More Signs of Doubt in Europe About the Costs of Siding With Ukraine

This week, the US hopes to get the EU to agree to impose so-called tier three sanctions on Russia to punish them for their alleged role in the downing of MH17 and for supporting the rebels in Ukraine. That would include prohibiting investment in Russian equity and debt of Russian banks more than 90 days maturity by European citizens as well as barring EU banks from sourcing funding for them on a regulated market.

One of my colleagues who was in Europe the week before last thought tier three sanctions were unlikely to be implemented. But that was then. The English language press gives the impression that all systems are go, but that depiction could be a PR push to give the sense of inevitability, or it could actually be accurate. Input from readers in Europe very much appreciated.

What is striking is a spate of articles from not exactly expected sources on the potential costs to Europe of putting the screws on Russia. The Financial Times has displayed quite a lot of blood lust on the topic of Russia, so it was instructive to see Wolfgang Munchau, who is based in Germany, sound a cautionary note in one of his comments.

Munchau points out that he’s surprised by the IMF’s latest forecasts, which simultaneously show Russian GDP for 2014 1.1% lower than previously estimated as a result of the sanctions implemented so far, while increasing Germany’s by 0.2%. Munchau thinks the two in combination are not credible:

The Committee on eastern European Economic Relations, a German business lobby with political power similar to that of the National Rifle Association in the US, says existing sanctions threaten 25,000 German jobs. An estimated 350,000 German jobs directly depend on German-Russian trade; many would be at risk if sanctions were stepped up. Total German trade with Russia was close to €80bn in 2013….

In terms of how the sanctions will affect the west more broadly, Francesco Papadia, formerly at the European Central Bank, has estimated in a recent article that the impact on the EU will be about two-thirds higher than on the US. The effect on Russia is going to be much stronger, although possibly not right away. According to the Central Bank of Russia, the country’s foreign exchange reserves had a market value of $478bn at the end of June, a large but finite buffer.

Most of that is presumably held in dollars and euros – and, since they are not held in cash but in bonds or other securities, they would have to be channelled through payment systems in the US and the EU to be usable.

Depending on how the sanctions are drawn up, those reserves may prove hard to mobilise if the EU and the US were to engage in all-out financial warfare.

We are a long way away from that. But even the current list of sanctions could be macroeconomically significant in a way not captured by forecasts or sentiment surveys. My guess is that the cumulative global effect of the sanctions will be much stronger than estimated but that it might be a while before they kick in fully.

OilPrice also reminds its readers that Ukraine is likely to start syphoning off Russian gas destined for Europe. The OilPrice article basically urges Ukraine to man up and accept the harsh terms of IMF assistance, but given that the country was already high on global corruption rankings even before the crisis broke out, and an IMF loan will come with stringent terms, it’s not clear that any government that agreed to them would last very long. In other words, stealing looks like the obvious choice for Ukraine, particularly if they can claim it was really “losses” due to separatists targeting pipelines.

From OilPrice:

The issue of natural gas has divided European opinion on the civil war in Ukraine. Brussels’ plan to force EU members into “energy solidarity” with the disintegrating state of Ukraine and to use illegal reversed gas flows is losing support. “The EU has no intention of repaying Ukraine’s debts for Russian gas,” said Dominique Ristori, the director general of the European Commission’s Directorate-General for Energy, adding that all debt problems should be settled through the International Monetary Fund.

The reference to the IMF is worthy of note. According to the Fund’s official statements, it will offer assistance to Kiev only if President Petro Poroshenko’s “Drang nach Osten” in the Donbass region is successful. Therefore, the end result of the civil war may affect Ukraine’s ability and willingness to pay its debts. The IMF has also given strict guidelines for Ukraine’s international reserves and has set cash-shortage limits for debt-ridden joint-stock gas company Naftogaz Ukraine.

(The IMF demanded an increase of up to 40 percent in residential gas rates by May 2015. The rates will go up 20 percent every year until Naftogaz Ukraine’s gas debt has been paid.)

Historically, countries left on their own in talks with the IMF have often found themselves in danger of sovereign default. The IMF today is anything but a welfare institution — it does not normally assist countries engaged in war.

Ukraine’s government will have to increase domestic gas prices to reach a level on par with the IMF’s standards. This means that in 2015, the Euromaidan babushkas will receive their first 250-euro monthly gas bills. Ukraine’s energy officials often mention their ambitious plans to use fracking or reverse flows from Slovakia and Poland to make up for any gas shortfalls. In reality, the so-called “big gas reverse from Slovakia” would provide for only about 15 percent of Ukraine’s gas needs (after deducting the natural-gas consumption in the Crimea and the Donbass region). In any event, the price of this reversed gas would probably be close to the European contract price.

In regard to fracking, Ukraine’s shale projects are either half-dead or have been officially halted. The European Commission is much more skeptical about shale gas than it was two or three years ago. “Shale gas extraction will bring about no significant reduction in Europe’s dependence on gas imports,” claimed European Energy Commissioner Günther Oettinger in an interview with B.Z. am Sonntag. Oettinger said that in the long-term future, Europe will be able to cover around one-tenth of its overall need for gas by using fracking technology.

Therefore, the government in Kiev may start siphoning European gas out of Ukraine’s transportation system in order to make up for a shortage of natural gas despite all its solemn promises. The media’s fear mongering will be used to portray social unrest as a threat to national security. Meanwhile, Ukraine’s smart prime minister, Arseniy Yatsenyuk, announced his resignation in response to parliament’s failure to pass gas legislation (abandoning the sinking ship of Ukraine’s economy just in time).

Now admittedly, most analysts contend that Europe has enough gas stored to get it through the winter, and Russia will be hard hit by the financial pain of sanctions and reduced exports long before Europe suffers badly on the energy front.

But I’m not sure the financial calculations are necessarily good measures of how this plays out. Russia was used terribly by the West in the period right after the fall of the USSR. Western organizations and Harvard promoted the programs that produced a plutocratic land grab and misery for ordinary citizens. The life expectancy of adult men fell by an unheard of four year during this period. Putin’s domestic support is at record levels and the Russians have a remarkable capacity to take pain. While the conventional calculus may prove to be correct, breaking Russia (or perhaps more narrowly, getting Putin displaced so the West can declare victory and relent) is far from a safe bet.

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  1. John

    Typical European fashion, we are not bothered. Whenever there is a crises to the Continent it is whittled down to national interests (remember how the financial went down). The problem lies there not here is the mindset so we go about our business gossiping about the Tour de France at our favorite watering hole. Ukraine is too far away. Since the Dutch lost the most they grieve the most. I am sad to say it but our mercantilist attitude towards economics trumps even disasters. To make the point, Van Rompuy was in Hispaniola when the MH17 went down. Did he turn his plane around and fly back to coordinate a unified response from the Commission? No. His trade mission took priority. This week-end we’ve been focused on Gaza.

    We will be drafting a cocktail of sanctions against Russis this week but count on them being weak. NATO released some images over the week-end depicting the Ukranian / Russian front-line I am sure that was timed for the EU sanction vote.

    1. Synopticist

      Yeah< i agree with this. There's a lot of bluster in the papers, but I'd be pretty surprised if the UK did anything to hurt the precarious position of the City, which is practically the only source of economic growth in the UK at the moment. Especially given the tories links to Russian squillionares and investment banks, and the election in 9 months.

      One thing you would expect, which has already occurred, is a typical Anglo-French argument about who is the most guilty of sucking up to the Russians-is it British banks or French nationalised industrialists?
      This is partly heart-felt, partly pure Kabbuki, possibly co-ordinated to distract the Americans.

      1. steviefinn

        Maybe it’s simply because they know that it’s all BS which is simply being kept going in the hope that what’s left of Ukraine’s ragtag military that hasn’t already deserted, can secure the East where all the best shale gas deposits are, in order to keep the IMF & Joe Biden happy.The fact that Vicky’s beloved ‘ Yats ‘ has resigned from a punch up ridden senate & the fact that there is no conclusive evidence to show who shot the plane down, might also have a bearing.

        It could also perhaps explain the hysterical nature of the propaganda that has been screaming out of the West’s media, as it was never really likely that a bunch of oligarchs, Svboda etc were ever going to join hands & work together for the good of the Ukrainian people, but more likely behave like the rats they are, turn on each other as Putin probably expected..

        Van Rompuy – Give me a break, he even looks like a puppet.

        1. susan the other

          You never really know when it is Opportunity that is knocking. Please bring me a vodka, make it a double. I’d just like to float the idea that we are all Ukrainians now. Whether fascists or commies. Because energy. To mobilize the global fugue of environmentalism it would be fantastic for all of us to go to Ukraine in droves. Who could stop us? We can work in the fields and the farmers’ markets; produce what’s needed in Factories for Ukrainian Sustainability; and live dedicated lives in little mud hovels with scrap tin roofs; poop in buckets and wipe our butts with grass and leaves. And simply bundle up in red-cross rags when the arctic blast hits next winter… a true experiment in our new world realities. But also an experiment in dropping-out and peaceful living. Just be sure not to step in the Yats.

    2. Abe, NYC

      I agree but… the US has been most vocal calling for the sanctions but has shown little willingness to shoulder its share of the burden. The French frigate saga is most egregious. If they do get transferred to Russia that will make a mockery of any notion of unity among the Western countries.

  2. nobody

    “The life expectancy of adult men fell by an unheard of four year during this period.”

    One year less than the drop in life expectancy for “white women” in the US “who didn’t graduate from high school,” and whose “life expectancy has actually dropped by five years — from 78 years in 1990 to 73 in 2008.”

    I wonder whether the drop in life expectancy in the US will rise (or is already rising) up the education ranks as the years go by and similar processes unfold under the guidance of some of the same cast of characters who facilitated the plunder and pillage of the old USSR.

  3. zapster

    For weeks I’ve been asking people “what has Russia been doing that’s so terrible? What *IS* this “Russian aggression” everyone keeps yammering about?” And I’ve been amazed–no one can actually answer that question. I get “well, isn’t it obvious?” or “well they’re controlling the rebels.” And then I ask them what evidence they have that that’s happening. Back around to “obvious.” Or “I can’t believe you don’t know that!” The ad-homs start directly after that.

