Tymoshenko and Yushchenko's Loudest Confrontation Yet: Privatization

It used to be that Yushchenko would send uncountable directives over to Tymoshenko and she would blithely ignore most of them and work towards her own purposes while saying she "admires" the president. He would veto what she did, issue a new directive, and the process would start again.

Recently, things have degenerated.

The major sticking point is Tymoshenko's extensive privatization plan, the proceeds from which she intends to use mostly for government remunerations (or handouts) to holders of Soviet bank accounts made worthless in the aftermath of the fall of the Soviet Union. Yushchenko considers this an irresponsible use of the money, and accuses her of privatizing into the hands of her allies--the claim made by pretty much every party against a privatization by one of its opponents.

So, for example, since State Property Fund Chairwoman Valentyna Semenyuk has been one of the main agents blocking Tymoshenko's privatizations, Tymoshenko kicked her out and installed her own chairman, Andriy Portnov. Yushchenko reinstated Semenyuk, cancelled the privatizations, and issued a "yellow card" warning to Tymoshenko's government. The Constitutional Court overturned his decision, and Tymoshenko told Portnov to ignore it. Along a parallel track, the privatization of, for example the Odesa Pre-Port Plant has been ordered, suspended, ordered again, and again suspended. The Eurasia Daily Monitor has a summary of all the tit-for-tat.

In retaliation, it seems, BYT lined up with the Party of Regions and Tymoshenko said she supports a vote to decrease the President's power in favor of the Parliament (and she's been taking on a number of advisors from the defunct and unmourned SDPU(o) of Viktor Medvedchuk, though this may not be a retaliatory gesture as much as a tactical one). However, when Yushchenko saw that he lacked the support of the Constitutional Court and the Parliament, he backed down. His statement is a classic one of a politician accidentally saying the truth:

Let us not put to question which organization [of power] we need, but focus on the task of achieving, through dialogue, through the work of public commission, through public referendum, a system of counterweights which would ensure serene future for us and our children.

Exactly. Now why have you been wasting your time on this issue practically since you got into office?

Not that Tymoshenko or Yanukovych are any less to blame. The last link goes to an article in Dzerkalo Tizhnya: it's wordy, but overall a great article. The line that pretty much sums everything up:

Each of the three top Ukrainian political players more or less realize the need of the reforms, but all explain their slackness by the following logic: “Now preparations for the decisive battle are going on. What is of critical importance now is to garner as much resources and voter support as possible. It is imperative that sufficient financial, media and electoral reserves be built up. I will begin attending to the country’s salvation and development once I take the country’s top office for a long enough period”. The result is that Tymoshenko and Yushchenko are competing in populism, while Yanukovych, in the absence of State resource, is busy with NATO and language-related issues. This provides an explanation as to why we keep making the same mistake, which is because we make no headway. A country cannot move ahead unless and until the main state and public challenges are correctly identified and begun to be dealt with. Purely personal and corporate interests of policy makers cannot provide enough progress to drive us away from the same old mistake.

Speaking of wasting their time on political games while gas and inflation crises loom...

The Kyiv Mayoral Election vs. Macroeconomics

Taras Kuzio, writing in the Eurasia Daily Monitor, thinks BYT's candidate in the Kyiv mayoral election, Turchynov, will be able to get past Klitchko and Chernovetsky, citing corruption charges against both of the latter. I still fail to see how Turchynov is going avoid similar charges sufficiently to overcome the huge gap in public support between himself and the main contenders--particularly since there will be no runoff. Not that we should want Chernovetsky to win (which recent polls think he might, using the same tactics as last year).

This mayoral election is the biggest distraction from the two main problems for Ukraine, both of which are economic: inflation and fuel price hikes. 

While Tymoshenko was certainly overstating things when she said her government was getting the highest appreciation in the world and holding inflation policy unchanged will be enough, it is true that she was praised by the WTO.
The IMF was more moderate in its praise. In this report it did not actively argue against her privatization plan, but it definitely suggested holding back at least some of the money thus earned to promote a more balanced budget (meaning less going to Tymoshenko's handouts). Another one of its main points is that the hryvnia should be allowed to float against the dollar (meaning appreciate, in the current economic climate). According to the Ukrainian Journal, the NBU seems interested and Tymoshenko has reigned in her criticism of the bank on at least this issue. The WTO and IMF both make the situation with inflation seem less dire than Dzerkalo Tizhnya seems to think it is, but DzT bases more of its assessment on an expected massive fuel price hike from Russia (something I also think is imminent, and the IMF notes as a potentially major problem).

Two More Good Items 

One alternative to politics-watching is this entry on Ukrainiana about Chernobyl. It includes Taras's own story from living (six years old) in Kyiv at the time. It also is heavily laden with YouTube videos related to the event.

