Merkel warns Russia of 'massive damage' if it persists

[geek tragedy]

Source: Reuters

The chancellor, using her strongest language since the start of the crisis and removing any suspicion that Germany might seek to avoid a confrontation with President Vladimir Putin, said his actions would lead to "catastrophe" for Ukraine and much more.

"We would not only see it, also as neighbors of Russia, as a threat. And it would not only change the European Union's relationship with Russia," she said in a speech in parliament. "No, this would also cause massive damage to Russia, economically and politically."

...


Merkel reiterated that if Putin continues to snub diplomacy and lets the referendum in Crimea go ahead, the EU - in close coordination with Washington and NATO - would impose tougher sanctions than the largely symbolic measures taken so far.



Read more: http://www.reuters.com/article/2014/03/13/us-ukraine-crisis-merkel-idUSBREA2C0HC20140313

---

President Obama has handled this very well, he's avoided taking precipitous action, and the payoff has been a united front against Russia.

Russia is not going to be able to play the gas card to great effect--Europe's reserves are bursting due to the mild winter, and spring will soon be here.

[William769]

1. "a united front against Russia."

[MBS]

2. I agree that Obama has been handling this well.

Here's a thoughtful piece by David Remnick, who noted that, ultimately, both Merkel and Obama have handled the situation with "clarity and prudence":
http://www.newyorker.com/talk/comment/2014/03/17/140317taco_talk_remnick

. . .The invasion demands condemnation: Ukraine is a sovereign state; it has been for a generation. Its cultural, linguistic, and historical affinities with Russia do not make it a Russian vassal. Putin’s pretext—that frightened masses of Russian-speakers in Crimea and eastern Ukraine were under physical threat from “fascists,” and were crying out for “fraternal assistance” from Russia—is a fiction generated by his intelligence services and propagated by Russian state television. (Pro-Russian Cossacks in Crimea are no less anti-Semitic than the racists among the Ukrainian nationalists—something you are not likely to learn on Channel One, in Moscow.)

Putin’s aggression took Western leaders—especially Barack Obama and Angela Merkel—too much by surprise, but they have acted since with clarity and prudence. The decision to forgo martial threats and to concentrate on strong economic sanctions and diplomatic exertions is, in a world of radically limited options, wise. But not all those most directly involved in this crisis evince an understanding of the complicated politics of Ukraine. . . .

[freshwest]

6. Yes limited options, well handled. n/t

[olddad56]

8. Bush would have supported Putin.

[Cha]

9. Thanks for the New Yorker piece on Obama and Merkel, MBS

[FrankFarmerMan]

3. Keep in mind that Russia's actions are largely symbolic. No country wants nuclear war.

The invasion of Crimera mostly involved sinking three ships to inhibit sea traffic and putting a bunch of boots on the ground. There has been no clear intent of hostility, just intimidation. Obama is correct that threatening force would be of little use. This situation can only be resolved through diplomacy.

[penultimate]

4. Has the lack of causalities been due to Russia's great restraint

or due to the Ukrainian military's restraint? Would have the Ukrainians been in the wrong if they fired upon the Russian troops?

[FrankFarmerMan]

5. No, I think the Ukranians have every right to fire on an invading force, as did the Iraqi army.

The restraint from Russia is because this action is intimidation, not particularly military. Should it escalate I have no doubt that both sides would shoot at will, but (despite our agreement that led to Ukraine giving up its nukes) the US and EU countries should not get involved. That would only lead to nuclear war. Putin is just blowing smoke out of his ass because he knows Russia can't compete with the conventional forces of the rest of the world. His only option is nukes and even he isn't stupid enough to use them.

[FrankFarmerMan]

12. As I said, it was largely symbolic. They want to control Crimea, for obvious reasons.

Military force is intimidating but it doesn't have to be actually used to achieve a goal.

[freshwest]

7. Agreed all. n/t

[Cha]

10. Thank you, geek.. Obama's MO..

President Obama has handled this very well, he's avoided taking precipitous action, and the payoff has been a united front against Russia.