    The reality is, Russia is not the aggressor. As near as I can tell Putin has been working very hard at normalizing relations with the rest of the world, and very carefully *not* being aggressive or adventuresome. I’m afraid the US has suddenly realized it’s fresh out of boogeymen to terrorize the gullible into feeding the maw of the military-industrial behemoth.

    Putin does have oligarch problems still, and they could be quite disruptive if their deals with Europe come unglued over this, but I have a hunch that Ukraine is going to be facing open revolt across the board long before that comes to pass. Their attempts at conscription are already meeting with open defiance, and soldiers are defecting to Russia at much higher rates than is being reported. Even those that do *not* speak Russian are saying “I don’t hate Russians, what are we doing this for?” I don’t expect our junta to last much longer there, and whoever replaces it will be much less inclined to submit to the IMF. A war is just the thing to get everyone in a fightin’ mood, dontcha know..

    1. Gerldam

      So refreshing (sorry if the word may be inappropriate for such serious business) to read exactly what I have been asking myself for weeks now.
      True, Russia wanted and did get Crimea back, but anyone who knows a bit of history knows that it was Khrushchev who gave Crimea to Ukraine and that before, it had been Russian for at least a couple of centuries. Remember the Crimean war between Russia on one side and the Anglo-French coalition on the other in the XIXth century.
      Now back to present: what proof is there that Russia downed the Malaysian plane? None so far. Obama and Cameron have been yelling that Putin is the bad guy and he should be sanctioned (taking the Russian people with him). Now what right has Obama to punish Russian people? Only the rule of the stongest? The world has not forgotten America lying in front of the world at the UN security council about the non-existant WMD in Irak. Is America lying again? From friends I have who are in Kharkiv right now, I hear that there are plenty of armed guys who speak German, English and other languages there. Are they all Russians? Did the US have absolutely nothing to do with the Maidan revolt? There are too many questions and too few proven and documented answers.
      Finally, since Putin and Lavrov seem people that one can talk to, why don’t all these machos get around a table and hash it out?

    2. Paul

      First, Russia annexed Crimea. I think we can all agree on that. Also, the way they did it is very indicative of the dirty war which Russia is fighting now. Masked men, out of uniform, came descending upon Crimea. Russia insisted at the time that those men were not Russian military, but Russia later on admitted that they were. Among the unidentified troops which descended upon Crimea were special forces, which were identified in photos taken during the war in Georgia. It’s clear that Russia has no qualms about sending special forces into neighboring countries, and without identifying insignia.

      Likewise, in Ukraine, it appears that Russia is not only funding and supplying the rebel troops, but also providing special forces and intelligence. The evidence, taken in its entirety is pretty convincing.

      The rebel successes, particularly early on, were astounding. This is no rag-tag bunch of rabble. They clearly have access to very good intelligence, are well armed and well led. They have executed a number of successful ambushes and shot down a number of Ukrainian military planes, as well as a civilian airliner (the latter which they don’t actually take credit for, for obvious reasons). They had access to sophisticated missile launchers which only Russia or Ukraine could provide. The rebels had captured one or more launchers from a Ukrainian base, but accounts indicated that those launchers were disabled. The missile which shot down MH17 was launched from rebel-held territory. It really cannot have been launched by Ukrainian military forces. Likewise, Ukraine had no use for surface-to-air missiles, given that the rebels have no air force. The rebels, on the other hand, have been shooting Ukrainian military planes out of the sky and taking ample credit for it. Ukraine provided intercepted audio recordings of rebel soldiers discussing the downing of the aircraft before and after realizing it was a civilian airliner. Ukraine also provided photographs of the type of launcher which was used being driven toward the Russian border immediately after the catastrophe. This is completely in line with the rebels, under order from Moscow, trying to hide the evidence of their crime, accident or not.

      The U.S. has provided photographic evidence of rocket launchers in Russia being used to shell Ukrainian military. Notwithstanding the lack of credibility of U.S. intelligence after the UN WMD fiasco, this looks a lot more convincing. For one thing, there are no cartoons in these slides. It’s really incumbent upon Russia to disprove the U.S. claim, which they can easily do by allowing international observers into Russia.

      If you tend to get your news from Russian news sources, such as RT, just be aware that the Russian government has a great deal of control over what is presented there. I suggest checking out and the Moscow Times. These provide an alternative point of view, which you might perhaps be missing.

      1. Abe, NYC

        Not only that. The whole notion that Russia is not doing all it can to support the rebels is ridiculous within Russiaitself . Putin officially denies the support while winking at both the insurgents and Russian public, which would tolerate nothing less. Moreover, as I’ve written previously, terrorists have successfully blackmailed Putin – they issued public appeals of support, which made it impossible for Putin to stop it.

        1. Jackrabbit

          This is what a proxy war looks like. Each side has their ‘reasons’ but outsiders also have an interest.

          As you noted yesterday, an EU-brokered plan for Ukrainian elections was torn up in favor of a coup.

            1. OIFVet

              The Ministry of Truth has imprinted its alternative reality into your subconscious thoughts. This is the final step before they assume total control over you. Seek intervention immediately. “This is your last chance. After this, there is no turning back. You take the blue pill—the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill—you stay in Wonderland, and I show you how deep the rabbit hole goes. Remember, all I’m offering is the truth—nothing more.”

        2. cwaltz

          And? It isn’t like the US didn’t start the proxy fight by sinking billions into the region and backing the anti Russian rhetoric to begin with. Nuland started it, as far as I’m concerned Putin has as much a right to protect Russian interests as the US does to try and further its interests(and in my viewpoint this all about the interests of the US 1% who never have enough of ANYTHING, nothing more.)

          Not only that but I RESENT that my tax dollars went into supporting the anti Russian rhethoric to begin and are presently going to the “new improved” Ukrainian government while the US is busy cry “poverty” and doing everything it can to undermine AMERICAN social safety nets. As far as I’m concerned we have no business in Ukraine. The American oligarchs who want it so badly should go on over there themselves and fund their own little imperialist adventures. Otherwise, for all I care the Russians can have it.

      2. Maju

        Crimea democratically segregated from Ukraine upon the fascist coup (quite wisely and in their full right to self-determination, which all peoples have) and then asked for annexation to Russia as autonomous republic. The legitimacy of that decision is absolutely clear: 95% of the votes with an 81% of participation (!!!) Nobody in Europe really cares about that but we are very worried about fascist death squads returning to our continent, more so when the rise of fascism seems a trend (France, Hungary, Denmark, etc.)

        As for the Novorossiya Federation, which has attempted to do the same, Russia has ignored them almost totally. What is a shame but is exactly what one can expect from the autocratic bourgeois regime of Putin and its objective interests: they do not want to annex many million of revolting workers but rather use them as a pawn to restore a friendly government in Kiev in due time. Only the PCR (main opposition party) has shown some sensibility, as have done many in the European Left (international brigades and such).

        See this for example to understand the Kremlin’s position:

        “The rebel successes, particularly early on, were astounding.”

        There was a power vaccuum: the Nazis had entered the Parliament and “voting” was ridiculously botched (see pictures: , it was a coup and one that was immediately threatening with banning Russian language, as well as most important political parties. As soon as it happened the PCU attempted to organize militias in their stronghold of Zaporozhia. As of today Ukraine still does not have any semblance of legitimate government and huge swathes of the Ukrainian society oppose the regime installed in Kiev, just that with the exception of the secessionist regions they lack effective organization and have seen their political parties (dominant in the last free elections) banned, the media controlled by the Junta and any semblance of democracy disappear.

        Rallies and protests were massive, not just in Donetsk and Luhansk but also in Kharkiv, Odessa and other cities. Just that in those areas the social division was enough for doubt in which course of action to take and to allow for the Nazi repression to reign in.

        “Ukraine also provided photographs of the type of launcher which was used being driven toward the Russian border immediately after the catastrophe.”

        Launcher that was Ukrainian and was in fact near Donetsk, not anywhere near the Russian border.

        “The U.S. has provided photographic evidence of rocket launchers in Russia being used to shell Ukrainian military.”

        Really? Link please. Last time I checked the US acknowledged with small mouth that they did not have any sort of such evidence.

        On the other hand aggressive provocations by the Ukrainian military, bombing Russian villages and other areas, have happened several times. It is obvious that Kiev wants to escalate the war because otherwise it fears to lose it (it’s very plausible that disgruntled officers stage a counter-coup any day – most Ukrainians feel no sympathy whatsoever for the Banderist minority that runs the show).

        “If you tend to get your news from Russian news sources, such as RT, just be aware that the Russian government has a great deal of control over what is presented there.”

        Naturally, as does Washington over mainstream Western media. Curiously Russian media is often (not always) much less informative about Ukraine than independent sources based in the West, such as blogs and alternative media. Russian media seldom echoes, if at all, the deep political issues such as the antifascist struggle or the collectivization of Donbass industry or the illegalization and persecution of every Left-wing organization and people in Ukraine. They do not because Russia is, like the USA, a reactionary power and, if they are confronted, they are not on the deep issues. The Kremlin would not care if the fascists run the show in Kiev, except for the little issue that they are doing it in behalf of NATO (what makes the Ukrainian conflict akin to the Cuban Missiles Crisis, because Kiev is way too close to Moscow).

        So there are at least three sides here: (1) Washington (incl. Nuland’s Junta in Kiev), (2) Moscow and (3) the freedom fighters of Eastern Ukraine, who are fighting desperately and with nearly zero external support against Fascism.

    3. Paul

      Also, I still see people describing the democratically elected government of Ukraine as a junta. Can anyone care to explain why that is?

      Yes, there was a revolution in Ukraine, but it was followed by a democratic election.

      I believe people became enamored with the descriptive “junta”, because RT used it in their coverage, but I thought even RT stopped using that term.

      1. bluntobj

        Because the previous guy had been democratically elected? That tends to cast suspicion on the people doing the revolution and the others they install.

        Not to mention in your previous post you state that you consider Crimea an “annexation” by Russia, not a “voted upon by 97% of the voters to choose what country to belong to” action.

