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Friday, August 15, 2008

Georgia: McCain's Lost War?


Bank analyst forecast Georgian crisis 2 days early
Thu Aug 14, 2008 1:12pm EDT
By Guy Faulconbridge MOSCOW, Aug 14 (Reuters)


The outbreak of war between Georgia and Russia shocked most of the world last week, but an investment bank analyst predicted it two days in advance

Georgian President Mikheil Saakashvili sent troops into the breakaway, pro-Russian region of South Ossetia on Aug. 7, on the eve of the Beijing Olympic Games, and Russia responded with overwhelming military force.Geoff Smith, a Kiev-based analyst for Renaissance Capital investment bank, had anticipated the Georgian move with uncanny prescience in an e-mail two days earlier to a fellow strategist."So whaddaya think? I say Saakashvili is going to 'restore the territorial integrity of Georgia' five minutes before the opening ceremony starts in Beijing and dare the Russians to invade while the games are on?" the note said.Reuters has seen a copy of the e-mail and confirmed its validity with both the sender and recipient of the message.The Kremlin swiftly asserted its vastly superior military might and thousands of Russian troops pushed out Georgian troops from the rebel region. Russian units are still operating inside Georgia proper.Russian sovereign Eurobond spreads, a measure of investment risk, widened on the hostilities, and shares tumbled."It was just intuition," Smith said by telephone. "I said nothing about the possible Russian response, but if you had asked me I would say that Moscow could not have taken it lying down," Smith said. Explaining his reasoning, the former journalist said the upcoming presidential election in the United States could have played a role in Saakashvili's decision to send troops into South Ossetia."Certainly the next White House will not be as supportive of Saakashvili as this one and so if Saakashvili wanted to reunite Georgia he really had to do it this year and he was probably hoping the Olympic Games gave him the right cover," he said. He refused to forecast how the crisis would end.



McCain Talked With Georgia President On The Same Day McCain Aide Sealed Georgia Lobbying Contract
By Andrew Tilghman - August 13, 2008, 12:11PM
Randy Scheunemann earned about $70,000 serving as Sen. John McCain's top foreign policy adviser between the January 2007 and May 15, 2008. During the same period, the government of Georgia paid his firm $290,000 in lobbying fees. Today's Washington Post reports a stark illustration of the conflict of interest that Scheunemann faced while advising McCain on foreign policy matters related to the former Soviet Republic and also working for the Georgia embassy. On April 17, McCain got on the phone with Georgia President Mikheil Saakashvili about Russian efforts to gain leverage over two of Georgia's troubled provinces. That same day, McCain issued a public statement condemning Russia and expressing strong support for the Georgian position. And also on that same day, Georgia signed a new, $200,000 lobbying contract with Scheunemann's firm, Orion Strategies, according to the Post. [McCain Campaign spokesman Brian] Rogers said Orion's representation of Georgia had no bearing on McCain's decision to speak with Saakashvili in April. "The Embassy of Georgia requested the call because of Georgian concerns over recent Russian actions dealing with South Ossetia and Abkhazia," he said.The McCain campaign said Scheunemann has not received any payments from his lobbying firm since May 15 -- a few weeks after the Georgia contract was signed -- when the campaign imposed strict new restrictions on lobbying by campaign staffers. And the campaign notes that Scheunemann de-registered as a lobbyist for Georgia in March. But Scheunemann remains owner of the firm, according to the Wall Street Journal. It's not a big firm -- essentially including only one other person, Scheunemann's partner, Mike Mitchell. The firm has lobbied McCain's senate office a lot over the past few years. Orion reports making at least 71 phone calls to McCain and his staffers since 2004 to lobby on behalf of foreign clients, including Georgia.

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