Volodomyr Zelensky has had a tough job since February 2022. And since the election of Donald Trump it has become a whole lot tougher.
In just the past ten days the American president and his acolytes have gone over his head and behind his back to negotiate directly with Russia’s Vladimir Putin; accused Zelensky of being a dictator; demanded virtual total control of the Ukrainian economy; ruled out Ukrainian membership of NATO and the return of territory; accused Ukraine of starting the war and undermined negotiations by announcing that Russia “holds the cards.”
Trump has also damaged relations with NATO allies by cutting them out of any negotiations about Ukraine’s future, despite the fact that Ukraine is in Europe and the Europeans have contributed more to its defense then the US.
But hold on. Zelensky and his European allies have a few cards of their own.
The biggest ones involve cash. Russia is spending and leaking money and earning less and less while its bills pending pile grows bigger and bigger.
Let’s start with its Sovereign Wealth Fund (aka National Wealth Fund or NWF). This has been the main source of ready cash for Putin’s “special military operation.” In January 2022, the NWF coffers held $210 billion. At the start of this year, the fund had dwindled to $116 billion. But wait, it’s even worse than that. Almost all of the war spending comes from liquid reserves which have shrunk more than 75 percent from $130 billion to $40 billion.
At the current rate of spending, Putin will run out of liquid cash in less than a year. His borrowing options are limited. The IMF and World Bank are out of the question, as are western commercial banks. This leaves the Chinese who would doubtless drive a hard bargain.
Russia does have an additional $335 billion in assets held in western banks. These were frozen at the start of the war and Ukraine is receiving about $1 billion a year in interest from this money. There have been moves to hand over all the money to Ukraine, but this would set a dangerous legal precedent as the funds are protected by international law.
Russia’s other main revenue source is its oil and gas. It has switched most of its sales to China and India. But those countries are taking advantage of the war to demand discounts of up to 50 percent. On top of that, they are paying roubles, the value of which has plummeted by half since 2022.
Russia is also running out of people—soldiers and workers. Defense manufacturing is swallowing up an estimated 22 percent of all factory jobs. Wages in munitions factories have doubled so that defense spending now swallows 40 percent of the federal budget. Its military has suffered an estimated 800,000 casualties.
However, Ukraine also has major problems. The constant missile attacks on Ukraine’s infrastructure means that Ukraine’s GDP has shrunk by 25% since the start of the war.
Which brings us to the battlefield. Russia is advancing, but at a snail’s pace. The two opposing armies have settled into a World War I-type stalemate complete with trenches.
The standstill is largely down to 21st century battle techniques. Both sides are heavily reliant on drones and satellite surveillance; Ukraine more so because of its smaller army. This means that a soldier can’t advance more than a few feet before being spotted by a satellite and taken out by a drone.
The Ukrainians rely primarily on three satellite systems: America’s Starlink system, a German system developed by Rheinmetall and a Finnish satellite system. Of these the most effective is Starlink because it is able to provide real-time battlefield surveillance and intelligence. If the US were to withdraw Starlink, Zelensky would have to pay for costly commercial satellites and the intelligence would take longer to gather and process.
When it comes to weaponry, the Russians would clearly have the edge if Trump pulled the American plug. Most important would be missile defense systems. Britain, France, Germany, the Netherlands and Sweden are all providing surface to air missile defences which can defend against most missile and air attacks. But only the American Patriot missiles are effective against hypersonic Russian missiles. In addition, European stocks of surface to air systems have been depleted by the war and its defense industries are unable to meet demand.
One of Zelensky’s unused tactics is conscription. Ukraine’s volunteer army currently stands at 980,000 against Russia’s 1.5 million. It is reckoned that conscription would swell the army’s ranks by 1.5 to 2 million. But all the polls indicate that the move would be highly unpopular.
Finally, there is the possibility of Ukrainian attacks on Russia. So far these have been limited to the Kursk salient and a handful of drone attacks. The Ukrainians have been held back by Washington which is frightened of escalation. But then Zelensky might be faced with escalate or die if Trump withdraws American support.
* Tom Arms is foreign editor of Liberal Democrat Voice. He also contributes to “The New World” magazine and lectures on world affairs. He is the author of “America Made in Britain,” two editions of “The Encyclopaedia of the Cold War” and “The Falklands Crisis.”
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11 Comments
Trumps rapprochement with Putin’s Russia and ultimatum to Ukraine to sign-over its rare earth mineral deposits has been compared to the Nazi-Soviet Pact of 1939 that preceded the dismemberment of Poland. Around 6 million Polish citizens perished during World War II: about one fifth of the entire pre-war population of Poland. Most of them were civilian victims of the war crimes and the crimes against humanity which Nazi Germany and the Soviet Union committed during their occupation of Poland.
