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Spengler

Ukraine Is Hopeless … but Not Serious

March 1st, 2014 - 4:54 pm

There isn’t going to be a war over Ukraine. There isn’t even going to be a crisis over Ukraine. We will perform our ritual war-dance and excoriate the Evil Emperor, and the result would be the same if we had sung “100 Bottles of Beer on the Wall” on a road trip to Kalamazoo. Worry about something really scary, like Iran.

Ukraine isn’t a country: it’s a Frankenstein monster composed of pieces of dead empires, stitched together by Stalin. It has never had a government in the Western sense of the term after the collapse of the Soviet Union gave it independence, just the equivalent of the family offices for one predatory oligarch after another–including the “Gas Princess,” Yulia Tymoshenko. It has a per capital income of $3,300 per year, about the same as Egypt and Syria, and less than a tenth of the European average. The whole market capitalization of its stock exchange is worth less than the Disney Company. It’s a basket case that claims to need $35 billion to survive the next two years. Money talks and bullshit walks. Who wants to ask the American taxpayer for $35 billion for Ukraine, one of the most corrupt economies on earth? How about $5 billion? Secretary of State Kerry is talking about $1 billion in loan guarantees, and the Europeans are talking a similar amount. That’s not diplomacy. It’s a clown show.

Ukraine’s revolution is odd, even by recent standards. The deposed premier Viktor Yanukovych won the 2010 presidential election against Yulia Tymoshenko, after Tymoshenko’s “Orange Revolution” regime made a ghastly mess of everything. Yanukovich made matters worse. Clearly a lot of Ukrainians got together at Maidan square, ranging from democratic idealists to rent-a-mob demonstrators paid by Ukrainian oligarchs to the sort of hoodlums who think the other side should have won the Second World War. What sort of regime do we have now? As CNN reported Feb. 27, there is

Arseniy Yatseniuk, 39, named as Prime Minister and a practiced politician who has been the chief opposition voice at Maidan Square. While closely associated with former Prime Minister Yulia Tymoshenko — who was freed from prison in the wake of last week’s protests — he can at least do business with the West and talk tough with hard-nosed IMF suits. A realist, on Wednesday he warned that the new government will need to invoke some very unpopular decisions, given the dire state of the economy. “We are a team of people with a suicide wish — welcome to hell,” he said.

Ukraine’s economy is close to Egypt’s in per capital GDP, and its governance is similar: desperately poor people can’t make it through the day without government subsidies, especially for energy. The oligarchs have looted the country so that it has to borrow money from foreigners to maintain the subsidies, leaving Ukraine with $137 billion in foreign debt, and a need to borrow an additional $20 billion a year. Putin offered just under $20 billion in cash and subsidies, and Yanukovych accepted his offer. The alternative was maybe $15 billion from the IMF provided that Ukraine cut subsidies first. Yanukovych, who is neither a Ukrainian patriot nor a Russian stooge, but a man on the make, decided he couldn’t sell the austerity package. That’s why he went with Russia. For the demonstrators at Maidan square, staying in the Russian orbit meant more of the same misery. Some of them decided they would rather die than live that way, which is perfectly understandable. But what precisely to they expect to get from the Europeans, let alone the U.S.? Finding $35 billion of taxpayers’ money has a vanishingly small probability.

Putin bungled things badly: he thought a bailout would solve the problem. That blew up in his face. The West bungled things badly: it has a $35 billion bill on its desk and no intention of paying it. John McCain went to Maidan in December and said the American people were with the Ukrainian demonstrators. He meant in spirit, not in their capacity as taxpayers. The Ukrainian opposition didn’t bungle so much as take a collective bungee jump without a cord. Just what do they propose to do now?

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Top Rated Comments   
Many of the Ukes helped round up their Jewish neighbors for the Nazis. That's about all that Mr. Goldman is ever going to remember about the former Ukranian nation.

The main geo-political ramification of this debacle will be that no nation will ever give up their WMDs based on a promise by the western powers. Also, Israel now sees how completely worthless Obamas assurances are, and will commence to defending ITSELF sometime soon I suspect.
24 weeks ago
24 weeks ago Link To Comment
"Putin bungled things badly: he thought a bailout would solve the problem."

Why wouldn't he expect that?
It worked with Cyrus.
(You do know that, don't you?)

"As for the Crimea: Did anyone seriously think that Vladimir Putin would let the main port of Russia’s Black Sea fleet fall into unfriendly hands?"

The last time Russia was challenged over that, they kept the city but lost the fleet. Of course that required actually standing up to them and not just shrugging and walking away.

"Russia will take the Crimea, and the strategic consequences will be nil."

