What really happened in Ukraine   24 Apr 2014

I went to Ukraine for dental treatment last year and saved enough on the treatment to pay for several weeks visiting both Western Ukraine and the Russian speaking part. I made friends with people from both parts, or should I say, both 'sides' as Ukraine has been fractured into two opposing sides, the Ukrainian speakers in the West and the Russian speakers in the East. These represent the significant differences in the histories of the West and East sides of Ukraine.

I have walked through and around Kiev's Maidan Square, landed in and waited hours in Crimea's Simferopol airport, looked down on Russia's Navy fleet from my apartment in Sevastopol, and spent time in two Ukrainian speaking cities, Nikolaev and Rivne.

I've walked down leafy Primorsky Boulevard in Odessa and down the Potemkin steps to the grandiose Odessa hotel. The hotel was built on the pier in the flush of enthusiasm after Ukraine gained independence from Russia in 1991 and is now abandoned, a perfect metaphor for the gross mismanagement of the Ukraine economy over the last 20 years as politicians [many of them oligarchs] took the wealth of a country, rich in fertile farmland and minerals, for themselves and did not update any infrastructure except for the 2012 World Cup.

Odessa, which was founded and developed by men from Naples and Paris and populated with East European Jews to provide Catherine the Great with a strong connection to Europe, is now Russian speaking and erecting a statue to Stalin.

Kiev is considered the birthplace of Russia but is more aligned with the Western part of Ukraine which was part of Poland and Austria until given to the Soviet Union in the Treaty of Versailles to punish the Austrians for starting WW1. The Eastern 1/3rd of Ukraine plus Crimea have always been Russian speaking with a Russia culture and an economy integrated with Russia.

In the 1930's Stalin, desperately needing food for his Russian supporters after the failures in production caused by his collectivization of Russian agriculture, took all the food from Western Ukraine to Russia leaving 6-7 million Western Ukrainians to die of starvation. He did the same thing for the same reason after WW2 leaving 2-3 million to starve to death. These are very strong reasons why Western Ukrainians, remembering their ties to Western European culture, resent and even hate the Russians.

Eastern Ukraine did not suffer the same fate. They were taken care of because they had the mines, metals and minerals that Russia needed as well as the factories to process them.

The United States, and to a lesser degree the European Union, has been agitating in Ukraine since 1994. In 1994 the UK, US, Russia and Ukraine signed a treaty guaranteeing the physical boundaries of Ukraine. Putin broke that treaty when he invaded Crimea a few weeks ago.

Ukraine did not want to give back to Russia the nuclear missiles they inherited when they broke with Russia in 1991 because they feared Russian aggression. Russia didn't trust the Ukrainians. So the US and UK brokered the treaty whereby the US and Russia would destroy the weapons and reprocess the nuclear fuel for power stations in exchange for the treaty protecting Ukraine's borders from Russian aggression.

But Clinton, Bush and Obama undermined the treaty from the beginning by funding and training political parties in opposition to the various presidents hand picked by Yeltsin and Putin. Those opposition parties put more and more pressure on the Ukraine governments to develop strong trade ties with the EU and were almost successful with the trade treaty, supported by many of Ukraine's oligarchs because they wanted to trade with the EU, that Ukraine President Yanukovich was due to sign in late November.

Putin was also undermining the treaty from about 2000 when the Russian secret service began funding and training the underground groups who would eventually start the agitation for secession of Crimea and Eastern Ukraine. The head of one of these groups is now the appointed Chairman of Crimea.

At the same time Putin was using Russian media, Russian money and the Russian secret service to prop up his protege Yanukovich as well as to create governments in waiting for Crimea and Eastern Ukraine.

So we had very deep historical animosities, underhanded actions from both Western governments and Russia striving to protect its borders with the buffers of Ukraine and Belarus, especially after Bush put stupidly put missiles in Poland. We also had a broken economy in Ukraine that disadvantaged most Ukrainians and a quite pronounced cultural divide. An ideal setup for trouble.

Keep in mind that the major strategic goal of Russia since the Churchill/Roosevelt/Stalin conference in Tehran in 1943 was to have a buffer between Russia and Europe. They achieved that when Roosevelt gave them all of Eastern Europe at Potsdam in 1945. But Russia lost all of it except Ukraine and Belarus in 1990-91. The invitations to Ukraine, Georgia and Armenia to sign trade agreements with the EU and to join NATO created a major threat to Russia. This was made worse when Bush put guided missiles in Poland.

I fail to see how the west could have been so incredibly stupid as to threaten Russia with NATO troops and arms on its very doorstep. It shows they cared not a whit for the Ukrainian people who became the meat in the sandwich and guaranteed more hardships.

Now observe carefully the timeline of the breakdown.

1. Putin puts trades restrictions on Ukraine's exports to Russia and raises gas prices pre October/November to force Ukraine to not sign the trade agreement with the EU.

2. Putin calls Yanukovich to Moscow. On his return Yanukovich rejects signing the EU agreement.

3. Yanukovich allows Maidan protests to continue and foreign fools like Senator McCain come to Kiev to inflame the crowd.

