18 Comments
founding

One of the traditional problems faced by autocrats is that they often have no exit strategy that guarantees their lives and/or fortunes. So they tend to stay on until the very end and to the impoverishment of their people. If that principle applies to Putin, then shouldn’t the EU offer Russia a “Peter the Great Program” by which I mean a series of incentives leading to the greater assimilation of Russian into the European economy and, ultimately, way of thinking? Such a program could appeal to the Russian People’s sense of History (by finishing the job begun by one of their most famous historical figures) and their desire to be taking and treated seriously by Europe, while providing Putin with something of an off-ramp toward retirement.

It seems to me that Russia has an historic choice to make as to its long term survival between increasingly closer ties to Europe and risking becoming a wholly owned subsidiary of China. An outreach along the lines of a “Peter the Great Program” might be a productive alternative to constant instability and saber-rattling (if not outright conflict). I suspect the average Russian might, at a minimum, favor limiting corruption and cronyism while putting the Russian economy on a surer footing.

I would hope someone is giving some thought to such a project. Perhaps Prof. Tooze might sketch out the broad outlines of what such a project might look like, unless he finds the approach a non-starter.

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EU can offer Russia precious little, simply because it is not an independent geopolitical actor, and what Russia wants at this point is basic security that ensures its survival as a nation. EU is not jeopardizing their survival, US and NATO does by potentially deploying missile or missile defense systems in Ukraine in the future.

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Russia and Germany are natural allies, in the sense that each has what the other wants and can best get by cooperating with one another.

Germany has investment capital, high value-added industries, technical know-how and an aging population.

Russia has skilled workers, raw materials, markets for finished products, and investment opportunities that offer better returns than are available in Germany.

Germany needs raw materials to feed German factories; export markets for German autos, machine tools and whatnot; and investment opportunities in German factories to pay for German pensions, if possible, without anyone actually moving to Germany.

Russia needs investment capital; markets for raw materials; employment for skilled Russian workers; and technology transfer, with a chance to move up the value chain.

American policy has been quite focused on preventing Germany from realizing this natural alliance.

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Nothing new there: keep Russians out, Americans in, and Germans down (original NATO mission statement from Lord Ismay).

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founding

The only thing missing from your equation is that Russia does not have anything resembling Germany’s robust, independent judiciary - the best guarantor of contract rights. Consequently, any German investment runs the clear risk of having to eventually accommodate greedy Russian oligarchs. There is a reason the Magnitsky Act bears that name.

The alliance you sketch out is not as natural as you suggest, and appears a tad neo-colonial in outline.

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Looks like the German investment has more chances of being blown up (literally) by US than lost due to "Russian contract rights".

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Yeah, but when we do it, then that makes it okay!

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Feb 4, 2022·edited Feb 4, 2022

I would be cautious to use Magnitsky act (except as another semi-fake pretext to bash Russia) because investigation by Der Spiegel found out that it is mostly based on lies. The original article is sadly behind paywall (but it did cause quite a stir in Germany when it was first published, successfully memory - holed later which should not come as a surprise). Here is a summary:

https://citizensparty.org.au/magnitsky-act-dangerous-sanctimony-based-lies

https://www.azerbaycan24.com/en/anti-russian-sanctions-based-on-fraudster-s-tales-spiegel-finds-magnitsky-narrative-fed-to-west-by-browder-is-riddled-with-lies/

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I never said that investment in Russia bore the same risks as investment in Germany. Although I'd say it's the German Civil service more than the judiciary. Judges in Germany are just functionaries.

That said, comparative advantage, how does it work?

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founding

While few things are uni-causal, Germany’s failure to have gone ahead with the type of investment you suggest might well have to do with a calculation of the - shall we say - less than robust concern for property and contract rights that exist in Russia. Germany seems to have little problem ignoring the US when it feels necessary.

With yesterday’s announcement of the tight partnership between Russia and China, it appears that Putin has decided that his survival (which he no doubt conflates with Russia’s best interests) is better assured by making Russia an official junior partner to China.

While predicting the future is always a fraught exercise, I would venture to say that this alliance will not work out well for Russia. By choosing China, Putin can continue to enrich himself and his cronies, so long as he doesn’t run afoul of the occasional XI ukase. But what happens when Putin is gone?

Any accommodation with the West would require a sea-change in Russian politics, and as Gorbachev showed, that is extremely difficult to manage successfully. By failing to offer Russia a credible politico-economic alternative vision now, however, the EU in particular risks greater instability on its Eastern flank or worse.

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A quick google search reveals a great deal of German investment in Russia, much of it very successful.

Now imagine what those levels would be *without* sanctions.

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Feb 2, 2022·edited Feb 2, 2022

Perhaps this line offers one plausible understanding of the Russian advantage to pressing, in their way, Ukraine: "neither one [Russian] group, nor the other, knows what Putin really wants to get from the West and Ukraine". By pressing, Putin is also plumbing the extent of domestic will and desire among Russian citizens, to "make a hard break" from the previous rather soft unilateral US geopolitical dominance status quo of the world.... Russians will have to "get on board" on one platform or other soon, maybe that platform is to fully engage China as a suitor would. The US and west are basically saying "bring it": They've lined up in UAE (to face Iran), Ukraine, and South China Sea AT ONCE. Globalization is OVER. Costs are coming on all sides soon.

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One thing struck me: the Christie thread could be turned around and remain equally correct.

"Hard for non-Westerners to understand and accept, but this means there is no brighter future to look forward to, there is no sunlit upland to get to after going through a rough patch with Washington, the opposition is permanent, and the conflict is permanent, already now.

Deep down we ought to know this - think of election interference, military threats, assassinations on our soil, deliberate deception and manipulation on the part of American officials, permanent espionage.

And yet we keep on expecting some magical moment, some clarity, maybe some catharsis even. But that is not the way of the American Regime. Expect no fixed point, always expect a sliding scale of ambitions and full-spectrum violence."

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Great article, very informative. One thing that I was mulling though is that Biden administration cannot afford to let Putin walk away from this escalation as a winner. Nor majority of other Western countries governments; they are on the same page despite their Russia' dependence on oil and gas. They see Putin as the great villain that destabilize their democratic system and floods far rights with cash (and they are correct). And so if formally China is on top of US agenda, that is still a negotiable venue: China economy needs US and vice versa after all. Taiwan can be negotiated. Not so much with Putin' Russia (where population is scared still but tired of Putin' - as well as his vassals’ dictatorial regimes). I have the feeling that the sudden pull out from Afghanistan was also to prepare to address this threat. The more Lavrov does Gromyko the more weapons will be positioned. Then a sudden implementation of Magnitsky act can make Putin misstep.

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When I hear that name it makes me puke too. The fact that such warmongering hacks are still featured in Guardian tells you what kind of propaganda outlet it is.

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Luke Harding is a huge hack; an unfortunate inclusion.

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