Tag Archives: Russia

Under-defended UK?

JR Max Wheel

3 March 2014


The standoff in the Ukraine, which may well have turned into something a great deal more serious if Russia pursues its sphere of interest policies to annexe parts of the country, once again shows total short-sightedness of European defence and foreign policy. If the EU is to mean anything in an increasingly dangerous world, it needs the capability to act and to project its power decisively. NATO is a post WWII construct whereby the EU has largely sheltered under a US nuclear and defence umbrella. The rapid decline in UK capabilities is even more alarming, the Strategic Security & Defence Review of 2010, whilst written in the light of austerity politics is now an irrelevance, it urgently needs updating and defence spend needs to rise to provide the UK with a credible force. This is not an argument for war-mongering, but it is a recognition that both men and materiel have been cut down to dangerous levels: equally the nature of conflict described in the document has been proved to de-emphasise state on state conflicts, yet that is still a threat, as we can see.


Despite admitting overstretch in the Iraq and Afghan conflicts, we have opted to reduce the regular army to 80,000 and to use territorials as substitute front line troops, this is blatantly inadequate. So is the reliance on a single aircraft carrier and the decision to decommission Harriers before a much delayed US alternative Joint Strike Fighter is ready;  it is late, wildly over budget and there are serious questions of its capabilities. Reduction in frigate capacity by four and decommissioning of aging HMS Illustrious and Ocean is also weakening naval capacity. Failure to ensure inter-interoperability of the carrier with European allies is  a major strategic mistake,

Britain is dependent on US C17 aircraft and a delayed over-budget A400M European built plane for air support transport. Eurofighter Typhoon orders were cut back effectively depriving the RAF of both adequate air superiority capabilities and theTornado is now obsolete. The Sentinel airborne battlefield surveillance aircraft is due to be retired and there is no replacement in sight. The RAF has been emasculated as a fighting force in most of its roles.

The Navy which retains its Trident nuclear capability and its hunter killer submarines has the major strategic weapons capability. Delivery systems however are also aging Vanguard class submarines and with reduced capability i.e.configured with half the firing tubes compared to the original design capability.

It is little wonder that Russia brushed aside the UK as being of little consequence any more. It is true it isn’t: this is not to denigrate the quality of fighting troops but the woeful lack of quality transport equipment and helicopters was evident in the Iraq and Afghan deployments.


This review was an accountancy exercise and not a sober military assessment and is urgently in need of revisiting. There is little doubt that cyber attack and remote-controlled vehicles will be a major part of any future strategy, but the flawed assumption behind this limp and flawed review was to underestimate good old-fashioned threats to national security can come in both traditional forms as well as via conflict that requires a low-level, rapid deployment force. Expenditure on Defence is rarely a popular choice, but it is nevertheless essential as is a credible European capability. It is after all the first not the last duty of Government to keep its citizens secure, current policy fails on nearly any measure.


Ukraine & Russia- an ugly embrace

JR Max Wheel

3 March 2014


History is littered with misjudgments which have proved disastrous. The current crisis in the Ukraine is a classic case of misreading the collapse of the Soviet Union as signalling an end to Russian ambitions. It is unfashionable to refer to “spheres of influence”, as if national interests do not matter. They do and especially when the world view of a Russian leadership is to extend its influence to a Eurasian trade area, a sort of bastardized counterpoint to the EU. This is not an innocent project but a power play by a leader who considers that the 1991 collapse of the USSR to be the singular disaster of the 20th C. This suggests a complete absence of perspective and motivated only by the imperative to rebuild it, made easier by the descent into chaotic governance in the Yeltsin years stability at almost any price was deemed better than the unpaid bills and pensions, systematic looting of national assets and a sense of national pride restored.

The Ukrainian revolution threatened to put a massive dent in this policy and therefore had to be resisted. It is also too close and too important to be the plaything of any other power, the means of transit of Russian gas via three major pipelines to the West as well as the historic breadbasket and stuffed with ethnic Russians, predominantly in the South and East as well as Turkic speaking Tatars.

