Carrots and sticks: a strategic response to the Ukraine crisis

EWW Talk at the Institute of Governmental Studies panel on Ukraine, University of California, Berkeley, April 11, 2014

I continue to believe that the crisis in Ukraine is extremely dangerous and that the odds of a Russian invasion before the presidential elections on May 25 are significant. Moscow has managed to take control of Crimea without provoking a full-blown war, but the political situation is still very volatile in Kyiv, and it is even more so in eastern Ukraine, where armed pro-Russian separatists have been occupying regional administration and security service buildings since the weekend. Moscow is doing its best to stir the pot – the Russian media is referring to the uprising in the east as “the Russian Spring” – and if it succeeds in provoking significant violence, I think Putin will send in the troops – that’s what he’s said he’d do, and I don’t think he’s bluffing.

But the deeper reason why the crisis is still so dangerous is that the annexation of Crimea has put Russia in a very bad strategic position, one that I don’t think Moscow is going to accept.

In Crimea itself, it’s going to be very difficult for Moscow to keep the economy going without a land corridor from Russia. It is at least a six hour drive under normal circumstances from the Russian border to Crimea, and around ten hours from the nearest Russian city, Rostov, to Sevastopol, home of the Russian Black Sea Fleet. The Strait of Kerch, which separates Crimea from Russia, is some two miles wide, and building a bridge across it is going to cost billions of dollars and take years. The peninsula is dependent on Ukraine for electricity, natural gas, water, and most importantly food – it gets 85% of its food from the mainland. While the border has not yet been closed by Kyiv, freight traffic has fallen off dramatically, and Kyiv may well decide to close it down at some point. Meanwhile, the tourist industry in Crimea has completely collapsed, and a push by Moscow to increase Russian tourism will take years to effect and will come at the expense of the already very troubled effort to turn Sochi into a vacation destination. Crimea has been a relatively poor region of a relatively poor Ukraine, and it has long been a drain on Kyiv’s budget, a problem that Moscow is inheriting and one the will be made worse by Moscow’s decision to bring Crimean pensions and other social benefits up to Russian standards.


EWW photo, Sevastopol, September 2013

Beyond that, there are of course the strategic implications of the crisis for the Russian economy. Forecasts now have the economy growing at one percent or less this year; capital flight has already matched that for all of 2013; the ruble is down 21 percent from its post 2008 high, and equity markets are down some 13 percent since October. More alarmingly for the Kremlin, last year Russian economists lowered their assessment of the country’s long-term growth potential to around two to 2.5 percent, and that assumed no significant fall in oil prices and no sanctions. So the sanctions imposed so far matter, particularly politically, and they may matter a great deal economically if they ramp up after an invasion, but what matters most for the economy so far is the perceived spike in political risk for investors against a backdrop of deepening structural problems for the Russian economy.

Yet another major strategic problem for Moscow is its dependency on Ukrainian manufacturers for critical military equipment, including parts for Russian ICBMs, for gas-turbines for its naval vessels, for military aircraft and helicopter engines, and so on, all of which Ukraine may stop delivering and the great bulk of which are produced in factories in the east and south, which of course are the more Russophone parts of Ukraine that are the most likely targets of an invasion.

But most importantly, Moscow’s problem is that annexing Crimea has not solved its bottom-line issue, which is Ukraine’s external orientation and possible NATO accession. Even before the seizure of Crimea, it was clear that any new government in Kyiv was going move as close as possible to Europe. Now, Moscow is going to have to assume that, regardless of what Ukrainian or Western politicians have said recently, pressure is going to build to bring Ukraine, Georgia, and Moldova, and possibly even Finland and Sweden, into NATO. It also has to worry about its position in the Russophone region of Transnistria in Moldova, where some 1500 Russian “peacekeeping troops” are going to be isolated by a Western oriented Ukraine. And it can’t discount the possibility that, should Ukraine become another Poland, a pro-Western regime might eventually emerge in Belarus.

