The Next Stage in the Ukraine Crisis

By Elizabeth Pond

On Black Tuesday of this week soft economic power trumped hard military power for the first time since the Ukraine crisis began. The threatened meltdown of the Russian economy could put pressure on Russian President Vladimir Putin to dial down his undeclared war on Ukraine in return for some easing of Western financial sanctions.

Ever since masked armed men with no identifying insignia snatched Crimea from Ukraine last February the West has strived to avoid two contrary hazards. In a nuclear age it must shun any repetition of the sleepwalk into world war in 1914, when competitive, destabilizing mobilizations cascaded into disaster. But it must also avoid supine surrender of Europe’s most cherished achievement over seven decades in establishing on this war-prone continent a taboo on any nation’s seizure of another’s territory by force.

It was indeed the revolutionary peace order in Europe that Putin violated when he severed Crimea from Ukraine and annexed it, despite Moscow’s explicit commitment to non-violence in Europe in treaties going back to the 1975 Helsinki agreement. His landgrab shocked Europeans who had come to take post-modern reconciliation and peace for granted. Pundits concluded that their Kantian peace was no eternal verity after all, but only an interlude between eras of more normal violent international anarchy.

The immediate anti-sleepwalk reaction of Washington and the European Union was to rule out sending their own troops to defend non-NATO member Ukraine. But its corollary, intended to show that turning the other cheek militarily did not mean acquiescience in armed aggression, was to impose financial sanctions on Russian politicians and oligarchs close to Putin over Russia’s transgression of international law. Political scientists could hardly design a better experiment of a clash between short-term hard power and long-term soft power.

In fact, even though the annexation of Crimea gave Putin’s sagging popularity a chauvinist surge at home, Russia’s military juggernaut performed surprisingly poorly thereafter in advancing Putin’s claim to seigneurial privilege in Ukraine and wherever else Russian minorities live in “the Russian world.”  “I think we have done better than we realize,” former Swedish foreign minister Carl Bildt told a Berlin audience last week. The West’s diplomacy managed to limit Putin’s options, without resort to war, he maintained.

In Bildt’s analytical framework, Putin started this year with all of Ukraine as his client state, administered by the Russian president’s protégé, Ukrainian president Viktor Yanukovych. Yet the Russian president squandered this deep hegemony by overreach. The tenacious pro-democracy demonstrators in Kiev’s Independence Square, far from being cowed by the killing of a “heavenly hundred” of their number by riot police sniper fire in January and February–reportedly at Putin’s instigation–held their ground and even saw their ranks swell with new supporters. The shock of the deaths made Yanukovych’s own clientelist party desert him, and the disgraced president fled the country to Russian exile. Parliament appointed an interim president and government. “Chocolate king” oligarch Petro Poroshenko subsequently won the presidency in a landslide vote.

The ragtag Ukrainian army, after a poor start, learned how to fight on the job by resisting Russian takeover. Steady Western diplomatic engagement with Russia–based on the correct gamble that Putin wanted to reap victories through cheap “hybrid” warfare of irregulars led by Russian intelligence officers rather than through a messy direct invasion of Ukraine by Russian army regulars–gradually shifted the environment. Putin agreed–perhaps because he thought he could manipulate Poroshenko as he had manipulated the willing Yanukovych–to stop demonizing the newly elected president as the leader of an alleged fascist coup and to negotiate with him at the same table.

In July the Ukrainian army and allied militias began a serious counteroffensive that gradually reduced territory held by pro-Russian separatists to two enclaves in eastern Ukraine. In late August Putin signalled his red line: he would not tolerate a victory over his proxies by the upstart Ukrainian army. At that point he did send in paratroopers from airborne regiment 331 and other units in a direct invasion. The heavily armed professionals easily routed the Ukrainian forces in a few days.

President Poroshenko understood the kinetic message immediately. On September 5 he, Putin, representatives of the self-proclaimed People’s Republics of Donetsk and Luhansk, and an official of the Organization for Security and Cooperation in Europe (OSCE) as the monitoring agent agreed on a truce, a buffer zone, and closure of the Russian-controled bilateral border to further passage from Russia into Ukraine of heavy weapons and military personnel.

In the ten weeks since then no buffer zone has actually been implemented, and the Russian-Ukrainian border has not been closed. Yet the uneasy ceasefire has at least deescalated the violence and confined the exchange of shelling to the pre-existing battle line. Talks about talks to turn the truce into a more lasting ceasefire have started.

In Bildt’s view, Putin can hardly be happy with this shrinkage of his original claim on full Ukrainian allegiance to claims only on the eastern half of Ukraine under the resurrected 18th-century name of New Russia, and finally only on half of Ukraine’s two easternmost provinces.

