#2
www.rt.com
June 7, 2015
'Russia would attack NATO only in mad person's dream' - Putin

Russia is not building up its offensive military capabilities overseas and is only responding to security threats caused by US and NATO military expansion on its borders, Russian President Vladimir Putin told Italian outlet Il Corriere della Sera.

Speaking to the paper on the eve of his visit to Italy, Putin stressed that one should not take the ongoing "Russian aggression" scaremongering in the West seriously, as a global military conflict is unimaginable in the modern world.

"I think that only an insane person and only in a dream can imagine that Russia would suddenly attack NATO. I think some countries are simply taking advantage of people's fears with regard to Russia. They just want to play the role of front-line countries that should receive some supplementary military, economic, financial or some other aid," Putin said.

Certain countries could be deliberately nurturing such fears, he added, saying that hypothetically the US could need an external threat to maintain its leadership in the Atlantic community. "Iran is clearly not very scary or big enough" for this, Putin noted with irony.

Russia's President invited the journalists to compare the global military presence of Russia and the US/NATO, as well as their military spending levels. He also urged them to look at the steps each side has taken in connection with the Anti-Ballistic Missile Treaty since the collapse of the Soviet Union.

Russia's military policy is "not global, offensive, or aggressive," Putin stressed, adding that Russia has "virtually no bases abroad," and the few that do exist are remnants of its Soviet past.

He explained that there were small contingents of Russian armed forces in Tajikistan on the border with Afghanistan, mainly due to the high terrorist threat in the area. There is an airbase in Kyrgyzstan, which was opened at request of the Kyrgyz authorities to deal with a terrorist threat there. Russia also has a military unit in Armenia, which was set up to help maintain stability in the region, not to counter any outside threat.

In fact, Russia has been working towards downsizing its global military presence, while the US has been doing the exact opposite. "We have dismantled our bases in various regions of the world, including Cuba, Vietnam, and so on," the president stressed. "I invite you to publish a world map in your newspaper and to mark all the US military bases on it. You will see the difference."

Meanwhile, it would take only 17 minutes for missiles launched from US submarines on permanent alert off Norway's coast to reach Moscow, Putin said, noting that this fact is somehow not labeled as "aggression" in the media. The US has carried out the oft-cited strategic bomber flights along Russia's borders since Soviet times without interruption, while Russia stopped them in the early 1990s and has only resumed them just recently.

The combined military spending of NATO countries is ten times higher than that of the Russian Federation, Putin stressed.

America has been setting up "anti-missile systems, bases and radars located in the European territory or in the sea," despite Russia's repeated warnings that this undermines international security.

Revealingly, it is the United States that chose to withdraw from the ABM treaty limiting anti-ballistic missile arsenals, which Putin believes was "the cornerstone of the entire international security system." The Russian leader questioned the move: "Did someone expect Russia to disarm unilaterally?"

He explained that Moscow had tried to dissuade the US from withdrawing from the treaty, and instead "create an ABM system together, the three of us: Russia, the United States and Europe." This proposal was declined, and Russia had to, likewise, begin developing "overpowering anti-ballistic defense" systems to ensure strategic balance. According to Putin, Russia has made "significant strides in this area."

"Everything we do is just a response to the threats emerging against us. Besides, what we do is limited in scope and scale, but is, however, sufficient to ensure Russia's security," Putin underlined.

Nevertheless, Putin said he views America not as Russia's rival, but rather as a partner and ally on many pressing world issues, such as global terrorism, Middle Eastern crises and Iran's nuclear program.

"We are not just partners; I would say we are allies in addressing the issues related to non-proliferation of weapons of mass destruction. We are undoubtedly allies in the fight against terrorism. There are some other areas of collaboration as well. The central theme of Expo Milano...is yet another example of our joint work," Putin said.

Expo Milano 2015 is an international gathering in Milan, Italy, which this year has been promoted under the slogan "Feeding the Planet, Energy for Life," and which Putin will also be visiting. Russia is taking part in the event, presenting its own technologies and innovations.

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 #3
International Business Times
www.ibt.com
June 6, 2015
Vladimir Putin Urges Donetsk And Luhansk To Remain Part Of Ukraine
By Christopher Harress

Russian President Vladimir Putin is pushing a proposal that would see the self-proclaimed republics of Luhansk and Donetsk remain under Ukrainian control. Leaders in the disputed regions have said they might be open to the idea provided conditions of the failing ceasefire are met by Ukraine.

"This is a fundamental issue. I think this position should be viewed as a sound precondition for the start of substantial negotiations," said Putin, according to a transcript of the interview published by Italian newspaper Corriere della Sera and released by the Kremlin.

While EU and NATO officials suspect the Russian military is helping the rebels in their fight against Ukrainian troops in East Ukraine, Putin has resisted calls to annex both regions as he did with Crimea in March 2014. The cost of rebuilding the region and assimilating the millions of civilians living there, it is thought, is the reason it will not happen. In addition, Russia's economy has suffered badly since EU-led sanctions were put in place against it last year.

Europe would also like to see the sanctions lifted as Russia is considered one of its biggest trade partners, but that can only happen if Russia withdraws its troops and weaponry from Ukraine, and meets the full conditions of the Minsk II agreement that was signed in February. Putin has also expressed a desire to normalize ties between Europe and Russia, as well as seeing an end to fighting in the region.

"The key aspect of the political settlement was to create conditions for this joint work, but it was essential to stop the hostilities, to pull back heavy weaponry. On the whole, this has been done. Unfortunately, there is still shooting occasionally and there are casualties, but there are no large-scale hostilities. The sides have been separated. It is time to begin implementing the Minsk agreements," he said.

However, the group charged with overseeing the conflict, the Organization for Security and Cooperation in Europe, said earlier this week it witnessed some of the most intense fighting since the ceasefire agreement was signed. The Ukrainian military reported 14 soldiers were killed and dozens injured in battles near the de facto rebel capital of Donetsk.

Fighting continued Saturday with the Ukrainian military reporting increased use of Grad rockets, which are supposed to be banned under the ceasefire agreement.

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#4
Moscow Times
June 8, 2015
Putin: 'We Have Never Viewed Europe as a Mistress'
By Gabrielle Tétrault-Farber

President Vladimir Putin insisted that the West should not view Russia as a threat in an interview published Saturday in Italian newspaper Corriere della Sera ahead of an official visit to Italy that kicks off this week.

"I think that only an insane person - and only in a dream - can imagine that Russia would suddenly attack NATO," Putin said, according to a transcript of the interview released by the Kremlin. "I think some countries are simply taking advantage of people's fears with regard to Russia. They just want to play the role of front-line countries that should receive some supplementary military, economic, financial or some other aid."

The outbreak of the Ukrainian crisis and Russia's annexation of Crimea last March have sparked fears in a number of European states, including the former Soviet republics of Estonia, Latvia and Lithuania, that Russia could undermine their territorial sovereignty. The regular interception of Russian military ships and aircraft in the Baltic region has only exacerbated these apprehensions.

Putin also dismissed the notion that Russia had played a role in the deterioration of its relations with the EU and with the West more generally, accusing Europe of adopting a self-interested approach in its relations with his country.

"This [deterioration of relations between Russia and the EU] was not our [Russia's] choice; it was dictated to us by our partners," Putin said. "It was not we who introduced restrictions on trade and economic activities."

Putin claimed that Europe's reluctance to acknowledge the "legitimacy" of Russia's actions or to cooperate with the Russian-led Eurasian Economic Union are examples of the EU's allegedly self-interested attitude.

"We have never viewed Europe as a mistress," Putin said, employing the metaphor used in a question by Italian journalist Paolo Valentino, who had asked whether Russia felt betrayed by Europe "like a lover abandoned by his mistress."

"We have always proposed a serious relationship," Putin said of Russia's ties to Europe.

Despite his criticism of the EU, Putin said that Russia had always enjoyed a "privileged" relationship with Italy and that trust dominated the countries' political interactions.

Putin also blamed the West for deliberately stirring unrest in Kiev during the Maidan street protests of late 2013 and 2014, which led to the ouster of then-Ukrainian President Viktor Yanukovych in February of last year. He said that the situation on the grounds in Kiev at the time had been "in the hands of the U.S. ambassador or a CIA resident."

The Russian president also expressed his commitment to the Minsk agreements signed in February, despite ongoing cease-fire violations in eastern Ukraine. He said Russia would make every effort to influence the authorities of the "unrecognized self-proclaimed Donetsk and Luhansk republics" and urged the United States and EU to exert their influence over Kiev to foster dialogue between the warring parties.

Putin also claimed that Russia had merely recognized Crimeans' desire to join the country when it integrated the Ukrainian peninsula into its federal fold last March.

"I would like to ask those who do not want to recognize it [Crimea as Russian territory]: If our opponents call themselves democrats, I would like to ask what exactly democracy means. As far as I know, democracy is the rule of the people, or the rule based on the will of the people. So, the solution of the Crimean issue is based on the will of the people of Crimea."

The West had claimed that the armed men wearing military uniforms without insignia who had entered Crimea in February 2014 and seized government buildings had been sent by Russia. Putin only admitted after annexation of Crimea that these men - known as "polite people" in Russia - had in fact been Russian troops.

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 #5
Kremlin.ru
June 6, 2015
Interview to the Italian newspaper Il Corriere della Sera

Ahead of his visit to Italy, Vladimir Putin gave an interview to the newspaper Il Corriere della Sera.

President of Russia Vladimir Putin: Good evening.

Luciano Fontana: Good evening, Mr President. First of all, we would like to thank you for giving us this important opportunity to interview you today.

Vladimir Putin: It is my pleasure.

Luciano Fontana: My name is Luciano Fontana. I am the new head of Il Corriere della Sera, and here with me is my colleague, Paolo Valentino, who worked for a long time in Russia and even married a Russian woman.

Vladimir Putin: You are the new head of the newspaper?

Luciano Fontana: Yes, it has only been a month.

Vladimir Putin: Congratulations you on the appointment.

Luciano Fontana: Thank you very much, Mr Putin.

I would like to start with a question concerning Russian-Italian relations. This relationship has always been close and privileged, both in the economic and political spheres. However, it has been somewhat marred by the crisis in Ukraine and the sanctions.

Could the recent visit by Italian Prime Minister Matteo Renzi to Russia and your upcoming visit to Milan somehow change this trend, and if so, what is needed for that?

Vladimir Putin: First, I firmly believe that Russia was not responsible for the deterioration in relations between our country and the EU states. This was not our choice; it was dictated to us by our partners. It was not we who introduced restrictions on trade and economic activities. Rather, we were the target and we had to respond with retaliatory, protective measures.

But the relationship between Russia and Italy has, indeed, always been privileged, both in politics and the economy. For instance, in recent years, that is, in the last couple of years, trade between our countries increased elevenfold, from what I believe was $4.2 billion - we make calculations in US dollars - to over $48 billion, nearly $49 billion.

There are 400 Italian companies operating in Russia. We are cooperating actively in the energy sector, in an array of fields. Italy is the third largest consumer of our energy resources. We also have many joint high technology projects: in the space and aircraft industries, and in many other sectors. Russian regions are working very closely with Italy. Last year, almost a million Russian tourists, about 900,000, visited Italy. And while there, they spent over a billion euro.

We have always enjoyed trust-based relations in the political sphere as well. The establishment of the Russia-NATO Council was Italy's initiative - Silvio Berlusconi was Prime Minister at the time. This advisory working body no doubt became an important factor of security in Europe. In this regard, Italy has always contributed greatly to the development of the dialogue between Russia and Europe, and NATO as a whole. Not to mention our special cultural and humanitarian cooperation.

All this, of course, lays the foundation for a special relationship between our countries. And the incumbent Prime Minister's visit to Russia sent a very important message showing that Italy is willing to develop these relations. It is only natural that this does not go unnoticed either by the Government of the Russian Federation or by the public.

We are, of course, ready to reciprocate and go further in expanding our cooperation as long as our Italian partners are willing to do the same. I hope that my upcoming visit to Milan will help in this respect.

Luciano Fontana: I would like to satisfy my curiosity and ask you one more question about Italy.

You have known several chairmen of the Italian Council of Ministers - Romano Prodi, Silvio Berlusconi, Massimo D'Alema and Matteo Renzi. With whom did you find that you understood each other best? And how much, in your opinion, does the existence of a personal relationship - like the one you had with Silvio Berlusconi - contribute to good relations between countries?

Vladimir Putin: No matter what posts we occupy or what our jobs are, we are still human, and personal trust is certainly a very important factor in our work, in building relations on the interstate level. One of the people you have just mentioned once told me, "You must be the only person (meaning I was the only person) - who has a friendly relationship with both Berlusconi and Prodi." I can tell you that it was not difficult for me, I still don't find it difficult, and I can tell you why. My Italian partners have always put the interests of Italy, of the Italian people, first and believed that in order to serve the interests of their country, including economic and political interests, they must maintain friendly relations with Russia. We have always understood and felt that.

This has been the key element underlying our good relations. I have always sensed a truly sincere interest in building interstate relations irrespective of the domestic political situation. I would like to say in this regard that the attitude people in Russia have developed towards Italy does not depend on which political party is in power.

Paolo Valentino: Mr President, you are coming to Milan for the celebration of the Russia Day at the Universal Exhibition EXPO 2015. The core theme of this year's exhibition is "Feeding the Planet, Energy for Life." What is Russia's contribution to this cause? What does this effort mean for relations between states?

Vladimir Putin: This is one of the major challenges that humanity is facing today. So I can and must acknowledge that the Italian organisers chose one of the key themes for the exhibition.

The world's population is growing. According to experts, it will reach 9 billion people by 2050. But even today, according to the same sources, to the UN, 850 million people all over the planet are under-nourished or starving, and 100 million of them are children. So, there is no doubt that this is one of the key issues of our time. Many other issues, seemingly unrelated, will depend on how we deal with it. I am talking about instability among other things, that is political instability of entire regions, terrorism, and so on. All these problems are interrelated. The surge of illegal migration that has hit Italy and Europe today is among these resulting problems. I would like to repeat that, in my view, the organisers did the right thing pointing out the need to address this issue.

As for Russia's contribution, we channel over $200 million into this through UN programmes. Many countries around the world receive necessary support and assistance under these programmes using Russian resources.

We pay significant attention to the development of agriculture in our country. Notwithstanding all the difficulties that the development of Russian economy faces today, our agricultural sector, the sector of agricultural production, has been growing steadily - last year the growth was around 3.4-3.5 percent. In the first quarter of the current year, the growth stayed at the same level, exceeding 3 percent, at 3.4 percent. Russia is now the third largest grain exporter in the world. Last year, we had a record harvest of grain crops, one of the largest in recent years - 105.3 million tonnes. Finally, Russia has an enormous potential in this sphere. I think that we have the largest area of arable land in the world and the biggest fresh water reserves, since Russia is the biggest country in the world in terms of territory.

Paolo Valentino: Thank you, Mr Putin.

When we were talking about the shadow cast on our relations, you said that it was not your choice, and there is an opinion that Russia feels betrayed, abandoned by Europe, like a lover abandoned by his mistress. What are the problems in our relations today? Do you think that Europe has been too dependent on the United States in the Ukrainian crisis? What do you expect from Europe in relation to the sanctions? I may have asked too many questions at once.

Vladimir Putin: You have certainly asked a lot of questions, with an Italian flair. (Laughs)

First, about the mistress. In this kind of a relationship with a woman, that is, if you assume no obligations, you have no right to claim any obligations from your partner.

We have never viewed Europe as a mistress. I am quite serious now. We have always proposed a serious relationship. But now I have the impression that Europe has actually been trying to establish material-based relations with us, and solely for its own gain. There is the notorious Third Energy Package and the denial of access for our nuclear energy products to the European market despite all the existing agreements. There is reluctance to acknowledge the legitimacy of our actions and reluctance to cooperate with integration associations in the territory of the former Soviet Union. I am referring to the Customs Union, which we created and which has now grown into the Eurasian Economic Union.

Because it is all right when integration takes place in Europe, but if we do the same in the territory of the former Soviet Union, they try to explain it by Russia's desire to restore an empire. I don't understand the reasons for such an approach.

You see, all of us, including me, have been talking for a long time about the need to establish a common economic space stretching from Lisbon to Vladivostok. In fact, French President Charles de Gaulle said something similar a lot earlier than me. Today nobody objects to it, everybody says: yes, we should aspire to this.

But what is happening in practice? For example, the Baltic States have joined the European Union. Good, no problem. But today we are being told that these countries, which are part of the energy system of the former Soviet Union and Russia, they must join the European Union's energy system. We ask: Are there any problems with energy supply or with something else? Why is it necessary? - No, there are no problems, but we have decided that it will be better this way.

What does this mean for us in practical terms? It means that we will be forced to build additional generating capacities in some western regions in Russia. Since electricity transmission lines went through the Baltic States to some Russian regions and vice versa, all of them will now be switched over to Europe, and we will have to build new transmission lines in our country to ensure electricity supply. This will cost us about 2-2.5 billion euro.

Now let's look at the EU-Ukraine Association Agreement. It does not require that Ukraine becomes part of the European energy system, but it is considered possible. If this happens, we will have to spend not 2-2.5 billion but, probably, about 8-10 billion euro for the same purpose. The question is: why is this necessary if we believe in building a common economic space from Lisbon to Vladivostok? What is the objective of the European Union's Eastern Partnership? Is it to integrate the whole former Soviet Union into a single space with Europe, I repeat for the third time, from Lisbon to Vladivostok, or to cut something off and establish a new border between modern Russia and the western territories including, say, Ukraine and Moldova?

Let me tell you something else now, and you can decide for yourselves what to publish and what to leave out.

What are the roots of the Ukrainian crisis? Its cause seems to be completely disproportionate to what has become an utter tragedy today claiming many lives in southeast Ukraine. What sparked the crisis? Former President Viktor Yanukovych said that he needed to think about signing Ukraine's Association Agreement with the EU, possibly make some changes and hold consultations with Russia, its major trade and economic partner. In this connection or under this pretext riots broke out in Kiev. They were actively supported both by our European and American partners. Then a coup d'état followed - a totally anti-constitutional act. The new authorities announced that they were going to sign the Association Agreement but would delay its implementation until January 1, 2016. The question is: what was the coup d'état for? Why did they need to escalate the situation to a civil war? The result is exactly the same.

What is more, at the end of 2013 we were ready to give Ukraine $15 billion as a state loan supported by a further $5 billion via commercial banks; plus we already gave it $3 billion during the year and promised to cut gas prices by half if they paid regularly. We were not at all against Ukraine signing an Association Agreement with the European Union. But, of course, we wanted to participate in the final decisions, meaning that Ukraine was then and is still now, today, a member of the CIS free trade area, and we have mutual obligations as its members.

How is it possible to completely ignore this, to treat it with utter disrespect? I simply cannot understand that. The result that we have - a coup d'état, a civil war, hundreds of lives lost, devastated economy and social sphere, a four-year $17.5 billion loan promised to Ukraine by the IMF and complete disintegration of economic ties with Russia. But Russian and Ukrainian economies are very deeply interconnected.

The European Union unilaterally removed its customs duties for Ukraine. However, the volume of Ukraine's sales to the European market did not grow. Why not? Because there is nothing to sell. There is no demand in the European market for Ukrainian products, either in terms of quality or price, in addition to the products that were already sold before.

We have a market for Ukraine, but many ties have been severed unilaterally by the Ukrainian side. For example, all engines for our combat helicopters came from Ukraine. Now deliveries have stopped. We have already built one plant in St Petersburg and another plant will be completed this year, but the production of these engines in Ukraine will be shut down because Italy, France or Germany don't need and will never need such engines. It is impossible for Ukraine to divert its production in any way; it will need billions in investment to do this.

I don't understand why this was done. I have asked many of my colleagues, including in Europe and America, about it.

Paolo Valentino: And what do they answer?

Vladimir Putin: The situation got out of control.

You know, I would like to tell you and your readers one thing. Last year, on February 21, President Yanukovych and the Ukrainian opposition signed an agreement on how to proceed, how to organise political life in the country, and on the need to hold early elections. They should have worked to implement this agreement, especially since three European foreign ministers signed this agreement as guarantors of its implementation.

If those colleagues were used for the sake of appearances and they were not in control of the situation on the ground, which was in fact in the hands of the US ambassador or a CIA resident, they should have said: "You know, we did not agree to a coups d'etat, so we will not support you; you should go and hold elections instead."

The same could be said about our American partners. Let's assume that they also lost control of the situation. But if America and Europe had said to those who had taken these unconstitutional actions: "If you come to power in such a way, we will not support you under any circumstances; you must hold elections and win them" - (by the way, they had a 100-percent chance of a victory, everybody knows that), the situation would have developed in a completely different way.

So, I believe that this crisis was created deliberately and it is the result of our partner's unprofessional actions. And the coverage of this process has been absolutely unacceptable. I would like to emphasise once more: this was not our choice, we did not seek it, we are simply forced to respond to what is happening.

In conclusion - forgive me for this protracted monologue - I would like to say that it is not that we feel deceived or treated unfairly. This is not the point. The point is that relationships should be built on a long-term basis not in the atmosphere of confrontation, but in the spirit of cooperation.

Paolo Valentino: You say the situation got out of control. But is it not the right moment for Russia to seize the initiative, to find a way to engage its American and European partners in the search of solution to the situation, to show that it is ready to address this problem?

Vladimir Putin: That is exactly what we are doing. I think that today the document we agreed upon in Minsk, called Minsk-II, is the best agreement and perhaps the only unequivocal solution to this problem. We would never have agreed upon it if we had not considered it to be right, just and feasible.

On our part, we take every effort, and will continue to do so, in order to influence the authorities of the unrecognised self-proclaimed Donetsk and Lugansk republics. But not everything depends on us. Our European and US partners should exert influence on the current Kiev administration. We do not have the power, as Europe and the United States do, to convince Kiev to carry out everything that was agreed on in Minsk.

I can tell you what needs to be done; maybe I will anticipate your next question. The key aspect of the political settlement was to create conditions for this joint work, but it was essential to stop the hostilities, to pull back heavy weaponry. On the whole, this has been done. Unfortunately, there is still shooting occasionally and there are casualties, but there are no large-scale hostilities, the sides have been separated. It is time to begin implementing the Minsk Agreements.

Specifically, there needs to be a constitutional reform to ensure the autonomous rights of the unrecognised republics. The Kiev authorities do not want to call it autonomy, they prefer different terms, such as decentralisation. Our European partners, those very partners who wrote the corresponding clause in the Minsk Agreements, explained what should be understood as decentralisation. It gives them the right to speak their language, to have their own cultural identity and engage in cross-border trade - nothing special, nothing beyond the civilised understanding of ethnic minorities' rights in any European country.

A law should be adopted on municipal elections in these territories and a law on amnesty. All this should be done, as the Minsk Agreements read, in coordination with Donetsk People's Republic and Lugansk People's Republic, with these territories.

The problem is that the current Kiev authorities don't even want to sit down to talks with them. And there is nothing we can do about it. Only our European and American partners can influence this situation. There is no need to threaten us with sanctions. We have nothing to do with this, this is not our position. We seek to ensure the implementation of the Minsk Agreements.

It is essential to launch economic and social rehabilitation of these territories. What has happened there, exactly? The current Kiev authorities have simply cut them off from the rest of the country. They discontinued all social payments - pensions, benefits; they cut off the banking system, made regular energy supply impossible, and so on. So you see, there is a humanitarian disaster in those regions. And everybody is pretending that nothing is wrong.

Our European colleagues have taken on certain obligations, in particular they promised to help restore the banking system in these territories. Finally, since we are talking about what can or must be done, and by whom, I believe that the European Union could surely provide greater financial assistance to Ukraine. These are the main points.

I would like to stress that Russia is interested in and will strive to ensure the full and unconditional implementation of the Minsk Agreements, and I don't believe there is any other way to settle this conflict today.

Incidentally, the leaders of the self-proclaimed republics have publicly stated that under certain conditions - meaning the implementation of the Minsk Agreements - they are ready to consider themselves part of the Ukrainian state. This is a fundamental issue. I think this position should be viewed as a sound precondition for the start of substantial negotiations.

Paolo Valentino: So you are saying that it is out of the question for the Crimean scenario to be repeated in eastern Ukraine?

Vladimir Putin: You know, the Crimean scenario does not reflect Russia's position; it reflects the position of the people who live in Crimea.

All our actions, including those with the use of force, were aimed not at tearing away this territory from Ukraine but at giving the people living there an opportunity to express their opinion on how they want to live their lives.

I would like to stress this once again, as I have said many times before: if Kosovo Albanians were allowed this, why is it prohibited to Russians, Ukrainians and Crimean Tatars living in Crimea? And by the way, the decision on Kosovo's independence was made exclusively by the Kosovo Parliament, whereas Crimea held a region-wide referendum. I think that a conscientious observer could not but see that people voted almost unanimously for reunification with Russia.

I would like to ask those who do not want to recognise it: if our opponents call themselves democrats, I would like to ask what exactly democracy means. As far as I know, democracy is the rule of the people, or the rule based on the will of the people. So, the solution of the Crimean issue is based on the will of the people of the Crimea.

In Donetsk and Lugansk people voted for independence, and the situation there is different. But the main thing, something we must always bear in mind, is that we should always respect the feelings and the choice of the people. And if somebody wants these territories to remain part of Ukraine, they should prove to those people that their lives would be better, more comfortable and safer within a unified state; that they would be able to provide for themselves and ensure their children's future within this state. But it is impossible to convince these people by means of weapons. These issues, issues of this kind can only be resolved by peaceful means.

Paolo Valentino: Speaking of peace, the countries that used to be parties to the Warsaw Treaty and today are NATO countries, such as the Baltic states and Poland, feel threatened by Russia. NATO has decided to create special forces to address these concerns. My question is whether the West is right in its determination to restrain "the Russian bear", and why does Russia continue to speak in such a contentious tone?

Vladimir Putin: Russia does not speak with anyone in a contentious tone, and in such matters, to quote a political figure from the past, Otto von Bismarck, it is not discussions but the potential that counts.

What does the actual potential show? US military spending is higher than that of all countries in the world taken together. The aggregate military spending of NATO countries is 10 times, note - 10 times higher than that of the Russian Federation. Russia has virtually no bases abroad. We have the remnants of our armed forces (since Soviet times) in Tajikistan, on the border with Afghanistan, which is an area where the terrorist threat is particularly high. The same role is played by our airbase in Kyrgyzstan; it is also aimed at addressing the terrorist threat and was set up at the request of the Kyrgyz authorities after a terrorist attack perpetrated by terrorists from Afghanistan on Kyrgyzstan.

We have kept since Soviet times a military unit at a base in Armenia. It plays a certain stabilising role in the region, but it is not targeted against anyone. We have dismantled our bases in various regions of the world, including Cuba, Vietnam, and so on. This means that our policy in this respect is not global, offensive or aggressive.

I invite you to publish the world map in your newspaper and to mark all the US military bases on it. You will see the difference.

Sometimes I am asked about our airplanes flying somewhere far, over the Atlantic Ocean. Patrolling by strategic airplanes in remote regions was carried out only by the Soviet Union and the United States during the Cold War. In the early 1990s, we, the new, modern Russia, stopped these flights, but our American friends continued to fly along our borders. Why? Some years ago, we resumed these flights. And you want to say that we have been aggressive?

American submarines are on permanent alert off the Norwegian coast; they are equipped with missiles that can reach Moscow in 17 minutes. But we dismantled all of our bases in Cuba a long time ago, even the non-strategic ones. And you would call us aggressive?

You yourself have mentioned NATO's expansion to the east. As for us, we are not expanding anywhere; it is NATO infrastructure, including military infrastructure, that is moving towards our borders. Is this a manifestation of our aggression?

Finally, the United States unilaterally withdrew from the Anti-Ballistic Missile Treaty, which was to a large extent the cornerstone of the entire international security system. Anti-missile systems, bases and radars are located in the European territory or in the sea, e.g. in the Mediterranean Sea, and in Alaska. We have said many times that this undermines international security. Do you think this is a display of our aggression as well?

Everything we do is just a response to the threats emerging against us. Besides, what we do is limited in scope and scale, which are, however, sufficient to ensure Russia's security. Or did someone expect Russia to disarm unilaterally?

I have proposed to our American partners not to withdraw from the treaty unilaterally, but to create an ABM system together, the three of us: Russia, the United States and Europe. But this proposal was declined. We said at the time: "Well, this is an expensive system, its efficiency is not proven, but to ensure the strategic balance we will develop our strategic offensive potential, we will develop systems of overpowering anti-ballistic defence. And I have to say that we have made significant strides in this area.

As for some countries' concerns about Russia's possible aggressive actions, I think that only an insane person and only in a dream can imagine that Russia would suddenly attack NATO. I think some countries are simply taking advantage of people's fears with regard to Russia. They just want to play the role of front-line countries that should receive some supplementary military, economic, financial or some other aid. Therefore, it is pointless to support this idea; it is absolutely groundless. But some may be interested in fostering such fears. I can only make a conjecture.

For example, the Americans do not want Russia's rapprochement with Europe. I am not asserting this, it is just a hypothesis. Let's suppose that the United States would like to maintain its leadership in the Atlantic community. It needs an external threat, an external enemy to ensure this leadership. Iran is clearly not enough - this threat is not very scary or big enough. Who can be frightening? And then suddenly this crisis unfolds in Ukraine. Russia is forced to respond. Perhaps, it was engineered on purpose, I don't know. But it was not our doing.

Let me tell you something - there is no need to fear Russia. The world has changed so drastically that people with some common sense cannot even imagine such a large-scale military conflict today. We have other things to think about, I assure you.

Paolo Valentino: But you cooperate with the United States on Iran, and John Kerry's visit sent yet another message in this regard. Or am I wrong?

Vladimir Putin: You are right - it did. We are cooperating not only on the Iranian nuclear programme, but on other serious issues as well. Despite America's withdrawal from the ABM Treaty, our arms control dialogue continues.

We are not just partners; I would say we are allies in addressing the issues related to non-proliferation of weapons of mass destruction. We are undoubtedly allies in the fight against terrorism. There are some other areas of collaboration as well. The central theme of Expo Milano, which you mentioned earlier, is yet another example of our joint work. Indeed, there are plenty of issues that we continue to tackle jointly.

Paolo Valentino: Mr Putin, on May 9, Russia marked the 70th anniversary of the Great Victory, which liberated both your country and the entire Europe from Nazism. No other country paid as bloody a price for this victory as Russia. However, there were no Western leaders standing next to you on Red Square. Il Corriere della Sera published Silvio Berlusconi's letter criticising those leaders for their absence. I have two related questions.

Do you think that by their absence they showed disrespect for the Russian people? What does the memory of the Great Patriotic War mean to the Russian identity today?

Vladimir Putin: It is not a matter of identity. Identity is built on culture, language and history. This war is a tragic page in our history. When we mark such days, festive but also sad given the number of lives lost in that war, we think about the generation that made our freedom and independence possible, about those who triumphed over Nazism. We also think about the fact that no one has the right to forget this tragedy, first of all, because we must think about how to avoid the repetition of anything like that in the future. These are not just words; it is not an unfounded fear.

Today, we hear some people say that there was no such thing as the holocaust, for instance. We are witnessing attempts to glorify the Nazis and their collaborators. This is part of our life today. Today's terrorism in all its various manifestations is very much like Nazism; in fact, there is hardly any difference between the two.

As for the colleagues you have mentioned, it is their personal choice, of course, whether to come to Moscow to join in the celebrations or not. I think that they failed to see past the current complexity in international relations to something far more important that is linked not only to the past, but also to the need to fight for our common future.