Let me just say something very quickly about Russian military objectives if Moscow does decide to invade. In my view, the program minimum, and the most likely scenario, would be an invasion directed at taking all or part of the two Donbas regions, along with the two southern oblasts along the Sea of Azov, Dnipropetrovsk and Kherson, thereby creating a land corridor from the Russian border to Crimea. Program medium would be to seize all nine eastern and southern regions, from Kharkiv to Odessa, which would cut rump Ukraine off from the Black Sea and link Russia up with Transdnistria. And the program maximum would be to try to take Kyiv and even Western Ukraine, which is probably well beyond Russia’s military capability and is very unlikely, but it’s also the scenario that runs the greatest risk of getting NATO directly involved.

I do not, however, think anyone should take comfort from Moscow’s post-Crimea strategic predicament because the implication is that the Kremlin is simply not going accept the emergence of a stable, pro-Western government in Kyiv. It may decide that the costs of invading outweigh any possible gains. But if so, it will continue to do everything it can to keep Ukraine and Georgia out of the Western institutional orbit, and out of NATO in particular. And Moscow is playing a long game, one in which it has many tools of pressure at its disposal – political, economic, and military.

That said, the annexation of Crimea also presents the West with an acute strategic problem. Stated bluntly, the problem is that Russia has a huge preponderance of force along its borders. Right now, there some 40,000 well-trained, well-equipped Russian troops massed along Ukraine’s eastern and northern borders, supported by modern tanks, artillery, armored vehicles, attack helicopters, fixed wing aircraft – the full Monty. That does not count Russia’s substantial naval, marine. and special ops forces in Crimea. Moscow has also dispatched 15 fighter SU-27s to Belarus, where Russian special forces will be conducting military exercises next week. More broadly, Russia has been increasing its military presence and activity all along its western border, from the North Caucasus to Finland.

It is also important to appreciate that there is an important time consideration here. Moscow can’t sustain a large force on high alert like this for very long, and meanwhile Ukraine is moving forces east and is making every effort to increase the military costs of an invasion. In particular, if Moscow intends to invade, it is very likely to do so before Ukraine’s May 25 presidential elections, in which polls show far right forces are likely to do very badly.

In response, NATO has decided to establish, for the first time, a “regular NATO presence” in eastern Europe, as Obama put in Brussels last month, although just how large that presence will be, and where it will be, and how regular, are still unclear. For now, NATO has reinforced its air defense system in the region – there are now 12 U.S. F-16s and 200 support personnel at two bases in Poland, and 6 U.S. F-15s in Lithuania, and reportedly six Danish F-16s on the way. There are also reports that for the first time NATO fighters will be deployed to Latvia and Estonia. Two NATO AWACS planes are patrolling over Romania and Moldova, with reports of a third one on the way, while the U.S. Navy is sending another warship into the Black Sea. Finally, Washington has announced that it plans to increase the number of U.S. marines in Romania that are part of the so-called Black Sea Rotational Force from 275 to 600.

Nevertheless, the stark fact is that NATO has virtually no ability to project power to Ukraine’s eastern borders. The air assets in Poland and Lithuania are roughly 1000 kilometers away; the AWACs are not kinetic; and an American warship in the Black Sea might give Russia pause before attacking nearby Ukrainian naval vessels but it will not deter a ground invasion in the east.

There is another, even more worrisome, problem for NATO defense planners, which is the extreme military vulnerability of its two smallest member-states, Estonia and Latvia, the only two to border directly on mainland Russia (that is, excluding Kaliningrad). Estonia is a country of 1.3 million and Latvia of 2.2 million, and neither has any credible military force on its territory – so far there are no NATO fighters, no Patriot batteries, no tanks, essentially nothing. Were Russia to launch a surprise ground attack on either or both, I don’t believe the West could do anything about it.

Thus the West has no option but to try to deter Russia from invading by diplomacy and threats of economic sanctions. But even if Russia doesn’t invade, the West is going to have to come up with a strategic response to the annexation of Crimea and to Russia’s obvious willingness to use hard power in its neighborhood. One option is to assume that Russia can be deterred by sticks alone – economic sanctions, economic and military assistance to Kyiv, strengthening NATO’s eastern defenses, deepening Ukrainian, Georgian, Moldovan, and perhaps eventually Belarusian integration into Europe, and pressing ahead with NATO membership for Ukraine, Georgia, Moldova, and perhaps Finland and Sweden as well. The rub, however, is that these measures virtually guarantee a hostile Russia that continues to resist, tooth and nail, what it considers to be Western encroachment, with all the attendant risks of conflict and economic and political costs.