Surely you can't be serious.
It is difficult to even know where to begin with how many possibilities open up:
1. Putin won't be satisfied with just the Crimea and will also take the Ukrainian portion of the Donbas.
2. 250,000+ Crimean Tatars will become refugees. Or perhaps they will just "radicalize" and join the jihad going on in the Caucasus.
3. 500,000 Ukrainians in Crimea will become refugees, putting a burden on Ukraine and the EU at a wonderfully wrong moment.
4. The above two will be aggravated if Putin seizes the Donbas as well, along with the Russians who will be under great pressure to abandon homes in Ukraine.
5. Putin will see there is nothing to hinder him in making demands in regards to Transnistria, whether it be recognition of its independence or outright annexation. That will of course further degrade the defensive situation in the rump of Ukraine.
6. Putin will see there is nothing to hinder him in whatever other demands he wishes to make in expanding his Eurasian Union, effectively recreating the Russian Empire. Or is that the Soviet Union?
7. The U.S. and U.K. will lose considerable diplomatic "face" over the Budapest Memorandum, much as the U.K. and France looked stupid and found themselves "forced" to declare war after the dissolution of Czechoslavakia and declaration of war on Poland in 1938 and 1939.
8. The fallout from that will be even more severe when it comes to getting countries to give up their WMD in exchange for "guarantees". That will go down especially well in Syria, which of course Putin will be in an even better position to supply.
9. The EU will lose standing for not bailing Ukraine out.
10. NATO will lose standing, particularly with the former Warsaw Pact countries, and more with the Baltic states who have Russian minorities to deal with.
11. Putin will gain a major victory overall, making it much easier for him to promise help to others who see that no one will stand up to him.
12. China will note the utter lack of resolve on the part of the U.S. and advance its claims in the South China Sea and the Senkaku Islands.

No strategic consequences . . .

"Lviv and Sevastopol have about as much in common as, say, Bogota and Montreal."

The people in Lviv and Sevastopol speak mutually intelligible languages/dialects. The people of Bogota and Montreal do not.
The people in Lviv and Sevastopol have been part of the same country for at least some period. The people of Bogota and Montreal never have been.
The people in Lviv and Sevastopol share similar traditions in government. The people in Bogota and Montreal did up until Montreal came under British Common Law rules and Bogota became subject to the vagaries of the colonial Hispanosphere, making them pretty much completely different at this time.
24 weeks ago
24 weeks ago Link To Comment
You could have at least found a nice thing or two to say about the Ukrainians. Once Obama gets done with America, we would want someone to say a nice thing or two about us.
24 weeks ago
24 weeks ago Link To Comment
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All Comments   (155)
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QUESTION: You have written extensively about Iran's declining birth rate and how that motivates their hegemonic urges. Did you know their declining birth rate is the result, in part, or government policy? http://www18.georgetown.edu/data/people/mk556/publication-33109.pdf
The Iranian government feels that having fewer Iranians will mean a better material life for all. Does that fact comport with your oft stated theory that "dying" nations are more dangerous? You have written that Russia - under Putin, and due in part to his policies - has a growing birth rate; yet... they seem more hegemonic, not less. Please explain. Mexico's birth rate is in steady decline - http://www.indexmundi.com/g/g.aspx?c=mx&v=25 -, yet they seem no more hegemonic. Does that fact comport with your oft stated theory that "dying" nations are more dangerous? Please explain. America's birth rate is declining, and yet we are shrinking in world influence and in our ability to influence events. Does that fact comport with your oft stated theory that "dying" nations are more dangerous? Please explain, Why does a declining national birth rate not seem to have the same effect in every nation? Could it be that something else is at play - and is more important? I think so.
23 weeks ago
23 weeks ago Link To Comment
Watch the world's stock markets which shrugged off Ukraine sideshow entirely. Der Spiegel's headline on diplomatic efforts to isolate Russia: "Stunde der Holzkoepfe," which means roughly, "Pinhead Time." Nothing to see here, folks. Keep moving.

24 weeks ago
24 weeks ago Link To Comment
As long as the crisis does not adversely impart their thriving hot model export business most of the world will never notice.
24 weeks ago
24 weeks ago Link To Comment
The hard truth is that when the Soviet Union collapsed, the West staked out positions far in advance of what it was able and willing to defend. Most of Ukraine was part of Tsarist Russia and spent 70 years under Bolshevik rule. It shares a common history with Russia and a common dysfunctional post-Communist culture. The exception is Western Ukraine which Stalin invaded in 1939. Which countries were allowed to join NATO and why? I think there were good reasons to exclude Ukraine and to include the Baltic states.

