I think if Russia are given a free hand to dissect Ukraine we are in a very different and more dangerous world.  I'm sure the US understand this, as the only grown-up in the western camp.  The EU will want to appease Russia if they can get away with it, because right now they have enough problems of their own, and any problems with gas supply and Russian investment in Europe will compound that. But Russia is also dependent upon these revenues, and places to offshore their spoils.  

We know Putin runs a basically old style dictatorship, a legacy of the KGB + new capitalists.  He wants Russia's dignity and superpower status back, but he only understands this in strong-man terms, like all dictators.  In that sense he is no different from Mugabe. The Ukraine, having been Russian for most of modern history, is probably a red line (like Georgia), as its 'back yard'.  But Putin's recent interest in demonstrating in both the US and UK 'back yards' - the Firth of Forth carrier incident and the bombers to Venezuela - suggests that he wants to begin a process of being taken seriously not as a partner but as a capable adversary.  

The answer is probably new elections and a referendum for the Crimea and Eastern Ukraine.  But to get these will require some deft footwork by the US and the EU.  China will support Russia for two reasons - Tibet (and the recent Obama-Lama-Ding-Dong) and their own claims in the south China sea. Any diversion of US strategic interest back towards Europe will open up a route for China to press those claims more purposefully.  

This is dangerous, and Europe in particular is very unprepared to stand up to Russia, with the US having shifted is centre of gravity towards the Pacific and gone through its own military draw-down.  As Korea signaled the end of post-WW2 disarmament, one might see this crisis as a test of whether the post-2008/Afghanistan cutbacks in western military force will be reversed.  They should be.  On a more positive note both the European and Us economies are in better shape, and apart from gas have little dependence upon trade with Russia (apart from Cyprus). Fracking in the US has freed up middle east oil and gas, and hopefully this little spat will make shale gas a more urgent priority in Europe (although geological conditions make it less of a winner here than in the US). A lot of new African oil and gas is also coming online, so we can survive without Russia, even if it will be temporarily painful.

The worst outcomes are either 1). A Russian coup de main, which will lead to a new cold war, and possibly embolden Russia to have another pop at Georgia 2) a civil war, which will lead to another Bosnia on steroids and potentially destabilize Eastern Europe, 3) any attempt by China to take advantage of US preoccupation in Ukraine.
 


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