Ukraine Denouement » CounterPunch:

by MICHAEL HUDSON

The fate of Ukraine is now shifting from the military battlefield back to the arena that counts most: that of international finance. Kiev is broke, having depleted its foreign reserves on waging war that has destroyed its industrial export and coal mining capacity in the Donbass (especially vis-à-vis Russia, which normally has bought 38 percent of Ukraine’s exports). Deeply in debt (with €3 billion falling due on December 20 to Russia), Ukraine faces insolvency if the IMF and Europe do not release new loans next month to pay for new imports as well as Russian and foreign bondholders.

Finance Minister Natalia Yaresko announced on Friday that she hopes to see the money begin to flow in by early March.[1] But Ukraine must meet conditions that seem almost impossible: It must implement an honest budget and start reforming its corrupt oligarchs (who dominate in the Rada and control the bureaucracy), implement more austerity, abolish its environmental protection, and make its industry “attractive” to foreign investors to buy Ukraine’s land, natural resources, monopolies and other assets, presumably at distress prices in view of the country’s recent devastation.

Looming over the IMF loan is the military situation. On January 28, Christine Lagarde said that the IMF would not release more money as long as Ukraine remains at war. Cessation of fighting was to begin Sunday morning. But Right Sector leader Dmytro Yarosh announced that his private army and that of the Azov Battalion will ignore the Minsk agreement and fight against Russian-speakers. He remains a major force within the Rada.

How much of Ukraine’s budget will be spent on arms? Germany and France made it clear that they oppose further U.S. military adventurism in Ukraine, and also oppose NATO membership. But will Germany follow through on its threat to impose sanctions on Kiev in order to stop a renewal of the fighting? For the United States bringing Ukraine into NATO would be the coup de grace blocking creation of a Eurasian powerhouse integrating the Russian, German and other continental European economies.

The Obama administration is upping the ante and going for broke, hoping that Europe has no alternative but to keep acquiescing. But the strategy is threatening to backfire. Instead of making Russia “lose Europe,” the United States may have overplayed its hand so badly that one can now think about the opposite prospect. The Ukraine adventure turn out to be the first step in the United States losing Europe. It may end up splitting European economic interests away from NATO, if Russia can convince the world that the epoch of armed occupation of industrial nations is a thing of the past and hence no real military threat exists – except for Europe being caught in the middle of Cold War 2.0.

Complete story at - Ukraine Denouement » CounterPunch: Tells the Facts, Names the Names

Stop Me If You Think You've Heard This One Before

OK, so we all know what's going to happen next, right? Ukraine and the USA will (sneak around / break / defy / do what they want / walk all over) this agreement, and as the war continues, the USA, the EU, NATO, and Ukraine will all blame Russia because they're not controlling the separatists.   And that's even more true because Mr. Putin is one of the participants making the announcement.  Yep, stop me if you think you've heard this one before.

Ukraine SITREP October 14th, 00:45 UTC/Zulu: Dark clouds over Novorussia

Things decidedly do not look good right now. Poroshenko has replaced that clown Geletei with a bona fide war criminal Col. Gen. Stepan Poltorak, a far more dangerous and evil character who used to be the commander in chief of the junta’s death squads (aka “national guard”).

The fact that Poroshenko would appoint such an odious figure indicates that he is trying to appease the neo-Nazis who are demanding a full resumption of hostilities. Interestingly, just like Geletei, Poltorak is not a military man but a person who made his career in the Ministry of Internal Affairs from where he was picked to head the notorious “national guard”.

On the same day, Pavel Gubarev, the “people’s governor” of Donetsk was the victim of an attack on his vehicle. Even though he was not hit by bullets, he has suffered very serious head trauma as a result of the crash of his car. He is now in a hospital in Russia in very serious condition.

The list of potential candidates who had an interest in murdering Gubarev is long. First and foremost, I would list the Ukrainian oligarchs whose assets Gubarev had promised to seize then, of course, the junta and various Neo-Nazis. Next, I cannot exclude the possibilityt that Gubarev could have been targeted by his own, Novorussian, political enemies and, finally, I would not exclude that the attack could have come from those circles in Russia who would see him as an obstacle for their plans for Novorussia. Needless to say, the hurray-patriots will blame Putin. Regardless of who ordered this murder, the fact that Gubarev is in very serious condition in a Russian hospital is very bad news as this is bound to have an extremely polarizing and distruptive effect on the ungoing feud between various Novorussian leaders.

Finally, there are numerous reports of Ukrainian attack all along the line of demarcation, including artillery strikes on Donetsk. The front has no moved much, but we are fare away from the “days of silence” which had been announced (see map at link below).

Complete story at - Ukraine SITREP October 14th, 00:45 UTC/Zulu: Dark clouds over Novorussia

Profits Before Glory | SLAVYANGRAD.org

Judging by the fact that, on both sides of the front, the participants are scaling back their activity and preparing for winter (and that, on the Ukrainian side, conversations about the Army’s lack of readiness for wintering in the field are getting louder), it can be assumed that, after all, a decision has been made to wait until the spring. We no longer need to suspect the sides of some kind of clandestine intentions—it is getting colder and damper, and, while, of course, there could be fighting, it will be solely in the form of torpid skirmishes and sabotage behind enemy lines. The usual kind of positional war following a Verdun-esque meat grinder.

