Palms & Company Document

RUSSIAN ECONOMIC DEVELOPMENT: PROGNOSIS

by

Dr. Pyotr Johannevich van de Waal-Palms

TO Alexei L. Gorshkoff

Russian Government Bureau of International Humanitarian Aid And Technical Assistance (BIHATA)

121200 Moskba G-200Smolenskaya -Sennaya Pl. 32/34

Tel 244-2805

Fax 244-35-75

Personal Tel/Fax 244-2072

Subject: Your fax Nov 23

Uvajhaemi Gospodin Gorshkoff

I understand very well the existing obstacles of government policy which restrain investment in economic development in Russia. Your opinion about the solutions requires a different variant then what you suggest.

The actual use of the results of technical assistance to create concrete results is no more than 5% This could be corrected. Your suggestion to change the use of technical assistance to a focus on pre-investment investigation can not improve the achievement of the task due to the donor laws. The correct way would be different. Such a way could be implemented with the cooperation of Russian government and that of Moscow and Moscow region.

If the Russian Center for Promotion of International Investment at the Ministry of Economy and some Russian Investment companies and financial-industrial groups request it by e-mail, I am willing to conduct a dialectic with them how to create this process, by e-mail.

Between 1989 and 1995 I have informed many contacts that I am willing to do this and I invited their reply.

Volgograd Administration <admin@icc.tsaritsyn.su>,

US Information Agency Moscow <nwpilugin@glas.apc.org>,

"U.S. Russia Business Development Committee" <warshaw@usita.gov.>, Sberbank, Perm <root@savbank.perm.su>,

Russian Privatization Center <dpanina@glas.apc.org>,

Russian Commercial Industrial Bank <biznes@greatwth.spb.su>,

Russian Privatization Center 2 <jblasi@glas.apc.org>,

Russ Analytical Center <sim@idacen.msk.su>,

Russian Research Institute Alex gruntsev <granpo@isrir.msk.su>, Nikoruk Miroslav FDGD <letter@amm.ac.msk.su>,

Kyrgyzia State Property Fund <obrien@obrien.bishkek.su>, President Kuchma of Ukraine <postmaster@ribbon.kiev.ua>,

Mr. Kazakchenko Administration of Khabarovsk <jane@fair.khabarovsk.su>, International Exeutive Service Corps Nizhniy Novgorod <iesc@sovusa.com>, International Finance Corporation Moscow <ifcnng@glas.apc.org>,

Guriev Marat, Administration of Pres. Yeltsin <marat@guriev.niiros.msk.su>,

Vyatka Regional Government <postmaster@centr.vyatka.su>, Georgian Parliament <guram@parliament.ge>,

Fyodorovna Claudia Yakutia State University <yucnit@yucnit.infonet.yakutia.su>,

Fitch Shelley, American Business Center Volgograd <shelley@abc.tsaritsyn.su>, Russian Privatization Center <news@RPC.glas.apc.org>,

Russian Privatization Center <dpanina@glas.apc.org>,

Tashkent Ministry Foreign Economic Relation Uzincomcenter <root@komil.ecoc.tashkent .su>,

Mosocw Duma <duma@glas.apc.org>

All of these documents are available in the internet. My data base is contained in a Webserver in Moscow.

The scheme you propose for realization will work only if it is not based upon Russian structures. There is an inherent flaw in such schemes which contain the existing restraining feature you mentioned in the beginning of this letter. For realization it is necessary that the solution be of a non-Russian design.

Posle tshatelnix razmishlenij ob etom , ya dumayu shto vi poluhite naibolee konkretnye rezultaty esli vy predprimite sleduyusthie shagi. The proper function of the IIU organization you have formed, can only logically be as a recipient of such solution and not as the designer. If you wish, I shall explain to you the reasons for this.

I appreciate your invitation to join in an economic reconstruction effort. Eto bilo otshen lubezno s vashej storony. Ya ne mogu soglasitsya s tem,

hto Vy predlagaete. Only, if you are willing to modify your mind-set in the manner I have proposed, would I be willing to participate. Your proposed approach can only result in a repetition of past failures. It is not realistic to think otherwise. To change the result you must change the scheme.

If you wish to discuss this with my interlocutor Alexander Mikhailovich Volovik <root@norma-press.msk.su>, you can reach him at

10100 Moscow, Russia

22 Myasnitskaya St.

BI-GA-SI

(founder PromStroyBank, MosBusinessBank, Russian National

Commercial Bank, RosNefteGas Stroy TRSB, exchanges RTSB, MBB, SpbFB, RFB, International Corporation "System of Electronic Banks & Exchanges (SEBB), Inter-privatization Fund.

A. Volovik

S. Nekhaev

Tel (7-095) 921-1331, 924-4237

Fax (7-095) 921-2732

E-Mail: root@norma.press.msk.su

I invite any of the proposed participants to communicate with me about any questions and to conduct a positive dialog abut these questions. Spasibo za Vasche predlozenie. I appreciate your invitation to use my competence in the solution of economic development programs for Russia, which is entirely possible for realization and which interests me greatly. This can only be realized in a pragmatic and realistic way.

Wsego horoshego,

C ywazeniem i w ozidanii otveta.

Dr. Pyotr Johannevich van de Waal-Palms,

Doctor of Economics and President

Palms & Company, Inc., Investment Bankers. Washington, USA

Palms Venture Capital Fund of America

United States Interbank Currency Exchange

United States Fur Exchange

U.S. E-mail Business Management Education Services

palms@PeterPalms.com

Informaziia o nawej deiatelnosti mojet bit naidena cherez Internet v nawei baze dannix po addresu

WWW : http://www.peterpalms.com

Moskba: http://alice.ibpm.serpukhov.su/friends/home.html

"Delovoi Yuridicheskii Zhurnal" http://www.dux.ru/win/enpp/newspapers/blj/arts/blj-3-art-8.html

FTP : ftp.eskimo.com:/usr/ftp/palbank

(login in :'anonymous' parol : 'ispolzuyte vaw emai adress)

Esli u vas tolko email adress i net Interneta, zaprosite

spisok naimenovaniy faylov i mi ix vam powlem. Zatem vi vi smowete zakazat fayli po imeni i oni budut vam poslany cherez email

END - FINIS

>From Dr. Gorshkoff

Dec. 22, 1995

I am in possession of your e-mail message and very obliged for your constructive response. I consider your suggestions very reasonable. But Its realization depends the will of donors rather than on us. I am eager to continue our discussion.

END - FINIS

>From palms@PeterPalms.comThu Jan 11 09:36:29 1996

Date: Mon, 25 Dec 1995 17:19:05 -0800 (PST)

From: "Dr. Pyotr Johannevich van de Waal-Palms, American_Bank, USA" <palms@PeterPalms.com>

To: Dr. Alexsei Gorshkoff

Chief of department

Russian Bureau for VOHROSAM MESJDUNARODNOI GUMANITARNOI I TECHNICHESKOI POMOSHI

Moi druk Dr. Gorshoff

Together we both agree what good results we want to accomplish in technical assistance for economic reconstruction of Russia. Now we must agree about the way to do it.

The will of the donors can be no greater than the will of the Russian people and depends upon the Russian people.

