Ukraine: Cutting Through the Media Spin

By Doug French, Contributing Editor, Casey Research

Figuring out what’s going on in Ukraine is like following the plot of Tinker Tailor Soldier Spy.

Bloomberg reports Viktor Yanukovych’s ouster as “Moscow-backed,” while Al Jazeera calls Ukraine’s new government “Western-backed.” Which one is it?

We’re supposed to trust what’s reported on the ground. But as wordsmith Theodore Dalrymple says, we should take reports by foreign correspondents with a rim of salt on a margarita. Dalrymple has been on assignment in foreign lands a few times, and explains in Taki’s Magazine: “The bar at the one luxury hotel in town is often where the history, or rather report of the history, of an undeveloped country’s crisis is made.”

Critical thinking is not rampant in the press corps, while laziness is. Dalrymple goes on to write, “One of the things that surprised me was the ease with which an entire press corps could accept the most obvious untruth, usually convenient to some interested party or other, without any external compulsion to do so. I can only suppose that one of modern education’s purposes is to prevent people from thinking for themselves.”

What Actual Ukrainians Have to Say

For people on the street in Ukraine, economics trumps ideology. As my wife’s Ukrainian pilates instructor says, “The people just want to eat.”

Dalrymple’s preferred source is his plumber, a Ukrainian refugee. The plumber fled Ukraine a few years ago to work his wrench in Paris. He left because everyone in Ukraine was corrupt and he had to bribe people to get anything done. Dalrymple relates the tradesman’s story: “The opposition was as bad as the government, and all political demonstrations, which were frequent even then [before the current problems], were entirely bogus.”

He says that with unemployment sky high, demonstrating was one of the few ways to make money in Ukraine. “The political system’s corrupt and vastly rich oligarchs pay a small daily subvention to the otherwise unemployed who agreed to demonstrate in their favor,” explains Dalrymple.

In other words, demonstrators would agitate for the highest bidder, whether it be the government or the opposition. The amounts paid vacillated day to day. “Principle didn’t come into it; demonstrators changed from pro-government to pro-opposition and vice versa, according to the amount on offer.”

Auburn University economics professor Dr. Lilliana Stern echoes the plumber’s comments about corruption. She is a native of Ternopil, Ukraine, where some of the deadliest demonstrations have taken place.

“You have to bribe everyone,” she told the Opelika-Auburn News. “It’s a culture of corruption. If I took my kids to the pediatrician in Ukraine, I would have to give him a bribe. … If you are a college student, you have to bribe your professors for each exam you take.

“This is what people do not realize. It’s so corrupted from the ground up, and as you get higher and higher, the degree of corruption gets outrageous.”

The people are confused by what’s going on, according to my wife’s Ukranian pilates instructor, whose mother still lives in Ukraine. Also, she’s never even heard of this Crimea place. It’s referred to as Krim where she’s from.

She also says the people don’t care who is in charge. All they care about is food and work, and there isn’t enough of either to go around. Her mother tells her that she reads both the US and Russian versions of the events in Ukraine, and the two don’t, in any way, resemble each other.

Mind the Spin

Keep all of this in mind when you read that the Ukraine situation is some sort of grassroots political uprising, or that Vladimir Putin is a power-hungry ex-KGB guy who wants his former Soviet territory back at any cost. Be skeptical when you hear the US is a reluctant bystander that simply wants democracy to flourish around the world.

There’s a certain phone call between US Assistant Secretary of State Victoria Nuland and US Ambassador to Ukraine Geoffrey Pyatt, where Nuland says she’d like to “have the UN glue this thing [Ukraine] together and f**k the EU.” Nuland and Pyatt then continue to discuss strategies of working with the three opposition leaders in Ukraine.

While the US press is up in arms and pointing fingers at the Russians for leaking that conversation, the real story is somewhat different, as Daniel McAdams writes on LewRockwell.com:

“Caught red-handed actively planning and manipulating internal politics and acting as if Ukrainian opposition politicians were literally US agents to be ordered into this position or that in a new government, the US State Department behaved as a child with his hand discovered in the cookie jar.”

US State Department Spokesperson Jen Psaki did her best to stonewall during this briefing, but her sidestep wasn’t very good:

Q. Does not the fact that US diplomats purportedly are discussing who should and should not be in the Ukrainian government hint at some possibility of US interference here?

MS. PSAKI: Absolutely not… It’s up to the people of Ukraine, including officials from both sides, to determine the path forward. But it shouldn’t be a surprise that there are discussions about events on the ground.

Q. This is more than discussions, though. This was two top US officials that are on the ground discussing a plan that they have to broker a future government and bringing officials from the UN to kind of seal the deal. This is more than the US trying to make suggestions. This is the US midwifing the process.

PSAKI: Well, Elise, you’re talking about a private diplomatic conversation… Of course these things are being discussed. It doesn’t change the fact that it’s up to the people on the ground. It is up to the people of Ukraine to determine what the path forward is. …

Q: But I’m sorry, if you’re saying privately behind the scenes that you’re cooking up a deal, and then you’re saying publicly that this is up for Ukrainians to decide, those are two totally different things. I understand that diplomatic discussions are sensitive and you don’t want everything to come out, but those are two totally different—totally different positions.

This exchange supports Putin advisor Sergei Glazyev’s claim that the US is spending $20 million a week supplying Ukrainian opposition groups, a breach of a 1994 non-intervention agreement between the US, Russia, and the UK.

Clashing Interests

While observers pine for 1989, the current situation is much different. The deposed Viktor Yanukovych was not a Moscow plant, but democratically elected. The protesters are not all Western-leaning—they merely protest for the highest bidder. And remember, Russia didn’t make a move for three months while the protests went on. Putin didn’t act until Yanukovych was run out.

“It was the infantile, nostalgic meddling of Western governments in Ukraine,” writes Brendan O’Neill, “their use of Kiev as a stage on which to have a fancy-dress re-enactment of the Cold War years, which propelled that country towards ruin.”

If you’re basing investment decisions on whether the US gets involved, it already is. And if you think this skirmish will go down the memory hole by Tax Day, forget it. Exxon Mobil and Royal Dutch Shell are itching to begin drilling in the Black Sea for oil and gas. Need I say more as to why the US is interested in the region?

Likewise, Crimea’s port on the Black Sea, Sevastopol, is Putin’s only warm-water port, and Russia has 15,000 troops stationed there. What’s more, the Russian and Ukrainian navies have coexisted side by side there for years. As Katherine Jacobsen writes for Al Jazeera, “Political happenings in Kiev and Moscow rarely affect everyday life in Sevastopol.”

But that’s beginning to change. Neither Putin nor Obama will back away quickly.

The bottom line is this: Russia wants access to its port, the US wants access to the Black Sea, and Europe needs Russia’s gas. Ukraine is the fulcrum at which these divergent desires meet.

Right or wrong, this game of chicken won’t end quickly and may not end well. Ukraine may be a black swan waiting to land.