Hudson/Sommers: Ukraine: “Go West, Young Man” (or Dr. Strangelove’s Revenge)

By Michael Hudson and Jeffrey Sommers, a distinguished professor at the University of Missouri-Kansas City and an associate professor at the University of Wisconsin-Milwaukee, respectively, who have both advised members of Latvia’s government on alternatives to austerity. Originally published at Truthout.

Ukraine.(Photo: / Flickr)“Let them loot.” That is the demand of the West when its NGO subsidiaries firebomb government buildings, murder policemen and loot the arms depots of military forts. Kiev is the equivalent of Kosovo as a Slavic city-of-origin. Are we seeing a replay? 

What would Dick Cheney (or President Obama for that matter) have done if Russian NGOs sponsored separatist movements in Texas, California or New England? How would US police have reacted against armed revolutionaries seizing the armory and throwing Molotov cocktails and bombs at public buildings, killing police, painting swastikas on Jewish houses and claiming vigilante justice? While this does not characterize all of the Ukrainian protesters, it does reflect a fair number of them. If this is Obama’s “reset” with Russia, he is resetting the Cold War by setting the neocons loose in the former Soviet republics. If there is one thing that the CIA has shown its competence in, it is in setting one ethnic group against the others – Sunni vs Shiite, Kurd against Arab, Persian against them all. When other countries seek to defend a multi-ethnic secular state, the US foreign office has backed the fundamentalists for nearly the past half-century in all cases. This should be the sub-text for reporting on the Ukrainian uprising that seems to have been carefully timed to coincide with Sochi.

Events in Ukraine are provided enough heat to overshadow the conclusion of the Sochi Olympics. Since the USSR’s collapse, the “reset” has been changed many times during our long-running Ukrainian “play,” but the underlying theme remains the same as it has been in the Near East: Play the ethnic card to break the country into pieces if you want to disable government regulatory power and investment. Co-opt a client oligarchy whose opportunities for the West lie in privatizing public resources and selling shares in the rent-extracting companies on Western stock exchanges. Keep your proceeds in the West and fritter it away on trophy real estate, ownership of sports clubs and London or Swiss bank accounts. 

The alternative would be for a strong government to tax away their natural resource rents and use it to subsidize industrial revival. So the path to “peace” is to promote civil warfare, break up countries and concentrate wealth in as few hands as possible so as to channel it to London, New York and other financial centers rather than leaving it to be invested at home. This is how Russia is being turned into a “hewer of wood and drawer of oil and gas for the house of my bond,” to paraphrase the Bible (Joshua: 9:23). “None of you will be freed from being bondservants.”

This is how American protectionists in the mid-19th century described British strategy for industrial and financial supremacy. And now the tables have been turned – not only against Britain (buckling under its own real estate bubble) but against the post-Communist economies that were utterly free of debt and privatized rent-yielding resources 20 years ago.

Rotating oligarchs shift in and out of this scenario, replacing one another in the rolling sequence of “color revolutions.” While Russian and Ukrainian nationalists spar in “Spy vs. Spy” fashion, Ukraine’s economy unravels and its people continue their exodus on an Old Testament scale to the Promised Land of the EU. Following Horace Greeley’s advice of “Go West, young man,” Ukrainians have joined the multitudes of “Polish plumbers” in the UK.

It didn’t have to be this way (and it still doesn’t). The stage was set in the closing stages of the Cold War. George H.W. Bush (the Elder) promised Mikhail Gorbachev that if the Soviets let the Warsaw Pact go and agreed to German reunification, Russia would not have to worry about further expansion of NATO. The United States then reneged by taking the former Warsaw Pact into NATO then moved into the former Soviet territory by absorbing the Baltic states – which, in geopolitical terms, were practically suburbs of St. Petersburg.

It is hard to blame the new entrants for wishing NATO entry, given their past Soviet occupation. This is the cross that Russia has had to bear for a generation, and it will continue to be a basis for the National Endowment for Democracy, the CIA and other “security” agencies to spur ethnic rivalry against Russians. To US neo-Cold Warriors, Stalinist oppression in the Soviet Union is what memories of the Holocaust are to Israel: In good Judeo-Christian tradition, it fans the flame of retaliation, resentment and revenge.

One can hardly blame Russians for feeling betrayed by the United States and NATO for breaking their word. More importantly, they see neocon Eurasionists in the State Department wanting even more. For neo-Cold Warriors the goal is the further breakup of Russia and its Near Abroad to create a neo-liberalized periphery, Baltic-style. Breaking up countries into small units controlled by kleptocrats who see their path to wealth being to privatize public assets and sell ownership shares to the West is the most effective way of preventing government subsidy of industry – and without industry there can be little military threat.

For Russia, this geopolitical game has an existential character. Ukraine looks like a dress rehearsal for separatist movements (much as the United States is sponsoring in China and already had achieved throughout the Near East). For Russia, NATO’s moves into Georgia cut too close to the bone and were repelled. The threat of NATO taking Ukraine represented a thrust into Russia’s geographic heart, the ancestral home where Russia was founded. (This should be read while turning up the volume on Prokofiev’s “Alexander Nevsky.”)

Timing is everything. If there were any time for an opponent of Russia to try to provoke an intemperate move, this was it. The Olympics were supposed to show a positive Russian face to the world, helping heal the old Cold War tensions. So from Mr. Putin’s vantage point, the worst thing that could happen would be a distraction to remind the world of old Soviet-era repression – such as arresting Pussy Riot singers. So of course, this was precisely what the Western press played up. To read The New York Times or The Washington Post, the real sporting event was whether the police would descend on Pussy Riot’s sideshow and could provoke Cossack goons into beating them up on camera.

While there certainly was legitimate protest against former President Viktor Yanukovych’s corrupt government, there was what seems provocation to get policemen (under violent attack from protesters) to defend themselves when they were fired upon by demonstrators brought into Kiev specifically to create a public relations disturbance. 

Meanwhile, the EU seems bent on reprising its earlier eastward expansion of recent decades into the former Warsaw Pact to reap a windfall in exports of consumer goods. This helped alleviate the unemployment resulting from the Maastricht Treaty’s neoliberal fiscal and monetary austerity for the eurozone’s currency union. Yet, Ukraine’s purchasing potential is much lower than that of the countries that bordered Germany and were integrated into EU markets with heavy European subsidy. No Euro-export boom is likely to occur with any likely proposed association agreement. About the only thing the EU can achieve is to ensure a strong enough austerity program gets implemented in order to ensure the holders of Ukrainian bonds gets paid. Instead, the possible damage to Ukrainian markets from poorly executed trade liberalization and non-visa regimes may flood the EU with cheap labor by “Ukrainian plumbers.” But now that Europe’s real estate bubble has burst, where will they plumb? 

So far, the neo-Cold War crossfire has left Ukraine indebted to Russia and the EU. Who will be liable for the 60 billion euros in Ukrainian bonds that Russians hold? Yields on ten-year bonds have just jumped above the 10 percent level (and shorter-term bonds much higher), indicating a general expectation of default. What will Russia charge for the gas it ships through Ukraine? Would a separatist NATO-Western Ukraine be able to buy gas at an equally low price as the Eastern Ukraine? Will Germans freeze in the dark?

When ethnic Ukrainians look to the EU as their savior, they have lost their sense of timing. They are seeing the last vestiges of a “Social Europe” that has been sacrificed on the altar of neoliberalism. Yanukovych had been urged to raise the VAT and tax labor all the more, but he resisted in order to prevent earlier popular unrest. Now that the Ukraine promises to move under Western neoliberal tutelage, the first policies that one can expect are higher taxes on labor and consumers – and an accelerated capital flight out of the country to the Eurozone and Switzerland.

Having suffered a generation under Stalin and his successors, Ukrainians will now be able to compare that to the hand of IMF central planners. Who needs a military thrust when a new round of shock therapy and austerity will do the trick more deftly?

Yanukovych is the kind of kleptocrat that neoliberals promised would enrich the post-Soviet states, except he committed the unforgivable sin of refusing to implement an EU/US-counseled austerity program. The aim is to transfer public wealth into the hands of private individuals who will be steered by the “Invisible Hand” (that of the sponsors of today’s color revolutions) to seek their gains by selling what they have taken to Western investors. Finance is the new mode of warfare, and we are seeing a grab for what military invasions in times past aimed at: land, natural resources and infrastructure monopolies.

Prior to Yanukovych’s overthrow, there was talk of a “reset” as the United States and Russia seemed to be moving toward a mutual accommodation. His departure from the scene places the United States and the EU back in a position of influence and will embolden hardline Eurasionists in the State Department, such as Victoria Nuland.

Meanwhile, the reappearance of Yulia Tymeshenko (who gained stature in jail) represents the return of ethnic Ukrainian oligarchs. They have been promised that they can get even richer by paying foreign bondholders – no doubt with an IMF or ECB destabilization program that will impose deep enough austerity to create an Irish-style Lost Generation. 

There is little likelihood of national economic development. The aim is to empty out the nation’s capital, not create it. There will be no more consideration of Modern Monetary Theory or Land Value Tax alternatives. The US/EU plan is the same neoliberal strategy designed to demilitarize the post-Soviet states by de-industrializing them and driving their population to emigrate. 

“Structural adjustment” (today’s euphemism for austerity) will continue loading down Ukraine with debt, using it as a lever to control its economic policy. Meanwhile, Russia offers debt relief (or at least more loans) without development, because it itself still partially remains under the thrall of neoliberalism.

