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Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over “Unfriendly NATO Threats” | Zero Hedge

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over “Unfriendly NATO Threats” | Zero Hedge.

Perhaps it is time to finally admit that anyone who thought Putin’s Tuesday press conference, which the market so jubilantly assumed was a case of “blinking” and de-escalating tensions with the west, was wrong. If there is still any confusion, following yesterday’s news that Gazprom officially threatened Ukraine with cutting off its gas supplies, as well as the storming of a Ukraine base by Russian troops – luckily with no shots fired so far – then today’s developments should any remaining doubts. Moments ago AP reported that as the latest, third in a row, group of OSCE inspectors tried to enter Ukraine, they were not only barred from doing so, but warnings shots were fired to emphasize the point by pro-Russian forces.

From AP:

An Associated Press reporter says pro-Russian forces refused to let a foreign military mission enter Crimea on Saturday.

After the officers had stopped, the armed men fired warning bursts of automatic weapons fire into the air to make other unidentified vehicles halt. No injuries were reported.

The multinational group of military officers from the Organization for Security and Cooperation in Europe was attempting to enter the embattled peninsula from the north. The armed men told them they had no authorization to enter Crimea.

The OSCE mission will likely return to the Ukrainian city of Kherson where it had spent the night, the AP reporter said.

Russia and Ukraine are locked in a tense standoff over Crimea.

Bloomberg adds:

OSCE tried to enter Crimea for third day, warning shots were fired as it attempted to do so today, Tatyana Baeva, OSCE spokeswoman, said by phone from Vienna.

Nobody injured in incident, OSCE mission is now back in Kherson, southern Ukraine.

OSCE 29 member states that provided people for Crimea mission may meet today or tomorrow in Vienna to discuss further action: Baeva

Then there was this overnight escalation as reported by Ukraine’s TV5 station (of questionably credibility), via Bloomberg:

Pro-Russian armed men today captured building in Simferopol, capital city of Crimea, TV5 private news channel reports, citing Vladislav Selezniov, spokesman for Ukraine’s defense minister in Crimea.

Russian soldiers seized Ukraine’s state border guard division in Shcholkino near Kerch Strait, Ukraine’s border service says in statement on its website

Russian soldiers stormed Shcholkino unit last night, seized weapons storage, beat Ukrainian border guards, took away their mobile phones and forced them and their families to leave

Currently, 11 border guard units are being blocked: Ukraine border service says in separate statement

Ukraine denied entrance to 513 “extremists” from Russia during last 24 hrs, state border guard service says in another separate statement on its website

Remember, all it takes is for one stray bullet to hit a human target, on either side of the conflict, for the market to grasp just how wrong its assessment of de-escalation has been.

Elsewhere, while inspectors were trying to make their way into Ukraine – unsuccessfully – Russia announced it was considering a further freeze of U.S. military inspections under arms control treaties in retaliation to Washington’s decision to halt military cooperation with Russia, news reports said Saturday.

Interfax blasted earlier:

  • UNJUSTIFIED U.S., NATO THREATS SEEN AS UNFRIENDLY GESTURE, ALLOW TO DECLARE FORCE-MAJEURE – RUSSIAN DEFENSE SOURCE
  • RUSSIAN DEFENSE MINISTRY CONSIDERING SUSPENSION OF RECEIVING INSPECTION GROUPS UNDER START TREATY, VIENNA DOCUMENT 2011 – SOURCE

AP has more:

Russian news agencies carried a statement by an unidentified Defense Ministry official saying that Moscow sees the U.S. move as a reason to suspend U.S. inspections in Russia in line with the 2010 New START treaty on cutting U.S. and Russian nuclear arsenals and the 2011 Vienna agreement that envisages mutual inspections of Russian and NATO military facilities as part of confidence-building measures.

A Defense Ministry spokesman wouldn’t comment on the reports, which are a usual way in Russia to carry unofficial government signals.

The U.S. and the European Union have introduced sanctions over Russia in response to its move to send troops that have taken control of Ukraine’s Black Sea peninsula of Crimea.

So if the START treaty is suspended how long until its anti-proliferation clauses are scrapped completely once more, and the Cold War arms race returns once again.