The ability of the world today, to come as donors to the economic assistance of Russia, exists because the world sheltered and protected the economic capability and potential of the human individual. We must protect that ability for future generations. Those who received help from these individuals, like Germany and Japan in the past, must earn the right to it by their willingness to use this help efficiently and without themselves creating obstacles or waste or socially unjust distribution. That is an obligation and responsibility of everyone who receives help from anyone.

You are right. Someone must give and be a donor. I ask you to try to define with me what is the description of this "donor" upon which realization depends. I say he is Russian.

A problem for which there is no solution is a sad think when it involves 150 million people. But if a solution exists for a problem and it is not used, that is unforgivably tragic.

Let us discuss this situation.

THE SITUATION AS IT IS NOW IN THE PAST MUCH WAS GIVEN ALREADY

1. Between 1989 and 1996 there have been a lot of donors of all nationalities who have contributed hundreds of billion of dollars to Russia. Now some new donors are needed who must be Russian. I have described the changes that are needed and that can only be done by Russian donors.

WITHOUT RUSSIAN PARTICIPATION, THERE IS NOT ENOUGH

2. All the governments of all the world and all private donors of all the world together, are not sufficient to give all the help that the Russian people require. The planet cannot support 250 million people who do not cooperate to support themselves. The Russian people themselves must participate and agree to assist. They have not done so yet.

THE RUSSIAN POPULATION DOES NOT HAVE MUCH, BUT ONE MILLION RUSSIAN HAVE A LOT THAT BELONGS TO THE POPULATION.

3. Privatization has not been fair. It has created one million rich Russians and made 149 million suffer a reduction of 75% in their earnings as a result. Each of these 1 million Russians is richer than any one of 90% of the American population. Almost 200 million Americans, while living a far better life than 149 million Russians, really have quite little compared to these million Russian nomenklatura. I call them the nomenklatura. Your newspapers write that Russian rich are billionaires and American rich are only millionaires and have nothing to compare to what rich Russians have. More than $250 billion dollars of "flight capital" is in Western banks belonging to these nomenklatura.

4. As a group, in the aggregate, the total population of Russia is not rich, but it has resources, both human and natural and also money which, together with donors and investors, can enable Russians to increase production to support themselves by exports. But the money and natural resources have been taken by about one million Russians who have the power in their country. This nomenklatura has left the rest of the Russian population with nothing. Russia cannot be rebuilt by donors alone when such a drain exists on what belongs to the Russian people. The Russian population cannot ignore this and still ask donors to return what the Russian nomenklatura has taken. You must get back what belongs to the Russian people and use it to assist in your economic progress. If you do not do that, how can anyone help you with donations? Such further donations will disappear, just like past donations, into the hands of the nomenklatura and you will still have nothing. The donors will be poorer wiser and sad that their sacrifice did not help you. Donors do not want to waste their money and see it go into the hands of rich Russians and not the Russian people.

5. There are Russians who buy houses here in Seattle for more than $1 million dollars. They buy the best of everything. Ferrari autos for more than $200,000. Shoes for $250 per pair. This is happening all over America, Europe and Asia. Social injustices have to be corrected to return tools of economic expansion from the nomenklatura to the people. Then donors work will help.

THE DONORS ARE POORER THAN THE RUSSIAN NOMENKLATURA

6. Most American cannot afford to buy the things rich Russians buy in America. Many Americans work for $8 per hour and earn only $16,000 per year. That is a lot in Russia, but here it is just enough to pay for housing and food. A 80 square meter apartment costs $8500 per year rent. Food for a family of four costs more than $100 per week. I do not say these people still do not have better life than people in Russia. I say that you cannot expect them to be donors to the population of Russia while they see that the "rich nomenklatura" of Russia take their money and it does not benefit the Russian people. You cannot expect these American, European and Asian people to be able to help the population of Russia, if the nomenklatura keeps $250 billion dollars in bank accounts outside Russia. Where are the hearts of these Russian nomenklatura to help their own people and country?

Of course I understand that the people now who have power in Russian government and their laws will soon take any capital from anyone who brings capital to Russia, whether they be Russians or some other nationality. So it is understandable that honest Russians, with honestly earned capital kept in other countries, are waiting for some time in the future when they have some confidence in a fair government with fair taxes and rules, before they think to bring their money back to Russia to rebuild its economy. You and I also know that some people will never bring their "flight capital" back to Russia because if it was known what methods they used to get this money they would be forced to return it to the Russian population from whom it was stolen. Only the Russian people can initiate and undertake this restitution by the nomenklatura.

WHAT IS THE RESULT.

7. The result of all this is as I have described it to you. The U.S. government takes some tax money that is also badly needed by the American population for better medical care and pensions for the old. With this money the U.S. Government hires American consultants to give advice to Russians. The result is zero, nothing. As long as the Russian people's human resources are kept idle, and their natural resources and money are exploited by an elite, to help of donors help will continue to be wasted.

WHERE ARE WE GOING

8. The Russian people must become responsible for the actions of their country. It is not enough to work to survive. They must take constructive action to create social justice. That is an obligation of the Russian people towards donors. The world cannot help the Russian population if all of Russia's resources are in the hands of the nomenklatura.

At the moment Russia's economy is still dropping down. Governments cannot stop this. Only Russian people can stop this, aided by other people of good will. Actually , it is not dropping. It is being transferred to nomenklatura bank accounts outside Russia.

Maybe the only power you, and others like you in Russia, have now is just to publicize this situation and educate the Russian people so they will understand that no "ism", neither communism nor capitalism, can help them. They can only help themselves. They have to create conditions that allow them to help themselves. It is necessary for the people of Russia to create the power to change this situation. Such changes will bring the donors. If the Russian people do not create such conditions then donors will be unable to help the Russian people create a socially just economic society.

The Soviet Union was originally established on the pure concept of social justice as its goal. Whatever have been the mistakes of those who corrupted the banner of socialism, it is logical and normal that this should remain the goal of the Russian people. It is a just goal. It, above all, is God's intention. It cannot be otherwise. It is also the goal of donors who have evolved into a from of socialist capitalism which has already achieved many of the dreams of Soviet Socialism.

The American and Russian people are bonded in solidarity in this principal. We claim no nationalist policy. We claim a planetary brotherhood of resource development, sharing and conservation. If this is also the will of the Russian people, it must make its government reflect that will of the Russian people so the world can see it..

The entire justification for the 70 years of existence of the Soviet Union rests upon the ability of the Russian people to transition the economic system of Russia to the goal originally envisioned by the founders of the Soviet Union. Without such a future of social justice the Russian people lose their past and in fact retrogress to Tsarist serfdom and must begin again from there. That must not happen. The Russian people have been too brave, long-suffering, and heroic to endure again such an evolution.

KNOWING THE ANSWERS

9. Many know these answers, but not enough. That Russians vote for communists is both understandable and irrelevant. They do not as yet understand that no government can give what it does not possess. It is a serious lack of knowledge that allows the Russian people to be exploited without having a normal real government. The Russian people alone can produce what is necessary to support themselves and also to support any government they create. Government's can not create. They spend what has been created by people. When the Russian population demonstrates they have learned this and implement it, the donors and investors will come. When Russian flight capital is willing to spend for technical assistance in Russia to attract investment, then investors will come. When "flight capital" supports my efforts to bring this about, I will come.