That said, Putin must pay a price.
24 weeks ago
24 weeks ago Link To Comment
Thank you, Sir. Finally a voice worth listening to. The media is so full of nonsense that it is frightening. There is one thing that you said that I would emphasize, and that is Viktor Yanukovych, no matter his qualities, won the 2010 presidential election and still remains the legal head of the Ukrainian State. There was no revolution in Ukraine that is why it seems odd. What we watch is a coup d'état. Offering the US and the EU support to the neo-Nazis who are taking power from a legally elected leader and calling it a “democracy” may come to haunt us eventually. Not to mention we have no feasible stake in the fight. Thinking for a moment that Vladimir Putin will risk losing military base in Sebastopol to these people and allowing far-right nationalists from Western Ukraine to carry out ethnic cleansing in the Crimea is ludicrous. We can send the peace keepers if there will be UN sanction, but do we really want to waste more of the American lives on a fight with no cause?
24 weeks ago
24 weeks ago Link To Comment
The Ukraine Parliament did in fact dimiss Yanokovich, and that well may be a legal removal of a president -- I don't know Ukrainian constitutional law well enough to judge. As a democracy, though, Ukraine surely is a couple of beers short of a sixpack.
24 weeks ago
24 weeks ago Link To Comment
then why say this: "It’s obvious that the Ukrainians have no faith in their democratic institutions, having staged a coup against a democratically elected president." in fact; the election was stolen as it was in Egypt, and the Ukrainians were right to rise up. This wasn't a coup against a legitimate government; it was a revolution against an illegitimate one and as morally just and legal as ours. You might as well question the legality of the American or French revolutions as question theirs.
23 weeks ago
23 weeks ago Link To Comment
No, it is not legal - it was not done according to impeachment procedure as defined by Ukrainian constitution.
24 weeks ago
24 weeks ago Link To Comment
The difference between Ukraine and Egypt is that Ukraine can feed itself. Egypt can't.
24 weeks ago
24 weeks ago Link To Comment
Yes, but it also has a c.a. deficit of around 8% of GDP and imports all its energy. It's not Egypt. Just the next worst thing.
24 weeks ago
24 weeks ago Link To Comment
As many here have said, Mr. Spengler, how do you not comment on how this plays to the world? It's not a question of the Ukrainians, per se - it's a question of Putin showing that the USA is, indeed, a paper tiger - and that NATO is a paper butterfly.

Barack Obama has accomplished what he set out to do. He has brought us very close to the EU in so many ways - including the value of our word on the international stage, and the strength of our spine.

Joe Biden famously said that Barack Obama had a "spine of steel." Once again Crazy Joe embarasses himself and the nation.

Obama doesn't want to honor the Oval Office by wearing a suit. That's his decision, and he can make it. If only he didn't wear a diaper, because that reflects on all of us.

Obama has bungled each and every foreign relationship. That's what this is about - another complete failure of this Administration, and further proof that Europe is (once again) ripe for domination.
24 weeks ago
24 weeks ago Link To Comment
I’m glad I already have a government (not that I like it) and prosperous economy, or Spengler would confine to an everlasting hell, too.


Ukrainians (that is, those who speak Ukrainian) have as much right to a homeland as any people. Their history of maltreatment at the hands of Russians means every people who has homeland where they can be safe and free should be for an independent Ukraine.


Before I agree that Iran is a greater threat than Russia or China, could you summarize the last five years of your predictions on Iran? I’d like to check your judgment.


McCain’s a bigger fool than I ever thought. Empty grandstanding only works at home.
24 weeks ago
24 weeks ago Link To Comment
Just reading Der Spiegel's website: "Washington Clueless." Frau Merkel called Putin and told him off, but the Germans counsel against diplomatic isolation of Russia, because "dialogue is better." What a joke. I'm also reating the Russian spin at rt.com, warning of a "humanitarian crisis" in Ukraine -- and that's just what we are going to have as the West fiddles with IMF conditions for the broken hulk of the Ukraine economy. Ukraine exports industrial products to Russia -- the West doesn't want or need much of what it makes. This is going to get messier and messier by the day. Maybe the West will come up with a massive aid package, but I wouldn't bet on it.
24 weeks ago
24 weeks ago Link To Comment
Frau Merkel, where are your divisions? Where is your might and backbone, here? Why isn't the EU leading the charge, since they are the counterbalance to Russia in this situation. Half of Ukraine wants to be EU-centric, the other half wants Russia.

Russia has stepped up and claimed it's half... where is Merkel and Hollande and that group, doing the same?

Is NATO the only alliance that matters? Does the EU not have defense interests outside of the USA?

Putin isn't embarassing the USA - he's embarassing NATO and every other Western country.

If China isn't looking at this and taking notes about their own standoff with Japan...
24 weeks ago
24 weeks ago Link To Comment
sorry, but the eastern former soviet republics never were under french sphere of influence, we'll leave that to Merkel and to the US state Department

if the Soros organisations (and McCain's) hadn't pushed the ukrainians to rebellion, probably that today the whole lot would have accepted the 15 billion dollars offered by Putin, since the EU and the US haven't the means to make it, anyways itwould have been like betting on a loosing horse, the oligarcs would have filled their pockets like they did with the IMF money before

I bet that Poland will regret soon to have interferred into inner Ukraine affairs when she'll get the thousands of illegal economical refugies from the euroMaidan goverment

Still it's a pity for the little populo
24 weeks ago
24 weeks ago Link To Comment
More important is America's weakness in the face of the meltdown in the Middle East. That is actually Serious; as is the increasing Chinese presence in the Pacific. The American government and people believe that War is (for them) optional. Well, it ain't.

But Obama is off to another fund raiser.
24 weeks ago
24 weeks ago Link To Comment
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