Russia and Ukraine would benefit from an alternative economic policy based on regional capital investment in economic development. Russia and Ukraine need to halt the capital flight of their oligarchs to offshore banking sites in places such as London and Riga, and instead mobilize their natural resources, real estate and monopoly rents for domestic investment. Such moves would be denounced by the epicenters of “tax dumping” (London and New York). Currently, the IMF/European Central Bank wants supersede post-Soviet governments as their new central planners whose results can only accelerate kleptocratic looting! 

Print Friendly
Tweet about this on Twitter0Digg thisShare on Reddit0Share on StumbleUpon0Share on Facebook0Share on LinkedIn3Share on Google+7Buffer this pageEmail this to someone
This entry was posted in Europe, Guest Post, Russia on by .

About Lambert Strether

Lambert Strether has been blogging, managing online communities, and doing system administration 24/7 since 2003, in Drupal and WordPress. Besides political economy and the political scene, he blogs about rhetoric, software engineering, permaculture, history, literature, local politics, international travel, food, and fixing stuff around the house. The nom de plume “Lambert Strether” comes from Henry James’s The Ambassadors: “Live all you can. It’s a mistake not to.” You can follow him on Twitter at @lambertstrether.


  1. vlade

    my previous attempt didn’t seem to show up, so again:
    Good grief.
    “Yanukovych is the kind of kleptocrat that neoliberals promised would…. “. Hello? Yanukovych was and remains a Russia’s puppet (not to mention a convicted criminal etc. etc., but that’s just how the politicans in ex Soviet block roll). Now, if you put in Timoshenko (who is an oligarch) or even Yuschenko (who is an ex central banker and could qualify as neoliberal), you may show that you actually have a clue, but taken together with the previous post all I can see is Russian apologists.

    Yes, we can understand that Russia’s dreames were shattered by NATO. But so were Wilhelmine Reich by Allies in WW1 and the peace settlement then, and see where that lead the world (the parallels between today’s Russia and Weimar are scary, the main difference being economy, but it’s question whether it’s for better or worse. History may not repeat, but it certainly rhymes).

    I’m not claiming Ukraine is not a mess. It was a mess when I last visited three years ago, and according to people I speak to now it remains a mess, and I can’t see an easy way out. Which incidentally is the reason why most of middle class want in EU, hoping it will be less of a mess (hope springs eternal).

    You talk about NGOs supporting firebombing – well, yes. I have heard (from people on the ground) of the Maidan demonstrator being paid $30 a day to show up (and it’s being blamed on Americans). But then, I have heard (from sources of about the same reliability as the above) that the pro-Russia demonstrators in the East of Ukraine are Russians being bussed in from Wester Russia and being paid about the same (by Russia). Neither side had a hard proof, both claims are believable. If anyone thinks that the people who took over airports in Crimea are anyone but Russia soldiers is being deluded.

    Crimea is also a mess, and whoever “wins” will soon find it a Pyrrhic victory. If it’s Russian, the Crimean Tartars won’t go quietly. If it’s Ukraininan, the ethnic Russians won’t. Crimea has almost no fresh water, and their main source is Ukraine mainland. What happens if they turn the tap off in response to Russia turning the gas tap off? (and it’s easier to deal with gas now that winter is ending than with water).

    There are no good guys on either side, and given the history, the question is whether there could be (and not steamrolled by the bad ones pretty quickly).

    1. vidimi

      no, i don’t see any parallels between russia and weimar germany whatsoever. at best, you can draw parallels between russia today and the young german empire of a century ago, but then what would that make china?

    2. Banger

      Ranting about Russia and all that has nothing to do with the central issues. A mob overthrew a freely elected government through funding from the EU and the USA. Those facts remain even if you eliminate the funding since so many people don’t believe the CIA or intelligence services every overthrow governments using money and bribes–one encounters such fools on other boards.

      But worst you miss the whole thrust of the argument–this is part of a general approach of U.S. post-Cold War I policies throughout the world–whip up ethnic and religious hatreds to divide and conquer. What is so hard about grasping that? Russia has its own game to play trying to keep its ethnic populations from rebelling and its don a credible though brutal job–but is Russia more brutal than the U.S.? I don’t think so. They are both authoritarian states playing the power game and the U.S. and it’s subject states in the EU want to win.

      1. James Levy

        I think that the idea that Russia in 1945 was Wilhelmine Germany circa 1912 (or that Wilhelmine Germany was what the victors painted it to be post-1918) is really misleading. And the Anglo-French entente were hardly babes in the woods before 1914.
        Bottom line is that Ukraine is a dagger pointed at the heart of Russia, while only a cash cow to the US/EU block. When the Ukrainian Nationalists tore up the agreement they had signed to hold early elections less than 24 hours after signing it, they proved that they were no kind of government the Russians could have any faith in. NATO and the Ukrainian Nationalists grossly overplayed their hand, and tried to stick it to Russia on her own border. No Russian government that was not a puppet of the West could ever countenance such an obvious attempt by the Germans and the Americans to weaken Russia and get their own people in power in Kiev. Bottom line, Vlade: the people running Ukraine are going to be puppets of the West or of Russia, because that’s what the Big Boys want. Obama and Putin and the interests they represent want control and domination and weak states have to bend to that or get broken. Not nice, and not what I think is just, but that’s the reality we live it. It was better and safer for Ukraine to stay safely as a buffer within the Russian sphere of influence.

        1. cwaltz

          There are no good choices for the Ukrainian people. They’re pretty much stuck with nothing but bad choices. On one hand they’ve got Russia who really hasn’t poured the money into them that they need to thrive on the other they’ve got the EU promising an influx of cash but pretty much guaranteeing austerity a la Greece(essentially looting Ukraine for anything of value.) Neither hand is an ideal hand.

        2. optimader

          “…they proved that they were no kind of government the Russians could have any faith in…”
          they proved that long before actually. It was an unreliable government for Putin and the Russian mafia, going forward he obviously needs to influence the outcome favorably.
          1.) safe transit of natural gas
          2.) warm water naval port

          Russia is still suffering the hangover of centralized planning which resulted in strategic resources and facilities being regionally located. When the SU exploded it became a ongoing challenge to keep all the dishes spinning on the sticks. Another major issue in play are the regional ethnic histories, much of which is bad history for ethnic Russians. Putin has his hands full.

  2. The Dork of Cork

    The true objective of these post cold war engagements is to create enough refugees so as to maintain the rate of profit in areas which closely orbit the financial capitals.
    This is done by seemingly f£$king up foreign policy objectives.

    For example the recent F$£k Europe comment by a American operative is obviously a deliberate leak so as to create media tension before the big event on the ground.

    I am afraid people are confronted by a monstrous conspiracy.
    The conspiracy is obviously to destroy village & national like cooperation via creating various flux like events.
    Thus people become more and more monetized & atomized and thus more easily controlled by this vast demonic money power.

  3. Paul Tioxon

    In order to help with identifying the Nuland reference and neo-con significance to what the US pushes in the Ukraine, here is an excerpt to corroborate Mr Hudson in his effort point her out in his post Immanuel Wallerstein:

    “Before we proceed with the analysis, let us take a moment to offer generic sympathy to all important people these days. In the last few years, there has been much discussion about the loss of privacy in communications. But this discussion has always been about little people subject to spying by governments, in particular by the U.S. National Security Agency. It seems however that this loss of privacy now extends to people like Ms. Nuland. There is much speculation about exactly who bugged her conversation and made it go viral on YouTube. The point is that poor Ms. Nuland is no longer safe in saying anything – or at least anything that she wouldn’t want the whole world to know.

    Let us take a look at who is Victoria Nuland. She is a surviving member of the neocon clique that surrounded George W. Bush, in whose government she served. Her husband, Robert Kagan, is one of the best-known ideologues of the neocon group. It is an interesting question what she is doing in such a key position in the Department of State of an Obama presidency. The least he and U.S. Secretary of State John Kerry were supposed to do was to remove the neocons from such a role.

    Now, let us recall what exactly was the neocon line on Europe during the Bush days. The then U.S. Secretary of Defense Donald Rumsfeld famously talked of France and Germany as the “old Europe” in contrast to what he saw as the “new Europe” – that is, countries who shared Rumsfeld’s views on the then imminent invasion of Iraq. The new Europe was for Rumsfeld Great Britain especially and east-central Europe, the countries formerly part of the Soviet bloc. Ms. Nuland seems to have the same perception of Europe.

    Let me therefore propose that Ukraine is merely a convenient excuse or proxy for a larger geopolitical division that has nothing whatsoever to do with its internal schism. What haunts the Nulands of this world is not a putative “absorption” of Ukraine by Russia – an eventuality with which she could live. What haunts her and those who share her views is a geopolitical alliance of Germany/France and Russia. The nightmare of a Paris-Berlin-Moscow axis has receded a little bit since its acme in 2003, when U.S. efforts to have the U.N. Security Council endorse the U.S. invasion of Iraq in 2003 were defeated by France and Germany.”

    Here is the youtube link of the phone call by Ms Nuland, who is the US Undersecretary of State for European Affairs, taped by an unknown agency and leaked to the world. She is discussing the behind the scene efforts to manipulate the internal politics of the Ukraine with US Ambassador to the Ukraine, Geoffrey R. Pyatt. It was released on Feb 6th. It clearly shows the highest level of US policy in regards to Ukraine’s immediate political tensions, leading up to what we are seeing the past week.

