New Rules for a New Cold War

As part of my role on the U.S. Olympic Committee (USOC) board of directors, Pauline and I recently attended the Sochi Olympics. For all of the concerns and issues leading up to the games, our experience at the 2014 Winter Olympics was quite positive. The logistics and transportation all worked well, our hotel had its idiosyncrasies but was quite nice, and security was tight but largely unobtrusive. Most importantly, and as is often the case once the Games start, the athletes stole the show – and demonstrated once again the power of sport to overcome differences and elevate the human spirit.

At the same time, there was something disquieting about the huge cost overruns at the Sochi Games and the social implications of the way all of this was created – somehow an expensive $12 billion event ended up costing $50 billion. I was left wondering if an economically underdeveloped country should spend $50 billion creating a venue essentially from scratch whose future economic value is suspect at best? Should the world implicitly endorse the contract labor process that was used to perform the work? Taking an alternative point of view, is it really our place to judge? All of this was swirling through my mind as we left Sochi – soon to be followed by the reality of the Crimean takeover and the violence and unrest in eastern Ukraine.
The question I asked myself was this: “As a responsible American citizen, what should I expect from our government in this environment and what role should the US play in this on-going situation?”

Before actually delving into this, it’s useful to declare some strong beliefs – and if you disagree with these, then let’s have that discussion first.

  1. The US should no longer be the world’s police force or peace manager. Certainly as a large economy and a prosperous nation, we have interests and obligations that extend beyond our borders, but acting as if we have some authority in this area is both practically unrealistic and morally bankrupt.
  2. Our hands are hardly clean – there are a long list of questionable US activities around the world that rightly stir anti-American sentiment, our adventures in Iraq being only the most recent example. My point is not to besmirch the United States – in fact, I’m a proud American, but just to point out that we are not blameless in our world interactions.
  3. The situation in the Ukraine itself, is mostly a European problem that European countries should address. The fact that Europe is largely disorganized and unable to act in even a moderately unified fashion on issues like this should not really be our problem.
  4. No amount of revisionist history justifies what has occurred in the Ukraine. You can claim that Crimea was rightly Russian based on historical precedent (and population), but that doesn’t justify what was effectively a well-executed invasion of a sovereign country. The thin veil of pretense around this makes it all the more galling.

With all of that said, history teaches us that leaders like Vladimir Putin will ignore the norms and niceties of international law (or make it up as needed) until someone says “no” – and sometimes many denials are required. The comparisons to Hitler here are well-founded and should not be forgotten. When nobody has said “no”, the outcome has never been good.

The problem, of course, is how to say “no”. America certainly has no desire for a military engagement, especially with the Russians, and I’m sure the rest of Europe feels the same way. In fact, as Putin’s tactics are demonstrating, a traditional military conflict is somewhat of an anachronism in this context. Since the Ukraine is not part of NATO or the EU, there is no political necessity to pursue this type of conflict in any event. With that said, there are other countries in the region like Poland and the Baltic countries that are NATO and EU members so the possibility of military escalation is there if something isn’t done in the Ukraine to change the dynamics.

The real power to be exercised here is economic – an area where Europe and the United States have a distinct advantage. The Russian economy is highly dependent on natural resource prices and demand – beyond that it is not well developed. A thoughtfully executed set of sanctions and financial restrictions on Russian banking assets would put pressure on Putin and the government. Such sanctions would need to be steadily ratcheted up over time and would have to be coordinated between the Germany, the UK, and the United States in particular. In fact, for reasons that are hopefully obvious, this entire effort should originate in and be led by European leaders.

This approach is not a quick fix, nor is it without its costs – Europe is dependent on Russian natural gas amongst other things so there would be some economic pain felt as a result of sanctions. But it is far preferable to any military action and given a bit of time, likely meaningfully more effective. Any short-term cost is highly preferable to the significantly higher price associated with dealing with an expansionist Russian regime that creates on-going instability across eastern Europe. As history teaches us, maintaining sovereign equilibrium is very important, and once lost, it is very expensive and time consuming to regain. The Obama administration has been moving down this policy path – but the time is “now” for European leadership on this important issue.