They made their choice, but this day is, first and foremost, our holiday. You see, there were veterans from quite a number of countries in Moscow: from the United States, Great Britain, Poland and other European countries. In fact, it is these people who are the true heroes of this day, and this was very important to us. During those celebrations, we did not honour only those who fought Nazism in the Soviet Union; we also remembered the Resistance fighters in Germany itself, in France and in Italy. We remember all of them and pay tribute to all the people who did not spare themselves in the fight against Nazism.

Certainly, we understand only too well that it was the Soviet Union that made the decisive contribution into the Victory and suffered the most severe losses in the fight against Nazism. It is more than just a military victory to us, it is a moral victory. You see, virtually every family lost someone in the war. How can we forget this? It is impossible.

Paolo Valentino: There are a few more quick questions left.

Vladimir Putin: I hope they are quick indeed.

Luciano Fontana: You are a very popular leader in Russia, but in other countries and even in your own country you are often called authoritarian. Why is it so difficult to be part of the opposition in Russia?

Vladimir Putin: What is so difficult about it? If the opposition proves that it can tackle the challenges faced by a district, a region or the whole country, then, I think, people will always notice it.

The number of parties in our country has multiplied, in recent years we liberalised the process of establishing a political party and taking it to a regional and national level. It is all about their competence and ability to work with the electorate, to work with people.

Paolo Valentino: Then why are members of the opposition so rarely interviewed by the main Russian TV channels?

Vladimir Putin: I think if they have something interesting to say, they will be interviewed more often.

As for political competition, we know that various means are used against political rivals. Just take a look at the most recent history of Italy.

Paolo Valentino: Mr President, Greece is facing huge difficulties in its relations with Europe. If Greece leaves the eurozone, will Russia be ready to offer it political and economical assistance?

Vladimir Putin: We are building our relations with Greece irrespective of whether it is an EU, eurozone or NATO member. We have very close historical and good partnership relations with Greece, which is why it is up to the Greek people to make a sovereign decision as to which union and zone to be part of. But we don't know what will happen in the future, so it would be wrong or even harmful for both Greek and European economies if we, as the saying goes, try to read the tea leaves.

For an economy like Greece there are certain difficulties brought about by the common European rules. They cannot devalue the drachma because they don't have it, they are strictly pegged to the euro currency. Their boundaries are fully open for European goods, which gives a distinct advantage to the export-oriented economies. Common decisions are made concerning such sectors as agriculture and fishery, where Greece could have certain competitive advantages but there are limits as well.

Another sector where it has an advantage is tourism, of course, but it applies to the Schengen area and there are also some limits. We have a visa-free arrangement with Turkey and 5 million Russian tourists visited this country last year, while less than one million tourists visited Greece, around 300,000, as far as I know. However, Greece receives concessional loans, financial support from the European treasury, and it has access to the European labour market. There are also other benefits of being part of the European family.

It is not up to us here in Russia to decide what is more beneficial and preferable for Greece. Once again, it is up to the Greek people to make a sovereign decision in dialogue with their main European partners.

Paolo Valentino: I would like to ask the last two small questions.

Vladimir Putin: Are we going to stay here until morning?

Paolo Valentino: We can see four Russian emperors here, in this room. Which historical figure inspires you the most?

Vladimir Putin: You know, people ask me this question a lot. I prefer to dodge it since the answer can give rise to various interpretations. (Laughs)

So I will put it like this: I try not to idolise anybody. I try, or rather, I am guided by the interests of the Russian people in my work, taking into account everything that has been previously accumulated and the conditions we are living in today, and I try to get a glimpse of the way we should build our life, economy and policy - first and foremost, our domestic policy - as well as our foreign policy in the medium and long-term strategic perspective.

There are many good examples in both Russian and European history, as well as in world history. But all those people lived and worked in certain conditions. The most important thing is to be honest with yourself and with the people who have entrusted you with this work.

Luciano Fontana: One last question. What is your biggest regret in life? What do you consider a mistake that you would never want to make again?

Vladimir Putin: I will be quite frank with you. I cannot recollect anything of the kind. By the grace of God, I have nothing to regret in my life.

Question: You are a happy person.

Vladimir Putin: I am, thank God.

#6
Peak of inflation has passed, but risks remain - Nabiullina

MOSCOW. June 8 (Interfax) - The Central Bank of Russia is expecting a reduction of inflation and noted that its peak has already passed, although risks exist for it, Central Bank Governor Elvira Nabiullina said.

"Weekly inflation has remained at 0.1% for six weeks already. According to our estimate, we have passed the peak of inflation, we are forecasting its notable fall in the future, but risks, nevertheless, exist for inflation," she said at a budget committee meeting at the State Duma on Monday.

The Central Bank noted the following may lead to risks: the normalization of the monetary policy in the United States, which may raise the volatility of all currencies in countries with emerging markets, which includes Russia, also to the accelerated indexation of tariffs of natural monopolies. "In my view, based on the role in inflation of tariffs of natural monopolies, it is necessary to very prudently and accurately approach the requests for raising these tariffs, in order to not heat up inflation," she said.

The increase of tariffs, she said, will mean an increase in costs for companies, which will negatively affect future economic growth.

"There will be a double negative effect: the Central Bank will not be able to quickly lower the rate due to high inflation, and there will be direct growth of costs for companies," the Central Bank head said.

Risks remain for the prices of oil, which are currently very volatile, Nabiullina.

"We have managed to get inflation under control, and if no new shocks occur, then by the end of this year, we are forecasting the start of economic growth quarter-on-quarter," she said.

Nabiullina also said that the dominating factors, which are affecting the ruble's exchange rate, are the prices for oil and geopolitics. The operations of the Central Bank for replenishing the gold and forex reserves, she said, are having a small impact on the performance of the national currency.

For May and the start of June, the Central Bank bought a little more than $3 billion on the market.

"With the appearance of volatility and risks for financial stability, we will be ready to change the volumes of purchases or suspend them," she said.

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 #7
Business New Europe
www.bne.eu
June 5, 2015
Russia mines a richer seam
Amidst all of the doom and gloom in Russia's economy, some of the large metals and mining companies had a surprisingly good 2014.
Mark Adomanis in Philadelphia

I've written before about Russia's banking system and the annus horribilis of 2014. With the possible exception of Sberbank, Russia's other large banks have been beset on all sides, massively writing down the value of loans they had previously extended to Russian corporations and also taking huge hits on various investments, and derivative and currency positions. Several banks have already needed government assistance, and many others are likely to require it if they want to avoid turning into "zombie banks" like those of Japan in the early 1990s.

But in the "real" economy the story has been a lot less negative. Steel manufacturer Severstal, for example, was mentioned several times in a remarkably upbeat article in Newsweek about the Russian economy's unexpected resilience in the face of sanctions.

In reality, Severstal's performance wasn't all that great. Yes its gross profit was up marginally (about 0.9%) and its profit before financing and taxation was up by quite a bit more (about 34%), but its net income was sharply lower, a loss of $1.6bn in 2014 versus a profit of $89mn in 2013. Almost all of this change was driven by the titantic $1.8bn hit that Severstal took on foreign exchange losses. You can argue that these losses aren't "real" because they are more the result of temporary (and even irrational) fluctuations in currency markets, but even if you totally remove the adjustments for 2013 and 2014, net income still slumped by roughly 30%. It's not in nearly as bad a position as some large resource exporters (like Gazprom), but a look at the financials suggests that reports of Severstal's resurgence have been a bit overstated.

Other Russian resource companies, however, appeared to be in much better shape.

Rusal et al

Norilsk Nickel, despite also taking a roughly $1.6bn hit on forex translations, saw its operating profit double and its net income almost triple from in 2014. Some of that is due to a few particularly ill-advised investment decisions that the company made in 2013 (which had to be fully impaired and which reduced 2013 net income by about $500mn). But a good deal of this improvement appears very much genuine. Sales went up by 3.2% while the costs of those sales (COGS) went down across the board: COGS was down by 13%, while Selling, General & Administrative expenses (SG&A) were down by 19%. With increasing revenue and decreasing costs, particularly considering the crisis is roaring through large sections of the Russian economy, life was remarkably good for Norilsk Nickel in 2014.

Rusal also had, all things considered, a pretty decent 2014. Measured in dollars its revenue was down marginally (about 4.5%), but its COGS were down by a substantially larger amount (14.5%). Rusal's operating profit (gross profit minus its operating expenses) increased by more than $1bn, from a small loss in 2013 to an almost $1.1bn profit in 2014. There was still a large hit from forex expenses that pushed net income down into negative territory, but after posting a $3.3bn loss in 2013 (of which about $1.9bn was due to various restructuring-related expenses) the company suffered a net loss of only $90mn in 2014. It even had positive pre-tax income, which was very far from being the case in 2013. While net losses are obviously less desirable than net profits, and while it seems unlikely that Rusal's board will be throwing a huge party for the management team anytime soon, a more than $1bn positive swing in a single year is a quite dramatic improvement.

Other commodity producers (like Magnitogorsk Iron & Steel works) saw a broadly similar pattern: revenue that, in dollar terms, was essentially flat year over year, costs that were down between 10% and 20%, large forex losses, and a sharp improvement in overall net income.

Now that the ruble has broadly stabilised against the dollar, it seems unlikely that there will be further benefits (or losses) on the scale that was observed in 2014. That kind of enormous forex volatility is just not common. While there are exceptions, the financial statement seem to indicate that, on average, most Russian commodity producers had a net benefit from the ruble's slide: with ruble-based cost-structures their sales and administrative expenses were usually 10-20% lower than the previous year. That's not sustainable in the long term, the ruble can't collapse against the dollar every year, but it shows that the common story of universal doom and despair omits some very important parts of Russia's economy.

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 #8
Russia Insider
www.russia-insider.com
June 5, 2015
Russia's Recession: A Necessary Re-Balancing
Russia's recession is necessary to re balance the economy after the rouble devaluation and the oil price fall.  Meanwhile the Western sanctions ensure that it is the West which is blamed.
By Alexander Mercouris

My fellow contributor to Russia Insider, Dr. Gilbert Doctorow, has published a piece criticising attempts to "sugarcoat" the state of the Russian economy (see Stop Sugarcoating Russia's Economic Situation, Russia Insider, 30th May 2015).

He is right to do so.

The picture Dr. Doctorow describes is of an economy in recession. That was also my impression during a brief visit I made to Moscow in the run up to Easter.

That the Russian economy is in recession is not in doubt. There is also no doubt of its cause: the steep devaluation of the rouble last year caused by the collapse in oil prices.

The fall in the value of the rouble has caused inflation to surge and this has led in turn to a sharp fall in real incomes - the first time that has happened since Putin came to power.  

That fall has been made worse by the government's decision to cut spending to limit the size of its budget deficit. Part of that cut involved a 10% cut in pay for state employees, which has reduced real incomes further.

The fall in real incomes has in turn led to a steep fall in consumer spending, which explains the failure of the small businesses (which depend heavily on consumer spending) that Dr. Doctorow saw and which in his article he writes about.

The Russian government and the Central Bank have responded to this situation by prioritising inflation reduction. That explains the still very high interest rates (currently 12.5%) and the budget cutbacks.

Inflation reduction has in fact been the government's and the Central Bank's priority since 2012, when the simultaneous tightening of fiscal and monetary policy first caused economic growth to fall.

The high interest rates have however inevitably taken a toll on capital lending and investment, which explains the difficulties there are in obtaining credit in the secondary housing market and in the agricultural sector that Dr. Doctorow writes about.

In my opinion the high interest rates bear a greater responsibility for the tightening of credit conditions than the sanctions.  

The sanctions have undoubtedly created difficulties for the big Russian state banks - which are obliged to meet their foreign debt payments in full - and are therefore obliged to deleverage faster than they might have wished whilst being at the same denied access to western financing.  

However there is no doubt Russian banks can meet their debt payments as can Russia as a whole (see Doomsayers Proven Wrong: Russia Has Not and Will Not Run Out of Money, Russia Insider, 4th June 2015).  

Once interest rates come down there should be more than sufficient money available from domestic sources to cover the needs of the domestic economy.  Western scare stories that sanctions will cause a credit crunch that will cause the entire economy to grind to a halt are misplaced.

The big question is how quickly inflation and interest rates will come down.

Inflation is currently running at an annualised rate of 15.8% - down on its level at the start of the year of over 17%, and a faster reduction than many expected.  Interest rates have fallen from 17% at the start of the year to a still high 12.5% now.

There is still however a long way to go.  
 
I am one of those who thinks the Central Bank could bring interest rates down more quickly than it is doing without this causing the economy any major risk. However the decision is not mine to make and the Central Bank ever since 2012 has made it clear that its priority is inflation reduction over growth, with a medium term inflation target of just 4%. The Central Bank has also repeatedly made it clear that it will pursue a tough interest rate policy to achieve it however hard that is and however long it takes.

Experience of other economies with chronic inflation problems (such as Britain in the 1970s to 1990s) suggests that for inflation to be squeezed out of the system economic policy must be geared to that objective. This inevitably reduces growth, at least in the short term.

That seems to be the situation Russia is in now. It has been clear since 2012 that the Russian authorities have prioritised inflation over growth.

Having said this, provided inflation does indeed continue to come down at the rate it is currently doing, monetary policy will ease, eventually to the point when it will bring the current recession to an end.

Dr. Doctorow's assessment of the state of the Russian economy is therefore essentially correct. The economy is indeed in recession.

However that does not mean that there is a crisis or that the recession Russia is currently going through is in any way exceptional.

The one further comment I would make is that I don't personally know of anyone who doubted when the rouble fell last year that Russia would experience a recession in 2015. The debate as I recall it was not whether or not there would be a recession. It was whether there would be a recession or a full=scale collapse, with the Western commentariat mainly predicting a collapse.

It is now quite clear that there will not be a collapse - a fact Dr. Doctorow makes himself.  

The only question is how deep the recession will be. As of the time of writing it appears that it will be shorter and shallower than most people (including the Central Bank) were expecting last year, with the lowest point probably being reached in the second or possibly the early part of the third quarter.

As I discussed in two long pieces discussing Russia's credit downgrade, recessions for all the pain they cause are an unavoidable and even necessary fact of economic life (see Russia Credit Rating Downgrade Is Blatantly Political. Here's Why, Russia Insider, 12th January 2015 and see How the Credit Rating Agencies Got Russia Completely Wrong, Russia Insider, 28th April 2015). Given the scale of the devaluation last year, a recession was not just inevitable.  It was necessary, in order to enable the economy to rebalance away from its reliance on foreign capital and imports.

It is that rebalancing we are now seeing and which is causing the recession that Russia is currently going through.  

I will finish with one final observation.  

At the same time that Russia finds itself in recession and Russian living standards have fallen, Putin's popularity and that of the Russian government has hit unprecedented levels.

That is the reverse of what one would normally expect in such a situation.

I would suggest the main reason for that is the sanctions and that it is in fact the chief result of the sanctions.  

If there were no sanctions and the economy had been hit purely by the oil price fall and the rouble collapse, then it is difficult to believe Putin's popularity would have held up, let alone increased to the stratospheric levels we are now seeing.  

As it is, though the economy's difficulties have actually been caused far more by the oil price fall and the rouble collapse than the sanctions, virtually every Russian thinks otherwise and blames the sanctions.  

Since the sanctions are universally seen as wrong and unfair - Dr. Doctorow himself comments on the extraordinary burst of patriotism that is underway and which the sanctions have in large measure provoked - they have caused Russians to blame the fall in their living standards not on Putin but on the West.

In other words, and not for the first time, the West has acted in a way that actually helps Putin politically, explaining why after 15 years he remains in power with no challenge in sight. 

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 #9
www.rt.com
June 6, 2015
Moscow protesters rally against budget cuts in science, education

Over 3,000 protesters have gathered in Moscow to call for science and education reforms in Russia, amid budget cuts and the closure of a leading scientific foundation over a "foreign agent" tag.

About 3,500 protesters have gathered at central Moscow's Suvorov Square demanding the Russian government support scientific research and education by increasing its budget, providing self-governance and autonomy in education and science and to respect academic freedoms.

"We [also] demand an immediate stop to the persecution of science and education organizations, charity funds, as well as other non-profit organizations using the tag 'foreign agent' or the equivalent," the protesters' resolution said.

Leading scientists, including the head of the Institute for Information Transmission Problems, member of the Public Council of the Ministry of Education Mikhail Gelfand, made speeches at the rally held under the slogan: "No science, no future."

Opposition politicians such as Aleksey Navalny joined the protests, along with journalists, human rights activists and students.

The protest follows the closure of The Dynasty Foundation after the government branded it a "foreign agent" on May 25, a tag applied to non-governmental organizations (NGOs) that receive funding from abroad and engage in political activities.

Dmitry Zimin, the 82-year-old founder of the organizational and a telecoms tycoon, has argued that he financed the foundation from personal bank accounts located abroad. Shortly after the Dynasty Foundation's closure he left Russia.

The Dynasty Foundation was established in 2002 as a non-profit organization to aid the development of fundamental scientific research and education, the popularization of science, civic education and help projects in the sphere of culture. The planned 2015 budget for programs and projects of the foundation was 435 million rubles (about $7.7million).

The Ministry of Justice is not going to review its decision unless the organization stops being funded from abroad, said Aleksandr Konovalov, the ministry's head, as cited by RIA Novosti on Thursday.

The "Foreign Agents Law," introduced in Russia in 2012, specifies that all NGOs receiving funding from abroad and even partially engaged in political activities, must register as foreign agents. In May, President Vladimir Putin signed a bill banning the activities of foreign groups that pose a threat to national security.

In 2013, Vladimir Putin signed a law to reform the Russian Academy of Sciences, the country's leading scientific research establishment comprising about 50,000 researchers in over 400 institutions. Under the law, the management of most of the academy's property was transferred to a new federal government agency.

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 #10
Sputnik
June 8, 2015
Undercover Agent Helped Nab Suspects in Nemtsov's Murder - Report

Information received from an undercover agent helped the law enforcement agencies swiftly apprehend those involved in the murder of Russian politician Boris Nemtsov, the Russian newspaper Kommersant reported, citing a source familiar with the situation.

The source said that the suspects were engaged in debt collection-related activities in Moscow. Their meetings took place in a well-known Moscow restaurant, where security staff decided to launch audio and video surveillance of suspicious customers.

After the murder of Boris Nemtsov, the undercover agent, who was close to suspected Chechen debt collectors, advised police to confiscate the video footage from the restaurant and use it in order to identify and detain the suspects, according to the source.

It also said that the footage particularly helped to detain Tamerlane Eskerhanov, Shadid Gubashev and Khamzat Bakhayev.

Earlier, it was reported that investigators had obtained information from a secret witness, who communicated with the suspects as they plotted Nemtsov's murder.

Meanwhile, Russian Investigative Committee spokesman Vladimir Markin has denied information about the suspects being detained with the help of an undercover agent. He declined to elaborate.

A total of five people have been arrested in connection with the killing of Boris Nemtsov. Apart from Eskerhanov, Bakhayev and Gubashev, they include Zaur Dadayev and Shadid Gubashev's brother Anzor.

Investigators believe that the killer is Zaur Dadayev and that the rest could be his accomplices.

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 #11
Ekho Moskvy (Moscow)
June 4, 2015
Russian journalism experiencing "difficult period", says liberal columnist

Journalism is going through a "difficult period" in Russia, but it should not be "buried" or "mourned", an influential liberal commentator said on 4 June.

Answering questions from listeners of the Gazprom-owned, editorially independent Ekho Moskvy radio station, Oleg Kashin, who contributes to a number of liberal Russian media outlets but is currently based in Switzerland, disagreed with the suggestion that there is no such thing as journalism in today's Russia, only individual journalists.

"You know, it seems to me that this is playing around with words. If there are journalists, then clearly there is journalism. It's a different matter that, like all public institutions in Russia, journalism is currently going through a difficult period, it's often being replaced with imitations, and, more generally, in the chain of relations between the state and society, there simply isn't any such link as journalism. But that doesn't mean that it should be buried or mourned. Everything will change at some point," he said.

"If you look for decent media, you can find them"

Kashin, who recently questioned whether Ekho Moskvy is as editorially independent as its editor-in-chief Aleksey Venediktov claims it is, also challenged the suggestion that Russia does not have independent media.

"I wouldn't start fetishizing the concept of independent media. I don't want to name them, because I don't want to offend anyone, but there are opposition websites that are genuinely independent and that are controlled purely by their journalists and their editors, and that peddle some sort of mad propaganda to the effect that 'Kerry visited Putin carrying a box of compromising material', or 'Russia has sent 100,000 tanks into Ukraine'. Now they're independent, but what's the benefit of that? On the other hand, there are publications that belong to people who frighten us, I don't know, let's say [billionaire Mikhail] Prokhorov, if we're talking about [business media group] RBK. Is a media outlet owned by Prokhorov independent or not? It's sort of not, but at the same time it observes and constantly displays the principles of quality, professional journalism, and that prompts respect and admiration," he said.

"I would also like to draw your attention to some small new websites that, over the past year, have been cropping up more often than major media outlets have been experiencing difficulties. I would single out Mediazona, which writes about the courts, prisons, human rights. It's the best publication in its field. The people from the 'Help Needed' foundation have set up a wonderful site on social issues, called 'That's How It Is'. The editor-in-chief there is Andrey Loshak. There's Znak in Yekaterinburg, and there's something else - if you look for decent media, you can find them," he added.

Authorities see solving high-profile murders as "secondary priority"

Asked why the murders of so many Russian journalists went unsolved, Kashin, who in 2010 was severely beaten outside his home in Moscow in an attack that is yet to result in any successful prosecutions, said the authorities did not take the problem seriously enough.

"It seems clear to me that the authorities have completely different priorities. The authorities excitedly and happily nab people who publish some sort of photographs with swastikas on [social networking site] VKontakte, or suspects in the Bolotnaya case, or people who disclose state secrets. People who have committed political killings, the authorities nab them as a secondary priority. Right now we can see right in front of us that a struggle has been going on for many months around punishing the people who killed [opposition politician Boris] Nemtsov. It's very clear what these people are about, but they're patriots and brave warriors, so what do we do about them? Of late, people with links to the [2009] killing of lawyer [Stanislav] Markelov and journalist [Anastasiya] Baburova have been turning up in high office in the Donetsk People's Republic, or somewhere else, and essentially no one's worried about this. That, I would say, is your answer."

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 #12
Russia Direct
www.russia-direct.org
June 5, 2015
Troublesome Chechnya: A sign of Russia's stability or weakness?
The more that Ramzan Kadyrov becomes a national political figure in Russia, the more the questions will persist about Kadyrov's and Chechnya's special relationship with the Kremlin.
By Sergey Markedonov
Sergey Markedonov is Associate Professor of Foreign Policy and Region Studies at Russian State University for the Humanities. Markedonov was also a visiting fellow at the Center for Strategic and International Studies (CSIS), Russia and Eurasia Program, Washington, D.C.

If sociologists took to compiling a ranking of the most active media figures in Russia, one of the top three would almost certainly be the head of Chechnya, Ramzan Kadyrov. Not a day goes by without his name topping news feeds and headlines.

Early June was no exception. YouTube blocked a film about the Chechen leader made by oligarch-in-exile Mikhail Khodorkovsky's Open Russia organization. Despite the block, anyone who wants to can watch this film without too much difficulty (after all, today's information society does not recognize restrictions). But those looking for shocking exposés are likely to be disappointed.

The Open Russia project does not lay bare any new facts; rather it systemizes and arranges everything that has already done countless times in the media and via social networks (thanks in part to the efforts of the film's protagonist). It probes human rights issues in the North Caucasian republic, the special political and legal regime there, and its informal relations with the Kremlin.

Even the words of President Vladimir Putin about his "paternal feelings" toward the Chechen leader merely lend emotional coloring to a familiar picture. The relationship between the heads of Russia and Chechnya is founded less on strict subordination than on a special format that allows a regional manager to receive a degree of autonomy higher than any other.

It is not the informational impact of the film that matters, but the fact that it was blocked, which demonstrates once again the considerable resources and influence that Ramzan Kadyrov wields. Nor is it likely that he personally had to place a phone call or seek help from his "spiritual father."

The management style of "Chechnya's CEO" is to take a hands-off approach - not only in the republic itself, but far beyond its borders. Also important is making friends and enlisting support, which can come in useful at any level of business administration.

However, most publications devoted to the "post-Soviet mountain dweller" record just the facts of his rapid rise, leaving aside the reasons for it. The main fact is, of course, that shortly after his thirtieth anniversary, he became the head of one of the constituent entities of the Russian Federation in the North Caucasus.

And today, eight years later, many experts (regardless of their personal feelings about him) do not see a serious alternative. What makes him irreplaceable? Is it simply Moscow's desire to establish authoritarian order in the country as a whole and in Chechnya in particular? In the meantime, without answers to these questions any assessment of Russian policy in the North Caucasus is incomplete.

Ideologically the Chechen leader is fond of appealing to the traditions and history of his people. And surprisingly even his fiercest critics and opponents swallow the bait, reeling off statements about the "new stone age" in Chechnya.

In actual fact, the political system of Ramzan Kadyrov is a product of more modern times. Note that, in contrast to other North Caucasus republics, where complex models exist to coordinate the interests of different spheres of influence, the Chechen system is de facto autocratic.

In Chechnya, "Kadyrov" is not just the name of the leader. It represents the linchpin of the entire system. For centuries Chechens have not tolerated being a vassal state inside a feudal system. For them, Kadyrov is the supreme leader, regardless of his age. Such a radical turn of events did not just happen by itself. Some fundamental premises lay behind it.

The first is the headlong degradation of the institutions of kinship, which began not yesterday but years ago. The process was rapidly accelerated by the collapse of the Soviet Union and the two military campaigns of the 1990s. Today the concept of teip (clan) is nothing more than a journalistic stereotype. Suffice it to recall the confrontation between Kadyrov and Yamadayev, who belonged to the same teip (the Benoy clan).

That is not the only important premise. Whatever is written about "Chechnya's special status," it is worth bearing in mind the republic's relationship with "Greater Russia" and what would have happened if the Kremlin had not staked all on the policy of "Chechenization," which meant counting not only on local cadres (the logical and justifiable choice at a time of unresolved conflict), but also on the personification of power.

Struggling with the gubernatorial free-for-all of the 1990s, which stemmed from, among other things, the diverse models of government and management, Moscow opted for a system of miniature presidential republics. This universal approach solved the problem of unification, but not manageability.

The loyalty of these "presidents" was not a silver bullet for national unity, because isolated from its local value, it was of little use. The Kremlin chose not get too involved in resolving regional problems, preferring a system of "remote control."

Chechnya in the 2000s became a symbol that the country had put the years of disintegration behind it. Nowhere else in the former Soviet Union had a separatist territory come back under central control. In Russia's case, the problem region did not just return, but turned into a showcase of loyalty and stability (although not total pacification, as evidenced by the clashes in Grozny last December).

However, the price of this symbolism was unprecedented political independence for the Chechen leadership. Whereas previously Chechnya existed under a kind of "one country, two systems" concept (as in the case of China and Hong Kong), in 2014-2015 Ramzan Kadyrov entered an all-Russian orbit, for which he should not be criticized.

Kadyrov thinks in different categories. If you need a symbol of stability so much, then let me take part in shaping your agenda, he seems to say. All the more so given that a confrontational style is Kadyrov's trademark like no one else's. Having been nurtured and immersed in it, he was able to build a chain of command inside his republic. The calls in Moscow today for mobilization invite the question as to where this model has shown its full worth. Many would answer without hesitation.

But the main difficulty lies in the room for maneuver. Until a settlement is reached on Ukraine (highly problematic, to say the least), the logic of mobilization and confrontation will persist. This, incidentally, is the result not only of the Kremlin's desire, but also of the West's eagerness to punish Russia for Crimea and Donbas instead of trying to resolve the conflict and reach a compromise with Moscow.

But indulgence of such a confrontational leader - in unison with the Russia's growing reactionary ideological mood - is tipping the country into the archaic past, while marginalizing it internationally, not only in the West, but also in the East. In China, which claims to be a strategic partner of Russia, experts are extremely skeptical about Chechen home rule, seeing it more as a sign of weakness than strength.

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 #13
Moskovskiy Komsomolets
June 2, 2015
Analyst eyes possible replacements for Russian premier
Nikita Krichevskiy, Gref, Shuvalov, and Kudrin - Contenders for the Premier's Chair?

Pickled nightingales

You may think what you like, ladies and gentlemen, but this author continues to insist that the dismissal of Medvedev's government could happen at any moment. Let us leave the reasoning aside - there are plenty of reasons both among supporters and opponents of the theory of a change of cabinet - and let us talk about the prancing contenders for the premiership. About the Reformer, the Industrialist, and the Liberal.

German Gref, Igor Shuvalov, and Aleksey Kudrin - this is probably an exhaustive list of high-profile people who most often talk about their big-headed prime ministerial ambitions. They have different "election programmes" from each other, and they present the Principal and society with their achievements and plans in different ways, but all their signals predictably come down to one thing: It will be better than under the Medvedevites, who have lost all sense of moderation.

For the time being the Principal is biding his time. But it seems that his choice is becoming increasingly obvious.

The reformer

A few days ago an extensive interview by Gref came out in a popular business newspaper, in which he set forth his views about reconstructing the work of the fading government, reported on how Sberbank will successfully hobble the deepening crisis, and shared his impressions of productive interaction with the leaders of major Russian and foreign companies.

Some people might object that the article was timed to coincide with the annual shareholders' meeting. Possibly. But then what do Gref's views on the system of state power, and primarily the executive, have to do with that? "No sources for a new wave of economic growth can currently be seen," Gref observed wisely. "There is only one way out of the situation - to launch serious reforms of all relations in the economy... We can start with the system of executive power. There is no need to touch the constitutional foundations - there is more than enough scope for activity in  the sphere of reforming the executive hierarchy."

Institutions again, confound them. There is something that Gref and the analysts who identify with his intellectual and material ideas are obstinately ignoring. First of all, the opinion of many foreign economists, who assert that there is no good theory which could establish links between political institutions and growth, nor any reliable empirical proof of the existence of such links. Second, the increasingly obvious advantages of state capitalism, whereby the rates of economic growth overall do not differ from the analogous indicators of countries with democratic regimes. Third, the experience of China, which has become the first economy in the world with very weak institutions, according to international assessments such as Doing Business or Transparency International.

The system is slowly degenerating, Gref sums up, and immediately proposes to create a new institution, this time a supragovernment reform centre, for some reason or other citing the example of Malaysia (the PEMANDU agency). You will recall that in the second half of the 1990s our young reformers kept going on about not Malaysia, but Argentina, popularizing the experience there, which, however, did not save the Argentines from a default in 2001.

One way or another, currently the Malaysian prime minister is travelling about Kuala Lumpur maybe with a blue flashing light and even in the leftmost lane, but in the general traffic. Without any special protection. Is Gref prepared to propose something similar? Of course not - the Principal may not understand the humour. In the same way he does not want to head the organization being proposed by him - evidently he has outgrown it.

The industrialist

Shuvalov, unlike Gref, prefers to send signals not via the press, but primarily through public utterances in media platforms. Many people remember his May announcement of the end of the crisis, although in January in Davos he was thinking about Russia's economy entering a more protracted and profound crisis as compared with 2008.

