Tuesday, September 2, 2014

Contradictory Choices in the Middle East [Part I] - The Islamic State and the West's National Unity Fetish

Introduction and Historical Retrospective

Western policymakers and media talking-heads like to believe that the answer to the wider Middle East's problems lies in a single, coherent regional strategy. In other words, a sufficient balance of military force and support for the proper state players will yield lasting calm and neutralize emerging ideological threats. Not only does this view starkly contrast with the approach taken to regional problems of the past, it also places those searching for solutions in a strategic straitjacket.  Why should such a diverse region be viewed from a macro, rather than a micro, perspective? Richelieu and Bismarck never confronted the problems plaguing Europe in their eras this way, nor did the British, French or Portuguese in their overseas empires or spheres of influence. 

Contrast the formation of what became South Africa in 1910 with Transjordan in 1921 by the British. Although both proto (and eventual) states were created a mere decade apart, the assumptions underlying their establishment could not be more different. 

South Africa grew out of a series of sectarian conflicts fought by Britain against black and white tribes in its quest for imperial continuity and resource aggrandizement. Although the administration of the Union of South Africa was left largely to the white Boers (defeated less than a decade earlier in the Second Boer War), it would be a fair statement to say that the new rulers never actually sought to rule what they were ruling. On the contrary, the core of Boer culture, language and historical identity as a people was cemented in the Great Trek away from British rule in Cape Colony into the South African interior. A hundreds of Boers set out in the 1830s and 40s to put as much distance between them and the British as possible, which led to the emergence of two independent republics. These same Boers negotiated treaties with local black tribes, which themselves controlled swaths of territory in Natal and southern parts of the territory. British ambition upended the regional order, destroyed the independent hopes of these groups and forged a nation which nobody wanted. Instead of restoring the area to its status quo ex-ante (for example, by giving the Boers back their republics, the black tribes their kingdoms and the Anglo colonists a state along the Cape) the British fused a unified state from a hodgepodge of communities together and left the dazed residents to pick up the pieces. 

Now compare South Africa with Transjordan, which Britain formed ad hoc in violation of its obligations as a mandatory power to the League of Nations following World War I. As wittily described by The Economist in a brief article, the substance of the country's creation (and that of its Syrian and Iraqi neighbors) was a desire by the Western powers to install reliable tribal puppets and cut down on administrative expenses in controlling the remnants of the vanquished Ottoman Empire. One could almost call the establishment of Hashemite rule in Transjordan (which continues to this day) as an accident of casting (i.e., a brother wanted Syria, was not deemed acceptable and sent to Iraq, and the other brother got Transjordan as a consolation prize). There was no attempt to forge a national identity or any decades-long campaign to snuff out independent entities which existed in the area. Rather, the British went to the most prominent and seemingly well established tribe they could find and put it in charge of three-quarters of Britain's mandated territory notwithstanding that the overwhelming majority of the population of the new country had a different tribal allegiance and was not too pleased with the new regime. 

The lesson of South Africa and Transjordan is that one size does not fit all when it comes to creating regional order or achieving long-term strategic objectives. Sometimes a great power has to show flexibility and treat even proximate security threats as if they have nothing to do with each other and orbit in different galaxies. Consider the Islamic State and the Twilight Zone of modern Iraq.  

The Islamic State - the West's National Unity Fetish

The West is obsessed with maintaining a unified Iraq. I recently called into a national radio show to discuss the rise and expansion of the Islamic State (and possible responses in the aftermath of the massacre of American journalist James Foley and hundreds of Syrian army prisoners). The guest, described as a foreign policy expert with a military background, repeatedly called for regional Arab powers to intervene in Iraq so as to "assist" the Iraqis in their struggle to oust the Islamic State in those parts of central and southern Iraq it now controls. This appears to be the prevailing wisdom in London and Washington, as expressed in President Obama's recent statements regarding the necessity of a regional coalition and inclusive government in Baghdad under Prime Minister Abadi to sway local Sunnis away from the Islamic State and into the arms of (fill in the blank) to bring the Islamists under control. Interestingly enough, it was probably Iran's endorsement of Abadi that sealed ex-Prime Minister Maliki's fate and peeled away the last bastion of Shiite support for his sectarian government. How Abadi will repay Tehran's endorsement (and how this will impact Washington's calculus) can be examined in another post. For now, it is important to note just how confused Obama's rhetoric of inclusiveness and national unity in the Iraqi context is when reduced to its substance. 

While Turkey has for years engaged in side transactions and negotiations with the Kurdish Regional Government in northern Iraq and Iran has maintained close ties with Maliki's government, the United States and the western establishment persisted in their goal of a multicultural Iraqi nation-state akin to something between South Africa and the former Yugoslavia. Attempts by local tribes to make separate arrangements with Washington have been ignored or rejected, be they attempts by Iraqi Kurds to sell oil extracted from their autonomous territory to western ports or possibly declare unilateral independence (something Washington seems to especially fear) or grumblings by Sunni tribes to get political protection from the Shiite forces in Baghdad.

Although it would appear strange to imagine a reality where "moderate" Sunni forces (mostly former Saddam loyalists and rural clans protected by his regime) would be content with an Iranian-endorsed "moderate" Shiite government in Baghdad on a long-term (possibly perpetual) basis, that is precisely what Washington is pushing them to accept. Some particularly prominent tribal leaders, including Sheikh Ali al-Hatem of the sprawling Dulaim tribe, went so far as to call on followers to wage war on Iraq's Shiite militias with the same ferocity they are using against the Islamic State. Add to this the more radical sectarian factions such as those beholden to Shiite cleric Sadr and you have something which makes no political sense. A unified and harmonious Iraq is, in other words, as fictional as Neverland. Most importantly, this exercise in futility underscores the danger of misusing the word "moderate" outside of its geographical limitations. Tribes bound by clan loyalties care about clan identification, not political persuasion, when deciding who to support.

Instead of waiting for a white knight to turn Baghdad into Chicago, western leaders should embrace the benefits of an Iraq splintered along tribal lines. Rather than push former Ba'athists and quasi-Islamist Sunni tribes to work with an Iranian client regime and Kurds with one eye on independence, perhaps Washington should make tactical deals with individual Sunni tribal leaders (as Iran, Turkey and Saudi Arabia have done to varying degrees) as a prelude to establishing a reality of autonomous clan-controlled zones on the ground in much of Anbar and Sunni-majority Iraq. The Shiites can keep a rump state in the east and the Kurds should receive support for self-determination in the north. This was an approach rejected in Afghanistan when, again, Washington preferred to prop up a corrupt and illegitimate kleptocrat while letting three-quarters of the land functionally fall to the Taliban. 