In a sense the Cunning Plan has prevailed. Kiev was not allowed to finish off Donetsk and Lugansk, and they were pulled back from the brink at the very last moment. The existence of the rebel territory remains a thorn in the chubby backside and carries the threat of the pain being drastically amplified in case of misconduct. On the rebel territory itself, by the looks of it, a classic sweep of disloyal elements and the transformation of the freemen into something like a controllable entity has begun.

The existing bedlam has its negative aspects—the proliferation of weapons has taken on quite a menacing form. Just today, two contract soldiers were caught trying to sell a hundred grenades in the Rostov region. One can hazard the guess that this was simply scraps from the master’s table of the mobile Voentorg shop. What is carried out of the shop by men with stars on their epaulettes is, of course, not reported to the general public; but, as always, in times like this the arms trade is brisk and not at all retail in nature. Pumping the border regions—already complicated in every respect—full of weapons can only be done at one’s own peril.

On the other hand, by swiftly and firmly reining in the offensive impulse of the reinvigorated Militia, Moscow has demonstrated its commitment to a partnership with Kiev. It does not in the least fancy losing a thirty billion cubic metre Ukrainian gas consumption market, and the fact that Yatsenyuk is threatening that in ten years Ukraine will become fully self-sufficient in this product only causes them to sniff disdainfully in the Gazprom offices—“we will see where Yatsenyuk himself will be in ten years.”

Complete story at - Profits Before Glory | SLAVYANGRAD.org

Could Kiev fail before the New Republics? | New Eastern Outlook

All is semi-quiet on the Ukraine front. Despite the OSCE spokesman who said on the first day that he did not think that the ceasefire could last, another OSCE guy with a fully working brain said there was a night and day difference from a week ago. That is how you build a peace… in steps.

Sure, Kiev does not have tight command control over the Right Sector and the Oligarch brigades, both of whom are fighting for their own reasons. Both are not really on board the whole Kiev train at all, but their own adapted warlord version of it. They serve Kiev to carve out a future stake in the spoils of their country, just like the Kiev coup-meisters are… and that is what made them pliable puppets for the West.

As the “anti-terror campaign progressed, it quickly became evident that Kiev never could have launched its punitive campaign without the help of both groups. But that was a recipe for division and disaster. The Ukrainian army condition was rundown, due to the poor economic state of the country. A pecking order developed right away over the competition for the best weapons (like in working order) and having dependable operational resupplies.

When the initial engagements were checkpoint battles, no real strain was being put on the fighting capabilities, or supply chain. But military units had been put into the field quickly to beat the rebels to the punch, and whatever needed supplies were missing, they got the famous age old lie, “we will send that along soon.” When unit A never got theirs, and then saw unit B did, the morale problems began to appear.

Kiev’s morale got worse after the rebels were able to raid and acquire the armor and heavier weapons from the regional armories. The days of the Ukraine troops in APCs punching through lightly-armed checkpoints were over. The rebel checkpoints evolved into being bait for several APC-size Kiev units, where they began to experience being ambushed from both sides of the road and their vehicles taking hits from a half dozen APGs. The war was really on.

Complete story at - Could Kiev fail before the New Republics? | New Eastern Outlook

The Ukraine - Entering the End Game - Alexander Mercouris

We have had an extraordinary succession of diplomatic move and counter move over the last two days.

1. Yesterday was the false announcement by Russian media agencies of supposed proposals by the NAF that would have allowed the DPR/LPR to remain if only nominally part of the Ukraine.

2. This morning we had the equally false announcement by Poroshenko's Secretariat that he had agreed a ceasefire with Putin.

3. This afternoon the Kremlin published its plan for a ceasefire. Whilst this purports to be limited to its technical aspects in reality it effectively gives the DPR/LPR what they have demanded all along and since before the ATO was launched, which is the removal of all Ukrainian forces from their territory. The Kremlin's ceasefire proposal throws in a no fly zone for good measure.

This flurry of announcements suggests moves in an end game, which is what I think we are looking at. So what is going on?

First of all it bears reiteration that none of this would be happening were it not for

1. The NAF's battlefield victories and the not so slow motion collapse of the Ukrainian army. Lugansk and Donetsk airports have now definitely fallen. The very latest reports suggest that Mariupol is totally surrounded and that Kiev has only the remnant of right wing militia battalions there and that it is likely to fall or be liberated by the NAF very soon. There are reports of more and more Ukrainian soldiers surrendering or deserting and the hoard of captured weapons in the NAF's hands is growing to prodigious levels. As the junta's military gets weaker the NAF grows stronger. Though Putin has said (echoing comments made a week ago by Zakharchenko - see below my discussion of his press conference on this Page) that the NAF has no plan to advance beyond the boundaries of the DPR/LPR, the main force of the Ukrainian army is now actually concentrated on the territory of the DPR/LPR. If the Ukrainian army disintegrates, which is now looking distinctly possible, it is not clear what organised military force the junta has left to bar an NAF advance on Kharkov, Odessa or even Kiev.

2. As I explained a few days ago (see below on this Page) the true story of the recent EU summit is that for all the talk of sanctions the US/EU has emphatically ruled out the one thing that might at the risk of a very dangerous escalation have made a difference to this situation. This was the possibility of western military intervention in the conflict to bail the junta out. Please note that by "western military intervention" I mean boots on the ground and air strikes. As Mark Sleboda has absolutely correctly pointed out talk of weapons being supplied to the junta is a red herring. The reality is the junta has been getting weapons for weeks from old Soviet stocks in eastern Europe and has never been short of weapons to fight this war.

Complete story at - The Ukraine - Entering the End Game - Alexander Mercouris