The State of Play This Week

On Black Tuesday the ruble suddenly hit a new low at 50 percent of its value last January, capital flight continued to mount toward a 2014 high of $125 billion, and forecasts projected a likely drop in domestic product next year of close to 5 percent if oil continues to fetch only $60 per barrel. On the next day Putin and Poroshenko joined German Chancellor Angela Merkel and French President Francois Hollande in a joint late-night call to reconvene the “contact group” of Russia, Ukraine, and the OSCE as soon as possible. The group should turn the September 5 truce into a durable peace agreement, implement the already agreed buffer zone and exchange of prisoners, and allow Kiev to send desperately needed humanitarian help to needy civilians in the zone held by pro-Russian separatists, they prescribed.

The best Western guess now seems to be that Putin would like to deescalate fighting in Ukraine, either as a tactical pause or as an effort to stave off the financial meltdown that looms under the impact of sanctions and the plummeting price of Russia’s all-important hydrocarbon exports.

This new stage in the standoff between Russia and the West over Ukraine could be very dangerous, in part because of Putin’s impulsiveness, in part because of the lack of mutually understood constraints in a post-superpower but still nuclear world.

So far this year Putin’s default reaction to each setback–the implosion of Yanukovych, the sure-footedness of President Poroshenko, the stout performance of the Ukrainian army and militias, the failure of east Ukrainians to rally to the pro-Russian cause, the failure of German businessmen with lucrative Russian trade and investment deals to block Chancellor Merkel’s financial sanctions on Moscow, the counterproductive impact of Moscow’s new intimidation in alienating a Germany that has long been Russia’s best Western friend, in accelerating the EU drive to free Europe from its addiction to Russian energy, and in consolidating a still tentative sense of Ukrainian identity into a new conviction that Ukrainians have a common European calling–has been to resort to military threats. His assumption has been that he can raise the stakes with impunity because Moscow holds escalation dominance, thanks to geography and Russia’s raw military might.

Certainly Putin’s instinct today is still to up the ante by periodic nuclear saber-rattling and by aggressive Russian air and sea probes of NATO and non-NATO defenses in the Baltic, with transponders shut down. Yet with this week’s financial crisis in Russia, even Putin–who in the past has scorned Western sanctions as pinpricks–can no longer deny that the sanctions are wreaking serious damage on Russia’s economy and on the vast wealth that he and his inner circle have accumulated in the Russian kleptocracy. Far sooner than the authors of Western sanctions anticipated, the vector of soft long-term economic power has crossed the vector of hard short-term military power in the middle-term of real-time policy. “Only a Russian exit from Ukraine can begin to restore confidence,” concludes the Financial Times.

And, the paper might have added sotto voce, although it’s far too late by now for Vladimir Putin to get “off ramp” and still save face (as both President Barack Obama and Chancellor Angela Merkel repeatedly offered last spring and summer), it’s not too late for him to exit from Ukraine and save the Russian economy.

ELIZABETH POND is a Berlin-based journalist and the author of books on Russia and Europe.

A version of this blog appeared on the IP-Journal site of the German Council on Foreign Relations on December 17, 2014.

© Elizabeth Pond


The Bear In Winter

Four clues that Moscow may be ready to de-escalate the crisis in Ukraine

December 10, 2014  IP-Journal, German Council on Foreign Relations

by Elizabeth Pond

Russian President Vladimir Putin has been happy to ignore the consequences of his aggression in Ukraine so far, but there are signs that his endurance has reached a breaking point – particularly as Russia’s economy begins to sag under international pressure.

REUTERS/Mikhail Klimentyev/RIA Novosti/Kremlin

There is for the first time a glimmer of light at the end of the Ukrainian tunnel. Signs have begun to appear indicating that this year’s capital flight from Russia (totaling $130 billion), the ruble’s 38 percent plummet in value, and the drop in the price of the country’s all-important oil exports to under $70 per barrel may finally be convincing Vladimir Putin to take seriously the West’s financial sanctions, which he previously scorned as pinpricks.

Here are four clues that suggest that the Russian president may at last be ready to tone down his belligerence and tiptoe toward negotiations to restore stability to Europe.

