May 18, 2014:
Five weeks of Russian inspired separatist violence in eastern Ukraine has left over 130 dead so far and the fighting continues. Russian plans to annex eastern Ukraine (the Donbas region) are not working as they did in Crimea. In Donbas the locals as well as the Ukrainian government are fighting back. The Russian supported separatists are outnumbered and in danger of being crushed. Russia cannot really afford a defeat like this, but is faced with growing anger in Ukraine and around the world. Russia makes light of Western sanctions over the Ukraine meddling, but the economic damage to Russia is already being done and there is nothing Russia can do to halt that short of getting out of Ukraine. Thus for the last few days the Ukrainian government has been holding talks with the pro-Russian separatists but these do not appear to be going anywhere, apparently because Russia has not decided what to do next.
The crisis in Ukraine, which began earlier in the year when the corrupt leader of Ukraine was ousted by a popular uprising (for taking bribes from the Russians), led Russia to more desperate measures. Russia apparently thought this was necessary because for the last decade years Russia has been turning back into a dictatorship, complete with state control of the media and lots of propaganda about foreign enemies. This includes depicting Western Europe and the U.S. as conspiring to surround Russia and weaken it. Or something like that, it’s unclear in the West what the Russian objective here is other that stirring up traditional Russian fears of foreign invasion to distract Russians from the fact that they are gradually losing their democracy, and at great economic cost. The government is now calling everyone who disagrees with them a fascist and enemies of Russia. The fascist angle is useful against Ukraine as during World War II many Ukrainians cooperated with the Nazis in the hope of regaining independence. Russia never forgave the Ukrainians for openly proclaiming their preference for the German fascists over the Stalin led communists of the Soviet Union. To the Ukrainians the Nazis were the lesser of two evils and the Russians did not appreciate the comparison. Meanwhile, to many Russians and most Ukrainians the “new Russia” is the true fascist state, but you can get in trouble for saying that inside Russia.
In eastern Ukraine the Russian plan to seize control of the Donetsk and Luhansk Oblasts (province) is falling apart. Luhansk has half the population of Donetsk but together these two provinces contain about 13 percent of Ukraine’s population and the two provinces are about 38 percent ethnic Russian. The two provinces comprise the Donets Basin (or “Donbas”) which was for a long time an economic powerhouse for Russia. But that began to decline in the 1980s and accelerated when the Soviet Union fell (and Ukraine became independent) in 1991. The Donbas still comprises about 15 percent of Ukraine’s GDP and, outside of Kiev, is the most densely populated area of Ukraine. Luhansk has the longest border of with Russia of any Ukrainian province. In the Donbas many of the ethnic Russians believe that if Russia controlled the Donbas once more things would be better. That may be because Russia has natural gas and oil which Ukraine lacks. Most of these Russians originally moved to the Donbas because of the jobs and since the 1990s many younger ones have returned to Russia.
With Russian encouragement and assistance in early April some of these ethnic Russians formed separatist militias and have seized control of some parts of the Donbas and now call it the Donetsk and Luhansk people’s republics. Most of the Donbas population does not want to become part of Russia again. This includes Rinat Akhmetov, a billionaire whose fortune is largely based on Donbas industries. Akhmetov employs 300,000 people in Donbas, which is nearly ten percent of the workforce. Coming out in opposition to the Russian aggression is dangerous because if the Russians do seize Donbas Akhmetov will lost most of his fortune. At the same time Akhmetov is demanding changes in the Ukrainian government for his support. This includes more autonomy for Donbas (and Akhmetov) and less corruption (and more efficient government). Akhmetov appears to have sensed which way the political winds are blowing and may have concluded that his fortune was in trouble even if he backed the Russian aggression. For many people in the region Russia is considered even more corrupt than Ukraine and the Akhmetov fortune is, to many in Russia, something to be seized and distributed to Russians. Akhmetov is Jewish and while there is still a lot of anti-Semitism in Ukraine it is far worse in Russia.
The separatists control about a third of the Donbas population mainly via their occupation of government buildings and many key road junctions in the major cities. While the armed pro-Russian separatists have been fighting back when they encounter Ukrainian troops they are less eager to open fire on local pro-Ukrainian militias. This is troubling news for Russia which now has to fear a guerilla war if it seizes Donbas. The old Soviet Union was brutal and will organized enough to deal with Ukrainian guerillas after World War II, although that fighting lasted into the 1950s. Post-Soviet Russia is much less able to deal with a popular rebellion against Russian rule. Russia also has growing economic problems resulting from the aggression in Ukraine. Huge amounts of Russian and foreign cash (several hundred billion dollars’ worth) has fled the country and most foreign investment plans are dead or on hold. According to the IMF (International Monetary Fund) believes the Russian economy is now in recession. This is not so much because of the sanctions, but because investors (Russian and foreign) see the Ukrainian adventure ending badly for Russia and until it is clear that the outcome is otherwise, are getting their money to a safer place.
May 17, 2014: Russia has reorganized its bureaucracy in the Caucasus with an eye towards more economic development and more infrastructure (roads, schools and so on). At the same time the money allocated for all that has been cut by more than ten percent. The security forces have put a lid on the Islamic terrorism and separatist violence in the area, but not done much about the corruption and bad government that helps keep the violence going.
