2014-03-18 By Harald Malmgren
In March, world attention turned to fast moving events in Ukraine which set in motion a direct clash between Russia, on one side, and the EU and US, on the other. Viewed as an unexpected, but isolated event in the Ukraine, press and media focused primarily on whether or not Russia would use military force, and whether or not the breakoff of Crimea from Ukraine and application of Crimean Parliament for annexation to the Russian Federation could be reversed.
President Obama declared that the US would “never” recognize the referendum for independence of Crimea as legitimate. (US Presidents rarely ever state that something would “never” happen, as it would imply all future Presidents would be bound by the current President’s decision.)
EU leaders made strong condemnations of President Putin’s bullying tactics, including his evident threat of military force, and declared that the Crimea attempt to exit Ukraine was illegitimate and contrary to the integrity of a sovereign state.
When President Obama and some European leaders decided that costs should be imposed on Russia to alter Putin’s calculations, press attention shifted to what kind of penalties or sanctions the US and Europe might impose, and whether such penalties could be effective.
US and European leaders soon found themselves caught in domestic political resistance to harsh confrontation with Russia.
American and European business and banks had become deeply entangled not only in the Ukraine economy but, more important, in the Russian economy. If a confrontation with Russia were to impose serious damage on the Russian economy, concern was expressed that Russia in turn would impose damage on Western businesses and banks.
Weighing the pros and cons, European leaders recognized that Europe was far more vulnerable to Russian reprisals than the US might be.
Russia had become the key energy supplier for Germany and the West European grid, and was capable of imposing significant pain through manipulation of supply and pricing. Export dependent Germany also faced the reality that its primary growth focus in recent years had shifted from North America and recessionary EU towards expansion eastwards to Russia, China, and the rest of Asia. Exposure of European banks to Ukraine and Russia was huge, at a time when European financial institutions were still under stress and in transition to some new form of Europe-wide oversight. Europe essentially found that it was unwilling to put its banks in the path of Russian tanks.
The US and European conclusion was to impose limited sanctions which were focused on specific individuals and interest groups in Russia and the Ukraine, in an effort to alter Russian calculations.
However, it became evident that pains imposed on Putin’s aides and supporters did not alter Putin’s own decisions.
WE and European leaders found themselves at an impasse, unable to alter the loss of Crimea to Russia, or reduce the threat of further fragmentation of the predominantly Russian-speaking Eastern Ukraine population.
The March 2014 political and media obsession with the Ukraine and Crimea distracted attention from the historic consequences of such a clash between Russia and the West.
From Putin’s perspective, the collapse of the USSR was an historic catastrophe for Russia. The gradual encroachment of Western Europe, NATO, and even the US into Eastern Europe through such means as membership in NATO, in the EU, or cooperation in military training and defense continued to aggravate Russia’s sense of catastrophe.
Moscow’s efforts to limit fragmentation of Yugoslavia and protect the integrity of Serbia had previously been swept aside by American diplomacy. It was only in 2008 that the Russian incursion into Georgia marked a point of reversal. Russia’s modest success in Georgia may have helped the writing of Putin’s new playbook for what was formerly the Soviet space, or Russia’s “near abroad”.
The great global financial crisis, which unfolded after the Lehman collapse no doubt pushed Putin’s historic ambitions aside while Russia, dealt with the global recession and prolonged debt market storm. Nonetheless, there was continuing discussion in Moscow of the need to “protect” fellow Russians and their Russian-speaking progeny in the neighboring areas. The idea of providing Russian passports to people of Russian origin was given periodic consideration in the Kremlin.
Areas of concentration of Russian diaspora were scrutinized for potential political exploitation among the Baltics and the other nations in proximity, among them especially the Ukraine. The deal to keep a strategic military presence in Crimea, especially the port of Sebastopol, was always perceived in Moscow as an essential segment of Russia’s long-term military strength.
The same thinking lay behind Russia’s determination to keep its naval base in Syria, although other motivations were also in play in support of continuation of Assad’s control.
For example, the Gulf kingdoms desired to build a gas pipeline from the Gulf to Western Europe through Syria, but Russia did not want to yield its vital gas grip on Ukraine, Germany and other nations in Europe. Keeping Assad in power and Gulf interests absorbed in conflict was important for Russia’s energy power, as well as for Russia’s exploitation of relations with Iran.
Most likely the recent Syria “red line” drawn by President Obama revealed a new opening for Putin’s complex, strategic focus on a need to reshape the power structure between Russia and the West.
When President Obama hesitated to carry out his threatened “calibrated” punishment of Syria for breach of the red line, Putin leaped to the opportunity to take a leadership position in a role of easing the risk of conflict and clearing away Assad’s holdings of chemical weapons.
For Obama, the Putin initiative was felt to be a tactical victory for both him and Putin, with hope for a new, pragmatic relationship. For Putin, the reluctance, hesitation, and political division of views in Washington revealed a strategic opportunity for reversing the deterioration of Russian influence in its neighborhood.