As previously noted on these pages, the Islamic State is an unruly instrument of the Gulf States and Turkey which veered from script during the height of the Syrian Civil War. In that previous post I underscored how much of the Islamic State's (then called ISIS) military success came because of tactical pacts with local Sunni leaders exasperated with Washington's backing of the Maliki government and reluctance to countenance any side deals. Now the same choice (albeit achievable with greater cost in lives and treasure) confronts the United States - keep forcing the square peg of tribalism into the round hole of a unified Iraq or accept that Iraq is functionally extinct and forge a multi-tribal strategy which interfaces with sub-national leaders while sidestepping Baghdad. One only hopes the medicine on the table will be taken and correct decisions made before the farce of the present degenerates into a calamitous future.





Monday, June 30, 2014

Heists and Revolution: Sales of Stolen Artifacts and Gold in Bolshevik Russia and ISIS-controlled Syria/Iraq


In December, 2008, the Russian government announced the creation of a state commission to study the legality of the sale of artwork, jewels and artifacts by the Soviet government in the 1920s. In so doing, Russia turned its attention to a frequently overlooked and almost forgotten chapter in its early, post-revolutionary history. That episode, with its dark consequences for Russian culture, provides a remarkably vivid illustration of how political revolutions grounded in radical, populist ideology, tend to hypocritically rely on base theft to feed the engine of continued conflict. As this analysis examines with the Bolsheviks and ISIS in Syria and Iraq, the source of the ideology does not make much difference.

Failure of "War Communism" – Fire Sale of Russian Antiquities

The confiscation of icons, gold objects, jewels and artifacts from museums, private homes and collections by the Bolsheviks, and their subsequent fire sale at bargain prices to speculators and collectors in the West, represented one of the saddest and most hypocritical episodes of the farcical workers and peasants revolution that supposedly occurred in October, 1917.  The farce was not so much the "revolution" itself, but the fact that in the elections for the Constituent Assembly which followed it in January, 1918, the revolutionaries received less than 25% support from the very soviets in whose name they supposedly took power. The workers and peasants were apparently not impressed with how swiftly the Bolsheviks, led by radicalized sailors and army deserters, took over a few strategic positions in Petrograd. The reaction of Lenin and Trotsky to the popular vote of no confidence? Shut down the Assembly and train loaded rifles on the deputies with a declaration that if they did not abandon the legislative building within twenty-four hours, their safety would not be guaranteed. This presaged not just the demolition of any hope of democratic governance in post-revolutionary Russia, but a series of policy zigzags which brought the country to near total economic ruin.  

The Bolsheviks succeeded in turning a country with a pre-WWI annual economic growth of 8.8%, industrial output just behind the U.S., Britain and Germany, a population of 175 million and rising and Europe's largest gold reserves to one with recurring famines (over 6 million died in the Volga famine of 1921), urban dwellers tearing down the walls of their homes to provide heating material, peasants' and sailors' revolts and nearly exhausted hard currency reserves.  Placing the blame on WWI was a popular meme of Bolshevik apologists for decades, until new historical evidence emerged of an economic boom during that period with a huge convergence effect for Russian industry. As Sean McMeekin wrote in his landmark bookHistory's Greatest Heist: the Looting of Russia by the Bolsheviks, Russia in 1917 (the year of revolution) was less an economic backwater than a casino of speculative investment which fell apart at just the wrong moment.

Following the October seizure of power, the Bolsheviks set about implementing a program of so-called "War Communism" (some of the consequences of which are mentioned above), among whose policies included the confiscation and nationalization of Tsarist treasure, private collections and museum holdings. In the Fall of 1918, the regime issued a decree - "on the registration, accounting and storage of monuments, artwork and antiquities" - which required every Soviet citizen to publicly register all valuables within one month, from artwork and carpets to ornaments and gold jewelry, on pain of forced confiscation and imprisonment (and likely execution). As chronicled by Russian historian Nikolai Svanidze, the decree imposed a prison term for anyone who failed to "properly store" their artwork. The loot, along with confiscated goods from Tsarist palaces and museums, was brought to Petrograd for inspection by a special commission. 

In 1920, Lenin personally undertook to empower the commission and accelerate the sale of Russian artwork overseas. When the so-called People's Commissar of Culture appealed for clarification regarding what was intended to be left for national museums, Lenin promised only the "required minimum" of art and artifacts, with the rest to be sold for hard currency. These shocking measures not only underscore the utter contempt the Bolshevik regime had for the country it found itself governing, but also the degree to which their desire to achieve and retain power trumped any pretense of ideological devotion. While peasants starved and workers rioted, the Bolshevik political class was busy making side deals with European and American capitalists over Russia's historical treasures to fuel its war machine. 

Worse than the deed itself was the price at which a nation's priceless cultural heritage was carted away. Lenin and Trotsky, as part of the operation to accelerate the sale of confiscated items, created a government collection and special diamond fund.  The diamond fund put the Tsar's family jewels on display in round the clock auction exhibits for foreign buyers, who acquired sumptuous crowns and rings, over 145 other ornate objects and 7 FabergĂ© eggs at discount prices ranging from 500 to 5,000 gold rubles which, according to Svanidze's research, was about the cost of feeding 10 Gulag prison guards for one month in 1930. The Hermitage Museum in Petrograd (now Saint Petersburg), lost most of its Rembrandt collection to the fire sale and at least one curator killed himself for failing to protect several pieces from export. Perhaps a full accounting, even by the Russian government's investigators, will never be done of the artifacts from churches, private homes and royal residences which were simply melted down and sold as bullion on foreign metal exchanges - Trotsky was particularly aggressive in this area.

Thieves at Allah's Service - ISIS and Iraqi Gold

report from Bloomberg dated March 25, 2014 revealed that the Iraqi government had purchased $1.56 billion worth of gold (36 tons) during that month - the largest purchase in three years. This huge intake followed a steady increase in private gold purchases throughout the country - a rise in demand for bullion coupled with an outflow of foreign currency from the country's banks. The autonomous Kurdish region in northern Iraq became a major gold import artery, with an estimated 50 metric tons of the metal coming through during the Summer of 2013 alone. Faced with unsophisticated securities markets and a weak banking sector, citizens turned to gold as the only viable means to store wealth and hoarding became commonplace.

Beyond gold, the fate of Iraq's antiquities has been a sore subject since the U.S. invasion of 2003 and the infamous spate of looting which accompanied the collapse of Saddam Hussein's regime. Over 15,000 artifacts were lost in the mayhem of Baghdad's capture and the U.S. army created a special cultural unit to recover collections and pieces for the National Museum of Iraq. The efforts of U.S. forces, coupled with targeted amnesties for the civilian population, led to several thousand artifacts being restored to the Museum, including 613 pieces of Assyrian gold jewelry. Now, with ISIS (renamed the "Islamic State") having secured Jordanian and Saudi border crossings and encircled Baghdad, the fate of Iraq's gold and cultural heritage located within the Islamist zone of influence or direct control should emerge as a matter of top priority. Naturally, western media and policymakers have chosen to more or less bury this aspect of the ISIS campaign in favor of purely military assessments. 

