Tag Archives: Crimea

Russia Needs the EU’s Help, Not Its Sanctions

East and West

The West reacted sharply against Russia over the downing of the Malaysian Boeing. That is justified: Even if investigators conclude that separatists in Donetsk are not to blame, Russia helped create a situation in which such a thing is even possible in southern and eastern Ukraine. However, threatening and isolating Russia is unlikely to improve the problem. Like a teenager exhibiting aggressive behavior, Russia needs the help of a very patient and high-minded adult — that is, if any exist.

One of my Ukrainian colleagues who supported the Maidan from the beginning and who was outraged by Russia’s actions in the Crimea and the south and east of his country, once sent me a heartfelt note reading: “No one cares what internal issues Russia is going through. They should sort out their problems themselves.”

I understand his feelings. I am one of those few Russians who believe that this country’s behavior toward Ukraine in recent months has been completely unacceptable, that it has destroyed whatever international authority Russia once held and has irreparably undermined the credibility of Russian leaders in the eyes of the international community. Indeed, it has led people to stop trying to understand what is happening in this country. Now the world has almost officially concluded that Russians are monsters.

This loss of interest in Russia could be even worse for ordinary Russians than new economic sanctions, or even the tumult that will inevitably result in a society whose imperial ambitions have been thwarted.

But the most frightening possible result of sanctions is that the West could nail shut the “window to Europe” that Russia has been laboring hard to develop ever since Peter the Great first built it at tremendous cost in the early 18th century.

Way back in 2006, a book called “The Day of the Oprichniki” came out, authored by modern Russian writer Vladimir Sorokin. Through some mystical and visionary inspiration, Sorokin created what could serve as a “road map” for today’s Russian leaders.

The book describes a Russia walled off from the West, in which almost everyone speaks Chinese and where the populace happily reproduces some tawdry idea of the political, social and cultural life of Russia prior to Peter the Great.

Of course, it is a monarchy re-established and ruled by a certain Tsar Nikolai Platanovich, an allusion to former Federal Security Service director and current Security Council secretary Nikolai Patrushev. While watching a public flogging in a central Moscow square, subjects of the heirs to Platonovich recall with pleasure how they made bonfires to burn banned books and how they themselves burned their travel passports on Red Square as a demonstration of loyalty.

In the year the book was released it seemed like just a bit of outlandish fun, although it had a large print run in part because the pro-Kremlin youth group Nashi staged a public book burning of Sorokin’s allegedly “immoral” works. Just the same, nobody imagined that the phantasmagoric situation Sorokin described might become reality only a few years later. Now it seems that Russia is racing at full speed toward the world of Sorokin’s oprichniki.

Russia’s isolation from the West could make that world a reality. Many Russians have a passion for reviving the past as is seen, for example, by the way in which Russian historical re-enactors are fighting in the south and east of Ukraine. They represent a tiny fraction of the overall population, just a handful of marginal figures who dream of restoring Russia’s lost imperial power and who have been waiting for their chance ever since the Soviet Union collapsed.

They and their war are such that, after shooting down a foreign passenger plane while hunting for what they believed was a permissible military target, their first thought was to say that the plane was carrying spies, a deluded attempt to make the tragedy fit into their homemade myth.

And then they hurriedly erased all mention of the episode from social networks. It might very well turn out that they are the killers, and if so, they should be punished. But either way, they will not stop being little boys with the mentality of the late Soviet period, boys who were born to rule the Soviet empire but who arrived on the scene just in time to see it collapse. They are boys who haven’t yet stopped playing their historical re-enactment game.

Of course, theirs is a deviant world view. It is impossible to condone their actions in any way, especially now that their games have turned into a bloody mess. But only people who genuinely lack concern for what is happening inside Russia can label them as the vanguard of the “evil empire,” as almost all of the world’s newspapers wrote on the morning after the Boeing disaster.

Here in Russia, there is no “evil empire,” just a huge and doubly bitter disappointment.

