Is This Putin’s Ukraine Strategy?

ZeroHedge.com

“The West is afraid of a major war and Putin is exploiting that,” says one former Kremlin adviser, adding that “his end goal is a Ukraine that is a buffer state between Russia and the West.” After the recent rebel offensive, it’s now militarily possible to gain full control of Donetsk and Luhansk and to create a ‘land bridge’ to Crimea, and “without help, Russian troops can roll ever-deeper into Ukraine.” As Bloomberg reports, Vladimir Putin will continue his shadow war until he’s created quasi statelets in Ukraine’s easternmost regions with veto power over the country’s future, five current and former Russian officials and advisers said.

As Bloomberg summarizes, Putin’s strategy appears to be…

[He] won’t settle for less than broad autonomy for Ukraine’s mainly Russian-speaking regions of Donetsk and Luhansk, including the right to reject key decisions at the national level such as joining NATO, according to the people.

Putin is willing to wait until November, after Ukraine elects a new parliament and the heating season starts, to ensure his goals are met, in part by extending a natural gas cutoff to force a compromise if needed, one official said on condition of anonymity after speaking with Putin last week.

…

“Putin’s goal is to force Ukraine to its knees,” said Stanislav Belkovsky, a Kremlin adviser during Putin’s first term who heads the Institute for National Strategy in Moscow. “He wants a federal structure to put part of the country under Moscow’s informal control and block NATO membership.”

Last week, Putin warned against any “aggression” toward Russia, noting the country remains “one of the world’s biggest nuclear powers.”

“The West is afraid of a major war and Putin is exploiting that,” said Belkovsky, the former Kremlin adviser. “The point is to frighten the West and Ukraine into thinking he’ll take Kiev and change the map of Europe unless he gets what he wants. He’s bluffing.”

Bluff or not, Putin’s strategy is clearly working, according to Dmitri Trenin, head of the Carnegie Moscow Center.

“A cease-fire is an important victory for Russia,” Trenin said by phone. “If it actually goes through, Russia will be bargaining from a position of strength. Putin’s strategy is evolving. His end goal is a Ukraine that is a buffer state between Russia and the West.”

However, both the U.S. and the EU have ruled out military intervention in the current conflict.

That and the failure of sanctions to influence Russian behavior has given Putin a “free hand,” according to Ian Bremmer, president of the Eurasia Group, a New York-based political risk research and consulting firm.

“For Putin, you have to feel that you’re not going to be challenged seriously,” Bremmer said in an interview with Bloomberg Television on Aug. 28.

The endgame?

Because of that, Ukraine’s only way out is to admit defeat, said Arbatov, the former deputy chairman of the Russian parliament’s Defense Committee.

“The longer Ukraine waits, the more territory it will lose and the harsher demands it will face,” Arbatov said.

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So that’s all very ominous for the West. However, there is a different side of this coin…

From Grandmaster to Grand Farce (via Gavekal’s James Barnes)

At first glance, Vladimir Putin’s strongman status was confirmed by the release of a seven point peace plan yesterday that reputedly had him call for Ukrainian troops to withdraw from areas of their own country. Such a demand followed Putin’s demand over the weekend that Kiev begin independence talks for southeastern Ukraine. These are the new realities that NATO leaders must chew over during a summit that starts today and is being billed as the most significant in 25 years. However, we would demur at the notion of a new leviathan in the Kremlin. In reality, Putin’s hugely risky escalation in eastern Ukraine was driven by a realization that his proxies had failed and Russian prestige was set for a battering.

Flushed with the glow of easy success in Crimea, Putin openly backed separatist rebels who were both militarily incompetent and enjoyed scant sympathy among most of eastern Ukraine’s population. His biggest mistake was concluding that Ukraine would cease to operate as a unitary state and so lack the will to fight. All this explains why the separatist rebels were on the brink of defeat ten days ago, resulting in a hastily arranged Russian invasion. Having cast himself as defender of the greater Russian Volk, defeat in Ukraine would have fatally weakened Putin’s credibility.