Personally what sticks out in my mind is Shuvalov's "decade of prosperity," which he predicted at the Sochi session of the Valdai Club in October 2014. Another equally interesting aspect: Shuvalov, as it seemed at the time, very much liked the figure of Brezhnev's premier Aleksey Kosygin. An industrialist who had been elevated, but not a strong manager a la Yuriy Luzhkov or, sorry, Murtaz Rakhimov, particularly in questions of budget distribution. From what Shuvalov said, he has repeatedly told the Principal about the stormy discussions between the bronzed general secretary and the young energetic chairman of the council of ministers (the analogies are clear, to my mind). For your information: The "young" Kosygin was nearly three years older than "old man" Brezhnev.

This is not the time or the place to analyse Kosygin's reforms, whose pivot was the unsuccessful attempt to give the socialist enterprise, which operated amid a planned economy and directive price formation, at least a bit of economic independence. Obviously Shuvalov, as the main person in charge of the economy in the government, prefers to work or "generate a process which is not result-oriented" (this is not the author's trolling, but a provocative thought of Gref). At the same time to publicly talk about the government's (read his own) achievements.

How effective would a Shuvalov premiership be? The thesis of Nassim Taleb, the author of The Black Swan, about the school bus driver (here the driver of the Russian economy), who previously has had several accidents, and whom we are entrusting with driving the precious means of transport again, is relevant here. It would not be out of place to also recall Taleb's "blindfolded" driver. It seems that Shuvalov is intellectually blind, in spite of all the clever efforts of the pro-liberal clan behind him.

Finally, the last thing in this section. The originators of economic theory David Hume and John Stuart Mill said with one voice (although at different times) that with the introduction of any system of rule, it is necessary to proceed on the basis that the ultimate aim of a contender for power is the satisfaction of personal interests. How does Shuvalov see possible checks and balances for the neutralization of the inevitable - according to the classic authors - arbitrariness, corruption, and attachment to foreign assets?

The liberal

I doubt anyone is likely to recall a single significant political or economic problem on which Kudrin has not aired his views recently. Yesterday the former head of the Ministry of Finance informed Interfax that he is not ruling out a possible return to executive power. Last week he made a whole series of fine statements. Here are just some of the questions that did not escape his attention: the glorious anniversary of Gorbachev's perestroyka, the joyless prospects for our economy, the need to toughen up requirements when giving out banking licenses, the impasse in confrontation with the West, and tough criticism of the Law on Foreign Agents. And that is not counting the reports and information statements from the Committee for Civil Initiatives, headed by Kudrin.

But it is not public activeness, expert knowledge, or bureaucratic experience that makes it possible to categorize Kudrin as a main contender for the premier's chair. They say that Kudrin has recently become a champion at working meetings with the Principal. Sometimes the country's main office is not enough for the two old comrades, and then the discussions go "among the people," for instance to the April live phone-in.

But even this does not testify to Kudrin's leadership in the prime ministerial ambitions race. If the resignation of the Medvedev government were to happen in the near future, Kudrin will be the new premier primarily because he is known and welcomed by the very same West with which tense relations are, for the Russian elite, growing from a thorn into a festering sore. And indeed how can you not be kindly disposed to a man who for a period of many years has paid tens of billions of dollars of budget funds into overseas debt obligations to the detriment of his own economy?

Strictly speaking, the "effectiveness," to use traditional economic language, of appointing Kudrin as premier seems to be in the normalization of relations with the great and the good. First and foremost through the return to the freebee times we liked so much.

Will there be reforms? Of course there will, how could we cope without them. The school bus is still on the move.

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#14
Interfax
June 8, 2015
Russians like Belarus and China, have aversion to U.S., EU and Ukraine - poll

Most Russians speak ill of the United States, the European Union and Ukraine and see Belarus, China and Kazakhstan as friends, the Levada Center has told Interfax.

Seventy-three percent of 1,700 respondents polled in 134 populated localities on May 22-25 expressed negative feelings for the U.S., 15 percent said the opposite, and 12 percent were undecided.

Russians have similar sentiments about the European Union and Ukraine: 26 percent have a positive attitude and 59 percent feel negative. A total of 16 percent and 14 percent, respectively, were undecided.

Thirty-nine percent of the respondents assessed Russia-Germany relations as normal, 33 percent said the relations were passing through a period of cooling, 12 percent claimed tensions and 2 percent animosity. Nine percent said the relations were good.

Russians traditionally like Belarus and China (83 percent and 80 percent, respectively), and 7 percent feel the opposite.

Opinions about Georgia differed: 42 percent of the respondents like the country and 36 percent do not. Almost a quarter of the respondents (22 percent) could not answer the question.

In the opinion of the respondents, the top five friends of Russia are Belarus (55 percent), China (43 percent), Kazakhstan (41 percent), India and Armenia (18 percent each). The 'anti-rating' leaders are the United States (73 percent), Ukraine (37 percent), Latvia and Lithuania (25 percent each) and Poland (22 percent).

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 #15
Rossiyskaya Gazeta
June 2, 2015
A 21st Century Vienna Concert
By Sergei Karaganov
Dean of the School of International Economics and Foreign Affairs National Research University Higher School of Economics

The year 2015 is a year of many jubilees - 70 years since the Great Victory and the end of the Second World War; 25 years since the fall of the Berlin Wall and the subsequent unification of Germany; and 40 years since the signing of the Helsinki Final Act and the subsequent creation of the Organization for Security and Cooperation in Europe.

These events have overshadowed the glorious jubilee - the 200th anniversary of the victory over Napoleon in the European war and the Congress of Vienna. In Vienna, in the course of informal consultations, Russia's strength, the idealism and wisdom of Alexander I, and the diplomatic genius of Metternich and Talleyrand helped European nations to forge the Concert of Europe which ensured absolute peace on the continent for several decades and a relatively peaceful order for almost a century - the most brilliant era in European history. The main achievement of the Congress of Vienna was that the post-war order was relatively fair and built without any humiliation of defeated France.

Alexander and the great diplomats had the feeling that they were working for decades ahead. Maybe that was why they succeeded. The Concert of Europe proved to be effective due to the relative homogeneity of the political powers that founded it: some of them were semi-feudal and others semi-capitalist, but all of them were harshly ruled by monarchs or narrow ruling classes, which shared common values.

The Congress of Vienna of 70 years ago, when the United Nations, the International Monetary Fund, the World Bank and other institutions were established at a series of conferences in San Francisco and Bretton Woods, did not create a new Concert of Nations. There followed a bipolar division of the world, which did not result in a new world war only because God, through the hands of Kurchatov, Oppenheimer, Fermi, Lavrentyev, Sakharov, Teller, Korolev and von Braun, gave mankind the nuclear "weapon of Armageddon," which saved and still saves it.

There emerged no "Congress of Vienna" after the Cold War, either, although the solemn words and commitments of the 1990 Paris Charter looked like a historic accord on "eternal peace." Many experts, including this author, suggested something similar to the Concert of Europe. Instead, the Atlantic part of the former bipolar system decided in favor of a soft variant of one of the most shameful episodes in its history - the Treaty of Versailles, which put Germany in an intolerable position after World War I and led mankind to the second world war in a generation. In addition, the Paris Charter was built on the illusion that the parties to the conflict could quickly move to a shared social and political path. Meanwhile, the West quickly switched to post-European values, while Russia abided by traditional European ones - sovereignty, a strong state, and Christian ethics and morals, from which it had been forcibly separated during the communist era. Some of the value differences were hard to predict. But one was evident, although some people tried not to notice it: Russia could not abandon its basic, genetic values--its millennial desire for sovereignty and security, and (since the times of Peter the Great) its habit to feel a great power.

Now Russia is breaking this second edition of the Versailles policy - hopefully, without a big war.

The Cold War was followed by a ten-year illusion of a unipolar world. Later, the West began to decline politically, morally and economically, while the non-West began to rise. Thus the present-day world, which is called multipolar, has come to exist. But I think that multipolarity is also a temporary phenomenon. It reflects the rejection of a unipolar world (the term came into being precisely as its negation), as well as the current inability or unwillingness to see macro-trends which are already working.

This term also hides another upcoming reality. The 500-year-long domination of Europe and, later, its powerful nephew, the United States, is coming to an end. Probably, the slow end of the centuries-long military, economic, ideological and cultural hegemony of the West in the world and the rise of the non-West is a major feature of this stage of world development.

There are many factors that caused these changes. They include various kinds of crises in the West (I would not like to discuss them now that political relations between Russia and the West have become aggravated, as that might sound like schadenfreude).

But the most important factor is the growth of economic and informational globalization of the non-West - ironically due to the West. Countries and peoples of the former periphery have received access to technologies, education and advanced social practices. The technological revolution in transport has linked markets. New countries have got an opportunity to compete on the global level, using their relative advantages.

This large-scale and relatively conflict-free redistribution of power became possible due to the presence of nuclear weapons which made it impossible to stop the rise of new forces militarily, without risking self-destruction.

The civilizing role of nuclear weapons is evident especially now when the decencies have been cast aside and when the losing West has begun to act without hypocrisy and gloves, breaking almost all moral, legal or political standards which it itself proclaimed in the years of its prosperity and might.

I invite readers who remember the bombings of defenseless Yugoslavia, the aggression against Iraq under a false pretext, the attack against Libya which had relinquished its nuclear program, and attempts to overthrow the unwanted regime in Syria with the support of much gloomier regimes and forces, to try to imagine what would happen with the rise of China if the latter did not have nuclear weapons and if a massive attack against it could not provoke an escalation of the conflict, involving super-nuclear Russia. I am afraid China would now lie in ruins, instead of enjoying growing prosperity and might.

Judging by the current rage in the West over the rise of Russia, which has demanded respect for its interests, it would have been finished off in the years of its weakness but for its nuclear potential, preserved in the 1990s through the heroic efforts of half-starved engineers, scientists and military. I have repeatedly heard regret at international discussions that Putin cannot be "punished" like Milosevic was.

The United States' semi-exit from Europe and the Middle East is one manifestation of the tendency towards the weakening (possibly historic) of the West. Deliberately or semi-consciously (not a single document or serious U.S. study proclaims the theory of controlled chaos), the U.S. leaves behind crises and conflicts. Maybe, it plans to return later, relying on its still enormous military power, or to make its European allies depend on it, or, perhaps, it has lost its strategic benchmarks and is simply incompetent in the conditions when the world is following unforeseen scenarios.

The U.S. already "semi-exited" once in the past half a century - after the Vietnam War which had morally exhausted the country. Yet it came back.

Now this exit may have a more severe outcome. Some of the U.S. allies, especially the UK, are desperately urging Washington to return, as they fear to be left without powerful protection. But a return on the former terms will hardly take place. The world is filled with new powers which do not want to see the former hegemony. Although it often helped to maintain relative stability, it ceased when America lost its counterweight - the Soviet Union.

If the trend towards the West's weakening persists, which is likely, considering the vector of changes in the balance of power, the "international community," and not just the West which is trying to speak on its behalf, will be faced with the problem of controlling this process and avoiding destabilization. Just a decade ago the world discussed how to manage "the rise of new powers." The weakening may take an era and proceed relatively calmly. I think Europe will continue to give in - resisting the process, of course. There is no confidence about the U.S. policy. For all its problems, the United States is still a vigorous nation.

The super-harsh and even painful reaction of the West to the Russian policy aimed at ending the inertia attack on its interests through attempts to involve Ukraine into the zone of its influence and control is further evidence that the process will not be easy.

The weakening of the West will likely be a major feature of the coming era, and the continuation of the tendency towards renationalization of world politics may be another important feature, along with a return of traditional geopolitics, contemptuously rejected just a few years ago, on a global level.

But this will be a different kind of geopolitics. For all the importance of the military factor which used to play the key role in it, now the economy will play the decisive role - largely due to one more key tendency in world development, namely, the new democratization. The interests of the masses increasingly influence the behavior of the ruling circles, even in not very democratic countries. And the main demand of the masses is well-being.

Along with the process of world politics' economization, there is a growing tendency towards de-globalization or a different globalization. The WTO is in an impasse; more and more regional trading and economic blocs are being formed; and countries are moving away from the dollar and the euro and from the IMF and the World Bank in favor of regional development banks.

The U.S. is trying hard to push through the Trans-Pacific Partnership (TPP), aimed to limit the growth and influence of China, and the Transatlantic trade and investment partnership (TTIP) which is intended to keep the EU in its orbit, although the TTIP is not economically advantageous to Europe, according to many experts. Those in Europe who advocate this project are driven by fear of being left without U.S. protection in the conditions of the EU's crisis and the recovery of Russia.

Earlier, in the Cold War years, the role of U.S. driving belts was played by military alliances, which have since vanished or have become almost forgotten - PATO, CENTO, SEATO, ANZUS. Now the emphasis is made on "containing" competitors using economic instruments.

De-globalization received a powerful impetus when the West used an "economic nuclear weapon" - sanctions - against a major world player, Russia. The sanctions have shown to doubters the danger of relying on Western institutions, rules, payment systems and currencies.

The new countries have seen that the old West, which created the modern globalization, is departing from it, as it benefits other countries, too. They have begun to build institutions and economic blocs of their own. One of them is being formed in Latin America which is breaking from the U.S. hegemony. Another bloc, potentially the strongest one, is emerging in continental Asia. Russia and countries gravitating towards it are among its potential members. Let's call this still nameless association a Greater Eurasia Community.

It will be formed around a renewed and expanded Shanghai Cooperation Organization (SCO). A major and potentially historic step in this direction was made in May of this year, when the leaders of Russia and China met in Moscow and agreed to integrate the Eurasian Economic Union (EEU) and the Silk Road Economic Belt initiative - China's large-scale plan to promote the economic and logistical development of western Chinese regions and countries west of China. The West tried to set the two projects in opposition to each other, but things went the other way around.

This project will no doubt be open to the EU and its members, and it can give new momentum to their slowing-down development.

In this context, a dialogue between the EU and the EEU, a belated subject of discussion among European colleagues who, after the Ukrainian crisis, seem to regret having refused to create unified economic and human spaces with Russia, is losing relevance. Perhaps, this dialogue should be conducted in a broader format, such as between the EU and a stronger and expanded SCO.

There are many territorial and other disputes in Greater Eurasia. To the south and west of the region lies the Middle East, which has for decades been torn by conflicts and which is a source of instability for other regions. The problem of European security is also hard to solve, at least within the frameworks of former parameters and institutions. But if a problem is unsolvable, one should go beyond it.

Therefore, the idea suggests a creation of a Forum for Eurasian cooperation, development and security, a kind of new "Congress of Vienna" which could try to work out new rules and regimes for the entire Eurasian continent. This should be a forum "not against" but "for" - not against the old system (let European countries wishing to stay in NATO do that) but aimed at creating a new system that would be consonant with the 21st century realities.

The success of the new "Congress of Vienna" is possible, naturally in the long term, because the world seems to be moving through tough competition to a new convergence of social and political models. The market economy, in different variants, has won almost everywhere. The new countries (let's call them leader-type, non-liberal democracies) are increasing democratic elements in their models, while most liberal democracies will increase authoritarian elements under the influence of challenges - or they will lose.

The United States' role in the proposed concept of world development is not clear. But this is a question to the American elite which itself should decide what it wants. Does it want to hide into semi-isolation, resentful at a world striving for independence, and leaving behind ruins to return later? Or does it want to cling to the "unipolar" moment which, it seems, almost no one wants to come back? Or does it want to become a responsible builder of a new, more democratic, equitable and fairer world?

Russia, with its globally minded elite, high-class diplomacy and advantageous geographical position, can actively promote the construction of such a world, a new "Concert of Nations" - to its own benefit and that of its partners.

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#16
Russia Beyond the Headlines/Rossiyskaya Gazeta
www.rbth.ru
June 5, 2015
China and Russia plan greater Eurasian integration - Expert
There was a lot of talk about a new type of partnership with Beijing at a recent conference devoted to Russia-China relations, which was organized by the Russian International Affairs Council in Moscow. Rossiyskaya Gazeta discussed the prospects of Sino-Russian cooperation with political scientist Sergei Karaganov, Dean of the Faculty of World Economics and Politics of the Higher School of Economics.
Yevgeny Shestakov, Rossiyskaya Gazeta

Rossiyskaya Gazeta: What is the new type of partnership between Russia and China, in your opinion?
 
Sergei Karaganov: I think that "new" is what has happened recently, when China and Russia agreed on the integration and coordination of two mega projects. That is China's Silk Road Economic Belt and the Eurasian Economic Union, which is led by Russia. Previously, most observers assumed that these two projects would be competing with each other. Now, everything is exactly the opposite. It is very likely that a new area of economic development will be formed in the center of Eurasia that will benefit all, and probably become the center of the new community of Grand Eurasia.
 
RG: Sometimes experts express concern that Russia could find itself to be a junior partner of China in this project.
 
SK: Such concerns exist. But I would advise those who express them not to underestimate the capabilities of Russia. Yes, we are economically lagging behind China, but so far, we are equal figures in the global arena. There are two options to be developed in parallel to continue to maintain parity between Russia and China. The first and most important is that Russia must drastically change its economic policy, achieving growth, especially in those sectors where we are really competitive, and direct it to the East. The second direction is that there must be other strong players in the Eurasian project like India, Iran and other countries in the region.
 
RG: Should Russia take part in the creation of this new financial system together with China?
 
SK: Absolutely. Of course, we will continue to work in the old system as well, but the emergence of parallel development banks, parallel reserve currencies and parallel payment systems - all this is advantageous to Russia. They extend the scope of Russia's flexibility and make the country's policies more autonomous and independent.
 
RG: There is a lot of talk today about the development of energy cooperation between Russia and China. But how is this cooperation different from what already exists, for instance between China and Saudi Arabia, Iran or African states?
 
SK: As any responsible country, China, of course, is interested in diversifying external sources of energy supply. This is a perfectly normal and reasonable strategy. As for the differences, there is one and it is very essential. Supplies from Africa or from the Middle East are extremely vulnerable. The Chinese are well aware of this. All these supplies are delivered by the sea, but the sea is now dominated by the United States and will be in the near future. Therefore, there is the theoretical possibility of an interruption of supplies or the threat of interruption. Continental energy supplies do not carry such threats.
 
RG: China has been actively buying up companies in Western Europe, the United States and in other part of the world. Should we be afraid of this kind of economic expansion?
 
SK: China has a huge surplus of capital. Now it turns out that these savings are vulnerable. It is possible that sooner or later the United States will go to the devaluation of the dollar to depreciate its own debt, among other things. In this situation, the Chinese are trying to get assets instead of money. This is quite a reasonable philosophy and one should use it to their advantage.
 
Unfortunately, there is a stereotype left over from the past years in Russia, when we see only danger, but do not want to see the possibilities. The presence of a large neighbor, such as China, will bring, first of all, a tremendous opportunity for Russia.
 
This interview has been condensed and edited for clarity. First published in Russian by Rossiyskaya Gazeta.

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 #17
Moscow Times
June 8, 2015
Russia Pivots East, Or Does It?
By Ian Ivory
Ian Ivory is a corporate finance specialist and partner at Goltsblat BLP.

Anyone reading the Western business press recently would be forgiven for thinking that Russia's global trading relations are irreversibly shifting East. Russian business ties with the West are severed, sanctioned and broken. Asian players are set to step in and fill the gaps left by retreating Western investment.

Certainly the recent spate of announcements supports such a proposition. This month Gazprom said that the China National Petroleum Corporation (CNPC) had started construction of the Chinese section of the pipeline to receive Russian gas, following the signing of a $400 billion gas deal last year to build the Power of Siberia pipeline.

In addition, Chinese e-commerce giant Alibaba has opened a new office in Russia to "further expand [its] business and to facilitate interaction with Russian government agencies."

To top it off, the two countries have also signed several economic deals, as well as a financing agreement for up to $25 billion for Russian companies from Chinese banks. "Today, China is our key strategic partner," Putin said, seated alongside his Chinese counterpart Xi Jinping, as the deals were signed.

Nonetheless, a high level of skepticism remains in many business circles, including Russian ones, as to how real or achievable this pivot East really is, at least in the short to medium term.

There is no getting away from the reality that Europe will remain Russia's largest overall trading partner for years to come. U.S. trade with Russia is much lower, but even so, the U.S. remains Russia's single largest foreign direct investor for infrastructure and power projects.

When speaking to bankers and professional advisers in Moscow, Beijing and Shanghai, there is a large element of wait-and-see about the realistic levels of cooperation that might emanate from Russian-Asian business cooperation over the next few years.

Setting political rhetoric aside, Russia's motivations are not hard to follow. Recent geopolitical events have brought into sharp focus the inherent risks in its current energy trading set-up. Europe (and particularly Germany) are fearful that Russia will turn off the gas, but likewise Russia is all too aware that Europe could turn off the flow of money.

Realistically, Russia is not looking to replace Europe as a trade partner and energy consumer, but to diversify its customer and supply base. In addition, sanctions are markedly squeezing the availability of financing and capital and the need to obtain this from alternative sources is real and pressing.

Political relations between Russia and the West are not easy, but big business is far more dispassionate and financially motivated. Russia remains an important market for many Western companies. In 2007-08 during the (previously) lowest point of post-Cold War international relations between Russia and Britain, bilateral trade between the two countries actually increased, so history suggests all may not be lost for business ties.

Moreover, we cannot forget that Russia does not just need capital investment, but also technical support, equipment and expertise in order to diversify its economy, enable newly promoted "import substitutions" and boost development - and, at the moment, this assistance will mostly be available from Western companies, subject as always to mutually acceptable terms as well as now, of course, the impact of sanctions.

This cooperation and expertise remains vital for economic development and diversification and is not so easily replaced by a pivot East - at least not immediately. Sanctions are seemingly set to stay in place for some time to come, but it may not all be Europe's loss and Asia's gain in relations with Russia.

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 #18
US missiles in Europe might add chill to new edition of Cold War
By Lyudmila Alexandrova

MOSCOW, June 5. /TASS/. US threats to deploy in Europe its intermediate range missiles targeted at Russia's nuclear potential in response to Moscow's alleged violation of the 1987 treaty that eliminated intermediate and shorter range missiles (INF) can for the time being be seen as another in a series of unfriendly gestures that were so frequent of late, Russian experts say. However, in the longer term this threat may materialize to trigger a nuclear escalation and put the world on the brink of a disaster.

Washington is considering the possibility of deploying in Europe its ground-based missiles targeted at Russia's nuclear potential, says a report by the Chairman of the Joint Chiefs of Staff, General Michael Dempsey. Associated Press says the United States presents these measures as retaliation to Russia's alleged breach of certain terms of the INF treaty.

The 1987 treaty envisaged the elimination of all Soviet and US intermediate and shorter range missiles. By 1991 the treaty had been implemented, and mutual inspections continued up to 2001. Last summer the United States accused Russia of non-compliance. Russia dismissed the US charges as groundless.

The possibility of deploying missiles in Europe should not be brushed off altogether, although at this point the possibility still looks slim," expert Vasily Kashin, of the Centre of Analysis of Strategies and Technologies, told TASS. "Even if one leaves aside the general spirit of confrontation the Americans increasingly see the INF as an obstacle and might use this pretext for quitting the treaty," he said.

In that case the United States will in the first place seek to place the missiles in countries around China, because the Americans find China's growing military potential ever more worrisome, Kashin said. As for Europe, theoretically the missiles may be stationed in Poland and the Baltic countries. If that happens, Russia will have to retaliate.

All ballistic intermediate range missiles, which were the most dangerous component of confrontation in Europe, were eliminated under the treaty. Neither the United States nor Russia has them anymore, and restarting their production would take years," Kashin said. The INF treaty also outlawed land-based cruise missiles, but did not prohibit air and sea-launched ones. Theoretically, these can be easily altered for use on the ground.

If it really withdraws from the INF treaty, the United States may first deploy cruise missiles and then start developing new intermediate range ballistic missiles," he said. "At this point this is still a threat, but if the standoff gets worse and escalates, we may see that as early as next year. That will add much chill to another edition of the Cold War. The deployment of missiles would bring about a nuclear escalation fraught with a still greater threat than the one that existed in the Soviet era.

For the time being the deployment of US missiles is a theme for political speculations, the editor-in-chief of the Arsenal Otechestva (Arsenal of Fatherland) magazine, Viktor Murakhovsky, has told TASS. "The United States already has some weapon systems to which the INF treaty applies and it makes no bones about that. In particular, he pointed to US drones Predator armed with Hellfire missiles.

Many foreign experts agree that there is no big difference between drones and cruise missiles. Russia stated that quite clearly to declare the United States itself was responsible for breaching the INF treaty.

Also, Murakhovsky said US ships carrying cruise missiles were permanently present in the Baltic Sea and from time to time they enter the Black Sea.
"In fact, the treaty does not work already now," he believes. "And attempts are being made to put the blame at Russia's door."

Russia has never created the slightest pretext for being accused of violating the INF treaty, says the deputy chief of the international security department at the Russian Academy of Sciences' Institute of Europe, Dmitry Danilov.

"At the moment it still looks like a threat and just does not fit in with the logic of worsening relations. But in fact the United States is shaking loose the INF treaty's regimen, and the consequences of that may be very grave," he told TASS.

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 #19
With eye on U.S. election, Republicans assail Russia's Putin
By Steve Holland

WASHINGTON, June 8 (Reuters) - Something about Vladimir Putin makes Republicans in the U.S. presidential race see red.

The Russian president has emerged as a symbol for what they view as President Barack Obama's weak foreign policy, and an easy route for criticizing his former secretary of state, Hillary Clinton, the Democrats' likely choice for the November 2016 election.

With his bare-chested swagger and wily geopolitical moves, Putin is an easy target, the man whose aggression against Ukraine and annexation of Crimea have revived Cold War tensions that Republicans credit their hero, President Ronald Reagan, with having ended in the 1980s.

"What Putin is trying to do is market the strongman concept," Republican presidential candidate Lindsey Graham, a U.S. senator from South Carolina, told Reuters. "He has a brand and his brand is to be in your face and say, 'We're not going to be pushed around by the West.'"

No leader abroad draws more Republican criticism than Putin does. The candidates' message is clear: If any of them are elected president, U.S. relations with Russia will turn even more negative.

"I think it will resonate with Republican voters," said David Yepsen, director of the Paul Simon Public Policy Institute at Southern Illinois University. "There's real concern about what Putin is really up to."

It helps them that the 62-year-old former KGB officer is deeply unpopular in the United States. A survey by the non-partisan Pew Research Center in February said Putin was viewed unfavorably by 70 percent of Americans.

Foreign policy does not always figure prominently in U.S. presidential elections. The quadrennial vote often hinges on the health of the U.S. economy. Republicans this time have seized on the daily drumbeat of news around the world: Islamic State beheadings in the Middle East, Chinese claims to disputed waters, Russia flexing its muscles.

Given the turbulent state of affairs, Republicans believe the "Putin as boogeyman" theme serves well as a way to rally the party's base of supporters.

In Moscow, Kremlin spokesman Dmitry Peskov said Putin could take the heat so long as the criticism did not go "beyond the limits of what is reasonable, if it's not an insult."

"Unfortunately, for probably the whole of modern history we have seen bilateral Russian-American relations being made a sacrifice on the altar of the election campaign, and being used as one of the tools of the campaign," Peskov said.

'TWITCH A LITTLE'

Jeb Bush, soon to announce his presidential campaign, says he would like to make Putin "twitch a little." He will reinforce his message of a more strident foreign policy toward Russia on a trip this week to Germany, Poland and Estonia.

Another candidate, former Hewlett-Packard Co Chief Executive Carly Fiorina, calls Putin a "bad dude." She boasts of having sat face-to-face with Putin in 2001 to bolster her claim to having foreign policy chops.

Putin was the only leader outside the United States that former Texas Governor Rick Perry mentioned in his presidential candidacy announcement speech on Thursday.

"Vladimir Putin uses energy to hold our allies hostage," he said. "If energy is going to be used as a weapon, I say America must have the largest arsenal."

Republicans link their criticism of Putin to the foreign policy record of Clinton, who as the chief U.S. diplomat carried out Obama's "reset" in relations with Moscow in 2009, soon after Obama succeeded George W. Bush as president. They say Obama and Clinton eased up on Putin when they should have applied more pressure.

"She's the one that literally brought the reset button to the Kremlin," Perry said in April.

Republican candidates generally favor increasing economic sanctions on Russia, sending arms and economic aid to Ukraine, boosting NATO defenses, especially in Poland and the Baltics, and increasing U.S. exports of natural gas to ease European dependence on Russian gas.

Obama has imposed a series of sanctions on Moscow in coordination with European allies, but he has stopped short of massive retaliation out of respect for European concerns that being too tough could trigger Putin's retaliation.

Relations with Russia were strained under President Bush, but Putin's actions and the reactions of Obama and Europe have brought about the worst East-West tensions since the Cold War. Nothing has worked to dissuade Putin, who seems indifferent, bemused and perhaps even politically invigorated by the denunciation from the West.

"The president is afraid of provoking Vladimir Putin," Senator John McCain, the 2008 Republican presidential nominee, told Reuters. "Vladimir Putin is on the move because he has paid no price for his aggression."

Campaign foreign policy advisers say Putin is singled out as a way of separating him from the Russian people, who may or may not share their leader's world view.

"It is better to tactically single him out than to blame 'nasty Russian policy,'" said John Herbst, a former U.S. ambassador to Ukraine who informally advises Republican candidates. "That way you don't have to alienate the whole country."

Michael McFaul, who was Obama's first-term U.S. ambassador to Russia, said the Republican argument is faulty in that the reset led to some tangible benefits: A new nuclear arms control treaty, sanctions on Iran, the opening of supply routes for U.S. forces in Afghanistan.

Having said that, however, he said that singling out Putin for criticism is justified because Russia took its aggressive turn when Putin returned as president in 2012, succeeding Dmitry Medvedev.

"We had a period of cooperation with the Russians several years ago," McFaul said. "We're now in arguably one of the most confrontational periods we've been in since deep in the Cold War."

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 #20
www.rt.com
June 8, 2015
Russia has better things to do than start WW3
By Bryan MacDonald
Bryan MacDonald is an Irish writer and commentator focusing on Russia and its hinterlands and international geo-politics. Follow him on Facebook

Vladimir Putin said this weekend that "Russia would attack NATO only in a mad person's dream." Unfortunately, there are a lot of mad people working in western politics and media.

If the G7 were based on GDP, adjusted for purchasing power, it would be comprised of the USA, China, India, Japan, Russia, Germany and Brazil. Such a lineup would have remarkable clout. Members would boast 53% of the globe's entire GDP and the planet's 3 genuine military superpowers would be represented.

The problem for Washington is that this putative G7 might actually be a forum for a real debate about the world order.

Instead of a real G7, we have a farce. An American dominated talking shop where the US President allows 'friendly' foreign leaders to tickle his belly for a couple of days. There is no dissent. Washington's dominance goes unquestioned and everyone has a jolly time. Especially since they kicked out Russia last year - Vladimir Putin was the only guest who challenged the consensus.

However, the problem is that this 'convenient' G7 is way past its sell-by-date. The days when its members could claim to rule the world economically are as distant as the era of Grunge and Britpop. Today, the G7 can claim a mere 32% of the global GDP pie. Instead of heavyweights like China and India, we have middling nations such as Canada and Italy, the latter an economic basket case. Canada's GDP is barely more than that of crisis-ridden Spain and below that of Mexico and Indonesia.

Yet, the Prime Minister of this relative non-entity, Stephen Harper, was strutting around Bavaria all weekend with the confidence of a man who believed his opinion mattered a great deal. Of course, Harper won't pressure Obama. Rather, he prefers to - metaphorically - kiss the ring and croon from the same hymn sheet as his southern master.

NATO and the G7 - 2 sides of 1 coin?

