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Thursday, December 12, 2013

Small Slip, Big White Lie

Here is how historic falsehood is constructed. Just read Mykola Riabchuk:

"“Would anyone anywhere in the world be willing to take a truncheon in the head for the sake of a trade agreement with the United States?”, asks Tymothy Snyder acerbically in his article “A Way Out for Ukraine?” knowing the answer perfectly well.

Many Ukrainians, indeed, got truncheons in their heads in the past two weeks, as they were protesting on the streets of Kyiv against their government’s last-moment decision to abstain from signing the Association Agreement with the EU. Timothy Snyder is well aware that it is not the Agreement per se that mobilized the protesters but their hope for a “normal life in a normal country” which the agreement had envisaged and come to symbolize."

First of all, the government of Ukraine technically didn't "abstain" from signing, but postponed it. Even the EU Parliament's monitoring mission, not exactly an un-interested party in all this, says so, quite clearly. I really don't want to come across as splitting hairs, but abstaining and postponing are two different things. "Postponement" contains the implicit promise of a signing later. "Abstaining" doesn't. Could possibly signal a strategy that is slightly different than what is ascribed to it. Or not, who knows. And since this is about diplomacy--and since diplomacy is precisely about splitting hairs in this way--perhaps one might wish to pay attention to small details like this.

The breaking news at 1:30 pm EST on December 12, 2013, is that the EU and the government of Ukraine have agreed to "work out a road map on a deal" so that Ukraine can "sign" the agreement "soon". In other words, news of the death of the association agreement were greatly exaggerated. The reason for this, in my humble opinion, is that both the EU and the economic and political elites of Ukraine--described by Ivan Krastev as the "no-nonsense oligarchs who keep their eggs in at least two baskets"--have something to gain from such a deal. With the protests at EU-Dependence Square, the government might even be able to make it look like it considered the opinion of the Maidan. (The only group of people for whom the deal, in its latest released form, is bad news is the majority, the people of Ukraine--assuming, that is, that they want to live reasonably well and derive at least a modest benefit from the resources of their own economy (e.g., its quality soil, its military strategic location on the north shore of the Black Sea, its economic-strategic location between the EU and Russia, whatever has remained of its industries, etc.,) and not suffer the textbook consequences of trade-, finance-, investment- and technological dependency on its 40 times bigger and approximately 8 times wealthier neighbor. Given that the "alternative" is another neighbor, also considerably more powerful and perceptibly richer, for Ukraine, this is a perfect "lose-lose" situation. But I am repeating myself.) As EU Enlargement Commissioner Füle reports, now even Ukraine's financial crisis and the IMF has been brought in to pressure the government of Ukraine.

There is of course no question that the as-yet unsigned, perhaps-to-be-revised-or-tweaked-or-re-crafted agreement had come to symbolize something, and I have not doubt that that something has to do with what the protesters imagine as "normal life," as Mr Riabchuk puts it. What exactly it came to mean for others, e.g., the rest of Ukrainians, is unknown and, if you read Mr Riabchuk (or many other commentators, let me abstain from--or postpone? 8) --mentioning them all), apparently sort of irrelevant. 

In other words, the protesters are now standing for Ukraine as a whole. And that is a really important geopolitical accomplishment. That has been,  as I have argued it a good 10-15 years ago or so, the well known synecdochic "representational" pattern of the EU's enlargement process in general (as well as the "colored revolutions," etc.)  To what extent the crowds in the street actually reflect what "Ukrainians," at large, think, or even just what the majority think (as in a democracy) is completely unclear from this. In fact the main rhetorical purpose of this synecdoche is obscuring, making it more difficult to even ask that question. We shall probably never know. 

A corrupt government in a face-off with an emotionally fired-up, protesting crowd. Technically speaking, both are, more or less equally, un-accountable. At the very best, we see the pattern, described in the case of the post-state-socialist context, as well as elsewhere, as the well-known paradox of the creation of a democratic system of accountability via undemocratic and un-accountable means. There is something really sad about the fact that we are forced to observe the unfolding of more or less the same, sad and, from the perspective of social justice, fairness and, indeed, democracy, highly problematic, drama a full one generation after the collapse of state socialism. In fact, this might well be a signal that there is a little more going on here than surviving old authoritarian-state-socialist-nostalgic regimes vs. crowds with democratic desires. I'm not sure what it is, but there is more to it somehow.

The crowd may well succeed in overthrowing the government, who knows. --And what happens then? What will the "will of the people" say about power in a genuinely democratic Ukraine? Do we know that? Do we know that Ukraine's new, presumably democratically elected, future leaders will be more democratic, (even more pro-EU) and less corrupt than the current ones? Have we seen such a "clean" democracy at approximately 60% of the world mean GDP/cap? Is it possible to build a "western democracy" in a society that is burdened with the task of facing such basic need? I suspect that nobody really has any idea. This is absolutely not the fault the protesters--they do what protesters do: protest, demand, overthrow. Great.

