Streetwise Professor

May 16, 2014

Going All Medieval in Ukraine

Filed under: Military,Politics,Russia — The Professor @ 8:32 pm

The NYT and Reuters are abuzz with stories about how Ukrainian oligarch Rinat Akhmetov has deployed his steelworkers to the streets of Mariupol, pushing out pro-Russian elements. Moreover, Akhmetov made statements that superficially seem to support the Kiev government, but which suggests that decentralization under a new constitution are the best way forward.

Be very, very suspicious. Saying that Akhmetov is untrustworthy is like saying that the core of the sun is pretty warm.

He rose to wealth and power during the early-90s, allegedly as an enforcer for organized crime elements in eastern Ukraine. He was a supporter of Yanukovych. There are allegations that he was a silent partner of Yanukovych’s son in a scheme to sell illegally mined coal that netted over $100 million. The Wikileaks cables include some more than unflattering references to him and his criminal connections.

In other words, he is as dirty as the soot spewing from the stacks of his steel mills.

Note that Putin and Russia appear to be unperturbed by developments in Mariupol, a sharp contrast to their hysterical reactions to attempts by the Kiev government to regain authority over the eastern provinces.

The Donbas scores a perfect 10 on the Sovok scale. Putin needs to have direct control over it like he needs a hole in the head. It suffices that Kiev does not control it. Another frozen conflict, a la Transnistria, South Ossetia, and Abkhazia, will serve his purpose, and he can no doubt reach an agreement with Akhmetov. And Akhmetov has no interest in direct Russian control. A Donbas that is not part of Russia spares Putin expense, and the headaches of dealing with the reprobates that are currently running wild there. But keeping the region on the boil undermines Kiev. It’s a win.

Pro-Maidan elements assert that Akhmetov was spurred to action not by the threat posed by the pro-Moscow rabble, but by the appearance of a pro-Kiev force from Dnipropetrovsk.

I don’t know exactly what Akhmetov’s game is, but he puts his interests first. He is not a Ukrainian patriot: he is a mobster and a thug. My guess is that Putin is happy to concede Akhmetov control over Donbas: he is much more biddable than the assortment of loons and lowlifes that comprise the Donetsk People’s Republic and the Luhansk People’s Republic. Akhmetov wants autonomy from Kiev, though he might pledge superficial fealty to it.

If you want a mental model, you could do worse than to harken back to medieval France, or medieval England during periods of weak monarchs or succession crises. Powerful local barons made formal pledges of loyalty to the monarch, but demanded virtual complete autonomy from central authority. They, and not the king, were the law wherever their writ ran. They schemed and fought to protect their property, and to take property and power from others. Outside nations pitched in to keep the country in turmoil and undermine the efforts of the center to bridle the barons.

Ukraine is cursed by its Sovok past, and the primitive capitalist accumulation that occurred upon the dissolution of the USSR. It is very close to Russia, and very far from God. People like Akhmetov have two goals: to protect the property and power that they secured through force and corruption, and to take additional property and power from other barons. Patriotism and principle have nothing to do with it.

Putin can exploit these circumstances to prevent Ukraine from forming a stable, unitary state that will move towards the west. He will reach agreements with the local barons.

There is every reason to be skeptical about the NYT and Reuter’s stories. Not the factual part, about Akhmetov dispatching legions of his laborers to assert control over parts of Donbas. But about the interpretation of his motives for doing so, and the implications of his actions. The western media appears locked into a simplistic narrative of Kiev vs. Moscow. Viewed through this lens, Akhmetov’s cracking down on separatists who are anti-Kiev must be anti-Moscow, and a separatist defeat must be a victory for Kiev and a defeat for Moscow. But it’s more complicated than that. The separatists have served a purpose for Putin-breaking up Ukraine-but he does not have a long term investment in them. A fractured Ukraine, with figures like Akhmetov exercising control over important regions can serve his long run purposes much better: he can reach accommodations with the Akhmetovs, whereas controlling the lumpenproletarians of the DPR is a much bigger headache. This works for Akhmetov too: indeed, his action followed close upon demands by the separatists that he pay taxes to them, so he has a strong incentive to put them in their place. But that doesn’t mean that he is acting in the interests of Kiev or the nation of Ukraine.

