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Get ready for a knuckle sandwich. Vladimir Putin is bringing
together the old Soviet bloc into “one clenched fist.” Together with China and
India and Cuba and North Korea and Iran and Vietnam, etc., the Russians are
openly saying they will put an end to America’s global hegemony.

But how will American hegemony be brought to an end?

Well, in the first place, there is this growing anti-American
alliance. Also, Russia has been involved for many years in secretive military
preparations, the misuse of IMF funds, along with stealing and hacking.

Hacking?

Consider the fact that Bill Gates made a set of keys for the Kingdom
of Internet — a kingdom that increasingly looks down on every technical
subsystem in the United States. Consider the fact that Russian hackers
recently raided Mr. Gates’ company, Microsoft, and stole the aforesaid
keys. According to sources inside Microsoft’s Redmond headquarters, the
Russians penetrated Microsoft’s defense system and stole Windows software and
security codes.

And what can be done with these security codes?

Contrary to what you might think, Russian hackers are not petty
criminals. They are soldiers in a war, interested in developing a
sabotage capability against American banks, communications systems, the power
grid and other basic utilities. Their objective is not to get rich by stealing
software. Their objective is to defeat the United States by scrambling
the brains of our computer subsystems.

Now why would the Russians want to stop the motor of the world? Why
would they contemplate a cyberattack on America? After all, where is the
profit in bringing America to its knees? Russians inevitably want what
Americans want. They want to wear blue jeans and eat burgers. They
want Coca-Cola and a big American car with tail fins.

Right?

Think again, America. Don’t believe everything you hear. Moscow has
cleverly aimed your own capitalist preconceptions back at you. They
have taken up your own slogans in order to put you to sleep. It is the
ultimate form of flattery which they employ: “America is great, Russia has
collapsed. Communism doesn’t work.”

Behind the screen provided by this flattery, Russia’s leaders can
openly plot against us, talking to their allies about defeating the United
States. Nonetheless, as this column pointed out on Thursday, the Chairman of the
Joint Chiefs simply says that Russia is not our enemy. He is more
worried about China, which has but a fraction of Russia’s power.

Capitalism is victorious, we say. Socialism has failed and Russia
wants to copy from our system. They want to copy, and they want to download
off the Internet. Do not pay attention to the man behind the curtain. Any war
preparations in Russia are merely the pathetic jerkings of a long dead corpse.

But a reversal is under way. According to Gen. William E. Odom,
writing in the Wall Street Journal on Dec. 13, “A pseudo-Soviet normalcy is
emerging in Russia as glasnost declines and perestroika gives way to new stagnation.”

Yes, a pseudo-Soviet normalcy is emerging in Russia. But Odom is
wrong to think this signifies a “new stagnation.” No, Gen. Odom, the Russian
military economy has been upgraded and modernized. To offer one
example, consider the new submarine the Russians launched last week. But we are
caught up in Russia’s lies. We still believe that only 40 or 50
fighter-bombers are being built every year in Russia. How, then, do we
analyze Russia’s voracious and unexplained consumption of electricity
and metals? How do we explain intelligence reports that say thousands of
Russian fighter-bombers are under construction?

There is something wrong and we have to wake up. We must stop
flattering ourselves with the idea that our free market system works while Russian
socialism has failed.

The fact is, our economic system is no more capitalist than Russia’s
was communist. As Ludwig von Mises pointed out decades ago, a genuine
socialist economy in Russia would have meant a reversion to the stone age. And as
everyone knows, Russia put the first man in space and built the first
intercontinental rockets. This is not evidence of what Mises called
socialism. It is something altogether different which once tagged
itself as socialist. The truth is, Russia’s economy is a radically different type
of capitalist economy, in which consumer production is limited so that
military production can be perfected. What we have called socialism in Russia is
merely a system for restricting consumption by forcibly diverting all
the best brains and material into weapons.

A couple of years ago I sat next to Col. Stanislav Lunev at a party.
Lunev is a high ranking GRU defector from Russia. Lunev and I were
listening to a retired politician praise Reagan and Thatcher for “defeating
socialism,” and for saving the free market. Col. Lunev was puzzled by this. He
leaned over and whispered to me: “What is he talking about?”

“I don’t get it either,” I replied.

“The West is a socialist paradise,” Lunev continued,
whispering again into my ear. “Each according to his ability, each
according to his need has been realized in America. But in Russia there is true
rugged individualism, with every man for himself.”

Lunev’s stunning reversal, where the West is Marxist and the East is
following a primitive capitalist model, is not without merit. For
example, most Russians grow their own food, engaging in a basic kind of
capitalism that Americans do not. The state does not really take care of people in
Russia. If you have ever been in a Russian hospital you would
understand this perfectly. Because the state didn’t really do much for the Russian
people, it forced them to do things for themselves. The Russian black
market, in reality, is a capitalist system unto itself. Perhaps it is
more free-wheeling than anything that exists in the West.

Meanwhile, in the West, corporations which resemble giant socialist
collectives have combined with the welfare state to take care of the
poor, the unemployed, and the unfortunate. Therefore, it could be said with a
little humor, that the West is more Marxist than the East.

Of course, we shouldn’t go overboard with this. The lesson to be
learned is that highly idealized categories — like “capitalism” and “socialism”
– can be very misleading when applied to real life.

Russia’s so-called “collapse” is therefore an equivocal event, poorly
understood in the West. Any assumption we make about their system, based
on our own ideological prejudices or stereotypes, is bound to be wrong.
Even more dangerous, we should not delude ourselves about the true nature of
our own system — which has become incredibly socialistic.

The real competition between nations involves a game of power
politics. To play this game you must set aside stereotypes and strive to
understand what is really happening. In doing this, you must stick to facts and not theories.

In this regard, the words of Russian President Vladimir Putin are not
theories. They express his intentions and the direction of his policy.
During Putin’s visit to Cuba, the Russian president made the following
statement. He said: “Russia intends to bridge the gap between the
so-called golden billion and the rest of humanity — and we will be solving this
question by taking our very good ties with Cuba into account.”

The “golden billion” are those who live in the developed countries –
the so-called capitalist countries. On the other side stand the global
have-nots — the “rest of humanity,” as Putin calls them. The bridging of the gap
between the two sides, according to Putin, means the end of America’s
economic and military power. He is not talking about making the poor
countries rich, but instead he is talking about making the rich
countries poor. His language is clearly not that of a business man. It is the
language of a commanding general. Talking of America’s position as the world’s
leading country, Putin said, “Similar attempts at world domination were
made numerous times throughout the course of history … and it is well known
how they all ended.”

Fidel Castro, the communist dictator of Cuba, agreed that the
dominance of America and the “golden billion” had to end. It was, after all, a
grave injustice to allow some people to live better than other people: ” Even
in the age of colonialism and slavery,” said Castro, “the poor were not
stolen from by the rich like this.”

Recently there have been cigarette ads in Moscow. A Russian brand,
named Zolotaya Yava, says it is “striking back” at America. To visualize this
process, the Statue of Liberty is depicted in a Russian fur hat.

The Russians have hacked into Microsoft for a reason. They are lying
about their own military capabilities and budget for a reason. Russia’s
president has flown to Cuba for a reason. It is time for us to set
aside the stupid idea that the Cold War ever ended.

It is time to get ready for a knuckle sandwich.

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