    1. Banger

      Amen. The neoconservatives were shown the door in 2006 because of the debacle that was Iraq–they migrated over to the Democratic/Wall Street party where they belong and where they came from in the first place.

      The U.S. press utterly ignores the Nuland/Kagan rise to power in the Obama Administration. They like her and call her “Torrey.” More important than what has happened to State is the emergence of neoconservative philosophy in the major editorial offices of all the major “news” outlets. While there was always sympathy to those ideas today those ideas have won the day–why? Yes, because they are spokespeople for the powerful–and if they don’t do that they are fired–but it’s more than that–these editors and senior news people must believe in something to give meaning to their lives. The idea of American Exceptionalism is the key component to this and most American public intellectuals who are allowed to speak in the mainstream and who are responsible for much of the scholarly work in a variety of less read journals subscribe to the American Exceptionalist creed.

      1. James Levy

        Yes, listening to Kerry after Iraq, Panama, Grenada, Chile, Dominican Republic, the Gulf of Tonkin Resolution, Guatemala, and Iran would make any sane person lose their mind. I’m an historian and it’s as if history never happened. Denying the Holocaust will get you deserved censure. Denying the entire above history is A PREREQUISITE TO JOINING THE PUBIC DISCOURSE ON AMERICAN FOREIGN POLICY. Other countries commit crimes. The United States might, possibly, and with all good intentions, make mistakes, maybe.

        Sorry if I’m ranting but I’m genuinely frightened that this could escalate into a nuclear confrontation (this is why I argued that 1914 is not a dead issue; leaders can still take astonishing, dangerous, actions; just hear Kerry intone that “all options are on the table” to know what idiots we are dealing with).

        1. vlade

          “There are no good guys on either side”
          Of course Ukrainians will go either with Russia or US/EU. But to paint Russia as being the good guys in this is just dumb, sorry. There are only bad choiced for Ukraine.

          And I’ll stand by the comparison of Weimar and Russia now (note that I wrote “paralles between Weimar and Russia”, not Wilhelmine Germany pre WW1, before we get too misled). Strong nationalist movement, representing a non-trivial feel that they were/are robbed of their place in the sun by external forces etc. etc.

          1. James Levy

            Vlade, there is no way I am arguing that the Russians are the “good guys.” I am arguing that they have legitimate fears for their security that the Western Powers simply don’t and that they are responding in a predictable manner. The special elections should have been held and the transfer of power been made in a way that balanced everyone’s concerns. The precipitous power grab by the Ukrainian Nationalists was a mistake, and a dangerous one, and calling for military mobilization isn’t going to help them, either.
            The Ukrainian people are suffering because, like the Shiites back in 1991, they were led to believe that Uncle Sam and Europe had their back. The US/EU should have disabused them of any such notion, and let Russia know that after the leaked telephone conversation we were backing off. It’s awful, but it was all predictable and we pay our government to know that and make sure none of this ever came to pass.

            1. vlade

              I actually agree with that. Say the invasion of Finland in 1930s was spurred by failure of negotiations with Finland when USSR wanted to have larger buffer north of then Leningrad, which was a very valid point (and the Russian initial offer to Finland then wasn’t entirely unreasonable). Russia wants to operate its own version of Monroe’s doctrine, and I can’t fault it at this (although I do think they are too paraniod, but again, I can even understand that).

              What I do object to is the way it’s trying to do it (Putin could have Crimea easily if he waited a few weeks). From a very rational point, what they are doing could be the best rational strategy for them (showing the weakness of NATO/US/EU to any minor states, thus potentially forcing them out, testing the boundaries etc. etc.), but I don’t really want to live in a fully Machiavellian world. And what riles me a lot is people who object to that in the US/West but are ready to support other regimes just because they too oppose US/West.

        2. Banger

          James, yours is, as usual one of the few voices with a truly broad perspective here. I rant, you make reasonable points. People here and elsewhere often fail to see that Realpolitik and history did not end in the early 90s with the “defeat” of Communism.

          There are pitched battles today going on inside Washington for power within the foreign policy elite–I’ve seen it up close growing up in a Foreign Service family and also living and working in the DC area for several decades (I escaped by the skin of my teeth). The frightening part is that I believed that the worst of the lot that came in with Bush (the neocons) were in retreat. Libya and the drone wars showed me that the tactics changed but the strategy laid out in the PNAC statements has remained unchanged. There are still people in government that dissent from the neoconservative ascendancy that this crisis seems to indicate is in place–their view is that American interests lie in negotiating deals between the powers that be to make sure stability results and once stability is established there is less reliance on military solutions or subversion of other societies. I worry that these voices may no longer be heeded. Bush heeded them after 2006. Obama has decided to ignore them–though I don’t think he wants to. I’m confused–I don’t know what is going on in Washington–it is becoming more and more opaque. The key person to read to understand what the dominant FP clique thinks, btw, is David Ignatius–he is not a neocon–he just reflects the changing consensus and current mainstream line.

          1. allcoppedout

            You don’t rant Banger, though you might shout sense loudly. This is the age of quiet propaganda lies told in the objective third-person. Part of their scheme is to silence the pain by declaring it ‘rant’.

      2. The Dork of Cork

        Iraq is a debacle only when seen from a narrow nation state perspective
        It in fact has been a dramatic success for global banks,
        It is now a major supplier of Asian oil insuring the continued expansion of the global wage arbitrage scheme.
        Neo – conservatives are by no means nationalists .
        How absurd.
        Nationalists by default embrace Autarky
        Naval / banking powers follow a different path.

        We have however reached a absurdity junction now.
        Genoa , Holland . UK and now USA have no more worlds to trade off.

        1. Lambert Strether Post author

          If the — or at least always one — purpose of the 0.01% Global Trolls is to weaken the State where encountered, Iraq succeeded brilliantly. And so what if they’re spending Other People’s Money?

          1. JTFaraday

            Well, if it were up to the US public, it would turn off the spigot. If it’s neo-con VP Dick Cheney talking, then it’s “deficits don’t matter.”

            1. jonboinAR

              The US public? The US public, from all I’ve ever seen, lacks the attentive staying power to make an informed decision whether to “turn the spigot off” or not. It’s been a complete bread and circuses strategy here in the US by TPTB and so far it’s worked perfectly. I read NC and the links provided all the danged time. I’m barely starting to get a glimmering of what’s going on, blinking at the cave opening, or toward it. I know considerably more about intl affairs and the real economy, at least as I understand it, than anyone I know, bar none (except Carla).

          2. Paul Tioxon

            The purpose of the global elite is not a static standing order or strategy to weaken the state. For 500 years they have collaborated in making strong states. Stronger than what went before. As a result of specific circumstances, specific changing circumstances, a coming together at a point in time, or place or both, a conjuncture of the political economy, a strong state may be most desirable to one of the strongest factions of the global elite. However, only an aspect of the state, serving the needs and policy goals may need the strength to serve their needs. The military and the taxing authority to let other peoples money pay for the desirable, in the minds of the elites, government programs.

            For the elites, the USA must be by necessity the strongest of states, vis a vis other states. And all costs to support this must be paid by hook or by crook, with at least some taxation upon the profits of elites, no matter what Grover Norquist decrees. That does not mean that we have to clean air and water, we don’t, it just means it has to be cleaner than China’s air or water. Not a hard goal to attain. WE are militarily so far ahead of everyone, there is no contest and it would take generations of buildup to catch up with us, all the while we would still be spending. Compound interest is an advantage in the arms race for us in that regard, we just so far outdistance the world collectively and most of the world’s military are firm allies.

            Capitalism is the state and the market working in conjunction to maintain the wealth and power of the global elite. Hegemony is the rotating role of the leading power state, to dominate other states, by getting them to follow their lead in policies, without resorting to military conquest and placing territory under direct political control. Empire conquest by means of violent force of arms results in uniform laws covering all territories. The market can then hardly find the means to resist being placed in service to the state. There is no where to go, beyond the compelling force of the Empire, other than another state, whose territory is protected by great enough force.

            Hegemony solves a lot of problems for the elites, it provides a global order for transnational trade, mobility of capital and other jurisdictions that will not be breached by force of arms. It allows for a strong set of states, the core or G7, to lead the world and dominate in profits taken and policies executed. And it mitigates against the establishment of Empire which would extend laws on a transnational basis, not seen in the international set of the United Nations structure of international law. Russian is playing with this set up, albeit with a relatively insignifcant territory as far as the rest of the world is concerned. It’s not about the people of the Ukraine, just as it’s not about the money, it’s about the principle, for the USA, the EU and the Russian Federation. Putin’s Russian waited until its gas pipelines gave them geo-political leverage. They were not supposed to act out in this way. They were supposed to play a role in the Hegemonic social order and this was not an acceptable action. If Russia can do this, than so can someone else. Well, not really. It is hard to argue the sanctity of Ukrainian sovereignty in the face of a Russian naval base and thousands of Russians living on Ukrainian soil in the Crimea, treaty or no treaty. It’s a military base from a world power, not a shopping center with a hotel/entertainment complex. The 19th century solution of Empire, used tactically in the 21st may be digestible, but not a whole lot more. Russia has made its point, just as we have when we invade another “sovereign” nation. I hope that they don’t bite off more of the Ukraine than they can chew, they just might choke.