Also, \while escalations such as these threaten to transform the new Cold War into a hot one, the clock is ticking, and in favor of Russia, because the longer Ukraine remains without western aid, the quicker its foreign reserves will run out, and the faster the country will become a vassal state of Gazpromia. Add the ticking countdown to the March 16 Crimean referendum, which the west and Ukraine have both declared illegitimate yet have no power to stop, and suddenly one can see how Putin once again outsmarted everything the west had to throw at it. WSJ explains:

Gazprom’s demand raises the prospect that some of the aid Western powers have guaranteed could end up flowing into Moscow’s coffers to pay Ukraine’s gas bill. Virtually all of the country’s natural-gas imports come from Russia. Late last year it was granted a discount that Moscow has threatened to rescind since the fall of Mr. Yanukovych.

“This now becomes an EU/U.S. problem: Who is going to lend Ukraine the money to pay the gas bill? If so, what will be the conditions?” said Jonathan Stern, an analyst at the Oxford Energy Institute.

A spokesman for Gazprom said that the threatened cutoff wouldn’t affect supplies to Europe, which gets about a third of its gas from Russia, much of it via pipelines that run through Ukraine.

 

 

In 2009, after the Russian energy giant switched off the supply to Ukraine, Ukrainian authorities began using the supply transiting their territory that Gazprom said was destined for customers in Europe. Gazprom then cut off the flow altogether, causing shortages and price increases for end customers.

 

“The EU, U.S. and IMF have just about three weeks to resolve this,” Mr. Stern said.

At which point it’s game, set match Putin once more.

Finally, what certainly helped Russia is that, as expected, China took the side of Putin, not of the “free world”, in what is now a very distinct and clear axis of power the New Normal dipolar world.

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over "Unfriendly NATO Threats" | Zero Hedge

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over “Unfriendly NATO Threats” | Zero Hedge.

Perhaps it is time to finally admit that anyone who thought Putin’s Tuesday press conference, which the market so jubilantly assumed was a case of “blinking” and de-escalating tensions with the west, was wrong. If there is still any confusion, following yesterday’s news that Gazprom officially threatened Ukraine with cutting off its gas supplies, as well as the storming of a Ukraine base by Russian troops – luckily with no shots fired so far – then today’s developments should any remaining doubts. Moments ago AP reported that as the latest, third in a row, group of OSCE inspectors tried to enter Ukraine, they were not only barred from doing so, but warnings shots were fired to emphasize the point by pro-Russian forces.

From AP:

An Associated Press reporter says pro-Russian forces refused to let a foreign military mission enter Crimea on Saturday.

After the officers had stopped, the armed men fired warning bursts of automatic weapons fire into the air to make other unidentified vehicles halt. No injuries were reported.

The multinational group of military officers from the Organization for Security and Cooperation in Europe was attempting to enter the embattled peninsula from the north. The armed men told them they had no authorization to enter Crimea.

The OSCE mission will likely return to the Ukrainian city of Kherson where it had spent the night, the AP reporter said.

Russia and Ukraine are locked in a tense standoff over Crimea.

Bloomberg adds:

OSCE tried to enter Crimea for third day, warning shots were fired as it attempted to do so today, Tatyana Baeva, OSCE spokeswoman, said by phone from Vienna.

Nobody injured in incident, OSCE mission is now back in Kherson, southern Ukraine.

OSCE 29 member states that provided people for Crimea mission may meet today or tomorrow in Vienna to discuss further action: Baeva

Then there was this overnight escalation as reported by Ukraine’s TV5 station (of questionably credibility), via Bloomberg:

Pro-Russian armed men today captured building in Simferopol, capital city of Crimea, TV5 private news channel reports, citing Vladislav Selezniov, spokesman for Ukraine’s defense minister in Crimea.

Russian soldiers seized Ukraine’s state border guard division in Shcholkino near Kerch Strait, Ukraine’s border service says in statement on its website

Russian soldiers stormed Shcholkino unit last night, seized weapons storage, beat Ukrainian border guards, took away their mobile phones and forced them and their families to leave

Currently, 11 border guard units are being blocked: Ukraine border service says in separate statement

Ukraine denied entrance to 513 “extremists” from Russia during last 24 hrs, state border guard service says in another separate statement on its website

Remember, all it takes is for one stray bullet to hit a human target, on either side of the conflict, for the market to grasp just how wrong its assessment of de-escalation has been.

Elsewhere, while inspectors were trying to make their way into Ukraine – unsuccessfully – Russia announced it was considering a further freeze of U.S. military inspections under arms control treaties in retaliation to Washington’s decision to halt military cooperation with Russia, news reports said Saturday.

