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The Russians Are Coming?

In Europe, as Lucas explains, Gazprom has used its leverage to purchase large equity stakes in national energy companies such as ENI in Italy, BASF in Germany, and Gaz de France, which, of course, amplify its already disproportionate influence.

So what is to be done? Russia’s August invasion of Georgia proper appears to have been provoked by the Georgian government’s attack in South Ossetia. But Russia’s subsequent penetration into areas well beyond the trouble zones of South Ossetia and Abkhazia suggests that the new nationalists in the Kremlin are willing to resort to drastic measures to assert their perceived national interest—even if that comes at the cost of a sharp rise in tensions with the countries of the West. Indeed, Russia’s apparent willingness to project its sense of grievance into its foreign policy makes it a dangerous and potentially destabilizing rival.2 This is not just a matter of academic concern. Europe’s energy security, and to some extent its political independence, are at stake. (Lucas notes, for example, that in relying on Gazprom, the EU is dealing with a company that not only is run by the Kremlin but also is, because of its involvement in state-run press and television, “directly linked to the end of press freedom in Russia.”)

There is also the question of the broader political and economic future of the countries like Georgia, Ukraine, and Belarus that lie along the fault line between the European Union and Russia. Georgia will continue to be at issue —not only because of its two separatist republics whose independence has now been officially recognized by Moscow, but also because it is a key point of exit to world markets for energy from the Central Asian republics.3

But the real flashpoint—the fulcrum of Eurasia’s destiny, as the recent natural gas crisis reminds us—is Ukraine, a big and unstable country that has always been a focus of geopolitical competition. A large chunk of Russia’s navy, the Black Sea Fleet, is still based in Crimea, and many Russians continue to regard Ukraine in much the same way that Serbs see Kosovo—as a heartland of their own national culture. At the same time, although more than 20 percent of the Ukrainian population are ethnic Russians, a large and apparently growing number of Ukrainians increasingly link their own national identity and historical destiny with Europe rather than their neighbor to the east. Just for good measure, lately even the “pro-democratic camp” in Kiev has been riven by the long-running feud between President Viktor Yushchenko and Prime Minister Yulia Tymoshenko, who recently traveled to Moscow for a round of surprisingly convivial negotiations with Putin. The potential for conflict should be apparent.

Lucas has some useful ideas to offer:

The regulators of the world’s financial centers must rethink how they deal with Russian (and for that matter Chinese) companies wanting to use them. The free market cannot be decoupled from the free society. The industrialized world has shown its capacity for collective action in dealing with money laundering. It could do the same for corporate governance and property rights. That would mean, for example, that any company wanting to list its shares or sell its bonds in London, New York, or Frankfurt would have to make it clear that it was engaged in a real business, not the collection of artificial rents; that its property was not stolen; and that its ownership was clear and truly private. Gazprom and [the Russian oil company] Rosneft, along with most big Russian companies, would be immediately disqualified.

Implementing such a high standard may be hard at a time of international economic turmoil. But such restrictions can be framed as positive incentives that will—by allowing greater integration of the Russian economy into Western markets and systems of regulation—contribute to economic stability back in Russia. Lucas would like to see a concerted effort to fight money laundering, including tougher action against the Western front companies that are used by Moscow’s oligarchs to sanitize corrupt profits. He would also like to see a crackdown on Russian spying in Europe and the US, which, as many security experts agree, has, in fact, reached levels comparable to the bad old days of the Soviet Union.

Measures to enforce stricter financial standards in Western marketplaces do not need to target Russia. They could be embedded in broader codes of conduct applying to the sovereign wealth funds—owned by China or various Middle Eastern companies, for example—that have become such powerful actors in international commerce in recent years. Indeed, though Lucas mentions China glancingly in this context, it would have been interesting to see him expound on this point at greater length.