LEARNING FROM THE PAST

10. Russian economic transition to a market economy has exhibited all the worst characteristics of primitive late 18th century and early 19th century American capitalism. This primitive capitalism lacked concern for social justice and was predicated upon the need for rugged individualism and survival of the fittest. This was required to struggle against nature. The planet has moved beyond this. It is old economic technology and will wound Mother Russia deeply if it tries to use it. The Russian North, Siberia and Far-East are destined to be developed under a concept of "service" by one man to the other and not by exploitation. The realization of the socialist dream of the founders of the Soviet Union may yet find their fullest expression in this adventure.

That is the great difference in normal economic practice today and that which suited the planet 100 years ago. The strategy Russia is presently using is obsolete. You must by-pass this evolution. It is not necessary to repeat it in your development.

We have much to learn from each other. American culture can learn much from the Russian. Russian economic systems can learn much from America. We both have to be willing.

America, and the world are demonstrating their willingness to be donors to Russia, by the largest program of donations in the history of the world. If it cooperates, Russia can duplicate the wonder of the reconstruction of German and Japan and Taiwan which was accomplished following the destruction of the Great War. I tell you frankly my friend that so far the education of the Russian population has been insufficient to gain from them the support necessary to allow donors to work their full potential. I do not believe those in power actually speak for the Russian people. It is up to the Russian people to change that. It is the most important question facing this planet today.

On this day that Christ was born, let us do something about having His Will become on earth as it is in heaven. We have the power.

S uvajheniem

Pyotr Chiteeri

Dr. Pyotr Johannevich van de Waal-Palms, Sovetnik Pravitelstva CWA, Tovarichestvo Palmsa, Inc. Investment Bankers. Washington, USA

World Wide Web home pages - Palms Portal to Russia & CIS (250Mb) 7000 URL links. U.S.A. Location: http://www.peterpalms.com

Moscow Location: http://alice.ibpm.serpukhov.su/friends/home.html

Dr. Palms articles (in Russian) in on line edition of "Delovoi Yuridicheskii Zhurnal" (Electronic Newspapers Project of http://www.dux.ru/win/enpp/newspapers/blj/arts/blj-3-art-8.html Informational Legal System, St. Petersburg, Russia

END FINIS

>From Dr. Alexei Gorshkoff

January 4, 1996

My dear friend Dr. Palms

Thank you for your e-mail message of Dec 25th. I quite agree with you on the analysis of the situation in Russia. There is a necessity to publicize your views and proposed solutions for this situation and educate the Russian people. I ask you to give me permission to organize publication in "Moscow News", "Segodnja" [Today], "Kommersant" and government monthly magazine "Regiony" [Regions]. I shall use your recommendations in official dialog with embassies in Moscow as well as with the highest government officials, if you find it possible, Dr. Palms, to give me permission to make reference to you.

With Respect

Dr. Alexei Gorshkoff

END - FINIS

To: Dr. Alexsei Gorshkoff

Russian Government Bureau for International Humanitarian Aid and Technical Assistance

121200 Moscow G-200Somolenskaya Sennaya Per. 32/34

Tel 244-28-05 244-35-75

Ref: Your fax of January 4, 1996

Dear Dr. Gorshkoff

In accordance with your request, you have my permission to provide Segodnja, Kommersant, Moscow News and Agrumentiy I Fakti with copies of my e-mail messages for publication and to share them also with MFER and Russian Privatization Center <dpanina@glas.apc.org>, Russian Privatization Gleb Center <news@RPC.glas.apc.org> and the government agencies from which your Bureau receives its competence.

You may of course feel free to discuss my ideas with any embassies of other nations, but in my opinion, this will not be very useful until first the Russian government officially endorses and sponsors the concepts of socially just economic development. The problem is not what other nations will do for Russia. The question is..."What will Russia decide to do for itself that will permit the existing assistance of other nations to be used in an economically productive manner in Russian industry?".

I think the Russian people will be convinced, not by words but, by concrete action. There is too much talk, study and consulting and not enough concrete action. Economic policies must be brought into conformity with economic life of the population so the population can support itself and the government.

THE UNITED STATES GOVERNMENT

At the same time that you are asking me for my advice about Russian Economic Development policies and possibilities, the highest level of the U.S. Government is asking me also for advice about this same question.

Yesterday I replied to the questions of the U.S. Government and sent them an opinion, which I think it will be useful to share with you. Since I have not asked permission of the U.S. government, I have removed the identity of the official and his government agency, which reports directly to the Congress of the United States. If I shall receive an official request from the Russian government to act as interlocutor for them about these questions, then it will become appropriate for me to express that interest to the U.S. Government and explore a dialog and dialectic about these questions which are very important for Russia and in which the United States sincerely wishes to be of assistance. I think to have an Investment Banker's knowledge present is important for both governments since this is work for industrial managers, not politicians.

Here are the opinions I expressed to the U.S. Government.

>From palms@PeterPalms.comThu Jan 4 20:07:29 1996

Date: Thu, 4 Jan 1996 20:06:32 -0800 (PST)

From: "Dr. Pyotr Johannevich van de Waal-Palms, American_Bank, USA" <palms@PeterPalms.com>

To: .gov

Subject: Technical Assistance - Russia

On Fri, 1 Dec 1995 .gov wrote:

Dr. Palms,

Good morning. My name is ....... I am a senior evaluator at

the U.S. ..........................., working in the National Security and International Relations Division, International Affairs Issues Group. I am currently in-charge of a review of

U.S. anti-crime assistance to the Newly Independent States. We are reviewing the scope of the crime problem, its impact on political and economic reforms, effectiveness of U.S. assistance, and potential improvements.

My colleague, ............, passed on your address and e-mails on the issue. If you have specific examples of crime and corruption impacting businesses in the NIS, we would be interested as part of on-going investigation. In addition, we would be interested in any view-points you have on the scope of the problem, and the effectiveness of U.S. assistance and possible improvements.

I look forward to hearing from you. Thanks for you interest and efforts to inform us. You can reach me at ..................gov

Best Regards, ........................

Dear Mr......................

If you want the population to be anti-crime you have to protect them from criminal activity which has been made lawful and empower them to achieve lawful reward.

HEREIN LIES THE SOLUTION

Denying crime access to a reward, is only possible if the normal mechanisms of government are not used in support of transfer of money from the honest to the dishonest. Productive action has to be made both lawful and rewarding.

I am not a politician and can permit myself the liberty to speak undiplomatically. You will know how best to cloak my remarks.

The impact of crime upon the economy has gone beyond the limits of a functioning economy. Tax compliance is below 50%. There is at present no "moral capital". In a country where capital, en masse, acts unlawfully, It is impossible to identify or isolate a crime segment from the general economy or population and its practices. The guarantees of Russia at the highest level of banking and government are unacceptable in world commerce. The type of crime we speak of here, comes with a system of government unprecedented in history. It is caught in time between the past and the future.

The Baltics are the largest exporters in Europe of commodities which they do not produce domestically and do not buy elsewhere. Yet the world purchases them. We all know it is property from Russia. Is fencing by nations nobler than fencing by burglars? How do we convince Russians that crime is counter-productive?

All economic indicators are continuing to decline while exports increase, indicating mass exploitation of the population by a minority in power. Life expectancy is down dramatically. Birth rates are negative. Child mortality is abnormally high. Environmental impact on health is beyond control. The disintegration which caused Gorbachev to accept dissolution has accelerated, since the demise of the Soviet Union.

