Why Putin Is Afraid of Ukraine

From – http://www.newsweek.com/why-putin-afraid-ukraine-332276

On March 24 last year, I was in my Toronto kitchen preparing school lunches for my kids when I learned from my Twitter feed that I had been put on the Kremlin’s list of Westerners who were banned from Russia. This was part of Russia’s retaliation for the sanctions the United States and its allies had slapped on Vladimir Putin’s associates after his military intervention in Ukraine.

Four days earlier, nine people from the U.S. had been similarly blacklisted, including John Boehner, the speaker of the House of Representatives, Harry Reid, then the majority leader of the Senate, and three other senators: John McCain, a long-time critic of Putin, Mary Landrieu of Louisiana and Dan Coats of Indiana, a former U.S. ambassador to Germany. “While I’m disappointed that I won’t be able to go on vacation with my family in Siberia this summer,” Coats wisecracked, “I am honored to be on this list.”

I, however, was genuinely sad. I think of myself as a Russophile. I speak the language and studied the nation’s literature and history in college. I loved living in Moscow in the mid-1990s as bureau chief for the Financial Times and have made a point of returning regularly over the subsequent 15 years.

I’m also a proud member of the Ukrainian-Canadian community. My maternal grandparents fled western Ukraine after Hitler and Stalin signed their non-aggression pact in 1939. They never dared to go back, but they stayed in close touch with their brothers and sisters and their families, who remained behind.

For the rest of my grandparents’ lives, they saw themselves as political exiles with a responsibility to keep alive the idea of an independent Ukraine, which had last existed, briefly, during and after the chaos of the 1917 Russian Revolution. That dream persisted into the next generation, and in some cases the generation after that.

My late mother moved back to her parents’ homeland in the 1990s when Ukraine and Russia, along with the 13 other former Soviet republics, became independent states. Drawing on her experience as a lawyer in Canada, she served as executive officer of the Ukrainian Legal Foundation, an NGO she helped to found.

My mother was born in a refugee camp in Germany before the family immigrated to western Canada. They were able to get visas thanks to my grandfather’s older sister, who had immigrated between the wars. Her generation, and an earlier wave of Ukrainian settlers, had been actively recruited by successive Canadian governments keen to populate the vast prairies of Manitoba, Saskatchewan and Alberta.

Today, Canada’s Ukrainian community, which is 1.25 million strong, is significantly larger as a percentage of total population than the one in the United States, which is why it is also a far more significant political force. And that in turn probably accounts for the fact that, while there were no Ukrainian-Americans on the Kremlin’s blacklist, four of the 13 Canadians singled out were of Ukrainian extraction: in addition to myself, my fellow Canadian Member of Parliament James Bezan, Senator Raynell Andreychuk and Paul Grod, who has no national elective role but is head of the Ukrainian Canadian Congress.

I made the Russian list of the unwelcome as a three-fer: an activist Ukrainian-Canadian, a politician (I was elected to the Canadian Parliament in 2013 to represent Toronto Centre) and a journalist with a long paper trail that frequently displeased the Kremlin, since I covered Moscow’s brutal war in Chechnya in the 1990s and also wrote a book about the rise of the Russian oligarchs.

I interviewed Putin himself in 2000, shortly after he took over as president. When, in 2011, he decided to take the presidency back from his protégé, Dmitry Medvedev, I wrote a column in The New York Times arguing that Putin’s Russia was on its way to becoming a full-fledged dictatorship that would eventually be vulnerable to a popular uprising.

Until March of last year, none of this prevented my getting a Russian visa. I was, on several occasions, invited to moderate panels at the St. Petersburg International Economic Forum, the Kremlin’s version of the World Economic Forum in Davos. Then, in 2013, Medvedev agreed to let me interview him in an off-the-record briefing for media leaders at the real Davos annual meeting.

That turned out to be the last year when Russia, despite its leadership’s increasingly despotic and xenophobic tendencies, was still, along with the major Western democracies and Japan, a member in good standing of the G-8. Russia in those days was also part of the elite global group Goldman Sachs had dubbed the BRICs—the acronym stands for Brazil, Russia, India and China—the emerging market powerhouses that were expected to drive the world economy forward.

Putin was counting on the $50 billion extravaganza of the 2014 Sochi Winter Olympics to further solidify Russia’s position at the high table of the international community.

President Viktor Yanukovych’s flight from Ukraine in the face of the Maidan uprising, which took place on the eve of the closing day of those Winter Games, astonished and enraged Putin. In his pique, as Putin proudly recalled in a March 2015 Russian government television film, he responded by ordering the takeover of Crimea after an all-night meeting.

That occurred at dawn on the morning of February 23, 2014, the finale of the Sochi Olympics. The war of aggression, occupation and annexation that followed turned out to be the grim beginning of a new era, and what might be the start of a new cold war, or worse.

Putin’s big lie

The crisis that burst into the news a year-and-a-half ago has often been explained as Putin’s exploitation of divisions between the mainly Russian-speaking majority of Ukrainians in the eastern and southern regions of the country, and the mainly Ukrainian-speaking majority in the west and center. Russian is roughly as different from Ukrainian as Spanish is from Italian.

While the linguistic factor is real, it is often oversimplified in several respects: Russian-speakers are by no means all pro-Putin or secessionist; Russian- and Ukrainian-speakers are geographically commingled; and virtually everyone in Ukraine has at least a passive understanding of both languages.

To make matters more complicated, Russian is the first language of many ethnic Ukrainians, who are 78 percent of the population (but even that category is blurry, because many people in Ukraine have both Ukrainian and Russian roots). President Petro Poroshenko is an example—he always understood Ukrainian, but learned to speak it only in 1996, after being elected to Parliament; and Russian remains the domestic language of the Poroshenko family.

The same is true in the home of Arseniy Yatsenyuk, Ukraine’s prime minister. The best literary account of the Maidan uprising to date was written in Russian: Ukraine Diaries, by Andrey Kurkov, the Russian-born, ethnic Russian novelist, who lives in Kiev.

In this last respect, my own family is, once again, quite typical. My maternal grandmother, born into a family of Orthodox clerics in central Ukraine, grew up speaking Russian and Ukrainian. Ukrainian was the main language of the family refuge she eventually found in Canada, but she and my grandfather spoke Ukrainian and Russian as well as Polish interchangeably and with equal fluency.

When they told stories, it was natural for them to quote each character in his or her original language. I do the same thing today with Ukrainian and English, my mother having raised me to speak both languages, as I in turn have done with my three children.

For individual Ukrainians, though less often for the country as whole, this linguistic kinship has sometimes been an advantage. Nikolai Gogol, known to Ukrainians as Mykola Hohol, was the son of a prosperous Ukrainian gentleman farmer. His first works were in Ukrainian, and he often wrote about Ukraine.

But he entered the international literary canon as a Russian writer, a feat he is unlikely to have accomplished had Dead Souls been written in his native language. Many ethnic Ukrainians were likewise successful in the Soviet nomenklatura, where these so-called younger brothers of the ruling Russians had a trusted and privileged place, comparable to the role of Scots in the British Empire.

But familiarity can also breed contempt. Russia’s perceived kinship with Ukrainians often slipped into an attempt to eradicate them. These have ranged from Tsar Alexander II’s 1876 “Ems Ukaz,” which banned the use of Ukrainian in print, on the stage or in public lectures and the 1863 Valuev ukaz that asserted that “the Ukrainian language has never existed, does not exist, and cannot exist,” to Stalin’s genocidal famine in the 1930s.

In short, being a Russian-speaker in Ukraine does not automatically imply a yearning for subordination to the Kremlin any more than speaking English in Ireland or Scotland means support for a political union with England. As Kurkov writes in his Diaries: “I am a Russian myself, after all, an ethnically Russian citizen of Ukraine. But I am not ‘a Russian,’ because I have nothing in common with Russia and its politics. I do not have Russian citizenship and I do not want it.”

That said, it’s true that people on both sides of the political divide have tried to declare their allegiances through the vehicle of language. Immediately after the overthrow and self-exile of Yanukovych, radical nationalists in Parliament passed a law making Ukrainian the sole national language—a self-destructive political gesture and a gratuitous insult to a large body of the population. However, the contentious language bill was never signed into law by the acting president.

Many civic-minded citizens also resisted such polarizing moves. As though to make amends for Parliament’s action, within 72 hours the people of Lviv, the capital of the Ukrainian-speaking west, held a Russian-speaking day, in which the whole city made a symbolic point of shifting to the country’s other language.

Less than two weeks after the language measure was enacted it was rescinded, though not before Putin had the chance to make considerable hay out of it.

The blurring of linguistic and ethnic identities reflects the geographic and historic ties between Ukraine and Russia. But that affinity has also bred, among many in Russia, a deep-seated antipathy to the very idea of a truly independent and sovereign Ukrainian state.

Russians see Ukraine as the cradle of their civilization. Even the name came from there: the vast empire of the tsars evolved from Kievan Rus, a loose federation of Slavic tribes in the Middle Ages.

The ties that bind are also contemporary and personal. Two Soviet leaders—Nikita Khrushchev and Leonid Brezhnev—not only spent their early years in Ukraine but spoke Russian with a distinct Ukrainian accent. This historic connectedness is one reason why their post-Soviet successor, Vladimir Putin, has been able to build such wide popular support in Russia for championing—and, as he is now trying to do, recreating—“Novorossiya” (New Russia) in Ukraine.