Another wonderful and unrelated article by John Marone at Eurasia Home praises the introduction of national standardized university examinations. One step forward for transparency, one step backward for corruption.

BYuT and NUNS fight over city politics, the nation gets closer to crisis

February and part of March were the Party of Region's chance to waste everyone's time blocking parliament with their NATO Circus of Obstructionism. The end of March seems to have been burnt up looking for the next issue for politicians to focus on. Now it's April and they've finally found something to keep themselves from addressing any of the multiple looming disasters—the Kyiv Mayoral Election.

NUNS is the less popular party, but is pushing for the vastly more popular candidate in this election: Klitchko. BYuT's candidate is Turchynov, who has about 6% popularity to Klitchko's 31%. That means that if Tymoshenko wants him to win she'll have to spend massive amounts of time and political capital to do so. So far she doesn't seem to have been deterred at seeing what PoR earned for its anti-NATO efforts on a national level—a ten percent drop in popularity and repeated local election losses to Bloc Yulia Tymoshenko.

Certainly Baloha and his new gang (a breakaway from NUNS) haven't acted constructively and won't do so in the future. But NUNS bleeds votes every election because of their pettiness and unprofessionalism. It's BYuT, which is stronger and more politically savvy that will need to compromise here, because there are much bigger national problems her Cabinet needs to be addressing.

Inflation

Thank's to IIU's blogging, readers here already know that inflation is a big problem that's getting worse. Years without reform, worldwide price increases for foodstuffs, government-on-government increases in unsupported payouts to voters (the most recent being Tymoshenko's payments on Soviet accounts) have all resulted in 26% inflation this March.

As with other issues, NUNS and BYuT are working at cross-purposes. Tymoshenko's payouts went through, but the privatizations she proposed to use to generate the money to pay for them were vetoed by Yushchenko. She's tried to get rid of a longstanding land auction ban which she also thinks could improve economic growth (I do, too) and has again been vetoed by Yushchenko. I would be less apt to think Yushchenko was simply playing spoiler if I saw any indication that he has a better plan instead of his usual vague generalities.

Tymoshenko has said the government going to stop inflation in five to six months. To do this will take actual reforms, though, and that means working with NUNS. That may not be possible under any circumstances, but fighting over the Kyiv mayor is the one way to ensure defeat.

Gas Price Hikes

RosUkrEnergo is still hanging on in Ukraine-Russia gas deals despite Tymoshenko's opposition. She is claiming a victory anyway by saying that the deals will happen on Russian soil so it is technically "out of the Ukrainian market", but it looks from this angle like she's trying to save face after failing to eliminate it.

Though Russia has been able to keep its intermediary (and its active push to keep RosUkrEnergo throughout the negotiations last month confirms that it is, indeed, Russia's preferred intermediary), this won't stop Ukraine's gas prices from increasing significantly in the next few months. The ultimate driving force will be simple, rational self-interest: why sell at under $200 per m³ to Ukraine when Europe will soon be paying over $300 per m³ to Europe?

The price rise has already been foreshadowed: a month ago Russia increased the price it pays Central Asia for gas. This was not out of generosity: it was a revision to preempt hard bargaining by Central Asia, or (much worse for Russia) actual progress on alternative gas routes to Europe that don't include it (one of them is Tymoshenko's White Stream project, lauded by The Economist, which would be a great use of her considerable political skills if she weren't too busy in Kyiv). Russia's price increase is likely to be passed on to Europe in the near future, and Ukraine should not expect to be far behind.

We should not be distracted from this issue. Yes, another Russian general has threatened to attack Ukraine militarily (and with "other methods" as well), and responding in a professional manner was important. Yes, Kommersant claims Putin said Ukraine "isn't a real nation" and it will "cease to exist" if it joins NATO (a claim his government has not refuted). Ukrainian politicians should remember this when dealing with Russia (Hey, Yanukovych, you've been shouting a lot about Ukrainian national sovereignty at anti-NATO rallies—refresh my memory, when did any NATO ally threaten that as much as Putin just did?). Nevertheless, the real motive force in the gas sphere will be the $100 per m³ price differential. Either Russia will take payment in cash, or in ownership of Ukrainian energy assets, but it won't sit for long without payment.

I don't know when the hike will come. Gazprom may not know, and maybe not even the Russian government. But since the Russian government doesn't like NATO and doesn't think Tymoshenko is going to give it anything in exchange for the discount pricing, the hike will certainly come this year. If Russia is looking to improve its chances of getting paid, it may hike them this summer or wait until inflation is more under control, so it doesn't catch Ukraine when it is more desperate. If it wants to shake Ukraine up more it may load on the hike about the same time that inflation problems come to a head.