        If you can give the stamp of legitimacy to a junta of ultra right wing nationalists that depose an existing government, then install a sympathetic candidate in a vote, then you must grant the right of Crimea to vote to join Russia. Or the rights of voters in eastern Ukraine to determine their own futures.

        Having it both ways and rationalizing it tends to be the sign of an American mind. It’s sad that that term can be pejorative nowadays.

        Not to mention that the evidence you present about MH17 is less than credible, and consists of assertions for which little evidence beyond doctored social media postings exist. There’s a degree of unreality in the world when information presented by Russia is more credible than that presented by the US…

        1. Abe, NYC

          “voted upon by 97% of the voters to choose what country to belong to”

          in a monkey referendum held under the barrel of a gun and boycotted by a very significant portion of the population including all Ukrainian and Tartars.

          I heard Kim Jong Un received 98% of the vote, which was about just as legitimate.

          1. Jackrabbit

            Didn’t Saddam routinely get over 90% of the vote? And he was a key ally. Until he wasn’t.

          2. bluntobj


            Pot meet kettle.

            The election of the new Ukrainian government, before it collapsed, was no different.

            Which was my point, incidentally. If you are mocking one side’s election and making the mental leap that the elections in Kiev had any more validity when they were “held under the barrel of a gun and boycotted by a very significant portion of the population”, well, do I need to say more?

            I find the arrogance of Americans quite amazing when elections go the opposite direction than the USSA desires. But hey, democracy, right? Free determination, right?

            Oh, and you might find that the internet has differing opinions on your statement:
            “in a monkey referendum held under the barrel of a gun and boycotted by a very significant portion of the population including all Ukrainian and Tartars.”

            Try this:

            Please stop spewing western media propaganda.

            1. Abe, NYC


              Let’s turn to the web site of Russia’s Presidential Council on Civil Society and Human Rights, which says:

              По мнению практически всех опрошенных специалистов и граждан:
              – подавляющее большинство жителей Севастополя проголосовали на референдуме за присоединение к России (явка 50-80 %), в Крыму по разным данным за присоединение к России проголосовали 50-60 % избирателей при общей явке в 30-50 %;

              Which Washington Post correctly translated as:

              In the opinion of virtually all the experts and citizens interviewed:
              – The vast majority of the citizens of Sevastopol voted in favor of unification with Russia in the referendum (50-80%); in Crimea, various data show that 50-60% voted for unification with Russia, with a turnout of 30-50%.

              Do try to use other sources than official propaganda, whether Russian or American.

              1. bluntobj


                “However, in the last six months, seventeen of the most respected and outspoken members of the Russian democracy movement have quit the Council, including Liudmila Alexeeva, Gannushkina, and Dmitry Oreshkin. Two main reasons have been given: eleven members left as Putin returned to the Presidency, stating that it would be hypocritical to advise that same person against whom they organise in the opposition movement.”

                I will leave the reader to judge how sharp the axe is ground…

                Abe, I also do not discount what you have posted. It may be indeed true. Or, given that it appears that many members of the council are in opposition to Putin, it may be that is report is deliberately low.

                Which may make the report official propaganda…of the Russian opposition movement.

                Perhaps we should simply stop using declarative statements about the truth of russian/ukrainian events without credible evidence? We can see how well that went over in Iraq, Syria, Afghanistan, Egypt, Libya, etc. I’d prefer to not be maneuvered into war based on someone’s propaganda.

                1. Abe, NYC

                  Well yes. What the actual turnout was, is impossible to establish without running a proper survey. But 3 months after the referendum, Russia has still failed to find enough quislings among the Tartars to conjure a semblance of significant support, while their acknowledged and respected leaders have been barred from entering Crimea. That is saying something about the Tartars’ voting preferences.

                  But that the referendum was rushed, held by an occupation force, not preceded by anything remotely resembling due democratic process, is hardly in dispute. That by itself is enough to undermine its legitimacy.

                  1. bluntobj

                    I’m glad we circled back to the main point:

                    “But that the referendum was rushed, held by an occupation force, not preceded by anything remotely resembling due democratic process, is hardly in dispute. That by itself is enough to undermine its legitimacy.”

                    Like the election of the “official” government in Kiev.

                    Which, if you look through what I posted, was my point. If you call out the one hand for being illegitimate, and the one you favor as legitimate, you had better be sure that Jimmy Carter would certify it himself.

                    That ain’t the case, as I pointed out.

                    All of which boils down to the question:

                    Why is Obama spoiling to start a WW3 with the Russians, and willing to use whatever means is necessary, like revolutions, rigged elections, civil wars, etc. to do so? Have we not seen this play enacted all throughout the middle east?

                    All I really would care for you to see, Abe, is that in a mudfight everyone is dirty, and Ukraine is a mudfight between the USSA and Russia. Unlike all the other mudfights the USSA has sponsored in the last decade and a half, this is the first one with an opponent armed with thermonuclear weapons. That alone should make you cast a highly cynical eye at anything the USSA proclaims as “True” in this conflict.

  4. YY

    25%-33% is of energy requirement is not insignificant nor easily made up from other suppliers. In taking this into calculation Europeans need not worry they are trading practical needs with morality/ethics. Contrary to the propaganda and prejudice presented daily, in which everyone gets swept away, even asking one simple question should resolve what actually happened.

    If the rebels or the Russians were responsible for the downing of MH17, why would the rebels have given up the black (which we all know is orange) boxes so promptly early in the game. One would think a guilty party would have destroyed or thrown in a deep well the boxes which would have given dimensions to the crime.
    And all the bleating about tainting the evidence is BS as well.

    1. shinola

      Any controversy over the black boxes is just noise. Want to know what they will show?

      They will indicate everything was AOK and suddenly there was catastrophic failure in all systems.
      No way can black box info. indicate who the rocket that brought down the plane belonged to.

      1. bluntobj

        And what of the cockpit voice recorder? The one that would tell of the flights routing to the north by Kiev air control, and of the ordered descent to SAM range that was (reportedly) strenuously objected to by the pilots?

        I would like to know the contents of that one…

    2. jgordon

      Well in the not too distant future all of humanity will either have the option of cutting our profligate wasting of energy by about 90%, or of 100%. Depending on when, how, or if we choose to go about it. So another way of saying it is that the Ukrainians will be getting a slight head start on the rest of us.

  5. Jesper

    The finance-industry will do anything and everything to stop sanctions that might affect bonuses in the finance-industry. So I’d expect that the media-campaign demonising the Russians while arguing for sanctions will soften.

    If there would be a softening then I’d expect it would start with less media-focus on the issue in the expectation that people will forget the message over time. Followed by a subtle change of message until the message has been changed completely. I think the media-campaign has softened already, others might have a different opinion/experience of that.

    We’re not yet ready for an Orwellian overnight change in media-message.

    & no matter who supplies Ukraine with gas will have to decide on the price and credit risk. Not sure many western companies would, even if they could, supply Ukraine with gas on credit. Focusing on how gas could be supplied technically is interesting but if the customer can’t pay then it is unlikely that it will get done.

    1. Banger

      One of the essential tensions within the Deep State I that between Wall Street/City and the National Security State–once joined at the hip they are now at odds in some ways. The hot/cold reaction to events in Ukraine shows this tension rather dramatically. One day the media dreams for blood the next they focus on some trivial issue seemingly without rhyme or reason. As I’ve said before I believe there are some major power struggles under the surface and more than two factions are involved–this is the reason for what appears to be a stalemate in Washington which has virtually nothing to do with the RP or DP. Even the mainstream, for example, is largely ignoring the upcoming mid-terms.

      1. Jackrabbit

        “. . . without rhyme or reason.”

        Well, there is often some rhyme and reason. After any event, the coverage is almost totally one-sided and sensational so the public gets a good dose of propaganda. This is later excused as not all the facts have been in, fog of war, the commercial imperative, etc. Then something of a ‘debate’ is conducted in the back pages. Often the opinions that are counter to the ‘official story’ are just nitpicking or clarifying but not really challenging -OR- presented by an establishment person representing an opposing mainstream political faction and the audience assimilates/dismisses the points into their understanding of accepted mainstream politics. Yet there are times when we get good reporting and questioning, such as the following from yesterday’s links: Could Barack Obama Have Prevented the MH-17 Disaster? Is this an example of simple journalism/opinion or does it represent a ‘Deep State’ debate? I don’t know. After all, news publishers have to show SOME amount of independence and thoughtfulness or they will be accused of just being propaganda organs.

        H O P

        1. NotTimothyGeithner

          But the news organs are for profit and dominated by mbas which means anything seen by an meat-eating as unnecessary will be cut in an Era of declining viewership which means the reliance on government spin doctors. Two, mbas are a self selective group by their very nature and will demand news be filtered through that. Three, they don’t want controversy from their hosts, writers, presenters because they fear backlash and a drop in viewers, so conventional wisdom becomes the order of the day.

          There is no need for conspiracy, just the trajectory of corporate America applying to this set of for-profit companies. They can’t risk losing the big gets by printing stories. The tabloids carried Bill’s extramarital activities not the nightly news, even if they did have the goods because the outlet that hit Bill, hypothetically, would be blacklisted. Stephen Colbert’s “Better Know a District” sketch was stopped because Pelosi forbid her members to participate, so they wouldn’t look like fools. Pelosi is unaware of the concept of irony.

          There is the trickle-down effect of reduced competitors in the newspaper market. Even the cable news each has their own niche: fox-republicans, msnbc-democrats, cnn-the brain dead, and they aren’t trying to beat each other as much as they are trying to inflate the egos of their separate viewing groups.

      2. Abe, NYC

        Good observation. Add to it the oil industry, which is dreaming of replacing Russian gas with its own shale.

  6. diptherio

    If there’s one thing history has taught us about Russians, it’s that they are easily conquered and have little tolerance for discomfort….

    1. Abe, NYC

      Russians have incredible capacity for survival. But I wonder how willing they really are now to sacrifice their BMWs and iPhones and credit cards and go back to shortages of bread, meat, toilet paper, and pretty much everything else, so characteristic of 1970s/80s.