In selling his revanchist policy to the Russian public, Putin has depicted Ukrainians who cherish their independence and want to join Europe and embrace the Western democratic values it represents as, at best, pawns and dupes of NATO—or, at worst, neo-Nazis. As a result, many Russians have themselves been duped into viewing Washington, London and Berlin as puppet-masters attempting to destroy Russia.

Airbrushing the truth

This subterfuge is, arguably, Putin’s single most dramatic resort to the Soviet tactic of the Big Lie. Through his virtual monopoly of the Russian media, Putin has airbrushed away the truth of what happened a quarter of a century ago: the dissolution of the USSR was the result not of Western manipulation but of the failings of the Soviet state, combined with the initiatives of Soviet reformist leaders who had widespread backing from their citizens.

Moreover, far from conspiring to tear the USSR apart, Western leaders in the late 1980s and early 1990s used their influence to try to keep it together.

It all started with Mikhail Gorbachev, who, when he came to power in 1985, was determined to revitalize a sclerotic economy and political system with “perestroika” (literally, rebuilding), “glasnost” (openness) and a degree of democratization.

These policies, Gorbachev believed, would save the USSR. Instead, they triggered a chain reaction that led to its collapse. By softening the mailed-fist style of governing that traditionally accrued to his job, Gorbachev empowered other reformers—notably his protégé-turned-rival Boris Yeltsin—who wanted not to rebuild the USSR but to dismantle it.

Their actions radiated from Moscow to the capitals of the other Soviet republics—most dramatically Kiev. Ukrainian democratic reformers and dissidents seized the chance to advance their own agenda—political liberalization and Ukrainian statehood—so that their country could be free forever from the dictates of the Kremlin.

However, they were also pragmatists. Recognizing that after centuries of rule from Moscow, Ukraine’s national consciousness was weak while its Communist Party was strong, they cut a tacit deal with the Ukrainian political leadership: In exchange for the Communists’ support for independence, the democratic opposition would postpone its demands for political and economic reform.

By 1991, the centrifugal forces in the Soviet Union were coming to a head. Putin, in his rewrite of history, would have the world believe that the United States was cheering and covertly supporting secessionism. On the contrary, President George H.W. Bush was concerned that the breakup of the Soviet Union would be dangerously destabilizing. He had put his chips on Gorbachev and reform Communism and was skeptical about Yeltsin.

In July of that year, Bush traveled first to Moscow to shore up Gorbachev, then to Ukraine, where, on August 1, he delivered a speech to the Ukrainian Parliament exhorting his audience to give Gorbachev a chance at keeping a reforming Soviet Union together: “Americans will not support those who seek independence in order to replace a far-off tyranny with a local despotism. They will not aid those who promote a suicidal nationalism based upon ethnic hatred.”

I was living in Kiev at the time, working as a stringer for the Financial Times, The Economist and The Washington Post. Listening to Bush in the parliamentary press gallery, I felt he had misread the growing consensus in Ukraine. That became even clearer immediately afterward when I interviewed Ukrainian MPs, all of whom expressed outrage and scorn at Bush for, as they saw it, taking Gorbachev’s side.

The address, which New York Times columnist William Safire memorably dubbed the “Chicken Kiev speech,” backfired in the United States as well, antagonizing Americans of Ukrainian descent and other East European diasporas, which may have hurt Bush’s chances of re-election, costing him support in several key states.

But Bush was no apologist for Communism. His speech was heavily influenced by Condoleezza Rice, not a notable soft touch, and it echoed the United Kingdom’s Iron Lady, Margaret Thatcher, who, a year earlier, had said she could no more imagine opening a British embassy in Kiev than in San Francisco.

The magnitude of the West’s miscalculation, and Gorbachev’s, became clear less than a month later. On August 19, a feckless attempt by Russian hardliners to overthrow Gorbachev triggered a stampede to the exits by the non-Russian republics, especially in the Baltic States and Ukraine. On August 24, in Kiev, the MPs Bush had lectured three weeks earlier voted for independence.

Three months after that, I sat in my Kiev studio apartment—on a cobblestone street where the Russian-language writer Mikhail Bulgakov once lived—listening to Gorbachev’s televised plea to the Ukrainian people not to secede. He invoked his maternal grandmother who (like mine) was Ukrainian; he rhapsodized about his happy childhood in the Kuban in southern Russia, where the local dialect is closer to Ukrainian than to Russian. He quoted—in passable Ukrainian—a verse from Taras Shevchenko, a serf freed in the 19th century who became Ukraine’s national poet. Gorbachev was fighting back tears as he spoke.

That was November 30, 1991. The next day, 92 percent of Ukrainians who participated in a national referendum voted for independence. A majority in every region of the country including Crimea (where 56 percent voted to separate) supported breaking away.

Two weeks later, Ukraine’s President Leonid Kravchuk met Yeltsin, who by then was the elected president of the Russian Federation. The two of them, along with the president of Belarus, signed an accord that formally dissolved the Soviet Union.

Gorbachev, who’d set in motion a process that he could not control, had lost his job and his country. Down came the red stars on the spires, up went the Russian tricolor in place of the hammer-and-sickle. Yeltsin took his place in the Kremlin office and residence that Putin occupies today.

Therein lies a stunning double irony. First, Yeltsin—who plucked Putin from obscurity and hand-picked him as his successor—would not have been able to engineer Russia’s own emergence as an independent state had it not been for Ukraine’s eagerness to break free as well.

Second, the world would almost certainly never have heard of Putin had it not been for the dissolution of the USSR, which Putin has called “the greatest geopolitical catastrophe of the 20th century.”

Little reform, big corruption

Then came the hard part. Having broken up the Soviet Union, Moscow and Kiev both faced three immediate, vast and novel challenges: how to establish genuine statehood and independence for their brand new countries; create efficacious democracies with checks and balances and rule of law; and make the transition from the Communist command economy to capitalism.

Accomplishing all three tasks at once was essential, but it proved impossible. As a result, like Tolstoy’s unhappy families, Russia and Ukraine each failed in its own way.

Post-Soviet Russia’s wrong turn came in the form of the Faustian bargain its first group of leaders—the Yeltsin team of economists known as the young reformers—was willing to strike in order to achieve their overriding priority: wrenching Russia from central planning to a market economy.

They accomplished a lot, laying the foundations for Russia’s economic rebound in the new millennium. But along the way they struck deals, most stunningly the vast handover of state assets to the oligarchs in exchange for their political support, which eventually transformed Russia into a kleptocracy and discredited the very idea of democracy with the Russian people.

Ukraine’s path to failure started with the 1991 compromise between democratic reformers and the Ukrainian Communist establishment. That tactical alliance proved to be both brilliant and doomed. Its value was immediate—Ukraine became, as long as Russia acquiesced, a sovereign state. The cost was revealed only gradually, but it was staggeringly high.

Like Russia’s Yeltsin, a former candidate-member of the Politburo, Ukraine’s new leadership was made up overwhelmingly of relics of the Soviet-era leadership: Leonid Kravchuk, Ukraine’s first president, had been the ideology secretary of the Communist Party in the Ukrainian Soviet Socialist Republic; his successor, Leonid Kuchma, had been the director of a mega-factory in Dnipropetrovsk that built the SS-18 missiles, the 10-warhead behemoth of the Soviet Strategic Rocket Forces.

Once the superpower they had thrived in disappeared, these men, and most of those around them, adopted Ukrainian patriotism, soon proving themselves to be enthusiastic, determined and wily advocates of Ukrainian independence. Their conversion was intensely opportunistic—it allowed them to preserve, and even enhance, their political power and offered the added perk of huge personal wealth.

But because many of the leaders of post-Soviet Ukraine had a genuine emotional connection to their country, they also took pride in building Ukrainian sovereignty, which put them at odds with some of their former colleagues in Russia, including, they would eventually discover, Vladimir Putin.

Unfortunately, their commitment to statehood was not matched by any coherent vision of economic reform, and they followed the usual post-Soviet project of enriching themselves and their comrades. The result, in addition to massive corruption, was gross mismanagement of the economy. Russia’s economic performance in the two decades following the collapse of communism was mixed at best; Ukraine’s was absolutely dire.

But when it came to democracy, the tables were reversed. Even though the pact between Ukrainian reformers and the Communist Party left the nomenklatura, as the Soviet leadership class was known, essentially intact, it turned out to be remarkably—and mercifully—inept at authoritarian governance.

The Ukrainian Communist Party and the KGB, with their formal ties to Moscow severed, were unprepared to act effectively on their own. Instead of closing ranks to rule the country, the power elites broke into competing clans associated with the major cities and regions. The result was a newborn country that was accidentally pluralistic, allowing democracy to spring up through the cracks in the regime’s control.

Proof of that came in 1994 when Kravchuk lost his reelection campaign. The very fact that he could be voted out of office was an early but important milestone for a fledgling democracy. It is one that Russia, with its more deeply rooted absolutist political system, has yet to reach.

That said, what followed was not exactly encouraging. Kravchuk’s successor, Leonid Kuchma, began to turn back the clock, harassing the opposition and the media. After serving the constitutionally maximum two five-year terms, Kuchma was able to rig the 2004 election in favor of his dauphin, Viktor Yanukovych, who was prime minister.

But Kuchma and Yanukovych overestimated their power to manipulate the electorate—and they underestimated civil society. In what became known as the Orange Revolution, Ukrainians camped out in the Maidan—the central square in Kiev—and demanded a new election. They got it.