Not Even Together Enough To Host A Soccer Match

Inadequate preparation for Euro 2012 should be a big issue. There is $25 billion more investment that needs to be made, Ukraine's reputation is on the line—this should be a cause for major concern. But, because the government has gotten into an inflationary and budgetary mess that dwarfs even this event, all that I'll do is note that it's still a problem. I will add, though, that it particularly unhelpful to see Yushchenko blithely state that everything is going smoothly despite warnings from Ukraine's host partner Poland and the Euro 2012 committee.

Tymoshenko Should Support Klitchko 

Below inflation, gas prices, Euro 2012, somewhere under corruption in public transportation, is the Kyiv mayoral election. And yet, the politicians of an entire nation are occupying themselves with this single city election.

Tymoshenko doesn't need to look very far to know what she should do in this situation: all she needs to do is remember her own decision ahead of the 2004 presidential election.

In 2004 she gave up her own candidacy in order to support Yushchenko, despite her ego and despite the animosity between them that is unlikely to have emerged fully-formed in January of 2005. The reason she did so was that she did not have a real chance at the presidency (her public popularity was in the low teens, I believe), but Yushchenko needed help to overcome his opponent Yanukovych. Divided, their two parties could have both lost a legitimate election to Yanukovych. In doing the right thing, Tymoshenko also earned enough voter support to improve her political rating far beyond anything she had had thusfar.

Tymoshenko should support Klitchko. Like Tymoshenko in 2004, Turchynov in 2008 is little more than a spoiler. This is especially true since the mayoral election, unlike the presidential, is decided without a runoff (though BYuT is trying to change this). If Turchynov and Klitchko fight one another, it is likely that both will lose to to Chornovetsky, whi is still polling above 30% popularity.

In a real, monetary way, Ukrainians cannot afford to watch BYuT and NUNS continue to squabble. If Tymoshenko makes the magnanimous step here, not only will it improve the nation's chances in the upcoming crises, but likely result in voters rewarding her as they did after 2004.

"The Party of Regions (Regions) should be riding high in Ukrainian polls as opposition parties traditionally have golden opportunities to increase their popularity. Instead, Regions and its leader and former Prime Minister Viktor Yanukovych have been declining in popularity and are in a crisis. On March 6 Regions lost 6 mayoral elections in eastern Ukraine to local independents and the Yuliya Tymoshenko bloc (BYuT)." (EDM article by Kuzio)

The article reminds me of a broadcast of the show "EpiCenter" where the commentator spoke about the results from local elections and how BYuT was winning in local elections. Though from the way that he reported it, he made it seem as a 'conspiracy' of some sorts. My mom's commentary was "what did they think ByuT was going to do? plant potatoes? they are a political party."

"NATO membership is a not a priority, though, for voters as a whole. Only 0.8 percent of voters in Donetsk (compared with a Ukraine-wide average of 4.4 percent) considered it important, and it was second to last in a list of thirty-four priorities. In Ukraine, as in most countries, foreign affairs is not a high priority for voters, who vote on “bread and butter” issues." (quote from EDM article)

Check out Taras of Ukrainiana's footage from the anti-Nato rally in Kyiv.  

"Prime Minister Yulia Tymoshenko’s group will soon join forces with opposition Regions Party to create a panel in Parliament that would focus on making amendments to the constitution, lawmakers said Monday. The panel, which will be a direct challenge to President Viktor Yushchenko’s own plans for re-writing the constitution, will focus on whether to dramatically increase powers of the prime minister." (Ukrainian Journal)

While "The faction of the Party of Regions at the Verkhovna Rada has elected Anatolii Kinakh as the deputy chairman of the faction for coordination with other parties and NGOs.... Anatolii Kinakh is the leader of the Ukrainian League of Industrialists and Entrepreneurs and the head of the all-Ukrainian Association of NGOs "People's Majority of Ukraine." The main tasks of faction deputy chairman Kinakh include the realization of public initiatives, accumulation of successful experience of NGOs and political organizations, the consolidation of their influence on the democratic reforms in the society and the organization of civil control over the work of the authorities." (Ukrainian News)

BYuT has yet to announce their candidate for Kyiv Mayor but so far no single candidate from the 'democratic coalition' though some political parties have combined their support for Klitschko.