The contradictions called for in maintaining political relations while addressing international crime issues such as drug trade and money laundering through Russia, are challenging. It is impossible to differentiate between the lawful and criminal elements in Russia, only between power and lack of it.

Where there is no national will, 'teaching how to' cannot produce meaningful results. The basic issue of crime control is controlling access to unlawful money and protecting lawful possession. Lawful personal and private property cannot be protected as long as the exchange rates are used as a mechanism of exploitation and 'laws' exploit the rightful owners. In such a place, unlawful money becomes the sole option for reward.

Laws are useful in the hands of lawful men. We know the Russian proclivity from 70 years of negotiations and 7 years of experimentation with a "new approach". While we may honor self-determination we need not misname it competent or representative of its constituents. A similar problem existing in post-war Nazi Germany, but the people were empowered to reform. Once the system supported reform, the ethics of the people conformed to that support. In Russia that is not yet the case.

At lower levels there is a level of sincerity that can be construed as helpful to international crime control interests, while yet injurious to the domestic population. The general public has no evil intent. It simply knows no better from bad example. That can be modified once a system supports modification.

Each Crime control project is a chess game which must be void of basic Western assumptions, if it is to be effective. Thus far, only in the sense of our long term political and military objectives, can the judgment of naive be withheld.

Given this system of immoral laws, laws, we said to Nazi Germany, one has the obligation to disobey, the effectiveness of U.S. assistance in crime prevention is best achieved by focusing our attention on minimizing the effect outside, rather than inside, Russia's borders and on supporting activity inside its borders which supports those priorities.

The best strategy for the long term interests of the U.S is to carefully focus our resources on situations where we can measure and control results, without reliance on third party assessment and reporting, and where we can create economic incentive for attaining milestones of performance, by those third party law enforcement agencies that implement such policy within Russia. We must also insist on the concurrent creation of economic policies and regulations that reward productive action by society as a whole.

It would therefore be useful to acknowledge the relationship between crime and the absence of rewarding economic policies and regulations. How else can we hope to have the population come to think of itself as opposed to crime?

In this regard our initiatives should focus upon:

1. Provide the minimum economic aid consistent with continued reduction of military threat.

2. Recommend the use of the military as a "Sea-bees" type engineering corps and police corps, both adequately paid. EBRD infrastructure financing should go to this military construction corps. Put the Army in charge and give it a mission, a purpose, and a wage. Give it an existence outside the Russian national budget. Police this activity and keep it crime free.

3. Convert military production to construction equipment production under military supervision. Keep it crime free.

4. Propose assumption of customs duties by an entity other than Russian customs with Russian customs as "observers". Keep it crime free.

5. Close the exploitation drains by re-connecting GDP back into the economy. That can be accomplished by requiring some form of self-help, boot-strapping, barn raising participation by regions through export, that would match grants of aid. (Currently 1% of the population are

billionaires while the population begs for aid and is unable to work.) That would channel resources into the economy. It would eliminate the alliance between the communities and law enforcement officials for unlawful conduct and give them an alternative. It would provide an economic incentive to find and close the drains on their disappearing resources, in order to receive matching economic aid for real self-help programs. It makes economic partners of the communities with their law enforcement officials for lawful conduct that the system supports.

If the officially sanctioned flight capital drain isn't cut off, no amount of aid can turn the tide. At present someone takes all the money and leaves to other governments the support of the population's "emergency" needs for survival. Put Russia on an export binge instead of a consumption binge. The parasite is destroying the host.

6. Decentralization is the only solution for reverse transfer payments. In the absence of reasonable laws, require exemptions from economic laws for matching programs. Create a form of "Free Trade Zone" on a company by company basis using the premise that employment generated will reduce the governments demand for social subsistence programs. Treat them as model programs. Make productive action lawful and rewarding.

7. Redirect USAID programs away from U.S. professional consultants into the hands of U.S. individual entrepreneurs with hands-on work experience. An American entrepreneur co-investor will conserve your money while he conserves his own. He supports our government and knows how to make money. Forget advice. Just let him show the Russian population how to do it.

Look at your own evaluations.

http://ssdc.ucsd.edu/cgi-bin/SFgpo?waisdoc+1&4=wais.access.gpo.gov;gao /TEXT/196336/3=)%201963360%20/diska/wais/data/gao/ns95156.txt;

and GAO/NSIAD-96-16 Dec 15, 1995 located in the same general area as the preceding document

8. Unless Russian capital is engaged productively (export profits), domestic GDP can't be turned around. That can only happen piggy-back to American entrepreneurs co-producing this GDP.

In post World War II currency controls were utilized to keep capital at home and reconstruct. In this manner they served a constructive economic purpose. In Russia it is used to maintain a "company store" through income reverse re-distribution from the poor to the rich. The only way to reverse that mechanism is to have market exchange rates penalize the printing presses. Present fiscal policy and economic regulations combine in Russia to control incomes and allocate the difference, between subsistence wages and world market prices of production, to the elite. Flight capital, estimated at $250 billion, negates all incoming aid. The failure to control flight capital removes any justification for controlling exchange rates and erodes support for a lawful society. The current exchange rate is at least twice what it ought to be. By subsidizing basic (very basic) food requirements the population is maintained, while its 'above-subsistence level' production is siphoned off. The net effect is continued economic decline for 90% of the population, which has experienced a major decline in living standards since 1989. They have not hit bottom yet, and can't recover without change.

Russia has always been poor. Now a different kind of 'redistribution' is eroding whatever hard fought for progress may have been achieved. You won't be able to combat crime without the participation of the Russian people. They will require concurrent attention to an alternative.

Once again, ff you want the population to be anti-crime you have to protect them from criminal activity which has been made lawful and empower them to achieve lawful reward.

Dr. Peter J. Palms, IV

President

Palms & Company, Inc., Investment Bankers

Tel 1 (206) 828-6774

E-mail <palms@PeterPalms.com>

http://www.peterpalms.com

My dear Dr. Gorshkoff

As you can see, the problem is not lack of will to help but lack of conditions in Russia that would permit the help to produce concrete results. Present economic policies prevent technical assistance from leading to useful change and investment. These policies also contribute to the crime problem.

There are several reasons for this.

Something remarkable has happened to the world in the fast 50 years which requires that Russia take an enormous leap of faith into the 21st century. Faith is required because, if it relies, as it always has, upon evolution to acquire the new knowledge about how economies function, Russia will run out of time.

1. A GLOBAL ECONOMY HAS REPLACED NATIONAL ECONOMIES

Dr Lucas recently received the Nobel prize for demonstrating that government fiscal and monetary policy has little effect on the economy.

National borders have become obsolete in economic terms. People now act as citizens of an international movement and only act secondly as citizens of a specific nation, and then only in the sense of an affiliation with organizations of populations that share a global philosophy.

So economic policies which are not beneficial to individual productivity, but instead place priority upon achieving government "monetary and fiscal policy national interest" goals, do not work. This is explained in more detail in my essay "Russia's Place in the Global Economy", which I am sending to you separately.

2. A NEW GLOBAL 'CONSCIOUS EVOLUTION' IS DEVELOPING

Market economies have evolved a deep concern for social justice and the environment. The reasons for this are explained in a separate thesis which I am sending you entitles "Where are we Going".

3. We have discovered that Individual people determine national economic welfare. But it goes further than that. We have learned that "expectations" of individuals affect the economy more than their actions and create economic experience and all other experience.

