The absurdity of Seven Republicans’ Visit to Moscow

Torrey Taussig, a research fellow at the Brookings Institution, nails in the article the absurdity of the 7 Republican lawmakers’ 4th of July visit to Russia.

https://www.kansascity.com/news/politics-government/article214584130.html

The seven Republicans, representing most of the geographic center of the US from north to south and covering most of the US’s major gas and oil distribution system raises the question what interest and who's they are pursuing since they have no tangible publicly expressed objectives for their initiative.

TheHill.com: Armenians’ Peaceful Revolt Could Reverberate

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TheHill.com

If not for reporting by Radio Free Europe/Radio Liberty and Al Jazeera over the past two weeks, you could be forgiven for not knowing a political earthquake was taking place in Armenia. The Western media hardly carried a word until Monday when, after 11 days of massive demonstrations in the country’s capital of Yerevan, Prime Minister Serzh Sargsyan bowed to protesters’ demands and resigned. The implications though will ripple out from Armenia, across the Caucasus and the post-Soviet space.

While the protests targeted political and economic corruption, the spark for the demonstrations was an attempt by Sargsyan and the ruling Republican Party to extend their control of the government by appointing Sargsyan as prime minister following two terms as president, despite his earlier promise that he would not do so.

A key moment in the protests occurred when hundreds of soldiers broke ranks and joined upwards to 100,000 protesters in Yerevan’s central square. In the manner of the recent popular protests in Iran and the earlier Orange Revolution in Ukraine, the protests were fueled by social media and spontaneous support from ordinary citizens that overwhelmed the government’s ability to control the narrative on the ground. When the protest leaders in Armenia were taken into custody, the leaderless protests swelled in numbers and continued.

 With Sargsyan gone, Armenia now must organize its interim government and plan for elections. The protest leader, Nikol Pashinyan, and the interim prime minister, Karen Karapetyan, who is a former prime minister and former mayor of Yerevan, met and failed to agree on a way forward. Protests are continuing.

The Yerevan protests demonstrate once again the latent power of civil society as a brake on political and economic corruption. Armenians held large protests in 2008, 2015 and 2016 against a host of grievances, including, as enumerated by Human Rights Watch, not only corruption and election fraud but also “overwhelming poverty, and the economy’s domination by oligarchs who are close to political leadership” and “the lack of accountability for abuses committed by law enforcement, lack of judicial independence, and other human rights issues.”

An informed (and enraged) public, once aroused, is more than a match for an entrenched autocratic government — a lesson autocratic rulers who aspire to uncontested rule might note, such as Russia’s President Vladimir Putin, China’s President Xi Jinping and Turkey’s President Recep Tayyip Erdoğan.

The Yerevan protests also signify the continuing decline of Russian influence among the post-Soviet independent nations. It is more striking in Armenia because of Armenia’s complex economic and security relationship with Russia, including a frozen conflict with its neighbor Azerbaijan for which Armenia needs Russian support. Russia even maintains a substantial military base at Gyumri, Armenia. Putin's spokesman Dmitry Peskov said Moscow was monitoring the events in Yerevan because the country is "extremely important" for Russia.

Russia’s own internal political and economic weaknesses are enabling neighboring countries to chart independent political courses. Putin repeatedly has warned (and as recently as April last year) that Russia will not allow “color revolutions” to take place, especially among the members of the Collective Security Treaty Organization, of which Armenia, Russia, and the Central Asia nations are members. Yet, Russia has struggled to contain popular — and often anti-Russian — protests in neighboring countries, short of military intervention.  

Another military adventure, such as those that Russia has carried out in Ukraine, Georgia or Moldova, would result in crippling Western sanctions that Russia can hardly afford. On a minor note, Sargsyan once served in the Soviet military and speaks the Russian language fluently.  There is every chance he will be the last Armenian leader to do so.

Popular uprisings against political and economic corruption across the former Soviet space do not mean that peace and prosperity are assured to happen in those countries. It does mean that the search for peace and prosperity is taking those countries in new directions that are less constrained by historical context. The people of Armenia have forcefully declared their desire for honest government and a decent chance at economic opportunity.

Dirk Mattheisen is a writer/blogger on political economy and governance. He is a former assistant secretary of the World Bank Group in Washington (2008-2012) and alternate secretary of the World Bank Board Ethics Committee. Follow him on Twitter @dirkmattheisen.