    2. Jerome Armstrong

      Yea, has word gotten out as to how this leaked? Seems to have been jumped on by RT quickly, so one could imagine clandestine efforts from Russia for the origin. But it got little airplay to none in the US.

  4. Hugh

    I agree with vlade. The main bone of contention now seems to be how European, Russian, and local kleptocrats will divide up the country. This should not surprise us. How much sympathy have European kleptocrats shown toward their victims among the 99% in every country in Europe from Greece to Germany? Or Russian ones toward theirs?

    1. rkka

      “Or Russian ones toward theirs?”

      The Russian ones have faced limits to their predation.

      Wasn’t voluntary though…

      1. vlade

        Sorry, what you meant to say is that the kleptocrats who weren’t willing to tow Putin’s line faced limits (including jail, something they might now have expected). If in a mafia firefight bad guys get killed, we could be glad that they are offed, but it doesn’t make the other side good by any means.

          1. vlade

            You mean the ruling which said that “the arrest was unlawful”?
            And for the record, the court didn’t rule it wasn’t political process, but it did say that:
            “Claims of political motivation behind prosecution required incontestable proof, which had not been presented,”

            I.e. nothing either way, although they did say the charges were grounded “in reasonable suspicion”.

            I don’t doubt he’s been avoiding taxes, and that he’s an equivalent of a robber baron, but I doubt that he’s the only one. My point is that he’s likely the most inconvenient (as Putin even told BP’s chairman at the time), and used as an object lesson.

  5. rkka

    “but taken together with the previous post all I can see is Russian apologists.”

    “There are no good guys on either side, and given the history, the question is whether there could be ”

    How about the guy who pretty much stopped his country’s gini coefficient increasing in 2003, producing an actual increase in people’s living standards over the past decade?

    Certainly nobody in the West…

    1. vlade

      Eh? Do you mean Kuchma? I’ll give you that he at least was a pragmatist. But then his corruption scandals pushed him closer to Russia so in a way he has his share of responsibility for what we see now. One thing that Western politicians mastered more than others is the art of stealing slowly, but over a longer time. The ex-soviet block ones (and others) are impatient as they know they might not be here the next year so want it all right now, so generate to an extent a self-fulfilling prophecy.

      1. rkka

        Nope! Not much evidence of rising living standards in Ukraine the past decade.

        Or two…

        1. vlade

          Ok, misunderstood. But how much of that in Russia was by Putin and how much of it was by the simple fact that the oil price went up fourfold (twofold on average)? Russian’s budget (which pays for the large state machinery) doubled with the price of oil. When hedgies & banks were reaping it via fake loans in early 2000s, everyone in US was (at that time) benefiting. Does it mean that Clinton/Bush was a great guy?

      2. Massinissa

        Hes talking about Putin, not Kuchma.

        To be fair, Putin also succeeded in getting Russias population increasing again (was negative in the 90s, thanks to neoliberalism…), and im not talking about the Muslims in russia.

        Putin has probably done more good for Russia than bad.

        1. rkka

          “Hes talking about Putin, not Kuchma.”


          The way Ukraine looks now is probably how Russia would look if Putin hadn’t jailed ‘Saint Khodorkovsky of the Gulag’ and made the rest of the oligarchs pay their taxes and limit their predation on Russians.

          And yes, 2013 was the first year since 1991 that births in Russia exceeded deaths.

          The year Putin got the job, deaths exceeded births by 958,000.

      3. Massinissa

        Hes talking about Putin.

        And let me add that Putins economic policies have also made it so the population of ethnic russians (not just russian muslims) are increasing again, as opposed to the 90s when the birth rate declined tremendously.

        Like Putin or not, economically at least (if not socially), Putin has been more good than bad for Russia.

        1. Lafayette

          The reverse is also very likely. Russia has been good for Putin.

          I beg to differ.

          Is what Russia needs an ex-KGP official who still thinks/acts like a KGB-official. Who has rebuilt and maintains a highly centralized direct management of Russia. And one who tolerates his oligarch cronies.

          Is this the New Russia?

          ‘Tis a pity … because few people understand that the economic advance of the past decade has been provided by unused/unexploited residual industrial capacity of the Soviet Bloc era. That capacity is now exhausted and Russia needs new investment (in technologies, production, etc.).

          But Putin wants to parade his soldiers in order to protect the Russian Navy’s exit to the Mediterranean Sea. OK, that’s understandable. But once that is done, what’s in store for the Russian economy?

          In a word, stagnation – and it is already starting. I am predicting nothing …

  6. OMF

    I kind of had to check my browser there to see if I was on the right site. Not that having a shake up to counteract groupthink is a bad thing mind.

    While there is no doubt that the US in particular has involved itself in the Ukraine situation to an obtuse and unsuitable degree, the fact remains that many Ukrainians — including many of the Russian speakers — do not want to go back under the Russian thumb. Or at least not the present one. The fact that it was the rejection of an EU trade deal — generally a bonanza for all concerned — which sparked the major protests shows that the Ukrainians, like most Europeans, see the EU (sans euro) as a source of money and employment which should not be turned down without good reason.

    The EU however, as the article correctly points out is neither a source of sovereignty, nor security. Ultimately the only source of either, and in the long term prosperity, can only come from the Ukrianians themselves.

    Personally I think Ukraine’s only real future is as a non-aligned country. It has no future as a Russian peripheral state, and the presence of an EU/NATO along so wide a border will never be tolerated by Russians. Meanwhile, coming from Ireland, I can safely say that there is no guarantee of having a future as a peripheral state either, and having been thrown to the wolves over a few “cauld” pounds over the banks, I’d rely on the EU for security as about much as I’d rely on a paper bag.

    The Ukrainians should go it alone. Schmooze the neighbours for trade deals and structural funds, but go it alone first and foremost.

    1. Massinissa

      It would be nice if Ukraine was non aligned, maybe…

      But even if it were possible, which I dont think it is, its pretty obvious that it wont happen.

      Its also possible that all of Ukraine will wake up tomorrow and decide they all love eachother and hold hands in a giant circle around their nation. I mean, theres no laws of physics or science against it… But it wont happen. No point dwelling on it.

      Anyway, didnt they sort of try the ‘non aligned country’ thing for the last 20 years? Didnt work out particularly well considering theyre about to be partitioned by two great powers.

    2. Banger

      Yours is a very naive view. I think you need to wake up to what is happening in geopolitical terms. Those of us who read the tea-leaves of mainstream media tendencies have seen the rise of anti-Russian propaganda in recent years. Since WWII the national security state has needed a strong enemy to keep up the strategy of tension that keeps the American population in line. In the 90’s the neoconservative movement articulated through a variety of publications around the Project for a New American Century the basic tenets of American power which I will make brutally simple: the U.S. population, without a common purpose, will degenerate into hedonism and tribal bickering thus an external enemy must be created (a new Pearl Harbor) to galvanize the population to spread American style “democracy” to the rest of the world. The tactics are and were to destabilize hostile regimes, particularly in the Middle East, so the people can establish new forms of gov’t along American lines.

      Russia is the new old enemy. Putin is the new Saddam, Osama, Noriega, Assad, Mao, Stalin, Khrushchev, Hitler, Dillinger, Al Capone, Tojo–a face always helps launch us into War there always has to be a leering evil enemy who needs to be crushed.

      Another thing you need to understand is that the American mainstream media is the tool of the American oligarchy–it marches to central authority. Case an point in this crisis–there is no mention of any other POV about Ukraine, It is about valiant freedom fighters against the evil Russian bear. That’s the extent of the coverage.

      1. Vatch

        People in government have always used foreign enemies as a way of uniting the domestic population, and yes, those enemies were sometimes manufactured. More than 2200 years ago, Cato the elder would end every speech, no matter what the topic was, with “Carthage must be destroyed”. He saw the value of a foreign enemy.

        Yet sometimes the foreign governments really do behave quite badly, and deserve sharp criticism. Just because U.S. leaders behave badly is no reason to ignore bad behavior by Russia (or China or whoever).

        1. Banger

          You and I disagree about who behaved badly. I believe the U.S./EU supported and encourage a coup d’etat while Russia was focused on Sochi. It is the U.S. that has been spoiling for a fight with Russia. You accept the mainstream media narrative on events in Kiev, I don’t. The fact remains that Ukraine was a Constitutional democracy now it is a divided country where the language of a significant part of the country (Russian) is now banned and nationalists and fascists have taken over the western part of Ukraine–you deny any of that?

          1. Vatch

            I agree with you that both sides have behaved badly. I’m not convinced that fascists have taken over the western part of Ukraine. Things are still very murky. I’m reminded of the anti-WTO protests in Seattle in 1999, which started out being non-violent. Then the black clad faction started committing vandalism, and the supporters of the WTO started falsely claiming that protesters were using Molotov cocktails, etc.

            Who are the fascists in Ukraine? If they exist, is someone pulling their strings? Is that someone in the West or in Russia?

            1. Banger

              Svoboda Party, Patriots of Ukraine, Trident all came under the umbrella group of the Right Sector who were responsible for much of the violence on the street. BTW, the mainstream media refused to cover this fact and also the fact the police had no firearms and the half-wit Yanukovich gave into the demands of the right-wing thugs.

              Where did they come from and who is behind them? The National Endowment for Democracy for one and many other NGOs who have been pouring money into Ukraine isnce 2004.

