March 12, 2014
Remember when President Obama called for the ouster of longtime U.S. supported dictator, Hosni Mubarak, and then Secretary of State Hillary Clinton quickly endorsed Egypt’s Muslim Brotherhood party as the democratic government of Egypt with a $3 billion check? A year later Mohamed Morsi, was thrown out of office and jailed by the military coup leadership that toppled him as they have done with the past governments of Nasser, Sadat, and Mubarak (awaiting trial).
The President’s next stop targeted and demanded Yemen’s leader Ali Abdullah Saleh step down as the U.S. increased its drone warfare against the Yemeni al Qaeda elements.
The next stop on the Obama regime change train was Libya. Shortly after Mr. Obama’s acceptance of the Nobel Peace prize (link here), he addressed the nation with his argument for military action in Libya. He told the world President Muammar Kaddafi, Libya’s long serving dictator, must go and America was obligated to prevent massive bloodshed in the North African oil-rich country. After an air campaign, Kaddafi was murdered and replaced by al Qaeda sympathizers, which repaid Americans with a terrorist attack in Benghazi (link here). Now Libya has fallen into chaos and al Qaeda wannabes control much of the country.
The fourth stop began with President Obama demanding President Bashir al Assad to step down and then he drew red lines in the sands of Syria, which promptly launched a bloody war, displaced millions, leaving at least 150,000 dead. Unfortunately for President Obama, American’s melted lawmakers phones in such large numbers Congress and the President had no other option but to stand down. Of course, that did not stop the Congress from passing legislation to enhanced humanitarian aid including heavy weapons for the al Qaeda backed insurgents.
The fifth stop on the regime change express is Ukraine. The abdication of President Viktor Yanukovych, the seizure of Crimea by the Russians, and the collapse of the Ukraine debt-saddled economy suggest it will follow Egypt, Yemen, Libya, and Syria into sectarian violence and chaos.
But right on cue, the U.S. Congress easily approved a $1 billion loan guarantee package to support regime change in Ukraine. Is this just America attempting to buy love or will it turn out to be another down payment on hate?
What sets Ukraine apart from the other blunders in the Ukrainian situation surround Russia and the geopolitical factors involving private sector investments. Billions of U.S. dollars are intertwined in Russia; According to Ernst & Young, the auto industry alone is worth $75 billion per year with large investments from Ford and VW.
Nevertheless the largest card in Putin’s hand though is energy. Oil firms like BP, Exxon, and Royal Dutch Shell ensure energy flows freely regionally and almost guarantees any sanctions leveled on Russia will be superficial. It’s also important to point out that the Ukraine owes Russian oil giant Gazprom $1.89 billion, is it safe to assume any aid package sent to Ukraine will essentially go to Russia?
There is no disputing the fact that Europe is dependent on Russia for 25 percent of its Energy. Putin knows this and can use natural gas as a political weapon if the West moves forward with severe sanctions. In the case of Belarus, Bulgaria and the Baltic states, Russia provides nearly all the natural gas requirements, 90-100 percent. Russia’s iron-fist leader has already threatened retaliatory sanctions against the West and for those stepping outside the lines, Russia could either raise energy prices or cut off supplies altogether, crippling dependent global economies.
Russia’s extensive pipelines carry gas out of the country through a few different regions. The Yamal pipeline moves natural gas to German and Poland through Belarus. It carries gas south to Turkey using the Blue Stream pipeline. However the newly completely Nord Stream line skips Baltic countries and directly delivers natural gas to Germany.
In an effort to increase its energy muscle, Russia has already begun to plan the next massive South Stream pipeline. This will further Putin’s plan to exert its pressure as the world’s leading energy supplier. The new line would deliver gas across the Black Sea and into Austria, Hungry, Serbia and Bulgaria with additional lines to Italy. Experts concur this move would further exacerbate Ukraine’s relevance in the region.
Who’s backing whom?
The U.S. government gleefully jumped into the middle of the Ukrainian protests by supporting the violent protestors’ cries to dethrone a democratically “elected” president. Unanswered questions abound, who exactly runs Ukraine and what are America’s interests? Many leaders are Russian oligarchs, brutal Russian thugs, and Neo-Nazis. So why should America care about a Ukrainian civil war and the peninsula of Crimea?
These questions sparked a response from Dr. Rodrigue Tremblay, a Canadian economist and professor at the University of Montreal; “15 years ago, the U.S. was fighting for the right of self-determination of Croatia and Slovenia in Yugoslavia. Now, Obama says the U.S. does not recognize the rights’ of Crimeans to self-determination that is fully a right under the U.N. Charter (article 1, par. 2). What’s going on? Are these guys’ nuts or what?