When Hitler invaded Czechoslovakia in 1938, a Polish-majority borderland region of Trans-Olza that had been annexed by Czechoslovakia in 1919, was occupied and annexed by Poland following the two-decade long territorial dispute. Hungary also occupied the southern territories of Slovakia and Carpathian Ruthenia, mostly inhabited by Hungarians.
The vultures are circling again around Western Ukraine with some Bulgarian politicians advocating a right to the southern part of the Odessa region.
Not worse than the USA: Bulgaria should claim part of the Odessa region and Hungary’s far-right Our Homeland party would lay claim to a western region of Ukraine that is home to about 150,000 ethnic Hungarians if Ukraine loses its statehood due to Russia’s invasion.
The next stage of Trump’s betrayal of Ukraine will be the unwinding of sanctions on Russia (and Russians).
@Nick – we can expect Trump to include the freeing up frozen Russian assets in his tariff negotiations; as he will be wanting the oligarchs to favour US interests, however, I don’t see then wanting to let Trump and the US having any real direct investment/access to to Russian resources.
Trump is, I am pleased to say, suffering a drop in his popularity in the USA if the polls are to be believed.
Trumps supporters openly talking about changing the USA’s constitution to allow him to run for a third term. Hopefully that will not happen.
All power corrupts and his power is significantly corrupting.
He is the Dictator not Zelensky.
He is a bully and is less trustworthy than most of the worlds leaders. PM watch your step…
“All power corrupts and his power is significantly corrupting.”
Indeed – and absolute power corrupts absolutely.
Is there anything he would not do?
@Nonconformistradical: “Is there anything he would not do?“…. a few likely answers come to mind. Graciously accept defeat in an election. Utter the phrase, “I’m sorry, I was mistaken”. Accept some constructive criticism of something he’s done.
😀
@David Garlic. Trump supporters may talk of changing the constitution. Clearly they haven’t read it. (Which by the way would take you less than an hour). A change to the constitution requires a 2/3 majority in BOTH houses of congress AND the agreement of 3/4 of the states. Given that Republicans have a very small majority in the House and a wafer thin majority in the Senate the first requirement is unattainable even if all Republicans could be persuaded to vote for such an amendment and since the Republicans don’t control 3/4 of the states (far from it) the second requirement is equally unattainable.
As always, Mick, you are correct in your quotation from the US Constitution. But since when has Trump ever allowed himself to accord to constitutional technicalities? He thinks he can use his election mandate to ignore it. So who in the USA has the power to challenge him? Certainly not the Democrats, and not of the three arms of government will do anything but back him, for fear of the vindictive actions that will follow.
But we should also challenge Russia ourselves, in concert with our European allies. Notwithstanding the huge share of the Russian budget now being expended on the war (at least 20%), the size of Russia’s GDP is less than commonly believed. The Russian GDP is actually less than that of the UK alone, or that of Germany, or that of France! We can stand up to Putin, even without the USA, and we should do so.
@RifWinfield. Trump may try to ignore the constitution, but he can only do that if the Supreme Court were to dismiss any challenge. [And, despite your dismisal of the Democrats, there would be a challenge if he tried to run again] Now I’m fully aware of the conservative majority on the court, but the SC members are all experienced judges, who cannot be threatened or sacked, because they are appointed for life or until they retire. Making a ruling on abortion or same sex marriage is one thing, but actually overturning the constitution is quite another. In any event the SC can only ‘interpret’ the constitution not change it.
Amendment XX11 section 1 is very clear.
“No person shall be elected to the office of the President
more than twice, and no person who has held the office of
President, or acted as President, for more than two years of
a term to which some other person was elected President
shall be elected to the office of President more than once”
I can see no way of interpreting this to allow Trump to run for a 3rd term. So an amendment will be needed and as already outlined, there is no way that such an amendment can get the required support.
@Mick Taylor
I believe there may be a way of Trump getting round the Constitutional amendment since he is prevented from ‘being elected’ President for a third time but not from ‘becoming’ President for a third time. Therefore, if he stood as the Vice-Presidental candidate in 2028 and Vance or whoever was the Presidential candidate stood aside after being elected, Trump could legally become President again.
America has pulled the plug so what has changed? Quite a lot judging from the european efforts to increase defence spending and persuade Trump to reverse his decision. If we take Trump at his word that he is playing the honest broker then it seems we are edging closer to a ceasefire and hopefully an end to hostilities. Nobody wants the killing to continue though it is up to Ukrane to decide the terms for any ceasefire being aware of Russia’s history of attacking again once it has recouped its resources.