Just a month ago, Putin had one of his pet oligarchs, the firmly pro-Russian multi-billionaire Yanukovich, in power in Ukraine. Putin had been to an awful lot of trouble to ensure that Yanukovich got elected. It is undoubtedly true that the United States and its allies funded various pro-western groups in the Ukraine – my friend Ray McGovern, former senior CIA, put a figure of US$100 million on it, and he should know. The resources Putin poured in to ensure Yanukovich’s election were more in kind than financial, but were not on too different a scale.
In earlier attempts to put Yanukovich in power, Putin had in 2004 helped organise massive electoral fraud, and Putin’s secret service had attempted to assassinate Victor Yushchenko. The 2010 election of Yanukovich also involved a great deal of fraud. Russia is an influential member of the OSCE, Ukraine is also a member and that organization is notably mealy-mouthed in pointing out the derelictions of its own members. Nonetheless its observation mission of the 2010 Presidential elections stated:
“The presidential election met most OSCE commitments and other international standards for democratic elections and consolidated progress achieved since 2004. The process was transparent and offered voters a genuine choice between candidates representing diverse political views. However, unsubstantiated allegations of large-scale electoral fraud negatively affected the election atmosphere and voter confidence in the process.”
That is about as close as the OSCE has ever come to accusing one of its own members of fraud. International organisations have their obvious limitations.
Putin had put years of effort into getting the President of Ukraine which he wanted, and he had him. Yanukovich attempted to steer an even-handed path between Russia and the West, while putting his main effort into acquiring an astonishing personal fortune. Putin lost patience when Yanukovich appeared ready to sign an EU association agreement, and put extremely heavy pressure on Yanukovich over debt, energy supplies, and doubtless some deeply personal pressures too. Yanukovich backed down from the EU Association agreement and signed a new trade deal with Russia, appearing on the path to Putin’s cherished new Eurasian customs union.
The west – and not only the west – of Ukraine erupted into popular protest. The reason for this is perfectly simple. Income, lifestyle, education, health and social security for ordinary people are far better in western and central Europe than they are in Russia. The standard of living for ordinary Polish people in Poland has caught up at a tremendous rate towards the rest of the EU. I am not depending on statistics here – I have lived in Poland, travelled widely in Poland and speak Polish. I was professionally involved in the process of Polish economic transformation. There have been a large number of commenters on this blog this last few days who deny that the standard of living for ordinary people in Poland is better as a result of EU membership, and believe life for ordinary people is better in Russia than in the west. I also of course speak Russian and have travelled widely in Russia. Frankly, you have to be so ideologically blinkered to believe that, I have no concerns if such people leave this blog and never come back; they are incapable of independent thought anyway.
Undoubtedly pro-western groups financed by the US and others played a part in the anti-Yanukovich movement. They may have had a catalytic role, but that cannot detract from the upswell of hundreds of thousands of Ukrainians who were not paid by the West, and drove Yanukovich from power. It is true that, when the situation became violent some very unpleasant nationalist, even fascist, groups came to the fore. There is a great deal of extreme right wing thuggery in all the former Soviet Union – ask Uzbeks who live in Russia. The current government in power in Kiev seem a diverse bunch, and seem to include some pleasant people and some very unpleasant people. Elections this year will make things clearer. It is also true that corruption is the norm among the Ukrainian political elite, across any nationalist or ideological divides.
In a very short space of time, Putin went from the triumph of killing off the EU Association agreement to the disaster of completely losing control of Kiev. But for reasons including trade, infrastructure and debt, the new government was bound to come back to some relationship and accommodation with Putin eventually. It just needed patience.
Instead of which, Putin decided to go for a macho seizure of the Crimea. There is no doubt that the actions of surrounding military bases and government buildings by Russian forces, and controlling roads and borders, are illegal under international law. There also appears little doubt that a large proportion of Crimea’s population would like union with Russia, though whether a genuine majority I am not sure. I am sure under these circumstances of intimidation and military occupation, the referendum will show a massive majority. Hitler pulled the same trick.
So now Putin can stride the stage as the macho guy who outfoxed the west and used his military to win Crimea for Mother Russia. But it is an extremely hollow victory. He has gained Crimea, but lost the other 95% of the Ukraine, over which one month ago he exercised a massive political influence.
