The collapsing Ukranian economy cannot afford to pay for its gas supplies from the Russian company Gazprom. Possessed of extremely weak democratic and commercial institutions it has begun to display rogue state characteristics in failing to honour contracts, and trying to extract loans from Gazprom's clients, to whom it is contracted to deliver the gas supplied by Gazprom. Ukraine has been taking gas intended for delivery elsewhere from gas supplies it is contracted to allow to cross its territory, too.
Demand for steel, Ukraine's principal product, has collapsed. Its currency has been the object of speculation by Ukranian insiders and is already supported by loans from the European Union that were proffered to avoid misbehaviour over gas transits. The bunkered president of Ukraine and his henchmen are in the last phase of their stand off with the prime minister and government of Ukraine, who prefer an alliance with Russia rather than a disruptive and destructive realtionship with their neighbours at the behest of the Bush-Cheney administration in its last gasp. The Georgian operation failed. Now they are pushing on the Ukraine. The remarks by the United States that the European Union, Ukraine, and Russia should settle their 'differences' are impertinent at best. Imperial decline is better accepted with better grace.
In the meantime the Ukranian people might prefer to be represented by their prime minister and government in conducting relations with powerful neighbours on both sides of them, in conducting their good name in commercial and contractual relations, and in conducting other people's gas to its destination. Then we might all feel more like offering them a helping hand in their current difficult circumstances.
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7 comments:
Unfortunately, this is exactly the kind of rogue state behaviour which Britain showed over the Icelandic collapse, where we effectively stole Icelandic assets and made a bad situation considerably worse. For some reason Great Leaders only think in day-to-day terms rather than playing a slightly longer game.
The concept of 'rogue behavior' is extremely interesting Blue. Obviously if states that are usually acting legitimately perform actions that are outside contractual or legal behaviour or propriety they begin to partake of rogue status. That is, of course, why New Labour's behaviour over Iceland was so particularly pernicious - apart from, as you say, making everything much worse.
The Ukraine and the UK are not rogue states but they cannot expect to keep their good name and commercial reputations if they act as they have.
Thanks for the education, HG.
I do not know why people want so much gas anyway. I manage without it!
Going nuclear Mutley? Lot of people are over what's going on.
E-K, you will have read ND on Capitalists; it's a different take than Angels.
Perhaps it is not just the USA which is suffering from imperial decline but also Russia as well. Russia/Putin are far from blameless in their meddling in Ukrainian affairs and are not above playing divide and rule games in Ukrainian politics (to say nothing about fixing the occaisional elections and poisoning their opponents).
And if you want to look at how the Ukraine was treated within the Soviet Union/Russian empire - when its resources were systematically milked and depleted, while the local population was often led to starve and worse, it is pretty clear that the Russian government should not be letting ordinary Ukrainians go cold this winter - however its politicians behave. It is funny that the Russian Govt never plays thse games in the summer.
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