Now, of course, the Biden administration has made addressing corruption a centerpiece of its attempt to shore up democracy both at home and abroad. In June, Biden declared the fight against corruption a core US national security interest. “Corruption threatens United States national security, economic equity, global anti-poverty and development efforts, and democracy itself,” he wrote. “But by effectively preventing and countering corruption and demonstrating the advantages of transparent and accountable governance, we can secure a critical advantage for the United States and other democracies.”
In early December, two days before the Biden administration hosted the Summit for Democracy, a gathering of 110 countries to consider ways to strengthen democracy, it announced a comprehensive strategy for countering corruption. The plan pulls together the Departments of State, Treasury, and Commerce, along with the US Agency for International Development, to expose global financial shenanigans, hold corrupt actors to account, and protect journalists who dig into stories of corruption.
In some ways, the collapse of the USSR thirty years ago helped to undermine the Cold War democracy that opposed it. In the past thirty years, we have torn ourselves apart as politicians adhering to an extreme ideology demonized their opponents. That demonization is escalating now as Republican radicals who were born after the collapse of the USSR and who therefore see their primary enemies as Democrats, are moving the Republican Party even further to the right. North Carolina representative Madison Cawthorn, for example, was born in 1995.
That demonization has also helped to justify the deregulation of our economy and then the illicit money from the rising oligarchs it attracted, money that has corrupted our democratic system. It appears the Biden administration is trying to cut off the flow of that poison. Removing it, and thus the finger it puts on the scales for certain politicians, might also help to address the extreme polarization that has come to characterize our politics and society in the years since Gorbachev resigned.
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Notes:
https://www.cbsnews.com/news/gorbachev-says-u-s-became-arrogant-after-soviet-union-collapsed/
https://www.chathamhouse.org/2021/12/uks-kleptocracy-problem/02-supply-and-demand
https://irp.fas.org/offdocs/nsm/nssm-1.pdf
https://www.treasury.gov/press-center/press-releases/Documents/js1751.pdf
Here's my Christmas letter to Chief Justice Roberts and a similar one to Justice Sotomayor. Enjoy!
The Honorable Chief Justice John G. Roberts
The Supreme Court of the United States
One First Street N.E.
Washington, D.C. 20543
Dear Chief Justice Roberts,
On this Christmas Day 2021, I feel the most important thing I can do is write to you and Justice Sotomayor on my concerns with the loss of democracy in many states and the United States Supreme Court's role in dismantling our republican form of government. Texas, the state I live in, is now an autocracy under minority rule and is blatantly and with audacity taking away my Constitutional rights.
First, I'd like to commend you for your courage and fortitude in speaking up on the Solemn Mockery now hanging over the Supreme Court. I also commend Justice Sotomayor for her statement on the stench permeating the current state of the Supreme Court.
Three points I'd like to call to your attention:
1. Rulings of the ilk of Citizens United which says money is free speech and corporations have the same rights as people are basically legalized bribery of elected representatives. Ninety-five percent of the time they now vote with their donors ignoring the wishes of the People which has made the United States into an oligarchic kleptocracy, no longer a democratic republic.
2. The gutting of the Voting Rights Act in 2013 stating that pre-clearance was no longer needed has led to extreme partisan discriminatory gerrymandering and voter suppression to assure the minority rulers stay in power assuring autocratic rule for decades to come.
3. The recent rulings by the Supreme Court on the Texas anti-abortion vigilante injustice law seem to be based on anticipating the overturn of the Roe v. Wade precedence and totally ignoring the existing Constitutional Rights of women. In my opinion, that means the Supreme Court is in Contempt of the Constitution.
While I'm not a lawyer, I am a concerned citizen who carries a copy of the U.S. Constitution with me at all times and refers to it frequently. I'm finding so many of the questions and arguments being made in recent hearings fallacious.
1. I want to hear the answers to Justice Sotomayor's fine and relevant questions about why the rights of a potential person, a fetus, is given total priority over the rights of an existing person, the pregnant woman, no matter what the risk is to her. No exceptions. My sister was a Type 1 diabetic and giving birth put her life in a precarious situation. She chose to have two sons but at great risk to her life and the life of the babies. Saying she has no choice and the government decides in a situation like this is simply cruel and inhumane. Justice Barrett's contention that is no problem to carry a fetus to term and then you can just throw away your parental responsibility by dumping the baby at the nearest fire station makes me sick. For me, Roe v. Wade strikes a fair and just balance protecting both the woman and the developing fetus.
2. I bristle when Justice Gorsuch points out the word "abortion" isn't in the Constitution and therefore the Supreme Court should just be silent about abortion. Neither is the word "woman"! So that means women have no rights under the Constitution at all?
The Guarantee Cause seems to me the relevant clause here -- that a Republican form of government (by the People or their freely elected representatives) is guaranteed in every state by the United States Constitution.
3. I bristle at the vigilante injustice Texas is invoking to get around the Constitution. That means the rich bounty hunters get to bankrupt people who can't afford to defend themselves whether they are innocent or not. This isn't Justice; it's anarchy. All rights are now at risk across the United States.
4. I believe that two of the last three Justices joining the Court are illegitimate because of then Majority Leader McConnell's contempt of the Constitution and due process and the third is unqualified. Justice Gorsuch and Justice Barrett should not be on the Court after those shenanigans. Justice Kavanaugh would have had his nomination pulled if he had been a woman blubbering in the hearings like he did. I also feel, Justice Thomas and Justice Kavanaugh should be recused from any ruling on women's rights even if justice has not yet been served on the credible claims of sexual harassment.
In conclusion, I find the Supreme Court of the United States in Contempt of the Constitution of the United States for being an anti-democratic, anti -republican force leading toward the imminent demise of the experiment with democracy. I keep thinking about women scorned and how the country will erupt when the Supreme Court overturns Roe v. Wade.
That's the legacy of the current Supreme Court - your legacy! I so hope you can turn it around to the Supreme Court who saves our American democratic republic. In addition, it may be notorious for being the first Court to take away rights rather than expand them.
Please stay strong and use a lot of air freshener! I admire you greatly.
Respectfully but emphatically,
Catherine Learoyd
We, the People, all of us this time!
In Texas, where a virus has reproductive rights and a woman doesn't!
White supremacists, Movement Conservatives, oligarchs, fascists, trumpist Republicans have all utilized othering to exploit the divisions in service of their rise to power. We do well to heed the wisdom of recently passed Desmond Tutu:
"When we see others as the enemy, we risk becoming what we hate. When we oppress others, we end up oppressing ourselves. All of our humanity is dependent upon recognizing the humanity in others.”
And for our work ahead, says Tutu:
"Do your little bit of good where you are; it's those little bits of good put together that overwhelm the world.”