There was lots of talk of "Russian aggression" at the G7. This was hardly a surprise given that 6 of the 7 are also members of NATO, another body at which they can tug Washington's forelock with gay abandon. Obama was at it, David Cameron parroted his guru's feelings and Harper was effectively calling for regime change in Russia. It apparently never occurred to the trio that resolving their issues with Russia might be easier if Putin had been in Bavaria? The knee-jerk reaction to remove Russia from the club was hardly conducive to dialogue.

Meanwhile, Matteo Renzi stayed fairly quiet. It has been widely reported that the Italian Prime Minister privately opposes the EU's anti-Russia sanctions due to the effects on Italy's struggling economy. Also, Renzi's next task after the G7 summit is to welcome Putin to Rome.

With that visit in mind, Putin gave an interview to Italy's Il Corriere della Sera where he essentially answered the questions that Obama, Cameron and Harper could have asked him if they hadn't thrown their toys out of the pram and excluded Russia from the old G8. Putin stressed that one should not take the ongoing "Russian aggression" scaremongering in the West seriously, as a global military conflict is unimaginable in the modern world. The Russian President also, fairly bluntly, stated that "we have better things to be doing" (than starting World War 3).

Putin also touched on a point many rational commentators have continuously made. "Certain countries could be deliberately nurturing such fears," he added, saying that hypothetically the US could need an external threat to maintain its leadership in the Atlantic community. "Iran is clearly not very scary or big enough" for this, Putin noted with irony.

A world of 'goodies' and 'baddies'

For Washington to maintain its huge military spending, it has to keep its citizens in a state of high alarm. Otherwise, they might insist that some of the armed forces' cash is diverted to more productive things like hospitals and schools. These services, of course, are not very profitable for weapons manufacturers or useful for newspaper and TV editors looking for an intimidating narrative.

Following the collapse of the USSR, Russia was too weak and troubled to be a plausible enemy. Aside from its nuclear arsenal - the deployment of which would only mean mutual destruction - the bear's humbled military was not a credible threat. Instead, the focus of warmonger's venom shifted to the Middle East and the Balkans, where Saddam Hussein, Muammar Gaddafi, Slobodan Milosevic and Osama Bin Laden kept the general public's attention occupied for roughly a decade and a half. However, they are now all dead and pro-war propaganda needs a new bad guy to play the Joker to America's Batman.

Kim Jong-un looked promising for a while. Nevertheless, the problem here is that North Korea is too unpredictable and could very feasibly retaliate to provocations. Such a reaction could lead to a nuclear attack on Seoul, for instance, or draw Washington into a conflict with China. Even for neocons, this is too risky. Another candidate was Syria's Basher Al-Assad. Unfortunately, for the sabre rattlers, just as they imagined they had Damascus in their sights, Putin kyboshed their plan. This made Putin the devil as far as neocons are concerned and they duly trained their guns in his direction.

Russia - a Middle East/North Africa battleground?

In the media, it is noticeable how many neocon hacks have suddenly metamorphosed from Syria 'experts' into Russia analysts in the past 2 years. Panda's Mark Ames (formerly of Moscow's eXILE) highlighted this strange phenomenon in an excellent recent piece. Ames focused on the strange case of Michael Weiss, a New York activist who edits the anti-Russia Interpreter magazine (which is actually a blog). The Interpreter is allegedly controlled by Mikhail Khodorkovsky and a shadowy foundation called Herzen (not the original Amsterdam-based Herzen) of which no information is publicly available.

Weiss was a long-time Middle East analyst, who promoted US intervention to oust Assad. Suddenly, shortly before the initial Maidan disturbances in Kiev, he re-invented himself as a Russia and Ukraine 'expert,' appearing all over the US media (from CNN to Politico and The Daily Beast) to deliver his 'wisdom.' This is despite the fact that he appears to know very little about Russia and has never lived there. The managing editor of The Interpreter is a gentleman named James Miller, who uses the Twitter handle @millerMENA (MENA means Middle East, North Africa). Having been to both, I can assure you that Russia and North Africa have very little in common.

Weiss and Miller are by no means unusual. Pro-War, neocon activists have made Russia their bete noir since their Syria dreams were strangled in infancy. While most are harmless enough, this pair wields considerable influence in the US media. Naturally, this is dressed up as concern for Ukraine. In reality, they care about Ukraine to about the same extent that a carnivore worries about hurting the feelings of his dinner.

Russia's military policy is "not global, offensive, or aggressive," Putin stressed, adding that Russia has "virtually no bases abroad," and the few that do exist are remnants of its Soviet past. Meanwhile, it would take only 17 minutes for missiles launched from US submarines on permanent alert off Norway's coast to reach Moscow, Putin said, noting that this fact is somehow not labeled as "aggression" in the media.

Decline of the Balts

Another ongoing problem is the Baltic States. These 3 countries have been unmitigated disasters since independence, shedding people at alarming rates. Estonia's population has fallen by 16% in the past 25 years, Latvia's by 25% and Lithuania's by an astonishing 32%. Political leaders in these nations use the imaginary 'Russian threat' as a means to distract from their own economic failings and corruption. They constantly badger America for military support which further antagonizes the Kremlin, which in turn perceives that NATO is increasing its presence on Russia's western border. This is the same frontier from which both Napoleon and Hitler invaded and Russians are, understandably, paranoid about it.

The simple fact is that Russia has no need for the Baltic States. Also, even if Moscow did harbor dreams of invading them, the cost of subduing them would be too great. As Russia and the US learned in Afghanistan and America in Iraq also, in the 21st century it is more-or-less impossible to occupy a population who don't want to be occupied. The notion that Russia would sacrifice its hard-won economic and social progress to invade Kaunas is, frankly, absurd.

The reunification of Crimea with Russia is often used as a 'sign' that the Kremlin wishes to restore the Soviet/Tsarist Empire. This is nonsense. The vast majority of Crimean people wished to return to Russia and revoke Nikita Khrushchev's harebrained transfer of the territory to Ukraine. Not even the craziest Russian nationalist believes that most denizens of Riga or Tallinn wish to become Russian citizens.

Putin recalled that it was French President Charles de Gaulle who first voiced the need to establish a "common economic space stretching from Lisbon to Vladivostok." As NATO doubles down on its campaign against Moscow, that dream has never looked as far off.

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#21
The National Interest
June 5, 2015
Can U.S.-Russia Relations Be Repaired?
By Jacob Heilbrunn
Jacob Heilbrunn is editor of The National Interest.

When NATO expansion was promoted by the Clinton administration in the 1990s, George F. Kennan warned that it would inevitably antagonize Russia and lead to a new era of tension between East and West. Today, in the wake of Russia's annexation of Crimea and rising tensions between Washington and Moscow, his prediction seems as though it's being fulfilled. The echoes of Cold War confrontation are resounding in both capitals.

Enter the newly formed American Committee for East-West Accord, a nonpartisan organization that seeks to promote what amounts to a new détente with Russia. Its name quite deliberately evokes the Committee on East-West Accord, which was founded in 1974 to champion détente and included George F. Kennan among its members. Today's committee includes former senator Bill Bradley, former ambassador William J. vanden Heuvel, former ambassador Jack F. Matlock, Jr. and the scholar Stephen F. Cohen.

The committee says it hopes to encourage a vigorous debate about Russia. It also calls, among other things, upon Moscow and Washington to restore cooperation on the 1991 Nunn-Lugar Cooperative Threat Reduction Program and for the United States, NATO and Russia to reactivate the NATO-Russia Council. In its mission statement, the committee warns, "While experts warn of an unfolding new nuclear arms race, and with it the risk those weapons may actually be used, there may already be less East-West cooperation than existed during the latter decades of the preceding cold war."

The very existence of the committee underscores the extent to which U.S.-Russia relations have gone back to the future. Only a decade ago, it would have seemed improbable that relations would deteriorate as much as they have. In the most recent issue of the National Interest, Graham Allison and Dimitri K. Simes meticulously analyze the anfractuosities of this contentious relationship. They caution that both sides could be inadvertently "stumbling" to war.

They conclude,

"To recognize the potentially catastrophic consequences of war with Russia does not require paralysis in addressing the challenge of a resurgent but wounded Russia. The United States has a vital interest in maintaining its credibility as a superpower and in assuring the survival and security of its NATO alliance-and thus of every one of its NATO allies. Moreover, in international politics, appetites can grow quickly if fed by easy victories."

The Russian president's currently limited objectives in Ukraine could become more expansive if Russia does not face serious resistance. After all, the smooth annexation of Crimea led to an outburst of triumphalist rhetoric in Moscow about creating a new entity, Novorossiya, which would include eastern and southern Ukraine all the way to the Romanian border. The combination of resistance by local populations, the Ukrainian government's willingness to fight for its territory, and U.S. and EU sanctions quickly persuaded the Russian leadership to curtail this line of thinking. When a nation is prepared to fight for important interests, clarity about that determination is a virtue in discouraging potential aggression.

Yet the United States should be careful to avoid giving allies or friends-like Kiev-the sense that they have a blank check in confronting Moscow.

In the forthcoming issue of the National Interest, Council on Foreign Relations president emeritus Leslie H. Gelb is featured in a cover story that adds an important perspective on the U.S.-Russia dynamic. He calls for a sober policy of "détente plus," in which each Russia is not treated "as an enemy, but as combination of adversary and partner." The coming year will reveal whether a new rapprochement is effected or whether relations will continue to deteriorate.

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 #22
PONARS Eurasia
www.ponarseurasia.org
June 5, 2015
To Thomas Graham: We Should Understand Russian History Differently
By Ivan Kurilla
Professor of History Volgograd State University

In a recent Financial Times op-ed ("Europe's Problem is with Russia, not Putin") Thomas Graham, a managing director at Kissinger Associates and former senior director for Russia on the US National Security Council, makes far-reaching conclusions about contemporary Russia and international security by drawing on the position Russia held in the world in the 19th century. As an historian of that era, I cannot agree with Mr. Graham's assumptions.

I agree with Mr. Graham that the recent policies of Russia toward Ukraine are in violation of international norms and pose a challenge to European security. Moreover, I agree that a certain "accommodation" of Russia by the West should be part of the solution.

However, his sweeping generalizations about Russian policies and Russia as an unchangeable nation lead to erroneous conclusions.

To begin with, even just using the words "Russia problem" brings to mind British propaganda from the 1830-50s, when Anglo-Russian competition between empires was at its peak. In that rivalry, the United States was definitely on the Russian side. The United States was highly critical of the hypocrisy of the English press, and supported Russia in its Crimean war (1853-1856) against European nations.

Furthermore, it is incorrect to define the 19th century ideological struggle by saying that "Russia maintained an autocratic regime as Europe moved towards liberal democracy." Yes, Russia was the leading autocratic power in Europe, but the majority of European states were monarchies, sometimes very autocratic. Were monarchic Austria, Prussia, and, later, Germany moving toward liberal democracy?

There was some movement toward liberal principles in Europe, and Russia was part of it. During the Great Reforms of the 1860-70s, Russia abolished serfdom-two years earlier than the United States emancipated its slaves. Russia introduced self-governing localities, trial by jury, army and state apparatus reform, all in accordance with the liberal outlook of the age. Some of Russia's reforms even overtook the progress of its Western neighbors.

It is very schematic to see Europe in the 19th century as a political or even civilizational unit making a choice between an "American type" liberal democracy or a "Russian type" autocracy. But even within such a scheme, Russia remained (and remains) a vital part of European civilization. We can see it as representing a pole of European ideology. So it is untrue to position Russia as "alien in worldview" to Europe. Russia, at least since the early 18th century, was integral to European dialogue, not an external challenger.

The phrase "European states seek security in balance; Russia seeks it in strategic depth" is also troubling and incorrect. First, Russia was always a part of a European balance. It was impossible to counter Napoleon in the 19th century or Hitler in the 20th without Russian participation in the coalitions against them. In fact, Mr. Graham contradicts his own thesis when he writes, "Russia has opposed the domination of Europe by a single power and remains uncomfortable with greater European unity." It is here that we see the nature of Russia in any historical European coalition.

This aspect of Mr. Graham's article calls to mind the "revisionist" historians' critique of the U.S. foreign policy tradition that, according to historian Walter LaFeber, could base its security on dominance alone, as opposed to a balance of power as developed in Europe. It was Europe that developed the "concert of Europe" as a tool to contain any pretender for hegemony, while the U.S. established its hegemony on the American continent.

In addition, the author's line about "resistance from the Germanic powers in the west, Great Britain and then the US in the south" sounds, quite frankly, a bit strange to any historian. It was Germany that started two world wars and invaded Russia, not vice versa. And what exactly did Great Britain and the United States do "in the south" of Russia? Looking at a map, it might be the case, at least for the British Empire, that it wanted to push, in the author's words, "its borders outward, as far away as possible from its heartland."

Finally, the author's depiction of Russia as a "nearly featureless great Eurasian plain" sounds rather naïve-like descriptions people used to use in the 19th century, before they knew any better.

While I cannot agree with the historical arguments Mr. Graham uses, I support his call for future accommodation of Russia. "Accommodation" does not imply acceptance of Putin's policies (as one response to Mr. Graham's op-ed puts it) but an effort to find a lasting solution to the security and integration dilemmas that plague relations between Russia and the West. Painting Russia as essentially anti-Western and dangerous only helps to maintain fear and perpetual conflict. Searching for ways to "accommodate" Russia in the world community, drawing from Russia's rich history of alliances and cooperation, would be more prudent.

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 #23
Wall Street Journal
June 6, 2015
Defense Chief: Subversion, 'Big Lie' Are in Russia's Arsenal
Ash Carter favors more military exercises, better intelligence sharing
By GORDON LUBOLD

During his confirmation hearing earlier this year, Ash Carter left open the idea of arming the Ukrainian military with weapons it needs to defend the nation against Russia.

As U.S. secretary of defense, Mr. Carter hasn't made any public recommendations concerning arms, though the option is still being assessed, a senior defense official said this week.

But Mr. Carter made clear at the end of an 11-day overseas trip that he believes more must be done to change Moscow's behavior in Eastern Europe after it moved to annex the region of Crimea from Ukraine and backed a violent civil war.

"It's a mixture of subversion and sophisticated threat making, manipulation of information, the big lie-all this cocktail that we saw in Ukraine," Mr. Carter said.

He favors more military exercises, better intelligence sharing among countries and more resources for the region, saying Russian aggression would be "an enduring challenge."

His comments came after he held a meeting in Germany with top Defense and State Department planners and officers to discuss approaches to U.S. policy in Ukraine and the larger region as fighting broke out again in eastern Ukraine.

President Barack Obama and leaders of other member countries of the Group of Seven nations are meeting in Germany beginning Sunday, with Russia and the Ukraine crisis at the top of their agenda.

At the same time, officials have said that the discussions within the administration are examining options to more assertively deter Russia from objectionable policies in its region.

Economic sanctions, Mr. Carter said, have had an impact on the Russian economy but aren't altering Russian President Vladimir Putin's conduct.

Mr. Carter didn't prescribe specific options to alter existing U.S. policy in Europe or discuss recommendations he might make to the White House.

But he suggested there may be ways to sharpen existing policy to make it more effective, by helping partner nations to develop better intelligence-sharing capabilities and by encouraging them to invest more in increasing their own military capabilities.

In many ways, the U.S. can help by sharing more of its own assets and know-how, like advanced surveillance and cybercapabilities, he said. Mr. Carter also thinks the North Atlantic Treaty Organization must learn to "walk and chew gum at the same time"-by responding faster and more effectively should Moscow act again.

Mr. Putin said in an interview with an Italian newspaper published Saturday that he wants to see cease-fire terms implemented, but that the U.S. and West must exert greater pressure on Ukrainian officials, whom he blames for the breakdown. Moscow also has complained about U.S. military assistance to Ukraine.

The Pentagon has conducted "Operation Atlantic Resolve," a series of military exercises with nations in the region, to support those countries through training, cooperation and a show of force since last year. Mr. Carter believes more such troop rotations would be valuable.

"Our exercise and training programs, which are tremendously successful, they're tremendously popular-we need to do more of that, get more allies involved," Mr. Carter said.

Aides traveling with Mr. Carter reiterated their view that Russian aggression isn't a return of the Cold War and said that what was critical now is to adapt to Russia's tactics-using cyber, propaganda and other forms of subversion- and help other nations to do so as well.

"All these things that are being used by the Russians, we want to make sure we're prepared and investing in the right capabilities to counter those things," said another senior defense official traveling with Mr. Carter.

Part of the challenge with regard to policy to counter Russian aggression is to help nations recognize when Moscow is behind violence and instability and when it isn't. That kind of tactic is what has surprised allies in the past and been effective for Moscow.

The European Union is due to renew economic sanctions against Moscow at a meeting at the end of the month.

The summit Mr. Carter held in Germany on Friday came at the end of an around-the-world trip that focused mainly on maritime security in Southeast Asia. But the Pentagon chief changed his focus for the tail end of the trip, summoning the commanders of almost all of his geographic combatant commands, his top policy aides as well as American ambassadors to Turkey, Germany, France, Estonia, Italy, NATO, Russia and others.

Planning for the meeting began more than a month ago, but U.S. officials said it would lay the groundwork for a NATO defense meeting later this month and wasn't in response to any particular, urgent need. Fighting broke out in eastern Ukraine earlier this week despite a cease-fire agreed to earlier this year that has nonetheless been interrupted with a slew of violence.

Mr. Carter spoke to U.S. troops and their spouses at an event in Germany Thursday before Friday's meeting, responding to a question about U.S. force posture in Europe.

"It appears that Vladimir Putin is taking his country in a different direction," Mr. Carter said. "I don't think that's a good way for Russia. We have to reconsider what we're doing here in Europe, absolutely."

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#24
Washington Post
June 7, 2015
At G-7 meeting, Obama's primary task is confronting his Putin problem
By Steven Mufson
Steven Mufson covers the White House. Since joining The Post, he has covered economics, China, foreign policy and energy.

At the U.N. General Assembly meeting in September, President Obama presented his list of "new dangers" confronting the world: the Islamic State, Ebola and Russian aggression in Ukraine. He seemed not to be pulling his punches. "We believe that right makes might, that bigger nations should not be able to bully smaller ones and that people should be able to choose their own future," Obama said.

But eight months later, Secretary of State John F. Kerry was on his way to Sochi, Russia, for a rare high-level meeting with President Vladi­mir Putin that focused on issues such as limiting Iran's nuclear program and combating Islamist terrorism even as the Russian leader fanned the flames of crisis in eastern Ukraine. It was a mission that the administration had debated for months, with Obama and Vice President Biden fearing that it might be misinterpreted as an easing of the U.S. position on Ukraine.

The U.N. meeting and Kerry visit are bookends of an Obama policy on Russia that has bounced from cooperation to confrontation and eventually to compartmentalization.

The shifting strategies reflect a constant tension - between principle and pragmatism, isolation and engagement - that has made it so difficult for Obama to deal with Moscow on a series of issues without seeming to go soft on the Russia's annexation of Ukraine's Crimea region.

Those tensions come to a head this weekend in Germany, where Obama is attending a Group of Seven summit that will be consumed by Ukraine, the pending Iran nuclear deal, and the wars in Iraq and Syria. Each puts different demands on Obama's relations with Putin. On the first, Obama needs to confront Putin; and, on the latter two, progress isn't possible without, at least, tacit support from the Russian leader.

With the escalation of attacks last week by Russian-backed separatists on Ukrainian forces and the continued forward positioning of heavy artillery in violation of cease-fire agreements, Russia is leaving the G-7 leaders little choice. White House officials said that Obama would not only support existing sanctions but would also consider imposing more.

"It's important for Russia to understand that, should it continue to have further escalation in Ukraine, it could be faced with additional consequences," the deputy national security adviser, Ben Rhodes, said in a conference call with journalists Thursday.

The G-7 meeting is a symbolic moment. After the Cold War, the annual gathering of the leaders of the world's major industrial nations had added Russia and went from being known as the G-7 to the G-8 - a gesture welcoming Moscow into the wider community of nations and a tribute to the "Bill and Boris show" that featured presidents Clinton and Yeltsin.

But when Putin seized Crimea last year, that violation of international borders set off alarms throughout Europe and in the United States. When the group of world leaders met in Belgium in last June, Putin was left out.

This weekend's gathering will again revert to being the G-7, excluding Russia for only the second time in two decades. Yet, with renewed violence in eastern Ukraine, Moscow is ensuring that its absence will be palpable.

"We haven't been concerned with security in Europe in 30 years. We thought this was done," said Michael McFaul, Obama's former ambassador to Russia, "and over the last year and a half we learned that's not true."

"We're not back in the Cold War, but neither are we in the strategic partnership we have tried to establish," said Jens Stoltenberg, secretary general of NATO.

Aggressive Russian military maneuvers have galvanized Europeans, who Stoltenberg says must boost military spending. NATO - which will hold its summit next year in the Polish presidential palace's Column Hall, where the Warsaw Pact binding the Soviet Union together with its Eastern European allies was signed in 1955 - has increased military activity in countries bordering Russia. On Friday, it began a 17-nation naval exercise in northern Europe's Baltic Sea, and starting Tuesday in Poland, it will launch a 10-day deployment test for the alliance's new quick-reaction force.

The United States is also rotating more forces through the Baltic states and Poland.

For the most part, though, what was an acute crisis last year has settled into a frozen conflict, at best, testing U.S. and European resolve to maintain - or toughen - economic sanctions. Russia has tried wooing the Czech president and the leaders of Hungary and Greece, but German Chancellor Angela Merkel has led the push for keeping costly sanctions in place as long as Russia fails to abide by the terms of the Minsk cease-fire agreement.

The crisis in Ukraine also has forced the Obama administration to reexamine its Russia policy that began six years ago with an optimistic "reset" and that has become one in which the two leaders no longer speak to each other.

For months, an interagency policy review has wrestled with issues such as whether Russia should be seen as a global or regional power and whether the United States should send lethal weapons to Ukraine. It also has grappled with how to compartmentalize topics such as Iran, terrorism and the Islamic State, on which the United States might choose to continue cooperating with Russia even as it confronts the country.

The Obama administration even struggled for weeks over how to describe the forces fighting the government in eastern Ukraine, a senior administration official said. In the end, the administration stopped calling them Russian-backed separatists and started calling them "combined Russian-separatist forces" - an effort to shame Russia publicly into changing its behavior rather than hoping to keep Russia's direct involvement quiet and letting Putin choose a face-saving exit.

Obama shows little inclination to talk to Putin himself; even before the Ukraine crisis, Obama canceled a visit to Moscow in 2013 after Russia granted asylum to Edward Snowden, who revealed classified secrets about the National Security Agency's far-reaching surveillance program.

But current and former White House officials say that Obama has been intimately engaged in U.S.-Russia relations. He helped negotiate details in the telemetry chapter of the Strategic Arms Reduction Treaty, or START, when Dmitry Medvedev was Russia's president. Last fall, he disagreed with senior Democratic Party experts on Russia - including former deputy secretary of state Strobe Talbott, Biden and former national security adviser Zbigniew Brzezinski - who over dinner at the White House urged Obama to send lethal arms, such as antitank weapons, to Ukraine to raise the conflict's cost to Russia.

A former administration official said that one of the questions he has heard Obama ask on issues including Ukraine was: If it's not going to be effective, why do it?

That reasoning, along with Merkel's agreement, has stiffened his determination not to send weapons to Ukraine. Doing so, he has said, would not be enough to defeat Russian and Russian-backed forces in Ukraine, and it would only risk escalating the fighting.

Moreover, Obama tends to see Russia in terms that he laid out in a news conference at The Hague in March 2014. He called it "a regional power that is threatening some of its immediate neighbors - not out of strength but out of weakness."

But Obama also has come under criticism from some Russia experts who say that with that comment and others, he needlessly has antagonized Putin and overestimated the speed with which economic sanctions would, as Obama put it after last year's G-7 meeting, give Putin "a chance to get back into a lane of international law."

"I talked to a Russian acquaintance who said if we could get back to peaceful coexistence, that would be an improvement," said Angela Stent, a Georgetown University professor and a former State Department and National Intelligence Council official. "Peaceful coexistence" is the phrase coined by Soviet leader Nikita Khrushchev in 1953 to reduce tensions among communist and capitalist blocs.

Russia has, even during the Ukraine crisis, continued to help identify and destroy Syria's stockpiles of chemical weapons. But many Russia experts say that the Obama administration underestimated Putin's determination to fuel the Ukraine conflict, even though it was not in Russia's interest.

"He's not a chess player - he plays checkers. That's why we're surprised. We thought he was playing chess," said Derek Chollet, a former assistant secretary of defense for international security affairs who is now at the German Marshall Fund.

As the conflict in Ukraine drags on, the administration has been more ready to openly point to Russia's direct participation.

"One other effective tool that we've seen quite recently is making clear that there are Russians operating in Ukraine and that some of those Russians are being killed," Charles Kupchan, senior National Security Council director for European affairs, said in a conference call Thursday. "The presence of Russian troops in eastern Ukraine is something that the Russian government has tried to deny, but the more evidence and the more public evidence there is of that presence, the more pressure there is on Vladimir Putin."

Taking the measure of Putin has been the real center of Russia policy. When Medvedev was president, the two countries agreed on a new START, U.N. resolutions on Iran and North Korea, membership in the World Trade Organization, new supply routes to U.S. troops in Afghanistan, and economic liberalization. "We were getting big stuff done," said McFaul, the former ambassador.

But then Putin declared his candidacy to run for president again. And he condemned the U.S. and NATO air attacks on Libya, railed against what he called U.S. interference in his reelection bid and took issue with the notion of U.S. exceptionalism. Putin was particularly angered by McFaul's efforts to encourage "civil society," the people and groups independent of the government.

The last time that McFaul met Putin, during Kerry's previous visit to Moscow two years ago, Putin told Kerry that the United States was naive to think it could foster Russian opposition groups. "He was pretty blunt about it. He looked right at me," McFaul recalled. "He didn't use my name but said, 'We know what your embassy is doing here in its support for the opposition, and we don't appreciate it.'"

Yet many Russia experts say that if naivete was involved, it was the belief that Putin, who invaded Georgia when George W. Bush was president, would not seek to keep other neighboring states in Moscow's orbit.

At this point, experts say that Obama and his foreign policy team no longer hope for cooperation or democratic reform in Russia. "I think they're more concerned about Russians doing mischief, rather than a positive contribution to what we're trying to achieve," said Thomas Graham, a managing director at Kissinger Associates who was NSC director for Russia under Bush. He cited the need to keep Russia in agreement with other powers for an Iran accord.

Beyond that, though, Graham added: "There are no expectations for the relationship. They just don't want things to blow up between now and the end of the term."

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#25
Russia Insider
www.russia-insider.com
June 8, 2015
Russophobia Exists, but Overusing the Term Is Counterproductive
Those of us who express an understanding of Russia's position on Ukraine and who share an affinity for Russia need to be careful that we don't get into a habit of overusing the term Russophobia. It can't be a word that we just trumpet out at every hand's turn because it's easy. That's lazy - and in fact, it trivializes instances of genuine Russophobia.
By Danielle Ryan
Danielle Ryan is an Irish journalist and blogger. She has a degree in Business and German from Trinity College Dublin and studied political reporting at the Washington Center for Politics and Journalism in Washington, DC. Special interests: American politics and foreign policy, US-Russia relations and media bias. Her blog can be found at journalitico.com.

Triggered by the war in Ukraine, Russophobia in Western society and media has again reared its ugly head.

That's not to say it was gone before, but it is most certainly enjoying a renaissance - and it's been a revival so widespread and durable that modern anti-Russian sentiment has been compared to anti-Soviet sentiment experienced during the lowest points of the Cold War.

We see it in the renewed Western focus on Russia as a grave threat. We see it in the denigration of the Russian people as less civilized mob unable to chart their own course. We see it in the overtly personal demonization of Vladimir Putin.

It's so pervasive in fact, that merely questioning its validity causes one to be viewed with a suspicious lens. That suspicion, which sometimes verges on defamation, is manifesting itself in such a way that the author of a recent article in The Nation decried an emerging era of what he called neo-McCarthyism in American media. To inspire such a label, we must surely have reached a very low point.

In that toxic environment, there is an understandable defensive and emotional response that kicks in. But when you think about something too much - in this case Russophobia - you start seeing it everywhere. The unfortunate, but natural next step is that you then start to see it where it doesn't exist.

Those of us who express an understanding of Russia's position on Ukraine and who share an affinity for Russia need to be careful that we don't get into a habit of overusing the term Russophobia. It can't be a word that we just trumpet out at every hand's turn because it's easy. That's lazy - and in fact, it trivializes instances of genuine Russophobia.

Think of it this way: When a pathological liar wakes up one day and decides to tell the truth, no one believes him. Similarly, if you shout "Russophobia!" every time you are in disagreement with someone's analysis or understanding, you aren't going to do yourself any favors in the long run. Granted, these days it can sometimes be difficult to avoid using it, but we do need to be cognizant of the unintended consequences of its overuse.

Like it or not, there is cause for - and need for - valid critical analysis of Russia and its policies, whether internal or external.

Disagreeing with Crimea's reunification of Russia, for example, is in itself not Russophobia. That is a political stance, an opinion. It might be the wrong opinion - and I believe it is - but I'm not going to call it Russophobic.

Dismissing all criticism of Russia as Russophobia is similar in fact, to how Washington dismisses the Russian perspective on Ukraine as pure propaganda, in that they have the same effect: They stifle debate and discussion. In other words, they are argument-enders. That's Western Russophobia! End of discussion. That's Putin's propaganda! End of discussion.

In defending Russia's foreign policy, which I have frequently done, a line must be drawn between reasoned argument and hysterical over-the-top anti-Western sensationalism. They are not the same thing and those who employ the former method should not be lumped in with those who employ the latter.

An example of someone who uses the former method would be an academic like Stephen Cohen (or Richard Sakwa), while an example of the latter would be something like the Russian equivalent of Eliot Higgins of Bellingcat (i.e. tendentious, insincere, obsessive about proving a point, interested in the total ruination of one 'side' or the other etc.).

Now more than ever, deteriorating relations between Russia and the West require an intervention of thoughtful, level-headed and fair thinking. This is so desperately lacking in both the mainstream media and in political discourse - and it is extremist, all-or-nothing, with-me-or-against-me rhetoric which will lead to further deterioration.

It might be the easier option to always go for a dramatic takedown of your opponent with an argument-ender, as mentioned before, but it's really not in anyone's best interests. In fact, that kind of response can actually have exactly the opposite effect than was intended in that you convince no one of anything and end up preaching to the choir, which is ultimately useless.

I have spoken about foreign policy, but we should also look at how this relates to criticism of domestic policy within Russia, because here again, we should tread carefully.

Putin enjoys massive support from the Russian people. On many issues, foreign and domestic, he leads Russia with a clear mandate from the vast majority of its citizens. But he is not the 'perfect' president. There is no such thing.

To defend him and Russia's foreign or domestic policy, analysts, commentators or simply interested readers, are not simultaneously required to denigrate and vilify the entire political opposition. To give one example, there is an idea floating around that Russian liberals "hate" their country. While that kind of cynical tactic is not uncommon for a politician to employ, it is less common for an analyst or commentator, for the simple reason that it is not based on sound analysis.

On that point, I have to take issue with an article recently published on Russia Insider, which blanketly asserts that Russian liberals appear to "hate their own country".

While there is probably some validity to the author's admittedly interesting hypothesis where at least a few Russians are concerned, I have to disagree with such a sweeping statement about "Russian liberals" in general. In fact, I am quite sure many, if not most of them love their country. They may hold a different worldview than the average Russian and they may vehemently disagree with the policies implemented by Putin - but there's more than one way to love your country. Feeding out this idea that those who disagree with the status quo or the current government "hate" their country, is not conducive to the kind of real debate and analysis we should be having about Russia - and again, I say that as someone who has been vociferously defending Russia in the midst of a bombardment of anti-Russian sentiment.

