If you go down in the woods today, you’re sure of a big surprise
If you go down in the woods today, you’d better go in disguise
For every oligarch there ever was
Will gather there for certain because
Today’s the day the oligarchs have their picnic.
Every oligarch who’s been good is sure of a treat today
There’s lots of marvelous things to eat and wonderful games to play
Beneath the trees where nobody sees
They’ll hide and seek as long as they please
That’s the way the oligarchs have their picnic.
There’s not much difference, politically speaking, between the teddy bears of the old song, the oligarchs who believe they have just put Donald Trump in power, and the oligarchs who believe they have been keeping Vladimir Putin in power since 1999. They all want the same “treat today, marvelous things to eat, and wonderful games to play”.
In a word, money in billion-dollar tranches. And because they believe this, they have told Trump and Putin that once they get to the picnic they have planned on the Ukraine battlefield, they are bound to be able to agree on what they want to do together.
Of course, it will be in secret “beneath the trees where nobody sees”.
Between 1911 and 1915, during World War I, Robert Michels, an Italian sociologist, explained how commonplace this was. He not only described the inevitability that oligarchs would come to dominate the governments and opposition organisations on both sides of that war; this he called the “iron law of oligarchy”. He also reported that the war itself would accelerate the process by which this oligarch domination on both sides would dictate the outcome to suit the common interests of them both.
“Never is the power of the state greater,” Michels wrote,
and never are the forces of political parties of opposition less effective, than at the outbreak of war. This deplorable war, come like a storm in the night, when everyone, wearied with the labours of the day, was plunged in well-deserved slumber, rages all over the world with unprecedented violence, and with such a lack of respect for human life and of regard for the eternal creations of art as to endanger the very cornerstones of a civilization dating from more than a thousand years.
The oligarch assembly at the Trump inauguration, January 20, 2025. For more on Michels’ iron law of oligarchy applied to Russia, read this.
Today we are at roughly the same point, but oligarchs think in commercial terms, not social or ethical ones. For the oligarchs, the point on both sides is that the sanctions war over the past three years has created the largest gap between true asset value and trade value which exists in the global market today—this is the gap between the pre-war bankable value of Russian commodities, resources, and corporate assets and their discounted price under sanctions. To the oligarchs on both sides, the point is how to make money out of closing this gap through the end-of-war negotiations.
A handful of Russian sources who are close enough to the Russian oligarchs was asked to predict what the end-of-war terms are likely to be that the Russian and American oligarchs will press their presidents to agree to. Here are the terms they are predicting.
- Oil and gas. The Russians believe no agreement for relaxing the current sanctions is likely because the U.S. oligarchs have convinced Trump to use the sanctions to raise the price, profitability, and international market share of U.S. oil and gas. Trump’s latest threat is the evidence. “I’m going to do Russia, whose Economy is failing, and President Putin, a very big FAVOR,” Trump declared on January 22. “Settle now, and STOP this ridiculous War! IT’S ONLY GOING TO GET WORSE. If we don’t make a “deal,” and soon, I have no other choice but to put high levels of Taxes, Tariffs, and Sanctions on anything being sold by Russia to the United States, and various other participating countries.” One Russian source believes that last phrase of Trump’s means he will target the principal beneficiaries of the current discount trade in Russian oil and gas—China and India. Trump’s objective, the Russian sources believe, will be to keep the oil price from rising above $80 per barrel or falling below $60. “This will backfire”, an oil industry source adds. “[Prime Minister Narendra] Modi is aiming to make India a petroleum superpower. The U.S. sanctions war is helping him achieve this. There is no way Trump will have of preventing it.”
- Boeing aircraft. Over the past five years the Boeing Corporation has lost almost half its market capitalization. Safety, management, logistical, and other factors have also been losing the company’s international aircraft market share and leading to speculation of an asset break-up.
A Russian source believes that a relaxation of the sanctions on Russian operation of its Boeing air fleet would be the type of rescue Boeing needs. It is comparable, the source reminds, to the attempt to save General Motors in bankruptcy by selling its Opel division to Oleg Deripaska’s Russian Machines group—a deal Hillary Clinton stopped in 2009.
- Real estate. Russian oligarchs like Roman Abramovich and Oleg Deripaska own palatial real estate in the U.S. in Manhattan, Washington, DC, as well as in resort areas of Colorado and Florida. Relaxing sanctions to allow these individuals to recover their access to their U.S. properties, or allow them to sell their real estate for convertible cash, is the type of deal Trump and his family are believed to favour. The prospect that such a conversion will generate a large profit margin for Trump-connected buyers is a lawful bribe.
- Re-dollarization. In his campaign speech to the Economic Club of New York last September, Trump argued that the sanctions war was bad for the U.S. dollar because it will “ultimately kill the dollar and kill everything the dollar represents. We have to continue to have that be the world currency… I think that if we lose the dollar as the world currency, I think that would be the equivalent of losing a war. That would make us a third world country…you’re losing Iran; you’re losing Russia. China is out there trying to get their currency to be the dominant one… I want to use sanctions as little as possible.” Russian sources therefore expect a relaxation of the exclusion of Russia from the SWIFT payment system and other measures to boost the influence of the Russian Central Bank and its governor, Elvira Nabiullina, in Kremlin decision-making.
- Free skies. Overflight of Russia and other air route limitations were largely self-imposed by U.S., European and allied state airlines which then triggered retaliation by Rosaviatsiya, the Federal Air Transport Agency. The effect has been cost pressures on the western airlines and loss of market share. Trump is likely to claim credit for opening the skies by lifting U.S. restrictions and pressing the European Union to do the same.
- The Dubai hub, the Cyprus shutdown. The Biden Administration forced the shutdown of the tax evasion structures of the Russian oligarchs in Cyprus, and triggered their relocation to the United Arab Emirates (UAE), particularly Dubai. A source acknowledges: “they use the SWIFT system and everything they do is totally transparent to the Americans. The last three sanctions lists have so many UAE entities that we have to expect they share all the financial flow information the Americans demand. However, unlike the Cypriots, the Emiratis are not hitting at the Russians. Cyprus has been different in several ways. The Cypriots actively laundered money for the oligarchs through transfer pricing and other schemes for 25 years. They have been the primary offshore centre for Russian capital outflow without any real service to trade. By contrast, Dubai services trade and is more than an offshore centre for capital transfer–far more. The Cypriots sold passports to the oligarchs and pocketed a lot of money. The UAE has not done that. Under the U.S. pressure, Cypriots sold all their Russians out and turned into one of the nastiest of the anti-Russian states in the EU. Trump may press on Dubai to follow suit, but he won’t succeed. The UAE will preserve its role—it is replacing Cyprus, London, even Antwerp for the diamond trade. This is because it is the perfect hub for the Russians to invest in their shipping, insurance, and trade settlement systems with India and China.
How will the bears pay for their picnic?
With memecoins and cryptocurrencies, a Moscow source adds.
I believe Trump will be very nice to the Emiratis, and to the Saudis as well. The likes of Justin Sun—he’s the brain and operator behind Donald and Melania Trump’s cryptocurrency schemes–and of Pavel Durov of Telegram protect the core of their businesses in UAE, and those are businesses Trump and his family are already profiting from. It’s where they may eventually accumulate their wealth. The Trump oligarchs and the Putin oligarchs, too.