Then came a truly tragic irony. Yanukovych’s opponent and polar opposite was Viktor Yushchenko, a highly respected economist and former head of the central bank. He was the champion of Ukrainian democracy. Largely for that reason, he was hated and feared by many in Russia, notably in Putin’s inner circle.

Yushchenko was poisoned on the eve of the ballot. The attempt on his life left him seriously ill and permanently scarred, yet he triumphed in the election. However, Yushchenko then did such a poor job in office that Yanukovych, who had failed to become president by cheating in 2004, ended up being elected fair and square in 2010.

Over the next four years of Yanukovych’s rule, the Ukrainian state became more corrupt and abusive of political rights than it had been even in the last years of Kuchma’s presidency. Nonetheless, the legacy of the 1991 compromise between the democrats and the apparatchiks lived on through the success of at least two of its main goals: peace and survival.

When, two years ago, Ukraine celebrated its 22nd anniversary as an independent state, the longest period in modern history, it had—for all its troubles—at least avoided violent separatism within its own borders, not to mention a war with Russia.

Then, in November of that year, came the first tremors of the cataclysm.

The Maidan and the return of history

According to Putin’s propaganda, the original fault line was within Ukraine, in the form of ethnic tension, and only later did the conflict take on a geopolitical dimension and disrupt relations with Russia.

A more objective and accurate version is that the unremitting and escalating crisis of the last year-and-a-half erupted in two stages: first, when Yanukovych reneged on a promised trade deal with Europe, part of a general turning away from the West, which set off a massive demonstration of people power; and then when, with Moscow’s support, he unleashed bloody force on the demonstrators.

But that drama has its own origin in 1991. Back then, the leaders and many of the people of Ukraine and Russia shared the dream of joining the political West, a choice that was about much more than geopolitics—it meant choosing the rule of law, democracy and individual rights over authoritarian kleptocracy.

Now Russia, at least as represented by the most powerful Kremlin leader since Stalin, has turned its back on that dream, while Ukraine’s leader, with the backing of most of his people, is determined to keep it alive.

Sitting on my uncle Bohdan’s couch in central Kiev, 10 days after Viktor Yanukovych’s flight from Ukraine, I began to grasp what was at stake. Bohdan is my mother’s brother, an agronomist who was born in and grew up in Canada, but moved to Kiev during the 1990s, around the same time my mother did. He married a bilingual Ukrainian and, after two decades living there, is comfortable in both Ukrainian and Russian.

When I arrived at Bohdan’s high-ceilinged, post-war apartment on March 4, 2014, he and his wife, Tanya, like so many Kievites, were glued to their television and its coverage of the political tumult that followed Yanukovych’s ouster.

The previous three-and-a-half months had been an emotional whipsaw. In the past two weeks alone, the citizens of the capital had suffered the bloodiest conflict on their streets since World War II. They had also watched their reviled president, Yanukovych, flee to Russia, a provisional government take charge, Russian troops assert control over part of their country and Putin insist on his right to take further military action.

Ukrainians were simultaneously celebrating their eviction of Yanukovych, mourning the victims of the slaughter on the Maidan, horrified by the invasion of Crimea and fearful of the possibility of a long, grinding war fanned and often directly waged by their giant neighbor to the north.

During my evenings on my uncle’s couch, I watched a number of extraordinarily dramatic events playing out on the TV screen, including many profiles in heroism. Some dramatized the complexity of the ethnic and linguistic issue that Putin was exploiting to his own cynical advantage.

In those first days of March, for example, Maksym Emelyanenko, captain of the corvette Ternopil in the Ukrainian navy, was ordered by the commander of the Russian Black Sea Fleet to hand over control of his vessel. Captain Emelyanenko answered: “Russians do not surrender!”

The surprised Russian vice-admiral asked the Ukrainian seaman what he meant. Captain Emelyanenko replied that, although he was ethnically Russian (his Ukrainian last name notwithstanding), he had given his oath of loyalty to the Ukrainian state and he would not betray it.

My aunt Tanya, who’d grown up in Ukraine, recalled that the slogan “Russians do not surrender” (“Russkiye ne sdayutsa”) was a famous battle cry of the Red Army during the Second World War, in which Ukraine bore the second most Soviet casualties in absolute numbers and suffered an even greater loss than Russia in proportional terms. She found Captain Emelyanenko’s valor to be both poignant and a stinging rebuke to the Kremlin leader who was now unleashing war on the Soviet fatherland’s own children.

My uncle and aunt, along with many Ukrainians, hoped that passive resistance would prevail as it had in the Maidan demonstrators’ stand-off with Yanukovych. But, as the covert occupation of Crimea, ordered by Putin and spearheaded by “little green men”—as the Russian soldiers without insignia who took over the peninsula were called—inched toward outright annexation, it quickly became apparent that peaceful tactics would not succeed against the near-term objectives of Putin.

That said, I could sense, even in those early days, that Putin’s use of overwhelming Russian force to crush Ukrainian resistance was backfiring against his ultimate goal, which was to bring Ukraine back under Russian sway.

The day after I arrived in Kiev I met Yegor Sobolev, a 37-year-old activist, over cappuccinos at a cafe on the Khreshchatyk, Kiev’s central boulevard. An ethnic Russian who was born and raised in Russia, Sobolev was one of a group of young, politically engaged Ukrainians who were the backbone of the Maidan movement starting back in November 2013.

He was a confidant of Mustafa Nayyem, a Muslim refugee from Afghanistan who was celebrated for launching the protests through a Facebook call to action. Sobolev and Nayyem are both former journalists who had tried to uncover the skullduggery and looting of the Yanukovych regime, and then had been motivated to political action by their revulsion at Yanukovych’s brutality. (Both men would be elected to Parliament several months later, as advocates of democratic and economic reform.)

“For many years, a big social problem was the passivity of people in the building of the nation,” Sobolev told me. “Yanukovych forced us, not just during the Maidan but before, to get angry and finally to fight, even with weapons. People have learned that the country is them.”

I heard similar sentiments wherever I went in Kiev that week. The capital was, almost literally, grievously wounded. The air was thick with smoke from bonfires, reeking with the stench of burning tires. The once-elegant Khreshchatyk was a grimy tent city, the avenue itself denuded of its cobblestones because protesters had pulled them up to throw at the armored special forces who were firing tear gas and live bullets at them.

A steady stream of Kievites, many of them stylish matrons in long fur coats and high-heeled leather boots, made their way to Institytska, the steep street leading up from the Maidan. Their mission was to lay bouquets on the two-story-high mountain of flowers in tribute to the victims of police and snipers, known as the Heavenly Hundred (it sounds less mawkish in Ukrainian).

But Kiev also felt invigorated and united. The city was experiencing the kind of we’re-all-in-this-together feeling familiar to anyone who lived through the London Blitz, or 9/11, or other times of national crisis and tragedy.

“Yanukovych freed Ukraine, and Putin is uniting it,” Sobolev told me. “Ukraine is functioning not through its government but through the self-organization of its people and their sense of human decency.”

I found myself harking back to 1991, when Ukrainian democrats I interviewed felt they had to choose between democracy and sovereignty. Now, in the wake of the Maidan and in the midst of the Russian land grab, Ukrainians had come to see that both are critical and that they are mutually reinforcing.

By early March of last year, as it became glaringly obvious that Ukraine was fighting not just for its political soul but for national survival, support for the agenda of the pro-Maidan provisional government and the sense of solidarity under pressure started to flow south and east—into the very regions that both Putin and simplistic international media coverage had characterized as pro-Russian.

A comprehensive poll done in April by the Kiev International Institute of Sociology, one of the country’s most respected polling firms, found, for instance, that in those regions of Ukraine 76.8 percent of respondents opposed the seizure of government buildings by separatist protesters; only 11.7 percent supported it. Nearly 70 percent were opposed to the unification of their region of Ukraine with Russia; only 15.4 percent were in favor.

An overwhelming 87.7 percent said that Ukraine should make its own decisions about internal affairs, such as constitutional structure and official language, without any involvement from outside powers, specifically Russia. (Interestingly, 71.5 percent said the rights of Russian language speakers were not under any threat in Ukraine.) It is worth underscoring that these strong views are the opinions of the lands Putin has claimed as “Novorossiya,” the largely Russian-speaking southern and eastern regions of Ukraine.

“People in Odessa, Mykolaev, Donetsk, and Dnipropetrovsk [all cities with large Russian-speaking populations] are coming out to defend their country,” Sobolev said. “They have never liked the western Ukrainian, Galician point of view. But they are showing themselves to be equally patriotic. They are defending their country from foreign aggression. Fantastical things are happening.”

Western Ukraine, known as Galicia, had long seen itself as the most nationally conscious region, the one that would lead a broader effort to knit the nation together and build a sovereign state. Culturally, historically, linguistically and even religiously, southern and eastern Ukraine were quite different, and did not always appreciate the Galician assumption that the western Ukrainian version of Ukraine was the best and truest one.

One of the paradoxical consequences of the Russian invasion was that southern and eastern Ukraine were proudly asserting their versions of Ukrainian identity as equally authentic and powerful.

Four days after I arrived in Kiev, Serhiy Zhadan, described by The New Yorker as Ukraine’s “best-known poet” and “most famous counter-culture writer,” was beaten by pro-Russian agitators at a Maidan demonstration. But that protest didn’t take place in Kiev’s Maidan. It happened 500 kilometers east in Kharkiv, the capital of eastern Ukraine where Zhadan, who was born in the Donbass, now lives and works.

