By Anatol Lieven, Foreign Policy, 8/27/24

Discussions have been happening for some time among Western policymakers, experts, and the wider public about how the war in Ukraine ought to end. I can confirm that the same type of conversations are happening in Russia.

I recently had the opportunity to speak, on the basis of confidentiality, to a wide range of members of the Russian establishment, including former diplomats, members of think tanks, academics, and businesspeople, as well as a few members of the wider public. Their ideas about the war, and the shape of its eventual ending, deserve to be better understood in the West and in Ukraine itself.

Only a small minority believed that Russia should fight for complete victory in Ukraine, including the annexation of large new areas of Ukrainian territory or the creation of a client regime in Kyiv. A large majority wanted an early cease-fire roughly along the existing battle lines. There is high confidence that the Ukrainian military will never be able to break through and reconquer significant amounts of Ukraine’s lost territories.

Most of my conversations took place before the Ukrainian invasion of the Russian province of Kursk. As far as I can make out, however, this Ukrainian success has not changed basic Russian calculations and views—not least because, at the same time, the Russian army has continued to make significant progress farther east, in the Donbas, where the Russians are closing in on the key town of Pokrovsk. “The attack on Kursk may help Ukraine eventually to get rather better terms, but nothing like a real victory,” in the words of one Russian security expert. “They will sooner or later have to withdraw from Kursk, but we will never withdraw from Crimea and the Donbas.”

The Ukrainian incursion into Kursk has undoubtedly been a serious embarrassment to the Putin administration. It comes on top of a long row of other embarrassing failures, beginning with the appallingly bad planning of the initial invasion. And among the informed Russian elites, I get very little sense of genuine respect for Russian President Vladimir Putin as a military leader—though by contrast, there is much more widespread approval of the government’s economic record in resisting Western sanctions and rebuilding Russian industry for war.

Yet a key reason for my contacts’ desires for compromise was that they believed that Russia should not, and probably could not, attempt to capture major Ukrainian cities like Kharkiv by force of arms. They pointed to the length of time, the high casualties, and the huge destruction that have been involved in taking even small cities like Bakhmut in the face of strong Ukrainian resistance. Any areas of the countryside in Kharkiv province that can be taken should therefore be regarded not as prizes but as bargaining counters in future negotiations.

Underlying this attitude is the belief that to create a Russian army large enough to attempt such a complete victory would require a massive new round of conscription and mobilization—perhaps leading to the kind of popular resistance now seen in Ukraine. The government has been careful to avoid conscripting people from Moscow and St. Petersburg, and to pay large salaries to soldiers conscripted from poorer areas. Neither of these limits could be maintained in the context of full mobilization.

Partly for the same reason, the idea of going beyond Ukraine to launch a future attack on NATO was dismissed by everyone with derision. As I was told, “Look, the whole point of all these warnings to NATO has been to stop NATO from joining the fight against us in Ukraine, because of the horrible dangers involved. Why in the name of God would we ourselves attack NATO and bring these dangers on ourselves? What could we hope to gain? That’s absurd!”

On the other hand, every single person with whom I spoke stated that there could be no withdrawal from territory held by Russia in the four Ukrainian regions that Moscow claims to have annexed. A majority suggested that any territory in other provinces like Kharkiv could be returned to Ukraine in return for them being demilitarized. This would help guarantee a cease-fire and would also allow Putin to claim that he had ensured the safety of adjacent Russian provinces, which in recent months have been subject to Ukrainian bombardment. Some more optimistic Russians thought that it might be possible to exchange territory in Kharkiv for territory in the four provinces, none of which is currently fully occupied by Russia.

I found this balance of opinion among the people with whom I spoke to be fairly plausible as a wider picture, because on the whole it corresponds closely to the views of the wider Russian public, as expressed in opinion polls conducted by organizations that in the past have been found reliable. Thus in a poll last year by the Levada Center, sponsored by the Chicago Council on Global Affairs, respondents were exactly equal (62 percent) in their desire for immediate peace talks and in their refusal to return the annexed territories to Ukraine.

Among my contacts, there were no differences on the subject of Ukrainian neutrality, which everyone declared essential. However, it would seem that serious thought is being given by sections of the Russian establishment to the vexed question of how a peace settlement could be secured without formal Western military guarantees and supplies to Ukraine. Hence the widely discussed ideas of a peace treaty ratified by the U.N. Security Council and the BRICS, and of broad demilitarized zones secured by a U.N. force.