It took centuries for the French monarchy to suppress the local barons. Ukraine may become a modern, unitary state in a shorter time, but it isn’t going to happen soon.

There’s one other interesting angle here. The US has gone after one major Ukrainian oligarch: Dmytro Firtash, whom it is attempting to extradite from Austria. Akhmetov is as corrupt and criminal as Firtash, and indeed is closely associated with Yanukovych. But he seems under no legal threat from the US. Could it be that the US has decided that Akhmetov can facilitate a not war, not peace outcome that allows the US and EU to wash their hands of what is going on in Ukraine? That makes as much sense as anything.


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  1. Professor,

    I see that you’ve jumped off the “GRU-behind-everything” wagon.

    Akhmetov is no worse than Kolomoisky.

    I remember during the Orange revolution a BBC toff reporting from Donetsk, decrying its greyness, shoddiness. “How dare those morlocks raise their voice”. Yet these sovok “lowlife” earn most of Ukraine’s hard currency.

    Federalisation is Ukraine’s only hope. Because when you devolve the power, you also devolve the accountability. The local authorities have to answer for the empty coffers, shoddy roads, etc. This is how Yeltsin kept Russia together in the 90s. Edward Rossel, the governor of Sverdlovsk Oblast, wanted to issue his own currency at some point. Ditto Tatarstan. But then the ship was righted, Putin came along, and the devolution was reversed. I’m afraid the Kiev junta is either too stupid to do this, or they are all agents of Putin.

    Comment by So? — May 16, 2014 @ 10:09 pm

  2. So you are advocating federalization for Russia as well, I take?

    Comment by LL — May 17, 2014 @ 5:38 am

  3. Russia already is… in theory.
    I don’t advocate federalization for Ukraine.

    Comment by So? — May 17, 2014 @ 6:14 am

  4. You are correct, SWP, but you have omitted a few names – it’s not just Akhmetov and Kolomoisky.

    For years, the Donbas mafias have controlled Ukraine – and they have constantly talked not about Ukraine, but about “cила Донбас” – “strong Donbas,” coupled with propaganda about how Donbas feeds all of Ukraine by its economic production and economic strength.

    But the fact is, the Donbas mafiosi have sucked billions out of the Ukrainian economy, via various tax refund and other tax avoidance schemes, and by simply transferring money out of the country, as we saw recently with the massive exodus out of Ukraine right before yanukonvikt fled, via jets containing strong boxes – we know what those strong boxes contained.

    It is ironic that the Donbas mafiosi have invented the “Kyiv is not listening to us” mantra/propaganda, since they are the ones who were in parliament, directly or by proxy, and in government.

    And they did this in part via the list system of elections. One does not vote for individual candidates to parliament by region in Ukraine – one votes for a party list, and the Donbas mafia Party of Regions would typically garner the most votes.

    Akhmetov was a member of Parliament – but he never showed up. Then he figured that he no longer needed to even be elected. Typically, members of parliament have immunity as to any crimes. It’s been a longtime topic of discussion.

    also, he has hired US lobbyists and assorted media representatives in England and elsewhere

    In Ukraine’s corrupt political patronage system, regional governors and other regional officials are appointed, rather than elected.

    So yes, it seems to me that representative democracy requires election on a local regional basis, rather than via a party list system, or via appointment.

    In the meantime, victory by sanctions is being declared:

    Comment by elmer — May 17, 2014 @ 9:41 am

  5. @So? You need to get your eyes checked, or change your prescription, or seek professional help for delusions, because you are seeing things that are not there. I never even mentioned the GRU. Moreover, the entire thrust of the piece is about how Ukrainian barons are exerting force to protect their own interests, not to advance some GRU plan.

    Insofar as federalization and local control is concerned, surely what you say is true in a polity with a rule of law and functioning representative, executive, and judicial institutions. None of which characterizes Ukraine. History is full of dreary examples of how brutish, nasty, and poor things get in countries or regions divided between local barons with a monopoly of violence in their space and little compunction about using it, and certainly not subject to any accountability from the populace they rule over. A lack of central authority and no check on local authorities usually devolves into warlordism or some kind of mafia rule. Sicily long had a lot of local autonomy.

    Put differently, absent robust institutions, federalization in a place like Ukraine is likely to result in the division of the country into domains ruled over by a gaggle of stationary bandits, not some Jeffersonian republic or New England town meeting government.

