A corrupt oligarchical state, riven with factions with irreconcilable differences, led by a comedian. Its economy in tatters, a deceitful media, trade with its greatest partner cut off, a rising far right – fuelled by hatred of “the other”, its institutions broken. No, I’m not describing the UK, but the Ukraine. However the parallels are startling.
Dmitry Orlov has often noted the way the former Soviet Union collapsed would be visited on the USA, but Britain is modelling the route to failed statedom exceptionally well. Blogger Selco Begovic, who survived a year in a Balkan city under siege, said he realised that fighting over statues indicated the start of the implosion of Yugoslavia.
Before 2016 you would have laughed at me for writing this. Look at what Bloomberg (those commies!) is pointing out in its analysis of economic tribulations on the way from Brexit.
Here’s How a No-Deal Brexit Would Shock Virus-Hit U.K. Companies .
Professor Richard Murphy posted on Tax Research UK: “We are, at present, in the very early stages of the worst recession that this country will have seen for almost a century. No one who will have any responsibility for managing it will have ever witnessed anything like it before. We might have unemployment of 20% or more. Maybe one-third of UK businesses might go bankrupt. Without government intervention the prospects of massive hardship, including life-threatening hunger, are very real.”
Jonathan Freedland in the Guardian outlines further damage from Brexit.
The Ukraine – A Warning from History
At the end of the Soviet period, the Ukraine was a fully-developed economy, with heavy industry, shipbuilding, motor industry, mining, excellent agriculture, an aerospace and military sector, with a well-educated populace, free healthcare and housing, and seemingly excellent prospects as an independent post-USSR country. Between 2000 and 2020 the Ukraine economy shuddered, some years shrinking by up to 9% per annum; millions of valuable workers left to find jobs elsewhere, the deindustrialised country divided into two camps, one implacably anti-Russian, the other seeing the Russians as their Slavic big brother and friend. Oligarchs ripped off everything they could privatise. A Western-backed fascist coup in 2014 overthrew the elected leader, who fled. The IMF/WTO structural adjustment policies mandated privatisation and austerity. Two important provinces broke away and the attempt to bring them back by force bloodily failed. The Crimean area elected to return to Russia, further damaging Ukraine’s economy with the loss of a major port, tourist industry and foreign currency influx. Ukraine is a basket-case country that is close to becoming a failed state, and is only held up by unpayable IMF loans. “Ukraine has gone from a major industrialized powerhouse to a fourth world backwater with no foreseeable future.” Head of the Ukrainian Institute of Political Analysis and Management, Ruslan Bortnik, a notable expert, says, “The coronavirus and the economic crisis it has caused have brought the Ukrainian economy to the brink of survival, pushing Ukraine towards financial collapse.”
The important factor to note is the destruction of Ukrainian industry fuelled the nascent fascism – not the other way round. Xenophobic politicians roused the masses with racist rhetoric. Angry, unemployed people needed a scapegoat – the oligarch-owned media aimed them at the “Evil Russians,” instead of the 1% who were actually looting the country. The rightists cut off trade with the country’s major trading partner – Russia, which caused disastrous economic damage. Pensions have been frozen at 2014 levels and wages have fallen and prices risen everywhere except the Crimea – where wages have gone up.
Ukraine is now the poorest country in Europe, with a per capita income equivalent to Angola.
Does any of this sound rather familiar?
It is a Warning from History, about what happens when you deindustrialise a nation.
The UK government’s actions since the Brexit vote, and the Neoliberalism that preceded it have pushed the four countries that comprise it towards economic collapse and breakup.
Like Ukraine – the UK is a blatantly corrupt country where oligarchs can get away with anything, and are never punished.
Financial corruption is rampant in both countries. Taxes are optional for the 1% and government money is siphoned off for cronies.
Like UK, the Ukraine political class are incompetent and insulated from the disasters they cause.
The media is politicised and right-wing. All ten of the most popular TV-channels are oligarch-owned. “Ukraine’s [former] President Petro Poroshenko owns news TV channel 5 Channel and allegedly controls a recently created news TV channel Priamyi (Direct), whose editorial policy is openly pro-presidential. Indirect involvement means that a media owner supports certain politicians and/or political parties. A good example for this is Rinat Akhmetov, the richest person in the country. His media group Ukrayina (Ukraine), which co
nsists of several TV channels, a newspaper and a website, gives a lot of coverage and air time to various politicians and parties. As there will be both presidential and parliamentary elections in 2019, the political influence on media is at the highest point in recent years.” medialandscapes.org
Like Ukraine, the UK has deindustrialised. Unemployment in Ukraine is said to be 8.88% on official figures but other analysts have put it as high as 25%. This will be coming to Britain post COVID and Brexit.