The scientific method assumed that the universe always operated in a predictable manner because for a long time that was all that could be proven. Events without causal relationship were said to occur by chance. Then came quantum mechanics and the findings of Einstein. The whole of Einstein s's work was to show that what we perceive as hard matter is mostly empty space with a pattern of energy running through it. What quantum physics has shown is that when we look at patterns of energy, the act of observation itself can alter results, as if these elementary particles are influenced by what the experimenter expects. In other words the basic stuff of the universe is looking like pure energy that is malleable to human intentions and expectations that defies previous models of the universe, as though our expectations itself causes our energy to flow out into the world and effect our energy systems.

Therefore individual "feeling", "intentions", and "expectations" are of great importance, as far as Russia is concerned. Negative beliefs and expectations of the population are actually self-fulfilling. The significance of this is further explained in my essay "How To Get What you Want". I am sending this to you in a separate message.

WHERE THIS ALL LEADS TO

The present collaboration between Russia and the United States is leading us to the culmination of the integration of this global yearning for a socially just society, built upon individual productivity. It is evident that this collaboration since 1990 has been voluntary and natural, fed by man's spiritual hunger to love.

At this moment in time is it obsolete to think in terms of "nationalism", "defense" and "scarcity". Patriotism has become a cross-boarder concept. Service to one's country is no longer performed in one's country, but wherever global demands call. Security lies in trust in those, who by their actions have earned our respect, and in the will of God which lies in each of us and is actually the same as our own free will. That recognition is dawning. We are beginning to see there is a better way.

This is an enormous global change which goes far beyond Russia's catching up economically. It means Russia has to catch up morally and spiritually.

For this reality to catapult rather than crawl forward requires only that Russia relinquish it outdated mind-set and think in terms of what is best for our new global society. There are simply no real national interests of any nation which conflict with global interests. Super Powers have become simply economic powers, with responsibility to recognize global interests as their own. Moral Powers are becoming the great equal allies in this process. Russia inevitably will become both when it becomes just. By its own spiritual and moral integrity Russia must must become a CATALYST that LEADS and INSPIRES others, so that together we may take the final steps to fulfillment of the global dream of what we might become.

If this is to occur, there is no variant possible other than Russia must BELIEVE in that future through an act of informed faith and act accordingly. Negotiation must give way to giving its allies the "benefit -of-the-doubt".

The actions of the planet towards Russia during the past five years have demonstrated that if Russia progresses in mind-set from "a recipient of change" to "a positive catalyst for change" it will have nothing but allies. If Russia builds its "moral capital" so that its WORD is better than money, its problems will disappear. Russia has only to change its mind to change its experience. Can you imagine a Russia, whose actions are so transparent and whose word is given and kept with such impeccable honor that the world rushes to support every action Russia undertakes to reach its economic potential? What could then hinder Russia in its progress? Russia is in fact the only logical place for the planet to advance its development. Russ ought to play the leading role in the progress of this planet in the 21st Century.

The planet offers Russia its knowledge and resources for this process because Russia's the logical choice for the next step. But with that function comes great responsibility. The planet continues to hunger for great Russian leaders that will share this vision and lead their population out of the early chaos of new found freedom into an enlightened awareness of their potential. The energy of this planet already recognizes this reality and it is time Russia does also. Russia has yet to sense the enormous changes that are in store for it, and which ultimately are inevitable. Russia, if it chooses to, can become an idea whose time has come. Thus far, the degree to which this realization has dawned, is disappointing. The old ways die hard. Yet imagine how simple it really could be. Russia has only to change her mind.

Three supporting documents mentioned in the above communication:

To: Dr. Alexsei Gorshkoff

Russian Government Bureau for International Humanitarian Aid and Technical Assistance

121200 Moscow G-200Somolenskaya Sennaya Per. 32/34

Tel 244-28-05 244-35-75

Ref: Your fax of January 4, 1996

So economic policies which are not beneficial to individual productivity,

but instead place priority upon achieving government "monetary and fiscal policy national interest" goals, do not work. This is explained in more detail in my essay "Russia's Place in the Global Economy", which I am sending to you separately.

RUSSIA'S PLACE IN THE GLOBAL ECONOMY

Dr. Peter Johannevich van de Waal-Palms

Email palms@PeterPalms.com

The global economy has been brought about through innovation, technology and de-regulation. To the extent the government prints more Rubles than the equivalent of the hard currencies earned on exports, it will lower the real exchange rate value of the Ruble. In effect the government makes itself a forced partner of anyone with Rubles, whenever it prints rubles for which there was no corresponding production of goods. By laws and policies it transfer this money from the poor to the rich. Printing Rubles is the same thing as collecting a tax. But it is a tax on possession of money not production of money and is therefore parasitical.

If a country runs a current account deficit it needs to finance it with a capital account "surplus" (i.e. inflow). If it has a current account surplus, it must have a corresponding capital account "deficit" (i.e. outflow). Comparing 1979-81 with 1985-88 West Germany's capital balance moved from an inflow of $8 billion to an outflow of $40 billion. Japan's from an inflow of $5 billion to an outflow of $75 billion, and America's from an outflow of $2 billion to an inflow of $129 billion. But this yardstick is hardly of any use: it is inaccurate and misleading. A balance of payments yardstick for capital flows gives a misleading impression because they show net rather then gross flows of capital. In 1980 total world bank cross border and foreign currency lending was $324 billion. By 1991 it was $7.5 trillion. The combined GDP (Gross Domestic Product) of the 24 industrial countries in 1980 was $7.6 trillion; in 1991 it was $17.1 trillion. So during the past ten years bank lending has risen from 4% of GDP (Gross Domestic Product) of these 24 nations to 44%. From 1970 to 1988 the ownership of American bonds by foreigners increased from 7% to 17% and for Germany from 5% to 34%. Turnover in foreign exchange is now $900 billion each day. There are now 35,000 trans-national companies with 147,000 foreign affiliates. Finance has become totally global.

History shows that the countries whose governments do not involve themselves in business and have no regulations about business, get the most investment. Russian budget "investments" are not investments at all but subsidies. They is no substitute for real capital. Elimination of regulations about business (Freedom) is what develops economies. Currency risk is the greatest deterrent to investment. In an international economic system of global integration, differences between interest rates precisely match the expected changes in the relevant exchange rates. If a one year dollar assets yields 5% and a one year Ruble asset yields 600%, investors must expect the dollar to appreciate 595% against the Ruble over the next 12 months.

It is more difficult to steer economies with Monetary policy and fiscal policy when capital flows freely in a global economy. Financial interdependence has neutered government economic policy makers. Monetarists believe that all you have to do to control inflation is control the supply of money. The "quantity equation" of monetarists says that the supply of money in circulation multiplied by the number of times it turns over in the economy each year must equal the price level, multiplied by the amount of output produced. Under these conditions slowing the growth of money will slow the growth of demand. The events of the 1980's have obliged us to disregard this theory. It has however been accepted that output is driven by supply-side factors and not by demand. For monetarism to succeed it must be possible for the government to control the supply of money and there must be a stable relationship between the amount of money and the amount of demand in the economy. Due to financial innovation and the expansion of global finance neither of these conditions was met in the big industrial economies in the 1980's. Raising interest rates no longer controls the money supply. Domestic interest rate policy is undermined in a global economy. Higher interest rates increase exchange rates. If governments chose to limit exchange rate fluctuation they cannot increase interest rates. The truth is that there is no longer any such thing as money in the historic sense. Charles Goodhart proclaimed the following law. "Any statistical regularity breaks down once pressure is placed upon it for control purposes". Governments change the way an economy works when they try to act upon it (control it). In a time of rapid innovation, expanding cross-border flows of capital, diminishing control through regulation, and the creation of new borders, the opportunities for statistical regularities to break down in unforeseen ways are multiplied many times over. Loosening fiscal policy (budget deficits) together with tightening monetary policies (currency exchange controls, higher taxes, business regulation) create high interest rates. Russian policy has driven $260 billion in flight capital out of Russia in the past five years negating the effect of all foreign investment.