The relationship between ISIS and Iraq's treasures is almost identical to that of the Bolsheviks in Russia. A group which seeks to purify the souls of its subjects and impose strict Sharia law over the areas it controls - destroying graves and shrines, keeping women out of public view unless absolutely necessary and banning alcohol, drugs and cigarettes - is financing its war machine with a highly efficient smuggling operation. How ironic that the same people who cut the hands off thieves in the public square shamelessly engage in naked bank robbery and black market fire sales of stolen goods.  And yet, beyond the estimated $500 million in loot from Mosul banks, ISIS has netted tens of millions from illicit sales of artifacts from across Syria and Iraq - $36 million in one region of Syria alone according to one report. Sam Hardy, a research associate at the UCL Institute of Archaeology in London, has written extensively on ISIS activities in the international artifacts market - particularly in Syria and Mosul where the city's museum, shrines and churches have been looted. This comes on top of the jizya tax which the group has imposed on Christians and other non-Muslims in its areas of control. That tax, levied on religious grounds, parallels the Bolshevik confiscation directive in its execution. 

If ISIS succeeds in taking Baghdad (a prospect considered increasingly unlikely with each passing day) or consolidates control over more outlying territory in Shia or Kurdish-controlled Iraq, there appears little doubt that the looting of museums and banks will shift to confiscation of private gold holdings; this makes the protection of Iraq's gold as important as safeguarding its territorial integrity (to the extent this is still possible) for any foreign powers determined enough to intervene against the ISIS-Sunni alliance. In 1936, Soviet dictator Joseph Stalin engineered the theft of Spain's gold reserves in a top secret operation (codenamed "X") in which 500 tons of bullion, coins and jewels were spirited away by barge to Odessa, transported to Moscow and stored in a Kremlin vault. Stalin allegedly exclaimed that the Spaniards, who foolishly agreed to hand over the gold for safekeeping in return for continued Soviet support against Franco's Nationalists, would not see their gold again "just as they do not see their ears". Perhaps this type of extortion is being carried out by ISIS and Shia militants at a micro level across Iraq now. In any case, it is incumbent upon Iraq's neighbors to take steps to preserve the country's cultural heritage and intercede between ISIS and the treasures presently within its grasp.





Tuesday, June 17, 2014

ISIS - the Gulf States' Unruly Instrument: or Why the United States Should Not Reengage in Iraq

Hitler - Stalin's instrument run amok

"Icebreaker" was Adolf Hitler's designation by Soviet intelligence. The fall of the Soviet Union gave historians access to documentary material sealed for decades behind layers of obfuscation, lies and half-truths. Papers which Moscow consistently denied as ever having existed reporting on meetings which ostensibly never took place suddenly became public knowledge. It is not surprising, then, that a primary area of new research focused on the seemingly beaten down topic of the Second World War. It would appear that almost everything which could be written or said about that conflict has been and the narrative is as unassailable as a mathematical proof: Adolf Hitler's Germany invaded Poland on September 1, 1939. Two days later, Britain and France declared war in line with their guarantees of Polish independence. The Soviet Union intervened, officially to "protect" eastern Slavs from "fascist" oppression (in reality in accordance with the infamous Molotov-Ribbentrop Protocols to partition Poland), on September 17. One German victory led to another until a setback over the skies of Britain, the invasion of Soviet Union on June 22, 1941, America's entry into the war after Pearl Harbor and Germany's eventual defeat.

There could be no question as to whose hands were dirtiest regarding the start of the conflict and that World War II was Germany's war. Stalin's arrangement with Hitler was rooted in survival and when that expired with the latter's invasion, the Soviet Union quickly joined with its ideological foes to defeat their more vicious, common enemy. South Carolina Senator Lindsey Graham referred to this telling over the past couple of days when he urged the U.S. to tacitly align with Iran in order to prevent the Sunni Islamist ISIS militia from seizing Baghdad and toppling the Iraqi Shia government of Nouri al-Maliki. We dealt with Stalin because Hitler was worse, exhorted Graham. Iran could provide assets, along with Turkey, to stop ISIS (presumably with American air power) and keep the Iraqi government afloat. 

Unfortunately for Graham and the U.S. national security establishment, the consensus tale of the Second World War's origins has been savaged by a series of sensational revisionist accounts. Most prominent and convincing of these comes from former Soviet intelligence officer and historian Vladimir Rezun (aka Viktor Suvorov), whose research was published for mass distribution in English five years ago  under the title: The Chief Culprit: Stalin's Grand Design to Start World War II

Suvorov's work effectively links Hitler's rise to power to a grand design by Stalin, his Politburo and the Comintern based in Moscow to spark a world revolution through Germany. Far from being a fool who struggled, in vain, to stave off war with Germany, Suvorov contends that there would never have been a war, or a Nazi Germany for that matter, but for Stalin's efforts. From Stalin's intervention to prevent the German Communists from uniting with the Social Democrats to form a political block against Hitler in the 1932 German Reichstag Elections to coordinated violence between the Nazis and the Communists against the Social Democrats in East Prussia to the active military assistance provided to Hitler's rearmament efforts in the early 1930s, Suvorov dots the "i's" and crosses the "t's" with Stalin's own dispatches and meeting transcripts to show that the Soviet dictator paved Hitler's road to power. 

Stalin considered Hitler a valuable (almost indispensable) asset to instigate a European conflict and give the Soviet Union the opportunity to finish the unfinished business of 1918. The Soviet leader gave orders to the German Communists that they were to consider the Social Democrats, rather than the Nazis, their primary foes as early as 1927. Moreover, it was Stalin's financial support for the Nazi election campaign in 1932 that is partly credited with saving Hitler's movement from bankruptcy. Such support continued until hours before the German invasion in 1941 when trainloads of iron ore and grain were being sent across a border lined with millions of German troops and tanks. In this context, what happened in August 1939 and the invasion of Poland was no mere gamble by Stalin to buy his country time from a hostile Germany, but a tactical move to make Germany the aggressor in a European conflict that would draw in the West European power who, Moscow hoped, would keep Hitler occupied for at least 2-3 years. Unfortunately for the Soviet leader, the protracted war in the west ended in seven weeks and Hitler headed east well ahead of schedule. While this resulted in Germany's defeat, Stalin's grand design for a takeover of continental Europe was thwarted.

Thus, Hitler became Stalin's instrument run amok. Unleashed by the Soviet dictator upon Europe to bring the continent to its knees, he deviated from script and nearly destroyed the sponsor.

ISIS - the Hitler to the Gulf States' Stalin

The relationship between Stalin and Hitler during the prelude to the Second World War provides an almost perfect analogue to the current crisis in Iraq with the Sunni ISIS militia army. Although a basic knowledge of ethnic and tribal loyalties in the Arab Middle East would make it a common sense assumption, there is now considerable evidence that the "seed" funding for ISIS, when it was just an Al-Qaeda splinter outfit in Syria fighting alongside the al-Nusra Front and other Sunni Jihadist groups against the Assad regime, came overwhelmingly from the Gulf Sunni states - chiefly Saudi Arabia, Kuwait and Qatar. These countries have played the double-game of funding extremists in peripheral conflicts whilst keeping them suppressed at home for many years. 