His writing—think Irving Welsh’s Trainspotting set against a grim post-Soviet backdrop—is very popular in Russia, but he writes in Ukrainian, partly, he says, as a political act. When his attackers asked him to kneel and kiss the Russian flag, Zhadan recalled on his Facebook page—“I told them to go fuck themselves.” (Zhadan’s English-language translator happens to be another uncle of mine.)

Before I left Kiev in March, I took a final walk along the Khreshchatyk. Two hand-written signs, taped to the walls of buildings, stood out. “Russian people, we love you,” one said, in Russian. “Putin, Ukraine will be your grave,” another, written in Ukrainian, warned.

Blue and yellow versus the “little green men”

I saw the transformation Sobolev had told me about first-hand 10 weeks later, when I returned to Ukraine for the presidential election. I spent a day in Dnipropetrovsk, a city just 150 miles from the Russian border, whose citizens are largely Russian-speaking and whose industry was vital to the Soviet Union (to wit: those SS-18 missiles Kuchma built for a living). Leonid Brezhnev was born and educated there, and it remained his lifelong political powerbase.

But on election day, Dnipropetrovsk was wreathed in symbols of Ukrainian statehood. Apartment buildings were draped in blue and yellow, the colors of the national flag; every second car sported the same colors; many election officials wore shirts worked with traditional Ukrainian embroidery.

Dnipropetrovsk had resisted the little green men—the governor had offered a $10,000 bounty for any captured Russian soldier—and was scornful of the “Soviet” mentality of neighboring Donetsk, which was suffering from a so-called hybrid war (waged by Russian-backed locals armed with Russian equipment and artillery and supported by undercover Russian officers, advisers and soldiers who were, according to the Russian government, “volunteering while on holiday”).

This political shift provoked another twist of Ukraine’s linguistic kaleidoscope. Now that civil society’s common enemy was Yanukovych and the Kremlin political values he represented, speaking Ukrainian in public came to symbolize the fight for democracy, notably including in the east. For his part, Sobolev told me he had overcome his “psychological barrier” to speaking Ukrainian by reading For Whom the Bell Tolls in Ukrainian translation out loud to himself.

The threat and the promise of Ukrainian democracy

Ukrainians today are proud of the democratic episodes in their country’s history, and in Kiev you are likely to hear the country described as culturally inclined toward democracy. In late November, President Petro Poroshenko celebrated the formation of a new government following October parliamentary elections with a Tweet that made this point to his 237,700 followers: “The main difference between Ukraine and Russia isn’t only linguistic, it lies in our differing political cultures and attitudes to freedom and democracy.”

It is an entirely good thing that Ukraine’s new leaders are defining their national identity as inherently democratic and freedom-loving. But there have been times when Russia might have laid claim to such an identity, too.

To take just one example: on August 19, 1991, when Boris Yeltsin climbed on top of a tank in Moscow in front of the White House to defy a hardline coup and assert that “the democratic process in the country is acquiring an increasingly broad sweep and an irreversible character, the peoples of Russia are becoming masters of their destiny.”

A quarter century later, no one would make that assertion in Moscow. But it is the sort of thing said every day in Kiev. And that is why Putin is determined to subdue Ukraine. He doesn’t need Ukraine for economic gain—indeed, his aggression has come at a great, and mounting, economic cost.

He doesn’t need Ukraine for strategic reasons—Putin today is master of Crimea, but Russia is more isolated, less respected and surrounded by more suspicious neighbors than was the proud host of the Sochi Olympics just a year ago. He doesn’t even need the immediate popularity bump leaders always get at the beginning of a foreign war, especially one promised to be short and victorious.

What he does need is to show that a democratic, rule-of-law Ukraine can’t work.

As Mikhail Kasyanov, who served as Putin’s prime minister and once shared a sauna with his boss before joining the political opposition, told me in November: “We are similar people. As soon as Russians understand that Ukrainians can be free, why shouldn’t we be, too? That is why Mr. Putin hates what is happening so much, and doesn’t want Ukraine to escape his grip.”

Leonid Bershidsky, a distinguished Russian journalist who was so appalled by what happened in his country in 2014 that he left, thinks that for Putin, February 22, 2014 was the tipping point. That was the day the police melted away from Mezhyhirya, Yanukovych’s grotesquely palatial estate outside Kiev, and the public flooded in.

They discovered a lavish complex including grand, manicured parks, a zoo and a restaurant shaped like a pirate ship. Inside the main residence, a solid gold loaf of rye bread—a tribute to Yanukovych from a petitioner—was found. That absurd sculpture quickly became the symbol of Yanukovych’s criminal excess. (You can follow it on Twitter at the Russian-language parody account @zolotoybaton.)

That was the moment, Bershidsky believes, when Putin “submitted to paranoia” and decided it was essential to crush the new Ukraine. After all, he and his cronies have palaces, too.

Bershidsky is right. There were many bloodier and more dramatic episodes over the past year. But the opening of the gates of Mezhyhirya gets to the essence of what is at stake. The uprising in Ukraine and the fight between Ukraine and Russia is about many things—Ukraine’s consolidation as a nation, a wounded Russia’s rising nationalism, the uncertainty of a world in which the Cold War is over—but we haven’t quite figured out what will replace it.

At its heart, however, the conflicts within Ukraine, and the fight Putin has picked with Ukraine, are about post-Soviet kleptocracy, and where and whether there is a popular will to resist it.

Last September, I drove out to Mezhyhirya. It had become a much-visited public park. The grassy shoulders of the surrounding country roads were crowded with parked cars. A few couples were having their wedding pictures taken beside the ornate fountains. Two entrepreneurs were renting bicycles at the entrance to make it easier to tour the vast grounds. Others were doing a brisk business selling toilet paper and doormats with Yanukovych’s image on them. Even more popular were the ones depicting Putin.

Putin Tries to Freeze the Ukraine Conflict

From – http://www.bloombergview.com/articles/2015-05-15/putin-tries-to-freeze-the-ukraine-conflict

We hadn’t heard much from the separatists in eastern Ukraine lately, but this week they put forward proposals for the long-term status of those regions. These are mainly in line with the Minsk peace plan of February, but they are also designed to be rejected by the government of Ukraine as a way to produce a permanent frozen conflict zone, akin to the Russian-controlled areas of Georgia.

The separatists published their proposals on the website of the “Donetsk News Agency,” where they often post official statements. There is a document suggesting amendments to the Ukrainian constitution and another outlining a draft law on elections for the rebel-held areas. Both have Moscow’s fingerprints; they demonstrate a lawyerly cunning that the rough and ready rebels have never exhibited.

Judging from the two documents, President Vladimir Putin’s goal is for Ukraine’s leaders in Kiev to reject the proposals. Then he will be able to say Ukraine has broken its political terms and renounce his own key concession — to return control of Ukraine’s southeastern border to the central government by the end of the year.

At first glance, the separatist documents seem promising. In a sharp break with previous practice, they make no mention of the unrecognized Donetsk and Lugansk “people’s republics.” Instead, the territory is called “a separate district with a special status.”

Although the separatists had never acknowledged it before, the Minsk agreement specifies that their territory should remain part of Ukraine. It also requires judges and prosecutors to be appointed by Kiev. So if the rebels are to be the constructive party, they can’t say otherwise in their proposals.

The rebels do, however, claim their right (set down in the Minsk accord) to field a “people’s militia” with local commanders, allowing the current insurgent army to keep its weapons and, ultimately, control over the area.

The proposals also contain demands that simply weren’t covered in Minsk. These include locally controlled election commissions, fiscal control over local businesses that would allow the “special district” to balance its budget, an exemption from the article of the Ukrainian constitution that says the country’s regions are run by Kiev-appointed governors, and power-sharing between the central government and local councils.

In addition, there is a demand that Ukraine restore a law requiring the country’s military non-alignment, which was rescinded under President Petro Poroshenko. That would prevent Ukraine from applying for membership in the North Atlantic Treaty Organization.

None of these demands directly breach the letter of the cease-fire agreement.

The only proposal that does is a list of “special district” towns in the draft election law. It includes: Ukrainian-held Shyrokine, near the port city of Mariupol; Piski, adjacent to the hotly contested Donetsk airport; and Debaltseve, the railroad junction the rebels seized after the Minsk deal was signed. The cease-fire explicitly enshrines last September’s separation line between the rebels and the Ukrainian military, and would put all three towns on the Ukrainian side.

The separatists have submitted their proposals both to the Ukrainian Constitutional Commission, charged with working out a decentralization plan, and to the Minsk contact group, which is supposed to monitor cease-fire compliance. Ostensibly, the rebels — and Russia — want a dialogue with Ukrainian authorities about the documents. They know, however, that it won’t take place. “We don’t really want to respond to this clear provocation by the separatists,” a person at the Constitutional Commission told Theinsider.ua.

Putin undoubtedly wants the commission to reject the proposals. That’s why the separatists also submitted them to the international contact group, where French diplomat Pierre Morel oversees the political part of the Minsk deal. It’s important for Putin to convince his Western adversaries that Ukraine won’t do its part to bring about lasting peace.

That’s the reason Putin’s propaganda machine seized on Poroshenko’s recent statement that Ukraine would “free” the Donetsk airport, part of which is in rebel-held territory, according to the cease-fire terms.

