More on Yuschenko's son

More on Yuschenko’s son.

Even if the Orange Revolution has since turned red (As in Soviet red) preserving its nostalgic remembrance means that it requires safeguarding. This, of course, is obviously why the Orange brand was quietly given to the playboy teenage son of President Yushchenko for safekeeping:

"…Local media said the revolutionary slogan 'Tak!' (Yes) and a downward-facing horseshoe symbol were now registered trademarks owned by [Yushchenko's] 19-year-old son, Andriy.

"The President's eldest son, Andriy has been under media scrutiny after the internet newspaper Ukrainska Pravda publicized his high-stepping lifestyle. "Andriy, a university student, says he has a part-time job that enables him to rent a BMW and a spacious Kiev city centre flat, pay for a personal bodyguard and hang out in chic restaurants, nightclubs and casinos."

Kommersant newspaper adds: "…the Orange theme is widely used till now and Orange goods cost pretty [large amount of] money. For example Orange flag with slogan 'Tak!' costs from 5 to 20 UAH ($1-4) – it is 10% of [the] average Ukrainian pension. So, if an old man decides to present ten [of] his old friends with such flags he must spend all his monthly income given by the state…

Then the usual about how much the brands are worth. (Millions of course.) And then

While the analogy is not exactly precise, there is something to be said here. Ukraine has developed the worst characteristics of America – or at least tiny slivers of its elite have. In 2005, Revolution Industry has become so professionalized that nothing is allowed to be forgotten: the anticipated future profits of branding yesterday's uprisings are earmarked for a sort of trust fund, so that the president's teenage son can enjoy a life of luxury far beyond that of the average Ukrainian, while simultaneously proliferating a legacy that never was.

But why should they complain? After all, like the article said, they can enjoy their civic right to patriotic pride, just by paying their meager pension to feel the special joy that only orange revolutionary souvenirs can bring. After all, this was a revolution of the people. I don't know how the fruit mongers are doing, but chances are among all the problems facing Ukrainians, scurvy isn't one.

Very clever that. My take:

Signing over the brands to the son.

This is suspicious. I have posted about it before. But let’s look at this a little differently. What if it had been reported that the President had created a foundation to protect the symbols of the revolution and had put his son in charge of that foundation? This sort of thing happens all the time in the West, family members putting other family members in charge of foundations to take care of some charitable something or other. Would that sound suspicious? It is nepotism but a nepotism that is expected. I just found out the other day, for instance, that the wife of Christopher Reeve is the head of the foundation created to further research into paralysis. It happens all the time and no one blinks at it. Seems even kind of noble, the family member stepping in to further the legacy.

I can hear the loud voice now, “But there is no foundation here. That’s the difference.” And that is true but misunderstands the problems here in Ukraine. Yuschenko signed over the rights to his son and no foundation was involved. But that is just the sort of lack of connecting of the dots that is so frequent here and maddening to those trying to make some sense of it. Formalities are not necessarily the first thing on people’s minds here when they look to do things. One of the big reasons is that the courts haven’t really meant much of anything-- the rule of law argument. (Ever noticed that the judges in Ukraine sit at a desk rather than on the bench? It has been more a bureaucratic job, getting done what the people who have power want done.) The people have had to depend on players in government with power to get things done, in order to get things done. That means graft and bribes and corruption but it also has meant a kind of personalized sort of justice. The point is that personal contacts and relationships have been more important than the legal niceties.

So it is not unreasonable to suspect that Yuschenko signed over these brands to his son personally for him to make sure that the symbols of the revolution were safeguarded by him personally. A father giving his son some responsibility in helping to safeguard what was in part his legacy.

This makes more sense to me because of

The brands problem

He makes a lot here about the worth of the brands and puts it in the millions. I tell people who want my help putting together a business plan that it is easy to add zeros to any figure. The problem is getting those zeros to match what is actually possible.

In the West, those sums would be the real value of the intellectual property rights in those brands. But Ukraine is not the West. That value in the West is really a function of enforcement more than it is anything else. In Ukraine, there is no such enforcement. A couple of years ago, Microsoft made a big announcement that it had reached an agreement with the pirates in Ukraine regarding its software. Microsoft would grant them a license to sell their software at a reduced rate.

Before that announcement, you could buy a copy of Windows for about $2.50. After that announcement, I went to the local pirate bazaar to check to see how much a copy would cost. I found that you could buy a copy of Windows for $2.50. It was the same price; there had been no change. The point is that what Microsoft had done resulted in nothing changing. Pirated copies of Windows were still being sold. Microsoft stopped nothing.

The same thing still holds true today. The penalties for selling pirated software have been increased in Ukraine following all that push for WTO friendly legislation here. Has that stop the pirates from selling? No, sell it they do. I haven’t checked prices yet but I suspect they haven’t changed..

What is the problem? E-N-F-O-R-C-E-M-E-N-T, enforcement. You can have all the laws on the books you want about things but if they won’t be enforced it is all dead letter.

One reason for this is the same problem--rule of law. But what under girds the rule of law problem is a cultural apathy toward intellectual property rights. The feeling tends to be, If I have a copy, everyone can have a copy. And that is about what happens.

I don’t know of any company here that has a department dealing with IP issues or anyone in a company dealing with them, other than Western companies. It’s just not an issue. This means that when a company here looks to use a symbol—in this case a symbol used very publicly and openly as part of a people’s revolt—they are not all that concerned (read: “not concerned at all”) with determining who the rights belong to. Of course, Yuschenko’s son could have found out that a company is using the symbol and made a demand for a royalty payment. That is a possibility. But I don’t think they could have done that without some sort of disagreement about it that would have eventually spilled over into the public domain. So it is possible but I think it unlikely.

So why then is the price so high? Supply and demand. What we are finding now which we didn’t find in the past all that much before the revolution is that there are a lot of tourists here now. They came after the revolution even before the lifting of the visa requirement but they are out in force now. And they want a piece of the revolution. That usually means a souvenir. For them, what is high priced for a Ukrainian is nominal or even cheap by European and American standards. So I think the price reflects the market for sales of the stuff; the tourist market. They are willing and able to pay the price for that stuff.

Which leaves the

The part-time job/jobs

So if the money isn’t coming from royalties, where then is it coming from for Yuschenko’s son to live the luxury life he seems to be living? The part-time job/jobs he has is where I think it is coming from. That he could not get the kind of money he is alleged to be throwing around from any kind of job he might get at 19 is true. And none of us would be naive enough to think that he is not getting the money he is supposed to be getting in spite of his being Yuschenko’s son. I think it would be clear that he is getting it because he is. And suspicious minds would say that he is simply getting paid for what others before him in the same situation could provide: access to people in power. It is that facial similarity with the ways of the past that makes this very suspicious and is the driving force behind it. And I think legitimately so.

But there is another, more innocent possibility. In the US, in a lot of companies, as an attempt to make investors less jittery about a risky investment or to give the company, usually fledgling, some instant credibility, high profile people are often recruited to sit on the boards of directors of the company. This is true for even legitimate enterprises. It happens all the time. And that director is usually paid handsomely, has an office he never visits, is often given a car and other perks, at company expense, all for lending a company his name--that is, for doing not much of anything.

I think something like that may be going on here.