In the case of ISIS, the money came from wealthy backers through a variety of channels ranging from personal donations to money laundering schemes to sham bank accounts backed by Gulf governments. To think that private individuals in repressive and tightly regulated Arab states could funnel millions of dollars to Syrian Islamists without at least the tacit backing of their host governments is naive at best. Although these countries have publicly denied any direct involvement with ISIS and its allies during the opening stages of the Syrian Civil War, they were not especially cooperative in response to pressure from Washington for a comprehensive crackdown on the group's financing networks. In short, ISIS would have never gotten off the ground (as Al-Qaeda before it) without substantial assistance (in men, money and material) from the very Gulf States which are now supposed allies of the U.S. in its War Against Terrorism. In other words, the ISIS is the Gulf States' instrument to achieve specific regional objectives - chiefly against arch-rival Iran and its affiliates, allies and satellites.

ISIS deviates from script in Syria and Iraq

Unfortunately for its Gulf backers, the ISIS appears to have radically deviated from its predetermined role. Having consolidated a foothold in northern Syria in the wake of successful counteroffensives by Assad's forces (mostly equipped by and through Iran), it has swarmed over the border to take advantage of Sunni agitation with the Shia government in Iraq. To make a long story short, there is no way that 800 militia on flat-back pickup trucks could route 30,000 trained and equipped Iraqi troops without substantial popular support. That support came from Sunni tribal leaders in the major cities of Mosul and Tikrit as well as neighboring villages, as corroborated by those on the ground such as Sheikh Abdel-Qaderal-Nayel and experts such as Ben Connable of the RAND Corporation. Some Sunni leaders have even tried to blackmail the U.S. into staging a military response by threatening to join the ISIS if support were not forthcoming. Like the welcome German forces initially received in Ukraine and the Baltic States in 1941, it appears that fear of Jihadists prone to mass shooting and beheading is counterbalanced with hatred for Baghdad's Shia government. 

Yet the scale and speed of ISIS' advance might well sow the seeds for not only the group's ultimate demise, but a new regional order from what is left of Iraq. Having begun as a paramilitary unit conveniently positioned against the Gulf States' regional rivals, ISIS has grown into its own organism, unhindered by past constraints. It now controls a quarter of one country and almost half of another, significant oil reserves and over $2 billion in hard assets (not including taxes extracted from small businesses and merchants in areas it controls). With a mind and objectives of its own, there is no reason to believe its thirst will be quenched in Baghdad. More likely, as shown by stepped up recruitment and propaganda efforts inside the Kingdom itself over the past week, ISIS may put itself in a position to directly threaten the borders and power structure of Saudi Arabia and its allies (a brief look at where its forces currently stand in Iraq makes this appear all but obvious). It appears that, just like Stalin with Hitler a century ago, Saudi Arabia and its neighbors have let a genie out of a bottle which is poised to overtake them.

Saudi/Gulf intervention and stalemate with Iran

It is precisely because the ISIS has gained the capability to threaten Saudi Arabia's borders and slice away most of Sunni-populated Iraq that the U.S. should not intervene (directly or indirectly) to resolve the present crisis in favor of either the Sunni or Shia factions in the region. There is no need to speculate about what Riyadh will do when, if events should reach such a juncture, ISIS decides to turn its attention south and ignite efforts to undermine the Saudi royal family (tagged as traitors and American lackeys by Al-Qaeda). When faced with a choice of ideology or survival, Saudi King Abdullah has repeatedly gone with the latter. The same regime which sponsors Islamists in Syria has cracked down on Al-Qaeda at home and sent millions in financial support to Egypt's military government against the Sunni Muslim Brotherhood. Consequently, just as the Saudis sent tanks into Bahrain to quell riots tied to the Arab Spring a year ago, they will swing into Iraq the minute they feel their personal survival threatened. 

With Saudi tanks in Iraq to reign in the ISIS and Maliki's government effectively controlled by Iran (more so in the aftermath of the current Sunni uprising), something resembling a Cold War stalemate will develop. Modern Iraq, carved out of whole cloth in the aftermath of the First World War, will be divided de jure as it has been de facto - the Kurds consolidate in the north (to the detriment of Turkey and the benefit of everyone else), Iran turns the Shia areas east of Baghdad into its greater prosperity sphere and the Saudis (assisted chiefly by Kuwait) hold sway over a Sunni autonomous zone in the center and west. I would not be surprised if, behind closed doors in a neutral area somewhere in central Iraq, Saudi and Iranian representatives meet quietly (as Hitler and Stalin before them) to delegate spheres of influence. 

Nowhere in this design is American intervention wanted or needed. Strengthening the hand of one regional faction at the expense of another is not, and never has been, in Washington's interest. We have a unique chance, now, to let the region ossify into a lasting stalemate anchored by the stable power centers. Europe had its Thirty Years War. Persia and the Ottomans had theirs for over a century. Washington should not make today's Middle East ours.   








Thursday, June 5, 2014

Obama's speech in Warsaw - Russia as Europe's antagonizing "other"

Obama's speech - Russia is not a European state

U.S. President Barack Obama gave a speech in Warsaw, Poland yesterday and painted a portrait of contemporary Europe which holds profound significance. In effect, Obama proclaimed that Russia and Europe are two different things (i.e., Russia is not a European country or a nation which can be countenanced as belonging to the same family). Putting aside the false characterization of the European Union institutions headquartered in Brussels and Strasbourg as "Europe", which some would say was really what Obama meant, the wall of separation between Moscow and Europe (and more generally the West) per se was made explicit in the President's remarks.  Obama described Ukraine as a buffer between "Europe and Russia and the United States and the rest of the world". He then contended that "[O]ur free nations will stand united so that further Russian provocations will only mean more isolation and costs for Russia.  Because after investing so much blood and treasure to bring Europe together, how can we allow the dark tactics of the 20th century to define this new century?".

In the President's view, therefore, "free nations" and Russia are separate concepts. Russia is a "bully" and "provocateur" whose "dark tactics" are causing instability and fissures throughout Europe. Obama went on to proclaim that today's Ukrainians (including I assume the ones in Lvov honoring Waffen SS divisions and demanding that symbols honoring the defeat of Nazi Germany in WWII be placed on a list of extreme paraphernalia) are the "heirs of Solidarity". Either Obama's speechwriters (or Obama himself) are utterly oblivious to historically based rhetorical signals or they purposefully meant to insert this language. What this tells the average Russian, and most certainly an established member of Moscow's educated class or intelligentsia, is that the West still regards him/her as not one of it. They may study German or French, stand in line to see Rembrandt at the Hermitage, learn about Russia's pivotal role in maintaining European peace in the aftermath of the Napoleonic Wars or that their greatest empress was a Prussian princess, but as far as Obama and the attendees in Warsaw are concerned, they are permanent outsider in need of containment rather than engagement - a remnant of the Soviet Union pursuing unremitting expansionism.  
Obama's speech read like one Fmr. President Harry Truman may have given in 1946 or Fmr. President Ronald Reagan in 1982. Truman needed to initiate containment after the diplomatic route which his predecessor suffered at the hands of Stalin, both because of Fmr. President Franklin Roosevelt's own naivete regarding the Soviet dictator's intentions and the fact that many within the President's inner circle were NKVD (Soviet secret police) assets.  Reagan, operating from a position of strength (i.e., a Soviet economy completely dependent on artificially priced energy exports and loans from Washington-supported financial institutions) could afford to tighten the screws on Moscow and open a channel to the Soviet public in an effort to further discredit a regime which had lost its basic legitimacy decades earlier. 

