Putin and Merkel Tango in Moscow, Gazprom Stirs Up Old Ghosts, But Deals Are Signed

Wolf Richter's picture

Wolf Richter   www.testosteronepit.com   www.amazon.com/author/wolfrichter

Last week, the German Parliament passed a resolution that asked Chancellor Angela Merkel to needle Russian President Vladimir Putin about the resurgence of repressive, antidemocratic tendencies in Russia. It did not go unnoticed at the Kremlin. And it paved the way, so to speak, for her trip to Moscow on Friday—to re-cement their “strategic partnership.”

Complaints about the resolution filtered back to the point where Foreign Minister Guido Westerwelle, just before departing for Moscow, warned his countrymen not to overdo their criticism of Russia. It’s in the interests of Germany, he mused, to expand the “strategic partnership”; Russia was needed as a geopolitical and economic partner.

Indeed. Merkel arrived in Moscow with her entourage that included eight ministers and corporate chieftains by the planeload—she doesn’t leave home without them. With Merkel and Putin looking on, these chieftains and their Russian counterparts signed contracts for billions of euros, a ritual that German chancellors have to perform when abroad. It’s part of Germany’s mercantilist foreign policy. Siemens CEO Peter Löscher bagged perhaps the biggest deal, a declaration of intent to deliver 695 electric locomotives for €2.5 billion ($3.2 billion) to Russian Railways (RZD), an elephantine state-owned company with 950,000 employees.

That’s what really mattered. Criticism of Russia—carefully calibrated and range-bound—would be for consumption at home, where anti-Russian sentiment has been rising. With elections coming up next year, Merkel, the consummate political animal, is treading a fine line: deliver a bland rebuke that would barely satisfy voters in Germany and help arrange deals that would fully satisfy German industry.

The initial meeting was at the concluding session of the annual Petersburg Dialogue, a four-day forum, this year titled ominously, “Russia and Germany: the Information Society Facing the Challenges of the 21st Century.” So the first question from the audience was posed by a Russian participant: what about the recent deterioration in the Russian-German relationship—a reference to the resolution—and its consequences on economic cooperation?

A government had to be able to digest criticism, Merkel said in response. Yes, some of the recent laws the State Duma had passed “irritated” her. “I cannot see that they further freedom,” she said. “We ask ourselves if that is good for the development of Russian society or not.” But that didn’t change the intense relationship between both countries. “If I were offended every time I opened the paper at home, I couldn’t be chancellor for three days,” she said. Putin smiled.

It kicked off a bizarre tangle of questions and answers, comments, attacks, and counterattacks, fact-based or not, that carried over into a panel discussion and press conference. Putin claimed that Germany had been criticized by human rights groups because some of its states didn’t have laws for the protection of information. Which baffled attendees. And about Merkel’s statement—incomprehensible, given current conditions—that Europe always tried to speak with one voice, Putin retorted: “That’s called a cartel.” Even the Pussy Riot case came up.

A representative from Gazprom, the giant state-owned Russian natural gas company without which no German-Russian meeting is complete, and on which Germany depends for much of its natural gas, complained about the “gloomy atmosphere” in the relations between both countries that was hindering making deals.

The meeting was a far cry from when Gerhard Schröder was still Chancellor. He’d raised the “strategic partnership” to new heights through his close personal and political relationship with Putin. For example in November 2004, he described Putin as a “flawless democrat,” which stirred up a ruckus even in Germany. He also championed the Nord Stream gas pipeline that would pump gas from Russia directly to Germany via the Baltic Sea, without crossing other countries, a very costly project. Gazprom controlled the Nord Stream consortium. A deal was signed in October 2005. It included a loan guarantee by the German government of €1 billion. That’s how close German-Russians relations were.

On November 22, 2005, Schröder got kicked out of office. Days later, Gazprom appointed him Chairman of Nord Stream AG, causing another ruckus in Germany; it was clear what his intentions had been all along, now that he was on the lavish payroll of the Russian government. Turns out, the Baltic pipeline would allow Russia to cut off gas to countries its other pipelines crossed on their way to Germany, while still supplying Germany—a powerful political weapon against those countries. The “strategic partnership” had made it possible.

Gazprom is deeply involved in the rest of Europe as well. For example, why would France suddenly prohibit shale gas exploration? Sure, there are environmental issues. But French governments have had, let’s say, an uneasy relationship with environmentalists. Its spy service DGSE, sank Greenpeace’s flagship, the Rainbow Warrior, killing one person. No, there must have been another reason. Read... Russia’s Gazprom Tightens Its Stranglehold On Europe: The Natural Gas War Gets Dirty.

With the euro debt crisis came absurdities. Now the currency is creating artificial problems between peoples. And by being “irreversible,” as ECB President Mario Draghi had said, it has become a curse—and a religious dictum that must not be questioned regardless of how much havoc it may ultimately wreak. Read...  The Curse Of The “Irreversible” Euro.

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falak pema's picture

Do you know which woman Merkel admires most in History ?

Catherine the GReat, Czarist Queen of Russia of German origin...

Now extrapolate...Putin is Orlov or Potemkin....to great Catherine.

Are we heading to a Catherinian era in EUrope?

MiniCooper's picture

Russia is no stronger today than it ever was.

I live in the UK and our best private schools and universities are full of the children of wealthy and middle class Russians. London is full of the homes of wealthy and middle class Russians. No one, not even Russians, wants to leave their money or their children in the country. They make money there but they dont leave anything of value there. No one expects it to last.