Why Cryptocurrencies Aren't Going Away

http://thehill.com/opinion/finance/378891-heres-why-cryptocurrencies-are-a-sign-of-the-times

What’s it take to get a little respect? In a Congressional Financial Services subcommittee hearing last week, congressmen expressed “deep skepticism” about cryptocurrencies, echoing critics’ claims that cryptocurrencies are nothing but a pyramid scheme updated for the electronic age.  Rep. Brad Sherman (D-Calif.) stated emphatically, “Cryptocurrencies are a crock.” And last week, bitcoin — the best known of the cryptocurrencies — slipped to a new low under $8,000 after peaking around $18,000 in late 2017.

But maybe bitcoin and its cryptocurrency relations are more than that. Maybe they are a sign of the times.

Cryptocurrencies, including bitcoin, are built on a bit of sensible digital innovation known as distributed ledger technology, made possible by the expanding electronic universe. Remember the term “distributed ledger”; like “email” and “social media,” it will become a big part of your life.

A distributed ledger is the electronic record of actions, such as financial transactions, changes in inventory or legal records, that are recorded nearly simultaneously at different nodes or locations on the internet through an algorithmic validation process. Through the magic of programming, distributed ledgers have the attractive quality of being difficult to falsify and have advantages of scale, accessibility and transparency over non-electronic ledgers.

The best known use of distributed ledger technology is blockchain. Blockchain is distributed ledger technology that is purpose-built to record a series of related actions. The possibilities are endless. For example, blockchain is being used to validate the provenance of diamonds and the business conglomerate Louis Dreyfus recently carried out the first blockchain agricultural trade.  The phenomenal range of blockchain uses is evident from prowling trade publications and specialty blog feeds, where stories of new business processes using blockchain are everywhere.

But the best-known use of blockchain is cryptocurrency.

Cryptocurrencies are blockchain programs that mimic real-world money. They are rising in popularity because they have attractive qualities made possible by blockchain. They are “portable,” in the sense you can access them anywhere. They are durable since there is a permanent record. They have, at least in theory, a limited supply fixed by blockchain coding, and a value that is market-driven. In short, cryptocurrencies have all the desirable attributes of money.  

And, if not entirely anonymous (authorities can track cryptocurrency transactions), cryptocurrencies are relatively autonomous from state regulation and oversight and can be harder to hack than bank accounts and credit cards. Even cryptocurrencies’ limitations are appealing. Limits set by programming and large energy requirements to produce cryptocurrencies have contributed to huge valuation increases.

In a world of distrust of state and financial institutions and of economic insecurity, techies have happened on a technique that, conceptually, frees one from the existing ecosystem of regulatory control, legal accountability and bad guys who want your money.

And, it is not just dark money seeking safe havens and avenues for money laundering that account for cryptocurrencies’ popularity. It is also reputable institutional investors and wealth managers seeking greater returns and novel hedges against market risk.

Still, cryptocurrencies are to blockchain a little like a church deacon with a meth lab in the basement. Blockchain is good because it makes business more efficient and cost effective, but cryptocurrencies are bad because they involve risky behavior since they seem to have no real economic or financial anchor to ensure intrinsic value.

However, we have been here before. Cryptocurrencies are reminiscent of U.S. “free banking” in the mid-1800s before 1863 when a U.S. national currency was established. Prior to 1863, the need to supply liquidity to an expanding American economic space extending to the Pacific was filled by countless local banks — often known as “wildcat” banks — that issued their own script. Many of these bank scripts were based on little more than hopes and promises. Some were under-capitalized or backed by dubious assets. Some were frauds.

Shaky as it was, the system worked for a time because of (oft-misplaced) faith in the security of the underlying assets and in the good faith of the local banks to honor their obligations. Still, many went bust before the “normalization” of monetary policy through the establishment of a national currency backed by the full faith of the federal government, as well as federal bonds and capital requirements and tighter federal and state regulation. Sound familiar?

A prescient 1996 paper by the Federal Reserve Bank of Atlanta anticipated the similarity between free bank notes and “electronic money”:

“Electronic money is likely to consist of uninsured liabilities of private individuals or companies. If so, perhaps the most immediate lessons from free banking are that (1) consumers are not sheep waiting to be sheared (2) attention must be paid to the importance of the assets into which the electronic money is convertible and to the issuer’s reputation for making the conversion as promised.”

The bottom line is, with so much personal and business activity moving to the expanding digital universe, that universe needs a digital means to record and store value, just as the American economy in the mid-1800s needed liquidity to finance growth. Digital innovators are making that possible.