Obama is facing a different Russia and a different Russian public.  Sure, Putin may have neo-imperialist aims, if only to strengthen his domestic support, prevent a feckless opposition from reorganizing and cling to power at all costs (contrast Putin's supposed obsession with saving Russian life in Donetsk with his merciless "anti-terror" operations in Beslan and Moscow's Nord-Ost, where hundreds of men and women (and many children in the case of Beslan) were cut down so as to maintain the mirage of the state's invincibility in the face of its enemies. Similarly, compare Putin's fear of "fascist" violence and harassment of Russians in Ukraine with his indifference to similar violence occurring against Russians in Turkmenistan, whom one could argue Putin abandoned for energy concessions. But a regime is not necessarily its people and to merge the two is to block avenues through which to drive important wedges and advance your own interests.

For all of the new restrictions imposed by Putin on NGOs, independent websites and political parties, there is no question that Russian society is many times more open and engaged with the West today than at any time in its modern history. Russian commercial engagement extends beyond the energy sector. Russian students flood German, Swedish, British and French universities on exchange programs. Russians travel to all corners of the globe and relax in the Spanish Riviera. Nobody is preventing yours truly from calling his friends or family in Moscow to take the country's pulse. In other words, the people who matter in Russian society (literate, engaged and economically middle to upper middle class) know and appreciate what is happening around them. So what Obama has done is to take this group, many of whose members consider themselves to be European or western, and cut them off.  To add insult to injury, he spoke about the "blood and treasure" that "we" spent to "bring Europe together". Who exactly is "we" and which Europe has been brought together? Or perhaps the question should be rephrased to ask when was Europe brought together? If Obama referred here to the Cold War, NATO expansion or the EU, I do not understand the reference to mass bloodshed. If he instead meant the Second World War, then his statement is incredibly offensive to millions of Soviet soldiers and civilians who lost their lives liberating, from their perspective, Europe from Nazi tyranny.  To say that their sacrifices did not count or, worse, were driven to extend or preserve the very barbarism they struggled against, is beyond the pale. One has to distinguish what the soldier in the field generally believed and what his government desired. The Wehrmacht which invaded the Soviet Union in 1941, from its Chief of Staff to the frontline infantryman, was under no illusions that the invasion was one of conquest. The same cannot honestly be said about individual Soviet troops who entered Sofia, Warsaw and Budapest in 1944/45.

Playing into Putin's Hands

Not only has Obama unwittingly (or perhaps wittingly) reoriented American foreign policy in Europe by painting Russia as a permanent outsider, he has also played right into the narrative which Russian President Vladimir Putin has meticulously constructed over the past year with a renewed public relations campaign to promote orthodox and some would consider reactionary "Russian" values. Dr. Leon Aron, a premier Russia expert based in Washington for whom this author has previously worked, wrote about this in the Wall Street Journal

As Fmr. Russian President Boris Yelstin and others before him, Putin has taken on the mantle of a gatherer of supposedly lost or abandoned Russian lands as a means to distract from profound domestic problems. The Russian economy is slated to grow by barely 1% in real terms this quarter, Moscow's involvement in Ukraine has produced targeted sanctions and capital flight and the Kremlin is stuck providing for pensioners in annexed Crimea. Then there are the country's outer regions. While separatists were shooting down helicopters outside Donetsk, thousands in the city of Yaroslavl were dying from treatable illnesses due to collapsed infrastructure, ignored healthcare facilities and paltry incomes. This was the fiery report of Yaroslavl local legislator, former Governor of Nizhny Novgorod and Vice Premier under former Yelstin, Boris Nemtsov to a Ukrainian TV audience a few weeks ago.

Nemtsov's statements appear to corroborate distressing trends. Moscow's renowned Marshak Clinic, among the first private addiction treatment centers to open in post-Soviet Russia, released a study a month ago regarding the average age of alcoholics and drug users admitted to its facility for treatment. The results showed a decline in the average age of alcoholic of 7-10 years with a corresponding figure of 2-3 years for drug users. Russia's addicts are becoming younger and using more potent substances to reach their high. This has in no small part contributed to an explosion of HIV/AIDS within the country. Russia has gone backward in AIDS prevention and rates of infection, with the Kremlin refusing the consider or publicly mention radical solutions to stop the spread. Instead of allowing needle sharing programs (as even Margaret Thatcher did in the UK at the start of the AIDS crisis) and drug substitution treatments (as popularized in Holland), the official line appears to be a promotion of healthy living, sports and cultural awareness. While over one million Russians are estimated to be infected with the disease and drug users inventing horrific new concoctions (e.g., krokodil) to find relief, the Kremlin glorified its $50 billion Olympic spectacular and passed bills which prohibited "propaganda" of nontraditional sexual relationships directed at children.

Not all is lost, however, as there appears to be belated, limited improvement in Russia's demographic projections. City dwellers are wealthier and more established. Nemtsov himself admitted, as did other members of Russia's so-called liberal opposition (about whom I will write in a separate post) that incomes have on average doubled since the mid-1990s. Then we have this analysis of who actually constitutes the Russian middle class, courtesy of the opposition-oriented Moscow Times. With 79% of the self-identified middle class saying the Kremlin should be supported despite its flaws and 49% stating that Russia needed a firm hand, is it any wonder that Putin's calculated standoff in Ukraine has yielded the highest approval ratings he has seen in over two years?  As anecdotal evidence of the swell in support for the Kremlin, family friends we spoke with in Moscow in the immediate aftermath of Crimea's referendum (cultured and well-traveled scientists and mathematicians) were uniformly overjoyed that historic Russian territory had rejoined the homeland and thankful to Putin for achieving what his predecessor had not. 

Postscript

Winston Churchill led an international expeditionary force into Russia during its civil war to prevent a consolidation of Bolshevik power and to restore Russia to the family of European nations. Charles De Gaulle believed Russia was a European country and that China's economic rise would serve to bind it and the rest of Europe closer together.  Even the German political establishment believes that Russia must have a place at the European, if the not necessarily the EU, table. Obama's speech in Warsaw in response to the situation in Ukraine appears to have upended this long-held thinking. To the Moscow layman, the view from Washington is that it is still 1981, Russia is the Soviet Union with a new flag and the thoughts, aspirations and fears of the Russian president and the Russian public are one and the same.  Putin's PR machine would not want it depicted any other way. 

