The Wake-Up Call: Europe Toughens Stance against Putin


A column of hearses leaves an airbase in Eindhoven, The Netherlands, carrying the bodies of victims of the Malaysia Airlines crash. Zoom

A column of hearses leaves an airbase in Eindhoven, The Netherlands, carrying the bodies of victims of the Malaysia Airlines crash.

It took the shooting down of a Boeing jet carrying almost 300 people before the EU agreed on the first true economic sanctions against Russia. The Americans want further action, but it is impossible to know if punitive measures can sway Vladimir Putin.

It was the images. Absurdly tattooed pro-Russian fighters, cigarettes dangling from their lips and Kalashnikovs tucked under their arms, stomping around in the field of bodies and wreckage at the crash site, as if the dead children from the downed Boeing had nothing to do with them. Experts holding their noses as they opened a railroad car full of dead bodies. A seemingly endless convoy of hearses leaving Eindhoven Airport in the Netherlands. And Russian President Vladimir Putin took it all in without losing his composure.

It's usually the images.

It's part of the occasionally cynical business of political experts to refer to a tragedy of this magnitude, and to the endlessly repeated TV images of the suffering of innocent people, as a "game changer." It's the moment that divides the course of a crisis into "before" and "after" -- a time when the public and politicians hold their breaths and take a new look at the situation. But one of the unique features of the European Union is that in the "after" period, it often continues for a time to behave the way it did in the "before" period. Supporting evidence was provided by an exchange from last Tuesday, almost a week after Malaysian Airlines flight MH 17 was shot down:

Let's at least do an arms embargo, argued British Foreign Secretary Philip Hammond.

No, you can't even do financial sanctions, responded his French counterpart Laurent Fabius in the hearing room of the European Council building in Brussels.

Prior to the meeting, EU foreign ministers had seemed deeply disconcerted. But behind closed doors, the overriding objective was apparently not to determine how best to force Putin to back down, but how best to protect their own domestic economies.

'Simply Ridiculous"

In the days following, senior representatives of Eastern European member states voiced doubts about their smug cousins from the EU's western member states. It is "simply ridiculous," one representative said.

But by the end of the week, Europe had finally arrived in the "after" phase. The "game changer" had had its effect. It is now all but certain that flight MH 17 was shot down by a surface-to-air missile system from Russian inventories, a system that hardly would have reached Ukraine without Putin's approval. The 28 EU ambassadors agreed in principle on initial tough economic sanctions against Russia, which they plan to wrap up on Tuesday. In a letter to European leaders, European Council President Herman Van Rompuy wrote: ""I would like to ask you that you instruct your ambassador to complete an agreement by Tuesday." Unless the EU abandons its resolve once again, "we can now pull the plug on Russia and Putin in a very controlled manner," say officials in Berlin.

Russian President Vladimir Putin has so far resisted Western attempts to force him to abandon support of pro-Russian separatists in eastern Ukraine. Zoom

Russian President Vladimir Putin has so far resisted Western attempts to force him to abandon support of pro-Russian separatists in eastern Ukraine.

European leaders are expected to officially approve the new sanctions against Russian banks, companies and private citizens by the end of this week. Despite the summer break, the German government is hoping for a special summit in Brussels. The EU message to Putin, after all, must also be accompanied by images -- symbolism strong enough to be worthy of the pictures from the MH 17 crash site.

In practical terms, the sanctions revolve around oil, natural gas, weapons, high tech and a lot of money. If it weren't for the reality of the war in eastern Ukraine, where people are dying every day, the latest European offensive would be dubbed an "economic war."

Is this the way to stop Putin? And how will he respond?

The EU wants the Russian president to promptly close the border with Ukraine and cut off supplies to the separatists. It also wants Putin to disarm the separatists, recognize the Ukrainian government and guarantee freedom of movement for OSCE observers. The German Foreign Ministry wants even more: a UN police mission with a clearly defined mandate and time frame, to investigate the crash of flight MH 17. "Talks to that effect are already underway with our Dutch and Australian partners," say German Foreign Ministry officials. This would require a resolution in the UN Security Council, to which Putin would have to agree.

