Thursday, March 27, 2014

Ukraine: Precipitous or Peril

The IMF announced its deal.  The first part is $18 billion over two years.  Then if the reforms required are pushed through there is another $9 billion available.  I think we're over the $40 billion in promised aid to Ukraine now.  

However, the aid does not come without teeth, serious teeth which are going to bite the average Ukrainian hard.  The first is a rise in the price of natural gas starting in May of 50%.  Not a phased in, but rather a simple jump.  The second I have seen is a serious cut in social spending by the government.  This has been already passed as of today, if I am not mistaken.  Finally, which won't hurt the average Ukrainian much, the tax rates for the richest Ukrainians are going to go up.  A LOT.  

The US White House and Congress have become become EXTREMELY worried about the Russian troops on the eastern border.  The types of units being moved in, their constantly exercising and continuous reinforcement seem to belie the claim these are normal exercises. It also fits the pattern before the invasion of Chechnya and Georgia.

Putin is getting angry over the threat of cutting Visa and Mastercard off from Russia.  He's threatening to make a domestic equivalent, but how long and how corrupt would it be?

The Right Sector marched on and protested in front of the Rada.  They want the Interior Minister fired for the death of Oleksandr Muzychko. They "apologized" to the Russians for not turning violent and having no plans to do so.

Timoshenko is planning to run for president of Ukraine.  If she gets it, its a disaster.  She should not be let ANYWHERE near the levers of power in Kiev.  She and Yuschenko are to blame for the Orange Revolution failing.  

 

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