International capital has played a big role in supplying the needs of the American government. America's account balance worsened from a surplus of $1 billion in 1980 to a deficit of $160 billion in 1987.- the mirror image of the country's inflows of capital. If capital controls had been in place, America would have had to finance its fiscal deficit domestically. That would have required interests rates to rise significantly. If the deficit had been financed by printing money, as Russia has done in 1991-1996, rising inflation would have resulted. Without open borders to capital and a free market economy absent of government regulation of business, interests rates, or exchange rates, the choice facing Russia is the same. Since Russia has limited borrowing credit abroad it cannot be irresponsible in spending or it will inflate the Ruble. That is a useful reminder. The ability to borrow money can be harmful to an economy. Russia can follow the example of Baltic currencies or those of The Ukraine.

The greatest opportunity for Russian economic recovery is to eliminate all rules and regulations and allow business the opportunity to expand GDP (Gross Domestic Product) and thereby pay more to the government at lower rates of taxation. This will permit the government to spend more of this revenue on social services and invest in expansion of future production by providing credit to industry at affordable interest rates. To survive through the transition period it will be necessary to substitute "compensatory finance" for printing of currency. It is also necessary to repay debt by transferring ownership of industry.

The market is self disciplining with punishment (bankruptcy) for failure. This is much preferred over government regulation by fiscal policy. Open capital markets lets business men pass a vote of no confidence in the government by moving money abroad. Such exercise of discipline by the market over government is the best self correcting economic policy. The threat of capital flight is a powerful sanction on the government and assures efficiency. It vetoes unaffordable programs and establishes priorities. It delays purchases until the purchase price can be earned by producing it. Is the market vicious, frightening and unfair? So far those Governments who live by it have survived and reached the highest standard of social services for their citizens. America, which has increased its capital inflow to compensate for its trade imbalance, is surviving on trust that it will not start the printing presses and inflate its currency, thereby settling its debts by inflating them away. America continues to attract capital because its creditors trust it not to inflate. Will Russia inflate? Currency appreciation continues to be a reward that investors expect to receive from dollar assets at low interest rates. Does Russia have the courage to join the group of market economy nations. Do its leaders have the vision to take the people there by refusing to finance through printing money and rising inflation? That only Russia can answer. Thus far the answer has been wrong. The ruble has dropped to R4800 =$1.00 from R40 =$1.00 on 1990.

The availability of overseas financing has altered the character of Russia's fiscal policy options. Budget-making is no longer simple. International flows of capital respond to changes in monetary policy and complicate the task of economic management by effecting the exchange rate. International flows of capital also respond to fiscal policy. The more open the Russian economy becomes, the more sensitive it will be to changes in interest and exchange rates. Unsurprisingly the result depends upon the government attitude towards exchange rates. Russian policy makers have to choose between monetary policy (strong under floating rates, ineffective under fixed) or fiscal policy (weak under floating rates, strong under fixed). Preferred monetary policy, chosen with domestic inflation in mind, most likely will not conform to the preferred exchange rate, chosen with international competitiveness in mind. Often the two will conflict and one will have to go. Frequently the exchange rate must go to where the interest rate sends it. The notion that the exchange rate can be used to preserve competitiveness, even as monetary policy is fighting inflation, belongs to an earlier era. - to a time when current account imbalances, not interest-rate differentials, drove currencies . The expansion of global finance has tied money policy and exchange-rate policy inextricably together. So much so that shifts in competitiveness (as expressed in changes in current account balances) now have no detectable effect on exchange rates at at all. It will be some time before economic policy and the new global market for capital learn to get along.

A drive towards more tightly regulated domestic markets, if attempted, would fail because financial markets have knitted themselves together and it will take more than the wit of governments to separate them. The country that tries to regulate more tightly will find that it has delivered its financial industry into the hands of foreign competition. Governments must not themselves become a source of financial instability. Budget deficits must be kept small. Central banks must be allowed to go about their work unmolested.

If you give complete freedom to business managers to produce goods and sell them to anyone they will produce more. If you make the tax only one single income tax ON PROFITS AFTER EXPENSES NOT GROSS REVENUES FROM SALES a company can survive and be profitable. In the U.S. that level is about 12% of GDP (Gross Domestic Product). The lower this tax is (not more than 30%) the more taxes in the aggregate the government will actually receive.

The normal world standard is that industry supports the government not that government supports industry. No one can be supported, if nothing is produced. If the government takes money from the people who earn no profit, to support the government, then the government will exhaust the people and the government will go bankrupt.

Everything that is not specifically prohibited should be permitted without asking for permission. Everything that is legal can be done by anyone at any time without any restriction or permission. The purpose of the government is not to give permission but only to prevent actions which are not morally legal.

The market economy cannot be regulated. A market cannot be defined, it can only be measured. If you have rules about the market there is no market. A market has no rules. The freer the market the more taxes the government will receive.

To attract investment you must be willing to export profits. The market does not stop at the borders to Russia. The world is not part of Russia. Russia is part of the world. Free trade on a global basis is economic development. Economic activity within Russian borders is impossible without economic activity outside Russian borders.

Mechanisms must be created to assure the government that it will receive its fair share of profits in the form of a reasonable tax. Russian industry must have complete freedom to use its profits to invest in machinery and production and grow, or to become bankrupt if it cannot earn a profit.

So far Russia has never tried a radical reform. It has not even tried a reform. What government has done is try to support its existence by taxing assets rather than income and redistributing (transferring) money from the poor to the rich and powerful. Government is suffocating Russian business before it can even get started. The result will be the death of the goose that could lay the golden egg. The existing production of Russia is simply inadequate to give the total population a decent living. Production must be increased. Nothing can be gained by sharing what is left. Give a man a fish and he is hungry again the next day. Teach him how to fish and he will support himself. Industry must be left sufficient capital to support itself. If it is not, Government will drag down industry and they will sink together. For production to occur, investment is required. For investment to occur, economic freedom to produce and retain a fair portion of the results of labor is necessary. There is no other way. Government investments are not investments. They are subsidies, obtained from producers and given to non-producers. Such government transfer cannot last. Such rules will keep capital far away from Russia. Look at Taiwan and what it has accomplished in 40 years without any natural resources. The greatest resource of Russia is not what is in the ground but what is in its people. The people will rescue the government if the government has the good sense to permit it.

Industry must make its own decisions on a completely free basis. Government does not have competence in Economic affairs other than to collect a fair tax.

Flight capital must be avoided through fairness and morality.

A Free industry must provide to the government a fair amount of taxes on its profits. The government must guarantee to live within the budget allocated by industry.

Ownership of profits belongs to industry and capital, not to government. Industry has sovereign rights of private property over its profits and capital. Government rights are only for the fair amount of tax on such profits.