Interfax blasted earlier:

  • UNJUSTIFIED U.S., NATO THREATS SEEN AS UNFRIENDLY GESTURE, ALLOW TO DECLARE FORCE-MAJEURE – RUSSIAN DEFENSE SOURCE
  • RUSSIAN DEFENSE MINISTRY CONSIDERING SUSPENSION OF RECEIVING INSPECTION GROUPS UNDER START TREATY, VIENNA DOCUMENT 2011 – SOURCE

AP has more:

Russian news agencies carried a statement by an unidentified Defense Ministry official saying that Moscow sees the U.S. move as a reason to suspend U.S. inspections in Russia in line with the 2010 New START treaty on cutting U.S. and Russian nuclear arsenals and the 2011 Vienna agreement that envisages mutual inspections of Russian and NATO military facilities as part of confidence-building measures.

A Defense Ministry spokesman wouldn’t comment on the reports, which are a usual way in Russia to carry unofficial government signals.

The U.S. and the European Union have introduced sanctions over Russia in response to its move to send troops that have taken control of Ukraine’s Black Sea peninsula of Crimea.

So if the START treaty is suspended how long until its anti-proliferation clauses are scrapped completely once more, and the Cold War arms race returns once again.

Also, while escalations such as these threaten to transform the new Cold War into a hot one, the clock is ticking, and in favor of Russia, because the longer Ukraine remains without western aid, the quicker its foreign reserves will run out, and the faster the country will become a vassal state of Gazpromia. Add the ticking countdown to the March 16 Crimean referendum, which the west and Ukraine have both declared illegitimate yet have no power to stop, and suddenly one can see how Putin once again outsmarted everything the west had to throw at it. WSJ explains:

Gazprom’s demand raises the prospect that some of the aid Western powers have guaranteed could end up flowing into Moscow’s coffers to pay Ukraine’s gas bill. Virtually all of the country’s natural-gas imports come from Russia. Late last year it was granted a discount that Moscow has threatened to rescind since the fall of Mr. Yanukovych.

“This now becomes an EU/U.S. problem: Who is going to lend Ukraine the money to pay the gas bill? If so, what will be the conditions?” said Jonathan Stern, an analyst at the Oxford Energy Institute.

A spokesman for Gazprom said that the threatened cutoff wouldn’t affect supplies to Europe, which gets about a third of its gas from Russia, much of it via pipelines that run through Ukraine.

 

 

In 2009, after the Russian energy giant switched off the supply to Ukraine, Ukrainian authorities began using the supply transiting their territory that Gazprom said was destined for customers in Europe. Gazprom then cut off the flow altogether, causing shortages and price increases for end customers.

 

“The EU, U.S. and IMF have just about three weeks to resolve this,” Mr. Stern said.

At which point it’s game, set match Putin once more.

Finally, what certainly helped Russia is that, as expected, China took the side of Putin, not of the “free world”, in what is now a very distinct and clear axis of power the New Normal dipolar world.

Obama uses the Same Nonsense as Putin | Armstrong Economics

Obama uses the Same Nonsense as Putin | Armstrong Economics.

Obama-Putin

We are still awaiting panic cycles at the end of the month so this is not over until the fat lady sings as they say, albeit we do not expect military action between any major powers before the October/November time period. For Obama to claim that a public vote in Crimea would violate the Constitution of Ukraine and International Law is really just as absurd that the same argument put forth by Putin that nothing in Kiev was legal because it was not signed by Yanukovych. There should be a vote, but it should be monitored independently to ensure it is real. To argue that no state may move to secede from a federal government is ridiculous. Obama said:

“Any discussion about the future of Ukraine must include the legitimate government of Ukraine. In 2014, we are well beyond the days when borders can be redrawn over the heads of democratic leaders.”

Texas has the ABSOLUTE right to secede from the United States if it so desired and the Washington has no right to invade Texas to prevent that – although they too would in the blink-of-an-eye. There are no “democratic” leaders in Kiev as of yet because this is a grass-roots uprising that distrusts anyone who has EVER been in government before.

Meanwhile, you cannot say the people have no right to decide their own fate because this violates the will of “democratic” leaders. No elected official has the right to trump the wishes of the people and let us call a spade a spade – the EU suppresses the right to vote because they are afraid the people in Europe would vote against the euro. The EU interfered with Italian elections and it threatened Georgios Papandreou of Greece that it was NOT ALLOWED to allow the people to vote on staying in the Euro. Greece back-down and did not allow that to take place – so much for democratic ideals.

Let the people decide and YES we can redraw the borders if the PEOPLE so desire. If splitting Ukraine PREVENTS war – then so be it. The word for “slave” in Latin is “servus”and that is the root of public servant. Politicians should remember they are NOT the dictators of the people, but the servants of the people. There can never be any justification to deny the people the right to be heard. That is the oldest right and those who like to use the Bible, it is called today due process for in Genesis God calls Able and asks where is his brother even though he knows the answer. God extended to him the right to be heard and that is the cornerstone of democracy. So do not use that word in the same breadth with calling it illegal to allow a the public to be heard.