On the Ukrainian border pro-Russian separatist leader Valery Bolotov (and head of the newly proclaimed independent Luhansk) was arrested by border police. Before Bolotov could be moved to western Ukraine about 200 of his armed supporters attacked the border post and Bolotov was freed. Bolotov was returning from Russia where he had received medical treatment for wounds he had received in fighting on the 13th.
May 16, 2014: In eastern Ukraine (southern Donetsk, the port city of Mariupol) the richest man in Ukraine (Rinat Akhmetov) organized a militia from among workers at several steel plants he owns in the region and ordered that pro-Russian militias be thrown out of government buildings they have been occupying.
Russian combat units continue to arrive at the Ukraine border, where the set up camp and wait. Some of the troops believe they are there for “peacekeeping” operations in Ukraine. There are over 40,000 Russian troops on the Ukrainian border. These troops are better trained and equipped than they were in 2008 when Russia invaded tiny (a tenth the size of Ukraine) Georgia. Since then Russia has increased its defense spending, on average, at least ten percent a year. Ukrainian troops are less well trained and equipped, but they are angry at this Russian aggression and that may make a difference if it comes to a fight.
May 15, 2014: Ethnic Russian separatists in Donetsk (eastern Ukraine) appointed a Russian fixer (Aleksandr Borodai, a well-known “political consultant”) who was active in the recent Russian effort to annex Crimea, to be the head of the newly declared independent Donetsk. Borodai is a Russian citizen and in Ukraine he worked for a lot of wealthy people who needed some problem in Russia taken care of (for a price).
May 13, 2014: Russia retaliated against American sanctions by cancelling contracts for American use of Russian rockets (for launching satellites and supporting the International Space Station). Russia also cancelled the sale of Russian rocket engines for some of America’s space rockets. The U.S. can get around this and these moves will hurt Russia more than anyone else. There are plenty of other satellite launch providers out there, including new American firms. This Russian move also discourages foreign investors and makes Russian investors more eager to invest their money outside Russia.
In eastern Ukraine (Donetsk) about 30 pro-Russian militiamen ambushed a Ukrainian army convoy approaching the city of Kramatorsk, killing seven Ukrainian soldiers and wounding eight. This was the biggest Ukrainian army loss of life in a single incident so far.
The U.S. released satellite photos showing Russian forces deployed on the Ukrainian border, mostly around the Donbas.
Russia announced that China has agreed to a deal to build a natural gas pipeline from Russia to China so Russia can export natural gas. This deal had been in the works for a long time and it was believed that the growing production of shale (“fracked”) natural gas worldwide was making this deal unattractive for China. Russia had long dismissed shale gas and fracking as more American fads that would soon fade. Now Russia has to cope with lost markets because of shale gas (driving gas prices down) and their own misbehavior. Since oil and gas are Russia’s major exports, this is a serious matter. With less foreign currency available from energy sales, there is less money to import new technology and consumer goods as well as rebuild the military. Older Russians remember how successful American efforts to lower the price of oil in the 1980s helped bankrupt and destroy the Soviet Union. It is happening again. Even ally China suddenly became less likely to be a customer for Russian natural gas because the proposed deal to build a $22 billion natural gas pipeline to China depended on the price of natural gas staying high enough to justify the pipeline cost. With more countries (including Europe and China) fracking a lot, the price of natural gas will stay low and the China pipeline could a big money loser. Russia has apparently sweetened the deal sufficiently (at Russian expense) to interest the Chinese again.
May 12, 2014: Russia asked pro-Russian separatists to postpone their May 18th vote to ask to join Russia.
May 11, 2014: Pro-Russian separatists held a vote in the Donbas to decide if Donbas should declare itself independent. All this was a sham and the outcome (over 90 percent voting to secede) was expected. Earlier opinion surveys showed that 73 percent of the Donbas population wanted to remain part of Ukraine as did 93 percent of those in the rest of the Ukraine. The pro-Russian groups wanted to hold another vote on the 18th to decide if the newly independent Donbas will join Russia. At that point Russian troops would have an excuse to move in and defend this new part of Russia. Unlike Crimea the majority of people in Donbas, including most ethnic Russians, don’t want to be part of Russia and they are getting organized to resist. Russia is now hesitating.
May 9, 2014: In eastern Ukraine (Donetsk) nine people died (and 39 were wounded) during fighting in the port city of Mariupol. Apparently Russian separatists clashed with police and got the worst of it.
May 5, 2014: Ukrainian troops fought their way into Sloviansk (in Donetsk) suffering over fifty casualties after several days fighting with separatists.
May 4, 2014: In south Ukraine (Odessa) pro-Russian militiamen attacked a police station and freed 70 separatists. The Ukrainian police force is notoriously corrupt and open to bribes but in this case they refused to give up the prisoners.
May 3, 2014: In Odessa heavy fighting took place between pro-Russian and pro-Ukraine mobs. There were over a hundred casualties before police broke it up.
May 1, 2014: Ukraine revived conscription and apparently plans to draft some young men for the security forces. Russia warned Ukraine to keep Ukrainian troops out of the Donbas. Ukraine ignored that warning and Russia backed down.
April 29, 2014: In eastern Ukraine (Luhansk province) several hundred pro-Russian militia occupied several government buildings in the provincial capital (also called Luhansk) and declared themselves in control of the city and the province.