Clue #1. This week Russia took a conciliatory step in agreeing jointly with Ukraine and the Organization for Security and Cooperation in Europe (OSCE) on a statement criticizing pro-Russian rebels in eastern Ukraine for refusing to join comprehensive peace talks. “Surprisingly Russia took Ukrainian side in this regard,” the Kyiv Post reported late Wednesday night. However, this gesture took place against a backdrop of intensified Russian air and sea probes of NATO and Swedish defenses in and around the Baltic Sea. The Kyiv Post also reported that Russian soldiers have now drawn back to Crimea from the Ukrainian side of the isthmus that separates Ukraine from the peninsula. According to German sources, some 40,000 Russian troops are now stationed on the peninsula.

Clue #2. Dmitri Trenin, head of the Carnegie Moscow Center, reads Putin’s “Urbi et Orbi” speech last week as a backpedalling from Moscow’s claims on the “Russian world”, and believes it indicates a very new focus on desperately needed domestic economic development.

Trenin, a shrewd insider-cum-outsider who served for 20 years in the Soviet and Russian military and then another 20 years in Russian and American think tanks, flags the conspicuous omission of familiar code words in Putin’s annual state-of-the-union address. The words “Russian world” (justifying Moscow’s right to protect Russians and even just Russian speakers militarily wherever they may be), “New Russia” (justifying Moscow’s claims on the whole eastern half of Ukraine dating back to Catherine the Great), and even “Donbas” (covering the Donetsk and Luhansk oblasts of Ukraine, which pro-Russian rebels largely control) are absent.

Moreover, Trenin floats the idea that the speech’s highlighting of Khersones as “a Temple Mount-like sacred place for Russians” might be substituting Crimea for the more traditional Kiev as the revered birthplace of Russia, thus signaling a subtle softening of Putin’s boast in August that Russian troops could take over Kiev in two weeks if they wished. This interpretation differs sharply from some Western media speculation that his words threatened instead a religious crusade for the Russian Orthodox faith.

Trenin also points to Putin’s emphasis on rescuing the Russian economy – a priority that the president has in the past year always subordinated to ultranationalism, strength of political will, and the unquestioned capacity of Russians for suffering. “Putin has decided ‘not to waste a good crisis,’ and wants to use the challenge of Western sanctions and the low oil price as leverage for the country’s economic revival,” Trenin writes.

His “most serious and glaring weakness in his 15 years in power has been his failure to come up with a realistic strategy of economic development,” Trenin continues. But now Putin is showing that he urgently needs to reform the economy – and these initiatives won’t succeed unless they are “backed up by genuine political will to make the legal system produce justice for all, and by a sustained effort to severely reduce institutionalized corruption. Government transparency and accountability is another indispensable condition.”

Clue #3. In closely-held high-level talks, Moscow and Kiev are struggling to turn the fragile September 5 truce in eastern Ukraine into a durable de-escalation of violence.

Here Trenin offers the first leaks that have come out of the bilateral talks. He reports that “the ongoing private dialogue between Moscow and Kiev indicate[s] that Russia is seeking to stabilize its ‘Ukrainian front'” – instead of expanding its military control in eastern Ukraine beyond the Donbas – on the basis of a “formula: Crimea is ours; Eastern Ukraine is Ukrainian (on certain conditions).”

This week’s effort to turn the uneasy truce of the last ten weeks in eastern Ukraine into a more durable ceasefire – by observing a “day of silence” for weapons on December 9, and preparing for implementation of the originally agreed non-militarized buffer zone – might be seen as confirming Trenin’s thesis. The failure to clear the buffer zone of artillery and other heavy weapons and the refusal on the part of the rebels to let unarmed observers from the Organization for Security and Cooperation in Europe monitor the ongoing flow of heavy weapons and military personnel over the Russia-controlled border into Ukraine have been conspicuous violations of the September 5 pact, however.

Clue #4. The costs of belligerence for Russia are mounting.

Putin has thus far ignored the freezing of Western investment and the other economic costs incurred by Moscow’s violation of international and treaty law. However, his aggression has produced a number of counterproductive effects: it has united Ukrainians, including eastern Ukrainians, against Russian encroachment, and rallied NATO to defend its members against daily Russian incursions into sovereign sea- and airspace in the Baltics and elsewhere. It has triggered unrest and unease in Chechnya, and even Kazakhstan and Belarus. And it has carried intangible social costs, driving many of the best and brightest young Russians abroad to pursue their careers. Perhaps most poignantly, Putin has repressed the Committees of Soldiers’ Mothers for painstakingly identifying dead Russian soldiers killed in his undeclared war on Ukraine, soldiers his army has buried secretly.

There are signs that Russian society is now more aware of the cost of Putin’s most recent war. The Levada Center, one of Russia’s last remaining independent pollsters, recently found that Russians’ sense of the “triumph of justice” (31 percent in March) and national “pride” (34 percent in March) were greatly diminished in light of Russia’s Ukraine policy: Now only 10 percent of respondents saw justice as having triumphed, and only 18 percent felt pride. “Joy” was at 4 percent, from 19 percent in March.