As a kind of thought experiment, I would ask: If Russian liberals or dissidents "hate" their country across the board, does Noam Chomsky, beloved by America's critics, hate America? Or is he simply loving his country in the way he feels is appropriate?

I write a lot about Western hypocrisy, often with a sarcastic bent. By extension, I try to steer as far away from utter hypocrisy myself (while acknowledging that I have no doubt failed in that endeavor at some point, as most of us do). Put differently, we should at least make a sincere effort to practice what we preach.

Serious and balanced analysis of Russia is sorely lacking in Western journalism. We know the effects of fanatical anti-Russian bias on less informed readers; it dumbs down their understanding of Russia and presents them with a lopsided view of the world. Understanding that, our goal should not be to create a lopsided view from the other side.

As in politics, when you want to win an election, your best bet is to target the middle ground; the undecideds. Your diehard supporters are votes in the bag, but preaching to them alone is useless. They are the choir. Similarly, your diehard opponents are never going to be swayed.
It's tipping the reasonable few in the middle to your side that will deliver the victory.

Where Russia and the media are concerned, if thoughtful and reasoned analysis prevailed, we might call that a victory, too.

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 #26
Kyiv Post
June 6, 2015
Anti-gay extremists violently break up gay pride march in Kyiv; several injured, many arrests
by Stefan Huijboom

Protected by hundreds of police officers in Kyiv's Obolon district, nearly 200 persons tried on June 6 to take part in the second gay pride parade in the last three years.

But violence, almost from the start, marred the event and sent people fleeing in chaos and panic. Police broke up the gathering quickly, telling participants to leave because they could not guarantee their safety after dozens of extremists attacked the crowd and police with fireworks, fists and nails.

Several police officers and participants were injured, including one officer who suffered serious wounds after being attacked with fireworks and nail bombs.

More than 20 extremists were arrested on suspicion of violence. Others escaped, including one man who shouted "they should die!" in reference to homosexuals.

Many attackers identified themselves as part of the militant Pravy (Right) Sector. Its leader, member of parliament Dmytro Yarosh, also fields a semi-autonomous battalion in the Ukrainian army. Yarosh, in a long Facebook post on June 4, condemned equal rights for gays and pledged to stop the gathering.

At least two other members of Parliament, Svitlana Zalishchuk and Serhiy Leshchenko, attended the march along with the Swedish ambassador to Ukraine, Andreas von Beckerath, and other Western diplomats.

Zalishchuk said that some of the extremists charged the crowd of marching activists, but were blocked by cordons of police that easily numbered several hundred officers to provide security. She praised the fast police response and witnessed some of the violence.

"One of policemen was almost killed," Zalishchuk said. "He was wounded very severely in the neck."

Zalishchuk said that the march and the accompanying violence show that Ukraine still has work to do in accepting gay rights.

While Ukraine has "made great progress in the path of tolerance, which is the core of our European path," it's clear to her that only a minority of Ukrainians support equal rights for homosexuals. "It's definitely a minority, not a majority," she said, based on public comments in social networks and in conversations.

She said that she has no plans to ask colleagues in Parliament to hold public hearings that would investigate, separately from the police criminal investigation, whether Right Sector instigated the violence.

"I don't know whether they were all part of Praviy Sector,"Zalishchuk said. "They wrote that they were against it...I don't know if the instigators themselves were from Pravy Sector."

She said that the "consequences should be just" against those who committed violence and that, if Yarosh was behind the attacks, "this is unacceptable."

The march got off to a peaceful start, but for security reasons, the location remained a secret until two hours before its scheduled 11 a.m. start.

"Ukraine is Europe! We are Europe!We share European values!" activists chanted as they marched along the Dnipro River in Kyiv's Obolon District

Journalists had to gather in Kyiv's Pechersk district, where they were picked up by a bus and transported to the march.

The extremists, however, were tipped off to the location. They were waiting near the scene and threatened violence from the start.

"It's a shame to be gay. It's not normal. They are perverse!" shouted two men in front of the nearby Kyiv Golf Club complex. Police blocked these men. But one attacker injured a police officer with a powerful firecracker. The wound left a puddle of blood on the ground.

"They should all die!" said a young man, his face covered in a balaclava. He didn't want to explain why "all gays should die," but constantly repeated that "it's disgusting."

Leshchenko, a member of parliament with the Bloc of President Petro Poroshenko, wrote on Facebook that "the fate of Ukraine's European integration will be determined this weekend during Kyiv's gay pride parade."

He also vowed to introduce legislation that would ban discrimination based on someone's sexuality, a prerequisite for European Union integration.

"We are here not for a party. We're here to show to the outside world that we're human and don't want to bescared of who we are," said 20-year-old Maxim, a hair stylist, who attended the march with three of his friends. He was too afraid to give his full name as he claimed some provocateurs might hunt him down.

"It's hard to be openly gay. My parents have known it for a few months, and with my father, I no longer have any contact. There is so much violence targeted at openly gays," he explained the Kyiv Post. Quickly he pointed to the massive police force. "Is this normal? No, of course not! I hope there will be one day that Ukraine accepts Europe'smoral standards when it comes to LGBT (lesbian-gay-bisexual-transgender) rights."

The event was supposed to start at 11 a.m., but police demanded that participants leave as soon as possible under police escort because they couldn't guarantee the activists' safety if they stayed.

But even as the activists fled, anti-gay protesters gathered and clashed with police, some tackling police officers to the ground and beating them. Panic and chaos broke out, with people running through Obolon's residential areas to find a safe way out.

"Don't go to the metro stations!" yelled some police officers.

Anti-gay militants were waiting at Kyiv's Minsk metro station, the closest station to the march, to confront gay activists.

A minivan of Pravy Sektor's volunteer battalion Ukraine's Volunteer Corps was spotted on the Heroiv Stalingrad Street, one of the main roads in the Obolon district leading to the Minsk metro station.

People ran across the streets to flee as police repelled the attacks with pepper spray that struck the eyes of two attackers, who fell to the ground. Paramedics quickly arrived. One of the injured men remained defiant.

"I'm a military officer in the east. It's a shame that our country is allowing these perverts to walk the streets. It's not okay!" he yelled. He was taken away by medics, while police arrested the other one.

Kyiv's top politicians were split on the wisdom of the gathering.

President Petro Poroshenko said the march is "a constitutional right for every citizen of Ukraine." He is the first president to come out so strongly for gay rights.

Kyiv Mayor Vitali Klitschko opposed the march, fearing security concerns.

The evacuation of gay activists was poorly planned. Some searched for shelter in nearby residential buildings.

Denis Panin, a board member of Fulcrum, one of the organizations involved in the Kyiv Pride event, is hopeful for the future, despite the violence.

A gay pride parade in May 2012 was also called off because of violent threats while another march in December 2012 was also marred by attacks.

"Let's hope that every year the pride gets better and safer, and let's talk more openly about it. Ukraine is a closeted country, and it has to come out of that closet," Panin said.

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 #27
The New Yorker
June 6, 2015
The Assault on Kiev Pride
BY MASHA GESSEN

To gain admission to the March for Equality, which took place today and was the sole public, outdoor component of Kiev's Pride Week, one had to register. In order to register, one had to fill out a sizable online questionnaire and give the name and phone number of at least one person trusted by Pride organizers who could vouch for the applicant. If approved, on the morning of the planned march the applicant would receive a text message with the address of the event. These precautions were taken to insure that far-right activists who had sworn to attack the march wouldn't know where to go and so that the organizers could call every potential participant's phone in case the police failed to show up to protect the marchers. The plan for the latter eventuality turned out to be unnecessary; the precautions failed to prevent the former from happening.

Kiev Pride organizers had been in negotiations with police for a month. According to the event's executive director, Anna Sharygina, in the days leading up to the march they were meeting daily-still, the police would give no promises. They did, however, insist on a specific location for the march, near a golf club and a small gated community on the embankment of the Dnieper River on the outskirts of the city. Late into the night, the organizers were making contingency plans for "what we would do if we showed up and there were three cops there," Sharygina told me. When they showed up, they found several buses full of police in riot gear-but also a number of young men and at least one woman wearing black T-shirts with the logo of Right Sector, the ultranationalist coalition that had threatened violence.

"Right now, during the war with Moscow," the Right Sector leader Dmytro Yarosh wrote on his Facebook page on the eve of the march, we "will be forced to be distracted from other things in order to stop those who hate the family, break morals, and destroy morality and the traditional concepts of humankind." He went on to say that the West is exercising too much influence over Ukraine "in order to force them to introduce the ideology of L.G.B.T. people." Here the Right Sector seems to see eye-to-eye with the enemy in Moscow, which has long claimed that Ukraine's move westward will expand the influence of the homosexual lobby.

Many of the marchers who came on Saturday had also been at the 2013-2014 protests in Maidan Nezalezhnosti, Kiev's central square, that ultimately toppled the country's old pro-Moscow government. The right to march unassailed with a rainbow flag was part of what they felt they had won in the revolution. In Warsaw, the nearest capital city to the west, the Pride Parade will be held a week later and will, as it has for each of the last few years, draw thousands of people to an extravaganza of floats and flags that looks as much like a party as any other western Pride celebration. In Moscow, the nearest capital city to the east, an unsanctioned Pride Parade was attempted a week earlier; its participants were beaten and arrested, and two of the organizers are still serving their ten-day jail sentences. It was to underscore the march's Maidan heritage that the participants chanted one of the revolution's most popular slogans: "Human rights come first!"

Shortly before 10 A.M., about two hundred and fifty people, surrounded by roughly twice as many police and interior troops in riot gear, stood in formation and chanted for about fifteen minutes before setting off. I was among them, and no sooner did we start walking forward than the volunteer marshals in baby-blue baseball caps and crossing-guard vests told us to retreat. The police were beating back gay-bashers, some of them dressed in the Right Sector's black T-shirts and others in camouflage uniforms. The attackers were throwing flares and firecrackers, but after about a minute, all seemed safe. As more police in riot gear ran toward the front, soon-to-be marchers applauded. As the police led back the gay-bashers they had detained, some of whom screamed "Death to the faggots!" the crowd chanted, "Riot, love, and don't give up your rights!" After a few minutes, happily, the volunteers led the marchers to reassemble in groups, five people across and five people deep.

Then I noticed a group of Red Cross staffers working on a policeman who was lying on the ground. Apparently, the attackers had modified firecrackers by adding small metal fragments to them, and one had hit the man in the neck, severing his left carotid artery. He was bleeding out on the grass. It took a city ambulance about fifteen minutes to arrive. It attempted to drive down a steep set of stairs down to the embankment and got stuck. A couple of paramedics ran down with a stretcher, and no fewer than a dozen policemen carried their colleague back, one holding his hand on the man's neck to stem the bleeding. A new ambulance, from the Red Cross, had arrived by then.

The march finally began at 10:30-half an hour after the appointed time-and lasted all of ten minutes. Chanting, "Rights are not given, they are taken," we walked past a large puddle of blood. The police were now massed at the front. Behind us, they had, I was told, sealed the entrance to the embankment. But walking in the back row, I saw scores of people suddenly running after us. Had the thugs broken through the police barrier? As they got closer, I saw that all of them were holding objects up in front of their faces-cameras, tablets, and cell phones. These were journalists, who had been given a different address at which to assemble and had just been bussed in, as the last of our twenty-five rows of people was about to arrive at the end of the short route.

The organizers had been able to secure two buses-one to bring in the journalists and the other to ferry out the dignitaries-two members of parliament, the Swedish ambassador, and a few other foreigners. One of the bus companies, Sharygina told me, had told the organizers "We'll take the diplomats and the journalists but not the faggots." All the other companies they approached refused their business altogether. Sharygina spent weeks trying to organize transportation away from the site of the march, and failed. At the beginning, the volunteer marshals had instructed us, "Do not break off in singles or in pairs. Walk to surface public transportation in large groups. Do not descend into the Metro or underpasses." Now the instructions came from the golf club's security chief, a burly middle-aged man in a polyester polo shirt: "Get the fuck out of here, faggots!"

We walked away in a group of about thirty people, trailed by a dozen riot police in black. One of the Red Cross staff who had worked on the badly injured policeman was walking just ahead of me, next to Sharygina.

"A cop was injured because of you," he said.

"I am so sick of this!" Sharygina, a stout woman with a shaved head, shot back. "You are blaming the victim! We are not the ones who endangered the cops! The people who attacked them did that!"

Right around then, someone screamed, "Run!" We ran, chased by thugs, for a few minutes, through a nineteen-eighties apartment block and across a wide street.

But then the police seemed to have held back the attackers. We stopped. One of the organizers called me a cab.

"Why don't we go into a store to wait?" I asked.

"Because they are all closed," the organizer, a Maidan veteran named Maria Makarova, answered calmly.

And then there were people coming from the other direction, saying that they were running away from attackers. The thugs were now on both sides of the street. I saw a bus pulling up and ran toward it, but the driver wouldn't open the doors. Joined by several more people, I pounded on the glass, to no avail. Then a bottle whistled past my left ear and broke on the ground a few feet ahead. Our little group ran into the street and then to the other side, where a too-small clump of cops stood. An explosion sounded on the other side of the street.

"Get the fuck out of here, faggots!" The polyester-polo man was trying to push us back out into the street.

And then a bus going in the opposite direction opened its doors, and we all piled in.

Makarova, standing next to me, paid the fare. Then she calmly called to cancel the cab. Then she said, smugly, "You know, that bottle that almost hit you-that was supposed to be a Molotov cocktail too. They can't even make one right! Everyone who was really at the Maidan can make a good Molotov cocktail every time."

The fighting continued for at least an hour. Ten march participants were injured, none of them seriously. Nine policemen were injured in all, including two who were struck during the march itself-the one with the severed artery was in the hospital in serious condition. Twenty-five people had been arrested, none of them from among the marchers, and this, of all things, signalled that a new era had begun.

But the rest of Pride Week's events had to be cancelled, because of ongoing threats, because the locations had been leaked, and because, Sharygina said, "the bashers didn't get their satisfaction."

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#28
Sputnik
June 8, 2015
Poroshenko-Right Sector Rift Over 'Gay Safari' Imminent - Ukrainian Experts

Analyzing the results of Saturday's botched gay pride parade in the Ukrainian capital, Ukrainian experts have suggested that Kiev's 'gay safari', as the march was referred to by members of the Right Sector, may have become the match sparking an outright war between President Petro Poroshenko and the radical nationalist group.

In the background of an increasingly tense political and economic situation at home and the renewal of fighting in eastern Ukraine, tensions have been growing between the Ukrainian president and his erstwhile ultra-nationalist allies, the Right Sector.

Commenting on Saturday's botched gay pride parade in Kiev, which was permitted by authorities despite Right Sector vows to crush what they called an "obscene orgy," political analysts told Ukrainian news resource Vesti that the parade may have been the straw the broke the camel's back in relations between the Ukrainian government and the radical paramilitary group.

Ahead of Saturday's event, Ukrainian authorities showed uncertainty about whether the march would even be possible, with former boxer and Kiev Mayor Vitali Klitschko calling for it to be cancelled. Nevertheless, Poroshenko stood firm, saying that 'KievPride' would go ahead, and that authorities would ensure its safety. About 1,200 police officers in riot gear were dispatched to try and keep the peace, met by a group of radicals armed with baseball bats, smoke grenades and tear gas. The clashes resulted in thirty arrests and 10 injuries, nine of them police officers.

According to a source in the Ukrainian presidential administration, the march's go-ahead was not connected to any wider political strategy. "If the LGBT march had not taken place, the Right Sector would have found another reason or issue to attack us over. And they will continue to look for them," the source, speaking on condition of anonymity, told Vesti.

Citing experts, Vesti noted that the clashes resulting during the botched march were extremely favorable for the president: Poroshenko "appeared in the eyes of the West as a supporter of democratic freedoms (which is important against the background of growing criticism regarding the situation over freedom of speech) while the right radicals appear as a dark, anti-European force."

Political scientist Kost Bondarenko explained that this situation has untied Poroshenko's hand, providing him with a clear mandate from his benefactors in Washington to "deal with" the Right Sector in ways which may not be strictly legal. "In Western countries such radical organizations are dealt with in an unambiguous way, but as the promoters of democratic values, the US and the EU cannot publically support such methods. Here the situation with the LGBT march has played into Poroshenko's hands. Against such a background, the West will be willing to close its eyes to a great number of things."

Ukrainian media have been reporting ever-growing tensions between the Right Sector and Ukrainian authorities over the past few months. On Saturday, Right Sector paramilitaries conducted a loud march through the western Ukrainian city of Lviv, shouting phrases including "Poroshenko is a d***head" and "[Prime Minister Arseniy] Yatsenyuk is a d***head."

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 #29
www.rt.com
June 8, 2015
Masked attackers break up tent camp on Kiev's Maidan, protest leader 'arrested'
[Video here http://rt.com/news/265648-ukraine-maidan-camp-attacked/]

Unidentified assailants wearing balaclavas assaulted and destroyed a tent camp set up on Sunday by protesters on Kiev's landmark Maidan Square. Activists at the camp had been calling on the Ukrainian President to report on progress since taking office.

The attack happened late Sunday evening, when a gang stormed the activist camp, forcefully removing tents and dispersing protesters.

Police officers were reportedly stationed right next to the site and did nothing to stop the violent group.

The organizer of the action, Rustam Tashbaev, was arrested, RIA Novosti reported. There were also blasts heard on Institutskaya Street near the Maidan.

In Ruptly's video, assailants are seen ripping through the camp, tearing everything apart, and dragging protesters out of the tents, while they can be heard screaming in the background.

"They took me and dragged me like I was in a sleigh. I screamed, thinking they would beat me up, but they quickly dispersed. It looked like a theater production because the police were nearby and did nothing," one of the demonstrators told Ruptly video news agency.

Earlier on Sunday, about 100 protesters set up several tents on Maidan, demanding Ukrainian President Petro Poroshenko and his cabinet report on what progress has been made in implementing the reforms which were promised last year.

"We have launched this campaign, set up tents, and called this protest Maidan 3," one of the organizers, Rustam Tashbaev, told Ruptly. "We demand these people perform the duties which they are obliged to perform."

Placards at the protest read "Out with [PM Arseny] Yatsenuk and his reforms" and "I'm on hunger strike against administrative dereliction."

Activist tent sites played a major role in the Maidan protests over a year ago, which led to a government coup in Ukraine in February 2014.

The Maidan protests started in 2013 as a peaceful campaign against then-President Viktor Yanukovich's refusal to sign an EU association deal. Following the coup, the new authorities promised to undertake the political and social reforms needed to meet EU economic and democratic norms, so that Ukraine could eventually join the union.

However, progress seems to have stalled, with Poroshenko acknowledging that he is not satisfied with his achievements after one year in office.

"Whether I'm satisfied with the work of the government? I'm not. Neither with my work nor the work of Parliament. But most importantly - the people are not happy with all of us," he said speaking to lawmakers during his annual address to Parliament in Kiev on Thursday, according to The Kiev Post.

Sunday's camp event was preceded by a massive anti-government march held on Saturday in Kiev. Around 3,000 people participated in the rally, calling for the current government's resignation and economic reforms.

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 #30
Moscow Times
June 8, 2015
No Peaceful End in Sight for Ukraine, Analysts Say
By Ivan Nechepurenko

Diplomacy will be essential to ending the ongoing Ukraine conflict, but more than a year into it the key stakeholders in the crisis lack the political will to compromise with one other and to commit to a peaceful resolution, analysts told The Moscow Times amid reports of fresh fighting near Donetsk.

Following several months of relative calm, disturbed only by occasional bouts of short-lived local skirmishes, heavy artillery has been rolled out once again in the ongoing conflict between pro-Russian insurgents and Kiev's forces.

The conflict in Ukraine's east has taken a devastating toll on the region's population. It had claimed more than 6,400 lives, according to the latest figures released by the United Nations, and some 15,900 have been wounded. Much of the region's economic infrastructure has been destroyed.

The recent resurgence of violence in war-battered eastern Ukraine highlights the frailty of the internationally brokered Minsk accords. Though they may have been successful in producing a temporary respite from the fighting after they were signed in February, the accords have thus far proved incapable of offering a framework for a more fundamental resolution of the conflict.

Accusations Repeated

Predictably, when fighting flared last week, the fighters and the external stakeholders in the conflict were quick to blame each other.

Ukrainian President Petro Poroshenko claimed the rebels launched the attack with the help of the Russian armed forces, and ordered his military to prepare for a possible "full-scale" invasion by Russia along the length of their joint border.

"The concentration of Russian troops near the state border is 1 1/2 times greater than it was a year ago," Poroshenko declared during his state of the nation speech, delivered before the Ukrainian parliament on Thursday.

Igor Konashenkov, official spokesperson for Russia's Defense Ministry, quickly denied Poroshenko's claims in comments carried by the RIA Novosti news agency.

In another typical exchange, Western officials blamed Russia for the flare-up, while Moscow claimed that Kiev provoked fighting ahead of both the Group of 7 summit that got under way Sunday in Germany and the upcoming deadline for the extension of biting European sanctions against Russia.

"The Ukrainian side has taken steps to aggravate tensions many times in the past in the run-up to some major international events. ... We are seriously concerned now over the most recent manifestation of such activity," RIA Novosti cited Kremlin spokesman Dmitry Peskov as saying on Thursday.

Upon his arrival to the Bavarian Alps on Sunday, U.S. President Barack Obama said that "standing up to the Russian aggression" would be discussed at the G7 Summit.

Speaking with Italian journalists ahead of his upcoming visit to Milan, President Vladimir Putin denied that Russia is driven by a lust for aggression. He reiterated his stance that peace in Ukraine will require Kiev to to ensure the autonomous rights of the self-proclaimed rebel republics of Luhansk and Donetsk.

"The problem is that the current Kiev authorities don't even want to sit down to talks with [the leaders of the rebel republics]. And there is nothing we can do about it. Only our European and American partners can influence this situation," Putin said, noting that sanctions and threats of such against Russia won't breathe new life into the Minsk accords.

"Incidentally, the leaders of the self-proclaimed republics have publicly stated that under certain conditions - meaning the implementation of the Minsk agreements - they are ready to consider themselves part of the Ukrainian state," he said.

Amid these and other statements, the diplomatic effort to solve the crisis was undermined by the decision on Saturday of Heidi Tagliavini, the OSCE's special representative to the Minsk contact group, to step down from her role. According to sources inside the group, Tagliavini - who was praised by all sides for her role in the negotiations - left due to her disenchantment with the accords' implementation, RIA Novosti reported.

No Surprises

According to Vladimir Yevseyev, director of Moscow-based think tank the Center for Social and Political Research, given the continuous failure of the diplomatic process, it was inevitable that intense fighting would resume at some point.

"Both sides had to restore their resources and mobilize their forces," Yevseyev, who correctly predicted in March that combat in the region would pick up again in June, told The Moscow Times in a phone interview.

"What is worrying is that heavy artillery has largely returned to the same positions it occupied before the Minsk talks," he said.

One of the key provisions of the Minsk accords was the withdrawal of heavy arms by both sides. According to Yevseyev, some of that weaponry has taken the opposite route, moving closer to the front lines.

Limited Options

Mikhail Pogrebinsky, director of the Center of Political and Conflict Studies in Kiev, was likewise unsurprised by the revival of fighting.

"It is clear that Kiev does not want to talk to the insurgents, whom the leaders regularly refer to as 'terrorists.' And what do you do with terrorists?" he said in a phone interview.

According to Pogrebinsky, the only diplomatic solution to the crisis would entail democratic elections to give rise to legitimate leaderships in the rebel-held regions. These elections should be observed by European, Ukrainian and Russian polling monitors, which would pave the way for a comprehensive conflict-resolution process, he said.

"The only alternative to elections is a war of attrition, which Ukraine would likely lose," he said. "Such a scenario would be tragic."

Andrei Piontkovsky, a respected opposition-minded Moscow-based political analyst has another theory: that Putin offered the West the option of freezing the Ukraine conflict, but to no avail.

"Putin proposed the option of a peaceful coexistence with the West. Russia would keep Crimea, but would refrain from further expansion into Ukraine," said Piontkovsky, who based his speculation on the talks between Putin, Foreign Minister Sergei Lavrov and U.S. Secretary of State John Kerry held last month in Sochi.

"It is clear that this offer was rejected and now Putin has no choice but to escalate the situation," he said in a phone interview.

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 #31
Russia Beyond the Headlines
www.rbth.ru
June 5, 2015
Accusations fly as clashes in Donbass threaten to reignite war
Fresh fighting in the outskirts of Donetsk has seen the situation in eastern Ukraine sharply deteriorate over the last two days, with the neighborhood of Maryinka witnessing fierce clashes involving heavy weapons. While the two sides have blamed each other for the outbreak of hostilities, Russian observers claim it to be a provocation and say that the Minsk agreements are being threatened.
Alexey Timofeychev, RBTH

The situation in the Donbass region of eastern Ukraine once more appears to be on the verge of breaking out into open conflict following intense clashes on the western fringes of the rebel stronghold of Donetsk.

The fighting, which took place on June 3 in Maryinka, a government-held city lying adjacent to Donetsk, was the most serious since February this year when heavy clashes took place around the strategic railway junction of Debaltsevo. Despite the cessation of the active phase of the confrontation in the Donbass, experts do not exclude a new explosion of violence with the potential to undermine the peace process.

After the clashes in Maryinka the self-proclaimed Donetsk People's Republic (DNR) reported that 21 of its fighters had died and 124 were wounded. There were also casualties among the civilian population: five dead and 38 wounded. The Ukrainian side cited five dead and almost 40 wounded.
 
Reciprocal accusations

As has become customary in the conflict, the two sides accused each other of having started the clashes. The DNR claims the Ukrainian military first voluntarily left the city and rebel fighters then occupied it. In an interview with the Kommersant newspaper, Representative of the DNR Defense Ministry Vladislav Brig said that the rebels' activity in Maryinka was a "response to the prevention of shelling of Donetsk," which had occurred on a regular basis. According to DNR Deputy Defense Minister Eduard Basurin, the Ukrainian side had organized "a provocation."

In turn, Kiev announced that the rebels had launched a full-scale attack in Maryinka, but were then stopped and forced to retreat. The Ukrainian government is convinced that Russia is behind this escalation. In his annual message to parliament on June 4, Ukrainian President Petro Poroshenko said that Russia needed the fierce fighting in this neighborhood in order to call an extraordinary session of the Federation Council, which would make the decision on officially sanctioning the use of Russian troops in Ukraine.

Meanwhile, Valentina Matviyenko, president of Russia's Federation Council explained an earlier announcement about the possible need for an extraordinary session of the council during the summer period by linking it to the necessity of passing important bills before the end of the spring session.

In March 2014 the Federation Council granted Russian President Vladimir Putin permission to send troops into Ukrainian territory in relation to "the situation in Ukraine and the threat to the lives of Russian citizens and Russian servicemen in Crimea." The Russian president did not officially use the authority invested in him, though there is mounting evidence that Russian troops are in fact operating in the Donbass, despite the Kremlin's denials.

Ukrainian experts agree with the country's government that Moscow is to blame for the escalation of the conflict. In an interview with the Ukrainian publication Glavred, ex-Defense Minister and head of the Expert Council of Ukraine's Center for Army, Conversion and Disarmament Studies Leonid Polyakov said that Russia is interested in using the Donetsk and Lugansk "republics" as a means of pressuring Ukraine, and it intends to "drive the Ukrainian troops away from the main administrative centers - Donetsk and Lugansk - by another 20-30 kilometers" as a means of trying to strengthen the self-proclaimed entities.

The U.S. State Department also blamed Russia for the escalation in the Donbass. "Russia is directly responsible for the prevention of such attacks and the realization of the ceasefire agreement," said spokeswoman Marie Harf.
 
Clashes are provocation, say Russian experts

Russian experts call what happened in Maryinka a provocation from the Ukrainian side. According to Alexei Fenenko from the Russian Academy of Sciences' Institute of International Security Problems, these events are part of the general logic of the current political process in Ukraine, one of whose main features is President Petro Poroshenko's "shaky position."

"On the one hand Poroshenko cannot accept the Transnistrian option (a frozen conflict with a part of the Donbass practically separated) and the beginning of the political process," explained Fenenko.

"On the other hand he understands that a new war would most likely lead to his defeat. Therefore, as in the previous case, he has selected the same tactic: small skirmishes that would demonstrate to the Ukrainian people that the war is continuing, but which would not lead to full-scale military activity," he said.

However, as Fenenko says, sometimes "this tactic breaks down." This happens when there is an "accumulated escalation." It happened in Debaltsevo after the signing of the first Minsk agreements and now it has happened again. Fenenko does not rule out that the current clash will not be limited to Maryinka, yet he does not believe that it will result in the renewal of large-scale hostilities. Most likely everything will end in a local operation, another defeat for the Ukrainian army and the signing of a third ceasefire agreement.

Editor-in-chief of National Defense magazine Igor Korotchenko also argued that the events in Maryinka were a provocation by the Ukrainian side, whose aim he said is to provoke the rebels into attacking. In his opinion, it is being done on the eve of the G7 summit with the purpose of accusing Russia of escalating the situation in south-eastern Ukraine. However, Korotchenko justified the rebels' desire to push the frontline back in order to stop the shelling of Donetsk, despite the fact that the frontline is established by the Minsk agreements.

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 #32
NBCNews.com
June 7, 2015
U.S. Trains Ukrainian Forces on Russia's Doorstep - And Moscow Isn't Happy
By CARLO ANGERER

YAVORIV, Ukraine - American troops are training Ukrainian forces on Russia's doorstep, a move seen as a major provocation by Vladimir Putin's regime.

The live-fire drills and counter-insurgency exercises involving about 300 U.S. paratroopers are a key bone of contention for the Moscow, which the West accuses of helping to arm pro-Kremlin rebels in eastern Ukraine.

The U.S. military has previously conducted exercises that involved Ukrainian soldiers, but the direct training is a first. Relations between Washington and Moscow are at their lowest ebb in decades with former Soviet leader Mikhail Gorbachev warning late last year that the world was "on the brink of a new Cold War."

Russia has also been excluded from this weekend's G-7 summit in Schloss Elmau, Germany, due to its annexation of the Ukraine's Crimea region. U.S. President Barack Obama, upon arriving in Germany, said the summit would discuss Russian "aggression" in Ukraine.

During the current six-month mission which began in April, the U.S. military is working with more than 700 Ukrainian soldiers in three rotations. Trainers say that their students are improving quickly.

"From what we saw at day one to where they are at right now, they've proven their willingness to learn," Capt. Nick Salimbene told NBC News. "They're getting better on a day-to-day basis."

The training by members of the U.S. Army's 173rd Airborne Brigade is taking place about 700 miles away from the front lines in Eastern Ukraine, where fighting intensified late last week.

According to the U.N., at least 6,400 people have been killed in the conflict since April 2014. It is never far from the minds of the Ukrainians being taught by U.S. service members.

During a recent visit by NBC News to the Yavoriv training center, two young Ukrainian National Guardsmen fired RPGs and watched as a wooden tank outline at the other end of the field splintered into pieces. The soldiers cheered in unison with their comrades and their American trainers.

The heavily-armed unit had made its way through fields shooting at pop-up targets and simulating the take-over of a command post.

"This is a scenario they could see in the conflict in the east," 2nd Lt. Ty Boyle, one of the American trainers, told NBC News.