As in 1863, early adoption requires normalization. Blockchain is proving itself by expanding its uses, and experiments in cryptocurrency are becoming more credible and mainstream. Even countries with reputations for sobriety, such as Switzerland and Sweden, are considering the idea of national cryptocurrencies; and yes, Venezuela — although, in this case, it is a matter of necessity being the mother of desperate invention.

Will bitcoin collapse? Who knows. But will cryptocurrencies fade and wither like hula hoops and the tulip bulb mania? Don’t bet on it. Even governments know that it is no longer a question of extinguishing but of reining in the wildcats.

You’ll be using cryptocurrencies in the future, just as you will live in smart homes and use driverless cars.

Dirk Mattheisen is a writer/blogger on political economy and governance. He is a former assistant secretary of the World Bank Group in Washington (2008-2012) and alternate secretary of the World Bank Board Ethics Committee.

The Real Threat From Autocracy Is How We Deal With Democracy (continued)

Fareed Zakaria, Opinion Writer for the Washington Post, is an incisive commentator on global political, financial and economic affairs, and never more so then when he and I agree.

His article in the Post today, Democracy Is Decaying Worldwide: American Isn't Immune, echos what I wrote last week for The Hill, The Real Threat From Autocracy Is How We Deal With Democracy, about the erosion of principles and norms from within democracies, including the threat from the autocratic behavior of President Trump.

I had written that a functioning democracy can heal itself, unless a democracy had become neither free nor equitable.  There are palpable fears that the United States is slipping into autocracy...The resilience of democracy in America is being tested by an autocratic president who de-legitimizes ordinary civil discourse through misrepresentation and distortion, aided by complicit actors, such as Chairman Devin Nunes, (R-Calif.) of the House Intelligence Committee and his famously flawed memo on FBI surveillance...While the world's autocracies loom as a threat, the real threat to our welfare and to world peace is how we deal in the democracies with the erosion of basic civil liberties and the rise of domestic social and economic inequality.

In the same vein, Zakaria concludes, "Institutions are collections of rules and norms agreed upon by human beings. If leaders attack, denigrate and abuse them, they will be weakened, and this, in turn, will weaken the character and quality of democracy. The American system is stronger than most, but it is not immune to these forces of democratic decay."

The Real Threat From Autocracy Is How We Deal With Democracy

http://thehill.com/opinion/international/373533-the-real-threat-from-autocracy-is-how-we-deal-with-democracy

In 2017, autocracy — that is, government in which one person wields unlimited authority — seemed to have the upper hand against the troubled democracies of the West.  

Among the democracies, President Donald Trump polarized a divided American electorate, and European elections in Germany, France and elsewhere evidenced equally deep enmity between the political right and left. Brexit all but paralyzed Britain.

In fact, the Economist Intelligence Unit’s Democracy Index concludes that 2017 produced “the worst decline in global democracy in years,” highlighting, in particular, decline in freedom of expression, including media freedom. 

None of the four democracies above even made the top 10 in the EIU’s ranking of 167 countries.  Germany is 13, the United Kingdom is 14, the United States is 21 and France is 29. Of the Asian democracies, Indonesia fell from 48 to 68 in the rankings, the worst country decline globally, and the world’s most populous democracy, India, fell steeply in the rankings from 32 to 42.

In addition to highlighting freedom of expression and media freedom, the EIU pointed to a widening gap between political elites and electorates; declining popular participation in elections and politics; declining trust in institutions; and erosion of civil liberties.

Meanwhile, autocrats had a field day. The absence of a strong U.S. voice at Davos in January 2017 enabled Chinese Premier Li Keqiang to champion free trade, backed up by Chinese investment in a new silk road spanning Asia, Central Asia, Africa and Europe. Russia’s President Vladimir Putin — would-be impresario of a new world order — was credited with orchestrating much of the election and social chaos in the United States and Europe in 2016 and 2017, as well as tilting Britain’s Brexit vote in favor of leaving the European Union.

Turkey’s President Recep Tayyip Erdoğan crushed opposition to his increasingly autocratic rule and cozied up to Putin, distancing himself from Europe and the United States. North Korea’s Kim Jong-Un defied U.S. pressure to end his nuclear weapons program by launching one test missile after another. Wanna-be autocrats Prime Ministers Mateusz Morawiecki of Poland and Viktor Orbán of Hungary defied EU democratic norms from within the union with nationalist agendas. Even President Nicolás Maduro of Venezuela held on, despite one of the most mismanaged economies in history, with an inflation rate of 4,000 percent.