    The ProfessorComment by The Professor — May 17, 2014 @ 11:32 am

  6. @So. Further: I focused on Akhmetov merely because he was the subject of numerous articles yesterday, and because he is the richest of the oligarchs in the region at the center of the current conflict. I wasn’t judging a beauty contest between him and Kolomoisky, or anyone else. My default judgment, based on a Darwinian argument, historical precedent, and some news is that they are are all thugs.

    You bring up Russia, and Sverdlovsk in particular. What a depressing choice. Regions ruled by local mobsters, with little control from the center, or a top down system where mobsters in the capital rule (or attempt to rule everyone), often exercising power through the local mobsters. Both systems are f*cked up precisely because there are no institutional checks on the power of the mobsters, and no civil society.

    Raising Sverdlovsk is quite interesting. It is very similar to Donetsk. A gritty shell of a Sovok industrial city, ruled by mobsters. Literally. Yekaterinburg was (and is) the home of Russia’s most notorious mob: Uralmash. (I have been told by someone with extensive experience in Yekat that there have long been close ties between the Yekaterinburg and Donetsk mafias.) They were the real power in the city and region. And don’t me laugh about “answer[ing] for empty coffers, shoddy roads, etc.” Answer to whom? You’ve said some hilarious things over the years, but I think that takes the cake.

    The ProfessorComment by The Professor — May 17, 2014 @ 11:45 am

  7. @So? “Federalisation is Ukraine’s only hope.” “I don’t advocate federalization for Ukraine.” The only way I see to reconcile those statements is that you want to deny Ukraine its only hope. Also interesting alternation between British and American spellings.

    The ProfessorComment by The Professor — May 17, 2014 @ 11:47 am

  8. @elmer. I figured that the immunity angle was why Akhmetov was in the Rada.

    Re that “Putin hanging himself” article is yet another example of the court press raving about Emperor Obama’s magnificent raiment, when in fact he is stark naked. The premise is that Putin wanted to invade and conquer Ukraine, and since he hasn’t, Obama must have deterred him. As I’ve written several times, I don’t believe that Putin had any intention of invading, let alone ruling over any part of Ukraine other than Crimea. Militarily it would be a disaster. Yes, he would likely succeed at first, but the occupation would become a bleeding ulcer. He is content to have frozen conflicts, and a balkanized and dysfunctional Ukraine. His primary objective is preventing Ukraine from moving closer to the EU and Nato, and having a weak Ukraine that he can manipulate from afar, primarily working through the oligarchs. He would be quite content having a purely transactional relationship with someone like Tymoshenko in charge.

    With a few more Obama “victories” like Ukraine and Syria, we are well and truly ruined.

    The ProfessorComment by The Professor — May 17, 2014 @ 11:54 am

  9. I began putting together ideas about devolution of power in Ukraine back in December. Not federalization, but simply devolution of power to the lowest possible lever, since the central government has not been especially successful at preventing corruption and running the place. The central government would cover fiscal policy, defense and security, and standard-setting/quality control over all other areas, including performance indicators. I also recommended eliminating the post of president, as it has been a very costly one in more than merely financial ways. A two-chamber legislature with an independent auditing agency that would also set salaries and benefits for elected officials based on the state of the economy, inflation and average wages and benefits. Ukraine also needs to stop bleeding costly luxury apartment buildings, fancy cars and pensions that are 15 times the basic pension for people that in some cases may have only served a year. Apartments need to be permanently state owned, same for cars, while pensions should only kick in at the standard pensionable age and be simply one factor more for every full term served.

    As to Putin, I don’t agree that he only wants to keep Ukraine destabilized. THere’s a major shale-gas field running from Sloviansk to Kharkiv, in addition to the offshore reserves in Crimea, that are likely part of his motivation as well, as controlling these resources would prevent Ukraine from becoming both independent of Russia energy-wise and an alternative source for the Europeans.

    Comment by Rascalndear — May 17, 2014 @ 5:27 pm

  10. Professor,

    @So? You need to get your eyes checked, or change your prescription, or seek professional help for delusions, because you are seeing things that are not there. I never even mentioned the GRU. Moreover, the entire thrust of the piece is about how Ukrainian barons are exerting force to protect their own interests, not to advance some GRU plan.