It stems first from the collapse of the Soviet Union, a government which, despite all the crimes of the Bolshevik leadership, enabled several generations of Soviet citizens to feel that they were participating in a grand social and humanitarian project. And second, it results from the fact that, after the Soviet collapse, Europe and the U.S. did not admit Russia into their clubby relationship.

But the majority of Russians do not dream of joining the separatists’ ranks. In fact, the several hundred or even thousands of Russians who really are there to fight for their strange ideas are, unfortunately, almost everyone in this vast country that is even capable of taking some form of political action.

That explains why the separatist militias increasingly include individuals who took part in the mass protests on Bolotnaya Ploshchad in 2011, people generally considered to be more liberals than imperialists or nationalists. As for the overwhelming majority of Russia’s more than 100 million people, they could not care less and have no plans to go anywhere at all.

Western newspapers probably have some intellectual justification for rhetorically equating the words “Russia” and “killers.” And even if the separatists’ guilt in the tragedy is never conclusively proven, a certain logical connection becomes evident. After all, the Russian leadership did its fair share to make such an accident possible and the Russian people chose these leaders. The people must ultimately answer for their officials’ actions, even if they themselves do not really care about what happens in Ukraine.

Unfortunately, very few people in Russia today are prepared to see or understand that connection. As a result, the blame from the West will only offend them, increase tensions and bring “The Day of the Oprichniki” even closer to realization.

In order to clarify this connection, a high-minded adult is needed, someone who will not pressure this already hysterical youth but instead will make an effort to truly understand what is happening inside him, to find a way to reach him, and finally, to speak to him as an equal, without fear but also without arrogance.

Then it just might become clear that the West also carries some blame for the current crisis in Ukraine because, frankly, it never was interested in what was troubling Russia.

Ivan Sukhov is a journalist who has covered conflicts in Russia and the CIS for the past 15 years.

The Moscow Times.

The European Union’s wake-up call seems to be falling on deaf ears

Time to wake up Europe...
Russia’s military Feb. 27 military invasion and subsequent annexation of Ukraine’s Crimean peninsula was supposed to be the European Union’s wake-up call to answer Vladimir Putin’s aggression.

So was Russia’s war against Ukraine in the eastern oblasts of Donetsk and Luhansk. But not only has the EU failed to formulate a strong response, many of its members want to continue selling arms and doing business as usual with Russia. Now after Russian separatist leaders armed, trained and financed by the Kremlin are believed to have shot down Malaysia Airlines Flight MH17 on July 17, killing 298 people, the EU appears to still be sleeping in response to Russia’s threat to global peace.

#Economy: Russian execs fear lasting damage from plane crash

FILE - In this Monday, July 21, 2014 pool file photo Russian President Vladimir Putin listens during a meeting in Samara, Russia. Having for months dismissed Western sanctions on Russia as toothless, business leaders here are now afraid that the crash of the Malaysian jetliner will bring about an international isolation that will cause serious and lasting economic damage. The U.S. and EU are still playing something similar to “good cop, bad cop” with Russia, said Chris Weafer of the Moscow-based Macro-Advisory, but it remains to be seen whether the Malaysian plane crash will be a game changer for Russia’s economy. (AP Photo/RIA-Novosti, Alexei Nikolsky, Presidential Press Service, File)FILE – In this Monday, July 21, 2014 pool file photo Russian President Vladimir Putin listens during a meeting in Samara, Russia. Having for months dismissed Western sanctions on Russia as toothless, business leaders here are now afraid that the crash of the Malaysian jetliner will bring about an international isolation that will cause serious and lasting economic damage. The U.S. and EU are still playing something similar to “good cop, bad cop” with Russia, said Chris Weafer of the Moscow-based Macro-Advisory, but it remains to be seen whether the Malaysian plane crash will be a game changer for Russia’s economy. (AP Photo/RIA-Novosti, Alexei Nikolsky, Presidential Press Service, File)

MOSCOW (AP) — Having for months dismissed Western sanctions on Russia as toothless, business leaders here are now afraid that the crash of the Malaysian jetliner will bring about an international isolation that will cause serious and lasting economic damage.