Both countries have had a fascist resurgence. Hate speech and physical and lawfare attacks on religious communities and LBGT+ people are stirred up by the rightwing and politicians.
Both countries media rely on scapegoating minorities to channel the peoples’ righteous anger away from the real issues. Ukraine has long had a problem with anti-semitism, and Polish, Hungarian and Russian ethnics are demonised.
Both countries’ militaries have proved to be paper tigers.
While the Ukraine constantly shells the breakaway areas, committing war crimes, it dares not attack them. The Donetsk and Lughansk militias, backed by Russia, beat back the attacks by the regime’s forces. The Ukraine can’t even manufacture or repair its own tanks, despite designing an upgrade of the Soviet Union’s most advanced tank (T80). Conscripts desert, refuse to fight or vanish when called-up. Even fascist “hard cases” have decided they prefer living to coming home heroically in a body bag. Spending record amounts on the military budget (2018 3.78% of GDP) does not help rebuild the civilian economy.
The British army was defeated in Basra and Helmand Province by local militias. It is equipped with a lot of obsolescent equipment, not fit for the modern battleground. The Royal Navy and the Air Force are in even worse condition, buying the F35 – probably the worst fighter plane ever designed, and so expensive it precludes getting anything better. Neither it or the absurd aircraftless aircraft carriers will ever be deployed in a battlezone because they will be shown to be the junk they are.
Cutting off trade with Russia, it’s greatest trading partner, proved to be a devastating decision by the Ukraine political class, essentially no-platforming the economy. Russia is big enough to find other suppliers while Ukraine isn’t. Trade with the EU has not replaced the losses to Russia and other CIS countries.
The Ukraine’s Agricultural Miracle
It is worth examining the one particular difference with the UK – agriculture. The Ukraine has excellent arable land (Black Soil or “chernozem”) and usually exports surplus food and other valuable products such as wine, cider, flowers, honey – if it was a normal country, this would be keeping the economy afloat.
Unfortunately this sector has also collapsed, sometimes the Ukraine has had to import food, at high prices, further sending the economy spinning downward. The key point is that agricultural workers can move to nearby countries, get better pay, in more stable currencies which can be sent back home. A not-inconsiderable bonus is they won’t get literally pressganged off the streets and be forced to kill their fellow citizens. Deindustrialisation is again a factor: Ukraine has insufficient working tractors and fertilisers/pesticides. The government is failing to support small and medium farmers – possibly deliberately so their holdings can be privatised. Foreign investors are snapping up the best companies in this sector. In 2018 Saudi Arabia bought the largest Ukrainian agricultural company in an opaque deal. Record harvests make the balance sheet look good in some years, but that is a factor of weather, not good government.
The Roots of Collapse
The Fund for Peace, which has been working on such issues for more than 70 years, lists four criteria to identify a failing state:
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Loss of control of its territory, or of the monopoly on the legitimate use of physical force therein
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Erosion of legitimate authority to make collective decisions
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Inability to provide public services
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Inability to interact with other states as a full member of the international community
Ukraine is further down the road to a failed state than the UK. However the parallels are quite striking: the deindustrialisation of the economy; the unforced error by the political class of cutting off trade with Russia and the other CIS nations; the way the oligarchy profits from the chaos it has caused. Similarly to mosques in the UK, the churches and congregations of the (Russia-oriented) Ukrainian Orthodox Church (UOC) are visible and easy targets for right-wing thugs.
Lughansk, Donetsk and the Crimean peninsula were major drivers of the Ukraine economy. Their leaving battered it more. Likewise Scotland is a significant contributor to Britain’s economy – the figures that claim it is not are basically fictional. When it becomes independent the UK will take another downward lurch. Pressures to reunify Ireland will only increase, and the younger generations are far less enmeshed in sectarianism than their elders.
A brutal Brexit on top of COVID-19 will come as a massive shock to the economy, further discrediting the political/media class. It is hard to see any positives in the direction Britain is heading, in the same way it is difficult to envision Ukraine recovering its former cohesion and development. Those who ignore warnings from history are likely to suffer serious consequences.