As a leading Russian foreign-policy analyst told me, “In the West, you seem to think that only military guarantees are any good. But political factors are also critical. We have invested enormous diplomatic effort in building up our relations with the global south, which certainly would not want a new war. Do you think that if we could get a peace deal that met our basic requirements, we would throw all that away by starting one?”

Most said that if in negotiations the West agreed with key Russian demands, Russia would scale down others. Thus on the Russian demand for the “denazification” of Ukraine, a few said that Russia should still aim for a “friendly” government in Kyiv. This seems to be code for regime change, since it is very hard to imagine any freely elected Ukrainian government being friendly to Russia for a very long time to come.

A large majority, however, said that if Russian conditions in other areas were met, Russia should content itself with the passage of a law banning neo-Nazi parties and symbols, modeled on a clause of the Austrian State Treaty of 1955. My Russian interlocutors referred here to the treaty’s provisions for restrictions on certain categories of Austrian arms and for minority rights—in the case of Ukraine, the linguistic and cultural rights of the Russian-speaking population.

On one important point, opinion was unanimous: that there is no chance whatsoever of any international formal and legal recognition of the Russian annexations of Ukrainian territory, and that Russia would not press for this. It was recognized that this would be rejected not just by Ukraine and the West, but by China, India, and South Africa, none of which recognized Russian annexation of Crimea in 2014.

The hope is therefore that as part of a peace settlement, the issue of these territories’ status will be deferred for endless future negotiation (as the Ukrainian government proposed with regard to Crimea in March 2022), until eventually everyone forgets about it. The example of the (unrecognized but practically uncontested) Turkish Republic of Northern Cyprus was mentioned. This means that Ukraine would not be asked publicly to “give up” these territories; only to recognize the impossibility of reconquering them by force.

In the end, of course, Russia’s negotiating position will be decided by Putin—with whom I did not speak. His public position was set out in his “peace proposal” on the eve of the West’s “peace summit” in Switzerland in June. In this, he offered an immediate cease-fire if Ukraine withdrew its forces from the remainder of the Ukrainian provinces claimed by Russia and promised not to seek admission to NATO.

On the face of it, this is ridiculous. Ukraine is never going to voluntarily abandon the cities of Kherson and Zaporizhzhia. However, Putin did not say that Russia will then occupy these territories. This leaves open the possibility that Putin would accept a deal in which these areas would be demilitarized but under Ukrainian administration and that—like the Russian-occupied parts of Kherson and Zaporizhzhia provinces—their status would be subject to future negotiation.

Nobody I spoke to in Moscow claimed to know for sure what Putin is thinking. However, the consensus was that while he made terrible mistakes at the start of the war, he is a pragmatist capable of taking military advice and recognizing military reality. Thus when in November 2022 Russian generals advised him that to attempt to hold Kherson city risked military disaster, he ordered withdrawal —even though Kherson was in territory that Russia claimed to have annexed and was also Russia’s only bridgehead west of the Dnipro River. Its loss has vastly reduced Russian hopes of being able to capture Odessa and the rest of Ukraine’s coast.

But while Putin might accept what he would regard as a compromise now, everyone with whom I spoke in Moscow said that Russian demands will be determined by what happens on the battlefield. If the Ukrainians can hold roughly their existing line, then it will be along this line that an eventual cease-fire will run. But if the Ukrainians collapse, then in the words of one Russian ex-soldier, “Peter and Catherine are still waiting”; and Peter the Great and Catherine the Great between them conquered the whole of what is now eastern and southern Ukraine for Russia.

By Malcom Kyeyune, UnHerd, 8/21/24

To understand the truth about the Nord Stream pipeline, one needs to master a certain form of “Kremlinology”. Everything about it is designed to obfuscate, every strand shrouded in prevarication and deceit.

From the start, the investigation was a textbook cover-up. The Swedish government rushed to secure evidence, citing their putative rights under international law, consciously boxing out any sort of independent, UN-backed inspection. Of course, after gathering all the evidence, the Swedish authorities studiously did exactly nothing, only to then belatedly admit that it actually had no legal right to monopolise the information in the first place.

The Germans, for their part, were also supremely uninterested in figuring out who pulled off the worst act of industrial sabotage in living memory against their country. In fact, over the course of a year-long non-investigation, we’ve mostly been treated to leaks and off-the-record statements indicating that nobody really wants to know who blew up the pipeline. The rationale here is bluntly obvious: it would be awfully inconvenient if Germany, and the West, learned the true answer.