      1. OIFVet

        Ah yes, consumerism as the great Trojan horse of imperialism. Except softness fits Americans much better. The average Russian ain’t driving a Beemer, that’s the nouveau riche liberal bourgeois and the oligarchs it serves, plus the gangsters. For sure the liberal fifth column would be loath to give up the fruits of their looting of the state in the 1990’s. They will be easily persuaded when the unwashed Russian masses that you so despise apply a bit of coercive persuasion. For all of your self-proclaimed expertise on all things Russia, it is obvious that you do not understand the eastern and southern Slav mindset. Which is why you and yours are playing with fire.

      2. Yves Smith Post author

        Putin’s base of support isn’t the oligarchs (he went after them, remember?) and he is no longer popular with the urban intelligensia. His base of support is what Mark Ames calls Russia’s version of Nixon’s silent majority: middle and lower class people, mainly outside Moscow.

        1. Abe, NYC

          Mark Ames’s analysis was brilliant but there’s more to it than that. Three generations of Russians and other peoples of the USSR have been demanded to sacrifice their labor, property, and lives supposedly for the greater good of the state, the world, and freedom (and in reality, to satisfy the ambitions of a tiny elite). Another generation was caught in the collapse of an empire and deprived of whatever opportunities their parents had. Now, for the first time in at least a hundred years, even outside Moscow a majority of Russians can have a decent standard of living and afford small luxuries taken for granted in the West: an iPhone for teenage daughter, an inexpensive car, a nice TV as a birthday gift. Have they learned to value this way of life? Right now the Russians are united behind a Great Leader once again, but without a constant stream of supposed external threats this support may not last. It’s hard to know the answer, so far the elite has proved exceptionally competent at shaping the public opinion but “you cannot fool all of the people all of the time.”

          1. OIFVet

            Wait, I thought it was about a Beemer in every driveway and iPhone in every pocket, now it is about an inexpensive car and the occasional daughter with an iPhone. Ratcheting down expectations now, are we? How rude. Besides, Moskviches, Ladas, and Zhigulies were inexpensive and ubiquitous back then, my dad had an old Moskvich before splturging on a brand-new Lada 2007. Didn’t give me an iPhone though, they didn’t yet exist. Anyway, Russians do remember the 1990’s too, and they know who looted what they built together and who came close to destroying Russia. They also remember who raised their standard of living since 1999 and who saved Russia. You think a fucking TV matters more to the common Russian than Mother Russia? I told you, you don’t know the Slavic mindset.

            1. Abe, NYC

              Read my post again. And if you think Russian-made cars were “ubiquitous and inexpensive”, you don’t know anything about life in the Soviet Union even though you have apparently swallowed its leaders’ speeches whole.

              1. OIFVet

                I did. I stand by what I said. Bulgaria wasn’t rich you know, if anything it is even poorer now that EU membership destroyed local manufacturing and agriculture. Most people had these “rare” and “expensive” Russian cars. My town was known for its production of TVs, both for the domestic market and for export to COMECON. It also produced a full line of kitchen appliances. Every home had them. Computers ‘Pravetz’ were produced elsewhere in BG, most schools had a computer lab in the 1980’s equipped with these, and large part of the production was exported into the Soviet Union. I spent a month in Poltava in 1987 as part of a sister cities exchange program, and even in crappy Ukraine the schools had computer labs equipped with these Pravetz machines. Little wonder that Bulgarians and Russians were early and prolific source of computer viruses. The consumer landscape in the former Soviet Union and Soviet Block was never anywhere the desert you would have people believe it was, not-so-honest Abe.

                Coincidentally, all these factories in my town are now closed, and the Bulgarian electronics and consumer appliance industries destroyed. EU membership is the gift that keeps on giving…

                1. Abe, NYC

                  I cannot say anything about Bulgaria, which I have never visited. In Eastern Europe the standard of living was higher, except Albania and Romania. In the USSR itself, even when life got much better after the war cars were far less ubiquitous and affordable than Beemers today. People saved up for years, and stayed on waiting lists for years, to buy a car at list price, while resale prices were 3-4 times the list price. A car (any car), a video player, an imported TV – geez, even a pair of Levi 501’s – was seen as a status symbol, which only few could afford. Then around 1975-80 shortages gradually started, then rationing in many parts of the USSR. Only Moscow was well supplied.

                  In short, the great majority of people never had anything remotely approaching the West European standard of living while now it’s much closer.

                  1. OIFVet

                    Affordable beemers? If BG is any guide, you refer to junker cars taken out of the German salvage yards to fart pollution all over Eastern Europe, and sold at far above book value to broke easterners who can’t afford something better. In essence we imported the sleazy used car dealer archetype too. It’s a perfect symbol of our “progress”, I will give you that.

                    And the imported goods mania to affirm one’s status in the hierarchy of middle class communist bourgeois? Keeping up with the Joneses, Russkie style. What, you thought VCRs in the West were cheap and affordable in the late -70’s – early -80’s? You can be so adorable sometimes! My family kept up with the Joneses too, better than most. All it did is get me access to such classic movies as ‘America 3000’, my first introduction to Femdom fantasies. Very formative experience for an 11 year old with early-onset puberty.

                    1. Abe, NYC

                      I thought I was clear: In the Soviet Union, Ladas and other Russian cars were far less ubiquitous and affordable than BMWs in today’s Russia.

                      As for the rest, that’s the thing: what was a minor purchase for a German or American, was unaffordable luxury for most Soviet citizens.

                      If you really want to know, my own disillusionment with Communism started when I saw a TV story from Poland (of all places) in 1987. They showed a computer store, an Atari 65 and its price, US $125. I was shocked: my uncle had one, and it cost 3,000 rubles – a very nice annual salary in most parts of the USSR. I couldn’t believe Westerners could obviously so easily afford a computer, which for me was an unattainable dream. And I seriously thought for the first time that there must be something wrong with a system that produces such outcomes.

                    2. OIFVet

                      Non-sense all around. Car ownership was iniquitous. As for the price of your uncle’s Atari, blame import duties as supply obviously wasn’t an issue. And your uncle’s common sense in dropping a year’s salary on one. Wanna talk about bad systems? Talk about the system that imposes a crushing debt on college students before they even turn 20, and the system that results in people going bankrupt as result of an illness. I seem to recall college education and health care being free for all in that evil Soviet Block

                    3. OIFVet

                      Repeating things over and over again will not make them true, at least not here. I know enough about the SU, and what’s more I don’t have hatred to warp my views and my memories. You do. Everything you put forth is infused with hatred. Wherever you are from, get over it, it is not healthy way to live life. BG was under brutal Ottoman rule for five centuries and I don’t hate turks for it. You pussies are bitching and moaning over 70 years of Soviet rule.

          2. Jackrabbit

            Even the West gets its consumer goods from China, so I doubt that Russian’s will have to do without as much as you think.

            1. Abe, NYC

              True. But it’s not just about availability, it’s also about affordability. A retreat into isolation would hit the economy very hard, import prices would skyrocket which would cause a massive rise in inflation. It’s almost indecent to mention inflation in the US now but in those parts of the world the dynamic is quite different, inflation has stayed extremely high in 1990s and very high through recent years, and would skyrocket if the exchange rate nosedives.

              Of course, in 1998 a collapse of ruble exchange rate was a short-term disaster but a blessing even at medium term: import substitution industries immediately sprang up and the economy embarked on a rapid 10-year expansion. This would alleviate the negative effects somewhat but today the Russian economy is far more dependent on both technology imports and export revenues.

              1. fff

                I study the FSU as a hobby. You’re description is not accurate until the late Gorby period. In FSU, basics were highly subsidized, e.g. 20 ruble/month rent, 20 kopek bread loaves, etc. To balance out the subsidization, cars and washing machine prices were relatively high. This was considered the only to capture excess income in the days before complete computerization of inventory and delivery used today by Walmart. GDR had 50 percent car ownership. FSU has 90 percent plus TV/radio, 80 percent telephone ownership. Camcorders, microwaves were rarer but available…Quality is another story, though still higher than the third world. Many economists blame the quality issue on quantitative measures and politically diverted resources to the military.

                1. Abe, NYC

                  A color TV was a luxury item through early-mid 1980s. The price was about 600-700 rubles, or at least 2-3 month average salary (which varied widely depending on the region); an entry-level engineer could earn around 120-150 rubles although this again varied between regions.

                  90%+ TV/radio ownership seems right, 80% telephone ownership extremely unrealistic, in most places people had to wait for years to get a telephone line into 1990s. I don’t know about GDR car ownership rates but I’d be surprised if in the USSR it was as high as 5%.

            2. cwaltz

              I suspect China is laughing its ass off at us. Let’s see, it benefitted from our liitle Iraqi adventure and now it looks like our Ukrainian adventure will be lucrative too.

  7. Jose

    One practical consequence in the realistic scenario described by Münchau – suspension of payments in an all-out financial “war” against Russia – is a selective default by the West on the part of its debt held by Russia.

    This will create a very dangerous precedent for investors in government debt issued by developed countries, who buy that debt because they see it as being “risk-free” – a cornerstone for the pricing of all financial products.

    The US and the EU should thus think twice before taking steps that may undermine even more the already battered levels of trust in the international financial system.

  8. Ignim Brites

    Far from talking about imposing sanctions, European policy makers (and US too for that matter) should be defending the right of eastern Ukrainian provinces to secede. Now whether they have a right to secede to join Russia is another question. On democratic principles, one would have to say yes. But then one would have to concede that LA County has a right to join Mexico.

    1. Lexington

      Far from talking about imposing sanctions, European policy makers (and US too for that matter) should be defending the right of eastern Ukrainian provinces to secede

      Yeah, just like when the Confederacy seceded Abe sent them a fruit basket and a case of Kentucky bourbon as a good will gesture, instead of like you know, inaugurating the bloodiest war in American history.

      I have to say that when it comes to “WTF?!” moments commentary on the Ukrainian crisis is the gift that just keeps on giving.

      1. Ignim Brites

        So if Andrew Cuomo decides to lead New York to independence (or even a new union with Ontario), after the 2016 election, you would be fine with the government in DC launching a full scale invasion possibly including the use of tactical nuclear weapons? Thankfully the vast majority of Americans would concede, when push comes to shove, the right of New Yorkers to secede.