Putin wants Western leaders to get tired of Poroshenko’s combative stance. As soon as they show signs of such fatigue, he can freeze the situation and proceed to build ties with the rebel-held areas on the model of other frozen conflict zones: Transnistria in Moldova, Abkhazia and South Ossetia in Georgia.

It’s hard for Ukraine to break out of this Kremlin scenario. The last thing it wants is to negotiate its new constitution with Putin and his proxies. A refusal to negotiate, however, isn’t going to please German Chancellor Angela Merkel or her French counterpart, President Francois Hollande, who brokered the Minsk deal. Merkel has reportedly told Poroshenko that Putin is prepared to recognize east Ukraine’s “people’s republics” and send in a “peacekeeping force,” as he did with the disputed areas of Georgia. If she did say that, she was probably trying to compel Poroshenko to be more flexible and keep the Minsk deal alive, so Putin would be forced to hand back control of the border by the end of the year.

Such flexibility, however, would be politically impossible for Poroshenko. He doesn’t have a popular mandate to create a pro-Russian autonomous area within Ukraine. His response is to try to scare his Western partners with a new Russian onslaught — but they will only believe it when they see it.

Imposing Costs on Putin Will Deter War

From – http://www.atlanticcouncil.org/blogs/new-atlanticist/imposing-costs-on-putin-will-deter-war

“Russia and America: Stumbling to War,” a recent National Interest article by Graham Allison and Dimitri Simes, commands attention because of the gravity of the issue and the stature of its authors. Allison is a leading authority on great power relations, and Dimitri Simes is a scholar with deep connections to the elites running Russia.

The main thrust of the article appears to be a strong note of caution to Western, especially American, policymakers. Russia is a great power that fell on hard times during which, its elite believe, the West took advantage of and disrespected it. This explains why Russia is lashing out in Ukraine now. The authors warn the West against pushing Moscow into a corner because we cannot be sure how the Kremlin might react. They take seriously Moscow’s frequent references to its nuclear power as an instrument to protect its interests and influence Western policy.

The Urge for Caution
The article provides a wealth of historical examples of nations stumbling into wars they did not want because of assertive policies. The authors reference World War I, where, in their view, the British should have understood Austrian anxieties about the Serbs and World War II, where the US should have understood that an embargo on Japan would lead to war. The authors also cite more examples of blundering American policy—from Afghanistan and Iraq to Libya—as evidence of policymakers not understanding the consequences of their actions.

But the historical record is not always on their side. To cite a crucial example, French and British weakness in the face of Hitler’s multiple aggressions led to war when Germany was strong.

The Official Russian View of Things: Putin’s Position Is Firm and the Potential Replacements Worse

Allison and Simes’ analysis suffers from a number of flaws. First, their argument is based not just on their admittedly extensive and impressive professional experience, but also recent discussions with senior Russian officials and the Moscow elite. Given the sources, much of what they have to say about the crisis reflects the narrow set of views that are acceptable in Russian President Vladimir Putin’s increasingly authoritarian Russia. The authors do not offer other sources for interpreting Kremlin behavior, nor do they provide their own analysis. So we should understand that the value of this article is bringing to Western readers the views of Kremlin-approved elites.

The views may be accurate, but they were designed to help persuade the West to avoid policies that would interfere with Kremlin designs in Ukraine and elsewhere in Europe and Eurasia.

Their argument rests on three assertions popular in Moscow’s official precincts. First, Putin is in control in Russia and the only alternative to him are “hardliners.” Second, the Russian people overwhelmingly support Putin and economic sanctions will not deter Putin or weaken his support at home. And finally, providing arms to Ukraine is risky because it might provoke a harsh, unpredictable Kremlin reaction.

An Alternate View: Putin’s Precarious Domestic Position
If Allison and Simes talked with a wider circle of Russians and looked closely at events in Russia, they might come to the conclusion that significant parts of the Moscow elite— oligarchs and technocrats at least—are concerned about Russia’s isolation and the impact of Western sanctions. These groups understand that, in tandem with low prices for hydrocarbons, the sanctions are damaging the Russian economy and limiting their own possibilities. Yes, the authors are right that the siloviki in Moscow—in the Federal Security Service (FSB) and the military—and the Chechen forces under Ramzan Kadyrov are the most powerful players in Moscow at the moment. But the rising pressure on Russia is bringing to the fore breaks in their unity.

These fissures were evident in the peculiar events surrounding the murder of opposition activist Boris Nemtsov in February. While Putin disappeared for 12 days in March, the FSB accused the Chechens of the murder. When Putin reappeared, he gave an award to Kadyrov and appeared with Kremlin Chief of Staff Sergei Ivanov, who is close to the FSB. In the opaque society of the siloviki, we cannot know with certainty what these developments mean, but it is clear that there is something less than unity at the top. And policy failures can provide opportunities for ambitious men to maneuver against their leaders and rivals.

The fact that the men around Putin at the moment favor hardline policies does not tell us what policies they would advocate if Putin were vulnerable. In the pursuit of power they would adopt the policies that they believe would advance their aims. It is worth recalling that after Stalin’s death, one of the most odious of his henchmen, Lavrentiya Beria, was pushing for an ease in relations with the West.

Indeed, the authors’ wide use of history also ignored the many occasions when Russian defeats abroad led to liberalization (after the Crimean War), revolution and reform (after the Russo-Japanese War), revolution (after World War One) and liberal transformation (after the Cold War).

And we should make no mistake about it, in Russia, Putin’s grand Donbas adventure does not look like a winner. There was no rising of the indigenous population against Kyiv. After the easy gains in the spring of 2014, the Ukrainian military launched a successful counteroffensive that took Russian troops to stop. Russian gains since then have been slow and incremental and cost numerous casualties, including to Spetznats units, at Donetsk Airport and Debaltseve.

Contrary to the authors, the growing number of Russian causalities will likely have an impact over time on Putin’s support at home. Putin’s popularity was forged by economic prosperity that was the result of sound fiscal policies and rising hydrocarbon prices. Years of low or no growth will likely reduce his support. The polls that show overwhelming Russian support for the annexation of Crimea were based on questions that claimed that there was no cost to Russia for the annexation.

Putin also understands that his people do not want Russian soldiers fighting in Ukraine—a fact that Levada Center polls capture. And the Russian public opposes Russian troops fighting in Ukraine even though the Russian media continues to confuse the narrative; it has reported that American soldiers are fighting in Ukraine. Given popular opposition, Putin is doing everything possible to conceal from the public the fact that Russian soldiers are dying in Ukraine.

Putin’s Aims
Allison and Simes shy away from describing Putin’s objectives. They discuss at some length the Russian elite’s anger at the indignities allegedly foisted upon them since the end of the Cold War. These indignities include the expansion of NATO eastward and Obama’s referring to Kremlin policies and actions as a scourge on par with the Islamic State of Iraq and al-Sham and Ebola. But nowhere do the authors venture what Putin might be after with his aggression in Ukraine. Despite numerous efforts by various Western interlocutors eager to help Putin find an off-ramp for this crisis, the Kremlin has yet to lay out its requirements for peace. This is a standard negotiating tactic to prompt your opponents to fall over themselves in offering concessions. It is not the path to peace.

Numerous statements by Putin, senior Kremlin officials, and Russian actions however provide a sound basis for assessing Putin’s objectives. The Russian President has called for a Russian sphere of influence in the former Soviet Union and Empire; new rules for the post-Cold War order “or there will be no rules”; and a right and duty to protect ethnic Russians and Russian-speakers wherever they happen to live.

Consistent with these statements, he has launched wars to change borders in Georgia and Ukraine in an effort to upend the post-Cold War order in Europe. Indeed, under Putin’s guidance, a major power is seeking to change borders in Europe by force of arms for the first time since Hitler.

Putin has shown no interest in annexing the Donbas, where Moscow has led, financed, armed and provided recruits for a hybrid war; he has also sent in regular Russian troops in September 2014 and again in January 2015 to lead offensives against Ukrainian forces. If he cannot engineer a compliant regime in Kyiv, Putin’s objective is to destabilize the current one.

Putin has demonstrated that his ambitions go beyond Ukraine. While his regular soldiers were fighting in Ukraine in August 2014, he sent a barbed message to Kazakhstan saying that it was an artificial country that under President Nursultan Nazarbayev treated its Russians well, but that good treatment may end when the 74-year old leader passes. In September 2014, the Russians kidnapped an Estonian counterintelligence officer from Tallinn and seized a Lithuanian ship in international waters of the Baltic Sea. We do not know what Putin will do next. We do know that he had surprised us with his audacity in seizing Crimea and then launching the war in Ukraine’s east.

One Cheer for the Authors
In spite of pushing hard for caution and taking at face value Kremlin-approved talking points, the authors note that the West must define and defend its interests with clear red lines. This is sensible advice, especially in the face of Putin’s revanchist aims and aggressive policies.

But before the West sets those red lines and enforces them, we need to understand likely Kremlin objectives, as well as its strengths and vulnerabilities. We must prepare for the likelihood that Putin’s revanchism does not end in Ukraine. Just as the West’s weak response to Kremlin aggression in Georgia and Crimea emboldened Putin in the Donbas, Western weakness in the current crisis could lead to further Kremlin provocations in the neighborhood, including the Baltic states.

This means that we need a resolute policy in Ukraine. Western sanctions must stay in place until all Russian forces and equipment return to Russia, and Ukraine controls the border in the east. Additional Kremlin aggression in Russia—to take Mariupol or more likely less fortified locations in the Donetsk or Luhansk regions—should prompt further sanctions.

