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| Photo by Forbes.com |
(Revised 5 February 2015)
The question in itself was not all that extraordinary, as a father of a large family; friends have frequently approached for advice on parenting. We had spoken several times on questions of family values and child rearing.
“When do you think we should start having kids?” my young Ukrainian friend asked me.
I gave the usual answers. However, his follow-up question left me speechless.
“What about war?” he continued.
I was dumbfounded. My wife and I had never had to even contemplate that question. However, for my friend, this was a crucial consideration. His country was at war. Crimea had been taken away by “little green men,” the eastern regions of Ukraine were embroiled in armed conflict, and everyone knew someone fighting in the ATO (Anti-Terrorism Operation). Not only did my friend have to worry about the possibility that war could spread to Kyiv itself, but that he too may need to defend and possibly die for his country.
I told him that honestly, I had no adequate answer. My country, while at war for over fourteen years in foreign lands, had not seen armed conflict on its soil for over a century. This was a question I never had to face. I explained, however, that it is difficult for me to hear about suffering children in war zones. I immediately see my own children and shudder to think what the child and the parents are going through.
My friend’s question drove home the reality of Ukraine’s crisis more powerfully than any journalistic report ever could. My friend had been on the barricades of Maidan Nezalezhnosti (Independence Square). His wife, while supporting his actions, feared for his life and on several occasions begged him not to go. My friend was one of the tens of thousands of the faces we saw on our television screens dressed in makeshift armor facing down Viktor Yanokovich’s elite riot police. For him the struggle for a truly independent and free Ukraine was not finished.
This dialog with my friend could just as likely have been repeated on the other side of the battle lines, which stretch through the Donetsk and Lugansk regions of Eastern Ukraine. Young couples in Donbas are certainly pondering the same questions as the sound of Grad rockets and artillery reverberate through their cities and Russian troops stream across the border bringing the latest Russian military hardware with them on their “vacation” to Eastern Ukraine and Ukrainian volunteers gather to meet them.
Additionally, the threat to Ukraine’s stability comes not only from Ukraine’s powerful neighbor, or even from those Russia backs in Ukraine’s eastern regions. It also comes from those who have volunteered to fight for Ukraine’s territorial integrity. They have made it clear that they had come out to rid Ukraine of not only foreign interference, but even more so, from the dishonesty, corruption, incompetence, and repression of the political and economic “establishment.” They have made it clear that those they elected to replace their ousted President and his supporters have a limited time to show progress in reforming Ukraine’s corruption ridden political and economic system before they return to set things right by force. Thousands of battle-hardened and heavily armed fighters could return to Kyiv to bring about the change the politicians have been unable or unwilling to produce.
What was the catalyst of the rebellion and subsequent conflict? The Western media has portrayed it primarily as a response to Yanukovich’s rejection of the Association Agreement with the European Union. In fact, the protests against this action were initially relatively small. It wasn’t until the Berkut riot police of the Ministry of Internal Affairs tried to forcibly clear out the protesters, that Kyiv at first, and within days much of Ukraine, rose up against the president they had elected just four years before. This misunderstanding in the West is illustrated by the different names the West and Ukraine give the revolution. The Western press calls the events of November 2013 through early 2014 the Euromaidan Revolution, while Ukrainians call it the Revolutsiya Natsionalyogo Dostoinstva or the Revolution of National Dignity.
An tale of two squares serves to illustrate the difference in these two terms. In downtown Kyiv there are two squares located not far from each other – European Square (Euromaidan) and Independence Square (Maidan Nezalezhnosti). The pro-EU opposition parties gathered largely on Euromaidan, while by far the largest protests took place on Maidan Nezalezhnosti. The Independence Square protesters’ demands were much more varied. While closer ties with the West were important, grievances against government excesses and corruption were by far more prevalent. This, more than anything else, illustrates how the Ukrainians themselves see their revolution. It was a demand for independence, for a restoration of national dignity.
Furthermore, it is illustrative that few of those I spoke to in Ukraine said not signing the Association Agreement motivated them to protest. While they were disappointed in Yanukovich’s move, they were not ready to revolt to change the President’s mind. In reality, the spark that ignited the mass action was the television footage of bloodied students being beaten by riot gear-clad Internal Affairs troops, purportedly in order to clear space for a New Year’s tree. This action brought the growing frustration with government corruption and ineffectiveness, combined with Yanukovich’s increasingly repressive and heavy-handed policies to a boiling point. Tens of thousands rushed to Maidan Nezalezhnosti, overloading the city’s transportation system.
The frustration with Yanukovich’s policies built on years of disappointment as the people, time and time again, elected “champions of freedom and progress,” only to see them subsequently filling their pockets with the ill-gotten fruits of a corrupt economic and political system. The heroes of the Orange Revolution Viktor Yushchenko and Yulia Timoshenko were not exceptions. This explains the cool reception Timoshenko received when she appeared on Maidan after her release from prison in February of 2014. It also explains her limited role today. She was pro-West, but still part of the establishment.
