Ukrainian Dance

Everyone asks me about Ukrainian national dance. It can be different. Here is a link to the performance by the Zorya Ukrainian Dance Ensemble at the Texas State Fair, Dallas, TX on Oct 10, 2010. It was awesome.

The 2010 Nobel Prize in Economics

Peter Diamond (MIT), Dale Mortensen (Northwestern U), and Christopher Pissarides (LSE) won the 2010 Nobel Prize in Economics for their contributions to the theory of unemployment. Congratulations! Their work on job search theory, wage stickiness, hysterisis, job creation, and job destruction shed new light on our understanding of unemployment.
It's interesting that the US Senate rejected Peter Diamond's nomination for the Federal Reserve Board back in April 2010. His intellectual influence still carries on to the FED through his former student and current chairman of the FED, Ben Bernanke.
Also, the 2010 Nobel Prize in Economics is a good reason for celebrating the Austrian Economics because the prize-winning work on employment includes insights from the Schumpeterian creative destruction and the Hayekian discovery process.

Yanukovich's Party of Regions Beats Up People, Cuts Down Trees, and Auctions Off Public Park

Kharkiv, the second largest city of Ukraine, became a place for the blood-shedding stand-off between residents of Kharkiv and the Kharkiv mayor. On June 2, 2010, the mayor's security service stormed a camp of protesting Kharkiv residents. The Kharkiv police observed the battle without taking any sides. Protesters sought refuge in the standing-by police officers who denied them in protection. The protesters were insulted, beaten up, threatened with chain saws so they had to flee. The police arrested and removed the remaining protesters.

Kharkiv residents were protesting mayor's decision about real estate development of the city park, Gorky Park. The park's square footage is approximately five times as big as New York's well-known Central Park. According to the real estate development plan, the private contractor would built a highway across the park and gated residential communities with amenities such as tennis courts and swimming pools. The plan looks like a normal real estate development but it violates the law. The Gorky park is public property designated for recreational activities. It cannot be a subject for a real estate development. 
I watched the events closely because it's my hometown. I hoped that the common sense would take over corruption and lawlessness. It didn't! Kharkiv's deputy mayor Gennady Kernes and Kharkiv's governor Michael Dobkin who are members of the presidential party, Party of Regions, were ruthless and unstoppable.  
Here is a link to the documentary(CNN video) that shows how the stand-off between residents of Kharkiv and the Kharkiv mayor's office ended on June 2, 2010. It's shocking that the police officers did not protect citizens from unidentified security guards (thugs) who removed demonstrators from the designated area of real estate development. The video has comments from the crime witnesses. Subtitles have a correct translation.
Here is a link to the website of NGO Kharkov Forest.
Here is a map with the real estate development plan of the Gorky park, provided by the NGO Kharkov Forest.

A Farewell to Democracy, Free Media, and Free Enterprise: Ukraine's Prospects Revised

In my old post I wondered whether Ukraine had a strong political opposition to counteract advances of President Yanukovich against democracy, economic freedon, and free media. My answer was yes. And I  was too optimistic. I thought that either former prime minister Yulia Tymoshenko or former president Viktor Yushchenko could stop the Yanukovich machine. They failed again. Everyone left Tymoshenko. Her former sponsors and party members are in the Yanukovich team now, not always voluntarily. Yushchenko is a political ghost. Nobody can stop President Yanukovich and his Party of Regions, at least, in Ukraine. The Yanukovich administration did more in six months than the Kuchma administration in ten years. The Yanukovich administration curbed media freedom, oppressed small-scale and medium-size business, and installed dictatorship.     
A farewell to freedom of speech. The Yanukovich administration curbed freedom of media really fast. Ukraine's mass media looks like Russian media now. Nobody criticizes President Yanukovich openly. It got to the point that the Voice of America can lose its broadcasting partners in Ukraine very soon as it happened in Russia. 
A farewell to free enterprise. The Yanukovich administration hammered small-scale and medium-size businesses with oppressive tax policy. The new tax code promises to become the apocalypse of economic freedom in Ukraine. All small-scale and medium-size businesses move their operations to the shadow economy before the new tax code will go in effect.
Finally, a farewell to democracy! The Yanukovich administration won the case vs the 2004 Constitutional Amendment in the Constitutional Court of Ukraine. The 2004 Amendment was very important step in Ukraine's democratization. It was once in a lifetime opportunity.  In brief, this amendment separates powers between president and prime-minister where the former is responsible for foreign policy and the latter takes on duties of domestic policy. Not anymore! The executive power is centralized now! The Constitutional Court ruled last Friday that the 2004 amendment violated the Constitution of Ukraine and thus the Constitutional Court overruled it. Did I mention that right before the seminal ruling four judges of the Constitutional Court were replaced with four new judges affiliated with the Party of Regions.
So, Ukrainians, please, say a farewell to democracy for the next five years at least. But it's no the saddest part. It's really sad that if Yulia Tymoshenko won the presidency, she would do the same. The only difference is that the Party of Regions could stop her. Who is going to stop the Yanukovich machine?   