Lucas also insists that Russia should only be allowed to maintain its membership in international organizations if it actually follows their rules. For example, Russia was welcomed into the European Union’s human rights forum, the Parliamentary Assembly of the Council of Europe, in 1996, at a moment when Russia aspired, more or less, to democratic standards. Now that Russia has chosen a different path—and, moreover, insists that its new one is more to its liking—Lucas writes that its membership “looks a catastrophic mistake” and should be suspended. Like John McCain during the US presidential campaign, Lucas also questions the rationale for Russia remaining a member of the Group of Eight, the club of leading industrial democracies:

Either [the G-8] should become a big-economies club (in which case China, India and Brazil should join), or it is a body for rich countries that respect the rule of law and political freedom. In that case Russia does not even belong in the waiting room.

The G-8’s function is largely symbolic to begin with, and I’m not sure what purpose Russia’s exclusion would ultimately serve, but he certainly has a point about the need to redefine the group.

Interestingly, Lucas eschews sanctions, rightly pointing out that they have usually proven ineffective, “create wonderful opportunities for corruption,” and contribute to isolationism. He’s also refreshingly skeptical about supporting “democracy assistance” programs inside Russia, arguing that, under current conditions, they will be taken by many Russians as evidence of continued Western interference. What he insists upon very strongly is that Europe must make every effort it can to reduce its dependency on Russian energy supplies by creating a Europe-wide energy market with diversified sources of supply. (Right now that market is divided up into fragmented national grids that all too often end up operating at cross-purposes.)

Somewhat confusingly, given his clear preference for market solutions, Lucas argues at the same time that European countries should cooperate in developing pipelines that would connect their market with Central Asian suppliers such as Turkmenistan and Kazakhstan while bypassing Russian intermediaries4 —even if investors are unwilling to shoulder all the risk themselves. In this case, he says, pipeline policy is a matter of national security—and “national security is a job for politicians, not those in business.” Indeed, while many economists might argue that the experience of East Asia in particular demonstrates that successful capitalism doesn’t necessarily have to coincide with liberal democracy, Lucas turns the argument on its head:

If you believe that capitalism is a system in which money matters more than freedom, you are doomed when people who don’t believe in freedom attack using money.

Markets, he argues, should be subordinated to freedom, not the other way around. This is actually something of an intellectual leap, and it will be interesting to see how such ideas develop as the liberal democracies continue to be challenged by authoritarian capitalism—particularly in the aftermath of the current financial crisis.

Perhaps most controversially, Lucas believes that offering NATO membership to Georgia and Ukraine is a key component of any strategy for constraining Russian designs on its neighbors. Opponents of the previous enlargement of NATO—including, of course, many Russians—say that expanding membership to members of the former Warsaw Pact was an insult to Russian sensitivities and a threat to Russian security. What this argument ignores is that NATO enlargement had a positive influence in knitting together a region that might otherwise have fallen into chaos. Contrary to popular belief, NATO enlargement was driven less by a grasping, hegemonic United States than by the desire of Washington’s European allies to stabilize the belt of newborn democracies to the east. There is no question that they have succeeded in this aim.

Just as the opportunity to join the EU compelled many countries in the region to undertake difficult political and economic reforms, NATO’s requirement that candidate countries resolve border conflicts with their neighbors before they can be admitted forced would-be members to confront and air old historical grievances that could have easily poisoned the region’s future. In the early 1990s, for example, Hungarian nationalist leader Jozsef Antall described himself as the “Prime Minister of 15 million Hungarians”—that is, including five million ethnic Hungarians in Slovakia, Romania, and Serbia—and vowed to defend them against alleged discrimination there. Italy and Slovenia, Lithuania and Poland, and Germany and the Czech Republic all had to confront long-running historical disputes with one another. The security benefits of NATO membership provided a powerful incentive to defuse these controversies. NATO also forced aspirant countries to consolidate civilian control over their militaries.

