Russia Marks Ninth Anniversary of Default

Aug. 17 (EIRNS)—Dozens of Russian commentaries and analysis of the unfolding global, systemic financial crisis today took note of the fact that it is the ninth anniversary of Aug. 17, 1998. On that day, Russia went into technical default on the equivalent of $40 billion in short-term government bonds, called GKOs, which had been a favorite destination of hot money from around the world during the preceding months. This was the "surprise"—though clear warnings had come from EIR, and from Russian economist Sergei Glazyev—that precipitated the Long-Term Capital Management (LTCM) hedge fund debacle and systemic near-meltdown in September 1998. In a commentary posted on KM.ru, Glazyev reminded readers that the financial disaster of 1998 resulted from "the deliberate construction of a debt pyramid," with the inevitable outcome of all such Ponzi schemes.

Long-Distance Strategic Bomber Patrols Resumed

Aug. 17 (EIRNS)—Russia has permanently resumed long-distance patrols by its strategic bombers, Russian President Vladimir Putin announced today at Chebarkul, the site of Shanghai Cooperation Organization (SCO) joint military maneuvers. Such flights had been suspended after the end of the Soviet Union in 1991, RIA Novosti reported. "I made a decision to restore flights of Russian strategic bombers on a permanent basis, and at 00:00 today, Aug. 17, 14 strategic bombers, support aircraft, and aerial tankers were deployed. Combat duty has begun, involving 20 aircraft," Putin announced.

"As of today, combat patrolling will be on a permanent basis. It has a strategic character," Putin said. "We act on the assumption that our partners will treat with understanding the resumption of strategic air flights. Our pilots have been grounded for too long. There is strategic aviation, but there are no flights."

Three days earlier, the Russian Air Force announced that units of the 37th Air Army of the Strategic Command had begun tactical exercises over the Atlantic and Pacific Oceans, Novosti reported. "In all, over 30 Tu-95 Bear-H strategic bombers, Tu-22 Backfire-C theater bombers and Il-78 Midas will be conducting flights Aug. 14," said spokesman Col. Alexander Drobyshevsky. "During the exercises, the crews will test-launch cruise missiles over the Pacific and Atlantic Oceans and fly to the North Pole."

Putin Visits Upgraded Anti-Missile Radar

Aug. 14 (EIRNS)—"This is what we call modern development of the Armed Forces," Russian President Vladimir Putin remarked at an Aug. 11 ceremony inaugurating an upgraded early warning radar station, outside St. Petersburg. The phased-array antenna, electronics, and other new components increase the station's observational reach from an area at the North Pole to the south of Africa. Putin praised former Defense Minister Sergei Ivanov, for his attention to the modernization of the Armed Forces. This new generation of stations, of the Voronezh type, is replacing older ones, and is also the model for a similar station being built in Armavir, in southern Russia, which President Putin proposed to President Bush be used as an element of a joint ballistic missile defense system.

SCO Prepares for New Silk Road

Aug. 17 (EIRNS)—Shanghai Cooperation Organization (SCO) member nations completed week-long joint military maneuvers today at Chelyabinsk, in Russia's Ural mountains, observed by the Presidents of Russia, China, Kyrgyzstan, Kazakstan, Tajikistan, and Uzbekistan. The exercises, Peace Mission 2007, will likely become the basis for a permanent training program for SCO troops.

The day before, the Presidents of Russia and China called for building strategic joint relations, at their bilateral meeting in the context of the SCO summit in Bishkek, Kyrgystan. Putin said at the meeting that, "We all keep working in order to ensure our relations with China acquire genuinely strategic traits," Itar Tass reported. Hu Jintao called for "timely coordination between China and Russia" of their policies on bilateral relations, and key regional and global issues, Xinhua reported.

Energy, transport, and education were the key development issues at the SCO summit. Kazakstan's President Nursultan Nazarbayev told the meeting that the SCO "should actively work in the direction of creation of a single transit-transport system between Europe and Asia. It is necessary to attract international financial institutes for the establishment of a transcontinental transport corridor between Europe and Asia representing traditions of the Silk Road," he said.