A month ago Dmitri Trenin was far more pessimistic than he is today. Then, he expected the “US-Russian crisis” to “become a permanent state.” He found the current confrontation more dangerous than the Cold War, since it “lacks agreed, if unwritten, rules, is characterized by gross asymmetry in power, and is utterly devoid of mutual respect. There is also a near-universal lack of strategic thinking. It is thus more prone…to lead to a collision in the style of [the rush to World War I in] 1914.”

Today, Trenin still expects the conflict between Russia and the West to continue for many years. But he contends that “even a partial accommodation in, with and over Ukraine would push back the danger of an all-out hot war in Europe’s east.”

Dmitri Trenin’s analysis offers Putin an alternative, less belligerent narrative if the Russian president does decide that he, too, wants to push back the danger of an all-out hot war.

(NB. This post was updated on December 12, 2014, in light of new developments.)

ELIZABETH POND is a Berlin-based journalist and the author of books on Russia and Europe.

A version of this essay is also posted on the website of the Atlantic Council.

© Elizabeth Pond


Two Races Against Time

Kiev must implement painful reforms fast, Moscow weigh the cost of continued aggression

IP Journal, German Council on Foreign Relations  December 2, 2014

by Elizabeth Pond

Is there going to be a winter respite in Russia’s undeclared war on eastern Ukraine? If so, the newly elected government in Kiev must lose no time laying out the foundations for ending the incestuous system of corrupt political, economic, and criminal power in Ukraine. Moscow, meanwhile, can play a waiting game in the hope that Western opinion will eventually acquiesce to its land grab and incursions.

REUTERS/Antonio Bronic

At this point the best Western guess seems to be that Russian President Vladimir Putin probably will not order a new larger-scale invasion of Ukraine by elite Russian troops in the next two months. If so, the stage is now set for parallel races against time by the Ukrainian and Russian adversaries.

In Kiev, the pro-European parties that won a two-thirds constitutional majority of parliamentary seats a month ago must implement painful reforms fast – and eschew fratricide – if they are not to squander the country’s last chance to escape Ukraine’s post-Soviet kleptocracy, economic meltdown, and further dismemberment by Russia.

In Moscow, Putin must weigh the costs and benefits of declaring victory and stabilizing his conquests to date or following his 2014 pattern of escalating militarily whenever he gets partially stymied in his undeclared war on Ukraine. The former course might conceivably let Moscow reset civil relations with Europe, rejoin the global economy it is now being squeezed out of, and get some easing of Western travel and financial sanctions imposed on Russians involved in seizing Crimea and two provincial capitals in eastern Ukraine. The latter course could subject Moscow to expanding damage from those sanctions on the Russian economy, the personal wealth of the president’s inner circle, and perhaps even domestic unease over the taboo loss of life of Russian soldiers in a war that Putin insists Russia is not waging.

Putin is banking, however, on rescue by a countervailing race against time in the West – the popular tendency to forget Russia’s stunning military aggression in Ukraine as long as there are no reminders of it in major new battles or catastrophes like the shooting down in July of a Malaysian civilian flight MH17 over separatist territory. “Putin thinks time is on his side,” comments a German official involved in shaping policy toward Russia. Already some Americans, out of a realist respect for the lopsided correlation of forces between the Russian Goliath and the Ukrainian David, and some Germans, out of realism, their post-World War II “culture of restraint,” and concern for German exports and jobs, are calling for an end to sanctions and Western acquiescence in Russian incursions or even formal recognition of Russia’s annexation of Crimea.

Western and Ukrainian hope for a winter respite is no more than a guess, of course. Putin prides himself on being unpredictable and is keeping all his options open. No Western analyst is sure that Russian troops won’t again invade Ukraine directly as they did at the end of August, when they routed the Ukrainian army in the east virtually overnight and thwarted the impending defeat of pro-Russian proxies there. Yet recent weeks of steady transport of Russian heavy weapons and military personnel over the open Russian-Ukrainian border – by now Ukrainian government estimates put the number of Russian troops in unmarked uniforms in eastern Ukraine at 10,000 – have at least not spread the geography of the localized fighting in Donetsk, Luhansk, and Mariupol that has persisted since the uneasy September 5 truce was signed.