Happy Birthday to Ludwig Von Mises!

Today, 129 years ago, the distinguished economist and the leader of the Austrian School of Economics was born. His work is outstanding. It is very broad ranging from topics of socialism to the quantity theory of money. Ludwig Von Mises taught at the University of Vienna, Austria, and later at New York University, USA. If you have not read his work, please, start reading it now. 
It's a very interesting fact that Ludwig Von Mises was born in Lemberg in Galicia province of the Austro-Hungarian Empire. Now,  Lemberg is know as .... Lviv, Ukraine. I wonder whether anybody celebrates his birthday in Ukraine?

Facebook of Ukraine's Agriculture

 Let me introduce Volodimir Ambrossov (Professor at Kharkiv State Agricultural University) and Viktor Stotsky (former governor of Novodalazhsky county, Kharkiv province). They played and continue to play a very important part in the economic development of Ukraine’s agro-producing industry. I have a huge respect for them. Dr. Ambrossov and Mr. Stotsky are the faces of Ukraine’s agro-producing sector.


Dr. Ambrossov is a seminal figure in Ukraine’s land reform. He worked together with Pavlo Gaydutsky (former Director of Department of Agriculture) on the project of the 1999 Reform. Dr. Ambrossov is not an arm-chair agricultural economist. He served as President Kuchma’s representative in Kharkiv province. His main task was to advance the land reform and supervise the land privatization. Now he leads a consulting group that conducts analysis of agro-producing industry.
Mr. Stotsky actually knows Dr. Ambrossov very well. They were classmates when they went to Kharkiv State Agricultural University. Since then their paths have crossed many times though they chose different career paths. They are still friends. Mr. Stotsky started his career as a farm manager. Later he was elected as a governor of Novodalazhsky county in Kharkiv province. Now Mr. Stotsky serves as an economic adviser of Kharkiv deputy Shklets.



Dr. Volodimir Ambrossov.



Viktor Stotsky.



Fact of the Day

Average Ukrainian household spends almost 60 percent of its income on food (thnx2: Ukrainian Economist’s Oleksandr Shepotylo). Only three percent of the household income goes into eating out and entertainment. According to the CIA World Factbook, Ukraine’s GDP per capita was $6,300 in 2009 (134^th place in the world).

The SUSTA Protests against Ukraine’s President Yanukovich in New York

I didn’t blog for some time. But Ukraine is getting more interesting with every day since Mr. Yanukovich became Ukraine’s president. Today I received a message on Facebook from the SUSTA – The Federation of the Ukrainian Student Organizations of America. Today the SUSTA members will protest against Mr. Yanukovich’s visit to New York. The Ukrainian Weekly will feature their demonstration. Here is a message:


On the occasion of today’s visit by the newly-appointed Ukrainian President Victor Yanukovich, members of SUSTA - the Federation of Ukrainian Student Organizations of America (Союз Українських Студентських Товариств Америки), along with the Ukrainian-American community and the worldwide Ukrainian diaspora would like to share with you our deepest concerns regarding the recent anti-democratic developments in Ukraine.