Staying the Course

It would be a first test to see if the Europeans' newfound courage has made an impression on the Russian president.

As Western agencies did during the Cold War, the Bundesnachrichtendienst (BND), Germany's foreign intelligence agency, is now trying to figure out what Putin's advisors are telling him. There are signs that Kremlin hardliners and business leaders are locked in a fierce battle for the upper hand. In contrast to what Western intelligence services believed at the beginning of the Ukraine crisis, cracks now appear to be forming in Putin's power structure. This, at least, was reported by the head of the BND, Gerhard Schindler, in a recent meeting of the Foreign Affairs Committee in German parliament, the Bundestag. He delivered a similar report in the Chancellery a short time later, during the weekly intelligence briefing, sources say. BND officials believe that it is quite possible that some Russian oligarchs will soon place economic interests above the political and try to get Putin to change course.

Sergey Glazyev, 53, is one of the most influential hardliners who want Putin to stay the course. Glazyev is responsible for relations with Ukraine and the Eurasian Economic Community in the Kremlin.

Glazyev calls Ukrainian President Petro Poroshenko a "Nazi" and is also calling for airstrikes against Ukrainian troops. He views Europe as degenerate, and the United States as an enemy that is secretly printing enough money to enable it to buy up or ruin Russia. As a consequence, Glazyev wants to seal off his country and make it self-sufficient in key areas. For Putin confidants like Glazyev, EU sanctions are the perfect trigger for such a renunciation of the Western world. If Glazyev had his way, Moscow would cease holding its $472 billion (€351 billion) in foreign currency reserves in US dollars or euros, would replace Visa and MasterCard with "Eurasian credit cards," and would replace Europe with China as Russia's most important partner.

Already, Russian civil servants and politicians are no longer permitted to have bank accounts and own companies or houses abroad, and 4 million police officers, military officials and intelligence agents are not allowed to vacation in the West. In the future, all Russian government employees will be required to drive official cars made in Russia.

A world is taking shape that mirrors Putin's weltanschauung. It is a world in which Russia, supposedly humiliated by the West, regains its old glory.

Pushing Putin into a Corner

Moscow political scientist Stanislav Belkovsky is reminded of Putin's interview-based biography "First Person," published in 2000. In it, the president says: "You should never drive a rat into a corner." And because one shouldn't apply pressure to Putin, who is not a flexible person, says Belkovsky, "we can expect all kinds of aggressive decisions from him now."

So far, Putin has avoided direct military intervention in Ukraine. But according to Western intelligence information, Russia moved heavy military equipment across the three border crossings rebels captured during the recent ceasefire declared by the Ukrainian government in Kiev. And by acquiring anti-aircraft missiles, the separatists have offset the Ukrainian army's biggest military advantage, its air superiority. More than a dozen aircraft have already been shot down.

Since the shooting down of MH 17, Putin has lost any political capital he still had in Europe and the US. And with nothing left to lose, it seems likely that he is approaching tougher sanctions with sanguinity.

Eckhard Cordes, the chairman of the Committee on Eastern European Economic Relations, an organization representing German business interests in Russia, agrees. "In the current situation, too much external pressure can achieve the opposite of what is intended. It does no one any good if we completely force Putin into a corner." Indeed, such a prospect alarms quite a few people in the Russian economy. Oligarchs may be concerned about their billions and their villas in Cyprus, on the Côte d'Azur and in London. But they also know that without machinery and know-how from the West, the Russian economy is doomed.

Of the very few people who have dared to say this openly, one is former Finance Minister Alexei Kudrin, a liberal. According to his calculations, rearmament, military intervention in eastern Ukraine and sanctions could cost Russia up to 20 percent of its economic strength within a few years. Former Russian Prime Minister Mikhail Kasyanov was even blunter: "If sanctions were imposed against the entire Russian financial sector, our economy would collapse in six weeks."

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Graphic: Russia's economic clout in Europe. Zoom

Graphic: Russia's economic clout in Europe.

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