However, by year’s end autocracy appeared no less troubled than democracy.

Putin’s interference in the U.S. election processes provoked a significant expansion of U.S. sanctions against Russia. Russian corruption also resulted in the passage of “Magnitsky” legislation in a number of countries, including Canada and the United Kingdom, targeting individuals responsible for serious civil rights violations, as well as government officials complicit in “acts of significant corruption.”

Although Putin is expected to be reelected in March, social discontent has risen with rising poverty. Putin’s reported desire to achieve 70 percent voter turnout with a 70 percent pro-Putin vote to legitimate his next term may be out of reach because of, on the one hand, voter apathy and, on the other hand, growing opposition activism. Russia ranks 135 in the EIU’s Democracy Index.

Chinese President Xi Jinping’s vaunted Silk Road looked less compelling as it ran into political and economic resistance from other countries concerned with rising Chinese influence, including the United States, Australia and the United Kingdom, which criticized China’s indifference to global standards and norms. Although China’s economy still manages growth of almost 7 percent, high and rising debt levels threaten economic stability. Xi may look firmly in place, but so did Putin in 2008 before the Russian economy turned against him. When it did turn, it was not the reformist Putin of 2000-2004 but the autocratic Putin of 2014-2018 who, to maintain his authority, resorted to increasing oppression (despite the claim of popular support).

Xi is headed down the same path in his attempt to control threats to his authority by tightening control of the military, police and social media.  China ranks a low 139 in the Democracy Index.  

It was, however, the sudden, dramatic fall in December 2017 of President Robert Mugabe in Zimbabwe (136 in the index), after 30 years ruling over a wrecked Zimbabwean economy and society, that illustrated the risk faced by all autocrats. Instability can appear suddenly when the autocrat fails to anticipate a palace coup or a social upheaval due to social and economic tensions because there is no stabilizing mechanism other than oppression. Anti-government protests in Iran (150 in the index) at the end of 2017 against the economic plight and social oppression of ordinary Iranians came out of nowhere, as well, and threatened Iran’s political and economic stability.

Rather than being islands of stability governed by firm leadership, autocracies are inherently unstable because of limited political participation, social oppression and economic inequality that diminish the welfare of the citizens of those states and threaten world peace.

Democracies are more stable because, due to broader citizen participation, they are better at balancing differing societal interests and adapting to change. History is full of failed autocratic states, but few failed democracies. A functioning democracy can heal itself, unless a democracy has become neither free nor equitable. There are palpable fears that the United States is slipping into autocracy. Political discourse is fractured, and the EIU writes, “Income inequality is higher in the U.S. than in other rich countries and has worsened since the global economic and financial crisis of 2007-09. Studies show that higher income inequality reduces trust in others and undermines social capital.”  

The resilience of democracy in America is being tested by an autocratic president who de-legitimizes ordinary civil discourse through misrepresentation and distortion, aided by complicit actors, such as Chairman Devin Nunes (R-Calif.) of the House House Intelligence Committee and his famously flawed memo on FBI surveillance.

While the world’s autocracies loom as a threat, the real threat to our welfare and to world peace is how we deal in the democracies with the erosion of basic civil liberties and the rise of domestic social and economic inequality.

There Is Too Much At Stake In Ukraine To Give Up Now

photo credit

I made the point in an article a few days ago that Ukraine could be at the start of a promising economic recovery (Why I Am Optimistic About Ukraine, Euromaidan Press) that would support a stronger civil society.

The Financial Times this week has two opinion pieces that focus on the one threat to that recovery, the entrenched business and political interests bent on undermining Ukraine's economic and social reforms, as I had discussed in my article.

That both opinion pieces and my article highlight the threat at this time reflects the deep concern in the West that recent political turmoil in Kyiv could derail the reform program.

To conflate the two opinion pieces, both write that there is too much at stake in Ukraine to give up now.

In the first piece, Too Much Is At Stake To Give Up On Ukraine, Tony Barber, FT Europe Editor, warns that if Ukraine "veers off the path of domestic reform it is less likely to flourish as an independent state,"  And, indeed, the current political turmoil in Kyiv around the reform agenda is a serious threat to Ukraine's economic and social development.

