The deepening crisis in Ukraine is swiftly opening up a new gulf between Russia and the West. NATO is urgently reassessing its capabilities, reviving old arrangements for collective security and mounting large exercises in Eastern Europe. Sanctions have already been imposed on a range of Russian economic and political targets and more are being prepared. Western investment in Russia has stalled. Cultural, political and official contacts have been sharply cut back. And Western leaders are talking about years of strained relations with Moscow. Is the world embarking on a new Cold War?
Hangover after Crimea
Russia today is particularly vulnerable to further Western sanctions. Its economy is slowing down, falling to lower growth rates than seen for more than a decade. It is more dependent now on exports of energy than during Soviet times, with these accounting for more than 70% of Russia’s income. And Russia’s economy is far more intertwined with global trade than it was 30 years ago. Any loss of international confidence in Russia would lead to a massive withdrawal of funds: already investors have dumped USD 70bn in Russian assets. Further withdrawal of investment and any moves to reduce Western dependence on Russian gas and oil could push the Russian economy into recession very quickly.
Already there has been a headlong retreat from the Russian market. Renault, the French car maker, has frozen plans to produce vans with ZIL, the Russian truck manufacturer as the weakening rouble has dampened consumer confidence. Japanese banks have withdrawn from deals and suspended credit lines, with two of the biggest – Sumitomo Mitsui Banking Corporation and Bank of Tokyo-Mitsubishi UFJ – stepping back from Russia. Western government credit lines to firms wishing to export to Russia will become harder to obtain. And recently two members of the US Senate said it was time to target industries critical to Russia’s economy.
All this underlines the most important change that has occurred in the past two months: Western governments no longer see Russia as a global partner, and now regard it as a hostile power. Of course there is no longer the sharp ideological confrontation between Soviet communism and Western capitalism. But in many other ways elements of the long confrontation between Moscow and the West have returned. Firstly, the Kremlin, and especially President Putin, regards East-West relations as a zero-sum game, and is therefore determined to deny any political or strategic advantage to the West, believing this will inevitably be at Moscow’s expense. Secondly, the harsh authoritarian nature of Putin’s rule and his intolerance of dissent, especially by non-governmental organisations, begin to resemble the totalitarian atmosphere of Soviet communism. Thirdly, Russian nationalism is reasserting itself in aggressive ways, especially in Moscow’s dealings with smaller neighbouring countries. Fourthly, Russian espionage, both military and economic, against the West is as active as it was in Soviet days. And finally, although Russia has rejected militant atheism and again given the Church a powerful role in society, it is clear from both the Kremlin and from the pulpits of the Orthodox Church that Russia has deliberately rejected what it sees as “decadent” Western values (see p. 42). Indeed, senior Russian clergy taking part in Western conferences regularly denounce the European 18th century enlightenment, which is still the basic of secular values and society in Western Europe and America.
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The soft iron curtain
The West is therefore turning back to two key strategies it used to deal with the Soviet Union: suspicion and containment. The first results in a general assumption in Western capitals that Putin is not to be trusted and is now actively working against Western interests – not only in Europe but in other key areas such as the Middle East. This is the underlying reason why NATO has rediscovered its original purpose: to prepare its members to act collectively in the face of present or future threats.
This Western suspicion goes back a long way: even in tsarist times Britain saw Russia as its main rival, especially in Asia, when both governments were competing for influence in Afghanistan and central Asia. The French diplomat Talleyrand once said something to the effect that the problem with Russia is that it is both too strong and too weak at the same time. Recent events seem to show this is still true.
The policy of containment was first devised by the American statesmen George Kennan to deal with Stalin’s expansionist policies immediately after the Second World War. In many ways containment is easier now. Stalin was not dependent on global trade, had many more allies and ideological supporters around the world and did not have to worry about public opinion at home. He could take global risks in confronting the West without risking domestic unpopularity. But although Putin can count on strong support from Russian nationalists at home for his policies over Ukraine, he risks strong domestic opposition if the Russian economy plunges into recession, if Western nations make it harder for Russian tourists to get visas or if Russian businessmen, oligarchs and cultural figures are no longer welcome in London, New York or Paris.
Military containment will also play a role – though here it may be harder to rally Western opinion than it was 70 years ago. The West, and especially America, have become war-weary, disillusioned with intervention overseas and unwilling to spend more of their national budgets on defence. The main countries in Western Europe do not feel directly threatened by Moscow as they did during the Cold War. Newer NATO members in Eastern Europe will certainly want NATO to demonstrate a robust defiance of Russia and will be pressing for more military manoeuvres and exercises close to the Russian borders. But no one expects a full NATO mobilisation. Even Russian military intervention in Ukraine is unlikely to provoke an armed NATO response.
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Although some hawks in the United States are actively encouraging a return to a harsh confrontation with Russia, few people in Europe relish a return to the Cold War. There are hundreds of thousands of Russians living and working in Western capitals – more than 150,000 in London alone – and many millions more tourists spend large sums while on visits to the West. For the past two decades Western governments have been encouraging more cultural and people-to-people contacts: school visits, language exchanges, visits of musicians, artists and educationists. The British Council, Britain’s main international cultural organisation, has just launched a year of Russia-Britain culture and is deeply reluctant to curtail its programme because of worsening political relations.
Western strategy, therefore, is to try to focus especially on Putin himself and his senior advisers, who are seen as the main drivers of Russia’s aggressive new nationalism. The aim of all measures is to increase political and economic pressure on Putin’s entourage without arousing the blanket hostility and fear of ordinary Russians – who have long memories of European invasions and Western military superiority. The West will therefore keep talking to Moscow as much as it can, using Sergei Lavrov as an intermediary. Even during the dying days of the Cold War, Soviet and American leaders kept their communications open. If there is to be a return to that chilly atmosphere, the West is determined that this will not mean a new Iron Curtain separating Russians from the rest of the world.