        1. Lexington

          Just for the record, has the Ukrainian government actually used tactical nuclear weapons, or even threatened their use, or is that just a straw man argument?

          As for this:

          Thankfully the vast majority of Americans would concede, when push comes to shove, the right of New Yorkers to secede.

          First of all the historical record does not endorse this expectation.

          Second, the first duty of any government is to preserve the territorial integrity of the state over which it claims sovereignty. The failure of the government to perform this most necessary of tasks usually results in a fatal loss of legitimacy both among its peers in the international community and among its own citizens, since maintaining a monopoly of force within its borders and preserving the sanctity of those borders is exactly what defines the legitimacy of any government’s claim to sovereignty. For this reason no Ukrainian government could tolerate an armed insurrection by disaffected elements of its own population, aided and abetted by a foreign power, or accept the extra constitutional alteration of its borders or the unilateral imposition of alterations to the terms of its political order, both of which have been demanded by both the separatists and their Russian allies, any more than Lincoln could acquiesce in the secession of the southern states.

          Many people in the West seem to labour under the delusion that their personal feelings about the legitimacy of the regime in Kiev is somehow relevant to evaluating that regime’s actions, which is obviously nonsense. To the extent that the highest imperative of any government is to preserve the integrity of the state over which it presides then any government that fails in this imperative will be judged by history to have been deserving of its fate, regardless of whether it was headed by Mother Theresa or Genghis Khan.

          1. fff

            I think relevancy has much to do with it. If a right-wing regime was installed by foreign agents in NY, I would very much want Washington to intercede. However, if Washington was coopted and replaced by a malevolent foreign power, with pretensions of conservative traitorous power, I would be fighting in NY to succeed.

      2. Brian M

        Given that the Civil War led to generations of Jim Crow, along with dominance of the United States by Southern politicians (and increasingly corporate dominance as companies fled the North)

        Given that Licnoln’s nationalism facilitated the growth in power of national capitalist organizations.

        Given the 600,000 dead….I think one can at leat ARGUE that this was a mistake.

        Besides, this is a feeble analogy. A re you claiming that Russia is the slaveowning South and Ukraine the vector of Freedom? Really?

        1. cwaltz

          I’m glad someone else said it. The War between the States was about freedom alright. It was about the freedom of one person to own another person. It was about a bunch of Southern babies who couldn’t abide the idea of not having free labor(and according to bumper stickers and their hideous record when it comes to workers rights it hasn’t changed much) Last I saw the rebels weren’t out to opress the folks who don’t want to be part of Russia.

        2. Lexington

          Besides, this is a feeble analogy. A re you claiming that Russia is the slaveholding South and Ukraine the vector of Freedom? Really?

          No, I’m not claiming that – either for 1861 or for 2014. Abraham Lincoln didn’t go to war to abolish slavery, he did it to preserve the integrity of the United States – and he stated this very carefully and explicitly many times during the secession crisis and after. He only embraced abolitionism in 1863 as a means to reignite support for the war in the north after hopes for an early victory and reconciliation had been dashed and morale in the Union had been sapped by a string of defeats in the principal theatre of war.

          Beyond that I went to some length to explain the parallels I do see between the situations respectively confronted by the government of the United States in 1861 and that of the Ukraine today in my previous post.

          Naturally I understand that many Americans take it for granted that the US is special and that considerations that could legitimately be allowed to the Great Emancipator couldn’t possibly apply equally to neo Nazi foreigners who are an affront to every sacred value a provident and beneficent America has blessed on humanity.

          1. cwaltz

            Uh- and pray tell why was it again that the south seceded? Oh that’s right it seceded because it was pissed off about the loss of support for slavery.

            Here’s an excerpt from Georgia’s secession:

            For the last ten years we have had numerous and serious causes of complaint against our non-slave-holding confederate States with reference to the subject of African slavery. They have endeavored to weaken our security, to disturb our domestic peace and tranquility, and persistently refused to comply with their express constitutional obligations to us in reference to that property, and by the use of their power in the Federal Government have striven to deprive us of an equal enjoyment of the common Territories of the Republic.

            Here’s Mississippi’s
            Our position is thoroughly identified with the institution of slavery– the greatest material interest of the world. Its labor supplies the product which constitutes by far the largest and most important portions of commerce of the earth. These products are peculiar to the climate verging on the tropical regions, and by an imperious law of nature, none but the black race can bear exposure to the tropical sun. These products have become necessities of the world, and a blow at slavery is a blow at commerce and civilization. That blow has been long aimed at the institution, and was at the point of reaching its consummation. There was no choice left us but submission to the mandates of abolition, or a dissolution of the Union, whose principles had been subverted to work out our ruin.

            I can pull up the other sites where they essentially cite their reasons for seceding but I assure you SLAVERY, or their belief in the right to own another human being was the motivation behind their secession. While Abraham Lincoln’s primary motive may have been to preserve the Union. The South’s primary motive was because they were angry little children aggravated that the North wasn’t playing by their rules and was emancipating fugitive slaves once they managed to escape to the North.

            So don’t BS me about the war.

            1. Lexington

              Who is BSing whom about the war here?

              I didn’t deny that slavery was the main motivation for southern secession, I denied that Lincoln went to war in 1861 with the explicit intent of abolishing slavery. Lincoln and the Republicans were committed to that goal in the long term (the Republicans split from the long impotent Whigs over the latter’s unwillingness to embrace abolitionism), but in 1861 Lincoln would have happily accepted the continuation of slavery in the south for an indefinite period of time (but importantly not in new states admitted to the union as the US expanded westward) if it would mean the rapid reintegration of the south into the United States. He therefore resisted openly embracing abolitionism early in the war because he recognized it would make it politically impossible for the Confederacy to accept reintegration and that the war would therefore be a fight to the death – which in the event it literally was.

              The historiography of the war I’m presenting here is textbook. The fact you don’t seem aware if it suggests you need to brush up on your civil war history before accusing anyone of BS.

              1. cwaltz

                Can you remind me again who fired first? Hint: It wasn’t Lincoln. When Lincoln fired back he was DEFENDING Fort Sumpter. He didn’t start the war, he merely ended it.
                Furthermore, one of the things Lincoln ran upon in 1860 was stopping the expansion of slavery which is WHY the states in question seceded.
                So yes, it’s BS to pretend that the war wasn’t about slavery when it was exactly about slavery. You act as if Lincoln’s motivations are the only ones that mattered by the way. Wars have 2 sides(and often more than one motivation). Your commentary makes me question whether or not you’ve even tried to look at Ukraine as anything other than one dimensional. You certainly don’t seem to have a good grasp on the Civil War since according to your commentary anything other than bourbon and fruit basket wasn’t a gesture of good will(again, the first shots were fired by the South, not the Union who’d withheld fire up to that point.)

                You are the one who needs to brush up on his civil war history instead of pretending that Lincoln had no opinion on the subject. He did. It was his opinion and the opinion of the then Republican party that precipitated the secession to begin with. And YES, the war was about slavery, so spare me the southern revisionist history where it was all about freedom or states rights or other bullshit.

                As for Ukraine, it wasn’t until after the Maidan party seized power illegally when there became a vacumm that all of this came about. We can talk all we want about the “legitimate” election that occured after the fact but the reality is that for a period of time the party in power seized power and weren’t democratically elected. Additionally, unlike the North and the South’s argument, Ukraine’s situation has our dirty little fingers all over it. Remind me again, which countries “financed” the Southern rebellion against the North? Oh that’s right, the closest thing you have to our multi billion dollar “democratic push” was the Cotton bonds that the South sold AFTER(not before) their secessation. So, no Ukraine isn’t anywhere near the Civil War which didn’t have the greedy mitts of outside countries fueling the agression.

    2. NotTimothyGeithner

      First, secession is illegal by the laws of nature, whatever Jefferson called it. Don’t wander off.

      The Southeast of Ukraine did not secede in any way. When the Kiev junta took power without adhering to the constitutional order, they didn’t remove a madman, he was very good, the state of Ukraine ceased to exist. Since then there have been two separate regional elections which have es tab listed two separate entities. The Kiev regime is an invader. The election in Kiev if it wasn’t rigged did make Poroshenko the legit leader of the new Kiev based country.

      The 13 colonies didn’t secede from the UK. The colonial charters predate the Act of Union and t he Glorious Revolution and established the monarch and colonial assemblies as the legitimate governing bodies. The Declaration of Independence refrains from naming the UK Parliament and refers to unnamed invaders undertaking the same actions as the Parliament. Two, the Declaration accuses George III of dereliction of his duty and announces the metaphorical trial and execution of George III, and the night of the 4th, George III’s prominent statue was pulled down and destroyed. Killing kings is just tradition. We just chose not to replace George III.

      The Kiev regime more closely resembles the American Confederacy. One population didn’t like the outcome of the election, chased the old government out subverting constitutional measures, and made war thus seceding from the old state. If the ousted PM had maintained a government, they would have an obligation to recon queries Kiev, but the NovoRussyia entity because they held elections in absence of the former united state government only has a right to defend it’s borders.

      1. Brian M

        In what way other than your tortured analogy does the Kiev regime resemble the Confederacy?

        Neither side should use this analogy. The Civil War was primarily about The Peculiar Institution, revisionists and Old Dixie apologists be damned.

        1. hunkerdown

          Yeah yeah, every war is about some humanitarian thing or other on the surface. The salient point is that two contiguous nations made a pact that stopped working out. One wanted to go its separate way, the other acted like the crazy homicidal boyfriend and wouldn’t let ’em. You seem to be awfully invested in obscuring the commonalities; why is that?

        1. Ignim Brites

          And are New York’s public intellectuals today preparing the ground for secession if the Republicans seize control of all three branches in 2016?

      2. Lambert Strether

        I like the idea that the American Revolution was really a Civil War within the English-speaking peoples, and the Civil war was the real revolution, because it was a war to the death between two economic systems: slavery and wage labor. IIRC, the capital invested in slaves by the slave power was immense; as great as the capital invested in industrial organization by the North. The South was also globalized and optimized for export (why the railroad network didn’t work very well for internal communication; it wasn’t designed to.)