Thus, the recent revelation that the true mastermind behind the ongoing deindustrialisation of Germany was none other than a Ukrainian by the name of “Volodymyr Z.” must have come as an unwelcome surprise. For not only is the idea that the authorities have suddenly cracked open the Nord Stream case not credible in the slightest, but the sloppy way in which the entire country of Ukraine is now being fingered is likely not an accident. Indeed, at the same time as the ghost of Nord Stream has risen from the grave, the German government announced its plans to halve its budget for Ukraine aid: whatever is already in the pipeline will be sent over, but no new grants of equipment are forthcoming. The German government is hunkering down for increased austerity, and so it is cutting Ukraine loose.

Germany, of course, is hardly alone. Even if there were enough money to go around, Europe is increasingly not just deindustrialising but demilitarising. Its stores of ammunition and vehicles are increasingly empty, and the idea of military rearmament — that is, creating entirely new military factories and supply chains — at a time when factories are closing down across the continent due to energy shortages and lack of funding is a non-starter. Neither France, the United Kingdom nor even the United States are in a position to maintain the flow of arms to Ukraine. This is a particular concern inside Washington DC, where planners are now trying to juggle the prospect of managing three theatres of war at the same time — in Ukraine, the Middle East and the Pacific — even though US military production is arguably insufficient to comfortably handle one.

And so, in an effort to save face in this impossible situation, Ukraine is now being held solely responsible for doing something it either did not do at all, or only did with the permission, knowledge, and/or support of the broader West. This speaks to the adolescent dynamic that now governs Western foreign policy in a multipolar world: when our impotence is revealed, find someone to blame.

The war in Ukraine, after all, was already supposed to be won, and Russia was supposed to be a rickety gas station incapable of matching the West either economically or militarily. Yet here we are: our own economies are deindustrialising, our military factories have proven completely incapable of handling the strain of a real conflict, and the Americans themselves are now openly admitting that the Russian military remains in a significantly stronger position. Meanwhile, Germany’s economic model is broken, and as its economy falls, it will drag many countries such as Sweden with it, given how dependent they are on exporting to German industrial firms.

10 years ago, during the 2014 Maidan protests, the realist John Mearsheimer caused a lot of controversy when he began warning that the collective West was leading Ukraine down the primrose path, and that our actions would lead to the destruction of the country. Well, here we are. At present, our only saving grace is the continuing offensive in Kursk — a bold offensive that will surely be remembered as a symptom of Ukraine’s increasing desperation.

Indeed, a far better guide of things to come can be found in the fingering of “Volodymyr Z.” as the true culprit behind the Nord Stream sabotage. Here, rather than accept responsibility for the fact that Ukraine was goaded into a war it could not win — mainly because the West vastly overestimated its own ability to fight a real war over the long haul — European geopolitical discourse will take a sharp turn towards a peculiar sort of victim-blaming. No doubt it will be “discovered” that parts of Ukraine’s military consisted of very unsavoury characters waving around Nazi Germany-style emblems, just as it will be “discovered” that journalists have been persecuted by oligarchs and criminals in Kyiv, or that money given by the West has been stolen, and that arms sent have been sold for profit to criminal cartels around the world.

All of these developments will duly be “discovered” by a Western political class that will completely refuse to accept any responsibility for them. Far easier, it seems, to calm one’s nerves with a distorting myth: it’s the Ukrainians’ fault that their country is destroyed; our choices had nothing to do with it; and besides, they were bad people who tricked us!

By Gilbert Doctorow, Website, 8/27/24

In my last appearance on Judging Freedom, Judge Napolitano asked me whether the Ukrainian invasion of the Kursk region would be ended by the time of our next chat, two days from today. The implicit assumption behind this question is that the Russians were doing so well destroying all the NATO-supplied tanks, personnel carriers and other advanced equipment, they were killing and maiming so many Ukrainian troops by their carpet bombing and heavy glide bombing of the region, that none but a rag tag collection of invaders would be left to liquidate or take prisoner in the several days ahead.

This assumption was founded in the confident declarations of my peers in the Opposition or, shall we say, ‘dissident’ movement in the United States. And their certainty, which was reflected in the over-hyped titles given to the recordings of their interviews on youtube came from back channels in Russia that my peers have been using for their public statements.

For example, the very widely watched Scott Ritter revealed in a recent interview that he has been in touch with the commander of the Chechen forces now engaged in Kursk, Alaudinov. Such contact is entirely credible given the fact that Ritter visited Grozny earlier this year, met with the republic’s leader Kadyrov, participated in a review of the Chechen troops and surely met with some of their military chiefs.