Obama uses the Same Nonsense as Putin | Armstrong Economics

Obama uses the Same Nonsense as Putin | Armstrong Economics.

Obama-Putin

We are still awaiting panic cycles at the end of the month so this is not over until the fat lady sings as they say, albeit we do not expect military action between any major powers before the October/November time period. For Obama to claim that a public vote in Crimea would violate the Constitution of Ukraine and International Law is really just as absurd that the same argument put forth by Putin that nothing in Kiev was legal because it was not signed by Yanukovych. There should be a vote, but it should be monitored independently to ensure it is real. To argue that no state may move to secede from a federal government is ridiculous. Obama said:

“Any discussion about the future of Ukraine must include the legitimate government of Ukraine. In 2014, we are well beyond the days when borders can be redrawn over the heads of democratic leaders.”

Texas has the ABSOLUTE right to secede from the United States if it so desired and the Washington has no right to invade Texas to prevent that – although they too would in the blink-of-an-eye. There are no “democratic” leaders in Kiev as of yet because this is a grass-roots uprising that distrusts anyone who has EVER been in government before.

Meanwhile, you cannot say the people have no right to decide their own fate because this violates the will of “democratic” leaders. No elected official has the right to trump the wishes of the people and let us call a spade a spade – the EU suppresses the right to vote because they are afraid the people in Europe would vote against the euro. The EU interfered with Italian elections and it threatened Georgios Papandreou of Greece that it was NOT ALLOWED to allow the people to vote on staying in the Euro. Greece back-down and did not allow that to take place – so much for democratic ideals.

Let the people decide and YES we can redraw the borders if the PEOPLE so desire. If splitting Ukraine PREVENTS war – then so be it. The word for “slave” in Latin is “servus”and that is the root of public servant. Politicians should remember they are NOT the dictators of the people, but the servants of the people. There can never be any justification to deny the people the right to be heard. That is the oldest right and those who like to use the Bible, it is called today due process for in Genesis God calls Able and asks where is his brother even though he knows the answer. God extended to him the right to be heard and that is the cornerstone of democracy. So do not use that word in the same breadth with calling it illegal to allow a the public to be heard.

The West Should Butt Out of Ukrainian Politics | Jackson Doughart

The West Should Butt Out of Ukrainian Politics | Jackson Doughart.

Jackson Doughart

Posted: 03/05/2014 5:16 pm

The West, and especially the English-speaking West, has wrongly taken sides in the present conflict in Ukraine. On the one hand, our leaders have mimicked the line of the news media, which simplistically represent the revolutionary ouster of President Yanukovych as an occasion of desperate democratic action against a corrupt leader. On the other hand, various pundits have elevated Vladimir Putin’s Russia to the status of enemy, whose actions must be “contained” as an apparent foreign-policy sine qua non.

For instance, the Washington Post’s Charles Krauthammer argues that President Obama “sees Ukraine as merely a crisis to be managed rather than an opportunity to alter the increasingly autocratic trajectory of the region, allow Ukrainians to join their destiny to the West, and block Russian neo-imperialism.”

In response to the Administration’s claim that democracy “must not be imposed by outside intervention but develop on its own,” Krauthammer writes: “Ukraine is never on its own. Not with a bear next door. American neutrality doesn’t allow an authentic Ukrainian polity to emerge. It leaves Ukraine naked to Russian pressure.”

But this “authentic Ukrainian polity” is wrought with ethnic divisions, particularly concerning the Crimean peninsula, which is populated in a majority by ethnic Russians. The pro-Europe posture of the protesters is a reflection less of a considered moral preference than of a country torn in politics and identity between East and West. Krauthammer also fails to mention that the “Russian pressure” involved here is not a mere exercise in imperial Realpolitik. What’s really involved is the fear of Ukrainians that they may be unduly influenced by Russia, or worse, that they may lose territory. Meanwhile, the Ukrainian Russians fear that a more nationalist government will leave them with less clout and fewer political rights, such as the regional language recognition that the new parliament has just taken away from them.