              1. Vatch

                Since you know some party names that I don’t know, maybe you can tell me whether the new prime minister, Arseniy Yatsenyuk, belongs to one of the right wing parties. His party is the All-Ukrainian Union “Fatherland”, which isn’t on your list, but maybe it belongs there. Is it one of the right wing parties?

                1. Banger

                  The Fatherland Party is Yulia Tymoshenko’s party as far as I can tell it is centrist–won 20% of the votes in the last election. Some believe it is closely tied into the local oligarchs which, I guess, involves all the factions in Ukraine. At present it isn’t clear who actually controls the country de facto–it will take several days to see who actually has the power and the rotten coverage of the events certainly does not help. The party differs from the former ruling party because it favors IMF over Russia–it is also the hand selected ruling party the U.S. wanted in office.

                  1. Jerome Armstrong

                    So you’re of the belief that UDAR is part of a fascist alliance as well? That’s just not the case. I’ve taken to just going straight to Russian and Ukrainian websites for the straight translation of events and opinions. Most of what I read coming out of American opinion is just straight up nonsense from people trying to fit the situation into their preconceived opinions.

            2. Snake Arbusto

              The back-clad faction? And who do you think was manipulating the black-clad faction, as indeed they’re manipulating the black-clad factions now in power in Kiev?

      2. susan the other

        Thinking in terms that each citizen understands: your allegiance is your bond, is also the cash in your pocket… Paul Craig Roberts has just focused on the US: either we can save the banks (our great cold warriors) or we can save the “value” of the dollar but not both; and above Hudson says MMT can’t work if our (or anybody’s) sovereignty is trashed… its murky but not totally murky. Because now at a juncture of global cooperation (which will one day lead to a currency backing that cooperation) we in the US can still play our trump card which is the ace of petrodollars – if we shut down the credit spigot it makes everybody with dollars in the bank much richer. And everybody trying to achieve a balanced budget brutally trashed – even before we achieve a global currency. So the dollar is saved AND voila! so are the banks. Briefly. The risk is nationalism which is probably why we backed neo-nazis in the Ukraine.

        1. susan the other

          So one more thought: if it is coming down to an international, global currency at some point, after the dollar abdicates, it is the battle between the internat. fascists v. the more benign socialists. At the point of internationalism there is no sovereignty to back either one – ideally. But something will have to replace that sovereignty because there will have to be some mandate for governing. So who controls socially beneficial spending?

  7. Myroslava Basladynsky

    There are good reasons why the left has lost influence and credibility in this country. It is fundamentally stupid and morally bankrupt (and I say this as a progressive liberal). Mr. Hudson is repeating all the pro-russian communist factoids and memes that have been discredited for decades now. Every event is not understood from an analysis of the facts at hand but is regarded through a lens consisting of propaganda and disinformation. Those who know their history know how the left ignored the deaths of millions of Ukrainians in the 1930’s from starvation and the mass deportation of Tatars from their homeland by Stalin — and, of course, the political repression of all of eastern Europe. The humanity of ordinary people (the very people the left claims to support) was dismissed and debased in the service of a bankrupted ideology. Now the suppport is more subtle but it comes from the same source — a tragic inability to see things as they are — perhaps because one doesn’t want to see them.

    1. Banger

      I suggest the propaganda comes from the mainstream media. The events are simple. A disagreement over whether Ukraine should veer towards Europe or Russia erupted in the streets when the freely elected government decided to go towards Russia. This demonstration grew and eventually overthrew (illegally) the sitting government effectively instituting a nationalistic (Ukrainian for Ukrainians right-wing government including neo-fascist and nativistic parties) agenda banning the language of nearly half the population and roaming the country Libya style enforcing their own justice. These are indisputable fact you choose to ignore since you believe the mainstream media reports accurately what goes on in the world and I don’t having seen sometimes directly the biases of the American mainstream.

      Now for your attack on Mr. Hudson and leftist of his ilk. I will counter-attack and say that the let is moribund because it has accepted the mainstream narrative that Hudson tries to counter because he chooses to keep his eyes open along with others connected to him like Bill Black. It is leftists like you that have sold out the country and the world to the rule of oligarchs. Yes, Russia is a semi-authoritarian state that has done nasty things over the years–but is the U.S. better? How many have died as a result of U.S. aggressive wars from Vietnam to Afghanistan?

      Now challenge Hudson on the facts not because you want to believe the Washington consensus on this and perhaps Syria and Venezuela. I urge you to read the readings published by PNAC and the doctrine of full-spectrum and replay the tape made by “Torrey” Nuland (wife of Robert Kagan–search into his background). Think a little more deeply and understand this is Cold War II created by operatives who want there to be a full-scale strategy of tension in order to keep power for the few.

    2. fledermaus

      While Putin is no angel, hauling in Stalin-ear policy to critique the the current situation doesn’t add anything. That said the people of the Ukraine are going to figure out how to move forward on their own. I admit their eagerness to join the EU is puzzling to me and I believe that it is mostly lead by local politicians angling for a chance to sit on a bigger stage. Given the experience of Cyprus and Greece under the EU, I doubt most Ukrainians want to sell themselves into debt peonage to a bunch of European bankers.

    3. OIFVet

      Myroslava, everything that you say can be fully applied to the right wing as well in because of its uncritical support for oppressive and murderous right wing regimes. Chile, Argentina, Indonesia, Nicaragua come to mind immediately. As a fellow Eastern European I hear what you are saying, but to use past Soviet oppression as a guide is to disregard present realities. And the reality of the situation is quite simple: there is a campaign to push NATO against Russia’s borders, and even to achieve the break up of its Federation. Promises made by the West in 1989 not to expand NATO were broken. Russia quite understandably feels threatened and it is in fact under threat. You can’t honestly expect them to roll over for a belly rub; whatever their shortcomings they are always ready to do whatever it takes to defend the Rodina. The west has pushed too hard and too far this time, and I blame it for this situation, not Russia.

      PS And given that there are quite a few of my own people in Bessarabia I feel that the repeal of the language laws constitutes a direct threat against them and all other minorities in Ukraine.

    4. Lafayette

      The Ukraine has much relearning to do.

      If the oligarchs were able to take advantage of a political vacuum, when the Soviet Bloc dismembered, it is largely due to no viable opposition to its manipulations.

      So be it. Time to move on, but without the oligarchs. THAT is the big problem. Meaning, how to make sure they are not part and parcel of the political landscape in the post-Maidan Ukraine.

      Any ideas?

      I have one: The oligarchs have very likely stashed their horde abroad, and more than likely in the EU or the US. Both of which can seize those funds and await a legal request by a Ukrainian magistrate to recuperate them. Then the Ukraine government negotiates with the oligarchs (Yulia included) as to the manner in which they will be allowed to have back their unfair share of the ill-gotten gains. Likely to be minuscule compared to the real amounts, but nonetheless important.

  8. Bridget

    “What would Dick Cheney (or President Obama for that matter) have done if Russian NGOs sponsored separatist movements in Texas, California or New England? ”

    Fail. Ukraine is not a state in Russia. The question should be, WWDCD or WWOD if Russian NGOs sponsored separatist movements in Quebec.

    1. Massinissa

      Comprehension fail: Ukraine was a russian state for HUNDREDS OF YEARS.


      1. Massinissa

        And California has been a US state for how long? 150?

        Ukraine has been in Russia much longer than Cali has been in the US

        1. Snake Arbusto

          For that matter, Texas was part of Mexico and was annexed by the US after provoking Mexico and using their reaction as justification for an invasion. Just as Russia is now supposed to allow the US/NATO to do now?

          1. Bridget

            Not quite. Texas was an independent country after winning its independence from Mexico. (after Mexico won its independence from Spain) It’s citizens later voted to become part of the United States.

  9. adriannzinha

    The long sought after goal of us imperialism to put armies at the foot of Russia’s door, encircle, and ultimately dismantle Russia, is one step closer. As with Georgia several years ago, this prompts the obligatory response by the Russian regime. This is hardly unique to Obama as successive administration’s keep pushing the envelope and putting us at greater risk for a large scale conflict. It won’t end well..

  10. Banger

    Excellent commentary by Mr. Hudson as usual. He understands the political economy of the region better than most because he is not influenced by the American mainstream media as many are who post here. How many times do people have to experience being Charley Brown trying to kick a football and believing that Lucy will not pull the ball away at the last moment? Why do any of you believe anything that comes out of the American mainstream media.

    Here is what the media is not saying. It is not saying where the funds came from to supply the “demonstrators” in Kiev with food and other aid including stipends. Ok, let’s pretend the CIA does not overthrow governments through precisely these means–Americans don’t like history and will usually deny “conspiracies” or if they happened in the past they certainly don’t happen now because we are “good.” Ok, forget the western intel, and forget looking into just what the National Endowment for Democracy is or what its budget is or anything else about them–they are just good Americans trying to help the poor ignorant savages learn how democracy is done in the magical land of the Greatest Country the World Has Ever Known. Ok, all good guys earnestly giving of themselves to spread human dignity and so on. But the fact still remains–there was an elected government in Ukraine which is or was governed by a Constitution that was overthrown through force by mobs in the streets against the wishes of if not a majority at least a very significant minority. Imagine a mob in Ottawa overthrowing the government and banning the use of French in Canada.