        1. cwaltz

          The bigger difference being that the action between the North and the South wasn’t percipitated by another country pouring billions of dollars into the South’s pique. Ukraine is a proxy war between Russian oligarchs and Western oligarchs that really could care less about Ukraine for anything other than looting it’s resources. I could understand comparisons to Ukraine’s “civil war” if there was evidence that the South’s irritation was caused by influences other than its own people at the fact that slavery was being manuevered into extinction. That’s not the case though.

          The only thing they have in common, and I’d argue most wars have this as a motivation, is MONEY or assets that can be liquidated into money are being fought over.

      3. Lexington

        I’m afraid I’m not familiar with the “laws of nature” as it pertains to secession. Could you please provide a link to the legal theory underlying this novel innovation?

        Your second paragraph is utter nonsense. Viktor Yanukovych was deposed in accordance with a provision in the Ukrainian constitution that the prime minister can be impeached by a vote with the support of 75% of parliamentarians. No competent court has found this action unconstitutional. The idea that the “state of Ukraine ceased to exist” is similarly outlandish, since the Poroshenko government in Kiev is recognized by the international community as the government of such a state, including by Russia.

        As for the referendums, these were conducted without the consent of the central government or external oversight and were marred by rampant irregularities. It’s interesting how so many people fly into high dudgeon at the slightest hint of constitutional irregularity in Kiev but are extremely indulgent to blatantly unconstitutional actions like sham “referendums” conducted by armed insurrectionists with whom they sympathize.

        Also, the idea that the Ukraine can “invade” territory that is within it’s internationally recognized borders is self evidently absurd.

        If nothing else the Ukrainian crisis has demonstrated how easily supposedly rational people can invent novel legal doctrines at the drop of the hat, engage in blatant hypocrisy, and advance all manner of specious reasoning to justify their prejudices. And then we wonder why democracy is in the state that it is.

        1. NotTimothyGeithner

          If you aren’t an American, it’s explicitly referred to in the first line of the Declaration of Independence, and if you are an American, you should be embarrassed by not recognizing the phrase. The three smartest on the continent didn’t pick pretty words.

          Two, 338 votes are needed for impeachment under the Ukraine Constitution, not the 323 they had. Try again.

          1. Lexington

            If you aren’t an American, it’s explicitly referred to in the first line of the Declaration of Independence, and if you are an American, you should be embarrassed by not recognizing the phrase. The three smartest on the continent didn’t pick pretty words.

            Oh but they did – mostly from Jean Jacques Rousseau’s The Social Contract, which laid out the theory for popular sovereignty which Thomas Jefferson subsequently plagiarized.

            All of which is entirely irrelevant, unless you’re prepared to argue that the Ukrainian separatists are basing their claims on the Declaration of Independence.

            Two, 338 votes are needed for impeachment under the Ukraine Constitution, not the 323 they had. Try again.

            Yeah, they only had 73% of the vote instead of 75%. That’s as good a reason as any to declare that a country has ceased to exist.

            While that might cast some doubt on whether Yanukovych’s ouster was technically constitutional it hasn’t been challenged by any constituency in the Ukraine that I’m aware of. Ukrainians themselves seem far more concerned with maintaining their country’s territorial integrity than with debating esoteric constitutional points in the midst of a national crisis.

            It’s remarkable how many Westerners, many of whom could barely find the Ukraine on a map a few weeks ago, now talk as if they know the Ukrainian constitution, Ukrainian politics and Ukrainian interests better than actual Ukrainians, and feel competent to dispense all sorts of gratuitous advice, much of which is some variation of the theme that Ukrainians should just give the separatists whatever they want. I don’t pretend to fully understand the epidemic of Russophilia that has broken out, but it seems to be based on something like the following rationalization: since Ukrainian nationalists are fascist patsies of global neoliberalism -which I believe because I learned everything I know about the place from Fox News Moon of Alabama and Vineland of the Saker – their enemies must be my friends.

            It’s reductionist and trite, but it has the virtue of reducing a complex situation to memes that can be readily assimilated by the intellectually unambitious.

  9. vlade

    I saw estimates of one in five of German business being (directly or indirectly) impacted by any significant sanctions on Russia. But then, I also saw a story about a Siemens exec complaining at a party about it with a US politico saying “so how much business do you do in US compared to Russia?” (20% vs 5% as it turned out), with the silent implication that they should consider who’s the more important party to them.

    I’d be careful with the meme “Russians have remarkable capacity to take pain”. In my experience, the amount of pain is related to what can you expect from normal life. If your life was getting massively better, and you take hit, you tend to be rather upset (rather than suffer for patriotic reasons). Of course, the upset could be as good for Putin as anything, maybe even better.

    Ukraine will sipon gas, that’s almost certain. The only big question is, how much will EU (or US) be willing to subsidise it (if at all). If they want a reasonably friendly gov’t there, they will have to, that goes w/o question.

    1. Synopticist

      Europe won’t subsidise a d*mned thing coming out of Ukraine. Fancy being the Spanish or Italian president and explaining to your people why we need to pay extra taxes so the Ukis don’t freeze, but your pensions have to shrink?

    2. EmilianoZ

      20% vs 5%

      The rates of growth should also be taken into account. It could be 5% and growing fast and 20% and going the other way. Surely the Gers practice long term planning.

    3. NotTimothyGeithner

      The other part is input. The tires on my car are more important than a myriad of gadgets and cup holders. Without the 5%, Germany’s factories might not turn on.

  10. madisolation

    Pepe Escobar is right:

    “The real, no-holds-barred reason for the Empire of Chaos’s obsessive economic war on Russia is that Moscow, as a BRICS member, alongside especially China and Brazil, is at the leading edge of emerging powers challenging the global financial/political (dis)order – wallowing in the mire of casino capitalism – dictated by the Empire of Chaos.”
    Please read his most recent column:

    In addition, the Ukrainian parliament has rejected the U.S./EU gas deal that would have allowed them to buy up to 49% of Naftogas. That’s why Yatsenuk got out of Dodge.
    The population is going to be hungry come winter, and the IMF has no interest in helping them. The Ukrainian military is hungry right now.
    I give Poroshenko less than six months before he follows in Yatsenuk’s footsteps.

      1. madisolation

        Thank you. I appreciate it. It’s hard to know how to filter and process information these days.

  11. Andrew

    I suspect the EU will follow US dictates regarding Russian sanctions. The argument that the EU will be harmed by sanctions should matter, but I doubt it really does to policy makers. If hurting the EU’s or individual countries’ GDP were primary concerns, clearly banking and macroeconomic policies would have been quire different over the past several years. The issue for policymakers has less to do with overall effects than with who in those societies gets squeezed. As long as the power blocks are taken care of, ‘f**k the population’ continues to be the modus operandi–unless and until people are organized enough to resist. There are some signs of that, but far too sporadic and small scale to matter much. And now with the downing of the flight and the ensuing anti-Russian/Putin propaganda, emotions are running high to punish Russia, even if it hurts the EU. I live in the Netherlands, so my perspective may be somewhat warped in this respect, but from friends living in other EU countries, public sentiment seems similar.

    1. EoinW

      If I had to place a bet, I’d put my money on your conclusion. It is intriguing to speculate if European leaders are free players or quisling puppets of the Amerikaner Reich. Considering the German non-reaction to not getting its gold back, I have to think Merkel and company were bought long ago. Really Germany is the only EU player that matters in all this. Also considering how politicians live and die on PR, allowing all the anti-Putin bashing is surely a clear indication which side they are on.

      I think the time has come to stop the speculating and admit the West’s 1% are all exactly the same, regardless of their different nationalities. I would have liked to see Putin’s moderation rewarded, however it seems clear Paul Craig Roberts reading of the situation is more correct. Pray for an economic collapse in the West before our leaders start WW3. Perhaps an Argentine default? Or maybe the Chinese and Russians will take the gloves off and dump the US dollar instantly.

    2. steviefinn

      It’s tragic that the propaganda works so well. if this was a murder case in a court of law, I think the evidence would be basically circumstantial & motive would surely point to Kiev. Having spoken to a couple of people who would spit on Putin’s name, I think for many people having a bad guy makes it all very simple. It’s better than all the cognitive dissonance that would occur if they were to consider the horror that their government doesn’t give a shit about them, tells big lies & that they are mostly a bunch of self serving careerists.

      The stuff that seeps out from government every 50 yrs in the UK should give pause for thought, but of course that was then, now is different.

  12. Carolinian

    Meanwhile there’s the Yukos award.

    More byzantine details here.

    A lot of interesting media hypocrisy surrounding the treatment of the Russian oligarchs. When their assets are seized it is played as terrible Putin corruption whereas the source of those assets–privatization under Yeltsin–is never talked about or considered somehow virtuous. One half suspects that a lot of the Putin hate in the West has to do with his pulling away the plunder punch bowl that was benefiting some very powerful players who have allies in the Western media.

  13. lakewoebegoner

    Unlike the West, Russia is not made of up minions of profit-maximizing automatons (excluding certain oligarchs). For most Russians, the situation in Ukraine is an existential crisis and a matter of national sovereignty and pride. The inconvenience of tier XXX sanctions means nothing to a country that went through 1941 to 1945 (as the Russians reminded themselves every May).

    What would the USA have done if it was discovered that the old Soviet Union channeled millions of dollars to an opposition party in Mexico or Canada? The US had (still has) the Monroe Doctrine—-welll Ukraine is Russia’s equivalent.

    And as Yves mentioned in a prior post about the Western elites going nuts and seemingly purposely engaging in self-destructive behavior—-what does the US/West want Ukraine so badly? (I’m guessing just as a neo-con prize so that someone can smugly say the US foreign policy can get something right to counteract the failures in Afghanistan, Iraq, Libya, Gaza, etc).

    Ukraine is an economic wreck—-if Poland is Germany’s Mexico, Ukraine is Poland’s Mexico. The EU (especially the UK) is going nuts about unfettered Eastern European immigration and wasted EU development aid—well adding another 40 million broke Ukrainians isn’t going to go over well in the UK tabloids.

    I’m not pro-Russian, not pro-Kiev, got no dog in the fight—-just trying to walk a mile in someone else’s shoes and but just plain ol’ befuddled as why so many Western leaders are willing to escalate issues over a country that is way outside the traditional Western sphere of influence.