Putin isn’t going to leave the Russian residents of the Ukraine, and especially those in Crimea, proverbially out to dry. It’s a matter of legitimate interest for Russia, whose ethnic brethren was stranded from the homeland when Ukraine declared independence, to use its geopolitical might to protect them. (One remembers that it was only in 1954 that Crimea was tacked onto the Ukrainian SSR — a fact of little importance when the entire country was run by the Kremlin, but of great importance now.) But so too it is legitimate for the new Ukrainian government to fight any specter of partition in Crimea. It will want to preserve the territorial integrity of its state and ensure that the substantial Ukrainian minority in that region remains within its sovereign borders.

Where does this leave Western countries and their national interests? As a rule, these kind of ethno-territorial conflicts involve deep-seated animosities that are scarcely appreciable to those unfamiliar with their histories. They also invariably involve the atrocious use of force by both sides, contrary to the tendency of news organizations and other media to portray such conflicts as one of “good guys” and “bad guys.” Evidently, not all human conflicts can be boiled down to matters of good versus evil.

A salient example is that of the Kosovo conflict of some 15 years ago. After having foolishly maintained an arms embargo that favoured the Serb forces over the Croats and Muslims during the Bosnian War, and subsequently intervening in pursuit of a peace agreement in 1995, the West came down like a ton of bricks on Serbia and Montenegro in 1999, which employed force to put down secessionist uprisings in the south. The Muslim Kosovar-Albanians formed a majority in the region and wished to break away from Serbia, either to form an independent state or to join Albania. The Christian Serbs, who formed a minority in Kosovo but a majority in the country, understandably wanted to keep Kosovo as part of their territory.

In hindsight, it remains remarkably unclear why the West was so decisively on the side of the Kosovar-Albanians. Perhaps we thought that extending a helping hand to the Kosovo Liberation Army would earn us sympathies in the Muslim world. Another idea, which is persuasive to me, is that the Western media collectively decided that Slobodon Milosevic was evil, which meant that any action his country took, however legitimate, was also evil. Today, Vladimir Putin has been deemed evil by our opinion-makers, meaning that any enemy of his is supposedly a friend of ours.

The Kosovo War had a further implication. When the United States and its allies directed NATO to perform air strikes on Serbia, it did so without the permission of the United Nations Security Council, of which Russia is a permanent and veto-wielding member. Perhaps more importantly, that case established the ability of a powerful state to choose one side in an ethnic conflict and commit military force in its support, seemingly without any overarching geopolitical reason.

Ironically, this plays directly into the hands of the loathed Mister Putin, who has called Obama’s bluff by first moving his troops to the Ukrainian border, and then into Crimea itself. Given the brazenness of our intervention in Kosovo, with its ignorance of international law as well as the wishes of other powerful states, on what remaining leg will we stand if Putin decides to forcibly remove Crimea from Ukraine? Such action, after all, would be ostensibly in support of a beleaguered minority seeking refuge from a nationalist government.

This is a very irresponsible way to even think about, and let alone conduct, foreign affairs. One doesn’t have to be an isolationist to see that some conflicts are not of paramount importance to the national interest, and hence to the calculation of sacrificing blood and treasure overseas. To the contrary, many such situations are, to use Krauthammer’s scornful words, “merely a crisis to be managed.”

Instead of making empty promises or threats, our message should be clear and decisive: “What is happening in Ukraine is a matter that its population has to sort out for itself. But, if asked, we will work with all interested parties to mediate a speedy and peaceful resolution.” No more, no less.

~
This piece also appears in the Prince Arthur Herald.

The West Should Butt Out of Ukrainian Politics | Jackson Doughart

The West Should Butt Out of Ukrainian Politics | Jackson Doughart.

Jackson Doughart

Posted: 03/05/2014 5:16 pm

The West, and especially the English-speaking West, has wrongly taken sides in the present conflict in Ukraine. On the one hand, our leaders have mimicked the line of the news media, which simplistically represent the revolutionary ouster of President Yanukovych as an occasion of desperate democratic action against a corrupt leader. On the other hand, various pundits have elevated Vladimir Putin’s Russia to the status of enemy, whose actions must be “contained” as an apparent foreign-policy sine qua non.

For instance, the Washington Post’s Charles Krauthammer argues that President Obama “sees Ukraine as merely a crisis to be managed rather than an opportunity to alter the increasingly autocratic trajectory of the region, allow Ukrainians to join their destiny to the West, and block Russian neo-imperialism.”

In response to the Administration’s claim that democracy “must not be imposed by outside intervention but develop on its own,” Krauthammer writes: “Ukraine is never on its own. Not with a bear next door. American neutrality doesn’t allow an authentic Ukrainian polity to emerge. It leaves Ukraine naked to Russian pressure.”