    We can grouse about the Russians, the gangsters, the oligarchs–but has anybody looked around in the U.S. these days? I see fewer gangsters here but the oligarchs are even more in charge here than in Russia–I see a country that recklessly rushes into aggressive wars against weak countries who do not threaten us systematically breaking every provision of the Geneva Conventions on War, mass bombing of civilians (Iraq), collective punishment (Iraq, Afghanistan, Libya and we won’t mention Vietnam). This same country chides Russia for breaking international law!!!!!! We have broken every conceivable part of that “law” which really does not exist other than the law of the fist.

    Russia, for all it’s faults, is defending itself and Putin is fulfilling his duty as a Prince just as Obama and his superiors are fulfilling their roles as Princes. The difference is this: the various Princes that dominate U.S. foreign policy want to run the world Russia just wants to survive as an independent entity like Iran like Venezeula and other Latin American countries who will be next in this new assault on the world initiated by the newly resurgent Torrey Nulands and Robert Kagans.

    So back to the world of economics and finance that certain people who castigate some of us who believe there is no separation between economics and politics (or culture for that matter). This means money will go to the martinets of the world as we enter now, officially and with great fanfare, Cold War II. The mainstream media failed to stampede us into war with Syria–maybe the specter of the Big Russian Bear will rouse us all to beat our ploughshares into swords yet again.

    1. Vatch

      Hi Banger,

      Imagine a mob in Ottawa overthrowing the government and banning the use of French in Canada.

      Would that be a justification for the U.S. (or any other nation) to invade Canada? Because that’s what Russia did to Ukraine in the current crisis. This was not an act of self-defense by the Russians.

      As for your criticism of misbehavior by the U.S. national security apparatus — of course I agree with most (maybe all) of what you say.

      1. Yves Smith

        Russia has not invaded. You’ve been watching way too much American TV.

        Russia PER TREATY has the right to station as many as 30,000 troops in the Crimea. The move of 6,000 more in can be called a provocation, but it is most certainly not an invasion. It has existing bases there.

        1. Vatch

          I understand that there is a treaty, so the situation is a bit like that involving the U.S. naval base in Subic Bay in the Philippines. The Philippines sent the U.S. Navy packing around 1992, but a couple of years ago allowed the U.S. Navy to come back. The U.S. presence will probably be smaller than it was a few decades ago. Guantanamo Bay in Cuba also comes to mind.

          With respect, please let me suggest that since many of the troops deployed in the Crimea have not been wearing their insignia, it is difficult to know what is really going on or how many troop are there. How can we be sure that the number of Russian troops is still within the limits of the treaty? If U.S. troops in the Philippines or Cuba seized government buildings and airports, would that be considered an invasion or routine troop movements?

          Perhaps what is happening in the Crimea is a less than an invasion, but more than routine troop movements.

        2. Roman

          Ah yes, American TV. I assume by that same treaty they can block Ukrainian airports and military bases in Crimea, take control of Ukrainian block posts, and Crimea parliament building, block Ukrainian fleet, and constantly set time limit when Ukrainian military bases personnel need to leave their bases without their weapons. Seems like you’ve been watching way too much Russian TV.

          1. Yves Smith

            If you read the news reports carefully, these accusations all come from “Ukrainian officials” (see for instance, the 10:15 AM entry here:

            There’s reason to think that some, and perhaps many, of the claims are exaggerated:

            But here’s the problem: The new people in Kiev, who have suddenly found out that the West is not really rushing to provide them with financial aid, are starting to panic, realising that if they wouldn’t be able to pay salaries and pensions to government workers they might find themselves facing similar protests that had brought down President Viktor Yanukovich and the previous cabinet.

            And that realisation prompted the interim government to talk about the threat of “Russian aggression” and even “intervention”, because it is what desperate regimes do when it finds itself in trouble.

            The problem with the “revolution” in Kiev that broke out in supposed response to the decision by President Yanukovich not to sign the deal of free association with the EU, is that it undermined the delicate balance that had existed in Ukraine and with all its faults still provided stability.

            Once the elected president had been deposed, the whole system simply fell apart and no one really knows now what the consequences will be.

            Nevertheless, I would suggest to all easily excitable people not to draw too many conclusions from the latest developments, as a lot of political posturing is going on, on all sides involved, and not all decisions and statements are going to be implemented and carried out.

            But one thing is certain: Moscow is sending the strongest signal since the war in Georgia in 2008 that it is not going to tolerate an unstable, Western dominated Ukraine on its border.


            1. Lafayette

              But one thing is certain: Moscow is sending the strongest signal since the war in Georgia in 2008 that it is not going to tolerate an unstable, Western dominated Ukraine on its border.

              It has already tolerated the loss of East Germany, Poland, the Czech and Slovak Republics, Romania, Hungary.

              Why not the Ukraine? Especially if a plebiscite showed clearly that the western Ukraine actually supported closer ties to the EU?

              The taking of the Abkhazia and South Ossetia was much more remote geographically, and the West let him get away with it. There was not that much that could be done militarily.

              But the Ukraine may be an altogether different matter, at least for the EU. Which is why, I submit, the EU has already gone out on a limb by its first offer of a closer economic link with the Ukraine.

              In the upcoming negotiations, Putin, will have already moved his pawns into the Crimea to maintain the Russian navy’s outlet to the Mediterranean Sea. But, unless “the King” is looking for sanctions that could irremediably hurt Russia’s worsening economy, he has to give up something.

              I’ll bet he “gives up” the western Ukraine … unless the EU backs down first.

        3. vlade

          Sorry Yves, disagree. Say Simferopol airport is not anything that Russians could claim as to have legal basis of occupying (or the parliament building). It’s like saying that US bases in Cuba entitle it to occupy government buildings in Havana.

          Not to mention that Russia never (so far) admitted that the insignia-free (including rank etc.) armed forces are theirs. Incidentally, Hague convention (or should I say majority interpretations) requires that combatants have “fixed distinctive emblem recognizable at distance”. In theory thus those armed forces could be treated as terrorists, and definitely do not fall under the Ukrainian/Russian treaty (how do you if you unidentified?)

          1. skippy

            The precedence [dominate imo] has been established after a few decades in the ME et al… eh.

            Skippy… insignia… really?

            1. vlade

              True, but Yves was arguing that they have legal right to be there (they have, to be at the base of Sevastopol and elsewhere as stipulated by the treaty). So they should follow the treaty and legal requirements (which includes clear identification as Russian soldiers). It doesn’t say anything about legality of ME. Either we hold all the parties (US/EU/Russia/China etc. etc.) to the same standard, or neither. Not that this is the current or even historically most common done thing, but hey.

              Putin is now claiming those aren’t Russia’s soldiers (so he can say they stayed within the bounds of the treat), but that’s just a fairly clear lie. If you look at the kit they have, it’s not the standard issue AK74s, which would be most likely something that a homegrown militia would get. There are some heavily modified AK 74s (para versions, with lightened stock, holo sights), but then you also get some high grade kit. GM-94 (grenade launcher) with holographic sight (made in US, >$500, very popular amongst Russia special forces according to my source), PKP/PKM light machine guns with rail systems (again, popular with SF), but most telling paratroop (shortened) version of SVD-S sniper rifle. All of the previous ones you could get if you had lots of cash (and in Ukraine $500 is quite a bit of cash to spend on sights), but not this sniper rifle. It’s not even issued to normal Russian units (and not used/sold anywhere outside Russia).

              At the best, Russia’s given some high-spec, costly, military kit to pro-Russian militia. More likely, it’s actual Russian military (spetznats if I had to make a bet).

              1. skippy

                Do you have any idea of how many plain closed “advisers” toting high tech spec roam the planet at any given time which are north American in origin of birth. That’s not even getting into private security mobs, cough merc, who says you can’t transition skills to the private sector… snicker.

                Again… your instance on treaty and legal requirements is laughable considering the decades denoted above. Seriously, a country that would not pay its UN bill unless it get its way can’t bemoan legality. Depleted uranium every where, Wille P used to subdue a city, open air disposal of toxic chemicals via detonation or burning, long inglorious list, etc.

                skippy… You have to laugh a bit… Putin is a product of Rubin and Lawrence machinations… neoliberalism the gift that keeps on giving…. eh.

      2. Banger

        I was making a partial analogy of the strikingly negative attitudes of the neo-fascist thugs who now run Ukraine. The problem would exist in my analogy if the U.S. spoke French as its main language.

      3. NotTimothyGeithner

        Why not? Do you advocate returning California to Mexico? Sam Grant, a veteran of the conflict, wrote his memoirs that he long thought the Mexican War was a project of Southern slave holders to provide a Southern route to the Pacific for a future pro-slavery country. We more or less went to war with Mexico to protect the rights of former U.S. citizens who fled to Texas to own slaves and revolted when Santa Anna, that odious tryant (snark), outlawed slavery.

        The U.S. doesn’t have a fantastic track record in the last few years with both political parties in charge when it comes to foreign intervention. We knocked out Gaddafi after he agreed to disarm, and Libya has certainly turned into one of the finest examples of newly failed states. The Russians no longer care what we think, and the position of most EU politicians is precarious. Cameron can’t win without a coalition and the utter corrupt nature of New Labour. Hollande is trying to resurrect the French African dream. Merkel had to use every appeal female voters to return to a coalition led government.

        We can discuss international law til the cows come home, but we have to make assessments about our place in the world and whether is worth our time. After Iraq, the continued occupation of Afghanistan, our drone wars, our support for opium production world wide, Libya, saber rattling with Iran, Syria, our financial invasion of Russia in the 90’s, and our myriad of hideous NGOs designed to enrich a few American elite, why would the Russians care?