This success, now widely acknowledged, could not have been achieved without a firm political will to reconciliation among all the sides concerned. In the case of both Georgia and Ukraine, by contrast, there are few signs that such conditions can be fulfilled anytime soon. Russia may have done an effective job of exploiting and aggravating these divisions, but the dispute between ethnic Georgians and the ethnic minorities concentrated in Abkhazia and South Ossetia has a long and rocky history that is now, if anything, much farther away from being satisfactorily resolved than it was before Tbilisi attacked the South Ossetians this past August—thereby offering the Russians a perfect excuse for intervention.5 Unless Georgia can make progress on these issues, allowing it to join the alliance would represent a betrayal of NATO’s own principles.

The situation with Ukraine is, if anything, more complicated. Were a pro-Western government in Kiev to vote on NATO accession, political turmoil would immediately ensue. The eastern part of the country—dominated by Russia and with a large proportion of Russians—would almost certainly respond with mass protests, possibly culminating in violent opposition to the central government or demands for secession. The consequences in the Crimea—where, as rumor has it, Moscow has been issuing Russian passports to local sympathizers just as it has done in Abkhazia and South Ossetia—would probably be even more explosive. The attempt would probably rebound to devastating effect on NATO itself, which would almost certainly find itself deeply divided over how to respond.6

In truth, not many of the European members of NATO are particularly enthusiastic about the prospect of admitting Georgia and Ukraine to the group —even if Russia’s actions in Georgia pushed many hitherto hesitant countries (most notably Germany) into publicly endorsing the possibility of membership down the road. It is problems like this that Lucas has in mind when he insists, throughout his book, that the West must be united if it is to formulate anything like a serious response to the rising Russian threat.

The reality is that there has never been less of a sense of common cause between Europe and the United States since the end of World War II than there is today. These are not good times for Atlanticists, and the reasons run much deeper than European dissatisfaction with the policies of the Bush administration. Since the late 1980s and the collapse of the Soviet empire, historical circumstances have pushed the United States into a quasi-imperial position at a time when Europe’s consolidation has given it a renewed sense of its own economic power and “post-national” destiny. It was Madeleine Albright, not Donald Rumsfeld or Condoleezza Rice, who referred to the US as the “indispensable nation,” and though President-elect Obama has emphasized the need to pay more attention to the wishes of our allies and the broader international community, there is little to suggest that he disputes the fundamental premise of a leading role for the US. Of course, this view of America’s dominance seems particularly ironic at a time when more and more countries around the world have adopted their own versions of market economics and democratic institutions—meaning that America, in that sense, has become more dispensable than it was when the cold war, the real, bipolar, Manichaean cold war, divided the world fairly neatly into friends and foes.

This is one reason why talk of a “New Cold War” ultimately misses the mark. The other is that Russia, contrary to all the feverish talk about its presumed status as a revived superpower, is nothing of the kind. It is a rising regional power that enjoys the benefit of immense geographical reach and huge natural resources. Yes, it has a nuclear arsenal and a big army—but, as Lucas correctly notes, the former is outdated and poorly maintained, and the latter, as its less-than-stellar performance against Georgia’s tiny army demonstrated, is still a long way away from a state-of-the-art modern force.7

Meanwhile, the financial crisis has dramatically highlighted the anemic basis of Russia’s supposedly formidable economy. The impending recession, and a corresponding fall in commodity prices, had been depressing Russian markets even before August. Since then, as a result of its attack on Georgia, Russia’s international image has deteriorated sharply, and investors both domestic and foreign have bolted. As a result, the past few months have seen Russia’s stock markets lose up to 75 percent of their value; Moscow’s once feverish stock exchanges had to be shut down repeatedly to stanch the panic.

Meanwhile, the country’s extraordinary demographic decline—aggravated by a nationwide drug and alcohol epidemic, a catastrophically underfunded health system, and the rapid spread of AIDS—continues seemingly unchecked.8 On this count, the supposedly benevolent despots in today’s Kremlin have done little to improve on the dismal record of Boris Yeltsin. An insecure Russia, of course, is no good for anyone—least of all Russians. There seems little that the outside world can do to help. Russia is undoubtedly capable of acting as a positive force in its region. But only Russia itself can decide whether it wishes to play such a role.