But this “authentic Ukrainian polity” is wrought with ethnic divisions, particularly concerning the Crimean peninsula, which is populated in a majority by ethnic Russians. The pro-Europe posture of the protesters is a reflection less of a considered moral preference than of a country torn in politics and identity between East and West. Krauthammer also fails to mention that the “Russian pressure” involved here is not a mere exercise in imperial Realpolitik. What’s really involved is the fear of Ukrainians that they may be unduly influenced by Russia, or worse, that they may lose territory. Meanwhile, the Ukrainian Russians fear that a more nationalist government will leave them with less clout and fewer political rights, such as the regional language recognition that the new parliament has just taken away from them.

Putin isn’t going to leave the Russian residents of the Ukraine, and especially those in Crimea, proverbially out to dry. It’s a matter of legitimate interest for Russia, whose ethnic brethren was stranded from the homeland when Ukraine declared independence, to use its geopolitical might to protect them. (One remembers that it was only in 1954 that Crimea was tacked onto the Ukrainian SSR — a fact of little importance when the entire country was run by the Kremlin, but of great importance now.) But so too it is legitimate for the new Ukrainian government to fight any specter of partition in Crimea. It will want to preserve the territorial integrity of its state and ensure that the substantial Ukrainian minority in that region remains within its sovereign borders.

Where does this leave Western countries and their national interests? As a rule, these kind of ethno-territorial conflicts involve deep-seated animosities that are scarcely appreciable to those unfamiliar with their histories. They also invariably involve the atrocious use of force by both sides, contrary to the tendency of news organizations and other media to portray such conflicts as one of “good guys” and “bad guys.” Evidently, not all human conflicts can be boiled down to matters of good versus evil.

A salient example is that of the Kosovo conflict of some 15 years ago. After having foolishly maintained an arms embargo that favoured the Serb forces over the Croats and Muslims during the Bosnian War, and subsequently intervening in pursuit of a peace agreement in 1995, the West came down like a ton of bricks on Serbia and Montenegro in 1999, which employed force to put down secessionist uprisings in the south. The Muslim Kosovar-Albanians formed a majority in the region and wished to break away from Serbia, either to form an independent state or to join Albania. The Christian Serbs, who formed a minority in Kosovo but a majority in the country, understandably wanted to keep Kosovo as part of their territory.

In hindsight, it remains remarkably unclear why the West was so decisively on the side of the Kosovar-Albanians. Perhaps we thought that extending a helping hand to the Kosovo Liberation Army would earn us sympathies in the Muslim world. Another idea, which is persuasive to me, is that the Western media collectively decided that Slobodon Milosevic was evil, which meant that any action his country took, however legitimate, was also evil. Today, Vladimir Putin has been deemed evil by our opinion-makers, meaning that any enemy of his is supposedly a friend of ours.

The Kosovo War had a further implication. When the United States and its allies directed NATO to perform air strikes on Serbia, it did so without the permission of the United Nations Security Council, of which Russia is a permanent and veto-wielding member. Perhaps more importantly, that case established the ability of a powerful state to choose one side in an ethnic conflict and commit military force in its support, seemingly without any overarching geopolitical reason.

Ironically, this plays directly into the hands of the loathed Mister Putin, who has called Obama’s bluff by first moving his troops to the Ukrainian border, and then into Crimea itself. Given the brazenness of our intervention in Kosovo, with its ignorance of international law as well as the wishes of other powerful states, on what remaining leg will we stand if Putin decides to forcibly remove Crimea from Ukraine? Such action, after all, would be ostensibly in support of a beleaguered minority seeking refuge from a nationalist government.

This is a very irresponsible way to even think about, and let alone conduct, foreign affairs. One doesn’t have to be an isolationist to see that some conflicts are not of paramount importance to the national interest, and hence to the calculation of sacrificing blood and treasure overseas. To the contrary, many such situations are, to use Krauthammer’s scornful words, “merely a crisis to be managed.”

Instead of making empty promises or threats, our message should be clear and decisive: “What is happening in Ukraine is a matter that its population has to sort out for itself. But, if asked, we will work with all interested parties to mediate a speedy and peaceful resolution.” No more, no less.

~
This piece also appears in the Prince Arthur Herald.

Bank Run Full Frontal: Ukrainians Withdrew 7% Of All Deposits In Two Days | Zero Hedge

Bank Run Full Frontal: Ukrainians Withdrew 7% Of All Deposits In Two Days | Zero Hedge.