However, Barber's observation that the mood has soured and embittered Ukrainians find that "post-Maidan authorities turned out to be no better than their predecessors" does not mean that Ukrainians are ready to give up on reform.  Few Ukrainians would return to the earlier time when Yanukovych and his Donetski thugs lorded over Kyiv and Ukraine.  Therefore, something new has to take its place.  Too many lives have been sacrificed in opposing corruption and Russian aggression.  Attacking the reform agenda is unlikely to dampen Ukrainian civil society's intent to see the reforms through, even if it is likely to result in dramatic moments along the way.

Even so, more can be achieved by civil society with technical and financial help from the West. Francis Malige, EBRD Managing Director for Eastern Europe and Caucasus, in Now Is Not The Time To Give Up On Ukraine, makes the case for Western support; "Giving up on Ukraine means giving up on courageous and determined people, alongside an entire country, at a time when they need us [the West] and when we can protect past successes and achieve much more, if we do it right."  Malige's piece is a convenient checklist of ways that international institutions and bilateral support can help by strengthening the private sector in Ukraine to improve people's well-being, while civil society reforms.

Short of a full-on Russian invasion, it is unlikely that reforms will fail because they have become part of civic culture in Ukraine.  But the reform process does need to keep up momentum so that the benefits--especially economic--become visible and tangible for all Ukrainians.  It is too early to see the full shape of Ukraine's transformation but the elements are there; popular support, civic activism, the realization that change is possible, a maturing multi-party political system and growing familiarity with civic culture in the West to which Ukrainians aspire.

Why I Am Optimistic About Ukraine

http://euromaidanpress.com/2017/12/16/why-i-am-optimistic-about-ukraine/

Article by: Dirk Mattheisen

Buffeted by rapacious oligarchs and invasion by Russia, Ukraine seems an unlikely success story. However, renewed economic growth is fueling a growing sense of optimism and of opportunity. There are a few things getting in the way. But first the good news.

Ukraine’s economy is projected to grow 2.0% this year and then accelerate to 3.5% in 2018 and 4.0% in 2019, driven by a steady growth in consumption of 3% per year and in exports of 1.6% in 2017, 3% in 2018 and 5% in 2019 (recent government estimates of growth are slightly lower but still very similar). Already in 2017 exports to the EU in the first nine months are up 29.1%, which indicates the rapid pace at which Ukraine is taking advantage of access to EU markets). The business press is full of stories about new businesses and investment opportunities, including highly innovative, internationally competitive startups, such as Google’s Grammarly, which was developed by two Ukrainian entrepreneurs in Kyiv, as well as countless “locally-grown” tech startups and micro-enterprises. There is constant chatter about fashion and advertising video shoots in Kyiv, including the recent Apple Watch 3 video, adding cultural flair to the economic momentum.

Ukraine Finance Minister Oleksandr Danyliuk said all the right things in September in the lead up to the World Bank/IMF annual meetings. He pointed to the government’s tough measures to stabilize the economy with the support of a US$17.5b IMF program. He also emphasized the seriousness of the government’s efforts to improve the business climate, such as in tax and customs administration for which Ukraine had hired an international consultancy firm to help run an anti-corruption program and invited the US, Germany, EU, EBRD, and Canada to sit on the supervisory board to ensure the program was not derailed. Danyliuk emphasized that many reforms had been instituted, but it was also now important for the people to feel the effect through improved living standards by not just eliminating high-level corruption but of eliminating petty day-to-day corruption.

However, despite the optimistic outlook, Ukraine needs to take advantage of this period to restructure its domestic economy.  Failure to restructure will slow growth and diminish overall economic prospects.

For example, the World Bank estimates that reforming land ownership laws alone could lift economic growth by 1.5%. This is critical because, as welcome as 4% GDP growth may be, Ukraine has to grow faster for people to feel, as Danyliuk emphasized, a meaningful impact on their well-being. At $2,200, Ukraine’s GDP per capita is roughly a quarter of Russia’s (though more equitably distributed) and among the lowest of the former Soviet republics; to counter Russia’s existential threat to the country, Ukraine needs to increase GDP per capita by several orders of magnitude to demonstrate that its economic model can deliver benefits comparable to other countries.

Ultimately, Ukraine needs to aspire to be a regional economic power in its own right, which would be good for Ukraine and for Europe–nothing would supercharge Ukrainian and EU economic growth like welcoming into the EU 40m talented people with an impressive endowment in resources and a strategic geographic position.

To visualize Ukraine’s economic potential, compare its GDP of about $93 bn to Poland’s GDP of about $480 bn with roughly half the area of Ukraine and the same population. Twenty-five years of serious economic reform separate Polish GDP from Ukraine’s. A more serious effort by Ukraine is necessary to make up the difference in a shorter period of time. As Poland shows, economic growth does not solve all the problems, but it is an essential start.

