Britannia Radio

Whatever Russia is doing to itself it ain't 'arf upsetting the 
partners !  They're in a right tizzy (as we would be in the same 
circumstances )

Don't feel left out for  we are going to run out of electricity and 
it will all be our own fault!

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EUREFERENDUM Blog        16.1.09
  "Impotence"


What a lovely word . when applied to that dreadful organisation, the 
European Union. One takes the International Herald Tribune to be a 
soft Europhile paper, if you will excuse the pun, and when it starts 
using that word in relation to the EU, it cannot help but bring a smile.

More than a week after the EU put its credibility on the line by 
intervening in an energy dispute between Russia and Ukraine, says the 
IHT, the diplomatic gamble has failed to get the gas flowing - 
"damaging the prestige of the 27-nation bloc in the process."

One does not then need to follow all the twists and turns of the 
unfolding drama. It should suffice for us to know that, after "eight 
days of hectic negotiating," no Russian gas is flowing. "Exasperated 
Europeans", we are told, are now resting their hopes for a 
breakthrough on a meeting today between Merkel and Putin, the latter 
deigning to come to Berlin.

That, in itself, is a snub to the EU. The Czech Republic holds the 
"rotating presidency" so it should be up front in the negotiations. 
Dealing with the organ-grinder rather that the monkey, is somewhat 
upsetting the "colleagues'" sensibilities, even if they would rather 
the Czechs disappeared into a black hole somewhere. Procedures are 
procedures, and they must be "respected".

However, while the euroweenies fret about their position in life, the 
world and the universe, one singular fact is crystal clear. The noble 
monitors despatched by the Lords of the Universe are confirming that 
the Russians are "not putting gas into multiple entry points as 
requested." Furthermore, "they are clearly not providing the level of 
supply needed for transit."

Cue, therefore, an intriguing piece from the Kyiv Post. Not exactly 
my daily fare, it obviously carries a great deal of weight, as it 
seems to agree with what I am thinking. What sterner test can there be?

"To little notice in America" (or the UK, I might add), it intones, 
"a drama is being played out in Eastern Europe that future historians 
may mark as the beginning of the end of Russia's neo-imperialist 
ambitions under Vladimir Putin."   Stirring stuff that is, especially 
when it then lines up some impressive facts. Not least of these is 
that the spat with Ukraine is "completely bogus". Ukraine has by far 
the largest gas storage facilities in Eastern Europe, going back to 
Soviet times when it was the centre of the gas industry. It can 
easily survive the cut-off for the entire winter season by using its 
stored reserves.

Thus, the real victims are the half a dozen Eastern European 
countries that have neither alternative supplies nor large storage 
facilities and are already in the midst of a dire socio-economic 
emergency - to say nothing of the EU, which is looking distinctly, er 
. impotent.

Moving on to tell us that Putin needs the money from gas sales rather 
badly, Kyiv Post then speculates on why Putin is engaged in "such a 
crass power play". There, we get some really interesting stuff. 
Russia and its oil and gas industry, it says, "are in the middle of 
the economic equivalent of a death spiral, with potentially dire 
political consequences for the Kremlin." It continues:

It was only six months ago that Gazprom, at that time the third 
largest company in the world with $350 billion capitalization, 
confidently forecast that it will become the largest in the world 
with $1 trillion valuation by 2015. Many a Western banker also nodded 
in agreement to Gazprom's other prediction of $250/barrel price of 
oil in 2009.

As Putin managed to build monetary reserves of $600 billion - the 
third largest in the world - Russia did look invincible for a time. 
He also bribed the Russian people into political acquiescence by 
jacking up salaries and pensions 200 percent since 2000, even though 
GDP and productivity had gone up barely a third of that.
Alas, we are told - and had guessed as much - it was but a house of 
cards:

With no industrial production worth mentioning, its infrastructure 
badly dilapidated, virtually all of its food imported and mortality 
rates only found in sub-Saharan Africa, Russia under Putin had become 
a classic banana republic with oil and gas. It lived or died 
depending on the price of bananas over which it had no control.

You can read more of the detail if you like, but the bottom line is 
that Russia is stuffed . and not by the euroweenies. With its savings 
currently being wiped out by creeping devaluation, unemployment 
spreading rapidly and food inflation approaching 30 percent outside 
of Moscow, it is only a question of time before people take to the 
streets.

The "colleagues", it would seem, have staked their reputation, and 
their energy security, on a loser. No matter how they refine their 
negotiation strategy - even sending in the dreaded Javia Solana - it 
looks like they are dealing with a dead parrot . a former parrot, if 
you prefer. They would be better off going for a peace deal with 
Hamas which required Khaled Meshal to sing Hava Nagila in the mosque 
every Friday.  [For those not up in such matters Meshal is the top 
man or no 2 in Hamas and the Hava Nagila is a Jewish song of 
rejoicing  pNo it is a bit obscure innit?)

Funnily enough, Andrew Wilson, senior policy fellow and expert on 
Russia and Ukraine at the European Council on Foreign Relations - one 
of those "experts" who so impress my co-editor - thinks that the 
crisis has helped to stiffen the EU's resolve. Methinks, given its 
current condition, it is not its "resolve" that needs stiffening.

But one can only hope that its affliction is one that even Viagra 
cannot cure.