    Yet merely a week ago you said:

    And speaking of psychopaths, the separatists in the Donbas are proceeding with their referendum, allegedly without Russian support. But thinking through the decision tree, this is really a no lose situation for Putin. He (via the GRU) started this effort.

    Comment by So? — May 17, 2014 @ 8:50 pm

  11. Professor,

    You bring up Russia, and Sverdlovsk in particular. What a depressing choice. Regions ruled by local mobsters, with little control from the center, or a top down system where mobsters in the capital rule (or attempt to rule everyone), often exercising power through the local mobsters. Both systems are f*cked up precisely because there are no institutional checks on the power of the mobsters, and no civil society.

    Beggars can’t be choosers. And in due time Rossel, Shaimiev were reigned in.

    Comment by So? — May 17, 2014 @ 8:59 pm

  12. Professor,

    @So? “Federalisation is Ukraine’s only hope.” “I don’t advocate federalization for Ukraine.” The only way I see to reconcile those statements is that you want to deny Ukraine its only hope. Also interesting alternation between British and American spellings.

    The junta has made every mistake in the book so far, and as Napoleon would say, why stop them now? Their foolishness is breathtaking. They could have taken Putin’s money, waited another year and kicked out Yanukovych via a legitimate election ala 2004 – hold the same election as many times as you need until the West gets the result it wants. But why do that, when you can burn down the center of your capital, turn it into a pigsty (literally), bankrupt the economy, lose part of your country and start a civil war? Brilliant.

    Professor, speaking of hope, why are you so emotionally invested in keeping this Sovok Chimera alive?

    Comment by So? — May 17, 2014 @ 9:12 pm

  13. Wow. A guy who thinks all it takes to depose a dictator with blood on his hands is to “wait another year for elections” accuses someone else of foolishness. All that with a living, stinking Muscovy nearby as an obvious example of just how swell such a strategy works. Quite an accomplishment even for So?

    Comment by Ivan — May 18, 2014 @ 12:09 am

  14. Ivan,

    Why not? Yanukovych exercised superhuman restraint during Maidan after all. Throw a Molotov cocktail at an American riot cop and your life expectancy will be measured in microseconds.

    Comment by So? — May 18, 2014 @ 3:06 am

  15. > Why not?

    So?, I am not qualified nor licensed to help improve cognitive abilities of retarded sovoks like yourself, so you will have to seek help elsewhere. My layman guess is that not taking kremlinoid propaganda at face value might be a good first step.

    Comment by Ivan — May 18, 2014 @ 4:16 am

  16. Since you’ve resorted to insults, you have nothing to say. But at least you’re better than Andrew, elmer and LaR (and your beloved Kiev junta for that matter). They open with insults. BTW, the last vestige of sovok is that chimera called Ukraine. Crimea is the first step to rectifying that historical aberration.

    Comment by So? — May 18, 2014 @ 4:50 am

  17. > the last vestige of sovok is that chimera

    that is your sovok worldview. Even thought it has sacrificed millions of other people’s lives to its chimerical misanthropic cause, it is still inexorably dying out. This is why no amount of brutality would be judged “unrestrained” by your ilk: it’s basically your “sovok dream”‘s fight for survival, and you know you are losing.

    Comment by Ivan — May 18, 2014 @ 7:00 am

  18. @So?

    “Yanukovych exercised superhuman restraint during Maidan after all.”

    Bullshit and bullfuck.

    The goddamn illiterate moron thug yanukonvikt was involved in ordering snipers against protesters. The special snipers had special bands on their sleeves, so they would not shoot each other.

    You are a goddamn liar, So?.

    And Ivan is absolutely right – to wait for another year for elections, especially when elections had already been postponed by yanukonvikt and his thugs, including his thugs in the so-called Ukrainian court, would have been suicide for the people.

    It would have given yanukonvikt to complete the final steps of his attempted dictatorship.

    People in Ukraine had already had enough of yanukonvikt’s lies, and those of his cronies, and it was only getting ready to get worse.

    Comment by elmer — May 18, 2014 @ 11:46 am

  19. @So? I have said for years that Ukraine is a Sovok nightmare. @elmer has said the same. That said, Maidan has at least a hope of nudging the country in the right direction.