Well that escalated quickly. It seems the ouster of Yanukovych, heralded by so many in the West as a positive, has done nothing to quell the fear of further economic collapse in Ukraine:

  • *UKRAINIANS WITHDREW AS MUCH AS 7% OF DEPOSITS FEB. 18-20: KUBIV
  • *DEPOSIT WITHDRAWALS STILL HIGH IN THE EAST, KUBIV SAYS

This is around a 30 billion Hyrvnia loss (over $3 billion) in just 2 days for the banks and the new central bank chief is considering “stabilizing loans” to help banks deal with the liquidity crisis(though Ukraine’s reserves stand at a mere $15 billion).

Reserves are in freefall… and will only get worse if the bank run continues…

Ukraine Bonds Re-Collapse As Russia Warns Of “High Chance Of Default” | Zero Hedge

Ukraine Bonds Re-Collapse As Russia Warns Of “High Chance Of Default” | Zero Hedge.

Russian bonds had rallied for 2 days on the heels of the ouster of Yanukovych and a hope-fueled strategy (supported by Goldman’s buy-buy-buy recommendation) that Europe or the IMF would save the day and fund them back to solvency. However, Russian deputy finance minister Storchak has a different perspective…

  • *UKRAINE FACES HIGH PROBABILITY OF DEFAULT: RUSSIA’S STORCHAK
  • *RUSSIA AGAINST INCLUDING $3B UKRAINE DEBT IN ANY RESTRUCTURING
  • *RUSSIA: NO LEGAL OBLIGATION TO GIVE UKRAINE REMAINING BAILOUT

And that has sent 3-month Ukraine bond prices tumbling once again…

 

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea.

CP  |  By Yuras Karmanau And Maria Danilova, The Associated PressPosted: 02/24/2014 3:46 am EST  |  Updated: 02/24/2014 8:59 am EST

Viktor Yanukovych

SIMFEROPOL, Ukraine – Ukraine’s acting government issued a warrant Monday for the arrest of President Viktor Yanukovych, last seen in the pro-Russian Black Sea peninsula of Crimea, accusing him of mass crimes against protesters who stood up for months against his rule.

Calls are mounting in Ukraine to put Yanukovych on trial, after a tumultuous presidency in which he amassed powers, enriched his allies and cracked down on protesters. Anger boiled over last week after snipers attacked protesters in the bloodiest violence in Ukraine’s post-Soviet history.

The turmoil has turned this strategically located country of 46 million inside out over the past few days, raising fears that it could split apart. The parliament speaker is suddenly nominally in charge of a country whose economy is on the brink of default and whose loyalties are torn between Europe and longtime ruler Russia.

Ukraine’s acting interior minister, Arsen Avakhov, said on his official Facebook page Monday that a warrant has been issued for the arrest of Yanukovych and several other officials for the “mass killing of civilians.” At least 82 people, primarily protesters, were killed in clashes in Kyiv last week.

Avakhov says Yanukovych arrived in Crimea on Sunday and relinquished his official security detail then drove off to an unknown location.

After signing an agreement with the opposition to end a conflict that turned deadly, Yanukovych fled the capital for eastern Ukraine. Avakhov said he tried to fly out of Donetsk but was stopped, then went to Crimea.

Tensions have been mounting in Crimea, where pro-Russian protesters raised a Russian flag on a city hall in one town and scuffled with police. Russia maintains a big naval base in the Crimean port of Sevastopol that has tangled relations between the countries for two decades.

Yanukovych set off a wave of protests by shelving an agreement with the EU in November and turning toward Russia, and the movement quickly expanded its grievances to corruption, human rights abuses and calls for Yanukovych’s resignation.

“We must find Yanukovych and put him on trial,” said protester Leonid Shovtak, a 50-year-old farmer from the western Ivano-Frankivsk region who came to Kyiv’s Independence Square to take part in the three-month protest movement. “All the criminals with him should be in prison.”

The speaker of parliament assumed the president’s powers Sunday, even though a presidential aide told the AP on Sunday that Yanukovych plans to stay in power.

The speaker, Oleksandr Turchinov, said top priorities include saving the economy and “returning to the path of European integration,” according to news agencies. The latter phrase is certain to displease Moscow, which wants Ukraine to be part of a customs union that would rival the EU and bolster Russia’s influence. Russia granted Ukraine a $15 billion bailout after Yanukovych backed away from the EU deal.

U.S. Ambassador Geoffrey Pyatt said the U.S. is ready to help Ukraine get aid from the International Monetary Fund.

The European Union, meanwhile, is reviving efforts to strike a deal with Ukraine that could involve billions of euros in economic perks. EU foreign policy chief Catherine Ashton is visiting Kyiv on Monday and Tuesday.