The American training is at the request of the Kiev government, which is trying to modernize its military.

But Moscow isn't happy about it.

"The participation of instructors or specialists from third countries on Ukrainian territory, where the domestic Ukrainian conflict is unresolved, could destabilize the situation," Kremlin spokesman Dmitry Peskov told reporters during a conference call when the training was launched in April.

Ukrainian soldiers undergoing the training told NBC News that they expect to soon return to the frontline and said that the American efforts to teach urban warfare, counter-insurgency operations, and anti-propaganda training would help them.

U.S. military officials insist its military support is limited to defensive efforts. They say that they deliver no weapons, only protective gear, medical kits and vehicles - and only train soldiers of the National Guard, which is limited to missions inside Ukraine's borders.

But ongoing training is also a sign toward Moscow that the United States will stand by the Western-oriented government in Kiev.

"It demonstrates that the U.S. is there to stay," Maxim Shepovalenko, a military analyst at the Center for Analysis of Strategies and Technologies in Moscow, said. While U.S. support to the Ukrainian military is unlikely to change the balance on the battlefield, he highlighted parallels with another conflict.

"This all is very reminiscent of the 50-year-old story with Vietnam," Shepovalenko added. "The U.S.-Vietnam involvement started with instructors as well and then it developed into a full-scale military involvement."

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 #33
Business New Europe
www.bne.eu
June 8, 2015
KYIV BLOG: A break in the clouds over Ukraine's future
Ben Aris in Moscow

It's not exactly blue-sky news, but after a little over a year in office, Ukrainian President Petro Poroshenko had a few things to boast about in his recent annual speech before the Rada lower chamber of Parliament. Reforms have started and the first green shoots of economic recovery are now visible if you pick through the war wreckage that strews the national landscape.

The biggest change is that the hryvnia currency has stabilised and gross international reserves (GIR) have begun to rise again, albeit by very small amounts. GIR were up by 3% month-on-month in May, or by $287mn, to reach a total of $9.9bn at the end of the month, after a series of debt redemptions the government successfully met. That is the first rise in months since the country began to burn through its savings at the start of the Euromaidan protests a year and half ago when the National Bank of Ukraine (NBU) had some $34bn in its coffers under the regime of then-president Viktor Yanukovych.

The uptick in GIR was partly due to the issue of a US government-backed $1bn five-year Eurobond and the sale of a 3G mobile phone license. But more encouragingly, it also came from a sharp increase in the amount of taxes the state collected in April, surging by 46% month-on-month. Tax receipts have been rising since the start of the year and the budget had a surplus of UAH18.5bn ($880mn), of which UAH5.6bn was collected in April alone.

The biggest contributor to rising tax collection was also the easiest to collect: import duties were up a whopping 177.9% followed by excise tax (54.8%). These are crucial as Ukraine also needs to keep its level of imports down as paying for expensive Russian gas has meant the country has been running a large balance of payments deficit. But this too has fallen close to zero now the heating season is over. VAT was the other main contributor to the government's revenues, up 39.8%, less than the headline increase in the tax take.

If rising tax revenues are not enough proof that a semblance of normalcy is returning to Ukraine's economy, then the fact that its people are beginning to sell of their hoard of dollars is: the net sale of foreign currency by individuals remained positive in May ($177mn), according to the NBU, which was haemorrhaging billions of dollars a month to domestic exchange kiosks during the worst of the instability in the past two years.

But Ukraine is still not nearly out of the woods as $10bn only represents 2.1 months of import cover, according to Concorde Capital in Kyiv, which is less than the three months economists recommend to maintain the stability of the national currency. Moreover, the rising pace of tax receipts will slow going forward as part of the increase in revenues was due to the central government delaying payments to regional authorities. General budget outlays for the first four months of this year also increased by only 15.5%, although they are accelerating as the year wears on. Still, the management of the state's budget under the US-born Minister of Finance Natalie Jaresko appears to be well managed, arguably for the first time since Ukraine's independence in 1991.

"It's encouraging that government revenue is so healthy," says Alexander Paraschiy, head of research at Concorde Capital. "To a large extent, the April result was due to central bank support of UAH9.7bn and a payment from the 3G license sale of UAH2.7bn. Even [without] those payments, however, state collections jumped 24.9%, which is still impressive."

Capital controls

Clearly the NBU is also feeling a little more comfortable as it slackened the extraordinary currency controls a little on June 3. The regulator issued a directive that went into effect immediately and doubled the limits on daily cash withdrawals from banks to UAH300,000, as well as easing restrictions on foreign currency purchases for legal entities that have their own foreign currency in Ukrainian accounts. In addition, the NBU also doubled the threshold of currency transfers abroad exempt from complicated verification procedures to $50,000 from $25,000.

While limited in scope, these relaxations of currency controls are significant. When the hryvnia went into meltdown last year, losing nearly three quarters of its value, the NBU slammed the door on moving dollars about in a desperate effort to preserve its rapidly dwindling GIR. Currency controls are always the last measure of desperation, so any loosening of the complicated and barely enforceable rules is a big step in the right direction.

Of course, there is still a long way to go until all the restrictions are removed. Still in place are rules banning early withdrawals of foreign currency savings deposits, a four-day waiting period for foreign currency purchases, and a mandatory surrender requirement that forces exporters to sell 75% of their foreign currency proceeds to the NBU. And the foreign exchange market remains very subdued, with daily trading volumes in the order of $250mn a day compared with the more than $1bn a day of currency that was traded before the political chaos began in 2014, according to Concorde Capital.

"The NBU's move is symbolic and intended to signal optimism about the national currency's prospects," Paraschiy said. "The Ukrainian currency has been strengthening since March due to improved external accounts and halted hryvna printing. Against this backdrop, tension at the market has eased somewhat and the NBU wants to strengthen the tendency by relaxing controls."

Rumblings from below

Passing the nadir of recent collapse is welcome, but the sorry state of Ukraine's economy still leaves Poroshenko with a huge political problem: none of these improvements are visible at street level. In fact, quite the opposite is true.

The International Monetary Fund (IMF) team just left Kyiv, where it had been checking the government's compliance with the fund's demands ahead of the release of the next $1.7bn tranche as part of a long-term facility. Team members were extremely upbeat as the government had done everything that it promised to do, including hiking domestic household energy tariffs. However, Ukrainians are less impressed after seeing their gas bills more than double in the space of a few months. Demonstrators have already appeared outside the Rada to call for a return to the lower subsidised rates. "No one has felt a significant improvement and we need it like we need air," Poroshenko told the Rada deputies in his annual parliamentary address on June 4.

The danger the new government faces is that if it fails to produce a material improvement in people's lives it may experience a pro-Russian backlash of some sort. As bne recently reported, three quarters of Ukrainians already say they are "not satisfied" with the government's performance.

The quality of life is already in decay in Ukraine. The IMF downgraded Ukraine's GDP forecast to 9% for 2015 on June 2, down from the previous 5.5%, and with inflation running at over 50%, life is getting harder for most people by the day. Poroshenko desperately needs to turn this situation around and he laid out a grand agenda in his speech. Happily, the president can already point to several successes, even if the benefits have not yet worked their way down to the street.

Dealing with the dirt

Poroshenko suggested that the state starts running a "corruption audit", where plain clothes officials offer bribes to bureaucrats in sting operations to curb the endemic graft. However, a new anti-corruption bureau has already been set up and its head, Artem Sytnyk, told bne that ending corruption was the "top priority".

A slew of initiatives has been proposed to deal with graft, including creating a witness protection programme and allowing plea-bargaining to encourage bribe-takers to testify against bribe-givers. Ukraine will also take a leaf out of the late Georgian reform guru Kakha Bendukidze's playbook and radically slash the number of regulations that are used as the basis for extracting bribes in the first place.

However, the next step of judicial reform will be much harder to implement. Poroshenko is proposing new rules to make judicial appointments more transparent, but shocked deputies during his address when he called on the Justice Council to "fire more than 300 judges".

State procurement is another area where corruption is rife and here the government can highlight several big wins already. Lithuanian-born Economics Minister Aivaras Abromavicius bested oligarch Ihor Kolomoisky, he told bne, describing how earlier this year he ended a scam to cream off a 15% discount off state sales of oil for more than a decade, worth hundreds of millions of dollars a year. And the state has been turning the screws across the board. "Kickbacks have decreased, many schemes were closed, transparency has increased, and social control has become more solid," Poroshenko told the deputies, the Kyiv Post reported.

Another positive sign that there is real steel in Poroshenko's political backbone to carry through this reform was evidenced by the Rada's vote to pull immunity from prosecution from two deputies, Serhiy Kliuyev and Serhiy Melnychuk, in the run-up to the president's speech. Prosecutors haven't said what they are investigating, but Kliuyev is likely being probed for links to the murder of former MP Oleg Kalashnikov, who reportedly told relatives that Kliuyev was among those owing him large sums of money for organizing political rallies, according to prosecutors. Melnychuk's alleged crimes are much smaller in scale, according to Concorde analyst Zenon Zawada, who has also criticised the government for its lack of progress in fighting graft in parliament. Both Poroshenko and Kyiv mayor and former boxing champion Vitaliy Klitschko have also been accused of shady real estate deals since taking office.

Poroshenko is not going to follow the lead of his friend and former Georgian president Mikheil Saakashvili's and sack the entire police force - but he will come close. Ukraine's new interior minister Eka Zguladze (a Georgian) will introduce a new traffic police force, the first parts of which will hit the streets by the end of this month and are bound to generate metres of column inches about Ukraine's attempt to "do a Georgia". The government is bound to hype the change too, as it will be the first visible implementation at street level of effective reform. The 'GAIshniki' (as traffic cops are known, taking from the acronym for state traffic inspectorate) are notoriously venal and nearly everyone at the wheel has been a victim of their greed.

Putin's footsteps

Poroshenko also re-iterated his campaign of de-oligarchisation, mentioning the word 11 times in his speech. The irony is that he is in exactly the same position as Russian President Vladimir Putin was in 2000. Under former president Boris Yeltsin the oligarchs were running the country and Putin himself is said to have been handpicked for the job by oil tycoon Roman Abramovich. Amongst his first acts was to rein in the oligarchs with some targeted attacks on Boris Berezovsky and Vladimir Gusinsky, both of whom controlled major Russian media assets. Poroshenko has already sacked his nemesis Kolomoisky from his job as governor and seemingly won a battle to oust him from the state oil company Ukranafta. (However, documents are now surfacing that purport to confirm Kolomoisky's right to appoint managers in the company, sanctioned by former prime minister Yulia Tymoshenko). Rinat Akhmetov, formerly Ukraine's richest man, has also seen his empire come under scrutiny. Poroshenko pointed out in his June 4 speech that 80% of Ukraine's power assets are held by Akhmetov's company, "but the Anti-Monopoly Commission doesn't consider that to be a monopoly?" the president asked the assembled deputies.

"Private business should manage its own companies, but not graze in the state companies, nor feed on the budget flow," Poroshenko said, paraphrasing Putin's offer to Russia's oligarchs at his now legendary oligarch meeting in 2001: You can keep what you have, but no more stealing. Poroshenko added that Ukraine's current losses from "cartel agreements" range from 10% to 22% of GDP and two out of five goods are sold in monopolised markets.

Finally, the president promised to sell off 50 state-owned enterprises (SOE) from a total of about 1800. Only 200 of these are vital to the state and will not be sold. However, this is one promise that the president will struggle to fulfill. As Abromavicius told bne in a recent interview, the top half dozen of these firms are worth all the money, but as the president's own tribulations in selling off his Roshen chocolate factory show, there are few buyers of Ukrainian assets about while war rages in the east. After dithering for a year, Poroshenko announced on June 5 that he was transferring the chocolate factory to a Rothschild fund, which isn't exactly a sale. Getting rid of the other SOEs will be even more difficult.

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 #34
www.rt.com
June 6, 2015
'Impeach Poroshenko!' Massive anti-govt rally held in central Kiev
[Video here http://rt.com/news/265516-kiev-protest-against-government/]

A massive march took place in the streets of Kiev to protest against the policies of the current Ukrainian government, calling for its resignation and economic reforms.

According to TASS news agency, up to 3,000 people took to the streets in Kiev on Saturday to protest against lack of reform and economic instability.

The people carried placards reading "We are hungry," "Raise pensions" as well as some anti-LGBT slogans as they marched along Khreshchatyk Street to Independence square (Maidan Nezalezhnosty) in central Kiev.

Others called for the current administration to be removed and President Petro Poroshenko impeached, saying his government was unable to handle the problems facing the country.

Protesters demanded a raise in social welfare payments and an end to the unrest in eastern Ukraine. Reinforced police patrols ensured public order during the march.

Meanwhile, on Friday a Gay Pride march also took place in central Kiev. However, it ended very quickly after attacks by far right radicals. Members of the Right Sector nationalist group hurled smoke bombs and stones at the demonstrators.

Five policemen were injured, one seriously, and about 30 attackers were arrested, according to local media reports.

Previous to the event, Right Sector spokesman Artem Skoropadsky threatened the LGBT activists saying "there will be thousands of us" to counter the march, the Kyiv Post reported on Friday.

Political analyst Aleksandar Pavic told RT that there has been a rapid decline in living standards and human rights since the Maidan revolution in 2014, which resulted in the violent ouster of the former government by Kiev's current authorities.

"After the Maidan 2014 nobody in Ukraine is enjoying a better life, except people at the top of organizations and structures that caused the Maidan revolution," Pavic said.

Since Maidan, Ukraine has established an almost "oligarchical regime," as the current government has excluded a "large fragment of the population from having a say in political life," he said.

"If they look at their lives today and a year and a half ago I think they cannot but notice the big decline of living standards and even human rights."

Even under Yanukovich's rule Ukraine was "much closer to the European way of life," Pavic said.

"They had peace, they had some hope of economic advancement, they had offers from both West and East," he added.

Speculating on potential reactions from Kiev's Western supporter-states to the recent unrest in the capital, he said there will be a public reaction, but "fundamentally nothing will change because they need these people to keep Ukraine in the Western orbit."

"They've allowed the Right Sector to integrate with Ukraine's national army. You have US army officers training units with members of Right Sector in them."

The Maidan protests initially began as peaceful protest against then-President Viktor Yanukovich's refusal to sign an EU association deal in late 2013. However the demonstrations slid into violence and resulted in a coup that toppled the former Ukrainian president and his government in February 2014.

The new authorities promised to undertake political and social reforms needed to meet the economic and democratic norms of the EU countries, so that Ukraine could eventually join the union.

While Kiev awaits concrete assurances from bloc members, EU leaders have been wary of welcoming its eastern neighbor.

"They have their right to have a dream, but maybe not membership in the predictable future," European Council President Donald Tusk said at the latest Riga summit of the Eastern Partnership in May.

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 #35
Forbes.com
June 5, 2015
Ukraine's 'War Rumors' Pull Rug Out From Russia
By Kenneth Rapoza

Three months ago I received a number of emails and even comments on news articles here about how Russia would kick-start a war with Ukraine this summer. It was prescient. Almost too prescient. In the past four weeks, Ukraine president Petro Poroshenko has been warning about Russia amassing military equipment along the eastern border. Whether this is true or not is not the story here. What is worrisome about this is that Europe extended sanctions in March and there is chatter of U.S. sanctions continuing into next year. Reheating a civil war in Donetsk and Luhansk will surely make that come to pass. And there goes Russian equity in 2016.

In fact, since Poroshenko has been coming on television discussion Russian military tactics over the past four weeks, the Market Vectors Russia (RSX) ETF is down 11.1%. It is now underperforming the MSCI Emerging Markets Index in that month-long period, the first time it's been an underperformer in 2015.

Then there's the ruble. Oil price declines haven't helped it. The Russian currency is down 7.67% in the last four weeks since Poroshenko has been beating the war drums.  The iPath S&P Crude Oil Index is down 4.5% in the same period.

The ruble is the worst performing BRIC currency in the last four weeks, and while I doubt this is because of Poroshenko or Ukraine, a worsening climate there will sour investor appetite and could push oil down further.

"We do not believe the civil war will heat up even more, despite histrionic reports by the Kyiv government that a Russian-led invasion is imminent," says Vladimir Signorelli, founder of Bretton Woods Research, a top-down investment research firm based in New Jersey.

One way to look at this: Poroshenko and prime minister Arseniy Yatsenyuk may very well decide to raise the specter of the Russian bear in an attempt to plug up the holes in their terrible public approval ratings. The Ukraine economy is in shambles. GDP contracted 17.6% in the first quarter and annualized inflation is nearly 60%, 58.4% as of May. Renewed hostilities may be the easiest path for government officials to cool the heat on themselves, but the rhetoric, if that is what it truly is, will have to be weighed carefully by RSX holders. The chatter is not going to help, nor is the renewed fighting in Donbas. It's been a few months now since Russia was the bad guy in global equity markets. Maybe its time has come again.

Looking at this from the other side, with the sectoral sanctions extended against Russia until Dec. 31, 2015, Russia could feel picked on enough to stir the pot and make mince meat out of the Minsk Accord. This is the absolute worst case scenario.

The base case scenario is that Poroshenko is wagging the dog about a full blown invasion. There remain concerns that civil unrest continues, with pro-Russia forces fighting the Ukrainian army still in cities across eastern Ukraine.  Some seem to be cheering for it.  Actual fighting and Poroshenko's dire warning of a pending escalation have made the G-7 agenda this week.

Opinion polls show declining faith in both leaders. Almost 60% of Ukrainians disapproved of Poroshenko`s performance in a March survey. Yats has lost even more support than Poroshenko, because the population associates him with the economic crisis, unemployment, low salaries, and inflation, Anton Grushetsky, an analyst with the Kyiv International Institute of Sociology, told the Christian Science Monitor's Fred Weir.

Local elections across Ukraine are scheduled for October. It will be interesting to see just how the locals reward the pro-European politicians under Yats. Or if we go back to more of the same Ukrainian ways. These are all unknowns and I won't pretend to know them. There are plenty of people out there who will pretend to know, even without sources in the the Russian or Ukrainian governments. (That's amazing!)

What we do know is that Russian assets will follow the direction of two things: oil futures and Ukraine's short-term future. Oil will weigh more, so long as Poroshenko is wrong. If Poroshenko is right, and violence intensifies, the Russia ETF will feel the pressure. Oil will probably decline as it has in the past when the Ukraine variable was in red alert.

Meanwhile, Putin has been playing it cool. The Monitor's foreign correspondent Fred Weir noted that the word "Novo Rossiya" (New Russia) has been dropped from the lexicon of top Russian officials these days, an attempt to back people off the belief that the Kremlin is planning on acquiring more Ukrainian real estate.

Russia annexed the Crimean peninsula in the Black Sea in March of last year following a local vote to secede from Ukraine. The U.S. and European Union blasted Russia for annexing Crimea and said the vote broke international law and Ukraine's constitution.

The Minsk Accord does not allow for any more annexations.

Meanwhile, Foreign Minister Sergei Lavrov remains a continued advocate for negotiations between rebels and Kyiv. Secretary of State John Kerry was also in Russia recently to meet with Putin. Clearly the trip was geared to stabilizing the situation, rather than exacerbating it. This is a plus for investors concerned with political risk.

What we know is that the anti-Russian, hawkish elements of the Poroshenko government have lost their shine, Signorelli wrote in a note to clients on Friday. "The easiest path for the West may be to keep calm on Ukraine, rather than inflame the situation with Russia," he says.

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 #37
The Unz Review
www.unz.com
June 5, 2015
Saakashvili's Legend, A Con for the Ages
By ANATOLY KARLIN
[Charts here http://www.unz.com/akarlin/saakashvili-legend/]

In the latest news from the ongoing comedy skit that is Ukrainian politics, we learn that Mikheil Saakashvili has been appointed governor of Odessa oblast.

Who is Saakashvili?

The son of Soviet apparatchiks with ties to the diplomatic service, which was dominated by Georgians in the late USSR, this onetime university dropout enjoyed a great deal of success in the 1990s, picking up various fellowships, grants, stipends, awards, etc. from respectable European and American institutions. Invited back into Georgia by his friend Zurab Zhvania, he soon went into opposition to Gorby's Foreign Minister turned Georgian President Eduard Shevardnadze. Eventually, this culminated in Shevardnadze's overthrow in the Rose Revolution of 2003. From then on, it was a familiar story.

Saakashvili was, back then, one of the beacons of pro-Western liberalism and reform in the former Soviet world, the object of regular paeons in the MSM. Some of the lustre has since come off, following his idiotic attack on Russian peacekeepers in South Ossetia that resulted in military defeat in 2008, and his own ignominious political end in Georgia itself following revelations of mass abuse in the prison system - under his Presidency, the incarceration rate tripled to become Europe's highest per capita - relevations that were carefully coordinated by his political opponents. He is now wanted in his native land, which he fled even before his Presidential term came to a formal end, on an array of charges related to corruption as well as possible involvement in various suspicious deaths (including that of Zhvania kek) and murders. Nonetheless, for all his democratic and human rights failings, which all but the most hardcore neocons by now acknowledge, there is still a very widespread impression that he is at least someone who can get the job done - that is, improve living standards, strengthen the country, and root out corruption. After all, did he not liquidate the everyday bribery that is a depressing feature common to the entire post-Soviet world? Did he not make Georgia one of the world's most attractive places for business? Did he not lay the foundations of, in his own word s, "a future Georgian Switzerland, the future Georgian Singapore, the future Georgian Dubai, the Georgian Hong Kong, and of the greatest Georgia of all times"? And would not Odessa benefit from his impeccable credentials and expertise?

The only problem is that his legend is lies, lurid and false; a con for the ages.

The Economy

The economy did grow under Saakashvili. And across a range of institutional indices like the World Bank's Ease of Doing Business, Transparency International's Corruption Perceptions Index, and various economic freedom indices it did radically improve its position.

The only problem was that it was doing so from an exceedingly low base, and even today, total GDP per capita (in constant dollars) is still considerably lower than it was in 1990. That's 25 years and counting! Moreover, the growth rate was virtually the same under the "reformist" Saakashvili as it was under the "Soviet fossil" Shevardnadze. Nor was it any better than that of Georgia's neighbors. To the contrary, it was far worse than in Azerbaijan, which yes you could ascribe to oil, but was also far worse than in neighboring Armenia and in Belarus. Both Armenia and Belarus are located in geopolitical straits just as trying as Georgia's - Armenia is blockaded on two sides by Turkey and Azerbaijan, while Belarus is known as "Europe's last dictatorship" and is under longstanding Western sanctions. Georgia's performance, including under Saakashvili, only looks adequate in comparison to the total disaster zones that are Ukraine and Moldova. Productivity in the agricultural sector - where around half the Georgian population still works - has remained completely static since the early 1990s, whereas it more than trebled in neighboring Armenia.

Amazing as it might sound, but fanatically-pursued libertarian reforms, US military aid, and a couple of hotels erected by Trump to service gushing Westerners seeking photo-ops with Saakashvili on G.W. Bush Boulevard do not a strong economy make.

Corruption

One of the things that virtually everyone agrees on, even his critics, is that under Saakashvili, Georgia "solved" its corruption problem. If so, this would make it a somewhat unique achievement for the ex-Soviet world, bar only Estonia, and worthy of praise.

Now what does the data say? Certainly Georgia greatly improved its positions on surveys that elites pay a lot of attention to, such as Transparency International's Corruption Perceptions Index, where Georgia increased its rating from an abysmal 18/100 in 2003 to a respectable, Baltic-level 49/100 by 2013. But according to ratings that measure corruption realities as opposed to the perceptions of anonymous "experts" who can be unduly influenced by PR agencies - the likes of Aspect Consulting, Orion Strategies, Public Strategies, and the Glover Park Group, which received millions of dollars under Saakashvili to burnish his reformist image - the improvement on the ground was far more modest. 6% of Georgians reported paying a bribe in the past year in 2004, the first year of Saakashvili's Presidency, and before his reforms could reasonably be expected to have taken effect; in 2013, the last year of his President, it was 4%. An improvement, sure, but not a particularly radical one. Actual opinion polls by Transparency International suggest that lowlevel corruption was not a big problem in Georgia pre-Saakashvili, and its reduction under him could just as easily have been a simple matter of the general withering away of the state's regulatory agencies under his libertarian reforms. For instance, the near wholesale removal of university tuition subsidies - essential for democratic access to higher education in a country as poor as Georgia - led to a plunge in tertiary enrollment by almost a third relative to the early-to-mid-2000s. Fewer students automatically translates to fewer bribes for grades. These examples can be extended indefinitely: Less contact with the state automatically leads to "lower" corruption. That doesn't necessarily mean it's "good" in all cases.

What about institutions? According to the Open Budget Index, an organization that asseses the transparency of state accounts according to objective criteria (as opposed to perceptions), Georgia did improve, but has always lagged Putin's "mafia state." Now, true, a low score in the OBI doesn't necessarily imply institutions are more corrupt; they could be both secretive and honest. But in the virtual absence of objective, quantitative measures of institutional quality - of which corruption perceptions by a bunch of anonymous and unaccountable "experts" are most definitely not - it's the best we have, at least as a rough proxy of states' eagerness to tackle corruption and willingness to be forthright with their citizens.

Then, in addition to lowlevel and institutional corruption, we also have highlevel corruption. This is the hardest to gauge of them all, even just by definition (how many American bank bailouts are equivalent to how many Chinese or Russian offshore accounts?). That said, this is the one aspect of corruption in Georgia that many people acknowledge is unlikely to have improved and might have even become worse relative to Shevardnadze's period. To the contrary, all accounts indicate that Saakashvili merely centralized highlevel corruption around his own figure - allegations that have now been given form by concrete criminal charges against him in Georgia.

Added all up, we likely see real but modest improvements in lowlevel and institutional corruption under Saakashvili, which is of course "good" but doesn't come anywhere near to justifying the panegyrics addressed towards him by Western elites and their lackeys in Ukraine when we consider that these improvements were seen in most of the rest of the ex-Soviet world in the 2000s as well, including in the dark lands themselves, Putin's Russia. As for highlevel corruption all that happened was that the pig put on lipstick.

Demography

Surely the ultimate litmus test of a political leader's performance is in whether people want to live in his realm or not. For a long time, for all his foreign policy failings and overblown economic and institutional achievements, it appeared that in this at least Saakashvili had succeeded, with Georgia's demographic decline stabilizing at around four and half million people after 2002 due to declining emigration and a rebound in the fertility rate from 1.4 children per woman in the early 2000s to 1.8 today.

Then came the 2014 Census, and it emerged that Georgia's population decline had if anything accelerated under Saakashvili, with the population hitting 3.7 million relative to 4.4 million in 2002 and 4.9 million in 1989 (all figures are minus Abkhazia and South Ossetia).

Where did all the Georgians go? Most went to Russia: Of the $1.26 billion Georgia received in remittances in 2011 (almost 10% of Georgia's GDP), more than half - $655 million - came from Russia. Surely quite an embarassment that the economy of "Switzerland in the Caucasus" and "oldest Colchis Europe, the most ancient civilization" was essentially held afloat by Georgian Gasterbaiters in a "barbarian" country with "mongoloid brutality and ideology," as Saakashvili himself put it.

But even as Saakashvili ranted and raved about Russia's Asiatic barbarity, using vocabulary that had disappeared off respectable European tongues since 1968, it appears that Georgians continued to vote with their feet and emigrate to Russia in ridiculously large numbers. For comparison, Georgia's population loss over the past decade is equivalent to what saw in Latvia or Lithuania after their accession to the EU. I imagine it is considerably easier for a Balt to move to Ireland than it is for a Georgian to move to Moscow.

Mishiko in Odessa

Now that the myth has been swept away, we have just the man before us, whose essence boils down to an idiosyncratic combination of iconoclasm, vindictive incompetence, and Western cargo cultism.

Perhaps the best real life metaphor for this was the demolition of a Soviet-era monument to victory in the Great Patriotic War in Kutaisi, in which 200,000 Georgians died. Not a monument to Stalin, or anything like that - though it should be noted that Georgians are far more partial towards Stalin than are Russians - but just a simple victory monument. But they couldn't even get that right. When it was blown up, two people - a mother and her eight year old daughter - were killed by the flying concrete, and four others were seriously injured. This was noticed, even in the West. As a Western cargo cultist in a position of power you really have to fuck up pretty good to even get American state media like RFERL to criticize you.

On getting appointed to head Odessa oblast, despite having at most just ever visited it as a tourist, Saakashvili smarmily proclaimed "I ❤ Odessa." A whole range of other people were not that happy. Kolomoysky, the oligarch-lord of Dnepropetrovsk, whose protege Igor Palitsa had previously ruled Odessa and who is locked in a simmering conflict with Poroshenko, said that Saakashvili would betray Odessa to the Russians at the first opportunity: "By the way, how many citizenships does Saakashvili have? Would probably beat even me. American, Georgian, Dutch, and now Ukrainian" (Kolomoysky, for the record, has three. When a journalist told him that double citizenship is illegal in Ukraine, Kolomoysky remarked that while that is true, there's nothing illegal about triple citizenship on the lawbooks. A bona fide Odessan retort if there ever was one). Lyashko, a caricature of a nationalist politician who is also widely regarded as a faggot amongst all Ukrainians, including even his supporters (much more so for his hystrionic grandstanding and violent denials than for the actual details of his sexual orientation), and is also deeply at odds with Kolomoysky, was also against the appointment: "Of all Ukraine's 45 million citizens, not a single one could be found to head Odessa oblast? ... [Poroshenko] admitted before the whole world that Ukrainians are unable to govern themselves. Maybe we should get a President from abroad too?" Sure... why not. Finally, Dmitry Medvedev, Russia's PM and President at the time of the South Ossetian War, undiplomatically remarked: "The comedy show continues. Unhappy Ukraine..."

When you have someone who simultaneously infuriates and/or amuses such an amazingly wide and conflicting range of political forces, you know that the whole thing is a pathetic farce.

Both Western and Russian analysts have linked Saakashvili's appointment to the mounting blockade of Transnistria, the breakaway Russo-Ukrainian population Moldovan province. With Ukraine now on board as well as Moldova, its position has become very precarious. Short of Russia establishing an air corridor, the garrison within Transnistria is no longer able to resupply. It is not an exaggeration to say that it is now an additional potential flashpoint to an outbreak of overt hostilities between Russia and Ukraine. In this sense, bearing in mind Odessa's position right next to Transnistria, Saakashvili's resume is exceptional.

But in reality things are probably somewhat simpler. Odessa is the most unstable province in terms of separatist sentiment along with Kharkov, due to both demographics and memories of the massacre of anti-junta activists in May 2, 2014. Poroshenko needs someone who is able to crack heads if need be, someone who is unrelated to Kolomoysky, his prime rival in Ukraine's game of thrones, and preferably also someone who as an outsider would be unable to establish his own independent powerbase. Finally, it is a solid "fuck you" to Russia, and fuck what Georgia - one of Ukraine's putative allies - makes of that. This might not sound very rational to Western ears, but reason and moderation has always been foreign to the Maidan ideologues. That is why they have unleashed a civil war in place of dialog in the first place. That is why they have claimed the not inconsiderable achievement of alienating major figures in the Polish security establishment - traditionally, and understandably, highly anti-Russian - by their maniac worship of Stepan Bandera and his murderous goons.

So in this sense Saakashvili's appointment is perfectly understandable.