Monday, April 21, 2014

Rethinking Income Inequality

French economist Thomas Piketty is making a huge splash with his soon to be released book about income inequality — "Capital in the Twenty-First Century".  The New Yorker's John Cassidy provided a detailed preview, which follows growing calls by the media, public intellectuals and politicians for quick and aggressive government intervention to remedy the "crisis" of income divergence between the richest and poorest segments of the population in western countries in order to prevent chaos, violence and an end to democratic governance.
Piketty argues that a core of the problem is that returns to capital (and to its owners) have overtaken rates of economic growth such that wealth accumulation among the most affluent disproportionately exceeds gains in productivity (and earnings) by the masses.  The New Republic seemed beside itself over a lecture Piketty gave where he advocated a global, progressive wealth or capital tax to solve the problem. It appears that compensation packages received by "supermanagers" at large companies, coupled with political activism and inheritance laws, have produced a perpetual rentier class consolidating wealth at everyone else's expense.
It should be acknowledged that Piketty and his colleagues have amassed substantial, credible data on household incomes from various sources and, in some ways, have revolutionized quantitative analysis of wealth disparities. Nevertheless, and while improper to criticize a book before it has been published, it now appears a good time to respond to the income inequality chorus before Piketty and his champions monopolize the discussion.
While the inequality argument can be challenged on its statistical assumptions alone (see Thomas Sowell's piece on household versus individual income trends), I take a more fundamental, comparative approach and make two contentions: (i) income inequality should be compared across political and economic systems in relative terms rather than within one economic and political system over time; and (ii) income inequality borne out of voluntary exchange rather than cronyism (i.e., market rather than political income inequality) is both inevitable and a social good.
Whose income inequality is worse?
Decades before his election as Russia's first president, Boris Yeltsin was a Communist Party Secretary of the Sverdlovsk Oblast. Yeltsin worked to improve living conditions for families in his region, many of whom lived cramped in communal apartments well into the 1960s. He recounted in his memoirs that while the residents faced daily food shortages, poor living and sanitary conditions, and had to save for eternity to get new furniture or a car, he and his party colleagues lived like kings. Yeltsin had a summer house, a service car and a special section at local food stores set aside for him and other political bosses.
The disparity of access and treatment was not limited to Yeltsin or Sverdlovsk. It was understood by virtually everyone in Soviet society that unless one became a party member, certain jobs and luxuries of life were off limits. Ironically, an economic model ostensibly designed to aid the least fortunate had made them not only poorer in relative terms to even their poorest counterparts in the West, but produced income inequality an order of magnitude worse than anything decried by Piketty et al. The distinction between the Soviet "1%" and everyone else was who had a car, a refrigerator and functioning furniture. The parallel distinction in the United States, fundamentally, is who has a better car, a better refrigerator and nicer furniture.
The Soviet example is extreme, but yields an important lesson — income inequality is inevitable no matter what economic model a society chooses, but its size and substance vary. Whereas the inequality between a machinist and a corporate CEO in the United States may seem immense and abhorrent when measured in absolute terms, it becomes paltry and not so horrifying when seen relative to income differences between the political haves and have nots in non-market or weak market societies. In the latter, however, political connections are everything and one cannot hope to level the playing field or escape his station without them.
Is massive income inequality inherently wrong or unacceptable?
A counter to my previous contention would be, as noted, that the Soviet case is unrepresentative. We should instead consider the Nordic states and other democratic countries which have taken strides to contain returns to capital and compensate economic losers. Indeed, many of these countries consistently rank among those with the highest living standards and rates of "happiness" in the world. Instead of addressing this popular response now, except to say that real growth and social welfarism have been inversely proportional in some of these countries (possibly by as much as a third), I will make my second contention about income inequality (building on my first) — income inequality arising entirely or largely from voluntary exchange in a free market is neither wrong nor economically problematic.
Joseph Salerno, a renowned Austrian economist, has previously distilled this argument. Basically, a return to capital (to use Piketty's jargon) that comes from voluntary exchange and trade in a free market rather than cronyism and political favoritism should not be lambasted. Theft is theft no matter if the source is central bank inflation, social security transfers or corporate subsidies. The issue is not whether income inequality does or does not exist (or how much there is), but rather what kind of income inequality exists. Just as we don't hear attacks against "ballet inequality" or "basketball inequality", we ought not punish people for having higher incomes based on inherent traits or good decisions.
The corporatist versus free market income inequality distinction collapses Piketty's attack on the size of managers' compensation packages. Although committees (not individuals) do decide these on dubious grounds, their decisions are linked to what is best for shareholders and their businesses as a whole. If a board of directors pays a manager too outlandish a package and the share price takes a hit, the board risks a shareholder revolt at the next annual meeting. Compensation, like anything else in a business, does not exist in a vacuum unless it comes as a taxpayer donation (see, e.g., GM and Monsanto). Income inequality caused by corporatism (large businesses using government to enrich themselves and keep out competitors) should be decried, while the other kind should be accepted and praised. It is precisely this latter, good kind of inequality that generates greater capital investment, longer-term improvements in worker productivity, cheaper and higher quality goods and economic growth. As to what someone does with his inheritance, I apply the same principle — if he did not steal it, he can retain and enjoy it to the full.

Wednesday, March 19, 2014

Next Moves in Ukraine (Part II) - Putin's Press Conference, Annexation and Diplomatic Stalemate

March 4 - Putin's Press Conference

On March 4th, Russian President Vladimir Putin gave an extensive press conference from his country residence outside Moscow about the situation in Ukraine and the developments in Crimea. As examined in Part I, the democratic revolution-turned-coup in Kiev sparked an unexpectedly frightful reaction in Russian-speaking regions of Ukraine. The numbers on the streets on February 23 in Sevastopol could not be explained as a pre-planned Kremlin operation even by the most cynical of conspiracy theorists. 30-50,000 demonstrators out of a total population for the municipality of 380,000 could not be rallied to protest against their will within two days short of overwhelming pressure for which there was no evidence. Irrespective of activists subsequently moved in or the machinations, such as there were, around the secession referendum last weekend, these initial manifestations were largely genuine and there was no knowing exactly how Putin would enter the picture. Although this author was convinced that Crimean secession was in the cards almost from the outset, the pulse on the streets did not regard this as a foregone conclusion. 

When Putin appeared a week later for the press conference, his purpose was not to explain or foretell anything. Instead, the aim was to cement the reality on the ground and embed the inevitability of 1) Crimean secession and 2) Russia's long-term involvement (direct or indirect) in rump Ukraine's domestic affairs. By March 4th, Russian forces had secured all principal points on the peninsula, locals in Sevastopol and Simferopol installed new, pro-Russian authorities (Alexei Chalov as Mayor of Sevastopol having been unilaterally "chosen" by the February 23rd demonstrators) and Kiev had basically accepted it had no options to retake the peninsula as its local forces were confined to quarters. In short, there was nothing for Putin to update. Effectively, the press conference was meant as a demonstration of his having regained control of events and that Kiev, and its western backers, would now be reactive rather than proactive. 