        As far as your analogy goes, does the U.S. have a major military alliance on its borders dedicated to blunting its existence? No. Does Canada have a history of neo-nazi movements and participants? Well…Harper, but no. Churchill proposed that the USSR gobble up so much land so the Western Allies wouldn’t have to deal with the rank and file fascists. We got the good Germans who arrested Hitler during his first attempt at power. Does the United States have a history of invasion by foreign powers? Japan bombed Pearl, but no, not ever really. The burning of Washington was retaliation for American brutality during our invasion of Canada. The last part is are the locals Russians? What does it mean to be Russian? Should they have rejoined the Russian Federation with the fall of the USSR?

        This is why it was important for the United States to hold its leaders accountable when Obama took office instead of giving Dubya a send off. This country has no kind of authority, and we can’t pretend we do until we fix this country.

  11. Lafayette


    What’s happening is mostly theatrics. On the part of Putin, “Defender of the Great Nation of Russia”.

    BigBrother Putin would have the Russians thinking about something other than the fact that the Russian economy is stagnating. It has burnt up all its excess industrial capacity and, since Russian businesses do not have the wherewithal to invest in expanding it, the economy is stagnating.

    The basic fact of this matter is that the Crimea was an integral part of Russia until Khrushchev signed it over to the Ukrainian government. So, the Ukrainians should be very happy to give it back to Russia – as full repayment of the $16B debt that the Ukraine owes to GazProm (the Russian gasworks).

    Then the Ukrainians can move on to a plebiscite to determine which of the regions wants to “go back to Russia” and which will remain. That’s the hard part. Most of the Russian-speaking Ukraine is bilingual. They are not necessarily ethnic Russians, though those of Crimea are indeed ethnically Russian.

    Those in the eastern part of the Ukraine can then make up their minds, as to whether their future belongs with Russia, which is going nowhere economically, or the EU, which is a far better bet for international trading – and thus resuscitating the Ukrainian economy.

    The Ukraine still has a major problem to solve, and it is the fact that, just like Russia, the oligarchs who purchased national assets at a pittance have been running the show. Good riddance to Youkanovitch – who was at the top of the heap.

    The problem is that he was not the only one. Yulia Timoshenko’s family also got “oligarchically rich”. The Ukranians will have a very difficult time getting rid of these encrusted families. (One way to do it is to put pressure on those oligarch families who have placed their assets offshore – like London, Frankfurt or Switzerland – by threatening to confiscate their ill-gotten gains.)

    There is a great deal of Democracy Building (institutionally) that must be accomplished by the Ukraine and the EU has a role to play. But the EU must determine precisely if “EU-ization” is a possibility for the Ukraine. It will take another 5 to 10 years for the Ukraine to implement the economy according to EU-strictures.

    As the EU has done with other new-comers to whom it has been a hand-holder in the transformational process before entrance to the EU.


    Let’s allow, for once, the Ukrainian people decide whether their country should be facing east or west.


    And what if the Castro brothers just walked into Gitmo and declared its reattachment to Cuba. (What a lark that would be … !)

    1. Massinissa


      And what if the Castro brothers just walked into Gitmo and declared its reattachment to Cuba. (What a lark that would be … !)

      Actually, as strange as it would be, you could probably claim that theyre defending human rights. I mean, what goes on in Gitmo pretty much breaks international law.

  12. John Mc

    Quick question. Has anyone had problems accessing New Economic Perspectives Website? I am not able to get on it for some odd reason (two days now). This Michael Hudson article reminded me.

    1. Jon hooper

      I think they are doing site maintenance. There was a post on the site to that effect a couple of days ago

  13. optimader

    “What would Dick Cheney (or President Obama for that matter) have done if Russian NGOs sponsored separatist movements in Texas, California or New England?”

    1.) the Ukraine is not a State in Russia ( or the Soviet Union for that matter) so fallacy of false analogy

    From Vlades accurate comment above:
    “Yanukovych is the kind of kleptocrat that neoliberals promised would…. “. Hello? Yanukovych was and remains a Russia’s puppet (not to mention a convicted criminal etc. etc., but that’s just how the politicans in ex Soviet block roll). ….all I can see is Russian apologists.”

    As well:
    2.) Yanukovych was a puppet that was ignoring pages in his marching orders.
    Good puppet: He signed a longterm lease til 2047 providing a Crimean naval port to Russia.
    Bad puppet: Doing the wallet slow draw on paying for ~$2BB in stolen Natural Gas, making Putin look like an unreliable supplier when he shut down then turned down the supply o Nat Gas to the Europe.

    “How would US police have reacted against armed revolutionaries seizing the armory and throwing Molotov cocktails and bombs at public buildings, killing police, painting swastikas on Jewish houses and claiming vigilante justice? While this does not characterize all of the Ukrainian protesters…”

    Probably at least if not more violently, and the point is what??

    Alternate question, how would American “revolutionaries” have reacted to police snipers shooting them?
    Would it be a possibility that some percentage of American “revolutionaries” would act in a immoral manner (painting swastikas on Jewish houses and claiming vigilante justice)? I’m guessin Yes.
    Kinda sounds like the some of the sort of unseemly things that happen during a revolution, does this invalidate a revolution?

    –The notion that the US shouldn’t provide military/financial assistance w/ players in the Ukrainian revolution is valid. (we historically do a very bad job picking winners, file under: Shah of Iran.)
    –The implied notion that the Ukrainian revolution is dependent on US involvement I suspect is a naïve one.

    1. Bridget

      “–The implied notion that the Ukrainian revolution is dependent on US involvement I suspect is a naïve one.”

      Naive? More like delusional. We just aren’t that good.

      1. optimader

        News Flash hot off the Telegraph Wire
        You do realize the Ukraine has been a Republic since the Union of Soviet Socialist Republics experiment failed ~22 years ago, right? That means the Ukraine is no more a State in Russia than Texas is a State in Mexico.
        File under: Ukraine, currently a Sovereign Country

    2. Snake Arbusto

      Let’s try to find a more neutral term than “revolution,” if it’s all the same to you…

  14. Greg Kaiser

    While we debate whether the Russians, the Ukrainian rioters or the Neoliberals on Wall St (who foment discord on the other side of the world) wear the blackest hats, what’s going down at home?

    In the past thirty years, capital investments that haven’t gone to China or elsewhere out of America, have been largely redirected to the lucrative lending/credit market. Where will the lenders, who are motivated to profit by interest on their investments, put their money if our governments (fed, state and local) stop borrowing it and American consumers are too saturated with debt to take up the slack? What happens to the US economy if the governments and the people can no longer purchase the goods we make or import? If foreign markets are found for US goods, whether produced here or in China, how do we the people survive when exports of consumers goods result in supply and demand price increases that we can’t afford? Most of us can’t afford what we need to live at today’s prices! Things may work out for the one percent and their chief ministers [CEOs and politicians] as well, as a small fraction of the population who are professionals and managers, but will the 90% majority starve? Remember, the neoliberal economic miracle demands an end to food stamps too.

  15. backwardsevolution


    “While there can be no doubt that ousted president Yanukovych was a corrupt pr*ck, he was still democratically elected. And considering that, instigating regime change on Russia’s doorstep would have to be a step so risky that perhaps only a somewhat 18th century megalomaniac mind would attempt it. Victoria Nuland and US ambassador to Ukraine Geoffrey Pyatt had been negotiating their goals for quite some time with the Ukraine opposition, so much so that Nuland calls new PM Arseniy Yatsenyuk “Yats” and leader of the Ukrainian Democratic Alliance for Reform Vitali Klitschko “Klitsch” in her conversations with Pyatt. These people know each other. Well.

    “Yats” is now the PM of what should probably be called a technocrat government (illegal as it may be), he’s a former – central – banker, a pattern that has a familiar sound to it, most recently observed in southern Europe. […]

    Nuland wasn’t just impatient with the EU, she wanted the whole process to move faster. And that’s where she made here biggest kingmaker mistake: she got into cahoots with various highly shady and questionable right wing groups, who, since they were armed and willing, seemed the ideal partners for the US to speed up events.”

  16. backwardsevolution

    “The overthrown president, who has since fled to Russia, was accused of mass murder, and the new government demanded his extradition (a dumb move, since Russia’s constitution forbids extradition). But there are serious questions about this interpretation of events: the special forces were never issued rifles and were never ordered to open fire on the protesters; there were quite a few special forces members themselves among those killed; the killings were carried out in such a manner as to incite rather than quell protest, by targeting women, bystanders and those assisting the wounded. The killings were followed by a professionally orchestrated public relations campaign, complete with a catchy name—“Heaven’s Hundred” (“Небесная сотня”)—complete with candlelight vigils, rapid clean-up and laying of wreaths at the scene of the crime and so on. […]

    [Update: Based on some of the responses, people still have trouble imagining what it’s like to have the fascists in charge. Well, here’s a short video in which one of the “revolutionaries” is “holding discussions” with a Ukrainian Attorney General, on camera. You don’t have to understand Ukrainian to see what’s happening.]

    1. Banger

      FYI, the riot police were never armed and, after awhile just left the city since they were outgunned, so to speak, by the demonstrators.