The western powers will not bring any really effective sanctions that would harm the financial interests of the interconnected super-rich, be they Russian oligarchs or City bankers. But they will now do what they were not prepared to do before, provide enough resources to make Ukraine politically free of Russia. The EU has already agreed to match the US$19 billion in guarantees Putin had promised to Yanukovich. Before the annexation of Crimea the EU was not prepared to do that.
The Crimea was the only ethnic Russian majority province in Ukraine. Donetsk does not have an ethnic Russian majority, only a Russian speaking majority – just like Cardiff has an English speaking majority. The difference is key to understand the situation, and largely ignored by the mainstream media. Without Crimea, the chances of the pro-Putin forces in the rest of Ukraine ever mustering an electoral majority are extremely slim. Putin has gained Crimea and lost Ukraine – has he really won?
The real tragedy, of course, is that Ukraine’s relationships are viewed as a zero-sum game. Russia has huge interests in common with Europe. I hope to see Ukraine a member of the EU in the next decade, and Putin has made that vastly more likely than it was a month ago. But why does that have to preclude a close economic relationship with Russia? The EU should not operate as a barrier against the rest of the world, but as a zone of complete freedom within and ever-expanding freedom to and from without. And European Union will never be complete until Russia, one of the greatest of European cultures, is a member.
Ukrainians are basically Slavic people inhabiting a land that has not been independent since the Iron Age. Whether they’ll be at home in the EU remains to be seen.
Putin’s having gained Crimea and lost Ukraine – if that is, indeed, going to be the case – may not be such a bad deal for Russia after all. One wonders who will pay Ukraine’s debts. One way or the other, Ukraine will get on with Russia as they have to.
As for Russia becoming a member of the EU – I don’t really see them deferring to Brussels – “a zone of complete freedom within and ever-expanding freedom to and from without”
” One wonders who will pay Ukraine’s debts.”
Ukrainians…..
http://www.businessweek.com/ap/2014-03-05/top-official-says-eu-to-provide-ukraine-15-billion-aid-package-in-loans-and-grants
“Most disbursements will likely hinge on the formation of a new Ukrainian government after elections in May and an agreement on wide-ranging reforms with the IMF. The fund will likely insist, among other things, on a currency devaluation and a sharp hike to natural gas prices, which Ukraine subsidizes heavily.”
I think the ‘iceberg effect’ in in play with austerity for the $15 billion in IMF aid. They need $35 billion over the next two years, and the erosion of the economy will proceed as Japan’s.
I see where you’re coming from Craig, but do not agree with you.
I suppose the West got what they manufactured.Putin has just reacted. Surrounding Ukrainian bases on the Crimea makes total sense.He would look extremely silly having his Black Sea fleet surrounded instead. And then who knows what this idiot in charge could’ve ordered as he is now in control I suppose of Ukrainian armed forces.He has already told media in a speech that Russian tanks were rolling into Crimea.Interestingly enough, he also brought up Iranian nukes.He is Jewish after all and has dual citizenship, but maybe that’s just another coincidence.
It’s pretty sad when you believe other leaders more than your own.We don’t have a Lavrov or a Putin. Just a bunch of silly school boys playing at politicians.They get their script from the FO or the City.
We have a lot of Ukrainians and Russians in Vienna. They mix totally. You can meet them all ,including very attractive ladies at the Russian Trade mission here. I haven’t been there since the troubles began,but have a hard time believing that there’s bad feeling.Too much vodka under the bridge.They always argue politics,but that seems to be like entertainment for them.The barman is from Turkmenistan and his wife from Azerbadjan.
Feryudin always calls himself Russian.
Macky, Mary was posting after that comment on the next thread as well. If offended it was most likely this comment.
http://www.craigmurray.org.uk/archives/2014/03/putin-and-international-law/comment-page-2/#comment-443888
“So we all are driving Russian cars then, in the UK? Flying on Russian planes?”
We could well be soon, I think it’s three American car manufacturers have factories in Russia now. The days of the Lada are over
Gaston: There’s many stories of where the Ukrainians came from.