Iranian President Ahmadinejad attended the SCO meeting, after a tour of Central Asian nations that focussed on economic cooperation.

Russia Launches $20 Billion Fusion Power Plan

Aug. 16 (EIRNS)—The Russian government today adopted a draft strategy to accelerate development of a fusion power industry. The meeting instructed the Federal Agency for Nuclear Power to prepare a revised version of the document by Oct. 1. This will allocate 515 billion rubles (about $20 billion) for fusion energy, including construction of commercial thermonuclear reactors, through 2050. Leading Russian nuclear scientist, Academician Yevgeni Velikhov, said that Russia must adopt a federal targeted program on research and potential use of fusion energy this year, according to Novosti. The program has the imprimatur of Deputy Prime Minister Sergei Ivanov.

Velikhov, president of the Kurchatov Institute in Moscow, told journalists late yesterday, just before this government meeting: "If we fail to adopt this [fusion research] program now, we will soon lose the existing scientific potential and professional cadre [to implement the strategy]." He said the 2009-2015 program would become the first stage of the fusion power strategy; this would include modernizing technologies which had been developed in Soviet times. The second stage, 2016-2031, is for development and testing of materials for fusion reactors. The third stage will begin after 2031, when Russia should design and start building commercial fusion power plants, Velikhov said.

Russian Space Legend: Build Bases on the Moon

Aug. 14 (EIRNS)—Speaking to journalists Aug. 13, 95-year-old Academician Boris Chertok, the highest-level living space official, who goes back to the Soviet space program of the 1950s, urged that Russia move away from being a raw materials producer, to create the technical capability to build bases on the Moon. He knows this is possible from first-hand experience, having worked for 20 years with Sergei Korolyov, the Soviet space program's "chief designer." Said Chertok, "There are setbacks in related industries, for instance, in electronics. Our economy in its present state will not permit solving the ambitious tasks" that the space program should tackle.

Chertok's remarks follow those of another elder statesman of science, Academician Erik Galimov, director of the Vernadsky Institute of Geochemistry and Analytical Chemistry, who also addressed the lack of vision from the leadership of the Russian space agency Roskosmos. A fight over space policy in Russia has been raging for months, and only recently have these science patriarchs publicly attacked the government policy. The fight was punctuated by the firing of Nikolai Sevastyanov from the leadership of the Energia Company in June. Sevastyanov had proposed a multi-stage lunar exploration program, culminating in manned missions, and the mining of Lunar helium-3 for fusion power plants on Earth. These plans had not been supported, or approved, by Roskosmos.

Chertok believes that it is "senseless to simply repeat what the Americans did at the end of the 1960s [Apollo program]. There must be a base on the Moon." Energia, for which Chertok consults, has proposed replacing the 1950s-era manned Soyuz capsule with the reusable Clipper spacecraft. Chertok's main point is that Russian R&D and high-technology industry must be upgraded, through a commitment by the government, to creating new mission capabilities.

Russians Treat Train Bombing as Terrorism

Aug. 14 (EIRNS)—The evening Nevsky Express passenger train on the heavily traveled route from Moscow to St. Petersburg derailed the evening of Aug. 13, in what officials called a likely bombing. It happened in Novgorod Region. There were no fatalities, but 25 of the 250 passengers were hospitalized.

Russian investigators said the explosion was equivalent to 3 kilograms of TNT. It may have been detonated by remote control, or by the impact of the locomotive, they said. The explosion appeared to go off about 100 feet before an elevated bridge over a stream, but the train, traveling at 180 km/h, cleared the chasm and then derailed on the other side as the engineers activated emergency braking.

The Russian government went into a high-profile mobilization. President Putin, who was traveling on the Yenisei River in Tyva with visiting Prince Albert of Monaco, held phone conferences with Federal Security chief Nikolai Patrushev, Transportation Minister Igor Levitin, and Russian Railways CEO Vladimir Yakunin. The latter cut short a trip to Siberia, and was shown on TV in shirtsleeves at the scene of the derailment, overseeing rush repair efforts for Moscow-St. Petersburg train service. Putin put Health Minister Vladimir Starodubov in charge of relief for the victims.