  17. OMF

    A lot of people’s posts here hardly seem to mention the Ukraine itself or Ukranians. While the Crimea and perhaps many eastern regions are largely Russian speaking, and certainly in the case of Crimea historically Russian, I feel I have to point out here that Ukranians are actually a seperate nation from Russia — with a right to self determination even.

    A lot of people seem to be viewing this solely and only through the prisim of a US/Russian conflict. Coming from a smaller country, I do find myself surprised at how casually commentators seem to tacitly assume that Ukraine is simply a pawn, to be shifted left and right, east and west on the chessboard. As if it is the destiny of all lesser nations to fall in with one bloc or the other. To be honest it quite scary to see commentators — particularly Americans — so casually referring to matters in this way.

    So I’d like to reiterate my original point: The Ukraine should persue a strict and dogmatic policy of non-alignment. It should refuse to become involved in the power struggles of great powers and princes, and achieve complete independence form outside interests. It’s clear that Ukranians have no future in tying themselves to “foreign benefactors”, from any direction. What is even more disturbing is that, it is not clear to me that Ukrainians themselves see things much differently.

    1. OMF

      The last sentence of that last paragraph should have been on the second paragraph. Anyway, my point was that I haven’t seen an indication that Ukrainians see the need to persue a future by themselves, for themselves.

    2. Massinissa

      Its not ‘just’ Crimea, its most of Eastern Ukraine.

      You do realize SOMEBODY elected Yanukovich: That somebody = Eastern Ukraine.

      Eastern Ukrainians are pro Russian: Western ones are pro Europe. Kiev is in the western side. This is hardly different than if our capital was in Texas and a bunch of right wing texan loons decided to overthrow Obama.

      Well, Ukraine could try having elections again… But West Ukraine would probably deem them illegitimate again and replace the president again, just like they did to Yanukovich. If they do it once they will do it again: What the west ukrainians are doing is fundamentally anti-democratic.

      1. NotTimothyGeithner

        Yes, but ummm….America…and more importantly Americans are souring on the whole notion of terrorists as enemies and justifications for the non-defense aspects of MIC spending which necessitates a new villain. Fascists aren’t too creative,* so its important to use whatever opportunity to bring back the old villains. The Olympics were just a bizarre saber rattling exercise by our MSM, mixed with the Russians can’t build toilet joke from 1956.

        *Hitler didn’t get into art school after all. I do think American style fascism is the dominant force in the American elite. They just call it freedom because its a good word in American circles.

    3. OIFVet

      “To be honest it quite scary to see commentators — particularly Americans — so casually referring to matters in this way.” Kind of gives the game away, doesn’t it… “Freedom” and “democracy” by butt.

  18. Dylan Robb

    It seems that no one in this administration has ever read George Washington’s farewell address from 1796 that warned against entangling alliances with other nations. We have no place getting further involved in the region. It is not like our country is so well run, that we can handle the affairs of other countries. Our involvement has set up most of these problems & only our disengagement can begin to rectify the grievous error.

    1. NotTimothyGeithner

      Remember Washington was available to attend the Continental Congress because he lost his election to the House of Burgessess now the Virginia House of Delegates for encouraging everyone to simmer down because he was worried things were heading to a conflict and warned about the actual effects of war. When the war came, he went. Washington didn’t say “Valley Forge wasn’t that bad because no one shot at us.” I don’t see Washington being a predator drone advocate.

      The final character of Washington is radically different from much of our current elite. Yes, people are products of their times (obviously he was a slaveholder), but the Geneva Accords for Treatment of Prisoners comes from Washington’s war time policy, when the British would have hanged him. Amazingly, Washington found time to institute better policies which we can’t afford in modern America because…terrorism! Yes, he offered the advice, but character-wise, I think Washington wasn’t a believer in the celebration of the status quo.

  19. The Dork of Cork

    I don’t not know the true state of affairs in Russia given that I am both a Dork and Vlad is a KGB man with perhaps deep connections with the big bank.
    But one mechanism to deal with his local oligarchs is to go to war in Ukraine and perhaps beyond.
    The Oligarchs who have skin in the game of the current market economy will be toast.
    All he has to do is produce military fiat so his soldiers can have enough Vodka and woman …………and protect is own ass from the backlash (perhaps not as easy) – oil use will be internalized and not exported
    Europe will implode.
    Just to repeat the dynamics of current Russian oil use is very different from the 1970s and even 80s.
    Will we see a reversal back to military consumption ?
    Just remember the oil will be wasted anyhow…………….

  20. Abe, NYC

    I’m with vlade. This is a blog that on a daily basis (rightly) vilifies Obama for his anti-democratic, pro-oligarchic, militaristic policies. Here you have Putin, who makes Obama look like a paragon of peacenik social democracy, and somehow we are supposed to be all dewy eyed about the injustice dealt the earnest gentleman and the abject failure of the West to recognize his mighty achievements. This for a guy who has steadfastly supported oligarchs in his own country; who has cultivated corruption at all levels of government to strengthen his hold on power; who has consistently stood up for Russian and Ukrainian elites against popular will; who destroyed independent media in his own country and has used pocket TV and press to brainwash his population; who installed a mass murderer as his vassal to tame a breakaway province; who turned Russia into a military aggressor along the lines of 1930s Germany.

    I don’t get it. I do understand that Obama should be held to a different standard than a former KGB officer, but there has to be *some* standard. Should we praise Mr. Putin for not eating little children for breakfast? ‘Cause he doesn’t shy from killing little children, you know.

    1. Banger

      You don’t get it? Ok, how’s this. A freely elected government was overthrown on Russia’s borders by right-wing chauvinists who basically said to the Russian speakers (not only ethnic Russians) that they were not welcome and promptly banned the language. You can rant about Putin and how bad he is (your information of course comes mainly from American propaganda organs that have systematically lied about almost every major issue for decades. Putin is an authoritarian leader who rules with a heavy hand. Obama is a relatively weak leader who is subject to higher authorities, i.e., American oligarchs who are not, I believe, much of an improvement over Russian oligarchs other than the fact Americans speak better English.

      Another difference is that Putin wishes to help his country stay in play on the world stage and keep his borders relatively stable. The U.S. in contrast is an aggressive imperialist power bent on “full spectrum dominance” and has practiced a pattern of overthrowing governments or trying to, that it does not like since Iran in ’53 and continuing today to funding, through NED (look into that org and learn something) and other non-profits.

      I feel the American imperial project is harmful to me personally and oppose it–you probably like it and believe the lies told by the mainstream media despite stunningly obvious evidence that they lie or misdirect about all major news events, but most particularly foreign events.

      Having said that, Putin should get to the negotiation table ASAP–I believe his moves were specifically taken to get precisely to that table. The U.S. wants Cold War II for complex reasons but the Europeans may not want that–so the ball is in their court.

      1. vlade

        Just for your information, Russia has been expanding at a rate of over 100 square km per day since 1600 to 1914 (the Russian territory between 1646 and 1914 grew by 55%). First big chunk of land lost by Russia was Alaska (sold to cover the costs of Crimean War), first involuntary loss was Poland after WW1, and it got most of that (and more, say easternmost part of Czechoslovakia, Ruthenia) back after WW2.
        So Russia was imperialistic and expansionistic well before there was a hint of USA ever being in existance. Toppling/installing puppets regimes is an art as well established in Kremlin as in White House, if anything, Kremlin is more pragmatic and ruthless about it (as openly autocratic regimes tend to be, if the autocrat is at least reasonably efficient).

        Your rethorics reminds me so much of Stalin/Soviet Russia eulogists in 1930s. Enemy of my enemy != my friend.

        1. Banger

          Big difference between this period and the Soviet period–the goal of the Soviets was to create world revolution–Putin is not a revolutionary but a regional leader who seeks influence not conquest. Whereas U.S. official policy is conquest–i.e., “full spectrum dominance. You won’t find anyone more opposed to Stalinism and even Leninism than me–I believe Stalin was, in some ways, worse than Hitler so don’t characterize me in that way–you think I don’t know history or understand Russian culture?

          I look at today and the power arrangements that exist today and know far more intimately than you the career of American foreign policy in the post-War era.

          1. vlade

            Sorry, which part of the pre 1914 world had the Soviet period?

            Arguably after WW1 Russia (let’s call USSR Russia for convenience) was only getting smaller despite gobbling Ruthenia and Baltics after WW2 (Baltics were too part of Greater Russia in the past. Does it mean that Putin has right to gobble them again and make it third time lucky? So was Finland)

            We’re not discussing American FP here (and you might find that I would even agree with you on quite a bit of that), and to be honest, unless you get a trusted source (say Yves) to declare she knows you know more about whatever, or you back it by verifiable facts, it’s just few electrons (as are mine, if I don’t back it by facts or a trusted source).

            And, to your (rethorical) question – unless you lived in Russia for an extended period of time (as in years), I doubt you can really understand Russian culture. I don’t claim to understand Russian culture, and I can read and speak Russian, have Russian friends, and worked with Russians for years and spent some time in what was then Soviet Union.

            Putin seeks to establish dominance over what was Soviet Union, and ideally the ex-Soviet satellite countries as well, and to be the undisputed leader of the Slavic world. As I wrote somewhere else, I won’t even fault him in it, it’s Russia’s version of Monroe’s doctrine. But that doesn’t make the states that he rolls over while doing so any happier. They didn’t like it when Soviets controlled them, and they don’t like it when Russians try to do the same, especially by bullying.

Comments are closed.