The Swedish Vikings invaded that region. The Ukrainian flag has exactly the same colours as the Swedish flag. The women are very blond and Scandinavian looking.The language is Slavic, but there’s a good mix there.As I found out when they held the Euro Song contest, many customs are similar or the same to those of Sweden.
As for the EU. Neighbouring countries have always traded with each other.Scotlands biggest trading partner way back in the 1200’s was Belgium or Flanders as it was.The Hanseatic League was huge in its time.It did not hinder you from trading with anybody else, it just made it easier.That’s all our Union was sold to us as.I don’t want it to become a US of E.
(OT) I loved my Lada.
Most teens want full independence, but teens are caught by the reality of economic dependence. The Ukraine may want to shake off its dependence from Russia, but Yanukovich was right when he said that he had to be realistic. Here is the reality that the Ukraine must deal with: 70% of its economy is trade with Russia. That might change in the future, but right now, its trade is dependent on Russia. The Ukraine gets and is unable to pay for its use of gas, which was over $400 million in February and did not pay. The debt to Russia approaching $2 billion, and who knows how much to other debtors. I don’t question that corruption by politicians is a huge problem, but I doubt that it is the reason for all the debt that the Ukraine owes. The current government doesn’t have the support of majority of the Ukraine people. Why do I say this? Because other cities did not follow Kiev. In other countries, we saw demonstrations all over, e.g. Egypt, Tunisia, etc. Being in debt to the Russians or to the IMF, like the Greeks, makes no difference. I doubt that Russia will give its gas to the Ukraine at half price if it decides to go with the EU.
Thank you, Craig, and congratulations on a masterful piece which summarizes the build-up to where we are now and likely short-term consequences; I agree with 95% of what you wrote.
Also thanks to Uzbek in the UK for so ably and energetically rebutting many of the ensuing posts from the usual suspects.
~~~~~~~~~~~~~~~~
I’m sure you’ll forgive me this little observation: perhaps you’ll understand from the reactions which this and your couple of previous themes have provoked why I’ve intervening quite so frequently on your blog over the past year or so. The themes have been multiple, but the approach of – I’m sorry to say of the majority of – your regulars is always the same. QED.
To add to my recent post, you may use Google translate for this article from El Pais, Spain.
La economía ucrania habla ruso
http://internacional.elpais.com/internacional/2014/03/04/actualidad/1393961386_739757.html
One realises the approach or path is the same having gone through the same gate. That is harmony, singularity, of oneness, of connection, of non-duality. That is the proof. QED
Mobile phone age,reports of troop movements,no restrictions on movement, just approaching bases.
If there were large troop movments someone would have recorded them.
They haven’t happened.
“Dr Paul Craig Roberts is an economist and was Assistant Secretary of the US Treasury for Economic Policy under Reagan and associate editor of the Wall Street Journal.”
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Herbie, beware of false Gods – and of excessive hero worship.
Yes, Roberts is an economist by training – as were Milton Friedman, Patrick Minford, Joseph Schumpeter, Margaret Thatcher’s favorite guru Alan Walters and many others to whom you would probably not link in quite the same fawning manner.
He was indeed an Assistant Secretary at the Treasury – for all of 11 months more than 30 years ago. At present, there are around 11 Assistant Secretaries in the Treasury Dept.
And he is no longer an Associate Editor at the Wall Street Journal and hasn’t written for it for a long time.
I advise anyone who wants to savour Dr Roberts’ all-encompassing wisdom, dispassionate and even-handed analytical capacity, prophetic track record and multi-track mind to either read Counterpunch regularly or to go onto the man’s own website. The man is a David Ike with degrees in economics.Enjoy while you can (for, according to the good Doctor, the end of the world is nigh)!
“One realises the approach or path is the same having gone through the same gate”
Indeed, Mark. Who was it said the definition of insanity is doing the same activity to perpetuity, expecting different results?
Habby
Feel free to rebut Dr Robert’s arguments, rather than your usual cheap jibes.
Or not.
He’s had quite an accomplished and full career on the economic frontline, which you can read all about here:
https://en.wikipedia.org/wiki/Paul_Craig_Roberts
“Roberts is a graduate of the Georgia Institute of Technology and holds a Ph.D. from the University of Virginia. He was a post-graduate at the University of California, Berkeley and at Merton College, Oxford University.[5] His first scholarly article (Classica et Mediaevalia) was a reformulation of “The Pirenne Thesis.”
