Monday, February 23, 2015

It's Time to ''Snowden'' Vladimir Putin !

Ronald Reagan once said, “The difference between a republic and a people's republic is a lot like the difference between a jacket and a straitjacket.”

The same can be said about lethal aid vis-à-vis non-lethal aid. When Ukrainian President Petro Poroshenko addressed Congress and referred to Obama's meagre offer of aid to his country he said, “Blankets and night-vision goggles are important, but one cannot win a war with blankets!”

Ukraine’s military cannot defeat Russia militarily. It is quite likely that any “lethal” military aid sent will be enough to antagonize Putin, but not enough to make a difference.

We cannot treat Ukrainians (or Russians) like chess pieces. Both economies have been battered by this war. In 2014, Russia lost $100 billion from lower oil prices, and another $40 billion from sanctions. While the average Russian is hurting, Vladimir Putin is not.

America’s policy toward Tsar Vladimir is reminiscent of Prince Horace in “The Whipping Boy.” It is the story of a spoiled prince, who is never punished when he misbehaves, because Jemmy, his whipping boy, is beaten in his place. Even Third Graders can understand the moral of the story: When a prince cannot be punished, he will never grow up.

Putin is not suffering and he doesn’t care how many Ukrainians and Russians suffer. Five thousand people have already died. Putin will only change course when his approval rating drops.
Right now it is above 80 percent, despite the fact oil prices are at less than $50 a barrel and the ruble has lost half its value since the war began.

Before Putin seized Crimea, his approval rating was gradually declining from 78 per cent in 2010 to 61 per cent in 2013. The patriotic feeling in Russia in 2014 was stoked by his adventuring in Ukraine. Since returning to the presidency in 2012, Putin has used the anti-American card to bolster his image as Russia’s protector. Without East-West tension, the Russian public would shift back to domestic concerns and Putin would be in trouble.

For this to work, we need to “Snowden” Putin. Whether you think Snowden’s actions were
misguided or deliberate treason, he sparked a big debate. Even with hindsight, it is, at best, naïve of him to think America was not free enough and then flee to China, and later Russia, for his “freedom.” Unlike the NSA, the KGB really is an evil organization and could use a Snowden.

Ukraine can trigger this by declassifying the 800,000 volumes of Soviet-era KGB documents in its possession. These documents are labelled “secret” and “top secret” because they contain a list of all the KGB informers in Ukraine.

Putin knows that a secret police force cannot function without a network of informers. In the past, declassifying the identities of these informers was resisted because of the fear of potential reprisals. For that reason, access to a victim’s file has been limited to relatives.

Since there are numerous marriages between Russians and Ukrainians, it is likely that Russians can learn about the fate of their relatives from the Ukrainian files. It might encourage them to end the war because it could be their only chance to know what really happened to those relatives. Reading these KGB files could also encourage some Russian speakers in Crimea, and the Ukraine’s Donbass region, to rejoin a federated Ukraine.

Once the KGB documents are declassified, the Ukrainians can launch a website where anyone can have unfettered access to any file. Instead of watching a soap opera on television, people can read true stories about how the KGB made others spy on their friends and relatives.

This could encourage files to be also declassified in the Baltic States and other former Soviet republics. This might even stir a real opposition movement among Russians who think the Soviet collapse was a “catastrophe.” For this war to end, and for Russia to move forward, we need to “Snowden” the KGB.

The reality is that when Putin invaded Ukraine, he had no idea how fragile the Russian economy was. The combined effect of Western sanctions and the crashing oil prices -- along with what has been estimated to at least a $1 trillion theft from the state by Putin's cronies -- has resulted in an economic crisis that's worse than 1998's.

In the past year the Ruble has devalued by almost 50%. This is particularly pernicious in a country that imports more than half its consumer goods. Imagine that half the things you buy have just
doubled in price . What would you do? Get mad at your leader, that's what.

Putin is not a man who deals well with other people's negative emotions toward him. His only reflex in these situations is to crack down. That, in turn, only incentivizes people to take more money out of the country, which further devalues the Ruble. This appears to be an unstoppable doom loop. Putin's KGB playbook of oppression works on individuals, not on markets. This bully-boy will never be able to bend the markets to his will.

The Way I See it.....this won't end well for anyone involved. There will be full-scale currency and capital controls in the future. When there's still not enough money, Putin will start expropriating and nationalizing companies just as that leftist idiot Hugo Chavez did in Venezuela. And when that doesn't work, he will start printing money, creating hyperinflation. The only thing that can save him is $100-a-barrel oil.

Ultimately, Putin's days are numbered. It may be a year, two years, or more, but his brand of dictatorship is incapable of dealing with such a grave economic crisis in such a big and unmanageable country. Meanwhile the human rights abuses, corruption and murder in Vladimir Putin's Russia will continue a while longer until the Russian people cry out; ENOUGH !

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