Indeed, in view of the seeming consensus that the Russian recovery of Kursk is proceeding apace, with 4,000 of the estimated 12,000 invaders having been killed up to last Thursday, I also foresaw an early end to the conflict, though not necessarily measured in one week. As I explained, the Russian Ministry of Defense only claims territorial gains when it has thoroughly combed the territory and assured itself there are no enemy forces hiding out here or there. The 1,000 square kilometers initially occupied by the Ukrainians are a lot of ground to comb

However, I have had my reasonable doubts about the value of using such back channels as Alaudinov. Back in the days of the battle for Bakhmut, we saw a lot of Alaudinov on the Sixty Minutes news and talk show. Each day presenter Olga Skabeyeva warmly welcomed him on air and he handled himself very well, speaking optimistically of Russia’s progress but giving no specifics that could be of use to the enemy. In short, his lips were sealed. I find it hard to believe that such a professional soldier and patriot would give anything of use to a foreigner, however friendly he or she might be to the Russian cause.

Last night’s edition of the talk show The Great Game gave a very different picture of the state of conflict in Kursk from what my peers are saying and of where this proxy war may be headed NOW, not in some distant future.

See https://rutube.ru/video/f8abcf8a37c43568ef44089025726934/

The key personality in this discussion was Frants Klintsevich, identified on the video as leader of the Russian Union of Veterans of Afghanistan. His Wikipedia entry further informs us that after serving as a Duma member for many years he is now a Senator, i.e., a member of the upper chamber of Russia’s bicameral legislature. He has represented the city administration of Smolensk in the western part of the Russian Federation, where he is no stranger, having been born just across the border in what is now the independent state of Belarus.

For 22 years ending in 1997, Klintsevich was an officer in Russia’s Armed Forces, serving primarily with the parachutists, meaning that he has guts and knows what it means to face battle. He retired with the rank of colonel, but continued his military education in the Military Academy of the General Staff, graduating in 2004. He also has a Ph.D. in psychology and is a gifted linguist, with command of German, Polish, and Belarussian. He is a member of the steering committee of the ruling United Russia party. I bring this out to make the point that Klintsevich is no garden variety ‘talking head’ but a very authoritative source.

And his testimony on The Great Game is the kind of Open Source on which I rely to say what I do about current Russian affairs.

Klintsevich’s commentary last night was intended to sober up the television audience and explain why the fight in Kursk is far more complicated and challenging than anyone is saying either on Russian or on Western news. It suggests that Russian casualties among its armed forces may be far more serious than anyone would suppose.

Klintsevich’s commentary lays the foundation for a dramatic Russian escalation of the proxy war into a hot war threatening to become WWIII. Why? Because the so-called Zelensky gambit in Kursk is fully enabled by the United States and its NATO allies, using skills, satellite and airborne reconnaissance, command and control resources in real time that are superior to anything the Russians possess. It also has Western including U.S. boots on the ground. And in conditions like this, the disadvantaged side faces a strong temptation to go for the great equalizer, nuclear arms, to defend itself and to assure its victory.

Klintsevich also said what I have not seen elsewhere, given the ubiquitous belief in Opposition interviews that the Ukrainians in Kursk are cut off from sources of supply: that Kiev has now raised the number of its forces sent to Kursk from 12,000 to 20,000.

In short, the Zelensky gambit that is being enabled fully by the United States is not a PR stunt but a full-blown invasion intended to be the vanguard of what will be an air assault on Russia’s strategic assets far in the rear using JASSM, Storm Shadow and other long-range missiles launched from F16s.

Klintsevich has further intimated that the two U.S. aircraft carriers and their escorts now in the Eastern Mediterranean may be there not to contain Iran but for an all-out attack on Russia using their jets to deliver nuclear strikes. I add to his analysis that this may explain the knock-out of Russia’s early warning radar stations in the south of the country by Ukrainian drones acting on orders from Washington.

So far, the Russian response to these gathering storm clouds has been two days in succession of massive missile and drone attacks on critical infrastructure in Ukraine. But let us not have any illusions: if the Russians sense that the United States is about to pounce on them, to use the assets in Ukraine and beyond not just against Russian planes, which have been moved back beyond the 900 km range of the JASSM and Storm Shadows, but on critical civilian infrastructure to disable the war effort, then a preventive Russian attack on NATO, on the continental United States. not to mince words, is entirely conceivable.