In Alienation and the Soviet Economy (1971), Roberts explained the Soviet economy as the outcome of a struggle between inordinate aspirations and a refractory reality. He argued that the Soviet economy was not centrally planned, but that its institutions, such as material supply, reflected the original Marxist aspirations to establish a non-market mode of production. In Marx’s Theory of Exchange (1973), Roberts argued that Marx was an organizational theorist whose materialist conception of history ruled out good will as an effective force for change.
From 1975 to 1978, Roberts served on the congressional staff. As economic counsel to Congressman Jack Kemp,[6] he drafted the Kemp-Roth bill (which became the Economic Recovery Tax Act of 1981). He played a leading role in developing bipartisan support for a supply-side economic policy.[5] Due to his influential 1978 article on tax burden for Harper’s,[7] while economic counsel to Senator Orrin Hatch,[8] the Wall Street Journal editor Robert L. Bartley offered him an editorial slot. He wrote for the WSJ until 1980.[9] He was a senior fellow in political economy at the Center for Strategic and International Studies, then part of Georgetown University.[6]
From early 1981 to January 1982, Roberts served as Assistant Secretary of the Treasury for Economic Policy. President Ronald Reagan and Treasury Secretary Donald Regan credited him with a major role in the Economic Recovery Tax Act of 1981, and he was awarded the Treasury Department’s Meritorious Service Award for “outstanding contributions to the formulation of United States economic policy.”[5]
Roberts resigned in January 1982 to become the first occupant of the William E. Simon Chair for Economic Policy at the Center for Strategic and International Studies, then part of Georgetown University.[10] He held this position until 1993. He went on to write The Supply-Side Revolution (1984), in which he explained the reformulation of macroeconomic theory and policy which he had helped to develop.
From 1993 to 1996, he was a Distinguished Fellow at the Cato Institute. He also was a Senior Research Fellow at the Hoover Institution.[5]
In The New Color Line (1995), Roberts argued that the Civil Rights Act was subverted by the bureaucrats who applied it. He thought it was being used to create status-based privileges and threatened the equality of the Fourteenth Amendment in whose name it was passed. In The Tyranny of Good Intentions (2000), Roberts documented what he saw as the erosion of the Blackstonian legal principles that ensure that law is a shield of the innocent and not a weapon in the hands of government.
Honors and recognition
In 1987 the French government recognized him as “the artisan of a renewal in economic science and policy after half a century of state interventionism”; it inducted him into the Legion of Honor on March 20, 1987. The French Minister of Economics and Finance, Edouard Balladur, came to the US from France to present the medal to Roberts. President Reagan sent OMB Director Jim Miller to the ceremony with a letter of congratulation.[5]
In 1992 Roberts received the Warren Brookes Award for Excellence in Journalism from the free-market American Legislative Exchange Council. In 1993 the Forbes Media Guide ranked him as one of the top seven journalists in the United States.[5]”
Anyway, Corbie and Ryan Dawson take a look at Ukraine and other issues:
http://www.corbettreport.com/interview-836-ryan-dawson-looks-for-a-third-way-in-the-ukraine-crisis/
Well, can’t Mary take a few days off to enjoy the warm March weather without causing concern? We haven’t seen it for 5 years.
Due diligence on the topic of Ukraine before commenting might be another reason for her absence.
After all Craig lost his job because of frustration with the reckless policy of UK and US torture in the War on Terror. The reckless policies of Putin seems to me to be a bit of a smoke-screen at this moment of time for the reckless policies of the West in using Al Qaida in Syria.
I come to the conclusion that we are being deliberately protected by our leaders, their cotton=wool media and their former diplomats and generals, from engaging with the main issue of the day, how to strangle the last of the Middle-Eastern dictators, the leaders of Jordan, Syria and Saudi Arabia so that a new, Westernised deal can be constructed with Islam.
Look look an invasion in Ukraine.
But I would think that wouldn’t I? Craig is currently deleting comments pointing the wrong way and raising storms in tea-cups about irrelevancies in Ukraine.