The result would be a lose-lose game for all players. Consider where this course will take us. We will be in a long-term, no-holds barred contest with Moscow over the external orientation of Ukraine, Belarus, the South Caucasus, and even Central Asia, with an ever present risk of military conflict against a backdrop of extreme military vulnerability for Estonia and Latvia.

If we take Ukraine and Georgia into NATO, we will face, even more than we do now, the military challenge that we faced during the Cold War – forward-defense along a very long border directed at deterring a very powerful adversary that has a conventional military preponderance of force in the theater, a great many tactical nuclear weapons, and a strategic nuclear arsenal that more-or-less matches our own. And consider also the impossibly difficult economic background to this game. What do we do when Western economic assistance is met with increases in the price Ukraine pays Russia for gas? Keep in mind that Moscow just increased that price by 80 percent, and Ukraine is now being told it will have to pay considerably more for its gas than Russia’s other West European customers. Western tax payers are not going to want see economic assistance to Kyiv morph into subsidies for Gazprom and Russian military spending.

Unfortunately, that may well be where we are headed, but in my view we should at least explore the possibility of an alternative. Rather than proceeding as if Russia’s security concerns were entirely unreasonable, Washington could signal that it’s willing to discuss not only Russia’s “legitimate interests” in Ukraine (as both President Obama and Secretary of State Kerry have stated) but – more importantly – elsewhere as well. In my view, these legitimate interests do not include Ukrainian federalism, which is something for Kyiv, not Moscow, to decide, and which I believe Moscow intends to use to create more-or-less sovereign Russian protectorates in Ukraine’s east and south. Instead, we should try to use the crisis to negotiate an overarching security arrangement for a post-Cold War Europe that all parties can live with, including Russia – something that I actually think we should have done long ago.

To that end, the Obama Administration could suggest preliminary discussions with Moscow over an arrangement entailing formal military neutrality for Ukraine, Georgia, and Belarus. Each would be precluded from joining any military alliance and from having foreign troops on its territory. Each could, however, develop its own military capabilities as it saw fit, and each could choose its own political and economic relationships. Latvia and Estonia would remain part of NATO, but there would be no forward deployment of NATO forces in those two countries, a commitment that could be institutionalized through a new Conventional Forces in Europe agreement that would also limit the size and capabilities of NATO forces in the East European theater, and Russian forces in its western and southern military districts. Finally, NATO would agree not to add any new members that share a border with Russia, including Sweden and Finland.

The result would be a buffer zone between NATO and Russia that would reduce the risk of war and increase security for all parties. Russia would not have to worry about NATO incorporating additional countries on its borders, thereby relieving it of the need to increase military spending in the face of a slowing economy. Limitations on NATO and Russian troop deployments would enhance the ability of the neutral states to defend themselves. Estonia and Latvia would remain within NATO but with less reason to fear a revanchist Russia. And Ukraine could gain the breathing space that it needs to get its internal house in order.

Of course, negotiating a broad security arrangement like this would not be agreed upon quickly or easily, and it is very possible that Putin will have none of it. And it is also true that annexing Crimea has made negotiating with Russia much more difficult politically for Ukrainian and Western governments because doing so will be seen by many as appeasement in the face of naked military aggression. But critics should remember that the Nixon Administration initiated an earlier détente with Moscow for very practical reasons, and it did so despite the Soviet Union’s illegal annexation of the Baltic republics, imperial control of Eastern Europe, and the 1968 invasion of Czechoslovakia. I am certainly not suggesting that the West or Kyiv should recognize the legality of Crimean annexation. But I don’t think this should keep Western governments from trying to work out an arrangement that can reduce the risk of war and make Moscow less intent on permanently destabilizing Ukraine while playing military chicken with the NATO for the foreseeable future.