Plain, old-fashioned capitalism will prevent a new cold war between the United States and Russia over Ukraine and Russia’s gobbling up of the Crimean region. Capitalism, plus the fact that probably not one American in a thousand could locate Crimea on a map, and even the most hard-headed US political analysts have trouble coming up with a decent definition of what US interests in Ukraine might be.
Helping to contain the crisis is the fact that Russia, Europe and to a lesser extent the United States are tied together in a powerful web of financial and economic ties that didn’t exist, say, during the real Cold War. Their influence runs counter to the many, many cries from hawks to impose tough economic sanctions on Russia, as if the giant Eurasian power were a small “rogue state.” The Washington Post, for instance, said in an editorial:
Some argue that the West lacks the means to damage the Putin regime or that the United States cannot act without Europe, but neither claim is true. Banking sanctions—denying Russians and their banks access to the U.S. financial system—could deal a powerful blow. Mr. Obama must respond to Mr. Putin with measures that force the Russian ruler to rethink his options.
But, as CNN reports:
Russia is the European Union’s third-biggest trading partner after the United States and China, with goods and services worth more than $500 billion exchanged in 2012. About 75% of all foreign direct investment in Russia originates in EU member states, according to the European Commission.
In addition, Russia is the single biggest supplier of energy to the European Union. British energy firm BP is the second-largest shareholder in Russia’s leading oil producer Rosneft, and some of the biggest energy companies in Germany, the Netherlands and France are invested in a joint venture with Russian gas giant Gazprom.
And, in a lengthy interview in The American Interest, Zbigniew Brzezinski points with regret to the fact that British bankers, who have large deposits of Russian cash—particularly from Russian oligarchs—are resisting any sort of confrontation over Ukraine:
The British seem inclined to argue, “Well, there’s a lot of Russian money in our banks.”… The bankers doubtless have a lot of influence, particularly in political systems in which money is increasingly the mechanism that oils the “democratic process.”
Earlier, the BBC had reported that a document carried by a top British official read: “The U.K. should not support for now trade sanctions or close London’s financial center to Russians.”
The New York Times, in a long March 7 piece analyzing US and European business interests in Russia and their effect on the politics of the situation, quoted several executives with Western firms who clearly want to cool the crisis talk:
European businesses “have no interests in any deterioration of the current international situation linked to Ukraine,” Frank Schauff, the chief executive of the Association of European Businesses in Russia, said on Friday. “We call upon all parties to engage in a constructive dialogue, which will secure stability, welfare and economic growth on the European Continent.”
Among American companies cited in the Times are Pepsi, Ford and John Deere. The Times quoted Ken Golden, director of global public relations for Deere, in its piece:
While Russia represents less than 5 percent of Deere’s total equipment sales, the company recently cited Russia as being key to its future growth. “We urge political leaders to solve this issue without violence and in accord with international agreements,” Mr. Golden said.
It even extends to the defense industry. According to Defense News, in a piece titled “Amid Ukraine Crisis, EU Plays It Safe,” various European arms manufacturers, including in Sweden, value current and potential sales to Russia. France is apparently insisting that it will continue to sell arms to Russia, including a $1.7 billion deal for two Mistral-class helicopter carriers. Said one expert quoted in the piece:
It looks like the Europeans are extremely keen to do everything except anything that hurts their commercial interests. There is zero appetite to hurt business interests, and arms sales fit into that category.
Still, while Vladimir Putin and his nationalist Russian base might believe that ancient monasteries, the Kievan Rus and heaven knows what else justify the illegitimate annexation of Crimea and Russia’s overweening influence in Ukraine, and that Russian-speaking citizens of Ukraine need protecting, Moscow’s actions in Ukraine are nearly certain to contribute to a deeper political divide between the United States and Russia. Just as the unilateral US and NATO intervention in Kosovo in 1998–99, the illegal US invasion of Iraq in 2003, and the US-NATO war against Libya in 2011 all bolstered Russian nationalism and strengthened the Russian military, Russia’s occupation and pending annexation of Crimea will do the same in reverse. Hawks, pro-NATO militants, supporters of building up US military forces and missile-defense systems in Eastern Europe, and critics of President Obama’s defense cuts, will all be aided greatly by Putin’s actions.
We’ll review the bidding on that tomorrow.