Interesting that Merkel who after she talked to Putin.. said he was "out of touch with reality".. and, her opinion has evidently not changed. I remember there were people on here who were trying to parse what she said in order for him not to seem so delusional. So weird... the Putin protectors.. at any cost.

[jakeXT]

11. I wonder how much money the CDU's Konrad Adenauer Foundation has invested into Klitschko

While "regime change" is too strong a term for what Germany is seeking, it's not entirely off base. Merkel's center-right Christian Democratic Union (CDU) and the European People's Party (EPP), a family of European conservative parties, have chosen Klitschko as their de facto representative in Ukraine. His job is to unite and lead the opposition -- on the street, in parliament and, finally, in the 2015 presidential election. "Klitschko is our man," say senior EPP politicians, "he has a clear European agenda." And Merkel still has a score to settle with Putin.

Ally in the Chancellery

Much of the work happens behind the scenes. Klitschko's party, the Ukrainian Democratic Alliance for Reform (UDAR), formed in 2010, became an observer member of the EPP recently. EPP offices in Brussels and Budapest are training UDAR personnel for parliamentary work and providing support in the development of a nationwide party structure. The Konrad Adenauer Foundation, which is closely aligned with the CDU, also plays an important role, and Klitschko has expressly asked Merkel's advisors for help from the foundation. Four UDAR members of the Ukrainian parliament paid a visit to Berlin last week, where they met with German CDU lawmakers and officials from both the labor and justice ministries. For some time, the Adenauer Foundation has been preparing Ukrainian opposition politicians to assume responsibility in the context of a "dialogue program."

http://www.spiegel.de/international/europe/eu-grooms-boxer-vitali-klitschko-to-lead-ukraine-opposition-a-938079.html

[geek tragedy]

13. Russian stock market is up today, apparently the "massive damage"

did not go according to plan

[okaawhatever]

14. That's just because military action didn't take place. The sanctions are a problem for the longer

term. Economists have already revised estimates and are now predicting zero growth this year to a possible recession. Russia's stock market is already valued lower than the average for emerging markets. Less than half, actually.

"Russian equities have the cheapest valuations among 21 developing countries monitored by Bloomberg, with shares on the Micex trading at 4.6 times projected 12-month earnings, compared with a multiple of 10 for the MSCI Emerging Markets Index."

http://www.bloomberg.com/news/2014-03-17/russia-s-micex-snaps-4-days-of-declines-after-crimea-referendum.html

[geek tragedy]

15. from the article you posted to:

The consequences are way smaller than initially thought,” Kirill Yankovskiy, a director for equity sales at UralSib Securities in London, said by e-mail. “Chances are these aren’t all the sanctions, but for now we’re likely to price in a further bit of an improvement.”

Russia had economic issues before Crimea became an issue, to understate things.

Russia's big energy plutocrat just sunk several billion into assets in the EU. Doesn't seem like anyone is sweating outside the Ukraine.

[okaawhatever]

16. From today:

Russian government admits economy in crisis as Ukraine weighs

http://www.reuters.com/article/2014/03/17/us-russia-economy-crisis-idUSBREA2G0RF20140317

[liberalpragmatist]

17. My sense is they're trying to calibrate the sanctions

Two reasons:

(1) For them to be effective, there has to be coordination between the US and the EU, and given how many member states have close economic ties to Russia, there's a reluctance on the part of my of them to crack down hard. Hence, they're mostly targeting symbolic targets - people who are politically close to the Kremlin, but not the financial elite or Putin's core inner circle.

(2) There also seems to be some attempt to keep things from escalating. What Putin did in Crimea was grossly illegal, but the world can probably live with it if it stops there. Latter-day Putin seems like an especially difficult guy to handle, with much of his earlier pragmatism in foreign relations replaced by a deep cynicism towards the West and a belief in his own superiority and invincibility. The concern is that not responding is interpreted as weakness, and as a green light for further actions, but responding too heavily just reinforces his view that the West is out to get him, hence also justifying further actions.

I'm not sure they've got the balance right, but at least regarding pt. 2, the argument seems to be, slap them with some embarrassing but substantively modest sanctions right now, but threaten to ratchet them up if he makes moves towards actually invading Ukraine proper.