Russian scam meets armed finance: prepare for deterrence failure

Vladimir Putin, the “Tsar of Brinkmanship“, intensifies the pressure on Ukraine and its NATO supporters on a scale far beyond the events of 2014, much like Nikita Khrushchev used to squeeze West Berlin. In recent months, Russia has massed a deployment of joint forces significantly more efficient and exceeding 100,000 men, five to ten times the size of the combat battalions available in 2014-2015. Moscow signals that it will not abandon Ukraine without a fight. In a high profile november speech To senior Foreign Ministry officials, Putin warned that although NATO continues to ignore Russia’s “red lines” in failing to bring its “military infrastructure” “to our borders”, the “tension” created by Russian collapse policy is now producing “some effect.” Putin said “it is necessary that this state persists for them as long as possible” until they back down and provide Russia with long-term security guarantees.

At the right time, the Foreign Office handed over to the Biden administration last week and posted on their website Moscow’s sweeping demands, which include the rescinding of a 2008 pledge to Ukraine and Georgia that they would one day join NATO, a ban on any further deployment of weapons and forces in Eastern Europe and the negotiation of a new treaty on European security. While NATO’s commitment to these former Soviet republics was a strategic blunder that depended on Russia never reclaiming the power and the will to challenge it, the United States and its allies can never back down. such pressure. Even as the talks begin to seek a mutually acceptable deal, Russian military timeline conducting offensive operations against Ukraine is shorter than any plausible space for diplomacy, showing that the Kremlin is preparing to go to the wall.

For Putin, like Khrushchev, a competition in risk-taking seems to offer a tempting opportunity to simultaneously solve several international and domestic challenges, forcing others to compromise in unwanted tests of will. Putin is clearly unhappy with Ukrainian President Volodymyr Zelensky’s refusal to propose pro-Moscow policies, the failure of the Minsk process to revive Russian influence in Ukraine, and the growing military role of the United States and others. Western countries in and around Ukraine, despite its non-NATO status. For the Kremlin, Ukraine has also become the linchpin to redress Russia’s lost structural power in European security. There is no later point in Putin’s thought; it is now or all will be lost forever.

The Ukrainian crisis resembles Khrushchev’s confrontation with a West German leadership supported by economic recovery, increasingly serious in its nuclear ambitions, and eager for reunification on Western terms. Khrushchev also faced challenges to his authority in his country and elsewhere in the communist world. Putin, likewise, appears to fear that a Western-rooted Ukraine will eventually become a prosperous democratic country and lead the Russians to challenge their own capitalist system of stagnant cronyism. Like Khrushchev, Putin also played his national legitimacy, in part, on makeshift geopolitical setbacks, first in Crimea, and now by undoing terms of European security. For the West, leaving Ukraine in limbo was as much a mistake as leaving West Berlin as an indefensible outpost.

The Kremlin’s determination to halt the advance of Euro-Atlantic institutions was signaled in a more modest campaign against Georgia in 2008 before Russia decided to fracture Ukraine and seize Crimea. Even though Western policymakers expected Russia’s agreements with transatlantic institutions like the 1997 NATO-Russia Founding Act to promote stability, Moscow was never able to permanently accept a lowercase “limited relationship“With the expanding Euro-Atlantic institutions of NATO and the EU which dominated the continent and was controlled by other powerful players, not Russia. Putin sternly repeated this week his 2014 warning that “we have reached a point beyond which we cannot back down.”

The trend line of closer military, political and economic associations between Kiev and Washington and other Western countries, even in the absence of an action plan for NATO membership, is the last straw. ‘water. The Kremlin is concerned that the United States, in particular, is creating facts on the ground, in the air and in the seas that make America’s stakes in this region appear to rival those of Russia. This would represent a major departure from President Barack Obama opposite conclusion that “Ukraine is going to be vulnerable to Russian military dominance no matter what we do, ”because Russia has higher stakes there. Obama explained that “we need to be very clear about what our core interests are and what we are prepared to go to war for”, although “there will always be some ambiguity.” This time around, with US domestic politics marked by Russia’s gray zone influence operations and the ongoing war in Ukraine, Washington feels more committed to Ukraine and wants to scare Putin into himself. making it seem like his approach to the brink will boomerang, but this result is far from certain. The Biden administration talks about the arms brooch flowing to Ukraine, but there is no indication that Americans will fight to defend Ukraine’s sovereignty as a sister democracy, despite insurance supplied to Kiev in 1994 in exchange for abandoning the nuclear arsenal he had inherited during the collapse of the USSR.

