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Several valuable lessons learned

Vladimir Putin slapped down Michael Dell at the World Economic Forum in Davos and hopefully some wisdom will come from this.

Then it was time for questions. First up: Dell. He praised Russia’s technical and scientific prowess, and then asked: “How can we help” you to expand IT in Russia.

Big mistake. Russia has been allergic to offers of aid from the West ever since hundreds of overpaid consultants arrived in Moscow after the collapse of Communism, in 1991, and proceeded to hand out an array of advice that proved, at times, useless or dangerous.

Putin’s withering reply to Dell: “We don’t need help. We are not invalids. We don’t have limited mental capacity.”

Which demonstrates several things:

1. when a multinational company in effect offers to invest more in Russia (i.e “here are some assets, please confiscate them at your leisure like you did with those idiot western oil companies”), the kleptocrat-in-chief would rather pretend that his country is “not an invalid” in spite of copious evidence that Russia is an economic basket case. So yes, Vladimir Putin does indeed appear to have limited mental capacity even in his role as kleptocrat.

2. investors in Dell need to make sure that Michael Dell never ever has any say whatsoever is which places Dell invests the company’s money. Russia? Michael, are you out of your fucking mind?

A friend of mine suggested the theory that Putin was angry that Dell purchased Alienware. smiley_grinning_green.gif

23 comments to Several valuable lessons learned

  • Aww. I was enjoying that list but “several” stopped at a mere two.

  • Sigivald

    I think Putin’s reply, for once, is not too unrealistic.

    Russia’s got plenty of very competent network and computer people; it doesn’t need expertise or planning from Dell.

    And equipment, well, it can buy that as well from anyone else, and probably cheaper.

    Russia is a giant basket-case, but in this particular case, on the issue of IT improvements, it can do as well on its own as with Dell, if not better.

  • K

    I think the late Robert(?) Strauss had the right idea about investing in Russia in the early 1990s.

    His quote (roughly)

    “If I had $100K and wanted to become a rich I would go to Russia and invest it. And if I had $100M I would go to Russia and invest $100K.”

    Today that would be too optimistic.

  • In a fair and just world, Michael Dell would have then killed Vladimir Putin with his bare hands.

    Alas, we don’t live in a fair and just world.

  • K

    Some of this may have been misunderstanding. We read Dell’s words as friendly but how do they sound to Putin whose native language is not English?

    However I think Putin merely seized a chance to send a message back home. He knew his words and gestures would be widely noted.

    It was consistent with the game plan. i.e. a revival of Russian pride and power by stressing nationalism.

    Notice how he shows the flag with naval visits to Cuba and Venezuela. That isn’t intended to help Russia militarily. It is pageantry for the home folks.

  • Russia’s got plenty of very competent network and computer people; it doesn’t need expertise or planning from Dell

    Yeah that would explain why Russian companies are giving Dell a run for its money in the global computer markets. Ah, sorry, wrong parallel universe.

    More seriously, what Russia lacks is entrepreneurial sophistication because frankly that is not how people get rich in Russia. Politics is how you get rich in Russia.

    But K is correct, this was for internal consumption. Not that that makes Putin any less of a prick and anyone who backs him any less toxic for Russia’s social, political and economic well being.

  • entrepreneurial sophistication

    The question as to whether they have it is not especially relevant, because people who do and use it to make money will have their assets and profits stolen by the well connected if they are lucky, and if they are not lucky things will be much worse than that. Such a situation means that anyone who has entrepreneurial skills is going to hide them.

  • For sure Michael, which is why investing their is bonkers.

    I have met several very business savvy Russians… outside Russia. It was amazing to me how similar their reasons for getting out were.

  • Kim du Toit

    I can’t believe Dell would even have offered anything to the Russians.

  • Mike

    Russia needs rule of law. Dell can’t give them that. Once they have it, they won’t need anything from Dell.

  • Miroslav Babic

    Russia needs rule of law.

    Yes it does.

    Dell can’t give them that. Once they have it, they won’t need anything from Dell.

    To contrary, they will need help from many peoples. They still need 50 years of cultural change to mentally enter the 21st century before then everything and every country they touch turns to shit.

  • Johnathan Pearce

    In a way it is positive that the price of oil and natural gas has fallen, since it might, just might force some Russians to try and create wealth by selling things to people and by being nice rather than adopting a sort of blanket gangsterism.

    Well, we can all hope.

  • Mrs. du Toit

    The crime problems aside, I do not think they have the infrastructure/supply chain skills. If that’s what Perrry meant by “entrepreneurial sophistication” then I agree. I think it is far too easy to forget what it is like to live in a world with “tomorrow? Sure!” as the response to getting things done.