The relative de-escalation of fighting in the Donetsk-Luhansk (Donbas) area in the three months of that imperfect truce might be attributed to the Russian army’s conscription cycle, the weather, the suicidal determination of the Ukrainians to resist further loss of their territory to the Russian juggernaut, and warnings by independent Russians that occupying Ukrainian territory would require far more troops than seizing it, especially if Ukrainians revived their tradition of stubborn guerrilla warfare of the 1940s.

To be sure, these considerations – along with Moscow’s current charm offensive to win a cuddlier image in the public policy debate that has now opened in Germany – do not constitute any robust deterrence to deeper Russian incursion into eastern Ukraine. Russia enjoys escalation dominance by virtue of geographical proximity, possession of ultimate nuclear weapons, and Putin’s will, along with the West’s public refusal to start World War III to defend a state that is not a NATO member. Yet the considerations do at least raise inhibitions that could delay the offensive that Moscow hardliners are advocating to build a land route along the Azov Sea coast to the annexed Crimean peninsula, seize Ukraine’s Black Sea port of Odessa, and even take over Kharkiv in the north.

Thus, if the last comparable rotation of Russian recruits in May is any guide, Moscow will want to hold off any offensive until new draftees have been broken in. Last spring the Russian army massed up to 80,000 troops on high alert on the Ukrainian borders in the guise of maneuvers for more than a month. Apart from infiltrating a fairly small unit of commandos under Russian Col. Igor Strelkov in the (unrequited) hope of igniting a general uprising among locals in eastern Ukraine, however, Moscow refrained from a direct invasion at the time. It was only when the Ukrainian army and allied volunteer militias regained lost territory last summer and pushed Strelkov’s team and local acolytes back into two enclaves that Putin declared his red line by sending in Russian paratroopers to crush the Ukrainians and save his proxies from surrender.

Mission Impossible?

It would be hard even in peacetime to reform the dysfunctional post-Soviet kleptocratic disorder of a nation that ranks 144 (below Russia’s 127) on a list of 177 countries on Transparency International’s chart of perceived corruption. It would seem to be a mission impossible under the ever-growing threat of Russian guns in the two-month breather that may or may not now be available for creative destruction of existing parasitic power networks and radical institution building.

As Ukraine’s newly elected government takes office this week, President Petro Poroshenko describes the challenge as an existential one of “to be or not to be.” Poroshenko pledges, as he stressed in an interview with German television, that the coalition government of five pro-European parties will carry out root-and-branch military, political, judicial, and economic reforms to achieve democratic transparency and fairness and qualify Ukraine to apply for European Union membership by 2020. “If necessary, we’ll sleep with a revolver under our pillow,” he added.

The one factor that gives Poroshenko’s promise a glimmer of hope is the shock that Putin’s land grabs administered both to the West and to Ukrainians in the undeclared war that has by now claimed more than 4,300 deaths, wounded almost 10,000, and made 1.2 million Ukrainian citizens homeless, according to the latest United Nations data. The initial disbelief that their older East Slav brothers could actually shoot down younger Ukrainian brothers on Ukrainian territory has shifted in less than a year to anger, a determination to resist armed takeover despite the dismal military odds, and extraordinary private initiatives to support the poorly equipped Ukrainian army and militias with everything from kasha and socks to home-made body armor.

“Ukraine and the Ukrainians were never before as unified as they are now,” Poroshenko told German TV broadcaster ARD over the weekend. “More than 68 percent of citizens today call for Ukraine to become a member of the European Union.” The fallen “died for our right to be Europeans.”

But will that new-found solidarity suffice to prevent a repetition of the scramble for personal riches that alienated the public from Ukrainian politics in the early years of post-Soviet independence in the 1990s? Will it immunize today’s politicians against the bitter internal power struggles that doomed the would-be liberal reformers of 2004 in the second attempt to escape Ukraine’s Soviet past? And could it achieve this transformation before the Russian military machine has torn out another segment of Ukraine?

The answer to these questions lies only in part with the shock that Putin’s violation of international law and Russian-signed treaties has given a European Union that has prided itself on having created seven decades of post-World War II reconciliation and peace on a historically bloody continent. This shock convinced the European paymaster of Germany to reject Russia’s forcible change of borders and to spend “whatever it takes” to preserve Ukrainians’ “right to be Europeans.”

Yet in the end German and EU readiness to help Kiev depends on the ability of the Ukrainian government and society to lay out, fast, the foundations for ending the incestuous system of corrupt political, economic, and criminal power and build robust institutions that can resist its restoration. Outsiders can advise Ukrainians, but only the Ukrainians themselves can supply the determination to achieve this goal, and to achieve it at warp speed.

ELIZABETH POND, a Berlin-based journalist and author, first covered Ukraine in the 1960s.

© Elizabeth Pond