Yanukovich came to power in 2010 when, frustrated with their fallen Orange Revolution heroes, Ukrainians turned to the man they had rejected in 2004. Unfortunately, the kleptocracy not only continued, but grew and thrived under his rule. To make matters worse, he filled government posts with people of divided loyalties and began building Putin-like verticals of power and controls over the mass media.
On the economic front, not only did life for the average Ukrainian not improve, but Ukrainian businesses were sold off to Russian conglomerates and disparities in wealth increased. Yanukovich’s elaborate “cottage” was a stark reminder of the gulf that separated the average Ukrainian from the power brokers and oligarchs, who ostentatiously flaunt their wealth on the streets of Kyiv with their Bentleys, BMWs, and Ferraris.
These were the reasons my Ukrainian acquaintances gave for rising up against their elected leader and his privileged inner circle. They were tired of their livelihoods being eroded while Yanukovich and his cronies grew ever richer and cozied up to Putin’s elite at the expense of Ukrainian sovereignty.
The vast majority of protesters were tired of the establishment taking care of its own narrow short-term interests at the expense of the average Ukrainian. They were tired of being a pawn in the East-West struggle. They wanted to build a Ukraine that can be prosperous and free of external meddling.
Is there hope that my friend and his children will see a peaceful and prosperous Ukraine? I think there is, but that future lies in the hands of the Ukrainians themselves and the path will not be easy.
After
being away for almost five years, the difference in national pride and desire
to make a change for the better was palpable.
Kyiv of 2009 was emotionally drained and resigned. Kyiv of 2015 is energized, proud of what they
accomplished and determined that the blood spilt would not have been in vain.
Only by demanding real change can they build a strong and prosperous Ukraine that can stand up for its own interests in the face of outside forces, both from the East and the West. Right now, Ukraine’s plundered economy can barely support its brave, but battered military, and its outdated factories cannot compete with its modern, high-tech western or even less efficient Russian competitors. Ukraine needs investment, innovation, entrepreneurship, and leadership.
Consequently,
much needs to be done to create an investment and innovation-friendly
environment. Property and labor laws are
outdated, many dating back to Ukraine’s Soviet past. Foreigners cannot buy land, and small
business ownership is complicated by corruption and onerous registration rules
that not only make it difficult to do business, but also make it almost
impossible to close that business and let employees go when things don’t work
out.
An equitable and efficient system of business registration and liquidation are critical to small business. Whereas many small businesses fail, a reasonable means of exit is vital. A friend and economic consultant at CASE Ukraine[1] explained that it may take years to officially close a business. This results in obligations to pay the numerous licensing and operating fees long after the business has ceased to function.
Additionally, the Soviet era employee regulations give employees rights to compensation for months, even in cases when they simply stop coming to work. This, combined with the above issue makes the cost of registering and running a legitimate business higher than operating in the off the radar.
As
a result, much of the Ukrainian economy exists in the shadows and its workers
are paid “in envelopes,” which leaves businessmen vulnerable to shakedowns by
corrupt officials. This also means that the uncollected taxes the
government needs to build effective infrastructure, defense capability, and
social supports go instead into the pockets of extortionists.
While Western governments have pledged financial support to Ukraine, the amounts promised are woefully inadequate. Ukraine cannot be saved by international aid alone. The money needed to rebuild her aged and plundered infrastructure outstrips what donors and creditors have promised. Only foreign and domestic investment can provide the amounts Ukraine needs to create the economy her citizens dream of. However, those investments will only begin to flow when Ukraine has taken the steps necessary to ensure a safe, secure, and adequate return on investment and to establish an equitable business climate.
I contended in my article “Money to the Winds – Russia’s Capital Dilemma,” [2] with greater risk, capital will expect higher returns. Absent adequate incentives, capital will avoid risk. Right now, the Ukrainian system promises plenty of risk with little prospect for adequate returns.
By meeting the demands of the protesters on Maidan Nezalezhnosti to liquidate corruption and create conditions for legitimate business to prosper, Ukraine can change this situation. However, the clock is ticking and Ukrainians will not wait forever for the changes they demand. They have given their current leaders a mandate, but one with conditions and a timeline.
President Petro Poroshenko inherited a job few would envy – a country wracked by civil war and near financial collapse. If he is able to do what he was elected to accomplish – eliminating corruption and graft, maintaining territorial integrity, and restructuring the government and economic system – he will go down in history as one of the greatest leaders of our time. If he cannot, he will take his place on the list of Ukrainian presidents defeated by processes beyond his ability to control.
I have hope for the former and fear the latter. I hope my friends will be able to build the Ukraine they so ardently desire, one where they can raise their children – a Ukraine where those children will look upon them as that great generation that stood up to corruption and tyranny and built a better nation worthy to take its place among freedom loving democracies.