The United States should provide substantial military aid, including defensive lethal equipment, to exact a higher cost on further Russian aggression. Such aid should have strict conditions about offensive use. The purpose is to help Ukraine stabilize the current ceasefire line. The Kremlin undoubtedly has the means to overwhelm the aid we provide, but they would still suffer more casualties, which is a political liability for Putin. The more casualties the Kremlin suffers, the more equipment it loses, and the more money it must spend for aggression in Ukraine, the less it will have for aggression elsewhere.

Finally, NATO should not just reiterate its Article 5 commitment to its members. It should deploy to the Baltic states a battalion of American soldiers. And they should be properly equipped with tanks, artillery, and missiles. NATO should also prepare a contingency plan for defeating a hybrid war in the Baltics, and the efforts should include military exercises. Now is the time to review and amend the NATO-Russia Founding Act, which was based on the idea that the Kremlin was a partner. But partners do not establish their bona fides by invading and provoking their neighbors. The US and NATO can take strong measures with Russia, announce their desire to reestablish a productive partnership with Russia, and spell out the changes in behavior that will make partnership possible.

Four Reasons to Be Hopeful About Ukraine’s Economy

From – http://www.atlanticcouncil.org/blogs/new-atlanticist/four-reasons-to-be-hopeful-about-ukraine-s-economy#.VVVi8UFpUBk.facebook

Ukraine’s current economic crisis was years in the making. Former President Viktor Yanukovych grossly mismanaged and looted the country. And it may take years for the country to fully recover. But there are signs that the economy has reached the lowest point and its prospects are brighter than commonly portrayed in the press.

First, the International Monetary Fund’s (IMF) massive, front-loaded aid package gave much-needed breathing space to the Ukrainian government. The IMF deal gave the government resources to cover the deficit and foreign reserves to defend the hryvnia. Most visibly, the hryvnia appreciated by a third relative to the levels it reached in the heat of the panic in February 2015.

Second, the country’s fiscal position has tangibly improved. While Naftogaz, the state-owned gas monopoly, continues to be a black hole in public finances, the central and local governments had a fiscal surplus in the first quarter of 2015. The government also tripled the price of gas, putting it closer to market levels, thus closing a source of major fiscal problems. Consumers did not complain about the spike in gas prices as much as many had expected. The public perceived that the previous subsidy was not sustainable, and it was widely understood that everyone has to make sacrifices during wartime. In addition, the government provided a transparent and targeted subsidy to the least-protected households, which lessened criticism.

Third, inflation spiked in recent months reaching 60 percent at the estimated rate of annual return. While high, the spike is mostly due to the depreciation of hryvnia in 2014-2015 and a large increase in gas tariffs. Furthermore, a careful analysis suggests that actual inflation may be lower because of biases in the way inflation is calculated by the government. In any case, the National Bank of Ukraine (NBU) has implemented a tight monetary policy and projects inflation to subside by the end of the year. Valeriya Gontareva, the head of the NBU, has reiterated the central bank’s commitment to achieving stable and low inflation.

Fourth, the pace of reforms has accelerated in 2015. The government passed and implemented a number of crucial laws to change the institutional environment of the economy. It opened the energy market to more competition, enhanced protection for minority shareholders, cut red tape and regulation, and increased access to public records. Index for Monitoring Reforms, a survey-based index that tracks regulatory changes and is calculated bimonthly based on an expert survey, suggests that the government is serious about reform (see Figure 1).

Figure 1. Speed of reforms

The government and the IMF expect Ukraine’s economy to recover in the second half of 2015. Obviously, such a forecast is subject to many caveats and risks—most importantly, the recovery depends on reduced tension in the Donbas. There are others signs that things may be turning around: the deeply depreciated hryvnia makes Ukrainian goods competitive; the current account deficit—that is, how much imports exceed exports—fell from $630 million in March 2014 to $13 million in March 2015. The initial shock from increased energy prices and economic collapse in eastern Ukraine is wearing out. And government spending on the military has had a stimulatory effect on the economy.

But significant challenges lie ahead. Restructuring the government’s sovereign debt won’t be easy. The IMF package requires the government to reach a deal with its creditors so that the country can reduce its outstanding debt, increase its maturity, and reduce the interest rate. Ukraine doesn’t have much time; the deadline is the end of May. So far the government is not satisfied with the negotiations with its creditors. In 2014 and early 2015, the Ukrainian government could not credibly threaten to default because it did not have the resources to cover a fiscal deficit, but now with a fiscal surplus, the government’s position is considerably stronger. Indeed, the market perceives that some restructuring is imminent: Figure 2 shows that the private market assigns a 20 percent probability of default on Ukraine’s public debt. One may interpret this probability as suggesting that creditors are expected to lose 20 percent in the process of writing down debt. This haircut is in line with the rates observed in previous cases of sovereign debt defaults. Negotiations may be thorny, but the likelihood of a deal is high. State-owned companies have already started to default and restructure their debts thus paving the way for a larger restructuring.

Figure 2. Probability of default implied by credit default spreads on Ukraine’s public debt.

In summary, an economic recovery in Ukraine may be just around the corner. Of course, there is a great deal of uncertainty and the war in the Donbas weighs heavily on the future of the country and its finances. But some economic growth in Ukraine is entirely possible this year.

Mistral: France Offers To Refund € 784,6 Million While Russia Wants € 1,163 Billion

From – http://nomistralsforputin.com/drupal/?q=RealPrice

Lately, rumours about the Mistral spread as the speed of light without considering facts and verified numbers. Let’s get a few things straight:

1) France offers France offers to refund € 784,6 million while Russia wants € 1,163 Bln to terminate the contract.

2) Price of maintenance of the Mistral is not € 5 millions per month but € 0,4 million/month.

3) No, the Mistral war ships will not be sunk in the open sea as it is forbidden by the French law.

How Much The Non Delivery Of The Mistral Will Cost To France?
In the last days, an article from the french newspaper Le Point was stating that the cost for the non delivery could be “between 2 to 5 billion euros”. All russian newspapers of course jumped on this and spread this rumour. As a matter of fact, the real numbers negotiated right now are as follow:

France offers to refund € 784,6 million while Russia wants € 1,163 Bln

We knew that Paris and Moscow were negotiating at the moment but we were not sure of the real numbers. The russian newspaper Komersant provided the real and precise numbers. Once more, we are far from the 5 billion euros. The french Front National party, a few month ago was even talking about up to 10 billion euros to pay in case of non delivery.

Details of the calculation of these numbers seem to be that the Kremlin would like to include the price of the development of the Ka-52K helicopters in it (**). These helicopter were developed by the Russian federation especially to be used on the Mistral but can also be used without it. It has already been said that they will be used anyway.

Both sides have until the 25th of May to reach an agreement.

How Much Does The Maintenance Of The Mistral Costs Per Month?
All newspaper lately (especially russian but not limited to) are stating as a fact that the upkeep and maintenance cost for the Mistral war ships is 5 million euros per month.

The real cost of maintenance unveiled by the newspaper Le Marin in April 2014 is 400 000 euros per month.

Besides, this amount is paid by STX and will be included in the final cost of the Mistral when sold. French taxpayers are NOT paying for this every month.

Will The Mistrals Be Sunk In The Open Sea?
No, the Mistral war ships will not be sunk in the open sea as it is forbidden by the French law. Nothing else to argue about. An article from the french paper Le figaro was talking about this as a possible option. All russian media and some ukrainian media jumped on this as if it was a fact wihtout checking if it was only possible

Journalists, check your facts and don’t spread rumours!

John Kerry’s Sochi Misadventure

From – http://www.the-american-interest.com/2015/05/14/john-kerrys-sochi-misadventure/

The Secretary of State’s trip to Russia won’t solve any problems, and it makes the Obama administration look weak and desperate.

On Monday, the day before John Kerry’s arrival in Sochi to meet with Russian President Vladimir Putin, the Russian Foreign Ministry issued a statement blasting the United States. “Russian-US relations are passing through a difficult period caused by targeted unfriendly actions by Washington,” the statement said. “The White House groundlessly blamed Russia for the Ukrainian crisis, which in fact was largely provoked by the United States itself. In 2014, the Obama administration chose the path of scaling back bilateral relations, proclaimed a course of isolating Russia on the international arena and demanded that those states that traditionally follow the lead of Washington support its confrontational steps.” Welcome to Russia, Mr. Secretary!

Officially, Kerry went to Sochi to discuss cooperation with Russia on various regional issues, such as Syria, Iran, and Ukraine. But the decision to travel to Russia flies in the face of the isolation of Russia his boss bragged about back in January.

In his State of the Union speech this past January, President Obama took credit for leading the campaign to punish Russia for its invasion of Ukraine. “…[I]t is America that stands strong and united with our allies, while Russia is isolated with its economy in tatters. That’s how America leads—not with bluster, but with persistent, steady resolve.”

Putin has done nothing to merit a visit by the U.S. Secretary of State. As recently as Saturday, during the military parade marking the 70th anniversary of the end of World War II in Europe, Putin slammed the U.S. for “attempts to establish a unipolar world. We see the strong-arm bloc thinking, gaining momentum. All that undermines sustainable global development.” And that is mild compared to most of Putin’s attacks against the U.S.

Worse, Putin has continued supporting forces fighting in eastern Ukraine in violation of a ceasefire agreement struck in February and has built up Russian forces along the border with Ukraine in preparation for a possible full-scale invasion.

