In early February 2014, a recording was leaked of Assistant Secretary of State for European Affairs, Victoria Nuland, telling Geoffrey Pyatt, the US Ambassador to Ukraine, that the UN was on board to “help glue” the plan to replace Ukrainian President Victor Yanukovych with Arxeniy Yatsenyuk. “Yats is the guy,” Nuland informed Pyatt who urged her to move quickly because “the Russians will be working behind the scenes to torpedo” the deal.
“F#&* the EU!” Nuland told Payatt. “Exactly,” he responded.
Shortly thereafter, Yanukovych was overthrown and “Yats” became president. Ukraine agreed to Nuland’s demands to make “a new deal with the IMF,” which was “necessary for the long term economic health of the country.” Yet, the new Western-leaning Kiev government did not represent the Russian-speaking Ukrainians in the east and south who had voted Yanukovych into office.
One year later, Ukraine is racked by civil war and is in depression. The US and EU blame Russia for the destabilization because of its support of Ukrainian separatists. And as punishment, the US pushed the EU to impose trade sanctions against Russia. Russia retaliated with trade sanctions against Europe.
There is no end in sight for the civil war. Kiev has been militarily humiliated by the Russian separatists. Although the US and UK are calling for yet stiffer sanctions against Russia, we forecast that the bottom line is more important to EU members than waging more war.
With trade between Europe and Russia worth 10 times more than US trade with Russia, and since much of Europe is still suffering economic weakness, we forecast that the EU is ready, to paraphrase Victoria Nuland’s words, to now say “F#&* the US!”