In the recent months since his election into office, the pro-Russian President has taken alarming steps to compromise Ukraine’s national identity and sovereignty. To name just a few:
•the unconstitutional extension of the lease for the Russian Black Sea Fleet in Crimea;
•the rising dependence on Russia to provide for Ukraine’s security and stability which poses a definite threat to Ukraine’s sovereignty;
•the denial of Holodomor as an act of genocide and its removal from the official presidential website;
•recent censorship of the press, targeting several independent Ukrainian television stations;
•the new government’s move to control the judicial system by granting the president power over the hiring and firing of judges; and,
•the non-bloc status of Ukraine, which threatens Ukraine’s Euro-Atlantic integration and future NATO membership

As if these were not enough, certain parliamentarians of President Yanukovich's Party of Regions, together with some satellite parties, appointed a controversial figure by the name of Dmitri Tabachnik as the Minister of Education and Science of Ukraine. Sadly, Mr. Tabachnik is widely known for his anti-Ukrainian, anti-democratic, pro-Russian, xenophobic attitude towards ethnic Ukrainians, especially to those living in the Western part of the country. In some of his statements, he has specifically formulated discriminatory wording which is comparable to that used by the Nazi propaganda with respect to the Jewish people during WWII. In fact, he proceeded to follow policies which diminish the Ukrainian language on the national level (i.e. cancelling university examinations in the Ukrainian language, issuing decrees to cease movie translations in Ukrainian, intimidating and arresting university faculty and students for simply exercising their democratic rights, etc)…

It is hard for us all to observe Mr. Yanykovich’s and Mr. Tabachnik’s current reversals of the former President Victor Yushchenko’s democratic policies. It seems that the current administration’s damaging political actions reflect the refusal to acknowledge Ukraine as an independent country and threaten the very existence of Ukraine as a young democratic nation. As citizens of the Ukrainian-American community (and the world Ukrainian community at large), we are greatly disturbed by these recent anti-democratic policies of Mr. Yanukovich, his newly-appointed government and parliamentary counterparts. As proud Ukrainians, we firmly uphold and vehemently defend a strong, self-sufficient, independent state where Ukrainians are free to express their opinions, are cognizant of their culture and history and are proud of their unique heritage!

The time is NOW! We cannot allow President Yanukovych to threaten Ukraine's freedom any longer!!! We must defend Ukraine’s integrity and sovereignty!

We would like to thank all of you for joining us here today to voice your own concerns regarding the future of Ukraine as a country, its independence and the plight of its people. It is up to each one of us…

Sincerely yours,
Vera A. Partem, SUSTA 2010-2011 President and Executive Director
Olya Yaruchkivska, SUSTA 2010-2011 Vice President
Roksolana Starodub, SUSTA 2010-2011 Treasurer
Ostap Tymchyk, SUSTA 2010-2011 Secretary

The Post-Soviet Potemkin Village

I am reading a book "The Post-Soviet Potemkin Village: Politics and Property Rights in the Black Earth" that is about land reform politics in Russia and Ukraine. It is written by Jessica Allina-Pisano, an Associate Professor in the School of Political Studies at the University of Ottawa. Professor Allina-Pisano conducted more than 300 interviews in Ukraine and Russia between 1997 and 2006. So far I just read two chapters that showed her profound knowledge of the politics in Ukraine and Russia. Her research is very interesting and I look forward to reading her book.

Ukraine’s Fiscal Policy Hurts National Exporters

Ukraine's fiscal policy forces the national exporters to a bankruptcy. A large number of export-oriented companies complain that the state refused to issue VAT (value-added tax) refunds because of exponentially increasing foreign and national debts. In Ukraine the Commerce Code and the Tax Code clearly state that the exporting companies should receive VAT refunds to avoid a double taxation because their products are subject to VAT in the importing countries. The state, however, issues tax refunds only to few companies that supported President Yanukovich in the 2010 Presidential elections. Other companies have to pay a high price for their political views. One of the largest steel-exporters, Arcelor Mittal, plans to lay off thousands of workers if the company does not receive VAT refund in the amount of $312 million (2.5 billion UAH). A transnational agro-producing corporation, Cargill, left the Ukrainian grain market because the government refused to reimburse VAT in the amount of $100 million (800 million UAH). Other exporters also face potential downsizing if the state defaults on VAT liabilities.