Having dealt with Russia before the collapse of the USSR I can tel you the mind set has not changed. Take everything you can, while you can. Everything is a zero sum game. What you win someone else loses. There is no building for the future in Russia.

That is its weakness and its history for the last 250 years.

Joe A's picture

German-Russian partnership is nothing new. Remember the von Ribbentrop and Molakov pact? Guess who got screwed there? Poland. Poland gets screwed again. I wonder what kind of light this can shed over the plane crash a couple of years ago that wiped out the Polish government.

Germany is back as the main and dominating power in Europe and it is moving it horizon eastwards. Europe does not have pleasant memories of a dominating Germany.

Bicycle Repairman's picture

I wonder what the USA would think of a German/Russo axis.  Remind me, whose troops occupy Germany?

Solarman's picture

Was just discussing that today.  It would be potent, and Germany can leave the Euro with a ready import partner at hand.  A partner that excels in military technology.  We should worry, and China should get freaked out.

q99x2's picture

RT is my best source for what is going on in the United States and around the world. Just for fun watching as a spectator I'd like to see Germany join up with Russia and China to return control of the Mid East to the people that live there.

Fuh Querada's picture

See this


for a description of regime-destabilization efforts in Russia by Washington's National Endowment for Democracy (NED) via support of MSM-worshipped opposition figures such as Navalny, Nemtsov & Kasparov. No wonder Putin passed a law compelling registration of politically active NGOs.

Solarman's picture

That's a laugh.  The russians will control it, not give it back.  How naive.

CrazyCooter's picture

Thanks for the German/Russo update. I think I read something in Stratfor a while back about a G/R alliance after Europe goes tits up; German manufacturing prowess and Russia's resources to fuel it.

Rest of Europe would be theirs to run!

From a political vantage point, Merkel is one savy frau!



coolpajim's picture

Prophetically Russia and Germany do join up in a confederation, including most of the Muslim nations, and lead a massive attack against Israel. Unfortunately for them they are miraculously destroyed by Israel's God. We could be looking at a move in that direction.

Amagnonx's picture

Israel's god is called usury, and its prophet is Rothschild - if Germany and Russia did join forces - they would know exactly where to aim a tac nuke to solve the problem.

Haus-Targaryen's picture

And by Euros he means pallets of Euros sitting right next to pallets of Marks ready to go.  

CrazyCooter's picture

If Germany had the Mark back, it would kill exports. Germany <3's the Euro for precisely that reason. They will leave eventually, but only out of self preservation, not before.

I don't know what is going to happen, but as best I can tell every "western" government is addicted to fiat for some reason or another.

The first to go back to gold or anything close gets purchasing power, not exports.



Joe A's picture

That is why Germany is working so hard to create new export market. Germany is moving eastwards, creating 'Lebensraum' for its economy.

magpie's picture

We need  the Dork of Cork here to tell us when the Eurospace as a whole swings into a hydrocarbon deficit (despite any German surplus) 

falak pema's picture

china/russia/euro axis on financial front could be a reality in two years.  If ever the Sauds join that...so be careful Israel. 

Bicycle Repairman's picture

The House of Saud serves at the pleasure of the USA/UK/Israeli axis.  In one hand I have hundreds of Israeli nukes and in the other I have zero Saudi nukes. 

falak pema's picture

Yes but nobody in first world can "nuke" the oil fields of the Hormuz, 'cos thats killing for the ages the goose that lays the golden egg.

Nope, amongst the big boys this nuke game is deterrent like during cold war, as its MAD. Nobody wants new players to enter that exclusive club for sure. We only make hot wars amongst the plebs to "vitrify" the oil patch, sterilise it, make all living souls of those lands servile and effete agents of Pax Americana; or die. 

And China/Russia couldn't give a rats ass about what happens to the locals. They are also interested in getting their hands on ME oil, water of its rivers, to strategically control the region; old, perennial continental great game.

The only people who care about the destinies of the desperate and damned in this rip-off of extractive empires; hell bent to extracting their pound of flesh as well the oil gravy with it; is the leadership of those people, inexistant today clouded in obscurantism, internecine feudal battles of another age.

The soul of a nation beats from within. But "they" have to liberate it from its past; inextricable gordian knot. Where is Alexander?  

Israel's true ploy to survive in current apartheid mode as Templar fortress is to play on these strategic and cultural divides. They have a real base in their powerful lobbies both in USA as in Europe, but they are digging their own hole like the South African elite did or the third reich before them. 

Freedom never gets handed to anybody on a plate. But push a mouse to an inextricable hole and it could change its nature. The Saud oligarchy is very fragile behind its facade of US army cover that patrols it from bases. Its just a question of popular perception fed on recurrent deprivation; when the soul of nation awakes. 

ciaoant1's picture

Here is another gem from that meeting - Russia and Germany coming together - and the euro has a lot of support outside the West: http://www.smartmoney.com/news/on/?story=ON-20121116-000414&cid=1259


Russia has no doubts with regard to the resilience of the European economy, Russian President Vladimir Putin said. "Otherwise we would not hold 40% of our foreign reserves in the euro," he said...


Also in the news today:


Foreign Buying of U.S. Assets Plunges on Europe Optimism

Food for thought...

Mr Lennon Hendrix's picture

Of course he says that.  They buy his oil.