Industries which earn no profits should not have to pay any taxes.

Until such civilized norms are observed export license auctions will remain bribes to government for exporting flight capital. Decent housing will be provided only to expatriates. International investors will include in their expectation of return on investment an assessment of risks, the cost of arbitrary blocks on their bank accounts, withdrawal of work permits, sudden legislated increases in their costs, retroactive cancelation of tax moratoriums and incentives and potential imposition of back taxes. Such risks will be added to the cost of their contracts during negotiations.

Why is Russian labor worth more money outside Russia's borders then inside Russia? Why are Russians successful, optimistic, positive, creative, competitive, and even joyous outside their borders, where they miss their home land. They are the same people in both places. Why can't their energies be freed where they are, without a brain drain of the motherland? Why do Westerners, who are successful outside Russia fail inside Russia. They are the same. Could it be that at something within the borders is the problem? If it is not the Russian people, then what and who is it that is causing so much difficulty?

END - FINIS

2nd support document

On Sat, 6 Jan 1996, Dr. Pyotr Johannevich van de Waal-Palms, American_Bank, USA wrote:

To: Dr. Alexsei Gorshkoff

Russian Government Bureau for International Humanitarian Aid and

Technical Assistance

121200 Moscow G-200Somolenskaya Sennaya Per. 32/34

Tel 244-28-05 244-35-75

Ref: Your fax of January 4, 1996

Dear Dr. Gorshkoff

A NEW GLOBAL 'CONSCIOUS EVOLUTION' IS DEVELOPING

Market economies have evolved a deep concern for social justice and the environment. The reasons for this are explained in a separate thesis which I am sending you entitles "Where are we Going".

WHERE WE ARE GOING?

By Dr. Johannevich van de Waal Palms

E-mail <palms@PeterPalms.com>

WWW: ../palcom2s.html

1. There are no coincidences

At present we experience a profound sense of dissatisfaction and restlessness with the way things are. We are looking for more fulfillment. This restlessness is what's behind the "me-first' attitude that has characterized recent decades. Learning how to find such fulfillment occurs when we become conscience of the apparent 'coincidences' in our lives. and discover they are not coincidences. We are discovering that coincidences mean something. This awareness is the first clue to fulfillment.

2. Awareness is Real

We are in the process of structuring a new world view reflecting this new awareness. This idea seems more valid once we see the historical background to our awareness. History is more the evolution of thought than of technology. What people are feeling and thinking is more important than what is happening. At the end of the sixteenth century we became preoccupied with creating a secular and economic security to replace the spiritual security we had previously had, but lost. History shows that for the following 400 years we have been preoccupied with an attempt to define the universe by means of scientific method. We decided to master this place.

Getting those answers has taken longer than expected so we became preoccupied with settling into the world and making ourselves comfortable. We concentrated on using the earth's resources to better our lives. We pushed aside the original question scientific method was supposed to answer. "Why are we Alive?". Working to establish physical comfort grew to feel complete, and of itself a reason to live.

Present dissatisfaction and restlessness results from the fact that we now have accomplishing what we collectively had set out to do. A 400 year old obsession has been completed. The preoccupation is breaking down and we are waking up to something else. To consider our original question. "What's behind life on this planet?" Why are we really here? We have created the means of material security and now we are ready to find out why we have done it.

The scientific method assumed that the universe always operated in a predictable manner because for a long time that was all that could be proven. Events without causal relationship were said to occur by chance. Then came quantum mechanics and the findings of Einstein. The whole of Einsteins's work was to show that what we perceive as hard matter is mostly empty space with a pattern of energy running through it. What quantum physics has shown is that when we look at patterns of energy, the act of observation itself can alter results, as if these elementary particles are influenced by what the experimenter expects. In other words the basic stuff of the universe is looking like pure energy that is malleable to human intentions and expectations. That defies previous models of the universe, as though our expectations itself causes our energy to flow out into the world and effect our energy systems.

3. We are about to discover that the universe is comprised of one dynamic energy which forms the basis of, and radiates outward from, all things including ourselves. Human perception of this energy first begins with a heightened sensitivity to beauty because they are on the same continuum. We can effect others by what we do with the energy that belongs to us and that we can control.

4. We have been cut off from the larger source of this energy. We have always sought to increase this energy by psychologically stealing it from the only part of this energy we have been open to, the part that flows between people. All human conflict is the result of unconscious competition about the shortage of and manipulation of this energy. We are about to discover how to receive our energy from another source.

5. All of the universe is energy and by loving and appreciating it we can draw energy from it at will. Energy brings on coincidences, that is, occurrences beyond chance so that we feel as though we are attaining what destiny is leading us to become. The unconscious evolutionary process is becoming conscious.

6. CONNECTING WITH UNIVERSAL ENERGY

Before we can connect with energy on a constant basis we must pass one more hurdle, we must face up to the particular way we have sought to control others to acquire the energy that flows between people and switch to the alternative energy source which exists. We must also wake up to who we really are. Then we naturally connect to the beauty surrounding us and breath in its energy. Love is a background emotion that exists when one is connected to the energy available in the universe. Love is a check on energy absorption. The words you have habitually willed through your head in an attempt to logically control events stop when you connect to universal energy. Your intuitions feel different, they are the conscious engagement of evolution to start evolution flowing to produce the coincidences which are the signals to your destiny, which lead you forward. Small questions always pertain to your life quest.

When you attain the state of love nothing or anyone can pull more energy from you than you can replace. In a state of love, the energy flowing out of your creates a current that pulls energy into you at the same rate.

7. RECOGNIZE THE ANSWERS AS THEY ARRIVE

Consciously evolving yourself requires staying alert to every coincidence, every answer the universe provides to you. Let your perception of beauty and iridescence lead your way. Places and people who have answers for you will appear more luminous and attractive. Dreams, thoughts and daydreams come to tell us something about our lives that we are missing. They alert us to be ready for something. When a thought comes, ask why. An observer position on thoughts helps us to release our need to control everything. Halt fear thoughts by willing through the mind another image with good outcome. Soon negative images will be come rare. Take subsequent negative images as a warning to avoid something.

To grasp this one must pull all these insights into one way of being. The Universe provides everything if we get clear and on the path. Thoughts provide clues, and coincidences then occur that provide movement.

All energy flows come through other people. Others will bring answers to us. Not all will have the energy or clarity to reveal what they have for us. We must help them by sending them energy. We do that with love.

8 INTERPERSONAL ENERGY - USING ENERGY IN A NEW WAY - HOW WILL WE ACT

We can increase the frequency of guiding coincidences by uplifting every person that comes into our lives. How we approach others determines how quickly our life questions are answered. Energizing others is the fastest way to receive the message they bring for us. When we appreciate and focus upon a person, we can send them energy, lifting them up, and more energy flows into us from the Universe with which to do it. The recipient of that energy can see what their truth is and more readily give that truth to you. This relationship is entirely different from a co-dependent relationship which steals energy from each other. Real energy projection has no attachment or intention. All participants are just waiting for messages. Remember also the universe is energy, energy that responds to our expectations. People are part of that energy, so when we have a question, the people show up who have the answers. Watch for signs of message carriers, usually members of the same thought groups and interests. Telepathy is perfectly natural. Speak when the energy of others moves to you. Interact consciously. Project energy to others when it is someone else's time to speak.