The Ukraine despite its origins as the home of the “Russes” and founded by Scandinavian settlers has few natural borders: it is a mish-mash of religions, linguistic differences and has been conquered by Russians under Catherine the Great and dismembered after the Versailles treaty, where a large part of Western Ukraine was Polish territory. The unhappy interwar history of this productive agrarian country is symbolized by the brutal collectivization of its agriculture, commemorated by the Holomodor, a monument to death, destruction and repression, that is utterly stifling in its horror, black tomes listing the dead, lit by tall wax candles and surrounded by stark black and white imagery: it is very hard to keep a grip on ones emotions in this place and a relief to break free and ring the massive silver bell which hangs over the exit, overlooking the Dnieper River. No surprise that Nikita Khrushchev in a belated gesture gave the Crimea to Ukraine, was this some recognition of  dire wrongs committed or a cynical ploy that Russia could always walk back in?

It is doubtful that the Maidan protestors form an entirely innocent democratic group, or that  Russians have no legitimate interests in the country and its people(s), but that is not to excuse the land grab at Crimea or worse. The ill-fated Orange revolution neither delivered good government or deep reforms, the country experienced the same post Communist asset grab that threatened Russia.

What is important is that the youth and future of the country do not accept a stifling, corrupt and authoritarian regime, where puppet Presidents like Yanukovich can be controlled from the Kremlin.

Equally the EU has played its hand badly by offering and withdrawing a free trade deal without any consideration of Russia’s historical connections. This was diplomatically and politically inept as is the notion that Ukraine could join NATO, the latter touches on the Russian paranoia of being encircled and threatened. Putin holds most of the immediately valuable cards, a strong Army, a naval base in the Crimea, threats to Western energy supplies, but in the longer term the demands of the people for a better, freer life will wreck any grand Tsarist illusions: that is something which must not be repressed.


UK. Decline & Fall

JR Max Wheel

3rd. September 2013

The shock defeat of the UK Government’s Commons motion to intervene in Syria seems to have unnerved the political classes in the UK and the US. In its watered down format, it was not even seeking explicit approval to act. Public sentiment is against involvement as it is largely in the US and much of the EU. Any action is mainly symbolic, the supposed upholding of international law against a regime that appears to have little or nil restraint, although evidence, as always in war zones, is not conclusive. This is again ultimately a judgement call, The UN inspection regime is positively glacial and its leadership seems to have little urgency or guidance, nor will it do more than confirm the use of chemical weapons, without attribution as to who used them, which explains the impatience in the US. Another impending tragedy is the mass displacement of Syrian people, now estimated to be over 2m and more within its borders. Where is the UN urgency in driving a resolution to this regional mess, whether in Jordan, Lebanon or Iraq?

None of this standoff should actually be a surprise, as these issues stretch way back beyond the second Iraq War, Afghanistan and Britain’s now exhausted military, hobbled by poor long-term decision-taking and budget cuts. The historical trail leads at least back to the Great War settlement of Versailles, when the dismemberment of the Ottoman Empire produced a plethora of double-dealing and confusion, especially from the French and British, all overseen by a still naive United States. As with many bad deals worked out by the “Great Powers” Versailles provided a succession of them in the Middle East, whose malign consequences are alive and well today. Palestine, the foundation of Israel, the frustrated cause of Arab nationalism and the division of Syria into pieces, part Lebanon, part Jordan and part old Syria. Its borders were arbitrary and its citizens an unholy mix of Druze, Alawite, Sunni, Shia, Christians and Jews. The Ba’ath party itself, a messy concoction of pan-Arabism and socialist and secular ideals flourished in both Iraq and Syria, but its idealism became rapidly splintered into factionalism. Unsurprisingly in the collapse of the United Arab Republic between Egypt and Syria, power passed to the Army in 1963 and then finally with the Assad coup of 1970, the rise of a tyrant, enshrining the new regime in a near one party State.  Syria under Assad Senior was a formidable and brutal mix of repression, nepotism and corruption, with the army involved in all aspects of Syrian life.