Ukraine, as you know, is a unitary centralized state even though there are two distinct linguistic groups in two separate parts of the country. Surveys indicate that about 45 percent of the population speaks Ukrainian, 45 percent speak Russian, and 10 percent are bilingual. (NB: The official census indicates 25 percent of Russian speakers, but they are considered to have been rigged by the central government).”
The professor questioned what American’s would receive for their billion-dollar investment in the coup d’etat in Ukraine? “It got what the Obama administration wanted, i.e. the overthrow of the elected government, 12 months before the scheduled general elections. Some defense of democracy.”
Tremblay goes on to suggest that the West has clearly overreached in Ukraine and the policy of isolating and encircling Russia, which provoked a coup, ended up threatening Russia’s national security. That scenario put Russian President Vladimir Putin in a good position to call the West’s bluff and “see if they are going to risk going to war for Ukraine with all the huge negative economic and financial consequences.”
Financial ties abound, Foreign interests inside Russia
Leaders from many top U.S. companies met last week with senior White House advisors, reminding the Obama administration that billions of private dollars are invested in Russia with the approval of the Kremlin. Corporate CEOs are rightfully concerned that Putin will follow through with his retaliation threat against America.
Large businesses like GE released statements saying they were “monitoring the situation closely.” While others like Pepsi suggested the Ukrainian crisis would negatively affect U.S. $11 billion in annual exports and $14 billion in direct investments. “If we are unable to expand our businesses in emerging market and development markets… as a result of our investments, particularly in Russia, as a result of economic and political conditions…our performance could be adversely affected,” Pepsi told the Washington Post.
Further, the National Foreign Trade Council suggested America stands to be hurt in a couple of ways if the stand off moves ahead. “What we’ve been hearing from our members is a lot of concern that there are two ways America gets hurt in a game like this. One is by American sanctions, that put them out of business, and the other is by Russian retaliation, regardless of what we do,” William Reinsch, President of the National Foreign Trade Council told the Washington Post. He continued to say that his organization has not been shy about the ramifications of U.S. sanctions.
Other consequences facing nations doing business in Russia concern loans. For example, collectively, the EU has nearly $200 billion in loans and investments at stake and it’s highly unlikely that they would walk away from that kind of money.
Couple that with the EU’s reliance on Russian energy, and there’s a recipe for devastating their already fragile economies.
Illustrating the mass affects the EU could face if Russia follows through with retaliation, Dr. Tremblay acknowledged with time the EU could recover. “We forecast that Russia’s use of energy to extract political concessions will weaken over time, but will nevertheless remain formidable in parts of Central and Eastern Europe. While energy has served as an effective tool for Russia to wield political influence in Europe, Moscow is first and foremost concerned about maintaining the revenue from energy exports that has become so crucial for Russia’s own budget and economic stability. In this sense, maintaining European market share (and further developing market share in Asia) takes precedence over political manipulation for Moscow.”
After five years in office, President Obama’s modus operandi dictates that he will stand with the UN and EU against any Russian military action in Ukraine. Based on the President’s results in Egypt, Yemen, Libya, and Syria, Putin must be overjoyed.
But, of course, the President must have forgotten the Russians and restored pal, China, are permanent members of the UN Security Council and have veto power, which means the UN is useless to even try to intervene. Likewise, as demonstrated in the preceding paragraphs, the EU is linked to Russia and Ukraine is not worth the risk of billions of investment and energy supplies.
This type of political muscle is nothing new, the UN has supported secession movements in Timor, Czechoslovakia, Yugoslavia, and Montenegro, just to name a few. What makes Crimea different?
Perhaps, the U.S. needs look no further than Tunisia, the country that “was too small to care,” yet managed to give birth to the Arab Spring and settle on secular doctrine that doesn’t include an Islamic government (link here)
Late Breaking News:
It’s now being reported by (AFP) – “Ukraine will not intervene militarily in the separatist peninsula of Crimea, in order to avoid exposing its eastern border, Ukraine’s acting president told AFP Tuesday in an exclusive interview. In his comments, Oleksandr Turchynov, who came to power last month after violent protests brought down the previous pro-Moscow government, also slammed an upcoming referendum on Crimea as a “sham”, the results of which will be fixed in Moscow.
“We cannot launch a military operation in Crimea, as we would expose the eastern border (close to Russia) and Ukraine would not be protected,” Turchynov said as Crimea — a southeastern peninsula that has come under the de facto control of Russian forces — prepares to vote in a referendum Sunday on joining Russia. “What they call the referendum will not happen in Crimea but in the offices of the Kremlin,” the president said, hours after the pro-Russian authorities in the Black Sea peninsula voted for full independence from Ukraine, further escalating what has already turned into the worst East-West crisis since the Cold War.
“It’s a sham, most of the people of Crimea will boycott this provocation,” he added. “The Russian forces don’t intend to hold a referendum, they’re just going to falsify the results.”
Watch the San Diego 6 News segment here
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