    I disagree that the government is a junta, and note with interest that you parrot the preferred Russian agitprop term to refer to it.

    As other commenters note, your proposed strategy is beyond foolish. A rapid election is preferable, and Yanukovych (almost certainly acting at Putin’s orders) pushed things to a breaking point in January-February. You present the most false of choices.

    I am not at all invested in keeping a Sovok chimera alive. I want it killed, but realize that will not happen in a day. Perpetuating Yanukovych would have been the way to keep the chimera alive.

    What’s more, although I have very low expectations for whether Ukraine will be able to become non-Sovok in my lifetime (and I’m not that old) there are other issues at stake here, most notably Putin’s challenge to the post-WWII and post-Cold War settlements (and hell, arguably even the Westphalian framework, which hypocritically Putin and Russia invoke when it benefits them); his revanchism; the threat he will pose throughout eastern Europe if he is not thwarted; and the encouragement that European and American fecklessness will provide to others who want to challenge the post-WWII order not just in Europe but in Asia (notably China).

    Ukraine is a deeply flawed state, and the flaws are so deep that it is difficult to imagine a path towards it becoming a “normal” country in the way Poland has, or the Baltics. That said, it should be given a chance, which requires protecting it from a thug who likes it just the way that it is, and who will use any means available to achieve his objective. This is all the more true given that if Putin is not deterred now, bigger and perhaps more dangerous conflicts are inevitable in the future.

    Can Ukraine defeat its internal demons? I doubt it, sad to say. But it is vitally important to thwart its external demon, because he bedevils not only Ukraine, but Europe and even the Middle East, as 150,000 dead Syrians demonstrate.

    The ProfessorComment by The Professor — May 18, 2014 @ 12:26 pm

  20. SWP, I think the US has not gone after Akhmetov, because Akhmetov does not operate in the same way as Firtash.

    Akhmetov is a Tatar.

    Firtash is Jewish. He is tied in with Simeon Mogilevych, a 300-pound human bowling ball, who is Jewish and hiding out in Maskva.

    Firtash operated through Robert Shetler-Jones, who is located in England.

    What is the US going to get Akhmetov for?

    Yes, he bought the most expensive apartment in Londongrad. Yes, he is a criminal corrupt thug oligarch.

    The US indicted and convicted Lazarenko in the US, because Lazarenko tried to launder tens of millions of dollars in California.

    Firtash’s indictment rested on the following:

    Beginning in 2006, the defendants allegedly conspired to pay at least $18.5 million in bribes to secure licenses to mine minerals in the eastern coastal Indian state of Andhra Pradesh. The mining project was expected to generate more than $500 million annually from the sale of titanium products, including sales to unnamed “Company A,” headquartered in Chicago

    Akhmetov participated in thoroughly corrupt and criminal privatization schemes in Ukraine – but how would the US indict him for that?

    SCM, his company, has engaged lobbyists in the US and elsewhere, and has engaged in a massive public relations campaign, as you no doubt know.

    But Firtash operated via trading stuff, including trading gas via RosUkrEnergo in its corrupt scheme.

    Akhmetov has steel mills, media and other enterprises which operate in a different way from Firtash.

    As far as I can tell, there might not be any grounds for the US to indict him.

    I’m obviously not defending the guy.

    Comment by elmer — May 18, 2014 @ 12:27 pm

  21. @So? I have been pointing out the hellish choices in Russia for years. The direct result of the lack of civil society and the rule of law, neither of which were ever strong in Russia, and to the extent they ever existed, were destroyed by the Soviets. The whole reason I started writing about Russia extensively is that it was a real life classical liberal dystopian story, brought to life.

    My whole point was that in such a degraded polity, your suggestion of devolving authority to local governments was hardly going to lead to the accountable government that you suggested.

    In other words, in Russia you just get a choice of mobsters.

    The ProfessorComment by The Professor — May 18, 2014 @ 12:30 pm

  22. I also never said the GRU was not involved at all. I know it is involved. I know, as I said merely a week ago, it is fomenting what is going on in Donbas. But that is completely off point to what I was talking about when you accused me of viewing *everything* in Donbas as a GRU operation. I was writing about Akhmetov, whom I do not believe is part of any such operation.

    You really have to try harder.

    The ProfessorComment by The Professor — May 18, 2014 @ 12:32 pm

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