4. Putin calls Yanukovich to Moscow. On his return Yanukovich institutes repressive laws similar to what Putin put in place after his last presidential election. In exchange Putin agrees buy $15 billion of Ukraine bonds, about 1/4 of what Putin spent on the Olympics. Putin is no fool - he would have known the repressive laws would inflame the protesters. But Yanukovich had no choice - without the repressive laws Putin wanted, Ukraine would have to pay more for gas and wouldn't get the loans that they desperately needed.

5. Yanukovich tries to compromise with the opposition and removes repressive laws. Putin stops loans and renews trade barriers.

6. Putin calls Yanukovich to Sochi. On his return Berkut Interior Police snipers are ordered to assassinate protesters and some police. Again, Putin would know this would inflame the protesters and lead to the government being pushed out. Yanukovich flees Kiev.

7. Putin offers Russian passports to all Russian speakers in Ukraine. Russian parliament and upper house vote to allow Putin to invade all Ukraine - not just Crimea as reported in the media.

8. Putin labels Ukraine government as illegal, which it is because the constitutional requirements for replacing a president were not quite met. However, the Ukraine constitution does not contain a response for the situation where a president abandons his post and flees the country. Putin labels the Ukraine government fascist, which is only partly true as fascists only control about 20% of parliamentary seats and only three of twelve seats in cabinet. Putin says the Russians in Ukraine must be saved from the
fascists and invades Crimea having created the perfect excuse by instigating the breakdown of the Ukraine government.

9. Putin sends soldiers into Ukraine proper to seize control of a major gas distribution plant.

10. Coming up- Putin will have to seize control of all the gas and oil pipelines going from Ukraine to Crimea as well as the water supplies from Ukraine that Crimea depends on. These all go through the very Ukrainian city of Kherson. Watch for this in the news.

Putin is holding military exercises along the Eastern Ukraine border and in Transdiniestria, a Russian enclave in Moldova on the Southern Ukrainian border. Russian soldiers without insignia on their uniforms join protest groups to take over government buildings in major Eastern Ukrainian towns included Kharkiv, Lugansk and Donetsk. Russian officers take control of police forces in those towns after threatening any police who do not join them with execution.

Fitting these pieces together it is hard to make any argument other than Putin having organised the downfall of the government to create an excuse for invading Crimea and then parts of Eastern Ukraine to get control of at least some oil and gas passing through Ukraine and to guarantee Eastern Ukraine as a buffer zone.

Political observers now debate whether the riots in Eastern Ukraine are to give Putin an excuse to invade Eastern Ukraine to 'save' the Russian speakers from the 'fascists' in Kiev or whether he will sit back, let the new President, who will be elected on 25 May, accept Western aid which will come with the typical IMF requirements of selling government assets to Western interests and lowering wages and social spending thereby driving the majority of the population, who will be hurt by these requirements, to ask Russia to 'save' them.

But Russia is also in recession and its economic growth has faltered. The only thing going for it economically is its oil and gas exports. Crimea will cost Russia $5-6 billion a year, more if they do not take control of the oil, gas and water that all comes from Ukraine. The Russian finance minister has asked Putin to reduce military spending and feed more cash into the economy. Putin refused. Holding on to Ukraine, even if only Eastern Ukraine, will cost Russia a small fortune.

What has this to do with us? The US and EU have placed ineffective sanctions on some senior Russia officials but not on Putin and his inner circle. This will have no effect.

The neo-cons in the US, as well, I suspect, as the defense companies, are putting pressure on Obama to escalate the tensions. He can only do so by starting a financial war with Russia as a military war in Ukraine would be impossible for the West to win.

Obama could start a financial war by closing down all banking and currency lines. He can't restrict Russian oil and gas exports as that would hurt Europe's people and industry although Putin expects this and is signing an agreement next week to pipe oil and gas to China. Obama could, though, release the US strategic oil reserves, which are at a decent level, and drive oil prices down to $30-40. This would have a dramatically negative effect on the Russian economy as oil and gas exports account for 50% of government revenue and a major part of GDP.

How would Russia respond? Russia, China, Brazil and India have been discussing for years forming an alternative world trade currency to the US dollar. China has been building up massive gold reserves so they can launch the Renmimbi as a major trading currency. Therefore Russia and China could join together and do all their trade to the US and the rest of the world in a combined Ruble/Renmimbi [Real & Rupee & gold?] currency. This would drive the value of the US dollar down and immediately push the Western world into depression.

Recently, Russia staged an attack at a checkpoint in eastern Ukraine which was quickly filmed for television and sent ‘round the world. Putin has used the attack to claim that Kiev has broken the recent agreement between the US, EU, Russia and Ukraine.

Once Putin has acquired Eastern Ukraine will he bite off chunks of Latvia, Lithuania and Estonia?

Amazing how poorly Western politicians have performed compared to the brilliance of Putin. How silly and ignorant it seems that the West spent billions creating opposition to the Russian-backed Kiev governments without any plan of how they would deal with the blow-up when it came.

If Putin were playing chess with all the US and EU leaders at the same time, he would mate them all in a dozen moves.

© Charles Drace 2014

ENDS

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