"As the snap Kyiv mayoral election draws closer, it looks increasingly unlikely that the governing Orange coalition will be able to decide on a single candidate, raising the chances of incumbent Leonid Chernovetskiy of clinging onto office. Meanwhile, the eccentric Kyiv Mayor has continued to focus on attracting voters with promises and one-time payments. The elections of the city mayor and deputies to the Kyiv City Council are scheduled to coincide with the traditional Kyiv Days celebrations on May 25. The registration of candidates started on March 26 and will be closed on April 15. Candidates and their teams will then have just over one month to impress voters and raise their ratings." (Business Ukraine)

"An unseemly squabble within the governing coalition is currently hampering efforts to select a single Orange candidate for the forthcoming Kyiv Mayoral elections []. This lack of co-operation has come as no surprise to anyone who is even vaguely familiar with the goings-on in Ukrainian politics. Rather than representing an ideological split, these divisions within the Orange camp are symptomatic of a well-documented national malaise which seems to prevent Ukraine’s reformist leaders from ever presenting a united front in any but the most desperate of situations. While in opposition, the country’s Orange reformers are always ready to sign pacts and engage in talk of their historic mission, but once in government the appeal of power and the greed of individual politicians appear to take priority over broader national interests and ideological concerns, leaving the voters whose support propelled these self-styled saviours into office feeling cheated by their elected representatives and disillusioned with the democratic process in general." (Business Ukraine) 

President Yushchenko recently made changes to the oversight committee of Oschadbank (ukr UNIAN) (ukr President website) appointing two people from the Presidential Secretariat and replacing Moroz with Rybachuk.

"The bloc of Yulia Tymoshenko undertook obligations to return all frozen deposits of former OschadBank of USSR during two years after coming to authority." (Tymoshenko website)

Excellent paper outlining hx and from the Oschadbank website.

"“We hope that a strategic long-term agreement on supplying natural gas to Ukraine will be signed as soon as possible and this issue will be solved before autumn,” Yulia Tymoshenko said. As the PM of Ukraine says, regardless of the fact that the gas issue is regulated there are several problems the solving of which should be searched in the further negotiating process between Ukraine and the Russian Federation. According to Yulia Tymoshenko, all the present gas agreements signed with Russian side regulate the supply of natural gas to Ukraine only for 2008." (UNIAN)

And more about the attempted buy out of 50% of RosUkrEnergo. (could turn out to be pr disaster for PM Tymoshenko)

Update: When asked about the buyout deal (time 10:56), PM Tymoshenko stated that she thought Mr. Kolomoyskyy and PrivatBank have lost their business nose and it will be the really biggest unsuccessful investment which they would have made in the past 15 years of working in Ukraine. She thinks that this will be a downfall investment because the company RosUkrEnergo has gotten marks not only from the Ukrainian side but has also received marks from the Russian side and the whole world many years ago, in 2006, all experts who know this matter, said this is corruption, shadow, non-transparency, and that is why putting money into such projects is absolutely [?] matter. Would advise him against it. (Reuters version) And from ukr UNIAN and  UNIAN "As UNIAN reported earlier, Alexander Medvedev, Gazprom`s deputy chief executive, said the group had long-term contracts under international law with Rosukrenergo, the Swiss-based trader, and therefore could not immediately cut it out of the trade. "We are not finished with Rosukrenergo. You see we have a system of long-term contracts with Rosukrenergo in international legislation," he told the Financial Times in an interview. "We are now working very carefully not to be in breach of the contract signed."

"Prime Minister of Ukraine Yulia Tymoshenko hopes that already next week the Verkhovna Rada of Ukraine ratifies all documents necessary for Ukraine’s accession to the WTO. She announced this at her meeting with the diplomatic corps." (eGov Monitor) (ukr UA Gov Portal)

Nope not about Yulia's first 100 days but references Ukraine beat Serbia 2-0

There is lots of info. about the first 100 days Kyiv Post, UNIAN, EDM, PBN Report,  in ukr here, here, here, Mirror Weekly, Tymo website, Gov website, video clip, complete video,  УНІАН (but is it fair since Parliament has only been functioning for a couple of weeks?) 

And check out Yulia on 1+1 "Я так думаю" Part 1 Part 2 Part 3 original date of broadcast 3/27 and a "meet the press" format. Or avail in one single large file.

Deputy Minister of Finance, Liudmila Khodos has given in her resignation from the Cainet position, citing that the government has not been fulfilling its election campaign promises regarding social wefare. Headline to the story is "Further Cracks in Tymoshenko's Group?".  The Deputy FinMinister gave it three months, and stated that 'Three months has shown that the government is not occupied with economics and is not interested in those questions, which were declared during the campaign, but is involved in politics.' While another Internet site states that the reason for the resignation was the former Deputy Minister's interest in participating in resonance court procedures which the government is uninterested in winning and showing a result. When pressed for details she stated that specifics perhaps would not interest the general public as this is a specialized terms and dealings. (? confused about this as details always are of interest to the general public - the more the better.) She did mention the case of smuggling food goods in Lviv oblast and that she did not see the MinFin being interested, but that she could be wrong. (Interesting to see if she changes political affiliations.)

