Europe on Brink of Trade War with Russia

I think we're headed for another significant shift in Ukraine. The present ceasefire was agreed to by the junta because of the success of the Novorrosiya Armed Forces (NAF) in creating a southern front and threatening the large industrial seaside city of Mariupol, where Ukrainian president Petro Poroshenko was yesterday proclaiming solidarity with residents and vowing that the city would never be yielded to the NAF.

The preliminary report on the crash of flight MH17 was released this morning, and it cautiously reaffirms conventional wisdom, namely, that shrapnel coming from NAF-controlled territory or western Russia was responsible for the midair breakup of the Malaysia Airlines Boeing 777. While the report doesn't say a BUK missile was the source of that shrapnel, a.k.a., high-energy objects, it doesn't have to. Western reporters and government spokespersons will color in the missing parts based on what they already accept as fact. The Russians did it.

As the ceasefire disintegrates -- I don't see how it can hold for too much longer -- and the Dutch MH17 report gets spun according to the current Russophobia, Europe is going to be in for some pain. The EU has voted on a new round of Russian sanctions that target financing for Rosneft and Transneft and Russia has threatened to prohibit European commercial airlines from using its airspace. Andrew Higgins has an informative story this morning, "Brushing Off Threats, E.U. Votes to Toughen Its Sanctions on Russia," which offers the reader a glimpse of the mess Europe has got itself in by supporting the U.S.-backed coup-makers in Kiev:

The European Union has given strong support to the cease-fire but, skeptical about Russia’s intentions after the swift collapse of previous efforts at a settlement, decided on Monday to expand existing economic sanctions. Diplomats say the measures include tight restrictions on access to capital in Europe by the two state-controlled Russian energy giants, Rosneft and Gazprom’s oil affiliate, and the state pipeline operator, Transneft. 

“The sanctions aim at promoting a change of course in Russia’s actions destabilizing eastern Ukraine,” Herman Van Rompuy, the president of the European Council, which represents member states, said in a statement. He said the measures would go into effect “in the next few days.” 

There was no immediate reaction from Moscow, which responded to an earlier round of European sanctions by banning a broad range of dairy, meat, fruit and vegetable exports from Europe. 

Russia has worked hard to fan divisions within the European Union, and Prime Minister Dmitri A. Medvedev warned in an interview published early on Monday in Moscow that his government would “have to respond asymmetrically” to any new sanctions, perhaps by banning Western airlines from flying through Russian airspace, as many do on long-haul flights to Asia. 

“If Western carriers have to bypass our airspace, this could drive many struggling airlines into bankruptcy,” Mr. Medvedev said in a lengthy interview in the Russian newspaper Vedomosti. “This is not the way to go. We just hope our partners realize this at some point.”

Measures endorsed by leaders of the European Union’s 28 member states normally go into effect within hours. But Finland, hard hit by the Russian ban on food imports, and some other countries anxious to see whether the cease-fire holds in coming days, appealed for a slower schedule.

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Some smaller European countries, notably Slovakia, had argued strongly against new sanctions, warning that they would only hurt Europe’s anemic economic recovery and were “meaningless.” But bigger countries, particularly Germany, which was itself initially hostile to sanctions, have increasingly lost faith in Russia’s trustworthiness and been exasperated by Moscow’s insistence, despite strong evidence to the contrary, that it has not sent soldiers or weapons into eastern Ukraine.

It was the downing of MH17 which buffaloed Merkel into accepting the U.S. position on sanctioning Russia. Up until that point I was under the impression that Merkel would not be bumrushed into a trade war with Russia. But that is where we are now.

I don't think that there is a way to avoid a trade war, absent a coup in Moscow by a U.S.-friendly oligarch. Medvedev is on record saying Western commercial air carriers are in the crosshairs. Russians believe more in honor and personal integrity and standing by what you say than Western politicians. When Russia responds, if the European Union doesn't publicly fray, then at least there will be those member nations who tacitly flout the trade restrictions, setting up secret bilateral agreements with Moscow.

And then the United States, losing the main weapon in its arsenal -- having the Europeans restrict economic relations with Russia -- will be left with increasing military support for an incompetent, mendacious junta as its remaining option (one that is sure to fail).

Before signing off this morning, there are a few good stories to inspect today. First, Rod Nordland reports on the acrimony at the annual ceremony honoring Ahmed Shah Massoud, leader of the Northern Alliance whose assassination by Al Qaeda two days prior to 9/11 prefigured the attack on the U.S. homeland.  Abdullah Abdullah has said that he will not acknowledge the results of the Afghan presidential recount, which apparently will declare Ashraf Ghani the victor.

Next, check out Tim Arango's Q.&A.-session. Arango is the Baghdad bureau chief for the Gray Lady, and over the years I have found him to be the best reporter, along with David Kirkpatrick, that "the newspaper of record" has to offer. Here is an example:

Q. How do you rate the Obama administration’s actions in Iraq?— eragon38 

It’s not my job to rate the Obama administration’s actions in Iraq. But I will tell you that after 2011, the administration basically ignored the country. And when officials spoke about what was happening there, they were often ignorant of the reality. They did not want to see what was really happening because it conflicted with their narrative that they left Iraq in reasonably good shape. In 2012, as violence was escalating, I wrote a story, citing U.N. statistics, that showed how civilian deaths from attacks were rising. Tony Blinken, who was then Vice President Joseph R. Biden’s national security guy, pushed back, even wrote a letter to the editor saying that violence was near historic lows. That was not true. Even after Falluja fell to ISIS at the end of last year, the administration would push back on stories about Mr. Maliki’s sectarian tendencies, saying they didn’t see it that way. So there was a concerted effort by the administration to not acknowledge the obvious until it became so apparent — with the fall of Mosul — that Iraq was collapsing.