THE WAR IN UKRAINE

THE WAR OF ATTRITION IS CONSUMING BOTH UKRAINE AND RUSSIA

The war in Ukraine has evolved from a special operation supposed to be over in two weeks time to a protracted war where gains are measured in hundred of meters per month. Both sides have difficulties of different nature, as neither can inflict a significant blow on their enemy.

There are problems with the attack from the Russians which have diminished mobility capacity, with its stockpile of tanks and APCs dwindling. The modern T-90 from 1992 is not ubiquitous anymore and there are more and more older, Cold War era tanks like the T-72 and T-62 and even T-55 which was first produced 75 years ago have returned to active combat, as per publication by Forbes. (1).

These tanks were manufactured in Ukraine, so it is not a surprise that Ukrainian Army have plenty of access to these and that there are shortage of spare parts in Russia to return those in long term storage to active combat.

WHO WILL SUCCUMB FIRST?

There was a moment in this invasion of Ukraine that we all expected Ukraine to fall to Russian aggression within the month. We have all been proven wrong and the Ukrainian soldiers as well as population has proved to be resilient and courageous defending their territory.

This is the third year of the war and the donations from the United Kingdom, Europe and United States have kept Ukrainian afloat. This is half a trillion dollars of money and equipment donated. Russia is far from ever from winning the war today.

WILL THE WEST SUPPORT FALTER?

There is no actual chance the West will stop supporting Ukraine in this war. The best strategy and the best tactics is to keep Ukraine fighting so that Russia will not be in position to further its expansion to Turkey or to Mediterranean countries.

The tantrum Volodimir Zelensky threw at the Oval Office in the White House last Friday has been patched over. Few hours later, Zelenksy was already on Fox News in an interview with Bret Baier saying that he was going to backtrack.

As much indecent it may be to keep the war going to bleed Russia into incapacitation of aggression it is a worthy goal, given that this may restore some of the territory to Ukraine. The longer the fight, the less likely the Russians will be in the future and possibly a better negotiating position may be arranged for Ukraine.

RUSSIA INTERNAL DYNAMICS

Russia has used its reserves in order to finance the war in Ukraine and today the currency is no longer tradeable. The Russian central bank used to trade the currency for the importers and exporters inside Russia but it doesn’t do it anymore. The exchange rate is favorable to Russia, but the volume of trade is insignificant.

Official inflation is rising and is around 10%. The interest rate is about 21%, but volume is low again, showing that the economy depends too much on the war.

This is a problem with two bad results. The first bad result is that if the war is over, there is no “normal” economy to move forward. The resources for the past three years have been transferred to the war machine.

The second problem is that the war machine is a unitary industry. The goods are produced and wasted in war, exploding the infrastructure in Ukraine or getting blasted by Ukrainian defenses. The whole product is destroyed.

The difference, of course, is that a non military truck will transport goods, move earth from 10 years, moving the economy forward, while a military truck that explodes consumes all capital with nothing left behind.

Russia has also a problem with human resources. Since Soviet times there are less babies than the optimal replacement rate. The population is shrinking and the diminishing pool of males for conscription have forced the military to change the upper limit for conscription from 27 to 30 years. Before the conscription was done in the first two years of college, around 20 years old.

The duration of the war, the capacity of Ukraine to invade the Kursk Oblast and even bomb some of the oil refineries thousands of kilometers from the border, breaking Putin’s promises that the war would not affect Russians. There are sporadic signs of shortage of fuel in Russia, which is importing fuel from FSBs refineries.

RUSSIA PARTNERS

Since the invasion of Ukraine Russia have been doing business with several countries. Russia had key exports to several countries that were slow to break the relationship or still keep the commercial relationship although there is a ban on those. These partners include India, Germany, Italy, Brazil, UAE and the biggest of them all, China.

As the war went on and the special operations for two weeks lasted for months, some of the partners gave up in fear of getting trapped into secondary sanctions against Russia and some like Germany got its supply of natural gas shut down. Italy contract was not renewed and thus Russia has less and less income from oil.

In military assistance there is China and Iran. Iran is already an international pariah due to the Iranian nuclear bombs program. China has assumed a dual character of serving both Russia and the Western world.

China duality brings back the disputes there was in the late 1960s of both territorial disputes and which country was going to reign upon the communist community after the communist revolution toppled capitalism.

Once poor and now rich, China is playing Russia in multidimension chess.

The first dimension is that the longer the war in Ukraine lasts, the weaker Russia becomes. There is no escape for Russia. Even if Russia manages to win the war, the Western sanctions will cripple Russia for decades to come.

The second dimension is that Russia needs cash. The banking system is stressed to the point of collapse and Russian reserves are wearing thin. China will push for deals in hydrocarbons that will enslave Russia for years to come, supplying China with cheap crude for the cash advances.

The third dimension is the munitions game. Europe is pledging to help Ukraine with more munitions, including airplanes and missile systems. There is also talk of boots on the ground by Keir Starmer, the prime minister of the UK. This pushes the need for Russia to import artillery and mobile artillery from China, a move that will require Chinese consultants or troops. This may turn Russia into a smaller partner of China.

The forth dimension is how Europe and North America will take advantage of the difficulties Russia is facing in war. If Zelensky signs the contract with Trump, there will be faster movements towards the end of the conflict, but this will incur in a higher intensity of the conflict, with further losses and even precipitating in surprising results.

One of the surprising results may be the encirclement of Crimea, which seems to be hard in the hands of the Russians but it could be retaken due to its dependency on the rail/road bridge that can be shutdown with ease by a missile or even a drone attack for hours or days, even if it is not destroyed permanently, but the logistics will be hindered. In war, a week of disruption may doom the whole peninsula to change hands.

Italy and Germany were happily paying billions of dollars until december 2024 for Russian Gas through Ukraine. Once the contract expired, Zelesnky refused to renew it. An important source of cash has shut down. This means that the oligarchs are not getting money from this origin anymore and their grip on the population will weaken.

SOVIET WIDOWS

There are plenty of Soviet Widows, those who were in favor of the Soviet Union winning the Cold War, but lived in comfortable capitalism, where they took fat salaries to pay for their decadent expenses.

These people are trying to paint the Invasion of Ukraine as a war of reunification between a rogue nation, Ukraine and a legitimate owner of the land, Russia.

These Soviet Widows have a special understanding of international treaties, believing that Russia has the right to special interpretation of these treaties. Russia may get all nukes from Ukraine in the Budapest Memorandum and billions of dollars and after a few years, invade Crimea.

Theses Soviet Widows have invented that the West broke a “promise not to expand NATO eastward” as reason to Russia to invade Crimea and ultimately all out invasion of Ukraine. This has never been promised by no one. There is no memoranda, no treaty, no meeting memory or even a public speech. Only declarations of people who claim to have heard James Baker tell Gorbachev that NATO would not expand.

The only declaration from Baker that is documented, is that NATO would not expand to East Germany after the unification. Remember, On 12 March 1999, the Czech Republic, Hungary, and Poland joined NATO; Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovenia and Slovakia joined in March 2004; Croatia and Albania joined on 1 April 2009.

None of the above triggered Putins wrath. The Soviet Widows lack justification as well as consistency.