Thoughts on Ukraine, Part 2: Kleptocracy, Not Patriotism or Shared Nationality

Thoughts on Ukraine, Part 2: Kleptocracy, Not Patriotism or Shared Nationality

Figure Ukraine Resource Map (

Part 1 discussed some of Putin’s potential objectives in Ukraine but left the question open. Perhaps his reaction on 27 February to the SWIFT action clarified his objectives. He swiftly placed Russia’s nuclear arsenal on high alert. Hitting in his wealth got his attention and invoked his wrath. The prior Treasury announcement did not ruffle his feathers. The US gave him thirty days to accomplish his objectives in Ukraine. But with the thirty-day window looking shorter all the time, the new financial penalties got to him. Truth be told; however, it is not the first time he said changes to SWIFT that exclude Russia are an act of war. He said that back in 2014, when he separated Crimea and two Donbas regions from Ukraine. The US backed down then and let the tyrant have his way.

When the wall fell, Russia plunged into a kleptocracy. Even military commanders started selling equipment to cash in. Cronies of the elites took control of assets and made fortunes. Perhaps Gazprom was the biggest kleptocratic prize of all. Interesting that Gazprom is front and center of this crisis. Gazprom owns Nord Stream 2, which the Germans shelved and owns most of the pipelines that transit Ukraine.

Looking at Ukraine from a different perspective may clarify Putin’s objectives. As Figure 1 shows, Ukraine has abundant resources. They are also the breadbasket of Europe and have a strong manufacturing sector. Ukraine is a kleptocrat’s dream come true. And if Russia loses parts of Siberia to the Chinese, it may be even more important.

Perhaps Putin’s real objective is to control these assets to continue to develop his personal wealth and to pay off his supporters. This resource basket could be far more secure than Siberia as well.

If only the Ukrainians willingly cooperated, as he seemed to expect.

They are not willingly cooperating and are actively fighting the Russians. And the Russians are showing some of the same problems that had in Georgia. Logistics vulnerabilities and potentially poor training and synchronization seem to plague Russian operations. The initial successes and short duration of the operations in Georgia let the Russians off the hook and allowed them to keep their prizes of two provinces in Georgia. But perhaps they did not learn, or at least could not effectively implement what they learned in Georgia. Now, Putin faces the prospect of prolonged operations and the specter of failure. That may be what is behind the continued calls for peace negotiations to salvage something from the adventure.

But the nuclear order is a big deal. Is it just posturing or is the man serious? Analysts fall on both sides of the argument. There are even some that think Putin may be insane. Part 1 discussed both the nuclear potential and a solution that takes out Putin and changes the regime, or at least the outward face of the regime.

I suspect there are those in Russia that are wondering whether Putin has outlived his usefulness. The potential danger of nuclear war would only heighten these musing. There may be quiet whispers among members of the FSB and Putin’s inner circle it is time for him to go. A regime change gives the Russians a face-saving way to get out of the crisis. They can claim Putin was insane, quietly put him away, and a new regime comes forward to negotiate with Ukraine and the west.

Kleptocrats want to ensure their survival and safeguard their wealth. Perhaps we need to factor kleptocracy into our assessments of Russia. The Russian organized crime is alive and well. It is active throughout the world.

The Center for Strategic and International Studies (CSIS) states, “The breadth and depth of Russian organized crime already runs so wide and deep, that Russia is on the verge of becoming a criminal syndicalist state, dominated by a lethal mix of gangsters, corrupt officials, and dubious businessmen.”

Putin may be the thug in chief as opposed to the commander in chief. While the FSB and others are certainly not angels, they may see the handwriting on the wall and realize it may be time to act to protect their wealth. The SWIFT action hits them all.

This may be the clear and present danger and not just Russian organized crime. The Mexican cartels and highly organized gangs from Central and South America, such as MS-13, threaten stability and peace. Russians and these cartels and gangs control significant areas of American cities and threaten our way of life.

Yet our southern border is wide open to them.


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