But the intellectuals, the analysts, the pundits that have so easily slipped into a position of "supporting the people" without asking specifically who "the people" are and what they might want, let alone what they need--they ought to have a different perspective. It would be kind of nice if somebody could be cool-headed, realistic, etc. Somebody really needs to think about the future. Or, maybe I'm overrating the potential usefulness of analytical reasoning and dispassionate observation.

Finally, I would like to challenge the author, or anybody, really, to show where exactly (page number, paragraph, sentence, etc.) the draft association "agreement [with the EU] had envisaged" (my italics) "normal life in a normal country" for Ukraine. (I would even appreciate if he could spell out just what exactly he means by "envisaging.") Short of that, there is the slight but really annoying possibility that this apparently tiny slip becomes a big white lie (pun intended), hidden in the body of a fairly complex sentence of a pseudo-debate with a US historian, will turn out to be a colossal geopolitical deception, and a contribution to the destruction of not "just" the physical well-being and life of the protesters--which is apparently nobody's concern--but also the future of Ukraine.

Sunday, December 1, 2013

Terms of Ukraine's EU-Dependency

The main provisions of the EU-Ukraine Association Agreement are available online. (I find it amusing that, in the big hullabaloo about the drama of the refusal to sign and the protests, it does not seem to have occurred to anybody to actually look at it--at least I haven't found any analysis on the internet.)  These truly are just the "main provisions"--the full version is apparently 1500 pages long (and, as far as I know, unavailable online). Here are a few basic features of the condensed version, just so that we see what it is that the protests and the diplomatic wrangling are all about.

A key aspect of the agreement is establishment of something called the "Deep and Comprehensive Free Trade Area" (DCFTA). Everything is pretty much secondary to this. So, what is DCFTA, how would it work?

Tariffs are key tools in the hands of poorer and weaker economies in their relations with richer and more powerful ones. (That Ukraine is considerably poorer and weaker than the EU should be obvious. How much poorer and weaker? Well, according to Angus Maddison's estimates, at the latest time point for which he offers data (2008), the weight of the Ukrainian economy was approximately forty times less in terms of economic weight than the European Union. To see their trajectories between 1990 and 2008, along with Russia, click here.)

As the EU's own publication suggests, the business linkages between the EU and Ukraine are quite skewed already. Ukraine exports EUR 14.6 billion worth of goods to the EU and imports EUR 23.8 billion, producing a 9.2 billion trade imbalance. In the area of investment, the imbalance is outright grotesque: EUR 2 billion from Ukraine, EUR 23.8 billion from the EU to Ukraine (resulting in a fairly breathtaking, EUR 21.9 billion, imbalance). Given those figures, even without the DCFTA, the economic linkage structure between the EU and Ukraine offers itself as a textbook study in external trade and investment dependence.

The draft agreement is absolutely adamant that the key purpose of this exercise is removal of all remaining tariffs and other trade barriers for EU capital:

"The DCFTA, linked to the broader process of legislative approximation will contribute to further economic integration with the European Union’s Internal Market. This includes the elimination of almost all tariffs and barriers in the area of trade in goods, the provision of services, and the flow of investments (especially in the energy sector). Once Ukraine has taken over the relevant EU acquis, the EU will grant market access for example in areas such as public procurement or industrial goods" (p.3.)

The expected benefit of the removal of "almost all tariffs and barriers" is that "The DCFTA once in force will provide tariff cuts which will allow the economic operators of both sides to save around 750 millions euros per year in average (most of the customs duties being lifted)" (p.4.)

Given the disparities between the two would-be contracting entities (1.5 to 1 in trade, 11 to 1 in investment and 40 to 1 in economic power), it is not difficult to imagine what percentage of that EUR 750M, resulting from the lifting of trade barriers, would go to the EU and what part will go to Ukraine.

But that is, really, small change compared to the liberalization of investment. In addition to liberalizing trade, the DCFTA also envisages a significantly more open investment "climate." This is so much so that the agreement not only emphasizes investment, but even specifies what it has in mind: "investments (especially in the energy sector)" (p.3.) Just in case this was not clear enough, the document repeats, "New trade and investment opportunities will be created and competition will be stimulated" (p. 4.). But it's not over: "Through the Neighbourhood Investment Facility (NIF), to which Ukraine is eligible IFI investments could be leveraged. The NIF aims at mobilising additional funding to cover the investment needs of Ukraine for infrastructures in sectors such as transport, energy, the environment and social issues (e.g. construction of schools or hospitals)." This is all very nice, except there is absolutely no mention of the terms under which all this investment in human infrastructure would take place, who would do them, from what funds, etc. None of that.

