Ukraine Crisis: The Continual Nature of Economic Warfare

If NATO is drawn militarily into the conflict then it is nearly assured that it will not come to a peaceful standstill any time soon.

Russia continues its military buildup on the border with Ukraine. In addition there have been reports that Russia has sought to strengthen its position in the Crimea with nuclear weapons. Russian nuclear bomber incursions into Finnish, Swedish, and near US airspace have also become a consistent phenomenon in recent weeks.

Vladimir Putin has also made it clear that the separatists in the east of the country will not be allowed to fall to the government forces which have continually forced them further and further towards the Russian border, which bristles ever more each day with Federation tanks and howitzers.

Because of this it is prudent to consider why precisely things seem to not be moving towards a tangible, meaningful peace in Ukraine. The answer lies in the economics of the region and the interplay between the influences of the EU and Russia with respect to capital and mobilization within the country.

Simply put: Both NATO and Russia possess the resources to defend Ukraine militarily from each others influence and are driven to do so by latent economic factors which (like in the case of the human body swelling to encase and expel a foreign splinter of wood) have been relatively opposed to Ukrainian autonomy.

It should also be noted, however, that while NATO and Russia are equipped to fight by proxy for an indefinite span of time, a direct conflict would bring things to a head much faster on the international stage.

I. The State of Things

As was mentioned above, the situation in Ukraine is far from peaceful. Furthermore, mounting evidence suggests that Russian forces are present within the country and that they are constantly growing in strength of arms and numbers. Andriy Lysenko, a spokesman for the Ukrainian military stated of this that “Russian mercenaries are strengthening and reinforcing (rebel) forces near the front line.”

There is also a “significant likelihood of an intensification of fighting between Ukrainian and Russian and separatist forces in the next six months prior to the ‘freezing’ of the conflict,” reports Maplecroft, a global risk analytics firm.

Ukraine has recently stopped all funding to banks and state office operations in the Luhansk and Donetsk regions due to rebel activity (which the Kiev government still generally defines as “terrorist” activity). As the situation continues to develop it is highly likely that government control will slowly erode away in the east, only deepening and prolonging what has already amounted to a drawn out conflict.

This has necessarily led to some awkwardness on the international stage. At the APEC summit in Beijing, for instance, “Putin has talked to President Obama several times. They talked briefly, yet touched on the issues of bilateral relations, Ukraine, Syria and Iran,” stated Dmitri Peskov, spokesman for Russian President Vladimir Putin

Tensions between the United States and Russia have seen an upsurge in the last year. Economic sanctions imposed by the EU as well as Russian suspension from the G-8 over the situation in Ukraine and specifically the Crimea last March served, in large part, as the beginning of this process.

The latest G-20 Summit in Brisbane featured multi-lateral efforts by western powers to hinder Russian progress in its slow-burning aggression against Ukraine. US President Barack Obama, Australian Prime Minister Tony Abbott , and Japanese Prime Minister Shinzo Abe joined forces to protest what is seen by many as a series of escalatory actions on the part of Vladimir Putin that began with the annexation of Crimea. Prime minister of Canada, Stephen Harper, even made the comment to President Putin, “I guess I’ll shake your hand but I have only one thing to say to you: You need to get out of Ukraine.”

President of the EU, Herman Van Rompuy stated of the precarious situation regarding Russian incursion into Ukraine, “We will continue to use all diplomatic tools, including sanctions, at our disposal.” Poroshenko also made a statement, making it known that “If events begin to unravel in spite of the peace plan, Ukrainian armed forces today are ready and capable of repelling (an offensive).” 

A so-called “frozen conflict” constitutes a theoretical concept within the bounds of geo-politics wherein an armed insurgency has declared its independence from an existing political entity and has participated in armed conflict with said political entity until a cease fire has been reached.

What characterizes the situation of the frozen conflict however, is an obvious lack of any semblance of  progressive, political negotiation between sides and the situation on a macro scale assumes the clouded character of a grey area. Regions of the world which are representative of this phenomenon include the Korean peninsula, Transnistria, Georgia, and, most recently, the former Ukrainian territory of Crimea.

Supplies of gas have been guaranteed, at least through the winter, in a deal between Russia and Ukraine. This continuing relationship does obviously not bode well for Ukrainian sovereignty in the long term. This is, of course, barring a major entrance by EU powers on the essential resources front, which seems unlikely in the short term.

German Chancellor Angela Merkel also all but ruled out another set of economic sanctions against Russia. Notwithstanding the pending possibility of token efforts at placing European travel restrictions on pro-Russian politicians elected to represent the new Crimean government, not much else can be done in the short term.

“Beyond that,” Merkel stressed, “further economic sanctions are not planned at the moment; we are focusing on the winter and the humanitarian situation there and how to get a real cease-fire,”

II. Conclusions

Ukraine represents an opportunity for the west. This opportunity consists in a manipulation of the current economic, military, political situation within the borders of Ukraine. Furthermore, NATO powers have already been given significant pretext for an escalation of efforts at molding the situation.

It is clear that Vladimir Putin does not have quite the wide variety of options. Indeed it may appear as if he has metaphorically “backed himself into a corner” over the past few months. Progressives must understand that at its root the Ukraine crisis stems from a very real economy which operates underneath the surface of the modern eastern European system.

Four things can be safely concluded:

1) Ukraine is currently not, and will most likely never be (at least in its current form) capable of sustaining itself economically, independent from close participation with one of the two major economic blocs in Europe.

2) As it follows from 1, while the Ukrainian military is capable of holding its own against disparate and inconsistent rebel groups, this ability will experience a dramatic decrease as Russia provides more and more aid and applies pressure.

3) If NATO is drawn militarily into the conflict then it is nearly assured that it will not come to a peaceful standstill any time soon.

4) Even if a split peace were reached between the two divergent sides, it almost necessarily follows that neither interested party would be satisfied and, thus, a return to warfare would assume a constantly bubbling state just beneath the surface.