Whereas February 21st seemed to deliver the Kremlin a major blow, the rebound was practically complete by March 4th. Just as Generals Kornilov and Denikin packed away to south Ukraine to raise a volunteer army to resist the Bolshevik takeover of Petrograd and Moscow in 1917 and early 1918, so too did the fulcrum of the anti-Kiev "resistance" emerge in Crimea. Proper metaphor or not, Crimea offered a clear path for Putin to exploit the vacuum left by Yanukovich's sudden departure and turn a seeming defeat into a tactical victory to reclaim the initiative. Had emotion not taken over on Maidan and the militant forces been muscled for even a few days, it is doubtful that events would have unfolded as they did.      

As with most everything related to Putin, the current situation in Russia and the trajectory the country has been headed since 1991, the western media narrative regarding his press conference was completely backwards. Instead of obtaining clues about Putins next steps, bemused readers were treated to articles like these. Apparently Putin was "paranoid", "cornered" and "delusional". Merkel, the only western leader Putin respected, had tried to talk sense into him and failed. The Obama Administration, NATO, Cameron and the EU commissioners were warning of serious consequences, sanctions and isolation if Putin did not send his forces to barracks, recognize the Kiev government and relent from further interference in Ukrainian affairs. Far from cornering Putin, this unhinged reaction by western leaders indicated that it was they who felt cornered. Putin had moved faster than they had anticipated, the Kiev government was chaotic and rejected by half the Ukrainian population and military intervention was never considered. The realization that Crimea was gone and nothing in the short-term could be done to shore up Kiev was apparent to everyone. The game of saving face had begun, which took more time away from what should have been sober diplomatic maneuvering.

Putin's press conference was significant for what it omitted rather than what it included. A precedent that immediately came to this author's mind was Joseph Stalin's speech to graduates of a military academy in 1935 where he declared that "cadres determine everything". Read between the lines and in the context of the purge to come two years later, this signaled that most of the audience was targeted for liquidation and would be replaced with new, neutered cadres loyal to Stalin. He pulled a similar maneuver during a meeting of the Central Committee in 1952 when he laid criticism on Molotov and Beria for various missteps and anti-party activities, which signaled to delegates that they were marked men. Putin's presser was laced with this type of multi-layered double-meaning. Framing any potential intervention in Crimea on humanitarian grounds against unleashed neo-nazis, nationalists and anti-semites and to "protect life", Putin signaled that any Russian intervention in Crimea (and Ukraine broadly) was legitimate whether or not anybody had asked or would ask for it. In other words, Russia had already intervened and would continue to intervene to prevent any permanent entrenchment of western interests and western-supported groups in Ukraine, and there was no need for any justification.  Putin then said that if the scheduled May elections in Ukraine would be carried out under a similar guise of "terror" as was on display in Kiev after the coup, then Russia would not recognize the result. In other words, irrespective of how the elections come out (presuming the current government, or possibly a more nationalist coalition, wins), Russia will not recognize the result and probably foment activity in the south and east to keep the new government at bay. So, as you can see, by negating Putin's affirmative statements and paying close attention to what was left out of his monologue, his strategy (pursued like clockwork over the past weeks) revealed itself during his tango with friendly reporters.

Crimea Annexation and Diplomatic Stalemate

The minutiae of the preparations for the Crimean referendum, its acceleration by a month and the predictable western reaction have by now been analyzed ad nauseum. The significant issue is not that a referendum took place, how it was conducted, how representative (if at all) the vote was or whether this will spill over into similar initiatives in Donetsk, Gorlovka or Kharkiv. The issue is that the Crimeans did not seek and Putin did not settle for the frozen conflict, South Ossetia route, but pushed ahead toward Crimea's formal accession. Why the different treatment for Georgia's regions when the situations are so similar (i.e., majority ethnic Russian communities, Russian passports spread around, thousands of Russian troops manning and building permanent defensive installations and a host country without the economic or military options to do anything). In Georgia, Putin was blessed with a president who made the first move. Kiev is too broke to have done the same. So why annex Crimea and do it so quickly?

The answer to the question of speed is easy as it flows from Putin's rapid engagement in Crimea in the first place: a vacuum does not remain unfilled for long. Had Putin waited another week, the EU may have unilaterally sent monitors to the peninsula or Kiev may have acted to shore up its minority, but resilient, support base. Putin understood that there is no one West just as there is no one East. Japan imposed minimal sanctions while China, seeing that it could not lose either way, largely tuned out and abstained from the symbolic UN Security Council vote on Crimea's future. The only western leader that has been paying attention is Merkel, and even she is under tremendous domestic pressure from German car and industrial manufacturers not to push Russia too far. She probably fears that Germany will be the primary source of Kiev's financial salvation, and having to deal with Russian energy cuts and business acrimony would turn a headache into a migraine. So Putin, resigned to ceding western Ukraine for the moment, boldly staked his countermeasure in Crimea and presented the West with a diplomatic fait accompli.    

This still, however, does not explain annexation. Here I believe it has as much to do with cutting the legs out from under Kiev and strengthening the hand of separatist factions in rump Ukraine as it does with playing toward the domestic audience. Putin's popularity has soared in the wake of the crisis, as admitted even by more independent polling agencies. As was discussed in "The Weimarization of Russia", the mantle of the gatherer of lost Russian territory is one worn by opportunistic Russian leaders with eagerness. Yeltsin went into Chechnya partly to shore up his collapsing approval ratings following the disbanding of the Supreme Soviet and continued economic chaos. Putin rose to power on his security credentials, and with Russian headlines declaring his reputation secured if he restored Crimea to the homeland, it may have been what pushed him to act. In this sense, Crimea is fundamentally more significant, culturally and historically, than either of Georgia's pseudo-statelets. The move could also have served as another signal to the West that Russia is willing and able to take the ultimate step in pursuit of its narrow interests without halfway measures. What is clear is that this will likely be a one-off performance, at least for the foreseeable future. If Putin's speech yesterday on Crimea's accession is any indication, Russia will most certainly not let Maidan Kiev fully control Ukrainian policy. Russia is watching and, if the West makes another bold move, is prepared to counter (see Putin's statement that the division of Ukraine is not in Russia's interest and, as always, read in reverse). 

Monday, March 17, 2014

Next Moves in Ukraine (Part I) - February 21, 2014 - Watershed

This first part of a two-part post examines the critical importance of February 21, 2014, and its immediate aftermath. This week, more than any other when the history of the unfolding developments in Ukraine becomes fully written, will probably be regarded as significant as the week in April 1917 when Lenin reappeared in Petrograd on a German-provided train to instigate the overthrow of the Kerensky government. 