On another level, however, it is also rather sad, and not just in the way it blithely ignores Odessan opinions and lays bare the failure of Ukrainian statecraft. Saakashvili might have been a cargo cultist, obsessed with making the correct gestures - G.W. Bush Boulevards, being the third largest contributor in terms of troop quantity in the occupation of Iraq - to get cargo from the West and even half-succeeding at it - Trump Towers in Tblisi, a few five star hotels in Batumi, copious US military aid, etc. None of that cargo made a difference when Saakashvili's forces murdered Russian peacekeepers in South Ossetia in the expectation that the US would openly intervene on his side, only to face complete military defeat and the permanent reversal of the Stalinist-era borders that gave ethnically distinct Abkhazia and South Ossetia to Georgia in the first place.

But at least, in his defense, so far as cargo cults go, Saakashvili was the real deal. How much more pathetic is it that Poroshenko's Ukraine is making a cargo cult of a cargo cultist?

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 #38
Moscow Times
June 8, 2015
Will Transdnestr Crisis Force Russia Into War?
By Vladimir Frolov
Vladimir Frolov is president of LEFF Group, a government relations and PR company.

The West should help defuse a potentially explosive situation over Russia's military access to the self-proclaimed republic of Transdnestr which is shaping up as another Russia-Ukraine flash point.

On May 21, the Ukrainian parliament voted to suspend all military cooperation with Russia, effectively terminating the 1995 agreement giving Russia military transit rights across Ukraine to its forces in Transdnestr. Simultaneously, Moldova tightened the rules of transit for Russian military personnel traveling via Chisinau airport.

This blocks the regular rotation of the Russian 1,300-men-strong Operational Group of Forces in Transdnestr while the Ukrainian move blocks its resupply and rearmament.

Given Russia's shenanigans in Crimea and the Donbass, Ukraine's decision is understandable, but it may also give Moscow a legitimate "casus belli" for going all the way in militarily in a larger scale remake of the 2008 war with Georgia.

A senior Russian Defense Ministry official stated after the Ukrainian vote that Russia would resupply its base under any circumstances, even through an air bridge. This may not be to Chisinau, the Moldovan capital, but to a recently restored airfield in Tiraspol. That would put Ukraine in a difficult position - whether it should allow Russian military flights over its territory to bring "little green men" within 100 kilometers of Odessa.

A move to deny flights or intercept Russian military planes over Ukraine could give Moscow the grounds for full-scale military retaliation. Duma Deputy Sergei Zheleznyak stated that an attack on Russian forces in Transdnestr would most certainly mean war with Ukraine and a "Russian march on Kiev."

This could only come in the Donbass and perhaps in Kharkiv where Russia has border control. The small Russian force in Transdnestr is unfit for offensive operations, while an amphibious assault on Odessa from Crimea is beyond the current capabilities of the Russian military. The objective would then be to broaden the area under separatist control, perhaps followed by their recognition as sovereign states, giving Russia a larger buffer zone with a Western-allied Ukraine.

The way to forestall this is for the West to work with Moldova to allow the resupply of Russian forces in Transdnestr through Chisinau airport under OSCE monitoring to ensure the force levels do not increase. But one has to move fast.

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 #39
Izvestia
June 1, 2015
Aleksandr Chalenko, Transnistria in The Gun Sights; Journalist Aleksandr Chalenko on What Saakashvili's Arrival in Odesa Portends

Just a week ago, when Mikheil Saakashvili was flying back to Kyiv [Kiev] after the Riga summit which had been a failure for the West, he still did not suspect that in literally a week's time he would become governor of Odes'ka Oblast [Odessa Region].

As a pariah who had fled his native Georgia and as a failed foreign worker to whom America had refused a working visa, the post of adviser to Petro Poroshenko had suited him perfectly.

After all, it's nothing like languishing in a Georgian prison, where your political opponents will most likely take revenge.

Let me remind you that under Saakashvili, in "European" Georgia, reprisals were carried out against male political opponents in the most savage manner - they were raped, with the entire procedure recorded on video.

This week there was talk doing the rounds of Kyiv that Supreme Rada Deputy Serhiy Kunitsyn, another outcast, but only from Crimea, was about to be appointed to the post of Odesa [Odessa] governor. In the 1990s under Kuchma he was prime minister of the peninsula's government. The last post he held there was called acting representative of acting President Turchynov, with all ensuing consequences, the main one being exile.

At first glance Saakashvili's appointment looks like some kind of surreal step by Poroshenko. The regime's opponents even responded to it with jokes on Facebook. They said that prices for neckties would rise in Odesa now [reference to occasion when Saakashvili was seen chewing his necktie]... That Mishka [diminutive of Mikhail or Mikheil] Gruzinchik [play on name of "Mishka Yaponchik" (Mishka the Japanese")1891-1919, an Odesa gangster and revolutionary who at one stage was in virtual control of the city; "Gruzinchik" means "Georgian"] gang has seized Mother Odesa [common way of referring to Odesa; may also be reference to Ukrainian TV series 'Odesa-Mama,' set in 1969 and involving the arrival of a Caucasus gangster in Odesa] ... That the grant eaters would now write a new book entitled "Why the Privoz Market [Odesa market place] Has Done Well"...

But nevertheless everyone is trying to provide a halfway rational explanation for this to put it mildly strange appointment.

Many people in Ukraine argue this way: Poroshenko's failed regime had to demonstrate at least some results. Doing that on the scale of the entire country is unrealistic. There is neither the money nor the desire, primarily among the corrupt local bureaucrats. It all suits the latter.

In this situation at least one region had to be turned into a "showcase," into a big Potemkin village, to show to his own citizens, to the West, and to Russia, so that he could say, look, Ukraine has done well too.

Why did they choose Odesa for this experiment?

There is one explanation: Above all to compete with "annexed" Crimea. They want to prove to Crimeans as a result: You wanted to join Russia, but what has happened? The peninsula is blockaded, it is subject to sanctions, investments are not arriving there. The resort season was a failure. And now look at the seaside city of Odesa, look how it has flourished.

It was allegedly to implement these plans that Saakashvili, author of the "Batumi miracle," was chosen.

Let me tell you what kind of a "miracle" that was. Following Aslan Abashidze's exile from Ajaria, they started to turn Batumi into a "showcase" for the Saakashvili regime. What was the result?

In 2011 I personally visited Batumi. And let me tell you, it is not a city but an outright confidence trick. Yes, the first three or four streets next to the sea have been completely reconstructed. They look beautiful. A cycle track has been laid along the sea wall ("just like Europe"). It is true that for the hour I spent next to it not a single cyclist rode by.

Two smart hotels have been constructed: the Radisson and the Sheraton. They have put in a big fountain, installing a massive gold-plated sculpture of a naked Neptune with his trident.

But for whom has all this been constructed? For tourists. But what tourists? Who is going to travel from Europe to Batumi if it rains there for about 200 days out of every 365?

All in all, Batumi was a typical "Saakashvili village."

But the reality there was different. At that time 90 per cent of the city's structures had not been rebuilt since Soviet times. Away from the reconstructed sea wall it all looked squalid: Khrushchev-era apartment blocks covered in rusty iron cladding to stop the walls getting damp; roads full of holes, with big potholes right in the middle of the carriageway.

And most importantly - an indigent population. The question remains: Why in that case do they need Saakashvili in Odesa?

Although there are many people in Ukraine, including in the regime's offices, who believe that "things have worked out for Georgia," it is still somehow hard to believe that Saakashvili has been appointed to turn Odesa into a piece of candy.

I believe that his appointment should be viewed more broadly. I think the main explanation is that Transnistria is next door to Odes'ka Oblast.

Events of the past few months attest that the Ukrainian and Moldovan authorities with, naturally, support and leadership from the United States, are preparing something bad for the Dniester Moldavian Republic and Novorossiya.

Without a war the Poroshenko regime in Ukraine will come to an end. All the setbacks in the economy and social life will now be ascribed to the war. However strange it may seem, it is the war which is so far protecting Ukraine from a social eruption.

It is also possible to keep at the front, a long way from Kyiv, the country's main activists - the Ukrainian nationalists from the radical pro-Nazi organizations and volunteer battalions. That is the first point.

Second, Poroshenko is not ready to continue to adhere to the Minsk accords and to implement all their points. Yes, it is possible to withdraw heavy weapons from the front line, but he cannot embark on Ukraine's decentralization (read, not even its federalization or confederalization) and the legalization of the DNR and LNR [self-proclaimed Donetsk and Luhansk People's Republics] inside the country. It is simply that all this will mean death for Ukraine.

So there is only one way out - war.

If you now ask any commander in the DNR or LNR army, as I regularly do, whether in their opinion there will be a war this summer or not, you will get a single answer: Yes, there will. And that is not simply some kind of empty claim.

Your interlocutor will confirm his words by pointing out that the Ukrainian side is constantly bringing reserves, ammunition, and fuel up to the front, and no one will ever do that without a planned offensive.

However, war is all very well, but Ukraine has a very big chance of losing it again, as was the case in June and August 2014 and in January-February 2015. And that again means likely territorial losses for Ukraine, which in the end will threaten Poroshenko's regime.

Yes, Ukraine is interested in war, but in a trench war, without any substantial offensive, when the warring sides spend months shooting at each other from "Grads" and mortars.

Ukraine does not have the forces for an offensive. But it does have a chance, as was the case before, of facing a serious counteroffensive from Novorossiya. And it is a very realistic chance.

What to do in that situation? In the opinion of the Ukrainians and Americans, only the threat of Transnistria's occupation will hold back the DNR and LNR and Russia, which stands behind them.

Saakashvili's appointment has been set up so as to emphasize the full seriousness of intentions on this score. The Georgian ex-president is associated with the war of 2008. They want to make clear to us: If you Russians start a large-scale offensive on the Northern Donets Basin or Mariupol, we will set up a blockade of Transnistria and help Moldova start an offensive on Bendery, Tiraspol, and Dubasari.

The events of recent months provide graphic evidence of pro-Romanian and pro-Western Moldova's readiness to take a large-scale part in the big geopolitical game on the side of America and Ukraine.

First, it has understood that it is all serious as far as the latter are concerned. Judge for yourself, for two months now they have been transferring troops and the national guard (many draftees were initially sent to Odes'ka Oblast) to the Balta region; Ukraine has adopted a law tearing up previous treaties on the unimpeded passage of Russian servicemen to Transnistria.

Incidentally, there is information that a few weeks ago about 300 Americans entered Chisinau and have been accommodated in the television centre building. The jigsaw pieces are shaping up into something alarming...

So far it is not known how Novorossiya and Russia will respond to all this. The only reassurance here is Saakashvili himself. He is a kind of good sign.

Saakashvili is after all a sign of defeat. On this occasion not only for Georgia and the United States but also for Ukraine. So Saakashvili's arrival means another victory for Russia.

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 #40
Interfax-Ukraine
June 5, 2015
Ukraine's Luhansk governor cuts off water supply to rebel-held territory

Kiev, 5 June: After the LPR [self-proclaimed Luhansk People's Republic] caused a power cut in the Stanytsya Luhanska district, Luhansk regional governor Hennadiy Moskal has ordered a complete cut off of water supplies to the occupied territories.

According to Moskal's press service, Stanytsya Luhanska and eight nearby villages have been left without power since the afternoon of Wednesday, 3 June. The main transmission line, which previously supplied electricity to the district, was cut as a result of bombardment. Therefore power is currently supplied here via a backup line from Russia through the occupied territories, and Ukraine is making regular payments for these supplies.

"The backup power line is damaged in occupied territory, but the militants do not allow the repairmen there," Moskal said. "Emergency teams have tried several times to get to the damaged place, but without success. Now, there is no water supply in Stanytsya [Luhanska] and part of the district due to the absence of power, while mobile communications are very difficult."

Moskal said that while shelling villages over the past two weeks, the militants damaged in three places the pipe supplying water to the territory they occupy. "I warned them then that water supply will be resumed only after the imposters from the LPR repair the damage on their own and at their own expense. I personally guaranteed access and safety for the repairmen. However, instead of repairing the water pipe, the LPR have cut off power supply to Stanytsya," Moskal said.

"They have launched a utilities was against us, and I have no other choice but to completely cut off water supply into the occupied territories. Today, from 0900 [0600 gmt], my order was fulfilled. Water supply will be resumed only after electricity supply is restored in Stanytsya, and they guarantee a stable supply. We will act like Ostap Bender [character in novel by Soviet authors Ilya Ilf and Yevgeniy Petrov] - [you give us] electricity in the evening, [we give you] water in the morning," Moskal concluded.

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 #41
www.liveleak.com
Pro-Kiev battalion commander: "99% of people I know in Donbass have come to hate Ukraine by now" (from Kyiv's "Shuster Live")
[Video here http://www.liveleak.com/view?i=f70_1433650265#hWhkwc9wfHpl7tsY.99]

"Tornado" battalion commander (deputy commander?) Nikolai Tsukur speaking at a hugely popular talk show "Shuster LIVE":

Transcript:

Many here don't know, but I'm from foreign-occupied territories, from the city of Perevalsk, I said this before...

Right now you are talking and you don't even understand that while you wait, the mentality of people there changes. 99% of people I know there - hate Ukraine by now.

Even though they tried moving here, last year. But by now they came back - Ukraine rejected them, abandoned them. There were no jobs, nowhere to live. Nothing for them here.

Right now, 15-year old kids - go, check it out on [Facebook] - they are with AK-47s. In a year, they'll grow into fighters.

And you are still talking. Why aren't you doing information warfare?
...
Since we're on the subject - yes, everything he said is true. Army is fed only by non-state contributions.

The state supply is inadequate. Snicker all you want - I'm at the frontlines, you're at the HQ, I know what I get.

UAF officer: I've been there for months.

Nikolai: Yes, but in HQ, not in the trenches.

UAF officer: I've been in Debaltsevo, Lutugino!

Nikolai: Me too, so don't tell me tales. I've seen how the guys were clothed. Yes, we had lots of army rations - but good luck eating even one.

UAF officer: I've eaten them! 56th brigade!

Nikolai: Sure, whatever. The main thing is: This war could be won without killing anyone. At all.

We'll hold the frontlines. But we ask our government: What have they accomplished over a whole year?

What about corruption? You doubled it. Everything Yanukovich did, you're doing twice more.

All the generals are only concerned with embezzling.

So you need to ask yourself - what have you accomplished?

You guys gathered in an important building, and other than sending [the Army] somewhere, you aren't capable of anything.

Why did you come there? What for? Do you have any answer?

===

PS. From the translator: A couple of my friends, Ukrainian and Belorussian, would often argue about politics. The Belorussian would always win by saying: "Name one good thing that the new Kiev government did. And if they don't do anything good - this means everything they do is bad, right?"

PPS. Also, this post is relevant. Ukraine is waiting for someone, anyone, who is ready to offer a way out of this mess. It is abundantly clear there are no such people among the usurpers in Kiev.

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 #42
RussEurope
http://russeurope.hypotheses.org
June 7, 2015
Ukraine: what remains of Minsk?
BY JACQUES SAPIR
Jacques Sapir is a noted French economist and Russia expert, who teaches at Ecole des Hautes Etudes en Sciences Sociales (EHESS) in Paris and at Moscow School of Economics. He heads the CEMI Institute (Centre d'Etude des Modes d'Industrialisation).
[Charts here http://russeurope.hypotheses.org/3950]

The situation in Ukraine and in insurgent areas of the Donbass is steadily deteriorating. This is proved by the clashes of the last few days, which, though limited, have certainly been the most violent since January 2015. The "Minsk 2" agreements are in a process of dissolution, and this largely due to the Kiev government. This was predictable. We must therefore review the situation in order to attempt to understand how we got here.

Ceasefire breaches

The ceasefire imposed as a result of the Minsk 2 agreement has never been fully respected. OSCE observers insist on the fact that these violations are, most often, the fault of Kiev's forces. The bombardments have, since the end of May, become steadily heavier, provoking the insurgent "counter-offensive" on Mariinka. But, after having taken control of this little town-from where spotters were directing the Kiev forces' artillery strikes-the insurgent forces did not press their advantage further.

President Poroshenko's June 4 speech in Kiev before the Parliament (Rada), in which he mentioned thousands, even dozens of thousands, of Russian soldiers in the Donbass, should be taken for what it is: propaganda.[i] Kiev has blatantly wanted to play the card of a strategy of tension to try and rebuild its international support which today appears to be disintegrating. The least that can be said is that this attempt has instead rebounded on its authors.

It is not these ceasefire violations alone which indicate a possible resumption of fighting. They are significant only insofar as they are set within the context of the non-application of the Minsk 2 agreement. Let us recall that Minsk 2 envisaged an important political component in addition to the military component (ceasefire, exchange of prisoners). This political component envisaged a de facto federalisation of Ukraine and respect for the territorial integrity of the country, by means of granting a very broad autonomy to the Donetsk and Lugansk regions. From the outset, the Kiev government has demonstrated a strong reluctance to implement the political component of the agreement. But if the implementation of the political component is not carried out, the military question necessarily resurfaces. It is because we are in a political impasse that there is the risk of a generalised resumption of fighting.

The War Party

Here it must be said that, on both sides, there are people pushing for this resumption of hostilities. On the side of the Kiev forces, various extreme-right, even openly fascist, groups are obviously pushing for a resumption of the fighting. Beyond the hope of winning victories on the ground, these groups have understood that they will not have any importance in Kiev's political arena without maintaining an atmosphere of hostility and conflict. Let the tension reduce, and these groups will be exposed for what they are: gangs of dangerous Nazi enthusiasts and nostalgists. Other forces throw fuel on the fire: these are certain oligarchs, who make up the backbone of the Kiev régime, and who seek to prosper on military aid (American in particular). They also have an interest in a resumption of fighting.

On the side of the insurgents, there are groups of people who regret that the forces of the DPR and the LPR were not able to press their advantage in September 2014. At that point, Kiev's army was completely routed. It would have been possible to retake Mariupol, even to push towards Kherson. If the DPR and LPR forces' offensive halted where it did, this was due to Russian intervention. The Russian government made it clear to the insurgents that they had to stop. Here is found one of the paradoxes of the Ukrainian crisis: the countries of the European Union, and the United States, should have taken into account this attitude of Russia's. This was not done at all, which contributed in no small part to convincing leaders in Moscow of the bad faith of their interlocutors. If relations today are truly difficult between these countries and Russia, this is equally the result of their attitude towards Russia at a time when the latter did everything to calm the military situation.

Moscow's relations with the DPR and the LPR are complex. Those who want to ignore an autonomy of decision-making in Donetsk (more so than in Lugansk) are making a serious mistake. Naturally, the leaders of the DPR and the LPR seek to be on good terms with Moscow, but their objectives do not necessarily coincide.

Life Under the Status Quo

Without an implementation of the political component of the Minsk agreement, life tends to organise itself around a de facto independence of the Lugansk and the Donetsk regions. And it is clear that this life is anything but easy. The total population of the areas under the control of the insurgents is approximately three million, including around one million who are refugees in Russia. The persistence of fighting along the front line prevents for now any serious efforts at reconstruction, with the exception of the re-establishment of the railway line between Lugansk and Donetsk. One of the reasons, moreover, for the maintenance of fighting and incessant ceasefire violations by Kiev forces, is the openly avowed will of Kiev leaders to keep the population of the Donbass in major insecurity and in an atmosphere of terror.

The Kiev government has suspended the payment of benefits and pensions, which amounts, after a certain fashion, to an acknowledgement that it no longer considers Lugansk and Donetsk as falling under its jurisdiction. Let us recall, besides, that the Russian government had always maintained benefits and pension payments to Chechnya throughout the period when Dudaev had proclaimed the so-called independence of that republic. It can be said that the Kiev leadership has not weighed all the legal implications of this action. One of the points of the Minsk 2 agreement was precisely to ensure the resumption of these payments. Needless to say, Kiev continues to oppose this. The population is largely dependent on Russian humanitarian aid. Minimal production continues to come from the coal-mines and some factories. Until December, this output was sold to Kiev. Subsequently, after the destruction by Kiev forces of the railway line, these sales were interrupted and were replaced with sales to Russia.

Let us stress this point: it entails a progressive scarcity of the hryvnia in the Donbass and a rise of the Russian rouble. Moreover, considering the greater solidity of the rouble compared to the hryvnia, the rouble has overwhelmingly become the instrument of savings and the unit of account in the Donbass. Now, the question of the circulating currency is eminently political. The choice for the authorities of the DPR and the LPR is therefore between three solutions: to preserve the hryvnia (and to recognise that the DPR and the LPR are autonomous republics within the framework of Ukraine), to go over to the rouble, which would take on the dimensions of an annexation by Russia, or to create their own currency, and claim their independence. This last solution is not impossible. The Baltic states, before adopting the euro, each had their own currency. But it raises problems that are extremely difficult to resolve. In reality, surrounding the question of currency is the question of the institutional future of the Donbass. For now, the authorities in the DPR and the LPR are preserving the hryvnia. However, the scarcity of notes and the availability of roubles may well oblige them to change their opinion some months from now. It can be seen, then, what is at stake. Will Donetsk and Lugansk have the status of autonomous republics within Ukraine, for which the Constitution must then be revised, or are we moving towards a de facto independence, which will not be recognised by the international community? For now, Russia is pushing rather towards the former solution, whereas the leaderships of the DPR and the LPR do not hide their preference for the latter.

The Western Position

Faced with this situation which is deteriorating from the lack of a will to put in place a political solution, a certain evolution has been noted these past weeks in the position of the United States and of the countries of the European Union.

The United States, through the voice of its Secretary of State, John Kerry, insists henceforth on the necessity of Kiev applying the Minsk 2 agreement.[ii] Very clearly, the United States does not intend to carry the burden of Ukraine, whose economy is disintegrating and which could, in the coming days or weeks, default on its debt, as the failure of negotiations with private creditors seems to indicate.[iii]

Ukraine, which is experiencing runaway inflation for these last months, and whose production could fall by 10% in 2015-after a fall of 6% in 2014-is desperately in need of massive aid. Now the United States has no intention of providing it. It [the US] is turning to the European Union, but this last is itself also more than reluctant. Of course, the Secretary of State for Defense, Ash Carter, insists that new sanctions be enacted against Russia.[iv] But this is more to put on the record the now recognised ineffectiveness of the previous sanctions.

The French position has begun to change over these last months. Not only does it begin to be recognised at the Quai d'Orsay that the question cannot be resolved into a confrontation between "democracy" and "dictatorship", but a real fatigue begins to be felt, in certain declarations, in regard to the positions of the Kiev government which does nothing to apply the Minsk agreements. One begins to regret, no doubt too late, being entered into a diplomatic logic dominated by the EU institutions, which give a weight out of all proportions to the positions of the Poles and the Baltics on this topic. The European Summit of May 21-22, held in Riga, in fact sounded the death knell both of Ukrainian hopes as well as of certain firebrand countries within the EU.[v]

Germany too is beginning to shift on this question. After having adopted a hysterically anti-Russian position for months, she appears to have been wrong-footed by the United States' change of position. She quite clearly perceives that if the latter succeed in foisting the Ukrainian burden on to the European Union, it is Germany who will have the most to lose from this logic. It is extremely interesting to read in the results of the Riga meeting that the application of the Free Trade Agreement-or Deep and Comprehensive Free Trade Agreement (DCFTA)-is henceforth subject to a trilateral agreement. Two of the parties being obvious (the EU and Ukraine), one can only think that the third party is Russia, which is to recognise the interests of the latter country in the agreement to bind Ukraine to the EU. In fact, we have returned to the situation demanded by the Russians in 2012 and 2013, but this after a year of civil war in Ukraine.

It thus seems that only Great Britain continues to support an aggressive position towards Russia, whereas in other capitals it is rather the weariness with corruption, the incompetence and the political cynicism of Kiev which dominate.

Russia in the Position of Arbiter

The latest events demonstrate that Russia is in reality in the position of arbiter in the case of Ukraine. The official position of the Russian government is to demand the full application of the Minsk 2 agreements. However, on the other hand, it knows that time is on its side and it could be tempted to let the situation fester.

Incapable of self-reform, prey to a dramatic economic crisis, Kiev is already plagued by increasingly serious problems. The war of oligarchs which is being conducted in the shadows clearly shows that within the governing alliance in Kiev, important divergences exist. The nomination by President Poroshenko of the former President of Georgia, Mikheil Saakashvili-the man responsible for the 2008 war in South Ossetia, and who is wanted for abuse of power in his own country-as governor of the Odessa region demonstrates that Kiev avoids like the plague the great Ukrainian feudal lords who are prone to changing allegiance from day to day. A recently conducted survey shows that Poroshenko's popularity differs greatly between the West and the East of the country. The events of the past eighteen months have in no way eliminated Ukraine's political and demographic heterogeneity.

The reality of the country, a varied and fragile nation, traversed by important conflicts, can be hidden for a time by repression and terror, as has been the case these last months. However, these practices do not resolve anything and the problems remain.

But, above all, even the Ukrainian government understands the determining economic role played by relations with Russia until 2013. Without an agreement with Russia, Ukraine cannot hope to recover and reconstruct itself. This, the Russian government also knows. Russia thus knows she is going to win, be it with a Kiev government that becomes progressively more sensitive to her arguments, or be it through the collapse of Ukraine. She would prefer to win at the lowest cost but, be sure of it, she will not skimp on the price to pay for this victory. Let us recall the stanzas of the poem, The Scythians:

 
Russia is a Sphinx. Rejoicing, grieving   Россия - Сфинкс. Ликуя и скорбя,
And drenched in black blood,              И обливаясь черной кровью,
She gazes, gazes, gazes at you...           Она глядит, глядит, глядит в тебя...

[i]     On the question of Russian forces in the Donbass and the "threat" to Ukraine, please refer to the testimony of General Christophe Gomart, Director of Military Intelligence, before the Committee of National Defence and the Armed Forces, March 25, 2015, http://www.assemblee-nationale.fr/14/cr-cdef/14-15/c1415049.asp (in French).
[ii]   Helmer, J., 19.05.2015, http://www.nakedcapitalism.com/2015/05/john-helmer-how-angela-merkel-has-been-abandoned-by-john-kerry-victoria-nuland-and-vladimir-putin.html
[iii] Karin Strohecker and Sujata Rao, "Ukraine and its creditors far from an agreement on debt", Thomson-Reuters, June 6, 2015 http://fr.reuters.com/article/businessNews/idFRKBN0OM0B920150606 (in French).
[iv]  http://www.challenges.fr/monde/20150606.REU6999/ash-carter-souhaite-d-autres-mesures-contre-moscou-sur-l-ukraine.html (in French).
[v]    See the final resolution, https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CCIQFjAA&url=http%3A%2F%2Fwww.consilium.europa.eu%2Fen%2Fmeetings%2Finternational-summit%2F2015%2F05%2Friga-declaration-220515-final_pdf%2F&ei=gKJzVa37EYHzUuaZgOgF&usg=AFQjCNGfquDo8LICKmmHa2Ha5YTiK59goQ&sig2=oX8K5A9AlRx3LYADkd39MQ&bvm=bv.95039771,d.d24&cad=rja (link to pdf download).

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 #43
The Unz Review
www.unz.com
June 6, 2015
Novorossiya Sitrep June 5, 2015
By ANATOLY KARLIN
[Text with links here http://www.unz.com/akarlin/novorossiya-sitrep-1/]
 
This is the first post in a new series that I intend to do in 1-2 week intervals every Friday. Just like Patrick Armstrong does with his RF Sitreps on Russia Insider, these sitreps are intended to cover both developments in the ongoing War in the Donbass.

Assassination of Alexey Mozgovoy

On May 23, the cortege of Mozgovoy, the second most powerful man in the LNR (Lugansk) after President Plotnitsky, was shot up and he was killed along with his press secretary, driver, and bodyguards. Responsibility remains unclear. The pro-Kiev partisan organization Teni ("Shadows") claimed responsibility, but since it frankly exists more on Facebook than anywhere else, that is unlikely. The LNR itself blamed Ukrainian special forces, accusing them of seeking to undermine the Minsk Accords. This is a bit likelier, but there is no clear motivation for it, and it is not obvious that Ukraine has the capacity to mount a special operation of such complexity deep in the enemy rear. Objectively speaking, the most likely culprits - and this is an assessment shared by many ardent Novorossiya supporters as well as its enemies - is either Plotnitsky, the Kremlin, or both.

He was long a thorn in the LNR's side, on bad relations with Plotnitsky personally, for his independent, populist stance and uncompromising opposition to the Minsk Accords. He wanted to press the war on until Kiev's liberation. But paradoxically, he also enjoyed a degree of support in the rest of the Ukraine greater than that of the other separatist leaders because of his reputation as a "genuine" person, and his stance that both the people of Donbass and Western Ukraine had a common enemy in the form of Ukraine's oligarchs and political elites (one of the few things that most of Ukraine can agree on). His populism and uncompromising stance was painted by his enemies as a kind of Orthodox extremism. His most infamous stunt was presiding over a "people's trial" of a rapist who was sentenced to death (though the sentence was never carried out), and expressing ideas about the proper role of women that are, how should we put it... would have been considered unremarkable in the 19th century (though in his defense, that particular comment was clearly meant to be sarcastic).

If so, this would not be the first assassination of its kind. The warlord Alexander Bednov, nom de guerre Batman, was killed under similarly shady circumstances this January. If so, this would make it part of a ongoing project to centralize power in the breakaway republics, with the Byronic idealists who drove the initial rebellion getting displaced by toady but effective political managers vetted by Moscow. (Igor Strelkov, unlike Batman and Mozgovoy, was probably wise getting out when he did, assuming himself guaranteed invitations to Russian nationalist talk shows and conferences for life and acquiring himself a hot young wife in the process). In his case, Buronic in the literal sense: He was also a surprisingly decent poet, and as it turns out, a tragically prophetic one, too (translation by Gleb Bazov):

It is a gift to die in May-
An easy task to dig a grave,
And nightingales will sing their song
Inimitably, like their last.In May, the thunder of storms supplants
A funerals' dismal songs and sounds,
And rain that comes instead of tears
Dissolves the memories' regret.The shelt'ring barrow of the grave
Beneath the emerald of grass;
A cross is a redundant mark
Among a grove of weary birch.Beneath the rustling newborn leaves,
With irrepresible thirst for life,
The sun has yet to burn the grass,
And every thing is animate.It is a gift to die in May,
To stay behind in vernal dew.
And though I could not do it all,
There are no doubts where none remain...
It is a gift, to die in May...    Не плохо в мае умереть,
Могильщику копать удобно.
И соловьи всё будут петь,
В последний раз, так бесподобно.Под грохот первых майских гроз,
Вместо унылых отпеваний...
И дождь, прольётся вместо слёз,
Он смоет грусть воспоминаний.Могильный холмик приютит,
Под покрывалом трав зелёных.
Пусть даже крест там не стоит,
Среди берёзок утомленных.Под шелест листьев молодых,
Что только к жизни потянулись.
Пока ещё нет трав седых,
А только, только всё проснулось.Не плохо в мае умереть...
Остаться в свежести весенней.
И хоть не смог я всё успеть,
Но не осталось уж сомнений...
Не плохо, в мае умереть...

Saakashvili appointed head of Odessa oblast

See my main article here.

In short, Saakashvili's legend is mostly a con: His achievements in improving the economy and corruption are both massively overstated, Georgians are leaving his "Switzerland of the Caucasus" at an unprecedented rate, and his political and military decisions were complete flops. He is however good at running cargo cults in relation to the West. At least in that respect he's the real deal. How much more pathetic is it that Ukraine is making a cargo cult of a cargo cultist?

Renewed fighting in Maryinka

This week saw the most severe uptick in fighting since Minsk 2, with the hottest action taking place in Maryinka on June 4 where the NAF launched a largescale counterattack in response to Ukrainian attempts to take the area a couple of days previously. In the familiar pattern, both sides accused each other of breaking the Minsk Accords, and as per usual, both were correct.