Much as in Iraq, the power vacuum resulting from removal of a demagogue creates the ideal conditions for the spree of reprisal killing and sectarian violence that marked the toppling of Saddam Hussein; a similar fate is equally likely in any post war Syria. The Assad dynasty aided and abetted by Russia, by supply of modern firepower is a cynical regional power ploy with Putin playing the same game of Great Power politics. Throw into this heady mix, regional meddling by the Iranian theocracy, an international extreme jihadist movement spread through the Maghreb, Yemen and beyond and it is easy to see why this is such an intractable and toxic brew. Trying to impose principles of international law or even curtailing the Syrian Government’s capability to inflict further misery on its people is a triumph of hope over experience. Whatever the “West” does will always have echoes of an imperialist past. Trying to bomb dictatorships to the negotiating table does not have a great record of success anywhere. The regional powers lined up are also in anything but their more normal configuration. Thus while Egypt has abstained; Turkey, Israel, most of the Emirates and Saudi Arabia are aligned against Assad, whilst Lebanon, Jordan, Iran and Qatar are against direct action.

Britain has seemingly now decided that it will not act, despite French agreement to do so. Whilst unusual, it may represent a more realistic assessment of our actual military capabilities as well as a more thoughtful approach to what happens next.  Whether or not the US and allies succeed in gaining any meaningful advantage from a proposed degrading of Syria’s capacity for war is disputed even by many in the US military, who rail at the naivety of more political posturing. Shades of 1919, a proxy regional war led by superpowers, couched  in the specious name of upholding a worthy principle, but likely to bring anything but peace.

Cyprus & the Eurozone – the dominos wobble

JR Max Wheel

25 March 2013

This is a bad deal for Cyprus and a worse one for the Eurozone. The arguments for and against have been pretty well rehearsed by now, but this latest fix is likely to come unglued more rapidly and directly poses the threat of an exit. If you can exit the € then all bets on the € system continuing are off and this may happen much quicker than EZ leaders imagine. It is ludicrous to maintain that because the Cypriot economy accounts for a mere 0.2% of EZ GDP that it is unimportant to the whole. Contagion and capital flight once started are virtually impossible to contain.

Every mistake in the book has been committed with Cyprus and of course, it is not the first domino, it is a direct consequence of the Greek deal, and a grotesquely large banking sector, fuelled by external fund flows seeking an internal EU tax haven, and not just Russian money.

First mistake was clearly the attempt to “tax” the bank deposits. This is not solely a Cypriot problem but the price demanded for a bailout by the EZ as a contribution of nearly €6bn. to the total bail out numbers agreed by the EZ leadership. When your economy is dominated by a banking sector, so large it was always going to be the easy and maybe the only initial target in a rapidly deteriorating problem. This breaks with the EZ wide deposit insurance scheme and by hitting all depositors was always going to be a problem. So tweaks were made to initially soften and then finally remove all deposits below the deposit insurance threshold of €100,000.

Second mistake, the Cypriot economy did not suddenly acquire such massive deposits they have been built up over years and no one has done anything to resolve this issue, so at least some care was necessary at EZ level to ensure some sensible interim arrangements to avoid capsizing the system.

Third mistake; trying to pass the buck to the Russians, in the expectation that a new deal could be struck with them on top of the €2.5bn loan made to the island in 2011 could be re-negotiated and increased.

From a geo-political standpoint, this looked a seductive option, the prospect of a naval base, access to newly discovered gas reserves offshore, protection for some major Russian depositors, presumably those that were most friendly to the Kremlin. Unfortunately, the Russians have a large captive market for energy in the EU and were unlikely to stir up a hornet’s nest with either the EU or NATO, in respect of British bases.

This drove the Cyprus Government back for 11the hour talks to resolve the issue any old how. Thus, we see a massive levy on larger than €100,000 deposits many of which are of course those of Cypriot business. The largest banks are forced into a restructure, with one of them, Laiki, to close and direct its duff loans to the rubbish dump of a “bad bank”, a bit like the Irish NAMA. When you extract 25% or more of the wealth held in the banking system or as has been argued that a “haircut” could be as much as 40%, this will plunge the Cypriot economy into a deep depression. This is exactly the territory, where you question whether being a member of this € club is either desirable or necessary. Re-introducing the Cyprus pound suddenly looks extremely attractive.

This brings us to a Fourth mistake- underestimating contagion. The casual approach to this beggars belief. If one country can leave, then theoretically any can. The stagnation across Portugal, Spain and Italy, massive under and un-employment and increasingly slowing Northern European economies will spawn and encourage powerful populist agendas. Far from bringing together countries in a political and economic union, the perverse effect is to drive them apart. This is what the € standard has brought about. It was always said to be a political project and not an economic one- that is as may be but the best of political intentions will crack and splinter against the rocks of economic reality.