Hard Times Ahead for Ukraine's Putsch

Things are only going to get worse in Ukraine. As long as the story stays focused on the predations of the disgraced President Viktor Yanukovych, who is currently on the run from the putschists, the depressing reality of the country post-putsch can remain somewhat obscured to both the casual news consumer in the West and the Ukrainian citizen enjoying a revolutionary high.

But as Hegel once remarked, "What is real is rational, and what is rational is real," or something along those lines. While the Gray Lady dutifully does her part as a member of the United States foreign affairs team, posting video of Ukrainians gape-mouthed wandering the grounds of Yanukovych's presidential palace, as well as soaring images of the victorious protesters massed on the Maidan, the truth finds its way to the surface in the reports filed by her staff.

Take for instance today's effective hit piece by Andrew Higgins, "An Unfinished Ukraine Palace and a Fugitive Leader’s Folly"; effective because it keeps the narrative squarely focused where the U.S./EU wants it, not on the machinations of the putsch government but on the illegal greed and corruption of President Yanukovych (who, by Western druthers, is to be considered a present-day Nicolae Ceaușescu).

Higgins describes workers walking off the construction site of a mansion Yanukovych was building for himself in an old-growth forest along the Crimean coast. Who can defend a plutocrat who illegally erects yet another mansion for himself, this time in an old-growth forest that had been used by regular folks as a place to hike? Certainly not your average reader of the New York Times.

But like many a reporter under the Gray Lady's yoke (for example, Beirut bureau chief, Anne Barnard), Higgins finds a way to subvert the narrative (venal, Ceaușescu-like despot as the personification of evil) at the story's end:

“Why does he need a palace every few kilometers? He thought he was a czar,” said Mr. Pilti, who was in Kiev on business during Saturday’s takeover by protesters and was staggered to see the size of Mr. Yanukovych’s captured spread outside the capital. 

Sergei, the contractor, said he did not like the new government in Kiev at all but was “still happy about what has happened — it had to happen sooner or later.” Ukraine, he added, desperately needs a more open system so the people can clearly know what is going on when a valued public forest suddenly gets fenced off and cut down to make way for a private mansion. 

His chief quarrel with Mr. Yanukovych’s opponents, he added, is not that they ousted a good leader, but that they, too, are deeply corrupt and will soon be building villas of their own if they manage to hang on to power. 

“Everyone knew what was happening here,” he said, gesturing at the concrete extravaganza he helped to build, “but they didn’t say anything because they were doing the same thing, only smaller.”

"Why does he need a palace every few kilometers?" is of course a question those of us who reside in "The greatest nation on Earth"™ ask ourselves. You see, we have oligarchs of our own.

And this is what will be the undoing of the putsch: getting rid of Yanukovych is not going to rid the country of its predatory oligarchs; aligning itself with the U.S./EU will not reopen shuttered hospitals and put the unemployed back to work and lessen corruption.

First off, member states of the European Union are loath to float a financial rescue because of prevalence of corruption in Ukraine regardless of party. This is from a story today by Steven Erlanger and David Herzsenhorn, "Tentatively, European Union Weighs Its Options on Support for a New Ukraine":

The European Investment Bank can also help with quick money but, Mr. Rehn [European Commissioner for Economic and Monetary Affairs and the Euro] noted, “E.U. resources lie predominantly with member states” — hence the idea of a donors’ conference. But there is little obvious enthusiasm among member states, many of them still in recession or just emerging from it, to pump large amounts of money into an unreformed Ukraine that has been famous for crony capitalism and corruption. 

Poland, for example, which has been a key interlocutor on Ukraine, has said that it wants to see significant structural change in the country first. On Monday, Prime Minister Donald Tusk said that a stable Ukraine was in Poland’s interest. As for foreign aid, he said, “Poland will not sweat its guts out.” 

Ukraine needs to show that it can absorb foreign aid and not waste it, Mr. Tusk said. “It cannot be that we will organize huge funds for Ukraine and Ukraine will continue to waste this money by, for example, corrupt governments or oligarchs,” he said.

Ukraine needs $35 billion to keep from going bankrupt. Since the money is not likely to come from the EU, this means that the bailout has to come from the International Monetary Fund. And we know what that means. Brutal austerity. Hence the delay by the putsch parliament in forming an interim government. No one wants to sign off on IMF austerity because he/she will be ending his/her political career. Rada members are attempting to avoid this outcome by making it appear that they are consulting the EuroMaidan protesters and getting their consent. This is from an illuminating piece by David Herzsenhorn, "Infighting Poses Hurdle to Formation of New Coalition in Ukraine":

“This government will be legitimate not when it is voted in the Parliament but when it receives support of the people who stood on Maidan,” said Arseniy P. Yatsenyuk, a lawmaker in the party Fatherland who is a leading contender to serve as acting prime minister. 

Mr. Yatsenyuk also pleaded with colleagues to end their infighting and swiftly reach an agreement on the designation of an interim government, which is needed to formally request emergency economic assistance from the International Monetary Fund. 

“The deadline is Thursday,” he told reporters outside the Parliament chamber. “This government will face tremendous challenge. And we have to say absolutely openly that those who go into this government are rescuing the country on one hand, but on the other hand they should be aware that they are committing political suicide.”

Originally, the agreement brokered with Yanukovych last Friday by France, Germany and Poland would have avoided all this. Yanukovych would have appointed a new, "technical government" to oversee the U.S./EU/IMF austerity mandates. After this, Yanukovych's political career would have been terminated. Not to worry though, he would have had that mansion in the old-growth forest on the Crimean coast in which to comfortably enjoy his retirement. But this was upended by the putsch, a foolish move. Now the putschists are on the hook for the onrushing austerity.

Russia still holds all the cards. Russia is Ukraine's largest trading partner and supplies the country with its fuel. Russia's bear claws are resting on Ukraine's jugular. Additionally, Europe has to remain respectful of Russian interests since Germany receives a significant amount of natural gas from Gazprom.