Opinion

Ian Bremmer

Ukrainian President Yanukovich has bad and worse options

Ian Bremmer
Dec 13, 2013 15:56 UTC

Since the Ukrainian government’s November 21 decision to suspend free trade talks with the European Union, the country has descended into crisis. Hundreds of thousands of protestors have taken to the streets, angry with President Viktor Yanukovich’s choice and its implications. Violent clashes between law enforcement and protestors have stoked tensions even more; most recently, the government’s failed attempt to forcibly clear protestors out of Independence Square — their nexus of operation — has made the chance for compromise even bleaker.

So how did we get here? Ukraine is the perfect case study for what I’ve referred to in the past as a “shadow state”: it cannot free itself from Russia’s overwhelming influence, nor is it beneficial or domestically popular for it to give in and integrate with Russia further. So while Ukraine cannot leave Russia’s orbit, in recent years, Yanukovich’s government has managed to juggle between the competing spheres of influence of Russia and the European Union.

However, this fragile status quo has fallen apart thanks to a worsening economic situation and more pressure from Russia. Ukraine faces a three-prong predicament, starting with a struggling economy that is forcing Yanukovich to look for aid — or risk full-fledged economic crisis or default.  Second, the EU and Russia, the two major powers that could provide this assistance, have serious quid pro quos attached to any economic relief they might offer. Third, the two powers’ demands have become mutually exclusive: the EU won’t accept Ukraine if it gravitates toward Russian President Putin’s geopolitical pet project, the Eurasian Union, while Putin won’t accept Ukraine if it moves toward EU partnership.

All of this is taking place in a country that broadly favors tighter ties with the EU, but is economically dependent on Russia: defying its neighbor could lead Russia to engage in trade retaliations. The decision to veer away from the EU has led to unrest on a level we haven’t seen since the Orange Revolution of 2004. And for President Yanukovich, these tensions play out against the backdrop of the 2015 presidential election. Now Yanukovich has two challenges to address: the growing financial storm, as well as the fervent public protests and opposition. There is no good path forward — there are only bad and worse choices — but Yanukovich’s decisions could determine his political survival, and Ukraine’s future.

So what can Yanukovich do? For now, first and foremost, he needs to continue to move back toward Europe politically to appease protestors and opposition groups, while veering toward Russia for stopgap funding (to buttress financial support from domestic banks and oligarchs). Yanukovich also has to manage public anger, first by not cracking down on the protestors (like what we saw earlier this week), and second, by reshuffling the cabinet in some way — perhaps by jettisoning Prime Minister Mykola Azarov for a candidate more aligned with the interests of key oligarchs, and more favorably disposed to Europe.

Romney’s foreign policy: Reagan redux

Ian Bremmer
Oct 13, 2011 15:55 UTC

By Ian Bremmer
The views expressed are his own.

After yet another GOP debate where foreign policy took a near-total backseat to economic and domestic policy, Mitt Romney is in the catbird seat for the nomination. He even locked up the endorsement of Tea Party AND Republican machine favorite, New Jersey Governor Chris Christie. Romney’s only problem: it’s October 2011. Not one primary has yet taken place. Romney will have to return to his foreign policy platform to expand it, should he be fortunate enough to make it to the general election. And based on the speech he gave at The Citadel, we can already see that Mitt Romney intends to return to the American exceptionalism of the Ronald Reagan and George W. Bush eras.

For Romney, as for many politicians of both parties in decades past, the United States is not just a big and powerful country. Rather, it is the only country in the world that deserves superpower status. What’s unfortunate for Mitt and his all-star, Bush-heavy foreign policy team is that, these days, that line of thinking is more nostalgic than realistic. (By the way, though Romney was almost bombastic at times, calling Iran’s leaders “suicidal fanatics,” his actual policies are unlikely to reflect or adopt that tone — at least not with his foreign policy team as constituted now.) The idea of the U.S. as the leader of the free world is at a post-WWII nadir. However, that’s not because some other country, like China, has risen to fill the vacuum. No, the fault is wholly our own.

In fact, right now there’s a global debate about whether the U.S. really deserves its superpower mantle, given the political and economic issues of recent years that have unquestionably eroded its leadership position. It’s helpful to compare the two camps:

The fiscal fix Europe can’t bear to embrace

Ian Bremmer
Jul 20, 2011 15:01 UTC

By Ian Bremmer
The opinions expressed are his own.

The European Union now faces a sovereign debt crisis that threatens the viability of the entire experiment, one that looms over the economies of even the sturdiest EU countries. Fair or not, debt crises in Greece and Portugal, and the spectre of them in Spain and Italy, have markets questioning whether the eurozone remains viable.

There is some good news. Everyone in Europe, from Germany’s state-level officials to Members of the EU Parliament, takes this issue seriously. The time for kicking the can down the road has passed. The bad news is that the only long-term solution to the crisis is the one that may be a bridge too far for most of the major players: a fiscal union that controls spending across all of the EU’s economies. Fiscal union might sound like a politically impossible concept, but market leaders, like Pimco’s Mohammed El-Erian, are urging Europe to at least consider, ”a unified European balance sheet,” as a logical and badly needed extension of the currency union. To join the euro, governments surrendered control of their monetary policy. Surrendering control of fiscal policy amounts to an enormous psychological step.

A little background: EU member states still control their own spending — and their indebtedness. The EU specifies spending and debt limits for its member nations, but can’t really enforce its guidelines. That’s why Greece was able to hide the problem that too many of its citizens have evaded income taxes for decades, despite the government providing them substantial social benefits. This problem created the country’s debt crisis. Local control of fiscal policy also allowed Portugal to base its budgets on wildly optimistic economic growth projections for years. That’s why the debt crisis spread out of control — every country kept its own books, but few of the strong countries realized that to protect the euro, they would have to bail out weaker countries that rode the economic boom for years—including up to and during the global financial crisis and its aftermath.

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