One good start, though, might be to exercise a bit more caution in how we employ historical analogies. In reality we are not entering a “New Cold War” or anything like it. What we are facing is the messy challenge of figuring out where a big, ailing, mournfully post-imperial Russia fits into the chaotic twenty-first century. That can’t be done by giving Russia a pass when it comes to obeying the basic rules of international discourse. Treating Russia like an eternal enemy—one that deserves only isolation and quarantine—probably won’t be very effective, either. Finding the way between these two paths must be tried, and it won’t be easy.

January 14, 2009

Letters

The Russians Are Coming?’ April 30, 2009

  1. 2

    President Medvedev placed the language of national honor at the center of his remarks on the Georgian crisis, as quoted in Andrew E. Kramer’s report, “Russia Seems to Be Hunkering Down in Georgia,” The New York Times, August 18, 2008:

    Obviously, if anyone thinks he can kill our citizens, our soldiers and officers who are serving as peacekeepers, and go unpunished, we will never allow this. Anyone who tries this will receive a devastating response. For this, we have all the means—economic and political and military…. We do not want to aggravate the situation, but we want to be respected, and our government to be respected, and our people to be respected, and our values.

    Russia’s willingness to protect its citizens is understandable enough, but it’s rather hard to see how this need was answered by sending Russian forces deep into Georgian territory, occupying Georgian ports, and destroying civilian as well as military infrastructure.

  2. 3

    The Baku–Tbilisi oil pipeline, running from the Caspian Sea to the Mediterranean via Azerbaijan, Georgia, and Turkey, was completed in 2005 after three years of construction. It was built by a British Petroleum–led consortium as a way of circumventing the Russian hold on energy transport networks in the region. Denting investor confidence in the pipeline—which has proven more successful in commercial terms than its founders might have hoped—was apparently one of the aims of the Russian incursion into Georgia proper.

  3. 4

    Lucas is particularly insistent that the EU should support the Nabucco Pipeline project, which is supposed to link Austria with the eastern Turkish border town of Erzurum. Many Europeans have so far balked at the projected cost of around $6 billion, but, ironically, the fears stirred up by Russia’s actions in Georgia have now given the project a new lease on life.

  4. 5

    The Georgians have persistently claimed that they began shelling Tskhinvali only in response to provocations from the Russian side, but the available evidence calls this account into question. Most recently several monitors from the Organization for Security and Cooperation in Europe have gone on the record to state that they detected no signs of an attack by the Russians or their allies prior to the start of the Georgian bombardment. See “Accounts Undercut Claims By Georgia on Russia War,” by C.J. Chivers and Ellen Barry, The New York Times, November 7, 2008. See also “Civilians in the Line of Fire: The Georgia–Russia Conflict,” Amnesty International, 2008.

  5. 6

    That said, the European Union and the US should do everything they can to provide a broad range of aid and political support to both Georgia and Ukraine—as they say they intend to do.

  6. 7

    Some military analysts gave the Russian military good marks for its performance, noting that its troops operated much more efficiently than, say, during its dismal efforts in Chechnya in the 1990s. Still, this is a notably low baseline, and the fact remains that in August, Russia somehow managed to lose six planes to the ill-equipped Georgian air defense system. Some have objected that recent US programs for training and equipping the Georgian army should have enabled it to put up a better fight than it did. What this ignores is that the Americans were preparing the Georgians primarily for counterinsurgency and peacekeeping operations. No one in the Pentagon or the State Department would have ever expected Georgia to be able to fight, much less win, a war against Russia—which is the main reason why the Americans (and even some Eastern European governments friendly to Tbilisi) repeatedly and insistently warned Mikheil Saakashvili and his administration to avoid provoking the Kremlin.

  7. 8

    See Murray Feshbach, “Behind the Bluster, Russia Is Collapsing,” The Washington Post, October 5, 2008.

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