As exit poll results give way to official numbers in the Crimea secession referendum, upwards of 95% of voters (with over 75% of ballots counted as of this writing) have thrown their fate with Russia. Simferopol and Sevastopol are awash with Russian flags and St. George ribbons. Soviet-era songs are playing from loudspeakers in homes and public squares. North of the peninsula, thousands rally in Donetsk and Kharkiv demanding a similar process in their districts. A crisis that began with a policy zigzag had claimed its second government as the drama continues.

                                          Maidan throws Official Opposition Overboard

February 21 was a turning point. Thousands lined Kiev's independence square that evening to hear (and make demands of) the leaders who brought them to victory over government forces. Western diplomats were probably too busy fine-tuning the compromise ostensibly reached with the Yanukovich government a day earlier to pay attention to the proceedings. The media was also largely plugged out of what was happening. Periodic snippets would appear on the wire services about this or that speaker, but nobody bothered to look into the specifics. But now, as Crimea settles into a diplomatic freeze and the West readies harsher sanctions against Moscow, it is worth revisiting what took place that fateful evening or, more precisely, whether everything that has happened up until now could have been directly foretold and acted upon based on what happened at the podiums then. 

To bring things into perspective, it is worth seeing February 21 as the day of "two speeches". Up until then, the West comforted itself with the belief that Maidan's street was fully behind the acceptable, official opposition personified by ex-boxing champion Vitality Klitschko. He was a known quantity and well-connected to established legislative forces which had battled Yanukovich for months. Extolling the crowd to not give in to government provocations and opt for unnecessary violence, Klitschko, flanked by Arseniy Petrovych Yatsenyuk and others who would form the core of the post-Yanukovich government, gave a rather bland speech about the deal worked out with the West over the previous 24-72 hours. To summarize the reaction his words received, think Mitch McConnell's faux Heston rifle pose at CPAC. Activists who had just come off pitched battles with Berkut that claimed over 100 lives and felt revolutionary fever akin to what deserting soldiers might have experienced in February 1917 did not want to be lectured about "provocations" and "negotiated compromises". The people wanted action and understood, as well as Klitschko, that he was losing control of the plot. The real power now lay elsewhere. 

This was likely the point that everyone in Washington and Brussels went to bed. Too bad they did not keep watching or skipped Klitschko's warm up act. Most intriguing was a speech made by one Dmytro Yarosh, head of something called Praviy Sektor (Right Sector), a group which, until February 21, noone in the West knew really anything about. Shedding business-ware for military fatigues, Yarosh gave a difficult to ignore display of force, flanked by fighters in full body armor. For those who do not understand Ukrainian in the linked video, Yarosh swore to continue fighting the "regime of internal occupation" and not give up his group's weapons until Yanukovich was removed from office. The crowd responded with loud roars and fist pumps.  Then came Volodymyr Parasiuk, who swept to the stage like a rock star with a clearly unamused Klitschko looking on and exclaimed that he, an unaffiliated activist with loyalties to no single organization, did not "believe in political processes or negotiations" and was giving the politicians an ultimatum — either Yanukovich is gone by 10 am the next morning or his fighters were going on the assault. December elections, unity governments and monitored restorations of unconstitutional authority were not on the table. Western. officialdom may have wanted Yanukovich removed and Russia weakened through a quiet transition, but the people with the guns (and the power) in Kiev had other ideas. There was no need for fiery demands, as Yanukovich fled Kiev by helicopter that night and left his estate and party offices to the care of his foes.

In the immediate aftermath of the seizure and its approval by a rump Rada, the West consoled itself with the front men the new government put forward to make what had happened the night before appear to be something it was not. Acceptable technocrats from the official right Fatherland party were given the presidency and prime ministerships, while behind the scenes, politely ignored by Western diplomats, Praviy Sektor and other anti-western ultranationalist factions staked out their claims. Yarosh and his group are eyeing the May presidential elections and next year's parliamentary elections to become leading drivers of Ukrainian politics. If Praviy Sektor's messaging is any indication, the official western line regarding a unified European-oriented Ukraine threatened by Russian neo-imperialism may have to be reevaluated. The group rails against "sellout, marginalized democracy" (video cuts to the Fatherland technocrats currently in office), EU expansion and collapse of traditional values. This would not be so depressing if only the western establishment were paying the slightest bit of attention to what is actually happening in Ukraine rather than the mirage, idealistic Ukraine manufactured by analysts in Washington and Brussels. It does not much matter at this point whether Yarosh and his group will or will not moderate or whether the technocrats (whose first order of business, at the behest of the nationalists, was to repeal a regional, Russian language law) will regain the support of the street. Revolution would now inevitably produce counter-revolution. Either noone had prepared for this or everyone knew, but chose to look the other way. Whatever the explanation, the cart had veered on the path that would lead to Crimean secession, Russian troops along Ukraine's eastern border and a nadir in relations among the great powers.

Crimea and the East Respond

Two days after Yanukovich's departure, on February 23, an estimated 20-40 thousand people poured onto the streets of Sevastopol in Crimea. This was not simply a political protest over policy gone wrong. Far from embracing Yanukovich, the crowd considered him a used-up has been (a "vegetable") who, at the moment of truth, failed to protect the nation from extremist forces. Repeatedly, some of the organizers shouted that, they begged Yanukovich to smash the "fascists" on the streets, but he played too close to the vest. Berkut fighters, reeling from their defeat in the capital, were welcomed on Crimea as heroes and those killed were honored in similar fashion as their Maidan opponents. The black ski mask fighters from Praviy Sektor were replaced by uniform-clad cossacks, who warned criminals of immediate death if they continued their activities while Sevastopol and Crimea remained in a "state of siege". The same rhetoric of occupation and armed resistance was on full display. Just as the fighters in Kiev warned the politicians of the consequences of their misbehavior, so did the Russians in Sevastopol form self-defense units and unilaterally elect their leaders over the heads of those then in power. In Kharkiv, when a Praviy Sektor detachment captured the regional administrative building and dug in, a crowd of over a thousand spontaneously stormed the facility and raised the Russian flag from the roof and windows. 

Events were moving at a pace that neither side could fully understand or control, but it was apparent weeks ago that what was once a fragile, but still somewhat unified country had been profoundly torn asunder. To speak of the "destiny of Ukraine being determined by the people of Ukraine" after February 21 was intellectually disingenuous. There was no longer one Ukraine whose destiny could be determined. Maidan had yielded a government unacceptable to half the population with power brokers probably unacceptable by many within the anti-Yanukovich camp itself.  

As will be analyzed in Part II of this post, how Moscow and the western powers reacted to what had happened in Ukraine during the pivotal week at the end of February would determine whether everyone lived in the real world or preferred the indulgence of fantasy. Would the West come to terms with the fact that February 21 profoundly changed the rules of the game and make a fully unified, EU-oriented Ukraine impossible? How would Moscow fill the vacuum and how far would it go? Was reconciliation between the East and West possible or were such considerations no longer relevant? In other words, would the West achieve an incomplete victory and expend capital to marginalize hostile forces to its values within a Kiev government thrust upon it or would it pretend as if nothing had gone wrong and continue along its preset course?