Russia continues to support Bashar al-Assad’s slaughter of the Syrian people through arms deliveries and diplomatic backing, so cooperation on Syria seems unlikely. Same on Iran, since Putin announced a month ago that Russia would deliver S-300 missiles, a sale which former President Dmitri Medvedev had suspended in 2010, and which would significantly boost Iran’s defensive capabilities against a possible military attack. Rather than condemn Putin’s S-300 announcement, Obama expressed “surprise” that Russia had held off on the delivery of such systems for so long, a view echoed by Kerry in Sochi.
Internally, Putin continues the worst crackdown on human rights in Russia in decades. His demonization of Russian opposition figures created an environment in which the tragic murder of Boris Nemtsov on February 27, gunned down meters from the Kremlin, is not a surprise.

Putin and his Foreign Minister, Sergei Lavrov, have offered no solutions for the Ukraine crisis and demand that the West, not Russia, change its policies and lift sanctions. They have wooed certain European leaders, especially from Greece, Hungary, Cyprus, and the Czech Republic, in the hope that they will not go along with extending sanctions on Russia at the European Union’s next leaders summit in June.

Kerry’s visit follows by a few days a visit to Moscow by German Chancellor Angela Merkel, who paid her respects for the tremendous losses inflicted on the Soviet Union by Nazi Germany 70 years ago. In a press conference following a two-hour meeting with Putin, Merkel spoke in blunt terms. “We have sought more and more cooperation in recent years,” she said of Russia and Germany. “The criminal and illegal annexation of Crimea and the warfare in eastern Ukraine has led to a serious setback for this cooperation.”

“I would like also to recall that the end of World War II did not bring democracy and freedom for all in Europe,” Merkel added regarding the Soviet sphere of influence established over large parts of Eastern and Central Europe, including her native East Germany.

Kerry, by contrast, offered platitudes, saying he was “privileged to spend many hours” with Putin and Lavrov (most people would find such an experience excruciating). His trip to Sochi makes the Obama administration look weak and desperate and will likely trigger a stream of Western visitors to seek a meeting with Putin, completely ending the isolation of Russia. If Russian officials are serious about solving the Ukraine crisis (and that would require fully withdrawing from Ukraine and respecting its sovereignty and territorial integrity), let them come to us. They know what they need to do—they simply refuse to do it.

Instead of contracting out to Merkel responsibility for solving the Russia-Ukraine crisis and meeting with Putin, the White House should lead the effort in providing massive financial assistance to Ukraine and the military means for Ukraine to defend itself, while ramping up sanctions on Putin’s regime. Rather than Sochi, Kerry should be going to Prague, Athens, and other European capitals to ensure EU sanctions are maintained. The Obama administration has confused tactics (maintaining unity with the EU) with objectives (getting Russia out of Ukraine and helping Ukraine succeed). Obama seems to have lost interest in Ukraine and Europe more broadly, and Putin senses that. John Kerry’s visit to Sochi isn’t going to fix that problem. It may even create new ones.

New Putin Invasion Coming This Summer

From – http://www.thedailybeast.com/articles/2015/05/17/new-putin-invasion-coming-this-summer.html

Moscow says it’s sticking to a ceasefire agreement. Meanwhile, it’s piling up troops and weapons for something that doesn’t look so peaceful.

The war in Ukraine may have faded largely from international headlines, but Vladimir Putin’s drip-drip invasion continues. In the last two weeks, forensic evidence, some of which has been reported by monitor organizations and senior Western diplomats, the rest corroborated by eyewitness photography and video, only confirm what the U.S. fears most: a summer offensive is inevitable.

On May 5, the Ukrainian government released new data which says that they have lost 28 towns to Russian-backed separatists since February 18. That was the day the strategic town of Debaltsevo, which guarded a key highway to separatist-controlled regions, slipped from Ukraine’s control. The map of separatist territory is as alarming as it is illustrative, especially when it is combined with the daily reports of ceasefire violations and fighting coming out of both the Organization for Security and Co-operation in Europe (OSCE) and Kiev.

On May 6, Ukrainian President Petro Poroshenko addressed the National Security and Defense Council and warned that Russia has 50,000 troops on the border and its proxies have more than 40,000 fighters inside the country. That’s not only a combined 50% increase in possible invaders over July of last year, the month which proceeded the “Russian invasion” on the Ukrainian mainland. It’s more than enough soldiers to invade and gobble up a significant amount of Ukrainian territory.

“There is a convincing evidence that Ukraine strictly complies with the Minsk [ceasefire] agreements and militants constantly violate them,” Poroshenko noted. Separatists do not allow international observers to verify their withdrawal of heavy weaponry. “Militants regularly shoot Ukrainian positions, engage in reconnaissance and subversive activity and provoke armed confrontations in order to disrupt peaceful settlement of the conflict.”

One day later, May 7, the OSCE witnessed a significant amount of fighting both near Donetsk and around a town called Shirokino, 20 kilometers east of Mariupol—part of a trend of heavier fighting which started in late April. The OSCE also reported that one of their surveillance drones was jammed for ten minutes while attempting to monitor the movement of separatist tanks near Donetsk, in violation of the 50 kilometer demarcation line agreed upon by both sides.

While the OSCE reports that it has seen an increase of heavy weaponry within the demarcation line for weeks, Ukraine maintains that it is only returning fire and it is the Russian-backed separatists who are on the offensive. On May 8, the day after OSCE’s unmanned aerial vehicle (UAV) was jammed, the OSCE witnessed three Ukrainian tanks in government-controlled territory—an admitted violation of the negotiated ceasefire. That same day the OSCE witnessed 30 separatist tanks moving toward the front lines within the demarcation line—ten times more than the Ukrainian government was deploying. The OSCE also observed a testing-ground for advanced weaponry—proof, according to the U.S. ambassador to Ukraine, Geoffrey Pyatt, of “Russia’s train and equip program in plain sight.”

Each day since has provided more evidence that the Minsk agreement is little more than a piece of paper. For weeks the OSCE, NATO, and citizens of eastern Ukraine brave enough to snap pictures and video have been warning that a large amount of heavy Russian armor and artillery has been headed back to the front lines. The separatist leadership has maintained that this equipment was only moving around to prepare for military parades on Saturday, May 9, to commemorate the 70th anniversary of Nazi Germany’s capitulation to the Soviet Union in World War II. While the movement of this equipment would be a violation of the Minsk agreement whatever the floated reason, since the parades ended the weaponry hasn’t been moved back beyond the demarcation line.

It’s not just the amount of firepower now in separatists’ hands that is alarming observers. It’s also the kind of weaponry—specifically, the Strela 10 anti-aircraft missile system.

The Strela-10 is designed to supply close support to troops and vehicles near the front line of fighting. It’s meant to shoot down fast-moving, low-flying aircraft such as helicopters or non-stealth jets. There is significant evidence that the Russian military regularly includes the Strela-10 in important convoys because it can protect against immediate air threats while longer-range weapons (such as the Buk system, which shot down MH17 passenger jet in 2014) can perform the same function from further afield. In fact, the first time the Russian-backed fighters were ever seen using T-72 tanks, Strela-10s were filmed escorting the vehicles from a border crossing in Lugansk just seven days before MH17 was immolated. There are no documented cases of the Strela-10 system having been captured by Russian-backed separatists, and the T-72 has not been used by the Ukrainian military in this conflict.

On May 2, three Strela 10s were spotted escorting a convoy of two T-64B tanks, three BMP-2s, three BTR-80s, three 2S1 Gvozdika self-propelled howitzers, three BM-21 Grad MLRS, three trucks towing artillery pieces, perhaps 2A65 152mm howitzers, and several other military trucks and fuel tankers through Lugansk. On May 5 Strelas were seen parading through Donetsk, escorting a similar convoy. But if they were only in Donetsk for the May 9 parade, it’s curious that a similar convoy was spotted by the OSCE within the line of demarcation near Donetsk on May 10, suggesting that the weapons have not returned to their holding areas as specified in the Minsk protocol.

Could these weapons systems have been mobilized just to deter Ukraine and fortify standing separatist positions? Well, Minsk was designed to forestall any such scenario and explicitly called for de-escalation rather than retrenchment. Also, Western military officials seem to think the presence of this materiel has another purpose altogether. In late April, NATO Supreme Commander and US Air Force General Philip Breedlove warned that the Russian military had taken advantage of the ceasefire to train and equip the separatists and to “reset and reposition” their forces. Nor were these mere training exercises. “Many of their [the Russians’] actions are consistent with preparations for another offensive,” Breedlove said, adding that Russia never rattles its saber without the attendant follow-through. Breedlove also suggested that Russia had further integrated its own military’s “[c]ommand-and-control, air defense, support to artillery…making a more coherent, organized force out of the separatists.” Then, on May 11, NATO Secretary General Jens Stoltenberg also warned that the separatists are now so well equipped that they could launch an all-out offensive against the Ukrainian military on little notice and without direct military assistance. Again, if all this was just to hold the line, then why agree to Minsk in the first place, when that protocol was designed to do just that without the benefit of tanks or APCs?

There’s the added alarm of what the separatist leadership itself says about its imminent plans. On April 23, Vice News broadcast an interview with Alexander Zakharchenko, the self-declared head of the “Donetsk People’s Republic.” Asked if he saw the Minsk agreement holding, Zakharchenko was unambiguous: he did not want it to hold.

