Welcome to the 19th Century; Putin and the new Bonapartes see a weak and retreating West

Welcome to the 19th Century

Putin and the new Bonapartes see a weak and retreating West.

March 16, 2014 6:41 p.m. ET

‘You just don’t in the 21st century behave in 19th century fashion by invading another country on completely trumped up pretext,” declared John Kerry on March 2 as Russia began its conquest of Ukraine’s Crimean peninsula. Though he didn’t intend it, the U.S. Secretary of State was summing up the difference between the current leaders of the West who inhabit a fantasy world of international rules and the hard men of the Kremlin who understand the language of power. The 19th-century men are winning.

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Vladimir Putin consolidated his hold on Crimea Sunday by forcing a referendum with only two choices. Residents of the Ukrainian region could vote either to join Russia immediately or to do so eventually. The result was a foregone conclusion, midwifed by Russian troops and anti-Ukraine propaganda. Russia’s Foreign Minister Sergei Lavrov dismissed Mr. Kerry’s pleas for restraint on Friday in London, and Russia vetoed a U.N. Security Council resolution denouncing the Crimean takeover a day later.

Next up for conquest may be eastern Ukraine. Russian troops are massed on the border, and on Saturday its soldiers and helicopter gunships crossed from Crimea and occupied a natural gas plant on the Ukrainian mainland. Scuffles and demonstrations in the eastern Ukrainian cities of Donetsk and Kharkiv, egged on by Russian agitators, could create another “trumped up pretext.”

And what is to stop Mr. Putin? In the two weeks since Russian troops occupied Crimea, President Obama and Europe have done little but threaten “consequences” that Mr. Putin has little reason to take seriously.

The U.S. has refused Ukraine’s request for urgent military aid, and it has merely sent a few NATO planes to the Baltic states and Poland. The Russian strongman might figure he’s better off seizing more territory now and forcing the West to accept his facts on the ground. All the more so given that his domestic popularity is soaring as he seeks to revive the 19th-century Russian empire.

Left in shambles are the illusions of Mr. Obama and his fellow liberal internationalists. They arrived at the White House proclaiming that the days of U.S. leadership had to yield to a new collective security enforced by “the international community.” The U.N. would be the vanguard of this new 21st-century order, and “international law” and arms-control treaties would define its rules.

Thus Mr. Obama’s initial response to Mr. Putin’s Crimean invasion was to declare, like Mr. Kerry, that it is “illegal” because it violates “the Ukrainian constitution and international law.” As if Mr. Putin cares.

The 19th-century men understand that what defines international order is the cold logic of political will and military power. With American power in retreat, the revanchists have moved to fill the vacuum with a new world disorder.

Backed by Iran and Russia, Bashar Assad is advancing in Syria and may soon crush the opposition. Iran is arming the terrorist militias to the north and south of Israel. China is pressing its regional territorial claims and building its military. And Mr. Putin is blowing apart post-Cold War norms by carving up foreign countries when he feels he can.

The question now is whether Mr. Obama and his advisers will shed their 21st-century fantasies and push back against the new Bonapartes. Jimmy Carter finally awoke after the Soviets invaded Afghanistan, but Mr. Obama hasn’t shown the same awareness of what is happening on his watch.

We’ve written about the need for broad economic and financial sanctions against Russia and its elites. Skeptics reply that Europe will never go along. Even if that’s true—and that would mean a failure of U.S. diplomacy—it shouldn’t deter the U.S. from imposing its own banking and financial sanctions. The world’s banks can be made to face a choice between doing business with Russia or doing business in America. We know from the Bush Administration’s experience with North Korea that such sanctions bite.

The West must also meet Mr. Putin’s military aggression with a renewed military deterrent. This does not mean a strike on Russia or invading Crimea. It should mean offering military aid to Ukraine to raise the price of further Russian intervention. Above all it means reinforcing NATO to show Mr. Putin that invading a treaty ally would lead to war.

The U.S. and Europe should move quickly to forward deploy forces to Poland, the Baltic states and other front-line NATO nations. This should include troops in addition to planes and armor. Reviving an updated version of the Bush-era missile defense installation in Eastern Europe is also warranted, including advanced interceptors that could eventually be used against Russian ICBMs.

Russia’s revanchism should also finally awaken Europeans to spend more on their own defense. The 19th-century men know that nationalism isn’t dead as a mobilizing political force. Western Europe’s leaders will have to relearn this reality or their dreams of European peace will be shattered. They need more modern arms of their own in addition to America’s through NATO.

In response to the Crimean referendum Sunday, the White House issued a statement declaring that, “In this century, we are long past the days when the international community will stand quietly by while one country forcibly seizes the territory of another.” We shall see, but Mr. Obama first needs to understand that America’s adversaries reject his fanciful 21st-century rules.

 

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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