Throughout the Ukrainian crisis, U.S. and European sanctions had mainly targeted a handful of individuals, sparing economic ties. Then last week the U.S. imposed penalties on some of Russia’s largest corporations. And when the airliner was shot down just a day later in Ukraine, allegedly by separatists with Moscow’s support, concern grew in Russia that the sanctions would only get worse as President Vladimir Putin showed little sign of cooperation.

“Over the past few months, there was a sense that Mr. Putin acted decisively, forcefully, and correctly, and that everybody else in the world would accommodate themselves to that reality and we’d get back to something like business as usual,” said Bernard Sucher, a Moscow-based entrepreneur and board member of Aton, an independent investment bank. “Now we’re talking about real fear.”

When Russia annexed Crimea in March, triggering a deep freeze in relations with the West, stock markets in Russia dropped but later rebounded as investors understood that the country’s lucrative trade relations would remain largely unscathed. Europe, which is in frail economic health, dared not block energy imports from Russia or the trade in goods such as cars or heavy machinery. Oil companies like BP and ExxonMobil continued their operations in Russia, with some even signing new deals.

The U.S. took a tougher stance, but until last week was also careful to limit sanctions to asset freezes on individuals who were perceived to have had a hand in supporting eastern Ukraine’s insurgency.

On July 16, the night before the Malaysia Airlines jet crash, Russian markets appeared to have fully recovered from the crisis in Ukraine, with the MICEX benchmark index adding roughly 23 percent since March 1.

Then last week, the U.S. announced new sanctions that had investors in Russia fear a turn for the worst. The U.S. shut off its financial markets for a broad swath of defense companies as well as Russia’s largest oil company, Rosneft, gas producer Novatek, which is half-owned by a close Putin ally, and a major bank, VEB. The move offered investors a glimpse of what they had thought would never happen: serious international isolation of Russia’s powerhouse corporations.

According to Alexis Rodzianko, president of the American Chamber of Commerce in Russia, those sanctions were the first to really pack a punch because they were “broader and more specific: they went beyond the symbolic.”

Rodzianko said anecdotal evidence suggests that in some cases investment decisions have been delayed “particularly when people were just considering coming in to the market.”

When the Malaysian airliner went down one day later, investors worried conditions would only get worse.

The stock market has fallen 5 percent since Thursday last week. That is expected to see investors keep pulling money out of the country. They withdrew $74.6 billion in the first six months of the year, a figure forecast to reach $100 billion for the whole of 2014 — almost twice the $60 billion in withdrawals seen last year. Continue reading

Russia may ask rich to help foot bill for Crimea with ‘solidarity tax’

People enjoy the sun by the seaside on a beach some 40 km of the Crimean capital Simferopol, on June 29, 2014.  © AFPPeople enjoy the sun by the seaside on a beach some 40 km of the Crimean capital Simferopol, on June 29, 2014. © AFP

(Reuters) – Russia could ask its richest citizens to help foot the bill for the annexation of Crimea by paying a “solidarity tax” proposed by a group of lawmakers.

Deputies from the State Duma lower house of parliament, which is dominated by backers of President Vladimir Putin, have drawn up a draft law that would increase income tax for people earning more than more than 1 million roubles ($28,700) a month.

It would affect less than 2 percent of the working population but the amounts could be huge for some individuals because the draft proposes they pay up to 30 percent of their earnings compared to the current flat rate of 13 percent.

“The main goal is to support regional budgets and that means also the budget of Russia’s new territories,” Andrei Krutov, the deputy leading the planned legislation, told Reuters.

His reference to the “new territories” made clear that a key intention was to help the government pay for Crimea’s absorption into Russia.

The Black Sea peninsula was annexed in March, an action seen by most Russians as righting what they considered a historical wrong by late Soviet leader Nikita Khrushchev who gifted Crimea to Ukraine in 1954, long before the Soviet Union collapsed.

The need to help support Crimea’s economy and its 2.3 million population has put a new strain on Russia’s federal budget at a time when the country is sliding towards recession.

Some state employees say they have already been asked to donate a day’s pay to help Crimea – a demand some have balked at.