All of this is sure to play out in the weeks before 4 November and the U.S. elections. The Biden administration is evidently committed to a struggle to the death. Who will flinch? Who will “win” is an open question. Washington, you have been forewarned by Mr. Klintsevich, who is surely speaking on behalf of the Kremlin.

By Andrew Korybko, Substack, 8/20/24

Putin signed a decree on Monday (August 19, 2024) liberalizing his country’s immigration system to facilitate the emigration of Western socio-cultural dissidents who oppose their homelands’ neoliberal ideology. Renowned Russian immigration lawyer Timur Beslangurov, whose excellent services can be solicited from his website, translated the full text in a post on his “Moving To Russia” Telegram channel. He then thanked Duma member Maria Butina for helping to make this “revolutionary” move happen.

That’s not hyperbole either since Russia hitherto had some of the strictest and most byzantine immigration procedures in the world, though only for applicants from outside the former USSR. It was even cautioned in February that “Russia’s Embrace Of Traditional Values-Espousing Immigrants Won’t Be As Simple As Some Think” precisely for that reason. Interested immigrants were advised to learn Russian at a semi-decent level if they wanted any realistic chance of moving there and making a living.   

The new decree changes all of that by removing the language, history, and knowledge of law requirements for applying for temporary residency and even getting rid of the hated quota system. There’ll also be a streamlined procedure for granting three-month single-entry visas. To paraphrase the famous saying, “Russians take a while to saddle up, but when they finally ride, they ride fast.” This development was a long time coming and the result of lots of hard work, but it’s now a reality.

What this means is that anyone who opposes the West’s liberal-globalist socio-cultural policies has the opportunity to start a new life in Russia, though that’ll still of course be easier said than done if they actually decide to come there. They’ll have to have enough money saved up to rent a place or at least a hostel, not to mention to support themselves until they find a job, which is difficult to do until they receive their temporary residency permit.

In the meantime, it would obviously be a good idea for them to take Russian lessons, and some might freelance teaching English (perhaps as a quid pro quo) until they can legally join a teaching company. That, publicly financed media, farming, and specialized tech services are the most likely jobs that Western socio-cultural dissidents will end up having if they move to Russia since options are greatly limited for non-Russian speakers seeing as how few people there speak a foreign language at any level.

It might therefore be an admittedly intimidating and overwhelming experience for the average Westerner who decides to start a new life in Russia, thus leading to only the most passionate ones taking the plunge as well as those without the “baggage” (real estate, dependents, etc.) that could hinder this. Nevertheless, it should come as a huge relief for all of them to know that they still have this opportunity if they ever feel that they can’t comfortably live in their homelands’ liberal-globalist society any longer.

Russia is finally embracing its role as a refuge for them from the aforesaid evils by showing that it sympathizes with their plight, to which end it’s now facilitating their emigration by revolutionizing its byzantine immigration system with long-overdue radical reforms for this promising class of immigrants. Even those like-minded folks who don’t take up this opportunity will still appreciate that they’re always welcome there, which will go a long way towards winning more hearts and minds in the West.

By Ben Aris, Intellinews, 8/18/24

First it was the Americans that ran out of money for Ukraine leading to a disastrous six month hiatus in supplies that allowed Russia to destroy 90% of Ukraine’s non-nuclear electricity generation capacity. Now it is the Germans turn: Berlin has frozen all additional military aid to Ukraine due to budget constraints, the Frankfurter Allgemeine Zeitung (FAZ) reported on August 18.

The decision, backed by Chancellor Olaf Scholz, was ordered by Finance Minister Christian Lindner and limits new funding for Ukraine’s military needs to aid packages that have already been announced. No additional funds will be allocated for the coming years, despite ongoing military conflicts in Ukraine.

Bankova (Ukraine’s equivalent of the Kremlin) quickly posted a message on social media saying that financial aid to Ukraine by Germany would not be suspended.

Some commentators have pointed out that the final decision lies with Bundesrat, the parliament, which has not yet made a decision. It already approved additional funds last year, contrary to the government’s draft budget, so a work around may still be found.

However, recent revelations that a Ukrainian diving instructor was behind the destruction of the Nord Stream 1&2 gas pipelines that belonged to Germany and was the major source of energy to the country, may complicate matters. German prosecutors have issued a warrant for his arrest, but, with Polish complicity, he fled to Ukraine.

Ukraine has been worried that the mounting Ukraine fatigue will reduce the support it gets from its Western allies. Eventually the US passed a new $61bn aid package on April 20, but that package is widely seen as the last big financial package the US will contribute to the war effort.