International news: Lots of photos from the International Rhythmic Gymnastics World Cup 2008 tournament, being held in Kyiv. Ukraine's Anna Bessanova won the 2007 all around gold medal. and this is footage from 2006. Olga Kapranova from RU won the 2008 World Cup.

Oleg Lisogor won gold for the 50m breast stroke at EU Swimming Championship.

Small Plane crash near Kyiv with three dead and 18 sailors trapped under water after a collision in Hong Kong waters. (Ukrainian Journal)

Staring March 28th The International Human Rights Documentary Festival will run in Kyiv for one week. All public viewings are free of charge. More info. on website.

"The Verkhovna Rada of Ukraine has submitted the draft law on introducing amendments into the Constitution of Ukraine in the part of canceling the deputy’s immunity for the consideration of the Constitutional Court of Ukraine. According to an UNIAN correspondent, 226 out of 449 parliament members, registered in the chamber, voted for this decision. In particular, 156 MPs from the BYuT faction and 70 MPs from the OU-PSD supported this decision." (UNIAN)

"Speaking during a visit to Brussels after the announcement, Ukrainian President Viktor Yushchenko welcomed the agreement with Gazprom but noted that parts of the deal still had to be "assessed and accepted."

The president's press office later said Yushchenko had called for a meeting with Ukrainian Prime Minister Yulia Tymoshenko, who has been heavily involved in the gas negotiations with Russia. Under the agreement, Gazprom said Ukraine will meet a Russian demand that gas deliveries so far in 2008 will be paid for. Starting this month, Ukraine will no longer make gas payments via opaque intermediaries criticised by Ukraine's leadership, it added.In clauses that analysts said could prove more controversial for Ukraine, the deal said Gazprom will supply Ukrainian industries directly from April and hinted at price hikes for imports from 2009. ...

The price for that gas will be 315 dollars per 1,000 cubic metres. Naftogaz explained that there would be no payment as such but that the 1.4 billion cubic metres of gas delivered by Russia in January and February would effectively be worked out through reduced supplies going forward. Gazprom said Ukraine will also pay, via RosUkrEnergo and another subsidiary, UkrGazEnergo, for deliveries of 5.2 billion cubic metres of Central Asian gas that were made in January and February. But from March until the end of 2008, the payments will be made directly by Naftogaz at a price of 179.5 dollars per 1,000 cubic metres, in line with demands made by Yushchenko ahead of the talks, the statement said. ... "We don't think the potential increase in Central Asian gas would have any effect on Gazprom but it would have a very significant, almost devastating, effect on Ukraine if it happens," said Kushnir from Deutsche Bank." (AFP) For a slightly different report of the story check out Bloomberg.

For more go to Kremlin Inc (which I am happy to say has gone up the Google scale :)  

"The Protocol of Mutual Understanding has been signed in the Verkhovna Rada. According to an UNIAN correspondent, Speaker Arseniy Yatseniuk claimed this, opening the plenary session. At the same time, he noted that the protocol joins into force only after the decree on NATO is adopted. Arseniy Yatseniuk also assessed positively the fact that Verkhovna Rada has resumed its work. “At last, it happened”, he said." (UNIAN) (RIA Novosti) (ukr UNIAN)

"Parliament resumed normal operation on Thursday after four major political groups signed an agreement ending their standoff seven days before President Viktor Yushchenko could obtain the power to dismiss the legislature." (full story Ukrainian Journal)

First order of business was the vote on Ukraine's entrance into NATO and the resolution was passed: 175 deputies from PoR, 34 votes BYuT, 19 fvotes NUNS and 20 votes from Lytvyn Bloc.  And then a break and the evening session will begin later. The morning session was blocked  by PoR. 

"The resolution says that a decision to this effect [seeking NATO membership] may be taken only on the basis of a nation-wide referendum results, about which the Parliament Speaker would inform the NATO Secretary General." (NRCU)

"The National Bank of Ukraine has proposed that the Cabinet of Ministers raise this year's annual inflation forecast from 9.6% to 12%." (Ukrainian News)

"Implementation of inflation targeting comes with several key conditions: government support, effective inflation policy by the National Bank and the National Bank’s independence in action. Under such conditions, the National Bank will be able to maintain a low level of inflation rate as well as interact with society on matters connected with implementation of inflation targeting. ..." [In addition to numerous recommendations] "... First of all, the interference of the government in the process of setting prices should be reduced so that inflation can reflect the general economic correlation between supply and demand." (Mirror Weekly)

"Yushchenko, who called the inflation “very serious,” demanded a concerted effort from the government and from the National Bank of Ukraine to stop the inflationary pressure. The president specifically warned the government against using administrative tools. But the government’s anti-inflationary plan contains a number of administrative measures, including controls on prices of power, natural gas and water supplies to households, according to a person familiar with the plan. The plan also anticipates keeping budget the deficit within 2% of the GDP this year, which is in line with Yushchenko’s demand, and easing imports of some goods, such as grain and gasoline, to allow greater competition and to drive prices down, the person said. But the plan doesn’t call for curbing social payments, the feature of the Tymoshenko government program that independent economists say is probably the main reason behind the rising inflation this year. The developments put greater pressure on the NBU to hike its key interest rates again this year, following a dramatic two-percentage-point increase in early January to 10%. But further interest rate hikes, together with monetary policy tightening, may stifle economic growth, Zhukovskiy said.