9. WHERE ARE WE GOING - HOW HUMAN CULTURE WILL CHANGE

Bringing out the best in others rather than having power over them, is a posture the entire human race will eventually adopt. Think of how everyone's energy and pace of evolution will increase at that point. How this will change human culture.

Forests will go un-cut so they can build energy. Humans will live typically among 500 year old trees. Foodstuffs, clothing and transportation will be automated. Our needs will be met without the exchange of currency. Guided by their intuitions everyone will know precisely what to do and when to do it, and this will fit harmoniously with the actions of others. No one will consume excessively because we will have let go of the need to possess and to control for security. In the next millennium, life will become about something else. Our sense of purpose will be satisfied by the thrill of our own conscious evolution by the elation of receiving intuitions and then watching closely as our destinies unfold. Until now many visionaries have spoken of this. Marx spoke of it. Now finally it is about to happen because our obsession with control has ended.

We're here on this planet not to build personal empires of control, but to evolve. If we are correctly following our intuitive guidance then we will take only what we need. Giving is really a universal principle. When we give, we receive in return because of the way energy interacts in the universe. Remember when we project energy into someone else, this creates a void in ourselves which, if we are connected, fills up again. Money works exactly the same way. Once we begin to give constantly, we will always have more coming in than we could possibly give away. Our money should go to those who bring us spiritual truth. When people come into our lives at just the right time to give us the answers we need, we should give them money. As more people engage in the spiritual economy we will ease out of the occupations which limit us and we will then begin a real shift into the culture of the next millennium.

To understand this we have to visualize the next millennium the way we looked at the last one. The early signs of change will be a dramatic movement of individuals from one occupation to another. There will be an automation of the production of goods. This will free time for other endeavors. The truth we have to tell and things we have to do are too unique to fit within a usual job setting. Incomes will remain stable because people will give money to those who provide insights. Money works the same way as energy. Interaction will become our new economic orientation. Automation would free us to expand what is already the information age.

The important difference now is that we understand where we are going. Before we could not release our fear of scarcity and our need for control. We could not release it because we had no view of life that served as an alternative. Now we do!

All of human history has prepared us to achieve conscious evolution. We can now increase our energy and experience the coincidences consciously. This carries evolution onward at a faster pace lifting our vibrations higher to the ultimate process that living is all about, creating our collective "Will of God" on Earth and opening ourselves up to a Heaven that is already before us. We will literally walk into heaven in our same present form.

Happy journey.

END - FINIS

3rd supporting document

On Sat, 6 Jan 1996, Dr. Pyotr Johannevich van de Waal-Palms, American_Bank, USA wrote: To: Dr. Alexsei Gorshkoff

Russian Government Bureau for International Humanitarian Aid and

Technical Assistance

121200 Moscow G-200Somolenskaya Sennaya Per. 32/34

Tel 244-28-05 244-35-75

Ref: Your fax of January 4, 1996

Dear Dr. Gorshkoff

Therefore individual "feeling", "intentions", and "expectations" are of great importance, as far as Russia is concerned. Negative beliefs and expectations of the population are actually self-fulfilling. The significance of this is further explained in my essay "How To Get What you Want". I am sending this to you in a separate message.

Preface:

The importance of the mentality of the Russian population upon economic development is beyond beyond measure. It is the single crucial issue. The mind-set, expectations, intentions and feeling of the Russian people are what determine the condition of the economy. Government's sole ability to contribute to economic development lies in nourishing this mind-set and creating favorable conditions for it. That road lies in eliminating on restraints of freedom of moral economic action and a rule of law that is moral and just.

All economic rebirth begins there.

HOW TO GET WHAT YOU WANT

by Dr. Johannevich van de Waal Palms

E-mail <palms@PeterPalms.com>

The Russian population must become in more deliberate control of their own experiences, which which are entirely determined by their individual thoughts, attitudes and feelings.

If you feel 'lack of' in the 'NOW', your "NOW' will remain unchanged. Just as the artist gains his satisfaction, not from the finished work, but from the doing of the work, you must grasp the concept of 'joyous becoming'. Like the farmer who has planted his seeds, 99% of your creation is complete before you ever see any physical evidence of it.

How much of what you get is controlled by you? All of it. How many of the events that you participate in are as a result of your choices? All of them. How many of the people who are part of your daily experience are brought to you, by you? Every one of them. What percentage of your experience do you have control over? 100%. How many others are currently creating in your experience? None. How many others have responsibility for what is happening to you? Not one other. What part do odds or fate or luck play in your experience? None. Who is the absolute, and only, creator of your experience? YOU ARE!

Recognize that whenever you feel negative emotion, your Inner Being is saying two things to you: First. "There is something that is important to you, here! Second. "You are focused in the opposite direction of what you want"

You exist in a universe where absolute freedom abounds, and you are free. You are so free that every thought that you offer affects your individual experience. There is not greater freedom than that.

You cannot act from a negative viewpoint to fix something that is wrong. If you feel negative you create a negative outcome. It is the feeling offered that attracts its equal.

To stand in your 'NOW' with 'joyous becoming' of what is to come, is infinitely more satisfying than to stand in your 'NOW', looking back, retracing your steps as to how you got where you are. Take responsibility for the experience you are having.

You are here to create. You are not here to discover the path that someone else has laid before you. You are the creator of your path. You are not here as a seeker of those who have discovered truths, that you may now follow in their footsteps. You are truth - seeking a path of joy and growth.

Do not measure progress by the physical trappings you have gathered. The ultimate trophy is JOY. All of the having and all of the doing is for the enhancement of your state of being. Everything that exists is for that sole purpose. It is all for the sake of enhancing the way you FEEL. Your creating is the conscious, deliberate offering of thought with the intent of uplifting the state of being.

Give up negative thought and you will stop creating what you don't want. Change the thought and the evidence will vanish.

Physical action did not bring you to where you are. Your thoughts did! What you defend against becomes your experience. That which you worry about becomes your experience. That which you prepare against becomes your experience. The emotions you feel are guidance from your Inner Being. Nothing is more important than you "feel" good.

Your future is created from your perspective of today. Everything that happens to you, everything, without exception, is by virtue of the combination of intentions and beliefs that you hold.

Action is the way you enjoy what you have made happen through your thought. No amount of action can compensate for inappropriate thought. Use the power of your thought and the power of your expectation to prepare the thing - so that it does not take so much action.

Nothing bad will ever happen to you as you understand that it is only giving thought to those things that attracts them. If you spend a lifetime worrying about something it usually happens to you, sooner or later. Or if you spend a little bit of time intensely focused upon something, you can bring it about - good or bad.

You are in the very best position that you will ever be, of knowing what you do want when you are feeling strong emotion of what you don't want.

Seek joy and all other things will be inspired from that place.

Dr. Peter J. Palms, IV

President

Palms & Company, Inc., Investment Bankers

Tel 1 (206) 828-6774

E-mail <palms@PeterPalms.com>

http://www.peterpalms.com

END -FINIS

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Dr. Peter J. Palms, IV

President

Palms & Company, Inc., Investment Bankers

Tel 1 (206) 828-6774

E-mail <palms@PeterPalms.com>

http://www.peterpalms.com

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Pyotr Chiteeri

Palms & Company, Inc., Investment Bankers, USA. <palms@PeterPalms.com> World Wide Web: http://www.peterpalms.com

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