The EU also approved a four-year €50bn support package in February and is taking over as Ukraine’s main source of funds. In addition, a $50bn loan agreed by the G7 countries in July that will be serviced by interest payments from the $300bn of frozen Central Bank of Russia (CBR) reserves was approved, but as bne IntelliNews reported Ukraine is running out of men, money and materiel and the loan money is not expected until the autumn at the earliest.

This year the Ukrainian budget calls for a record $43bn deficit, but there is already a $12bn hole that needs to be filled, and the government is mulling making spending cuts, raising taxes and, as a last resource, turning the printing presses back on to cover the shortfall. Moreover, the outlook is for the situation to get worse; Ministry of Finance (MinFin) forecasts it will receive some $37bn this year from international donors, increasingly in the form of loans, but that will fall to $19bn by 2026.

Ukraine has already technically defaulted on its outstanding Eurobonds, after it was unable to start repayments at the start of August and was forced to restructure the debt, giving investors a 60% haircut, but offering them potentially lucrative GDP warrants as compensation. Under the deal some of the world’s biggest investors, including BlackRock, Amundi and Amia Capital, will write off a large part of $23.4bn by exchanging their bonds for new ones that will have maturities of as much as 12 years.

 Germany’s decision comes at the worst time for Ukraine, which is slowly losing ground to the advancing Armed Forces of Russia (ARR) on the frontline inside Ukraine, but has also launched a bold attack on Russian soil in the Battle for Kursk and needs more money and arms than ever.

In a letter obtained by FAZ, Lindner outlined that future aid to Ukraine should be financed through the $50bn package recently agreed upon by the G7. However, the $50bn loan remains bogged down in wrangling over how the money will be distributed by the contributing countries and German has objected to participating saying that it has already contributed €37bn to Ukraine’s war budget and points out it is already the biggest contributor to the four-year €50bn package agreed at the start of this year.

One immediate impact of the decision is the inability to finance an IRIS-T fire unit that had been offered for immediate delivery by Germany’s Diehl Defence. The unit became available after another customer opted to defer their delivery to aid Ukraine following a devastating Russian missile attack on a children’s hospital in Kyiv in July. Despite the urgency, the funds were not approved, against the wishes of Defence Minister Boris Pistorius, but Norway has stepped in to provide the system.

The freeze on new military aid has reportedly led to significant tensions within the German government. Ministries led by Defence Minister Pistorius, Foreign Minister Annalena Baerbock, and Vice Chancellor and Minister for Economic Affairs Robert Habeck were strongly opposed to the lockdown. Sources told FAZ there was a major dispute within the government following the announcement.

FAZ reported that the funds for military aid in 2024 have already been fully allocated, with the planned €4bn for 2025 already overbooked.

The Federal Government itself has denied the FAZ report. The only reason aid to Ukraine was capped at €4bn in the budget is because there will be additional aid from another budget, the Chancellery said.

There was also no comment on how many weapons were currently being delivered, as this is usually only announced once the weapons, tanks and air defence systems have arrived in Ukraine .

The financial planning for subsequent years looks grim, with only €3bn earmarked for 2026 and a mere €500mn for both 2027 and 2028. Unless new money is found, the financial outlook for Ukraine is grim and that no new military aid pledges to Ukraine will be possible in the near future.

As a result, the $50bn G7 loan becomes a crucial source of funding for Kyiv.

Behind Germany’s budget problem is the November 15, ruling by the Federal Constitutional Court, which declared the second supplementary budget unconstitutional. The federal government had earmarked structural EU funds that it intended to use for the green transition, but the court ruled that the €60bn in question could not be reassigned under Germany’s so-called debt-brake rules, leaving a significant hole in the budget plans.

The federal government and the 16 federal states are obliged to balance their books, making taking out new loans very difficult. No other G7 country has such strict limits on new borrowing and the rules are enshrined in the German constitution. The debt brake became legally binding for the federal government in 2016 and for the states in 2020. Federal Finance Minister Wolfgang Schäuble (CDU) was then able to present the first “black zero” balanced budget in 45 years in 2014. The only wiggle room the federal government has – regions have none — is it is allowed to borrow up to a maximum of 0.35% of GDP, or around €13bn in additional debt.

The debt brake can be suspended, “for natural disasters or unusual emergency situations beyond governmental control and substantially harmful to the state’s financial capacity,” categories the war in Ukraine do not fall into.