New disagreements emerged between President Viktor Yushchenko and Prime Minister Yulia Tymoshenko on Monday, now over the government’s economic policy and planned anti-inflationary measures, with presidential officials criticizing the government over a spike in inflation." (Ukrainian Journal)

"Latest rift between president and PM centers on state spending bill ... A new rift emerged between President Viktor Yushchenko and Prime Minister Yulia Tymoshenko on Thursday over a bill that regulates about $20 billion in annual spending by state companies and agencies. The Tymoshenko group joined forces with the opposition Regions Party on Wednesday to approve in the first reading the bill that the office of Yushchenko says makes the spending less transparent." (Ukrainian Journal)

"The Head of Government [Tymoshenko] stated that “the passed in its first reading bill the Government had worked through with Association of Ukrainian cities and with those who are guided by tender legislation”. According to Yulia Tymoshenko, “the Presidential Secretariat has fully encouraged this document, first deputy head of the Presidential Secretariat Oleksandr Shlapak has signed it and during consideration it has been supported by “Our Ukraine-People’s Self-Defense” group. That’s why I can’t understand why this “not nice” political situation around this law emerged,” the Prime Minister announced." (UNIAN)

"[Yushchenko] “The work being conducted today in the Verkhovna Rada on this draft law as the matter of fact is a corruptive plot. I am very concerned about alliance between Party of Regions and BYuT who propose to preserve the existing corrupt model,” – said V. Yushchenko adding that he will never sign the law in its current version." (UNIAN) (watch full interview Feb. 17th on Inter tv local time 8 pm.)

"The President said that a few different opinions should exist in parliament, and if some deputies disagree with other deputies, they should find the way to express their opinion in accordance with the procedure. "Respect the procedure, respect the dialogue. When you don't let others speak from the rostrum, it does not mean you are right," Yuschenko said." (Ukrainian News)

"We are convinced that, if the Party of Regions and Communists wished debates in essence on NATO, we would hold them and vote the four draft resolutions submitted by practically all factions. Yet, the opposition does not really need this debate. Asked when the Rada may return to work, the OU-PSD leader said: "We will wait until the Party of Regions' voters will get sick and tired of this senseless hanging about the rostrum. Protest against the unreasonable blocking of the Rada will grow, in the society even more than in parliament, Kyrylenko added." (NRCU)

Don't know if I agree that protest against the blocking of Verkhovna Rada will grow amongst the people. Even with outrageous scenes as in this Ukrainiana post and footage.

" "The vote by deputies from the factions of BYT, the Party of Regions and communists for keeping in place the corrupt schemes of effective law No.282 testifies that an economically vested interest dominates over political fights, even the fight over NATO, and has showed that the parliament configuration is determined by anything but political positions," the statement of the [Lytvyn] faction reads. ... As Ukrainian News earlier reported, Baloha said it is possible that the Bloc of Yulia Tymoshenko, the Party of Regions and the Communist Party will form a coalition following the adoption of the bill on government purchases and President Viktor Yuschenko's veto on it. On February 12, the bill on government purchases passed the first reading in parliament. The bill raises the lower limit on application of the purchase procedure from UAH 20,000 to UAH 80,000 for goods and from UAH 50,000 to UAH 200,000 for services. A total of 282 deputies voted for taking as the basis bill No.1476-d amending the Law on Government Purchases while at least 226 votes were required for its passage. The factions of the Our Ukraine People's Self-Defense Bloc and the Bloc of Lytvyn did not vote for the bill." (Ukrainian News)

" "There will be no signature of President Viktor Yuschenko on this document on any condition. The Head of State will never give his blessing to misuse and dark manipulations involving government funds. He had expected the new parliament to put government purchases in order, but the BYT faction out of its personal interests voted for an explicitly corrupt bill and inflicted a blow on the hopes of the President," the press service quoted Baloha as saying." (Ukrainian News)

"Parliamentary Deputy Viacheslav Kyrylenko, who is the leader of the parliamentary faction of the Our Ukraine-People’s Self-Defense bloc (OU-PSD), is forecasting that President Viktor Yuschenko will meet with the leaders of parliamentary factions on Thursday, February 14. ... Opposition parliamentary deputies blocked the parliament’s rostrum on Wednesday morning, thus preventing a parliamentary session from taking place." (Ukrainian News)