The protest movement has been in large part a fight for the country’s economic future — for better jobs and prosperity.

Ukraine has struggled with corruption, bad government and short-sighted reliance on cheap gas from Russia. Political unrest has pushed up the deficit and sent exchange rates bouncing, and may have pushed the economy back into a recession.

Per capita economic output is only around $7,300, even adjusted for the lower cost of living there, compared to $22,200 in Poland and around $51,700 in the United States. Ukraine ranks 137th worldwide, behind El Salvador, Namibia, and Guyana.

Ukraine has a large potential consumer market, with 46 million people, an educated workforce, and a rich potential export market next door in the EU. It has a significant industrial base and good natural resources, in particular rich farmland.

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea

Viktor Yanukovych Arrest Warrant Issued, As Ukraine Authorities Hunt President In Crimea.

CP  |  By Yuras Karmanau And Maria Danilova, The Associated PressPosted: 02/24/2014 3:46 am EST  |  Updated: 02/24/2014 6:59 am EST

Viktor Yanukovych

SIMFEROPOL, Ukraine – Ukraine’s acting government issued a warrant Monday for the arrest of President Viktor Yanukovych, last seen in the pro-Russian Black Sea peninsula of Crimea, accusing him of mass crimes against protesters who stood up for months against his rule.

Calls are mounting in Ukraine to put Yanukovych on trial, after a tumultuous presidency in which he amassed powers, enriched his allies and cracked down on protesters. Anger boiled over last week after snipers attacked protesters in the bloodiest violence in Ukraine’s post-Soviet history.

The turmoil has turned this strategically located country of 46 million inside out over the past few days, raising fears that it could split apart. The parliament speaker is suddenly nominally in charge of a country whose economy is on the brink of default and whose loyalties are torn between Europe and longtime ruler Russia.

Ukraine’s acting interior minister, Arsen Avakhov, said on his official Facebook page Monday that a warrant has been issued for the arrest of Yanukovych and several other officials for the “mass killing of civilians.” At least 82 people, primarily protesters, were killed in clashes in Kyiv last week.

Avakhov says Yanukovych arrived in Crimea on Sunday and relinquished his official security detail then drove off to an unknown location.

After signing an agreement with the opposition to end a conflict that turned deadly, Yanukovych fled the capital for eastern Ukraine. Avakhov said he tried to fly out of Donetsk but was stopped, then went to Crimea.

Tensions have been mounting in Crimea, where pro-Russian protesters raised a Russian flag on a city hall in one town and scuffled with police. Russia maintains a big naval base in the Crimean port of Sevastopol that has tangled relations between the countries for two decades.

Yanukovych set off a wave of protests by shelving an agreement with the EU in November and turning toward Russia, and the movement quickly expanded its grievances to corruption, human rights abuses and calls for Yanukovych’s resignation.

“We must find Yanukovych and put him on trial,” said protester Leonid Shovtak, a 50-year-old farmer from the western Ivano-Frankivsk region who came to Kyiv’s Independence Square to take part in the three-month protest movement. “All the criminals with him should be in prison.”

The speaker of parliament assumed the president’s powers Sunday, even though a presidential aide told the AP on Sunday that Yanukovych plans to stay in power.

The speaker, Oleksandr Turchinov, said top priorities include saving the economy and “returning to the path of European integration,” according to news agencies. The latter phrase is certain to displease Moscow, which wants Ukraine to be part of a customs union that would rival the EU and bolster Russia’s influence. Russia granted Ukraine a $15 billion bailout after Yanukovych backed away from the EU deal.

U.S. Ambassador Geoffrey Pyatt said the U.S. is ready to help Ukraine get aid from the International Monetary Fund.

The European Union, meanwhile, is reviving efforts to strike a deal with Ukraine that could involve billions of euros in economic perks. EU foreign policy chief Catherine Ashton is visiting Kyiv on Monday and Tuesday.

The protest movement has been in large part a fight for the country’s economic future — for better jobs and prosperity.

Ukraine has struggled with corruption, bad government and short-sighted reliance on cheap gas from Russia. Political unrest has pushed up the deficit and sent exchange rates bouncing, and may have pushed the economy back into a recession.

Per capita economic output is only around $7,300, even adjusted for the lower cost of living there, compared to $22,200 in Poland and around $51,700 in the United States. Ukraine ranks 137th worldwide, behind El Salvador, Namibia, and Guyana.

Ukraine has a large potential consumer market, with 46 million people, an educated workforce, and a rich potential export market next door in the EU. It has a significant industrial base and good natural resources, in particular rich farmland.

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