“The EU has already agreed to match the US$19 billion in guarantees Putin had promised…”
The difference is that Putin probably actually has the money.
@John Goss; “If offended it was most likely this comment”
No John, I don’t think she would take any notice of anything from that particular Poster; if anything it’s more likely to be the Post I highlighted, in which she is rebuked by Craig, for something that she was correctly reporting, and the subsequent resulting lack of an apology; also it cannot have been pleasant for her that a person she obviously admires immensely, starts parroting the same deluded nonsense that a certain group have been hurling at her for the past year.
Ben
“Indeed, Mark. Who was it said the definition of insanity is doing the same activity to perpetuity, expecting different results?”
________________
Was that supposed to be a definition of the Eminences of this blog?
AK47s, Sukhoi jet fighters, tanks? 🙂
But I guess Craig means consumer goods:
http://www.britannica.com/EBchecked/topic/513251/Russia/38608/Manufacturing
Not a great exporter of consumer goods like China, but better in manufacturing for example than Australia? (We only ‘invade’ Papua New Guinea and Nauru to create gulags for refugees)
I have only deleted two comments – one for using a racist epithet, and one for accusing me of saying something I had never said. All of the comments which disagree with me are still there otherwise.
@reliably “resources and industry…over time…would seem to offer another path to prosperity”
If you think that mining and consumption has any long-term future in a global economy already doomed to runaway climate change then I hope you don’t have kids of your own to worry about.
Macky
Well, I’ve been rebuked by Craig as well and survived.
An internet discussion blog is no place for the excessively thin-skinned.
And anyway, it wasn’t Mary who asked for an apology – that was some one else, trying to stir up trouble.
Sadly, the model for Ukraine’s EU accession is not Poland but Greece: endemic corruption papered over for geopolitical reasons with the population subsequently made to pay with interest. EU accession under current conditions means old ladies eating out of garbage cans and jumping off the roofs.
And yes, it’s sad that Ukraine has a fake democracy. But for shits & grins I edited your post to globally replace Putin with Pritsker and Yanukovich with Obama, and it fit pretty damn good. Except Penny Pritsker installed her puppet with greater ease (after routine NSA surveillance and vetting.) The US has a fake democracy; Italy, Greece, Spain have fake democracies. The UK has pretty much dropped even the pretense of democracy.
Very true that Ukraine should not be the object of an EU-Russian tug of war. Why pick sides? Their best bet would be to join the G-77, with which their history and circumstances have much in common. Outside of UNO, which seems to be cut out of this deal, the G-77 is the most trustworthy source of capacity-building in self-determination and rights and rule of law.
“Durable consumer goods (e.g., refrigerators, washing machines, radios, and television sets) are produced primarily in areas with a tradition of skilled industry, notably in and around Moscow and St. Petersburg.”
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Here are 100 (devalued) Russian rubles that say the Kremlin buys German or Japanese 🙂
I’ve read that Uncle Joe’s (the Little Father’s) favorite piped were from Dunhill.
Not that this is relevant of course.
Pipes, not piped (sorry, I was choking on my Communist Havana when writing that).
Craig; You must have some rogue moderators.
On the original Ukraine thread (I think since it is not extant) I just wrote a warning wrt JTRIG sock-puppets protocols proscribe providing ANY information because it is too difficult to assess whether the information will be helpful to a target. Therefore it’s best not to provide ANY information. I didn’t mention any posters or refer to trolls, but Hab made a comment prior to my deleted. First the post was scrubbed and the comment ‘completely off topic’ was visible. Minutes later the entire presence was scrubbed.
Two deleted posts seemed too low a number.
Skintnick
““The EU has already agreed to match the US$19 billion in guarantees Putin had promised…”
The difference is that Putin probably actually has the money.”
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Witty, but not really relevant. Loan guarantees are what they say – guarantees. The guarantor only has to cough up when the guarantee actually defaults, you see. And, by the way, loan guarantees don’t come for free – the guarantee usually has to pay a fee.
But correct me if I’m wrong, some one.
Ben
“I didn’t mention any posters or refer to trolls, but Hab made a comment prior to my deleted.”
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So perhaps the moderator thought your post was an attack on me? Perish the thought!