Putin’s efforts to manipulate Ukraine’s relations with Europe and Russia through Yanukovych as puppet seemed to be moving in Russia’s favor until the uprisings of indigenous Ukrainians not only overturned the Ukraine government but overturned Putin’s strategy for reclamation of hegemony over Ukraine.
Determined to rescue his ambition for restoration of Russian power in the near abroad, and avoid loss of domination of Crimea, Putin initiated a clever “quasi-military” intervention combined with large scale movements of military forces in nearby Russia to intimidate Ukraine’s new leadership as well as the US and Europe.
Protecting fellow Russians evolved into Russian diaspora self-determination through an overwhelming referendum, followed by a declaration of the new Crimean Parliament of desire to become part of the Russian Federation. Putin declared Russian recognition of the new “independent” republic of Crimea, and waited a little to see if the US and Europe would take definitive new steps to prevent absorption of Crimea into Russia.
The Western response of sanctions did worry some of the key players in Russia and Russian quadrant of Ukraine, but Putin evidently concluded he was finally on a new path, with a new template;
Exploit fragmentation of the nations in the former Soviet space, encouraging devolution of central power to local governments in each country, leaving national capitals ill-positioned to engage with the West economically or strategically, and gaining political influence through the Russian diaspora in each East European nation.
A small-scale experiment with this stratagem has been exploitation of continuing tensions between Russian-speaking Eastern Estonia, close to St. Petersburg, and the central government of Estonia in Tallinn. Putin’s original home was in St. Petersburg, so he was personally familiar with that terrain and clear separation of the Russian-dominated Narva environment from the rest of Estonia. Where to place the national border had been a continuing issue, but more recently it was refined into shift from the Russian side to the Estonian side of the river which was the primary water source of the region, leaving Estonia in a scramble for alternative water supply.
Western press, media, and diplomatic discussion of Putin’s latest, seemingly erratic moves, failed to recognize the larger design of incremental steps to fragment and weaken neighboring central governments in favor of decentralization, and closer engagement of Russians with Russians.
Estonians in particular have long been wary of this potential incremental strengthening of Russia’s grip westwards. Latvia, with a much larger Russian presence in and around Riga, is especially sensitive. Lithuania, more dependent on Russian gas and being a corridor for Russian access to Kaliningrad, also sees itself vulnerable to Putin’s incremental ambitions.
A fragmentation-decentralization process has not been openly exploited until now, but Putin’s tactics with regard to Crimea make sense in a context of a longer-range stratagem for gradual regaining of political influence in the near abroad.
In the long-run, this may take the form of a patient, incremental, but relentless effort to “Finlandize” the vast area between Russia and the West.
China surprised some Western officials when it supported Russia’s arguments about legitimacy of Crimean self-determination, and opposed the use of Western sanctions against Russia.
However, it was most likely recognized in Beijing that Putin’s successful initiative to reconfigure the boundaries of his neighborhood could potentially be exploited in the same way in the South and East China Sea, gradually moving China’s military reach into close proximity with Taiwan while denying US the same degree of proximity. The ADIZ initiative was clearly designed to narrow the scope of maneuver of US and other forces in that geographic area.
Having watched US hesitation and indecisive, tentative responses to Putin, there should be little doubt that China’s PLA apparent itchiness to have armed conflict with one or more of its neighbors may soon be scratched.
Limited, but violent engagement with Philippines, Vietnam, or even Japan is increasingly likely.
Moreover, as the Chinese economy slides into a period of financial market turbulence and slowdown, it may become necessary to offset domestic economic discomfort with a surge of nationalist sentiment against perceived foreign “threats”. In such a context, it would not be surprising to have a limited conflict take place between PLA and Japanese SDF ships or aircraft. It should also not be surprising if China simply forcefully were to establish control over the Spratlys, Senkakus, and other disputed islands in the China Sea.
In this bigger perspective, the Crimean independence event likely signals an inflection point in Russia’s relations with the West, and may signal an opening for an inflection point in China’s relations not only with its neighbors but with Taiwan and ultimately with the US.
Washington thinking has primarily been focused on the immediate tactics of responding to Putin. The idea that terminating Russia’s role in the G8 and reestablishing the G7 would hurt Putin’s feelings seems farfetched in this context. Washington’s declared intention to “isolate” Russia and hurt its standing in global power circles also seems flawed, especially since Putin probably thinks he has finally found means for altering Russia’s position from a center of centrifugal forces to a core of centripetal forces.
From the perspective of Russia’s place in the world economy, Putin’s ambitions will likely be blunted by forces of globalization of markets, including resumed turbulence as the US, Europe and China all pass through an historic period of financial restructuring and economic stabilization.
Russia’s economy is highly vulnerable to external demand for its resources and the fundamental, inherited weakness of its economy. The concept of the new BRIC powers was always a flawed idea. Russia is no more a great economic power than Brazil or India.
As for China, it may be entering a period of being humbled by domestic economic failures as its export engine inevitably falters. An internal power struggle may be the consequence of unanticipated financial or economic management failures.
Command economies are inevitably vulnerable to highly concentrated negative economic and political surprises.