Monday, July 14, 2014

Ukraine's Multi-Dimensional Importance

There are many things that are clear about the nature of Ukraine prior to the ouster of their President Yanukovych. One of the clearest is the extent to which the government economically sapped the people, requiring bribes and kickbacks at every stage of any business deal of significance, and the other is the extent to which the Yanukovych and Putin regimes were identical.

It's extraordinary how quickly we're learning all of this: the billions of dollars spent on the Sochi Olympics, with the obvious errors and cost overruns being something a source of humor, but also an indicator of how deep the corruption runs.

Then, the well documented rise of dubious oligarchs who somehow procured portfolios of Russian businesses despite living in a society where investment capital was nonexistent was mirrored in Ukraine, and even amplified.

Almost incredibly, these people seem to have no sense of duty to their foreign customer base, their local customer base or, with minor exceptions, any sense that they need give back at all to the society that they stripped of its commercial value.

We don't understand what it is like to live under a totally corrupt government. The police coming up and demanding money because you are in a public place. If you have a job, you need to bribe landlords to keep your place, along with extortion level rents-- and if your address is in a nicer neighborhood, you just might be visited by goons and asked to leave. If you own a business, the rules have been crafted so that every single transaction has some bribe or kickback involved. There is no judicial branch to appeal to: they're all in on it. There is no "congressman", "councilman" or news outlet to write to. They're all in on it.

This is the situation that precipitated the revolution in Ukraine, and it explains the behavior of all the people involved. If you were one of the thieves, you saw the jig was up and you ran. If you were one of the victims, you couldn't take it anymore. If you were retired, getting a pension, you were maybe upset by the upheaval.

This sort of revolution in Russia is what Putin fears most: that the Russian people that have been fleeced just can't take it anymore. They start to protest en masse, and the minor, then major, regime functionaries see that the jig is up: they stop following orders and go with the tide.

The grab of Crimea raised Russian's hopes for a while: at least someone else was getting fleeced, even better to the surprise and embarrassment of the snooty and foppish EU, and especially the arrogant and conniving anti-Russian US.

Over it all, their President commanding a podium on the world stage, confident and forceful: not like the clowning Obama or the flustered Merkel!

But with that grab, Putin wrote off Ukraine. If he could cause the rebellious country to fall apart, so much the better--  volunteer mercenaries wanting adventure might assist with that, they would be equipped. So, some eager beavers were given the opportunity to field such a force, and equipment staged near the border with Ukraine for their ready use.

This is what happened: it was planned well in advance, the core units were trained, more recruited. As an garnish, an inspiring story involving historical precedent and privilege was spun and wrapped around the whole plot.

People in Ukraine have experienced some real hardships. Many of the people in the East above 40 are not highly educated. Farmers, factory workers, miners. They were trained under Soviet rule not to expect much, but to expect at least something along the lines of welfare no matter what, and this runs through that demographic.

This is the key, you see: in the Soviet "workers paradise", everyone was supposed to own the means of production. If that was so, then their 'slice' was auctioned off at a bargain price, or maybe not even auctioned but simply "transferred" through corrupt clerical sleight of hand to a cunning oligarch.

Putin has identified the US as having the purpose of thwarting Russia: the U.S. wants Russia to have zero advantages in his view, and the U.S. strives to ensure Russia is marginalized, inconvenienced and disrespected.

It seems this way because Russia is a corrupt state and acts as one, where the U.S. is much less so. The U.S. prefers to work with countries that share the same sort of notions of reciprocal regulation, open investment and commerce, where Putin's Russia will put up with what they have to, but not because  they think it's a good idea. For example, foreign investors in Russia being arbitrarily dispossessed of their businesses through specific machinations of the bureaucracy is ok, if that's what the leadership wants and thinks they can get away with it.

What has happened iin Russia and Ukraine is truly frightening: people have been bribed, threatened, violently injured and worse so that a cadre of billionaires, are mentioned in the sanctions, could have their businesses for cheap and expand their portfolios. This is the way they operate, it is what they know and they want the whole world to be that way. No anti-trust mumbo jumbo, no FINRA, no SEC: just straight ahead ultra hostile no bounds set acquisition. They have amassed the wealth to be able to operate that way with impunity in Russia, and irritates them it's not like that everywhere!

So of course they see  U.S. as making up rules that make it hard for them to do what they want, just to irritate them. This is what an egomaniac would think.

Understand, then, that Ukraine is currently a battleground where this amoral, self-serving clique of billionaires wants a cozy pocket of corruption to operate in. Thanks to these Russian military adventurers, the attempt is is being made to carve this out of the eastern portion of the country. At the best, they will achieve their aim. At the worst, they will be a constant source of disruption for the government in Kiev unless they're completely defeated.

Russian arms and fighters will continue to be pumped into this situation unless the Ukrainian army can close off the border securely. Then, without resistance from the people actually living there in Donetsk and Luhansk --poor people, battered people, people who stand to lose everything-- the billionaires' henchmen will continue to have their way.

It doesn't seem hopeful: the city of Donetsk is built to hold a million people. It is an valuable economic asset. Even if all the non-combatants leave the city, the occupiers will force the Ukrainian army to destroy portions of it, which they already have. The night fighting equipment, stealth aircraft, the armed drones, the laser guided munitions that the U.S. is able to bring to bear in narrowly targeted strikes are not in Ukraine's arsenal.

Instead, both sides are using "Grad" (Hail) systems, aptly named multiple rocket launching systems, artillery, and air ground rockets that saturate an area with explosives. The sorts of things you aim the best you can and hope you don't hit the wrong things. The most useful platforms are those in the air, but the Russian occupiers now have support from sophisticated anti aircraft missiles.

Russia is acting as much "within the rules" as it thinks it has to-- that is, as much outside the rules as can away with. All the other countries involved are acting within the rules because they are the "keepers" of the rules, but also because it's comfortable.

It's coming down to this battle being fought in the hearts and minds of each Ukrainian involved: will they take arms and which side? Will they hide, and if so can they report intelligence on social media-- but for which side? Or will they leave, and for where?

Each decision inches the vector of history this way and that.


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