Putin may have staved off an immediate defeat, but the stakes have undoubtedly been hugely raised. As we see it there are three broad scenarios that could play out in the next few months:

Scenario #1: Moscow and Kiev reach a comprehensive peace agreement that provides autonomy for eastern Ukraine and protection for Russian speaking citizens, while at the same time allowing the country to pursue a closer economic relationship with the European Union. Membership of the North Atlantic Treaty Organization would be explicitly ruled out.

Scenario #2: The status quo holds and Russian soldiers advance no further. A frozen conflict develops akin to the situation in South Ossetia or Transnistria. Small scale fighting aimed at consolidating Russian gains may flare up, but this does not escalate into a larger conflict.

Scenario #3: A full invasion of Ukraine by Russia with the army operating openly to establish, at a minimum, an independent buffer region.

For the moment, Scenario #1 seems highly unlikely. Both sides would need to make major concessions and with Ukrainian parliamentary elections being held on October 26, President Petro Poroshenko will face intense pressure not to give an inch to the separatists. It is also unlikely that Putin would countenance deeper economic integration with Europe as this would frustrate his Eurasian Customs Union.

Scenario #3 also seems unlikely, for despite bellicose talk of taking Kiev in two weeks a full scale Russian invasion would be ruinously costly in blood and treasure. Despite Moscow’s claim that international sanctions will be ineffective in swaying domestic opinion, it should be remembered that Putin’s popularity has been built on rising living standards and sound economic management which followed the chaotic Yeltsin years. For all the talk of becoming a “war time” president, we doubt that Putin will abandon the promise of a Russian dream of rising middle class prosperity.

The most likely outcome is an inconclusive Scenario #2 with the emergence of an unstable buffer region in eastern Ukraine, blighted by low intensity conflict. To be sure, this is a more difficult conflict to contain than others in the Caucasus since Kiev has more capability to project force and the frontline is not contiguous or divided neatly by terrain features. However, the deterrent effect of huge costs for both sides in the event of a full-scale conflict should be enough to avoid Armageddon.

Longer term, the situation looks worse for Putin. Russia may have already lost the Ukrainian people; as recently as 2011 84% of the population held a favorable view of Russia with only 11% holding a negative one. As of a few months ago, 60% of Ukrainians viewed Russia badly with only 35% having a positive view. Considering that Ukraine is the birthplace of Russian civilization, Putin looks to have lost the PR war.

Russia may also face a resurgent NATO. Already NATO has said it will open bases in former Warsaw pact countries. A greater risk is that Russia’s actions in Ukraine finally shakes Europe out of its defense lethargy and induces rearmament. Despite the eurozone’s malaise, this may trigger realization that liberal states cannot rely on the US defense shield forever.

Most damagingly for Russia, its ‘special’ relationship with Germany may have ended. Since the Berlin Wall fell the integration of Russia into western economic, political and social norms has been a cornerstone of German politics. Now, however, Berlin is taking the tougher line over Ukraine, even while other European states vacillate over the economic fallout. Angela Merkel seems to have decided that a long-term stand on values is more important than short-term economic pain caused by sanctions. The German-Russian relationship seems to have ruptured and the impact on Russia’s economic modernization will be high.

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In the meantime, US and Europe are agreeing on more sanctions for Russia

*RHODES: U.S. IS WORKING ON PACKAGE FOR NEW RUSSIAN SANCTIONS
*U.S. CONSULTING WITH EUROPE ON NEW RUSSIAN SANCTIONS: RHODES
*U.S. WORKING ON NEW SANCTIONS ‘FOR SOME TIME NOW,’ RHODES SAYS
*HOLLANDE SAYS EUROPE TO GIVE DETAILS ON SANCTIONS TOMORROW

So more costs for Europe…