These events were the single bloodiest since the Debaltseve cauldron. Regime forces claimed 5 of its soldiers dead versus 80 separatists. The separatists in their turn said they suffered 20 dead to the junta's 400. Colonel Cassad, a pro-Novorossiya but militarily objective analyst with contacts on the ground, said the higher figures are more likely, reporting that just one NAF unit whose representatives he spoke with suffered 25 dead by itself, while total regime losses were estimated at 200.

~Note on Casualties

At this point, a little aside about casualties in general, for reference in future discussions.

Both sides in this conflict have sought to minimize their own casualties, while maximizing those of their enemy. Done for obvious propaganda reasons, this has frequently reached the level of farce, both on the Ukrainian side and on the Novorossiyan side. While the "official" death count for both sides is currently at around 2,000 I suspect the real figures are probably 2x-3x higher, since "real life" accounts from both sides that I have observed during this conflict seem to very consistently paint a much bloodier picture than official figures.

Be that as it may, the one thing that I will argue that we can be relatively sure of is that regime and separatist losses are approximately equal. This is dictated not by any detailed tallying or anecdotal impressions but by basic military theory. Given some rudimentary knowledge of force concentrations, equipment, attack/defense status, and the intrinsic quality of the troops (or combat effectiveness value to use the technical jargon), you can make fairly reliable predictions about relative casualties. Applying this to the Donbass conflict, the first two are broadly equal, with the NAF now as well armed as the Ukrainian forces thanks to Russia's military surplus stores, though the Ukrainians still probably enjoy a quantitative edge. But this is irrelevant for most engagements since what matters is achieving a preponderance of firepower at the local level, and neither side is very good at that because neither side has the capability to wage true combined arms warfare (Russia does, and the Ukrainian military would be crushed within days were it to ever overtly invade. This was true in April 2014, and it remains true today).

The NAF is usually on the attack, which is bad, since the standard casualty ratio for attackers against prepared positions with everything else kept equal is 1.3:1, rising to 1.5:1 against heavily prepared positions. Hence the high casualties incurred by the NAF in the monthslong and strategically dubious assaults on Donetsk Airport. Overall troop quality is low on both sides, though by all accounts morale is much higher in the NAF. (Contrary to sensationalistic reports of Pskov paratroopers getting massacred in their thousands by Ukrainian cyborgs at the Airport, the Russian Army has for the most part avoided direct involvement in the fighting, limiting itself to logistical and informational support. The only two major exceptions to this pattern coincided with Ukraine's two biggest defeats - the Ilovaysk and possibly the Debaltseve cauldrons).

In short, adding up all these factors, neither the UAF nor the NAF has a clear advantage, so the logical conclusion is that - whether they are closer to 2,000 or to 6,000 - casualties on both sides are broadly similar. Incidentally, this conclusion is backed up by POW counts. POWs are harder to hide than military losses. As of March 2014, some 1,800 separatists were under or had passed through Ukrainian captivity, versus 2,800 Ukrainians. This discrepancy is likely mostly or entirely explained by the higher morale of the NAF, which presumably lowers the proclivity to surrender.

Transnistria blockade

Transnistria, including the big Russian military base there, is now fully blockaded on both sides. Any resupply will now have to take place by air. S-300s have been moved to Odessa, and Saakashvili has been made its governor. There are rumors - so far as I'm aware, only rumors so far - that Ukraine is building up forces along the Transnistrian border.

All pretty ominous, and worth keeping an eye on.

I don't think anything really serious will come of this in the foreseeable future, but then again, you can never overestimate the insanity of the Maidan ideologues.

The End of Novorossiya?

Novorossiya as a political project has been officially frozen, ostensibly because it is incompatible with Minsk 2. Pro-Ukrainians gloated and rejoiced. Pro-Novorossiyans wailed over yet another "betrayal," ironically mirroring nationalist Ukrainian discourse centered around це зрада чи перемога (is this betrayal or victory?).

In reality, Novorossiya as a political project died out sometime around April 24, 2014, when Putin decided against repeating the Crimean scenario in Eastern Ukraine in a meeting with his top siloviki. What use is a parliament for eight republics when only half of two of them are in said country in the first place? Since then, and especially since the appointment of Zakharchenko and Plotnitsky as heads of the DNR and the LNR in August, it has for all intents and purposes been running on empty. The two republics already possessed all the organizational structure they needed while Novorossiya's putative head, Oleg Tsarev, had no particular roots in or connections to the Donbass, and they had no particular wish to share power and funds with alternate structures especially once Novorossiya lost most of its Kremlin backing.

Nothing will substantially change on the ground. The People's Militias will continue fighting under the umbrella Novorossiya Armed Forces, with its blue on red Saint Andrew's cross flag. The plan now, as it has been since April 2014, is to federalize Ukraine through the Minsk process, guaranteeing the East wide autonomy which would serve to complicate Ukraine's integration with the EU and make NATO membership essentially impossible. Like it or not, but Novorossiya is superfluous to this. This is not a "victory," but nor is it a betrayal. It's an acknowledgement of today's realities.

Here are a few good articles which will provide a good background understanding of the political processes at play:

Stuffing the Rebels back into Ukraine - Paul Robinson
Ukraine: Confederal Solution Looms - Alexander Mercouris
Gaming the Ukraine Crisis - Leonid Bershidsky

Besides, there is one more very important thing that particularly panicky pro-Novorossiyans should take solace in: The completely uncompromising nature of the Maidan ideologues themselves, who absolutely refuse to negotiate with the DNR and the LNR anyway.

"We must ensure fair elections. And we will conduct dialogue with the Donbass, but with a different Donbass, a Ukrainian one."

"The same position, but in even harsher terms, was expressed at the Forum by the Prime-Minister Arseniy Yatsenyuk. He is prepared to talk to the representatives of the Republics "only once they are behind bars." "By the way, we have enough empty cells," he added.

According to Yatsenyuk, his government will never deal with the current representatives of the Donbass. "We will communicate only with legitimate representatives of this region, and we want to conduct legitimate elections there," said the Prime-Minister.

Poroshenko also stated that in Ukraine there is no internal conflict whatsoever. "We have no internal conflicts," said Poroshenko. "On the contrary, Ukraine has now become more united than ever."

"I will do everything possible to ensure that neither language, nor faith, nor the questions of land, nor NATO, nor any other questions split Ukraine," promised the President. "The second language in schools and universities in Ukraine should be English, not Russian."

You don't need friends with enemies like these.

Right Sector angry about DNR gun rights - DNR legalizes virtually all firearms and Right Sector has a hissy fit about it.

"That's right! The freaks in the DNR are allowed to have guns, while Ukrainian citizens have to call for help from useless cops."
"This sneaking suspicion that it is Motorola and Givi who are the ones fighting against bureaucracy..."
"This is shameful. :("
"Checkmate, bitches? And if the Rada now buries the proposed law about civil firearms possession, maybe we could join the DNR under conditions of autonomy... :("

In short: Good on the DNR.

And excellent trolling material against the Right Sector and sundry stormfags who claim they are defending Europe against totalitarian commie orcs.

MH17 Developments - Frankly I haven't studied this issue in any depth and don't have a strong opinion on it either way. Still it's clear there's tons of problems with the official narrative:

'Reuters lied': MH17 witness says reporter falsified testimony

German Image Forensics Expert Scoffs at Bellingcat's Allegations of Doctored MH17 Photos

War crimes by Right Sector punitive batallions - Openly and proudly documented by one Yashka Tsygankov, a Right Sector militant, on Facebook. They attacked a DNR blockpost, killing everyone except for one person who surrendered. Here he is in captivity:

I suppose it is theoretically possible that his two trigger fingers were blown off in the firefight while leaving no other visible injuries. Of course if you believe that you will believe anything. This kind of action was prevalent in the Yugoslav Wars and is the very definition of a war crime. Of course this being committed by the West's lapdops means that Facebook will not censor it (unlike say Graham Phillips, who has been blocked from posting to Facebook many times now for posting things like the victims of Kiev's shellings) nor will their be any outcry in their media about it.

In fairness, it should be noted that he denies being tortured. But he is in captivity in some dank, dimly lit basement. So his words can't be reasonably taken at face value. EDIT 6/6: He has since been exchanged in a prisoner swap, and in an interview with Patrick Lancaster released just now, he has now confirmed that Right Sector did in fact cut off his index fingers (so also makes clear that previous interview was under duress, which makes Ukraine's Channel 5 also complicit in this war crime). In response to his maiming, he said that it reinforces his belief in the justice of the Novorossiyan cause, that it is all entirely on the conscience of his captors, and that he intends to rejoin his squad and learn to shoot without his index fingers.

Want your wages? Have a call-up paper instead - Workers at a Kherson oblast plant picketing the Rada over nonpayment of their wages - the factory's owner having become a deputy - were instead presented with mobilization papers. Recipients included disabled workers, as well as specialized workers without whom the plant would be unable to function. Corrupt deputies, unrestrained oligarchy, farcical pressganging, and the wholesale destruction of labor rights are all kind of everyday occurences in post-Maidan Ukraine, but it's still somewhat remarkable when they all come together in such a perfect confluence.

IMF comes a-calling - Yatsenyuk happily obliges.

Ukraine has stopped paying out welfare payments for pensioners, World War Two veterans, people with disabilities, liquidators of the Chernobyl disaster beginning with Monday, since the law of December 28, 2014, on stabilizing the financial condition of the state has come into force. It affects practically all social security beneficiaries, without defining the mechanisms for providing targeted assistance to low-income groups.

Kiev has eliminated transport, healthcare, utilities and financial benefits for former prisoners of Nazi concentration camps and recipients of some Soviet-era orders and titles. Compensations to families with children living in the areas contaminated by radiation from the Chernobyl accident will be no longer paid either.

Stories from Oles Buzina - Translation of a 2009 article by the anti-Maidan journalist, slain by Maidanite orcs with the complicity of the Poroshenko regime and to Western indifference, by Nina Kouprianova: The SS Galizien versus Ukraine. Here are a few quotes from it:

"One of the neo-Nazi parties that currently preaches the tradition of SS Galicia Division in Ukraine calls it the "treasure of the nation." Which nation, I wonder. Like the Austrians during the Habsburg days, Germans did not place much value in the Galicians as war material. If in the Russian army, the natives of Ukraine became generals and field marshals, then in the Austrian one, they became junior officers, at best. An Austrian, Hungarian, or a Croatian native could have a brilliant military career in the Habsburg Empire, but not Galicians. ...

"Not only the commanders of Galicia Division were German, but also the entire headquarters and the vast majority of officers all the way to the company members. Brigadeführer Fritz Freitag led the Division. Major Wolf-Dietrich Heike ran the operations department. Intelligence was under Hauptsturmführer Fritz Niermann. Supply department-under Hauptsturmführer Herbert Schaaf. Sturmbannführer Erich Finder was the Commander's aide. Friedrich Lenhardt and Herbert Hähnel were assignments officers. Karl Wildner, Hans Otto Forstreuter, Paul Herms, Karl Bristot, and Friedrich Beyersdorff commanded the regiments. Even the pharmacist was German-Hauptsturmführer Werner Benecke (not to be confused with any Beniuk [a Ukrainian name-ed.] by any means!). According to Andrei Bolianovskii, the Division "got a German command spine." ...

"The Germans filled Galicia with new soldiers from among those volunteers that they initially rejected, no longer embarrassed of their height, but ones who were almost never used in open battles against the regular units of the Red Army. The main task for these "divisioners" was fighting Slovak and Yugoslav guerrillas. Once Galicians even had a skirmish with Ukrainian partisans under Kovpak, who carried out a sabotage raid into Slovakia.

"German command valued the military qualities of SS Galicia very little. For example, only one of its members was awarded the Iron Cross-Commander Freitag himself-whereas these awards were not uncommon in other Waffen-SS divisions."

But really worth reading in full, not only to see what Buzina was about, but because it is pretty interesting and eye-opening stuff, and you can really see why it would incite such raging murderous hatred on the parts of Ukrainian nationalists.

Poroshenko Corruption - Curious that it is the RFERL writing about this: Questions Raised Over Poroshenko's Role In Valuable Kyiv Land Deal.

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 #44
Kyiv Post
June 8, 2015
Moskal sends prosecutors list of 65 crimes committed by Aidar Battalion
by Allison Quinn

Luhansk Governor Hennadiy Moskal given prosecutors a list of 65 crimes allegedly committed by members of the Aidar Battalion, a volunteer force fighting on the front line that he has frequently described as a group of marauding bandits.

The list of crimes includes "a mass of incidents of kidnapping, extortion, torture, robbery and the illegal use of weapons" along the front line, Moskal wrote. His allegations come days after the battalion's former commander, Sergei Melnichuk, was stripped of his parliamentary immunity by the Verkhovna Rada.

Melnichuk, of the "People's Will" faction, now faces charges for the illegal formation of armed groups, although the Verkhovna Rada stopped short of approving his arrest on June 3.

"Once again, I would like to stress that part of Aidar is actually defending the territorial integrity of Ukraine on the front line, with weapons in their hands, while another part has decided to make money off of war. In the list, only 25 percent of the crimes are heinous and high profile -- including kidnapping civil servants and demanding ransom, resisting the work of law enforcement bodies and robbing entrepreneurs, etc.," Moskal wrote on his official website on June 8.

Moskal claims that many members of the volunteer battalion were not officially registered at the time the crimes were committed, though they were nonetheless given weapons and Aidar badges while Melnichuk was in charge.

In total, the list includes 65 separate crimes, all of which took place throughout 2014. In the online statement, Moskal explained the list's publication by saying the Verkhovna Rada had given consent to investigate crimes committed only in the Kyiv and Zhitomorsk regions, not Luhansk.

"But victims (of Aidar's crimes) and their relatives appeal to me every day, asking if the perpetrators will ever be punished," he wrote. "What am I supposed to tell them, that Melnichuk will be charged only for (crimes) in Kyiv and Zhitomirsk?"

The General Prosecutor's office has accused Melnichuk and several members of the battalion of attacking private enterprises in the Luhansk Oblast, an allegation which Melnichuk has denied.

Melnychuk was unavailable for comment on the latest allegations against him. In an interview with Ukrainian media days earlier, however, he scoffed at the accusations.

"From the very first day (of the conflict), we were a part of the armed forces, and the accusation that we created an armed gang ... well then that means the Defense Ministry created an armed gang, that it was initiated by (Sergei) Pashinskyi, as the General Prosecutor explained that whoever took part in this gang is a member of it. There were so many volunteers all over Ukraine; this means they were all members of a gang, apparently," Melnichuk said in an interview with television channel 112 Ukraine on June 2.

Mykola Grekov, an Aidar officer in Luhansk, told the Kyiv Post that Aidar insignia could easily be purchased by ordinary people, meaning anyone could impersonate members of the group and commit crimes.

"Everyone thinks there is some conflict between Aidar and Moskal, but that's just not possible. We work together, we are subordinate to him. He was just presenting information that was presented to him (with this list of crimes), and if it is proven that these crimes were committed by Aidar members, they will face charges," he said.

"But we are a part of Ukraine's armed forces, not some gang of bandits like people think," he said.

The Aidar Battalion has found itself at the center of several scandals in the region, including the alleged armed takeover of a bread factory, which Moskal in April asked the Defense Ministry to liberate from the "armed militants," who he said had been stealing money and tearing up equipment.

In mid-March, Moskal said three members of the battalion had drunkenly burst into a resident's home before beating up the owner and orchestrating a shoot-out in the street.

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 #45
www.thedailybeast.com
June 8, 2015
Want to Get Really Mad About Ukraine? Watch Russian TV
The daily diet of the Kremlin's 'weaponized propaganda' is not all lies-and it's heating up Russians' outrage over the war in Ukraine and the West's role.
By Anna Nemtsova

MOSCOW -  A recent survey by Russia's Public Opinion Research Center found that 60 percent of the Russian population gets its news from television and 75 percent trust what they see there.

Well, here's what they've been watching.

Last Thursday every news program on Russian television aired video of wounded, bleeding women and men on stretchers at Donetsk hospital, and images of a destroyed city market set on fire by artillery during one of the fiercest battles in Ukraine in months. The shelling of Donetsk region intensified, and Russians could see many ruined private homes under fire. News presenters blamed the Ukrainian military for creating over 50 "provocations" endangering the ceasefire along the entire front line in Eastern Ukraine. It blamed Kiev's leadership for breaking the Minsk agreement from last February, and it blamed the West for backing Ukraine.

Thursday's news reports covered clashes the day before in the fight for control over a town called Maryinka (also, Marinka), right outside the regional capital of Donetsk, that involved heavy artillery and tanks. Over 20 people were killed and at least 100 were injured in separatist-held towns, the reports said. The Ukrainian military deliberately chose sunset to shell the thickly populated town of Horlivka, Channel-5 reported. Vesti, a news program on the popular Russia-24 channel, quoted separatist Deputy Defense Minister Eduard Basurin insisting that Kiev plotted the attack on purpose. He claimed the Ukrainian military wanted to have a small victory to show before Ukrainian President Petro Poroshenko addressed the Rada, or parliament. But "Kiev failed," said Basurin. And the majority of Russians believed it.

Day after day, Russian television viewers discuss horror stories from Ukraine. After a short and largely quiet break, clashes have intensified on the front lines, and as they've grown increasingly violent, outrage against Ukraine's military and its leadership have been heated up by the anti-Kiev and anti-West news coverage.

One heartbreaking story, particularly, has made many Russians shed tears. In a recent shelling incident at Horlivka, near a strategic crossroads just north of Donetsk, artillery hit the private home of the Tuv family. Several Russian channels broadcast interviews with Anna Tuv, a soft-spoken mother of three. She described how she found herself with here arm "torn off" after the explosion. It later was amputated up to her shoulder. She told how she dug her still-living 10-day-old baby girl from under the rubble and found her two-year-old son Zakhar wounded with shrapnel but alive. Then she saw that her husband Yuriy and their 11-year-old daughter Katia both had died. They were "torn into pieces" by the shelling, she said.

"I had goose bumps, when I saw poor Anna from Horlivka," says Ruslana, a waitress at the Shokoladnica café on Pokrovka Street in Moscow. "That night I could not sleep and was thinking of the poor woman, how her life was destroyed in a few seconds."

A majority of Russians, up to 47 percent, followed closely or very closely the Russian television news about the Ukraine crisis, according to Denis Volkov, a sociologist and independent pollster at the Levada Center, and 38 percent more follow the news without paying much attention. "A majority of Russians, up to 66 percent, believe that the war does not end because the West, Europe and largely the United States, back up Ukraine, and only 6 to 7 percent say that the war goes on because Russia's leadership backs the rebels," Volkov said.

Pro-Kremlin television continues to deny all allegations that there is a Russian professional military presence in Ukraine, convincing Russian viewers that all Western publications suggesting otherwise are just waging psychological operations against Moscow.

"According to our information, 25 US experts in information war recently arrived in Kiev," pro-Kremlin activist Sergei Markov tells The Daily Beast. "Black and white" doesn't begin to describe the situation, he says: "There are just the absolutely kind people of Donbas, and the absolute evil destroying them-Kiev backed by the West."

As Washington searches for ways to counter what one Pentagon official described as Russia's "weaponized propaganda," the Russian people have lived the last year feeling that Kiev's "absolute evil" is on the march.

It has to be said that independent international observers do confirm some Russian TV reports, or at least parts of them.

One striking example: An Organization for Security and Cooperation in Europe (OSCE) patrol visited Anna Tuv's largely destroyed house in Horlivka. The OSCE confirmed to The Daily Beast that Anna's husband and 11-year-old daughter were killed immediately, that Anna did lose her arm and was staying at the hospital with her two-year-old son, who is severely injured, and her two-week-old daughter, who has minor injures.

So Russian television was right about that much. But, then, there's this.

The Russian television reports and locals in Donbas blamed the Ukrainian military for Anna Tuv's tragedy. But the official report from the OSCE says that the Ukrainian military alleged on that day, May 26, the "shelling of Horlivka came from Mine 6-7 (42 km north-north-east of Donetsk and 7 km north-west of Horlivka respectively)," in areas controlled by the separatist, Russian-backed Donetsk People's Republic.

It's often said that in any war truth is the first casualty. Unfortunately, it is rarely the last.

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 #46
Reuters
June 8, 2015
History becomes a weapon in Russia-West rift over Ukraine
By Jason Bush

MOSCOW (Reuters) - History has become a weapon in Russia's battle with the West over Ukraine as President Vladimir Putin looks increasingly to the past to whip up patriotism and rally support.

Last month's lavish commemorations of the defeat of Nazi Germany in World War Two, several declarations by Putin and new history textbooks have all presented what some independent historians say are slanted or rewritten versions of the past.

The Nazi-Soviet pact that divided Poland in 1939 - which saw Moscow seize much of what is now Ukraine, Belarus and the Baltic States - is now seen in a positive light. A new justification has been found for the Soviet-led invasion of Czechoslovakia in 1968 and some of Soviet dictator Josef Stalin's worst crimes have been played down.

"It is an aggressive stance in the debate over history," said Alexei Miller, a history Professor at European University in St Petersburg, who says all sides have been distorting the past during the conflict. "History is a victim of the current crisis in relations between Russia and Europe."

He says "wars of memory" are being waged with the West and ex-Soviet neighbours such as the Baltic states and Ukraine, where history is increasingly being interpreted in different ways to suit political views.

Putin, who denies Western accusations of sending troops and weapons to pro-Russian separatists in eastern Ukraine, has made clear that he understands the power of history.

This is perhaps not surprising for a man brought up in the Soviet Union, where history was vetted to glorify Communism, denigrate the West and denounce "enemies of the people".

"When we show that we are right and our actions benefit society, the state and people, millions of our supporters will appear," Putin said at a meeting with historians last November.

He has also taken a close interest in new history textbooks for schools which describe his own success in "securing social unity and agreement" at home while "consistently defending national interests" abroad.

Russian children will also learn in the new textbooks how Putin's Soviet and Tsarist predecessors repeatedly defended Russia against Western aggression and machinations.

The textbooks state as fact that the 1939 pact that divided Poland was a justified response to Western policies aimed at encouraging Adolf Hitler to attack the Soviet Union.

Putin has defended the pact several times, including during a visit by German Chancellor Angel Merkel in May, when he said it made sense "for defending the national security of the Soviet Union".

NEW LAWS

State media are an important weapon in Russia's information war with Ukraine and the West, which imposed economic sanctions on Russia after it annexed the Crimea peninsula from Ukraine last year. They are also part of the battle over the past.

Rossiya-1 television aired a documentary on May 23 which gave a new explanation for the 1968 invasion of Czechoslovakia, then part of the Soviet bloc, by Communist Warsaw Pact armies which crushed the Prague Spring, intended to create "socialism with a human face".

Citing what it called newly discovered documents, it said the invasion was needed to protect the country against a NATO-backed coup being planned under the cover of the Prague Spring.

Czech and Slovak officials said the programme distorted the facts. Slovakia's Foreign Ministry said Slovaks "refute all attempts at rewriting history".

During the crisis in Ukraine, Moscow has portrayed ethnic Russians or Russian speakers living in the former Soviet republic as threatened by fascists.

Russia has now introduced a law which criminalises the "rehabilitation of Nazism" and makes it punishable by up to three years in prison.

The law attracted attention when investigators opened a case against a 16-year-old for posting comments on social media they said praised Nazi Germany's invasion of Poland in 1939. Authorities have also used the law to open criminal cases against defacers of Soviet monuments, including in Ukraine.

Unlike similar laws in other countries, Russia's also criminalises "knowingly spreading false information about the activities of the USSR in World War Two".

The Baltic States and Ukraine have also passed laws about history. Ukraine has banned Communist symbols and made it a criminal offence to deny the totalitarian nature of Soviet rule from 1917 to 1991 or to question the legitimacy of anti-Soviet nationalist groups which at times cooperated with the Nazis.

STIFLING DEBATE

Critics see Russia's law as part of a growing pattern by authorities to stifle discussion about history and cover up negative chapters.

"Access to the archives is getting worse and worse," said Sebastian Stopper, a historian at Humboldt University in Berlin. "It's just politically desired for now not to shed light on crimes of the Russian state in the 20th century."

Stopper, an expert on Soviet partisans in World War Two, has fallen foul of an earlier Russian law against "extremism", after a court last year classified postings he made on the Internet as extremist.

He said his posts largely consisted of extracts from Nazi documents and included some of his own comments, which he says tried to explain German soldiers' mentality.

"Of course there was nothing justifying Nazi war crimes," he said. He said he suspected the real reason his research ruffled feathers in Russia was because it challenged previous claims about the partisans' effectiveness, long accepted as facts in Russian histories.

Miller said that a common perception in the West, that Putin is an admirer of the Soviet system and Stalin, was unfair.

Russian history textbooks do have sections dealing with the purges, famines, labour camps and deportations under Stalin - but they are typically quieter about similar Soviet repressions against other countries' citizens.

Some of Putin's recent pronouncements on history have been critical of former Communist rulers when he sees their actions as undermining Russia's international interests.

Last year he blamed the Soviet government for giving away what he said were traditional Russian territories to Ukraine in the 1920s. And in an implicit swipe at Lenin's Bolshevik revolutionaries, he said that victory in World War One "had been stolen by those who called for defeat of their Fatherland".

"Putin is obviously a Great Power man. For him this is the central issue of the Russian agenda: To preserve the status of a Great Power. From this perspective he is obviously critical of the Bolsheviks," Miller said.

But he added that, in the current standoff with the West, the state's interest in promoting public discussion and education about Stalinist crimes had waned.

"It is now more about the West as the enemy, more about the acts of aggression of the West against Russia in various historical periods."

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 #47
Wall Street Journal
June 5, 2015
Ukraine's Most Hopeful City: Lviv
In Lviv, the conflict with Russia can feel far away
By Anne Applebaum
Ms. Applebaum is a historian, journalist and the director of the Transitions Forum at the Legatum Institute in London.

On a recent evening in Lviv, the sound of a guitar and a Ukrainian singer drifted into my window. I leaned out and looked down: On the street below, two restaurants had occupied a narrow cobblestone passageway. Both were full. I heard clinking glasses, laughter, chatter, the sounds of a thriving city-and further proof, if more were needed, of why so many stereotypes about Ukraine are wrong.

Certainly, if you follow the Russian media, you would have to conclude that what I heard is impossible. Several weeks ago, Russian television dropped its claim that Ukraine is a Nazi state, replacing it with the claim that Ukraine is a failed state. Ukraine can't pay its debts, Moscow newscasters now argue. Ukraine's allies are drifting away, hunger approaches and the next revolution is on its way. Thanks to the incompetent nationalists, the people live in Hobbesian anarchy and fear.

By that reckoning, Lviv should be even worse off than the rest of the country. Lviv is in Galicia, the western slice of Ukraine that belonged to Poland until World War II and to Austro-Hungary before that. Since the 19th century, it has been an important center of Ukrainian nationalism and patriotism.

Perhaps because they had to compete with the Poles and the Jews who dominated the city before the war, Lviv's Ukrainians once built dozens of cultural and political societies, self-help groups and clubs. One of the most prominent buildings in the city center, just off the old market square, is a fine example of turn-of-the-century Vienna Secession architecture, but with Ukrainian folk motifs. Among other things, it contains what used to be a gymnasium, built to strengthen Ukrainian youth.

As the Soviet Union crumbled, the strongest push for Ukrainian independence came from Lviv. Kiev's Lenin statute lasted until 2013; Lviv pulled its own Lenin monument back down in 1990. On my first trip there in that same year, little knots of people would gather on the city's central plaza every evening to argue with one another and sometimes to shout. Blue and yellow flags were already ubiquitous, even though independence had not yet arrived.

Back then, there was still an uneasiness in Lviv. Although theoretically Ukrainian, the bureaucrats spoke Russian, and a lot of people who lived there came from elsewhere in the Soviet Union, having drifted into the city's half-empty townhouses after the war. Lviv seemed almost anachronistic, a piece of central Europe somehow cut off and stuck inside the U.S.S.R. A quarter-century later, that uncertainty is now gone, replaced by a clear sense that this is a Ukrainian city.

On the plaza where the little knots of people used to argue, the city has now built a statue of Taras Shevchenko, Ukraine's national poet. On the day I was in town, boys and girls, both in embroidered peasant blouses, were posing in front of the statue. They were taking selfies and commemorating the last day of school.

By themselves, the statue and the blue and yellow flowers at Shevchenko's feet wouldn't mean much. But the patriotic renewal that they signify has played a role in the city's economic fortunes too. In 1990, the city was waiting to be rescued by foreign investors who never came. In the two decades since then, far more change has come about thanks to better local government, strong local organizations and local businesses-as well as a growing, if not entirely rock solid, belief in the city's ability to enforce the rule of law.

All of these things are in turn now linked to Andriy Sadovyi, Lviv's current mayor. Over coffee one morning, Mr. Sadovyi told me that he believes himself to be the first Lviv-born, Ukrainian-speaker ever to run the city. In the past there were Poles or Germans or simply people who came from somewhere else: "But I know every stone, every building..." Mr. Sadovyi's political party, Samopomich-the name means "self-reliance"-is modeled very consciously on prewar Ukrainian civic groups, and he himself is firmly anchored in Ukraine's long tradition of civic activism, having run a Lviv city development fund before going into politics.

Mr. Sadovyi was elected in 2006, and his term in office has coincided with a visible change in the city's fortunes. During this time, Ukrainians finally began to invest in hotels, restaurants and other small businesses. Many of them had been working abroad, and their shop windows often point to their former homes, advertising "products of Turkey" or "clothes made in Poland." These small entrepreneurs had Mr. Sadovyi's blessing: "Ten percent of the world economy is connected to tourism and travel. Why shouldn't some of that business come to Lviv?"

The European football championships, held in Poland and Ukraine in 2012, helped to popularize the city internationally. Some of the matches were held in the Lviv stadium, and a few new luxury hotels were built in anticipation of rich foreign tourists.

But to everyone's surprise, most of the tourists are not foreigners but Ukrainians-and no wonder. Lviv has the ambience of Prague or Krakow, but without the prices or the crowds. Ukrainians can't go to Crimea anymore, and visas are tough. But in Lviv, you can eat a good meal for a few euros, go to the opera or just sit in the parks and watch people for free.

The city still has major obstacles to overcome, mostly created by the Ukrainian government. The Lviv city council doesn't control the licensing of new buildings, for example. Absurdly, those decisions are made in Kiev, as are all kinds of other decisions that in most countries would be made locally.

Mr. Sadovyi is doing his best to reshape what he calls the "Byzantine" politics of the Ukrainian capital. His party won a surprising 10% of the national vote in the 2014 elections and now controls 33 of the 450 seats in the parliament. But he is sanguine about what can be achieved in the near future: "Everyone is building parties for tomorrow. I am building for a decade." It may be a long time before Lviv's model works in the rest of Ukraine, which was part of the U.S.S.R. for much longer.

Meanwhile, the economic crisis is deepening, and there may come a time when Ukrainians haven't got the money to travel, even to stay in a two-star hotel in Lviv. But for the moment, it feels like a city in which things are happening. On one night last week, the Israeli ambassador to Ukraine was presiding over a jazz concert, while the Opera House was putting on a one-man play by Bernard Henri-Levy.

I was in town for the Lviv Media Forum, a combination conference and training session that now takes place in the city every year. There were 600 journalists in attendance, from all over the country, the vast majority under 30. All of those I met were enthusiastic and optimistic about the future of Ukraine, despite the overwhelming obstacles. Perhaps theirs is the generation that will finally overcome them.

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