Jackson Diehl
Sometimes the stumbling blocks in international affairs are glaringly obvious - such as the victory of Islamic fundamentalists in Palestinian elections, which has temporarily paralyzed the Bush administration's policy of promoting democracy in the Middle East. Sometimes, though, they are complicated, confusing or simply opaque, and thus barely understood beyond a small circle of experts.
That might explain why there has been so little discussion in Washington of a gas deal between Russia and Ukraine this winter that may be as significant as the Palestinian vote. Here is a dense tangle of a half-dozen contracts that involves hidden partners, disputed pricing arrangements, and esoteric side agreements. It is mind-numbingly boring - and it may tip the balance against democracy in much of the eastern half of Europe.
The story surfaced at the beginning of January, when Russian President Vladimir Putin made the mistake of partially halting gas deliveries to Ukraine - and to much of Western Europe. Chastised by big customers such as Germany, Putin - who wanted Ukraine to accept a 400 percent price increase - quickly turned the gas back on. A couple of days later, a deal was announced in Moscow and Kiev that appeared to resolve the dispute more or less equitably: The price of Ukraine's gas rose by a mere 90 percent.
Not until more than a month later did the Bush administration and other key allies of Ukraine's government learned more about what was in the contracts. When they did, they were stunned. Ukraine's president, Viktor Yushchenko, and Prime Minister Yuriy Yekhanurov had agreed to purchase Ukraine's gas through a trading company whose owners and beneficiaries are publicly unknown - but are rumored to include senior officials and organized crime figures in Russia and Ukraine. They granted this same company a 50 percent share in delivering gas to Ukrainians. They accepted a price deal on gas delivered to Ukraine lasting only a few months but guaranteed that rock-bottom rates charged by Ukraine for the storage and transit of Russian gas to the West would be frozen for 25 years.
What does this have to do with democracy in Europe? In effect, some U.S. experts concluded, the Ukrainians may have sold to Putin what he was prevented from stealing: a stranglehold on Ukraine's government. The Russian leader poured money and men into his huge neighbor in late 2004 in a blatant bid to install a pro-Moscow strongman as president. His overreach triggered the Orange Revolution and the subsequent democratic election of Yushchenko, whose goals include leading Ukraine to membership in NATO and the European Union.
Putin sees the fragile new democracy in Ukraine, and an allied government in tiny Georgia, as dire threats. If Western-style freedom spreads in the former Soviet republics of Eastern Europe, his own regime will be isolated and undermined. What's more, Ukraine and its neighbors are likely to integrate with Europe rather than remain economic and political vassals of Russia.
After a turbulent year of free politics, Ukraine has another crucial election, for a newly empowered parliament, scheduled for March 26. This time Putin has avoided open intervention in the campaign. Instead he triggered the gas crisis and presented Ukrainians with a choice: Swallow a mammoth price increase for the heating fuel just weeks before the election, or hand Russia a long-term stake in Ukrainian energy infrastructure - and the ability to trigger a gas supply crisis at any time. Yushchenko and Yekhanurov chose the second option, also agreeing to divert some of the huge profits to undisclosed beneficiaries. When confronted by U.S. officials, they claimed they had no choice; until now they have denied knowing who owns the shell company through which Ukraine will channel billions of dollars.
How to save democracy in Ukraine, and the chance it will someday spread back to Russia? As in the Middle East, the Bush administration faces difficult choices. If pro-Western parties lead the next government - something that is far from certain - President Bush could press them to scrap the gas deal as a condition for the first step toward membership in NATO. But that would probably lead to a new face-off between Ukraine and Putin, in which Kiev would require U.S. and European support at a moment when those allies are pleading for the Kremlin's help with the Palestinians and Iran.
Or the administration could sidestep Putin's gas-fired imperialism, leaving a complicated issue to its present obscurity. The Ukrainians might find a way to free themselves from Russia's chokehold. But they also might allow one of the signal democratic breakthroughs of the Bush years to suffer a crippling reverse.
Jackson Diehl is a member of The Washington Post's editorial page staff.
Posted in Forum on Saturday, March 11, 2006 12:00 am
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