"[Kyrylenko] the coalition is ready to partake in discussing all draft resolutions on NATO, but then the lawmakers must decide which of the documents wins a majority vote. Mr Kyrylenko emphasized that people now care more about wages, pensions and abolition of parliamentary immunity than about NATO membership, but appropriate bills cannot be put to vote because of the destructive position of the Party of Regions and the Communist Party." (NRCU)

speculation on the future of the Ukrainian oil and gas industry

Yuliya Tymoshenko is back and (I find the pun leaping to my typing fingers with the speed of inevitability) she's been cooking with gas. In addition to a whole raft of proposed economic reforms (including the TTI--Tymoshenko Transparency Index--which contains some admirable goals, but is ever-so amusingly self-absorbed) she's been promoting big-time gas and industry changes.

RosUkrEnergo and UkrHazEnergo

The new news is her statement that Yushchenko and the National Security and Defence Council have agreed to eliminate the RosUkrEnergo intermediary from Ukrainian-Russian natural gas trade. If true, this will be a victory for her, as she has long opposed the intermediary (for solid economic reasons, as described in detail in this article, though  the article does get embarrassingly laudatory at times). At another conference on the plans for her visit to Russia (Feb 21-22), Tymoshenko repeated that should be no intermediary. This despite the overall " harmony and understand" theme she was working on to try to put a diplomatic face on things (the Russian government has on occasion attempted to distance itself from RosUkrEnergo, likely because its lack of transparency makes it highly suspicious to the kind of energy investors Russia would like to woo, but has also never showed itself eager to eliminate the company from trade relations; Yushchenko has certainly couched his support for continuing the intermediary in "keep Russia happy" terms).

Moreover, Russia itself seems to be helping her. I thought I was going to be the first to make this connection and bring you some real news instead of bloggy conglomerations, but then I found this article at the Eurasia Heritage Foundation (anyone know something about this source?). The writer, John Marone, also noticed with interest the arrest of Seyon Mogilevich by the Russian government. The Eurasia Daily Monitor article details two prevailing theories on the arrest (that it was done by opponents of Medvedev to show they're still relevant or by Putin to put Mogilevich where he won't be talking to reporters), but Marone was more interested in how Tymoshenko might be able to use the arrest, since Mogilevich happened to be the major Russian participant in that very same RosUkrEnergo scheme.

He reports her statement on the arrest:

“The presence of additional middlemen is a sign of specific corrupt activities. The recent arrests demonstrate that the international community is following events and will not allow the development of any shadow models, including among states bordering the EU. Therefore, my position remains unchanged: all shadowy middlemen will be shut down.”

Nothing surprising there, but her discussions with them at the end of February should be fun to watch.

The White Line 

Simultaneously, she's kick-started discussion of another gas pipeline route, one that would bypass Russia but travel through Ukraine on its way to Europe. This comes at a time when another Russian-bypass pipe project proposed by EU countries themselves (Nabucco) has been foundering. (In an article called Pipedreams published the week before her announcement, Economist described the situation.)

How seriously should we take this? To put things bluntly: this sounds a lot like another Odesa-Brody pipeline and we don't hear much about that these days. Before Tymoshenko's White Line, it was the big pipeline project that was going to get Central Asian oil to Europe without Russia. As the linked RFE-RL article points out, though, Ukraine failed to find the oil to pump under Kuchma, and it's been pumping Russian oil the opposite way since 2004. While there is a prospective extension of that pipeline to Plock, there are still a lot of questions. To create another line to meet whatever unknown demand is left over with as-yet unknown supply does not seem particularly promising.

Nevertheless, even having the option on the table is a bargaining chip. And a reasonable argument can be made that a major reason for the failure of Odesa-Brody was a lack of government will to push it through and risk Russian retaliation (in forms such as raising the then-bargain natural gas rates), a lack Tymoshenko has never felt.

So throwing this idea sounds like fun to me, though I can't see why she called it the White Line and not something more like, say, TymoTunnel.

WTO and, Why Not?, the EU

Ukraine finished WTO bilateral negotiations this January (this was not a Tymoshenko thing; rather it was a steady if obscenely slow process pushed along by the last four government formations). Should the WTO officially welcome in Ukraine at its Feb 5 meeting, as Yushchenko has predicted, there will definitely need to be further reform and efforts to harmonize standards (referred to by the Ukrainian agriculture minister and indirectly by Yushchenko in his call for Tymoshenko to oversee the transition process for the grain sector). Nevertheless, Russian Finance Minister Alexei Kudrin makes his government look rather spiteful and self-absorbed for saying Ukraine (after fourteen years of negotiation; the first ten of which were a wash) has recklessly rushed in "on unfavorable terms just to get in ahead of Russia."