    1. madisolation

      The U.S. wants NATO forces next door to Russia. I’d say it’s a mad dash to conquer Russia (and then China) before the USD collapses on its own, or before the BRICS nations feel U.S. and western aggression has gotten out of hand, and they must bite the bullet and dump the USD, even if it’s premature to do so. Then again, I may view events too negatively, and I’m more than likely too simplistic about the fall of the dollar.

      1. Gaianne

        Yes, those are the underlying issues.

        And as corruption continues to hollow the US out, the ability to project full-spectrum-dominance wanes. The US has very little time left. Imperial expansion must happen now before the ability to carry it out disappears altogether.

        On the surface, we see incoherence. The US no longer knows how to work toward its goals: No tactic promises success. So one crazy thing is tried after another in an atmosphere of panic. A seamless propaganda machine smoothes over the inconsistencies for the American public, but not for the rest of the world, and reality on the ground simply goes its own way.

        The US has no intention of correcting its behavior, ever. This is the key problem.


      2. cwaltz

        I think you pretty much nailed it. This is about being a “superpower” and about continuing to be able to bend other nations to our will. Quite frankly, they can’t create a basket of money fast enough for me. I’ll be happy when this country can no longer usurp democracies that they don’t approve of because they don’t pay enough deference to our 1% fast enough.

        Then again, I keep hoping the whole entire lot of spoiled greedy oligarchs take their ball and head off like they’ve been threatening for the past decade or two. Maybe then the middle class might get a chance to enact policies that benefit the majority instead of a select few rich folk.

    2. susan the other

      We might get up the courage to ask someday, Please sir can you tell me why oil is so expensive?

      1. cwaltz

        It’s a limited resource. I think the better question to ask is who benefits/ has benefitted by allowing it to dominate and not applying equal support to energy alternatives way before now?

    3. NotTimothyGeithner

      There are different elements at play.

      -the neoconservatives
      -run of the mill thugs such as Cameron
      -the war presidents; for Obama giving orders to the military is easier than convincing his voters social security cuts are good; Obama has become a thug, but I think it’s largely a result of his pursuit of his myriad of domestic failures. At this point, killing Bin Laden ready for his library. The courts just revealed Team Blue never read ACA.
      – the people eyeing the Ukraine for resource extraction
      -war profiteers; US arms have soared under Obama, and is t he lone bright spot of the U.S. economy. Between domestic opposition and market saturation, the U.S. has no where to go but down which means they need a new market or move into replacements.

    4. John Yard

      The EU is interested so strongly in a failed Ukraine, because expansion to the east validates an EU that is clearly failing. Austria-Hungary sought influence in the Balkans for the same reason : the state needed to paper over internal problems with a success.

  14. Jackrabbit

    “. . . befuddled as why so many Western leaders are willing to escalate issues over a country that is way outside the traditional Western sphere of influence.”

    – very cheap pool of labor

    – arable lands (increasingly important due to global warming)

    – deny Russia a key ally, and create a constant irritant instead

    – NATO expansion and arms sales

    – block any potential EU-Russia rapprochement

    – potential to use Ukraine for further destabilizing ops (Belarus, Caucasus)

    – another strongly pro-US country as part of EU governance

    – Kolomoisky (an important and powerful jewish Ukrainian Oligarch) has talked of Ukraine could be a second jewish homeland. This may not be as far-fetched as it sounds and a tight Israel-Ukraine alliance has many benefits for Israel.

    Given all of these potential ‘benefits’ and the fact that Russia is a key member of Russia-China-Iran Axis and BRICs alternative financial system, it is difficult to see the US backing away from it support for Ukraine until failure is so obvious and complete that it has no choice. At the same time, countering an anti-Russian regime in Ukraine is so crucial to Russia that they will do everything to prevent a US “win”. We in the West will all pay, in one way or another, for this adventure.

    H O P

    1. susan the other

      Ukraine as the second Jewish homeland makes lots of sense. I think the day will soon come when Israel is no longer defensible and the Jews/Israelis will have to be evacuated – per the post here yesterday. Ukraine seems a most logical choice even tho’ the Jews have long since departed that region for their zionist dreams. Trotsky came from Ukraine. Now there is a figure everyone can gather around. Except Stalin.

      1. Mark P.

        ‘Ukraine as the second Jewish homeland makes lots of sense.’

        Only if you’re somebody who is both entirely ignorant of history and has never actually been to the Ukraine.

        If you have ever been to Odessa, say, you would have seen that big park in the city center. Right there in that central park is where in 1941 the Nazis and the Romanians massacred literally close to a one-hundred-thousand Jews in the full sight of and with the enthusiastic support of the local population. They didn’t hide that stuff away in concentration camps in the Ukraine.

        It was and remains the most anti-Semitic place on Earth. Short of complete genocide of the currently existing Ukrainian population — please, of course, feel free to tell us all about your hilarious tinfoil hat theories on that score — it is not likely to be the site of a “second Jewish homeland.”

        1. Jackrabbit

          Beware the Cameleon

          Kolomoisky has a powerful «insurance policy» against any legal recriminations. He counts on the powerful Israel Lobby in the United States to support his cause. Kolomoisky has publicly spoken of Ukraine as the «second homeland» of the Jewish people. And with «The Lobby» in his corner, Kolomoisky has indirect access to the highest levels of power within the Department of Defense, NATO, and the U.S. Intelligence Community.

  15. steviefinn

    Robert Kagan in 2008 in an article where he was trying to blame everybody else for the Iraq debacle :

    “The two rising powers, China and Russia, are autocracies. They are undoubtedly becoming more aggressive and nationalistic. They will shape the entire international system to suit their purposes, unless democratically minded nations join forces and demonstrate their own collective will to shape the world order”.

    Fantasy : A charge of the mechanised armchair warrior brigade.

    1. Banger

      The interesting thing about Kagan and his clique is that exactly the opposite seems to be always true. They take it as a given that “democracy” is the singular goal of U.S. Foreign policy whereas if you simply look at the facts you see that this cannot be true. The U.S. only support democracies if they recognize the USA as their feudal sovereign. Otherwise it makes no difference whether you are The UK or Saudi Arabia.

      1. cwaltz

        I always laugh at the ridiculousness that the US is some champion of democracy. We sure had no problem fixing things in Iran to install our leader of choice and I’m pretty sure we’re still spending money trying to depose the leadership in Venezuala despite the fact that it was popularly elected.

  16. The Dork of Cork

    Given the structure of the present irish economy (absurdly open to capital / labour inflows and outflows) any turmoil east of the Rhine will greatly benefit any pointless capitalist enterprises on this island as so much energy is lost via the mechanism of long distance trade caused by a chronic local money shortage.

    We are simply witnessing a giant bank known as the global economy find mechanisms to adjust its tempo of operations while maintaining its vice like grip on power.

  17. steviefinn

    Chanced on this site today which gives daily updates from the civil war’s front lines. It is obviously written from the POV of the rebels & should of course be viewed as possible propaganda, but to me it is the included minor detail such as the mention of the corruption among troops from both sides that gives it a feeling of being very real & very raw.

  18. peteybee

    For now, lets also set aside moral questions about whether or not violent regime change in the Ukraine was more or less aggressive than independence-referendum votes held by Ukranian-Russians.

    Instead lets look at some side effects.
    #1. China. Huge win for China, as they can now get all the commerce and natural resources that Russia now trades with Europe.
    #2. China. Now they have a way to get rid of their extra dollars and euros, if they need to. (trade them to Russia!)
    #3. China, India, South America, Southeast Asia, etc. Perhaps they will look at the US’s weaponization of the financial system and accelerate measures to diversify and protect themselves, building alternative international institutions. Presumably anchored by the strong point in Shanghai – Hong Kong. This would actually be a benefit for the world, but a slight loss for US-EU financial centers.
    #4. Middle East. With a full-spectrum disaster for US middle east policy still going on, it is possible that Russia withdrawing cooperation may make things harder on this front? As the US’s resources are occupied with Russia, wouldn’t the Islamic extremists take the opportunity to make a move, for example in Afghanistan?
    #5. US strategic interests / Planet Earth. In the unlikely event that the US is actually successful with a regime change in Russia, then what happens? What is the track record for stability, in the immediate aftermath of US-engineered regime changes? Who exactly would take over the Russian government? What’s the game plan there? This wouldn’t happen to be another NeoConservative fantasy, promising a cakewalk, and sunshine and lollipops all around, would it? And anyhow, how would it all benefit the US? Would Russia magically turn into a US ally against China, or would it become a devastated mess, with nuclear weapons in the hands of the various oligarchs who would be the ones to pick up the pieces?

    (shameless plug: my blog)

  19. Paul Samuel

    It’s hard to imagine that Russia will go quietly from the ranks of “Great Powers.” Ukraine is to Russia as the Midwest is to the Northeast, more or less. Outsiders are not going to have an easy time dictating relations between Ukraine and Russia. What would the US do if any European or Asian “power” tried to separate Ohio (and the old Western Reserve of Connecticut) from the mid-Atlantic and New England states? Joke as much as you like about Ohio, but if a Brazilian, French, Indian, Chinese or Japanese “power” tried to pull a fast one in Cleveland, to install a “free State of Ohio,” does anyone think Washington would waste a moment going ballistic, literally? Russia may be down, but it is far from out. At the level of existential conflict among “Great Powers,” economics plays a minor role. We’ve been destroying our own economy for a couple of generations to keep our Great Power status where it is. Russia will do the same if it must. If you think getting out of Iraq is proving hard to do, try getting out of Russia when the fighting really gets going. Hasn’t that been tried a couple of times before? Count me and my friends out of that one!

  20. Dennis Redmond

    Yves, the Left SHOULD be siding with Ukraine. Russian terrorists just shot down a plane with 298 innocent civilians, using an SA-11 missile system which came from the Russian army. There is no serious separatist movement in eastern Ukraine, because the provinces of Donetsk and Lugansk are 70% ethnic Ukrainian, and the vast majority of the ethnic Russians who live there detest Putin’s Russia (many have joined national guard units to defend their homeland). The problem is that thousands of Russian mercenaries with Russian passports, armed with Russian T-64s, Russian APCs, Russian Grad missiles, Russian ground-to-air missiles, and Russian SA-11s (one of which shot down Malaysia’s MH-17, murdering 298 innocent civilians), are occupying Ukrainian territory. Putin has been fomenting a horrible, evil war of imperial-colonial aggression on a fellow Slavic nation. So, yes, Russia deserves sanctions.