The Finance Ministry has also suggested personal income tax may have to be increased by 1-2 percent to help cover the costs and the government had already heard calls for Russia to introduce a progressive taxation mechanism.

Krutov said the draft law could be a step in that direction and played down the impact on society.

“The social burden would be minimal and the influx of cash to the budget would be significant,” Krutov said. “The economic reality and international experience increasingly show that progressive taxation is a step that Russia needs to make in the near future.”

He said the draft could go to a vote in the autumn and, if approved, could bring in 300 billion to 500 billion roubles ($8.6 billion to $14.30 billion) a year.

The small group of Russia’s rich accounts for more than a third of total personal income in the country, according to data from Federal Tax Service.

Criticism of the proposal has so far been muted – critics would risk sounding unpatriotic and uncharitable as the annexation of Crimea is widely supported and has boosted Putin’s ratings.

But an instant online poll by Snob magazine, which is aimed at the wealthy, showed 66 percent of respondents did not support the idea of a solidarity tax.


NY Daily News: The games Putin plays #MH17

“The country that denied invading Crimea now says it had nothing to do with the downing of the Malaysian jet” – Michael Weiss

Russian President Vladimir Putin

Evidence that Kremlin-backed separatists in east Ukraine downed Malaysia Airlines Flight MH17 is now so overwhelming as to rule out any other culprit, at least outside the imaginations of conspiracy theorists or professional Kremlin propagandists.

For months, Russian President Vladimir Putin has waged maskirovka warfare in east Ukraine – an old, Soviet-perfected model of destabilizing foreign countries which is characterized by dissimulation, misdirection and plausible deniability, all done with the use of arms-length proxies.

Putin, a former KGB lieutenant colonel, continues to maintain that he has nothing to do with the separatists even as their political leadership has lately visited Moscow begging for more materiel and even opened a satellite office there to coordinate their activities more closely with their master and patron. It also pays to remember that Putin denied invading and annexing Crimea – until he didn’t.

U.S. officials, including one from the Defense Department, have confirmed to the Wall Street Journal that the separatists – many of whom are in fact Russian nationals – downed the commercial airliner over the skies of the separatist-controlled region of Donetsk on July 17 using the Buk anti-aircraft missile system. This is a Soviet-era, vehicle-mounted munition with a range of 46,000 feet. The MH17 was blown apart at an altitude of 33,000 feet.

The separatists, who have previously claimed credit for shooting down Ukrainian military planes and helicopters, said they haven’t got the capability to hit an aircraft at the MH17’s altitude. Except that they admitted, albeit privately and inadvertently, that they’d done just that.

The Ukrainian Security Service, or SBU, has leaked a series of what it alleges are intercepted phone conversations from the separatist camp. In one, recorded in the aftermath of the tragedy, a separatist commander named Igor Bezler (or “Bes,” meaning “Demon”) tells Colonel Vasyl Geranin, a man whom the SBU says is an officer of Russia’s military intelligence agency, or GRU: “Just now a plane was hit and destroyed by the Minera Group,” referring to a rebel unit.

A week ago, Bezler admitted in a recorded “press conference” held in Donetsk that separatists had received tanks and armored vehicles from Russia for the purpose of defending Slavyansk, a city that recently was retaken by Ukraine’s military.

Western intelligence officials have told the Financial Times that they have judged the SBU intercepts to be genuine.

Defense experts say that there is no way ragtag insurgents could operate a surface-to-air missile as sophisticated as the Buk. But the rebels are not quite ragtag insurgents.

Their self-proclaimed military commander is a man named Col. Igor Strelkov (also known as Girkin). According to the European Union, which sanctioned him in April, Strelkov is also an officer of the GRU. This means that the entire anti-Kiev insurgency is not just pro-Russian in orientation but overseen and led by an outed Russian spy.

This is a crucial fact that has been obscured in much of the recent media coverage of the war for east Ukraine and just who’s involved in waging it. Samantha Power, the U.S. ambassador to the United Nations, said yesterday: “Russia can end this war.” What she meant was, the separatists are a wholly owned, if not quite wholly operated, subsidiary of the Russian government.  Continue reading