However long we've been waiting for this move, that Ukraine will be getting into the WTO soon is a reason for a little bit of celebrating. Tymoshenko did so by proposing that the EU join Ukraine in a free trade zone and share joint visas with it.

The strategy reminds me of an old Calvin and Hobbes comic I once read:

"Mom, can I set fire to my bed mattress?"
"No, Calvin."
"Can I ride my tricycle on the roof?"
"No, Calvin."
"Then can I have a cookie?"
"No, Calvin."
"She's on to me." 

Who knows, maybe the EU reps will be squishier than Mrs., uh... Mrs. Calvin's Mom. (Then can we have an EU *action plan*?...)

Okay, full day's session of NSDC devoted to resolving Naftohaz. Fantastic and about time. Yipee. So the upshot is there are no debts but there are unmade agreeements between Naftohaz and UkrHazEnergo, and the goal is to make Naftohaz stable. PM Tymoshenko is to be directed to decrease tax loading on Naftohaz. (I am truly starting to get annoyed at Channel 5's reporting. Sigh. It may be the 'death of an era'.)

Esp. as compared to report from 1+1  The National Security and Defense Council charged the Cabinet to take measures to correct the financial state of Naftohaz and save it from bankruptcy. The marathon session of NSDC lasted 7 hours.

It's the politicians who are thuggish

Democracy has never been the most polite form of government. If one were to try to find a government full of polite officials, one would want to look elsewhere, say the latter part of the reign of Louis XIV in France. No, democracies are confrontational and often raucous. Thanks to a commercial for milk, for example, I won't ever forget that American politician and vice president Aaron Burr and American founding father Alexander Hamilton fought each other to the death over an insult. Or the non-milk-related historical incident of Preston Brooks beating Charles Sumner into unconsciousness with a cane on the senate floor while his friends stood guard with a pistol (which, incidentally was not enough to get him kicked out of the Senate).

Be that as it may, democracies have had a few decades to learn some manners. Which is why the incivility of Ukrainian politicians is particularly galling. Both this great Business Ukraine article, and this good article from Taras Kuzio's blog lay out the situation well.

Internal Affairs Minister Punches Mayor of Kyiv

A new low point came when Internal Affairs Minister Yuriy Lutsenko punched Kyiv Mayor Leonid Chernovetskiy in front of top politicians. My kudos to Kyiv Post for their response: having the top figure in law enforcement try to score points by hitting an opponent is an embarrassment. For him continue to be pleased with him about it is disgusting. PoR is right: resigning would be a respectable thing for him to do, kicking him out would be fair (though their scrums around the podium whenever Yushchenko and Tymoshenko factions are looking concilatory are hardly different, aside from the number of people involved). What an appalling model Lutsenko showed all the police officers under him.

Listen to Leopold the Cat: "Let's Live in Harmony!"I wouldn't take things as far as Kyiv Post and call directly for the resignation. It would be enough to see an apology and chalk one more bad mark for crudeness in Ukrainian politics. But Ukrainians won't even get that. (update: They did! Lutsenko apologized. My respects to him for admitting his mistake like an adult, and I wish him luck in corruption-fighting) Instead, Yushchenko ordered a probe. (What in the world could that be for? Lutsenko hit him in full view of other politicians, nothing could be more obvious. Is he implying that there's something Chernovetskiy could have said that would justify the attack?)

What's worse, I rather like some of Lutsenko's politics, and it hasn't hurt my impression of him that PoR's done everything it can to stymie him. How disappointing to see him disporting like them, then.

They Talk Ugly, Too

It seems almost anticlimactic to mention more bad language from Yanukovych after Lutsenko's actual violence. Moreover, he used it to accuse his opponents of separating friends from khokhols (an epithet used against Ukrainians), rather than calling them names directly (like chattel, among other things). But much of the nastiness in Ukrainian politics starts in this way. As Kuzio points out: since it is not possible to actually prosecute high-level officials for libel, or anything else for that matter, libelous and hateful words abound.

The problem is in finding the limit. Generally the thing that stops politicians is not fear of accountability before their peers, it is fear of disgusting voters. When that's the only check on words, things get ugly, because voters are notoriously responsive to negativity: the limit on scathing words is not particularly stringent.

Not Much In the Way of A Fix 

I know I'm not going to wow you by saying that the best step towards more civility would be to remove deputy immunity from prosecution. The new government is more likely than the Yushchenko-Yanukovych association to actual scrap the immunity, but there's still not a lot of movement forward.

To end on at least a mildly optimistic note, there's one form of ugly speech that Ukraine is relatively free of: military bellicosity. This is a particularly attractive feature of politics in this country when I compare it to, say, the statements that get made by Russian generals these days.