    If readers need additional background on the conflict, check out Timothy Snyder’s essay on Maidan (, read the Kiev Post ( for good critical coverage of the conflict, read the Kharkov Human Rights Group on Russia’s state-media information war against Ukraine (, and follow English-speaking Ukrainian journalists such as Myroslava Petsa ( and Olga Tokariuk (

    As for the rest of the comments: Putin’s regime is no counterweight to US power, it is just another low-rent neoliberal empire, a vicious petro-plutocracy whose sole purpose is to enrich Russia’s 0.1% at the expense of Russia’s 99%. We ordinary Americans, the people of Russia, and the people of Ukraine all need to unite and fight our respective plutocrats and thuggish elites. The first step is ending the neocolonial wars waged by those elites to justify their looting and stealing. That means resisting the godawful, evil US Terror War on the planet, while also resisting Putin’s equally godawful, evil Russo-imperial war on Ukraine.

    1. hunkerdown

      That’s a very hard sales pitch you’re driving there, pardner. The simple application of “Cui bono?” pretty much demolishes everything you’ve said.

    2. Goat_farmers_of_the_CIA

      From May 29’s Links (
      “Ukraine: The Antidote to Europe’s Fascists? Timothy Snyder, New York Review of Books. Snyder has now crossed the line from being a propagandist to being certifiable. ”
      Dennis, you would do well to sticking to your “research” on “videogame culture and transnational media”. Obviously, judging from your naiveté, you are too much into the former and not going deep enough into the nature of the latter. From your own post:

      “That means resisting the godawful, evil US Terror War on the planet, while also resisting Putin’s equally godawful, evil Russo-imperial war on Ukraine.”

      Indeed, it seems you are probably spending too much time online trying to wipe out Putin’s invisible army…

    3. Jackrabbit

      “Russian terrorists just shot down a plane with 298 innocent civilians . . .”
      You view is yet unsubstantiated. In fact, circumstantial evidence is pointing to a different conclusion. See: MH17 Verdict: Real Evidence Points to US-Kiev Cover-up of Failed “False Flag”.

      The rest of what you write is equally misleading, misguided, and generally shows that you have drunk the koolaid. The left should be on the side of peace, not shoot-from -the-hip warmongers. Your links are all one-sided. Readers should carefully read and consider opinions from BOTH sides of this propaganda war before making up their mind. It also helps to be mindful of the mendacious ways of the Obama Administration – especially their attempt to wrongfully bomb Syria – as well as how the US lied to the world before attacking Iraq – because the necons that got us into the Iraq War are still active today.

      If -YOU- want to go fight for Ukraine, go right ahead.

      H O P

    4. Abe, NYC

      I still cannot believe the scale of support that Putin has generated among the left. I suppose many people are so disillusioned with the US that they will support anyone that opposes it, even if in this case this is a ruthless, corrupt, oligarchic leader with imperial ambitions.

      Unfortunately, it is extremely difficult to obtain reliable information on this conflict because the US and Russia are locked in a propaganda war. Many of your statements are true but many are difficult to verify. On MH17, we still don’t know who shot the missile. Although it appears it was most likely the insurgents, the US has refused to release any data which it says proves the missile was launched from the insurgents’ territory.

      Several relatively reliable reports say that the insurgents are mostly local, although the exact share of Russian citizens is uncertain. Chechens alone probably number in the hundreds. The military and political leadership of the insurgents are mostly Russian citizens, some with murky backgrounds in Transnistria and other fun places.

      Support for Putin among Ukraine’s Russians outside Donetsk and Lugansk is actually a very interesting question. I’ll see if I can find some reliable information on that.

      1. Jackrabbit

        You lose your credibility in the very first sentence.

        Most here and elsewhere who don’t support US necons/neolibcons or their Ukrainian patsies are not pro-Putin. They are anti-fearmonger/warmonger.

        They are anti-war because they understand that war only benefits oligarchs and ideologues. They are skeptical because they have taken note of the lies and abuse of TPTB. And in this particular conflict, they don’t see any strategic interest that would require that the West risk war with Russia. And that seems where we are headed if US/Ukraine insists on attempting to eliminate the Separatists.

        There is a contingent of web bloggers, that are now pushing HARD on key propaganda points like depicting critics of US/Ukraine as ‘pro-Putin’. This is a McCarthyesque device to shut down debate. Its very disappoint that it appears here at NC.

        1. Abe, NYC

          I cannot see how one can be anti-fearmonger and warmonger and support a brutal armed insurgency at the same time. What I can see, to repeat myself, is that Putin has generated a very large support on the left – even before the conflict but even more so after the conflict. I can also see that Putin is forgiven all of the same sins that Obama is justly vilified for including military interventions, neo-liberal policies, disrespect for human rights, etc etc.

          1. OIFVet

            Very simple: 1) our a$$holes are more immediate threat to our well-being than Putin, and 2) most Americans are not former Soviet subjects and do not give a crap about former Soviet subjects trying to drag them into a conflict that has nothing to do with them. Wanna get a revenge on them evil Russkies and Vlad the Impaler? Get and pay for your own damned army and try. Hint: rub some lard onto your collective buttocks first, that way the resulting a$$-kicking will hurt a bit less.

  21. Abe, NYC

    There have been several important developments since the sanctions started.

    First, either the sanctions or other threats have apparently resulted in a stunning early success: reversal of plans to invade Eastern Ukraine and subsequent revocation of Duma’s authorization of the invasion. Some analysts believe a meeting between Putin and OSCE Chairman/Swiss President on April 23rd was decisive, after which the preparations for an invasion around April 25th were ratcheted down. Some believe a threat was made to freeze Putin’s personal assets.

    Second, by now hardly anyone in Russia mocks the sanctions like they did in April or May. It’s more or less obvious that the sanctions are going to bite hard, and not just the elites who own real estate in Belgravia.

    While Russians are now united behind Putin, there are two important threats to this unity:

    1. If Putin tries to normalize the situation and cuts support to the insurgents, that can easily become a PR disaster which will not only remove a large part of Putin’s support but also destroy the consensus on Ukraine; Nikolai Svanidze believes it would spell Putin’s political death.

    2. If the situation in Ukraine does somehow get normalized to satisfaction of the Russian public and the dust settles, it will be difficult to maintain the hysteria that keeps Russians united and on edge. A year or two from now, when Russians wake up and notice that although they got Crimea, the economy is in the doldrums, unemployment is high, many goods have become unavailable or unaffordable, they may start to lose confidence in the leadership. An obvious solution to this is yet more crises but they may have diminishing returns in terms of keeping the public loyal.

  22. Jackrabbit

    To you, its all about Putin. What comes after Putin? What makes you think that he or she would be any better?

    My God! no one really complained about Putin as short as 6 months ago, now he is “Hitler” and the devil incarnate for reacting (to whatever extent that he is) to neocon meddling in his backyard.

    1. Abe, NYC

      6 months ago Putin had not yet thrown the rulebook of European security out the window. But even then I had no illusions about Putin and commented on this occasionally.

      As for who comes after Putin, that’s an interesting question. The popular leader of the opposition, Aleksei Navalny, made a name for himself as a fearless corruption fighter – indeed, no-one has done more than him to expose the rot at the top. But he also even more nationalist than Putin. Not only has he associated with nationalist parties and called for tightening visa regime and restrictions on immigration, but he also commented how difficult it was to prevent people from Caucasus move to Moscow and other cities in European part of Russia, since they are Russian citizens. In the unlikely event that Navalny does come to power, that doesn’t bode well for Russia.

  23. Maju

    For the European Union, USA, China and Russia are nearly tied as foreign economic partners (14%, 13% and 10% respectively of global EU’s trade, compare with a mere 2% of India or Brazil). However the USA is a neat importer while Russia and China are neat exporters instead. Honestly, I do not know what is more important, particularly in the case of Russia which exports mostly essentials (gas, oil) to EU, essentials without which the European economy would have to radically switch to renewables, something that is not really feasible in the short term.

    The USA has tried to patch that dependency offering transatlantic shale gas but this looks far from being (1) a feasible option and (2) an option that regional powers like Germany would be happy with. That is because Russia acts as imperfect counter-balance of US hegemony in Europe and poses absolutely no short-term threat as replacement of that transatlantic hegemony. Clearly states like Germany, strongly dependent on Russian gas and willingly so, are looking more and more to this Ukrainian mess induced by Washington as a most undesirable risk and will actively boycott any meaningful sanctions against Russia while sliding more and more towards Moscow.

    Germany in particular is less and less comfortable with the NATO Imperial status quo. We could see it declining to act in Libya and Syria and now writhing in the NATO/EU web, which it can’t disentangle so easily, in the Ukrainian conflict, that particularly attacks its own interests of unequal partnership with Eastern Europe and very especially with Russia. The fact that the NSA scandal has become much more relevant in Berlin than in any other European capital underlines the growing Berlin-Washington tensions, whose respective interests are clearly less and less common.

    I’m unsure about the French position (sends ship to patrol the Black Sea but also sells warships to Russia) but otherwise it seems that Washington’s position is only supported by London and Warsaw, as well as a small array of Baltic states (Sweden, Latvia). Most other states are uninterested, fearful or even hostile to Washington’s plans (Germany particularly). I don’t think they have any interest in confronting Russia at all on what is deemed as an issue within the Russian influence area, much less in going to war with Russia, a war which would no doubt destroy Europe altogether (maybe the “star wars” system can defend the USA, I can’t say, but certainly not Europe).

    US imperial hegemony is right now sowing very dangerous winds in and around Europe (Islamic State, Zionist gratuitous violence, Ukrainian Fascism). All this coupled with the already growing internal instability of the EU (including the menacing raise of fascism in many places) can end extremely badly for Europe. I personally fear the worst.

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