The draft agreement also envisages that Ukraine will gradually "approximate" the acquis communautaire, i.e., the EU's body of laws and regulations. This is an apparently completely neutral and technical provision. However, beyond the technical and the apparent neutrality, there are two key points to be remembered here.

First, clearly, the diplomatic frame of the draft agreement (two contracting parties come to an agreement) is highly deceptive: What is actually going on is the full adoption of a set of external legal materials by a smaller, economically weaker, actor, under political pressure by a bigger, economically stronger and politically superordinate party. I have analyzed the structure of such a grossly asymmetrical relationship in my paper, "The Fox and the Raven. . .", available here or here with respect to Hungary's EU-accession negotiations 15 years ago. (The only caveat is that that paper focussed on a situation in which Hungary, a much smaller but considerably wealthier society than Ukraine, played the subordinate role; the case of Ukraine today is somewhat different than Hungary 15 years ago, for two additional reasons: Hungary had no other "suitor" while Ukraine is in the midst of a geopolitical tug-of-war between the EU and Russia; and, at the time when Hungary was negotiating its EU-membership, there were no previous east European entrants, today's EU includes 11 former-state-socialist east European member states, offering an ample list of precedents and an entirely different political climate.)

Second, keep in mind: In a fairly fundamental way, the main (some would probably say, the only) purpose of the EU's community laws and regulations is removal of all the institutional mechanisms that the EU's member states had developed over the centuries for the protection of their internal economies from exogenous crises, unfair competition and unforeseen fluctuations of all kinds. So, when we see a reference to adoption (or, as in the case of Ukraine, "approximation") of the acquis communautaire, we need to remember that the acquis is, by definition, a neoliberal tool, designed to increase the global sway of transnational capital based in western Europe. That's what it is, no less, no more.

Finally, there is the question of what EU-parlance calls (from a sociological perspective, quite imprecisely,) 'mobility' (i.e., the freedom of movement for not just goods, services and investment, but also of people, including the right to settle, to work, to study and to participate in democratic political life without exclusion or diminution). This is important for three reasons. First, it goes to showing the depth of the EU's commitment to embracing Ukraine as a society, not just an economic area; second, it is a deeply emotional expectation, very much on the minds of all people, especially east Europeans outside the EU, and, third, it is at this point that the EU-Ukraine rapprochement runs into the hard realities of west European quasi-racism vis-a-vis east Europeans, something I have called, in a paper entitled "Goodness Is Elsewhere. . .", the rule of European difference (available here or here, see esp. pp. 125-134).

To put it bluntly, the draft agreement is extremely vague about movement of Ukrainians in Schengen-land. Savor this language: "The importance of the introduction of a visa free travel regime for the citizens of Ukraine in due course, provided that the conditions for well-managed and secure mobility are in place is recognised in the Agreement." (pp. 1-2.) And, again: "The EU and Ukraine commit through the Association Agreement to increase their dialogue and cooperation on migration, asylum and border management. The importance of the introduction of a visa free travel regime for the citizens of Ukraine in due course, provided that the conditions for well-managed and secure mobility are in place is recognised in the Agreement" (p. 3.)

In other words, there is absolutely no commitment on part of the European Union, or its Schengen common migration management system. Even the visa requirement, currently in place, will not be lifted for a while. When exactly? Well, "in due course." This is the absolutely vaguest diplomatic language. It binds the EU to nothing, not even to easing the visa requirement, let alone abolishing it (which would allow citizens of Ukraine to travel to Europe as they please) let alone the right to stay, study, or work there. Absolutely none of that is mentioned here.

People familiar with the EU-"enlargement" process will, no doubt, point out that that--i.e., free movement of persons, the right to settle, work, etc.--will come later, with (actually, usually seven or so years after) full membership. So, that brings us to the question, what about it? What does the agreement say about full membership?

Here it is: 0.

The word "membership" appears in the document once, referring to WTO membership. This should be absolutely clear: Ukraine will not be a member of the European Union; not in the foreseeable future.

So, when the people of Ukraine are animated by the ideas of democracy, citizenship, equality, etc., and demand that their government immediately accept the agreement--this is what they are demanding. Significantly increased exposure of their economy to capital from a forty times bigger and much richer economic area; demolition of the tariff barriers that might prevent the full siphoning-off of their resources, and absolutely no promise of equality, citizenship, democracy, or even an increased freedom of movement.

cover page of the book

cover page of the book
image used for the cover design by Anannya Dasgupta