To make that happen, Ukraine has to get a grip on pervasive corruption that is fueled by lack of respect for the law, ineffective law enforcement and widespread self-interest over civic interest in government and business. Rule of law was the core of the 2014 Revolution of Dignity which, despite substantial progress, remains an aspiration.

Above all, reform has to be credible.

Liberalizing the land market is useless without a reliable cadastral system and market transparency that prevents raiding and speculation. Judicial reform is useless if incompetent or corrupt officials continue to be appointed. The recent appointment of 25 judges with histories of questionable decisions and improbable wealth undermines reform. Criminal charges against public officials, such as those against Ukraine’s General Prosecutor, Yuriy Lutsenko, need to be prosecuted in accordance with the highest legal standards and not subverted by legal artifice that fails to hold wrongdoers accountable. Lack of progress will erode vital international support (as evidenced by the recent halt due to unfulfilled anti-corruption conditions in the EU’s macro-financialassistance program and a slowed IMF program).

Political reform is integral to ending corruption and achieving economic success.

For reform to work, the political process has to serve society’s needs. It can’t if the political and economic elite, including President Poroshenko and members of his government, behave as in the past. The reformists can try to wait out the entrenched interests, risking that the reform process will peter out; or, they can find ways to breath additional life into the process.

Civic activism is essential; and entrenched interests have to support the reform process, which may require some form of selective amnesty for economic crimes committed before the Revolution of Dignity, which these interests fear will expose them to prosecution, and a commitment that they not stand in the way of or undermine further reform. Entrenched interests will not disappear, but they must be made to fall in line.

Timing is crucial. The 2019 presidential election is warming up. It can be a watershed moment in surmounting corruption. President Poroshenko has been effective in leading the economic stabilization program with the IMF and in introducing many of the needed reforms. His resolute defense of Ukraine internationally and support for association with the EU has elevated recognition in the West of Ukraine as a democratic nation distinct and separate from Russia.

However, he has also failed to live up to personal commitments as president, including putting his extensive business interests ahead of the national interest by forming a blind trust; many of his businesses are held in offshore corporations of the type that are used by oligarchs to hide assets and avoid taxes. Extraordinarily wealthy individuals fuel corruption if not checked by law, and they have yet to yield or share power in Ukraine with the next generation of business, government and political leaders who will build the new Ukrainian society. The 2019 election is a good moment for anti-corruption and political reform not just to be declared but to become real in order to unleash the rewards of reform.

Otherwise, popular frustration may overflow. Although recent pro-reform protests in Kyiv fronted by Georgian political activist Mikheil Saakashvili have been small—in part due to the seeming self-interest of its most prominent sponsors, Saakashvili and Yulia Tymoshenko, there is still widespread impatience with the slow pace of reform.

Though the protests have been small, the political risk is not. The “impeach Poroshenko” protest, again led by Saakashvili, is a portent of worse to come if reform is derailed. Public unhappiness will grow, especially if the politically unpopular Porochenko continues to provoke friction with highhanded political assaults on Saakashvili and other opponents and backroom maneuvers to enforce his control of the government. The focus needs to be on advancing anti-corruption and economic reforms and upholding the rule of law, including in politics. Messy disputes (such as this) between anti-corruption authorities and security services and mutual claims of corruption don’t help.

For all the risks, the promise of change is irreversible. Ukrainian society is no longer capable of sliding back into conformity and submission. Ukraine’s transformation into a more just and inclusive society is in its early stages but even now entrenched interests cannot contain Ukrainian society’s new aspirations nor its new economic promise.

Fundamentally, what distinguishes Ukraine is not its historic association with Russia. Cast between competing empires (and sometimes known as the borderlands), Ukraine has a powerful egalitarian tradition based on the independent-minded Cossack warrior-farmer (reviled during Russian-dominated Soviet times as kulaks). This tradition is a distinct cultural identifier setting Ukrainian society apart from a more hierarchical and authoritarian Russian society, something Stalin understood as a threat and attempted to extinguish through state-sponsored genocide in the 1930s.

Completing the key reforms today will transform Ukraine into a democratic nation and an economic power in Europe. In the future, when one speaks of Ukraine–a strong European nation at the heart of a unified Europe—one will be able to say that it’s democratic institutions were formed on its distinctive traditions that Russian imperialism failed to crush and on the renewed vitality of its civil society.