Like Thomas Schelling Explain, absurdity “is the tactic of deliberately letting the situation get somewhat out of hand, simply because it may be intolerable for the other party and force their accommodation.” Schelling would describe the dynamic Putin imposed on Ukraine as the “rationality of irrationality”: Putin deliberately generated risk and “exploited the danger that one might inadvertently come to the brink, dragging the other with him. “.

Moscow hopes to demonstrate not that he has greater overall power than the United States and Ukraine’s other Western partners, but that he is more willing to to commit the power needed to achieve its goals. Although the Kremlin prefers to avoid a protracted and costly war, it signals a willingness to fight for Deny Ukraine has complete autonomy in its international policies and Deny The West of Kiev joins forces with a new transatlantic bridgehead on Russia’s western border.

A casus belli can always be found, and a one-on-one fight involving Russia against Ukraine is unlikely to go well for Kiev on the battlefield; even Ukrainian generals fear to be “outmoded. “

In March 2015, a year after the annexation of Crimea, Putin signaled on a television broadcast that he was ready to raise the alert level of Russian nuclear forces to ensure that the West does not intervene. Even without factoring in Putin’s nuclear rattle, Russia has plausible horizontal escalation options both to deter direct Western intervention and to retaliate against Western economic sanctions. Moscow would likely consider a proportionate escalation to include cyber attacks against critical civilian infrastructure or against the US financial sector.

Economic and financial swords are bad instruments of coercion

Not wanting to engage US forces, the Biden administration resuscitated Obama’s deterrence plan, but under changed conditions. Washington is probably mistaken that threats of financial sanctions will deter Russian military escalation. Coercion through punishment, including punishments, rarely succeeds. The International Monetary Fund estimated in 2019 that the sanctions had curb Russian growth by 0.2 percentage point between 2014 and 2018, but Russia is unlikely to ever voluntarily abandon Crimea. Washington has also threatened more extreme sanctions, such as disabling Russia’s access to the SWIFT financial messaging system, targeting sovereign debt issuance and the full range of derivatives, and hitting Russian banks. The transatlantic community is also warning that Russia’s Nord Stream 2 gas pipeline to Germany could be closed.

The problem is, current policymakers are overstating the impact such threats had in deterring Putin from extending the war against Ukraine in 2014-15. The Kremlin then assimilated new information about the lack of enthusiasm of Eastern Ukrainians to fight alongside the Russian-backed separatists in favor of the restoration of Novorossiya. Further concerns have been expressed about the likelihood of popular Russian opposition in the event of high losses. Today, Putin is still not free from constraints at the national level, but the impact of higher levels of repression and censorship should not be ignored. US policies that hurt the Russian economy would also likely generate perverse results, such as allowing the regime to blame the economic slowdown on the West and perhaps encourage Putin to go further to the right and incorporate extremist nationalists into his regime. ruling coalition.

World leaders have historically faced such geoeconomic questions. Prussian leader Otto von Bismarck believed that the lack of capital would not make Russia more peaceful. Bismarck was only partially exaggerating when he asserted that the Russians “spend the necessary money for railways and wars whether they have it or not. Throughout its history, Russia’s most notable liberal finance ministers, from Mikhail von Reutern (under Alexander II) to Alexei Kudrin (under Putin) have fought the nexus of interests driving protectionist, military expansion. industrial and imperial, winning a few political struggles while generally losing the long game.

Putin fits the model of the Russian rulers who prioritized military industry and domination of resources over rational economic development. This pattern is embedded in Putin’s autocratic personalist system and Moscow’s attachment to the role of an ambitious great power. Like Joseph Stalin, Putin is convinced that the weak are beaten, not only on the battlefield but in all areas of competition between the great powers. Additionally, Russia’s defense sector, like other dominant parts of the economy, is largely owned and run by regime insiders and not easily constrained by sanctions. So, it’s surprising why the former director of the US Treasury Department’s Office of Foreign Assets Control still says the US should sanction the Russian oligarchs to “put more and more pressure on a regime to change its behavior by eliminating the people who support it”.

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