He categorically rejected one of the main planks of that diplomatic settlement—that the Donbass remain part of Ukrainian territory. “Do you suggest we give up, so our territory can fall into Ukraine’s hands?” he told Vice News. “So that they can put us back into the stalls, like we are some kind of cattle? So that they can drag us to join the E.U., to be living off American handouts? We do not want that. We declared that we want to be friends with Russia and that’s what we are doing. That’s what the majority of the local population want. At least 95 percent.”

Zakharchenko, who wants to see the return of the Soviet Union, mooted the possibility of other conducting “referenda” to certify their breakaway status from Ukraine.

“Aside from Zakharchenko’s belligerent rhetoric,” a senior Western diplomat told The Daily Beast, “the most worrisome evidence is the continued active tempo of Russian training activities with the separatist armies, and the presence of advanced Russian surface-to-air missile systems near the contact line in blatant violation of the Minsk agreement.”

As ever, the Putinists command one side to abide by a compact they never had any intention of honoring themselves. Only now, they’ve managed to embarrassingly snare the State Department into defending their own arguing position. While John Kerry was breaking bread (and potatoes) with Putin and Russian Foreign Minister Sergei Lavrov at the Russian president’s personal residence in Sochi this week, Poroshenko made an ambiguous statement about plans to regain Donetsk International Airport, once the cynosure for some of the fiercest fighting the war as yet seen and some of the bravest Ukrainian resistance to better-armed separatists.

“I have no doubt,” Poroshenko said at the premier of “Airport,” a new documentary about the battle for that installation, “we will free the airport, because it is our land. And we will rebuild the airport.”

Kerry was in Russia on his first state visit since 2013, and clearly there to ask for various favors from a government the United States has sanctioned yet nevertheless believes it still needs to resolves various foreign crises from Syria to Iran and Ukraine. So the opportunity to scandalize America’s top diplomat—something of a contact sport in Russia these days—was too good for the Kremlin-owned press to pass up. Asked by the state-owned media about Poroshenko’s provocative although nebulous pledge, Kerry replied as the media hoped he might by saying that he hadn’t seen the Ukrainian president’s remarks but would warn him to “think twice” before kickstarting any military operation.

The U.S. embassy in Moscow tried to downplay the inevitable awkwardness this created between two allies, noting, for instance, that Poroshenko has elsewhere ruled out taking back any of the Donbass by force. But Moscow just sat back and enjoyed the squirming. Vitaly Churkin, Russia’s ambassador to the U.N. said, “It’s an important thing that Kerry made this statement and that he said the U.S. believed it was crucial to observe the accords reached in Minsk on February 12,” neglecting of course to mention how his own government has “observed” those accords.

The Ukrainians, meanwhile, were left furious at Kerry for kowtowing to the Kremlin (again) and now worry that the Obama administration has gone out of its way to telegraph its own disposition should fighting indeed escalate in the coming weeks. Kerry went so far as depict the Ukraine crisis as the result of bilateral culpability: “whoever has instigated” war, he said, should stop, as it has gone on too long already. He also floated the possibility of U.S. sanctions relief on Russia “if and when Minsk is fully implemented.” Washington, it is feared in Kiev, will do nothing if Minsk is turned to toilet paper. And that’s as good as an engraved invitation for Putin to proceed as he’d already planned to anyway.

U.S. House overrides Obama’s veto, passes defense policy bill with lethal aid for Ukraine

From – http://www.unian.info/politics/1078587-us-house-overrides-obamas-veto-passes-defense-policy-bill-with-lethal-aid-for-ukraine.html

The U.S. House of Representatives defied a veto threat from President Barack Obama on Friday and approved a $612 billion defense policy bill.

The vote was 269 to 151 for the legislation, a blueprint for next year’s spending on military and other national security programs, the Associated Press reported.

The bill calls, among other things, for arming Ukrainian forces fighting Russian-backed separatists, a move the Obama administration has so far resisted.

Overall, the House bill authorizes $515 billion for national defense and another $89.2 billion for the emergency war-fighting fund for a total of $604.2 billion. Another $7.7 billion is mandatory defense spending that doesn’t get authorized by Congress.

The Senate version follows the same approach as the House to funding the military. The Senate Armed Services Committee voted 22-4 on Thursday to authorize $523 billion in base funding for the Defense Department and other national security programs and an additional $90.2 billion for the emergency war-fighting fund.

Putin and Ukraine’s east/west divide

From – http://www.brookings.edu/blogs/order-from-chaos/posts/2015/05/14-putin-russia-divide-pifer

In the latest Brookings essay, Chrystia Freeland relates a personal narrative of Ukraine’s past 25 years and of how Russian President Vladimir Putin has plunged Ukraine-Russia relations to their current toxic state. It makes for a very interesting read.

One issue that Freeland’s essay highlights is how the Russian regime has tried to twist the issue of ethnic and regional divides for its own purposes. This type of effort to manipulate identity has echoes in numerous conflicts around the world—from the Balkans to Syria and Yemen and beyond.

In the Ukrainian case, Freeland writes about the division between “the mainly Russian-speaking majority of Ukrainians in the eastern and southern regions of the country, and the mainly Ukrainian-speaking majority in the west and center.” Putin may have thought he could exploit that divide. But the Russian president’s actions appear to be closing it in that part of Ukraine not occupied by separatist/Russian forces—well over 90 percent of the country.

When I prepared in 1997 for my assignment as ambassador to Ukraine, I read a lot about the east/west divide. A few years earlier, a U.S. National Intelligence Estimate had questioned whether Ukraine might not break up along that line.

As Freeland rightly notes, the division is often over-simplified. It is not so much an ethnic divide. Ukraine’s population is only 17 percent ethnic Russian. Curiously, Putin always mangled this fact, claiming that 17 million Ukrainians were ethnic Russians, which would equate to 37 percent of the population. He is no fool; the mangle was intentional.

While most ethnic Russians live in the eastern part of the country or Crimea, ethnic Ukrainians constituted a majority in the pre-conflict Donetsk and Luhansk oblasts (provinces). With the number of internally-displaced persons and refugees estimated at more than 1.5 million, the ethnic breakdown now is less clear. Crimea was the only part of Ukraine where ethnic Russians made up a majority of the population.

The east/west divide holds generally true for language use, but that also over-simplifies the situation. Kharkiv in the east is a Russian-speaking city, but it is surrounded by villages where Ukrainian is the first language used. I found Ukrainians pragmatic in this regard. If they do not speak both Ukrainian and Russian—or Surzhik, a mix of the two—most understand both. Conversations in which one person speaks Ukrainian and the other Russian are not unusual.

During my assignment to Kyiv from 1998 to 2000, I made a number of visits to what was regarded as eastern Ukraine. People there tended to speak Russian and wanted good relations with Moscow, but they generally saw themselves as Ukrainians. The impression of national identity was not nearly as deep in Donetsk or Kharkiv as it was in Lviv, but one could sense it. It struck me as an important point, which ran against the concern raised in the earlier National Intelligence Estimate. I stressed that point to Vice President Al Gore when he came to Kyiv in July 1998.

Over the course of the 2000s, the east/west dividing line continued to blur. For example, the results of the 2006 parliamentary elections showed the Party of Regions (an “eastern” party led by Victor Yanukovych) making inroads in western and central Ukraine, while the Bloc of Yulia Tymoshenko (a west-leaning party) scored gains in the east.

A public opinion poll, conducted in April 2014, just as the first separatist actions began in Donetsk and Luhansk, confirmed this blurring of the divide. It showed that, while large numbers of people in Ukraine’s east were uncomfortable with how power had changed in Kyiv during the Maidan Revolution, a large majority favored remaining part of Ukraine.

To my mind, all this shows the real tragedy of what has happened in Donetsk and Luhansk since March 2014. Left on their own, Ukrainians could have worked out their differences peacefully—or at worst with a fraction of the blood that has been shed the past 15 months. Instead, the Kremlin inspired, provided leadership for, and equipped an armed separatist conflict. It later sent in regular Russian army units. As a result, more than 6,000 people have died.

Outside of that portion of the Donbas under separatist and Russian control, which amounts to only three or four percent of Ukraine’s territory, Russia’s aggression appears to be erasing the dividing line. It is bringing Ukrainians together.

This was evident already when I visited Kyiv in September 2014, just after the Russian army had entered the Donbas to attack Ukrainian forces. One long-time Ukrainian contact told me: “Vladimir Putin has realized the dream of centuries of Ukrainian nationalists. He has forged a strong sense of national identity.”

That sense of identity extends across most of Ukraine. When I was in the country this January, I had the opportunity to drive from Dnipropetrovsk (which most would regard as in eastern Ukraine) to Kramatorsk, the field headquarters of the Ukrainian army in northern Donetsk oblast, about 45 kilometers from the line of contact between Ukrainian and separatist/Russian forces. The most striking thing while passing through towns and along the roads were the same manifestations of Ukrainian national identity that one could see in Kyiv: Ukrainian flags and their blue and yellow colors painted on fences, buildings, and road-markers.

One unintended consequence of Putin’s nasty little war is this sense of Ukrainian unity. The Russian president may himself recognize what his policies have done. He spoke often in the spring and summer of 2014 about “Novorossiya,” which Russians envisaged as stretching from Luhansk in the east to Odesa in the west, encompassing as much as 40 percent of Ukraine’s territory. Putin no longer mentions “Novorossiya”—most of that territory and its population are now firmly committed to Kyiv and the state of Ukraine. Pushed along by the Kremlin’s misguided policies, Ukraine’s east/west divide continues to erode.