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The recent Russian move into Crimea has aroused notable and expected concern in the United States, Canada, and the European Union.  But the crunch reveals an appalling lack of realism and foresight by both the US, Canada and the EU. 


The Soviet Union ceased to exist in 1991, but EU and US political leaders seem to have forgotten that Russia did not. Nor have historic (and current) geopolitical realities changed with respect to Crimea, which was as strategically important to Russia as it was to the USSR during the USSR’s “brief”  time on the world stage (70 years is the wink of an eye in historical context).


One should be rightly focused upon and concerned as to how the EU the US and Canada could have ignored Russia while pursuing a bilateral alliance with Ukraine!  It was akin to the laughable fantasy that could be imagined had the US ignored Canada and facilitated a wish of Alberta and British Columbia to enter into a political alliance with the United States.


My point is that we must recognize geopolitical realities, such as that Russia considers Crimea strategically vital.  Lest we forget,  the Russian Black Sea fleet remains at Crimean ports,  and but for the historic anomaly of Russia ceding Crimea to Ukraine in 1954 when the two nations were briefly effectively one nation, Crimea would still be recognized as part of Russia.  How absurdly short is our historical perspective!


EU governance, as we all know, is in the hands of a Commission and an inscrutable bureaucracy.  Too many chefs, too many hands in the drawer, almost no long term historical perspective. It reminds me of the USSR in its heyday, a centrally governed bureaucracy without meaningful reach.  It is no wonder that such an ineffective “governing” structure as the EU’s ignored Russia and pursued a bilateral alliance with Ukraine.


Moreover, how could US and EU intelligence agencies, and thus the US and EU governments, possibly fail to get the drift of Russia’s approach to Ukraine?


It suggests a failure to comprehend Putin’s domestic problem:  his country has yet to recover from the greatest systemic failure and economic living standard contraction ever experienced by a nation-state in peace time.


Contrast this with Germany’s capitulation to the Western alliance in 1918, which ended the First World War.  Defeat in war led to economic collapse.  The Soviet capitulation after the “cold war” occurred without a shot being fired.  The results in both cases were a failure by the subsequent governments to raise the living standards in the broader society.


Economic and social despair in the society will always lead to political instability that creates the opportunity for extremists and demagogues.  Thus:  Putin’s problem. The West didn’t deal any more effectively with Germany after World War One. 


To flesh it out just a bit more – After the Soviet collapse in 1991,  the West arrived in Russia in the “person”  of IMF aid, as well  as hordes of advisors and corporate raiders, determined to give the Russians a crash course in the worst that capitalism has to offer.  The new Russian oligarchs smelled the fast money, and an aberrant form of capitalism took hold.  The Russian “surgery” saved the patient from socialism, only to leave it a capitalist paraplegic.


That only a fraction of the money pledged to Russia after 1991 was actually delivered, while much of the rest ended up in fraudsters’ pockets in the West was apparently just a dress rehearsal for the even greater raids on the public treasury that occurred in Iraq and Afghanistan by way of fraudulent transfers, in more recent times.


Ordinary Russians today have very little respect for the social or political establishments in the EU and the US; many simply feel cheated.  They see the return of Crimea as simply their due patrimony.


My analysis of the Ukraine crisis is that the West’s failure to assist Russia to solve the problem it faced in 1991, to say nothing of its effectively hampering investment in economic production , led to further declines in the broader standard of living there and proved to be an object lesson in avoiding the Western “do-gooders”. 


Furthermore, when EU and US leaders employ empty rhetoric, reflective of sloppy thinking, comparing Putin to Stalin and Hitler, the Russians simply take it as an insult, fueling further disappointment with the West and a degree of anger.   Russian blood (much like ours) is indeed thicker than water.


The end result of our empty posturing is that Russian attention is thereby distracted from the very real socioeconomic and environmental issues that really matter to their society.  Instead, we whip up an aggressive approach in response.  It is entirely reasonable to believe that President Putin knows that his future and his legacy depend on his administration’s ability to raise Russian living standards by solving the impediments to investment in economic production and employment. 


It is further reasonable to assume that Western leaders realize that Western societies can only benefit from a more prosperous and thus less militarily aggressive Russia.


This reality is easy to forget in universities and government Ivory Towers.  Economic production, social satisfaction and political stability are not created in Moscow, Washington DC, Ottawa or in Brussels; they are created in local and regional economies. 


Sadly, the issues I raise here, exemplified in the Canadian/Swedish IISRE Initiative, were ignored when the time came for applying good economic sense to the Russian situation; had IISRE existed in 1991, perhaps its valuable research on these topics would have been ignored then as well.  


The message is once again given; and just as in 1991, nothing will apparently change. Ignorant counter-reaction is once again the order of the day to the world’s peril.           


A wise Western approach would be a pragmatic one.  The US and the EU should accept the annexation of Crimea by Russia, and Russia should be a party to any treaties between the EU and Ukraine. 


We should then pursue an enlightened approach to helping Russia, along the lines and spirit of the Marshall Plan, thereby assisting President Putin to mitigate the impediments in Russia that hamper investment in economic production.   In that manner, responsible private investment in business, creating employment in local and regional economies, might take shape in Russia, benefitting the EU, the Americas, and Putin himself. 


Along the lines of my old dictum, “the behavior in government reflects the level of understanding and the moral and ethical value in the society that make up the economy”, we must appeal to Russian society itself to take responsibility for its economic problems.


In addition, I don’t mean to suggest by what I have said here that President Putin himself doesn’t have a solemn responsibility to respond in kind to enlightened Western outreach, in the interest of fostering sustainable economic development throughout the world. 


March 18, 2014


Kell Petersen