    They can’t begin to develop them because of the crime problems, as all production has to be below the radar or your production output will be stolen or the profits will be.

  • Kim du Toit

    I note with interest that Russia has just signed some kind of deal with Cuba — now there’s a much better partner for them than Dell.


  • John K

    Hands up anyone who doesn’t think Bad Vlad is a fascist bastard. Anyone?

  • He is, hands down, at least practically speaking. I doubt that he is driven by any ideology other than personal gain.

  • Patrick

    Whatever advice consultants offered after the collapse of Communism, it wouldn’t have mattered. The government apparrntly didn’t take much of it, and wound up selling off its assets for rock-bottom to politically-connected operators. This has been the cause of many if not most of the economic problems since then.

  • Paul Marks

    “Russia needs cultural change to enter the 21st century”.

    Sadly Russia is already in the 21st century – and most other countries are joining it there.

    What sort of culture is where politicians, academics and businessmen go to a Swiss resort to discuss even more world statism (and “cooperation and coordination” of world government style) and almost every media outlet reports the event AS A GOOD THING?

    The only problem most of the media suggest is that the meeting “might not achieve anything” – rather than what the main meetings are trying to achieve being evil.

    Putin is not some man from Mars – he is becomming mainstream.

    Anyone who doubts this should have watched President Obama with a group of bowing and scrapping businessmen a couple of days ago (just like the group of toadies that Putin has licking his boots) or watched President Obama and Vice President Biden go on about their collectivist plans at today’s news conference.

  • Man in Sakhalin

    Russia’s got plenty of very competent network and computer people; it doesn’t need expertise or planning from Dell.

    Yes, none of whom seem to be plying their trade in Russia. They don’t even have internet banking here. To transfer money, or even take it out in some cases, you need to queue for a couple of hours with your passport ready.

    Incidentally, Russia needs serious foreign help. Now that Gazprom has gleefully taken over the Sakhalin II project, like a drunk waking up and looking at the empty bottle of vodka and empty wallet beside him, they have realised that they are now expected to shoulder 50% of the project costs. Oh dear: Gazprom is skint, and can’t afford to pay the project completion costs (or, I fear, operating costs). It’s a bit like stealing a car then realising you don’t have enough money to fuel it beyond the owner’s driveway. So they’ve embarked on a cost-cutting exercise which will see most of us, including key personnel, out on our arses in a couple of months. I doubt Gazprom care too much about quality or safety, so they’ll get the plant running somehow, but I’ll be interested to see if they can meet their committments as regards product quality and delivery schedule.

    In addition, and this is not yet public knowledge, Exxon has walked off the Odoptu project in north Sakhalin after the Russian government started trying to dick with the conditions of the PSA, as they did with Shell on the Sakhalin II project. Exxon has simply stopped all construction and is in the process of demobilising the workforce, leaving an unifinished facility lying uselessly in the snow. Exxon are playing hardball, betting that the Russians need the money more than Exxon does.

    There’s much I could write about this, Perry will know who I am, but given my employer is Gazprom (at least for the next couple of months) I’m not too keen on writing stuff on my own blog (yet) nor using my real name. Any wrong comment from me about Gazprom now, and I’d be out on my arse for sure.

  • JoseyWales

    Putin’s withering reply to Dell:

    “We don’t need help. We are not invalids. We don’t have limited mental capacity.”

    Aaaah, if only Obama could tell the people who voted for him, and the beggar CEO’s:

    You don’t need help, you are not invalids, You don’t have limited mental capacity. (OK, scrap that last one)

  • Paul Marks

    Most of the billionaries supported Barack H. Obama and Wall Street gave most of its donations to him ( a lot of the rest of the money seems to have come from computer ISP addresses that can not be linked to individual human beings, one of the many things the media choose to ignore).

    Still Obama denounces the payments made to the very people who donated money to him – how ungreatful.

    If President Obama really wanted to bring CEO’s down to Earth he would work for the repeal of the various regulations that “protect” them from stockholders, that indeed make the “private ownership” of many American corporations just a legal fiction.

    Do not hold your breath on that one.

  • orthodoc

    Considering that “Dell” has become synonymous with “crap,” both online (see Jeff Jarvis for his saga) and in my own experience (three laptops which suddenly and without warning blow their hard drives), my fervent wish is that Dell and Russia partner long and hard. The hell with them both.

  • lukas

    What Russia needs is a good ole falling apart… People all over the country are getting upset at Moscow treating their homes like colonies to be exploited. There are secession movements among both ethnic Russians and other ethnic groups in areas as diverse as the Far East, Siberia, Bashkortostan, Tatarstan, Karelia and the Novgorod area. Give them a few more years.