April 21, 2022: The war in Ukraine is turning into a major political and economic, as well as military event. While deaths and injuries are lower than previous conflicts of similar size, the Ukraine conflict has brought about a lot of economic changes that were not expected, as well as some that were.

The current fighting may go on for another year or more, but the economic costs are more likely to cause Russia to quit sooner because the Russian military effort is costing billions of dollars a day and on some days, this has gone over $10 billion. Part of this cost is the unexpectedly heavy economic sanctions that have not only imposed high costs but have fundamentally changed Russian trading relations for the worse. Russia has to rebuild its natural gas pipeline system to reflect the many lost customers and more distant new ones. Russia lost access to the major global banking systems and has to rely on a new, improvised one that means Russia pays more for imports and receives less for exports. The economic sanctions also involved freezing financial assets outside Russia. Many of these assets are threatened with seizure and transfer to Ukraine as reparations for the damage Russian bombs, artillery and missiles have done to cities and infrastructure.

Russian military operations have largely been unsuccessful, except for the amount of damage done. There have been less than 50,000 killed so far, most of them Russian soldiers and most Ukrainians killed have been civilians. Russia avoided killing civilians initially because the Russians believed that most Ukrainians would welcome them as liberators. That was a major error because the reality was that Ukraine was united to oppose the Russian invasion and, once this sunk in, the Russians switched most of their air and artillery attacks to urban areas. Not many of these bombed areas were captured but in the few that were Russia treated all the local civilians as prisoners of war until the civilians could convince the Russians otherwise. Those determined to be dangerous to the occupation were put under guard in makeshift prisons and many were compelled to do manual labor for the Russians. One Ukrainian realized that the Russian were actually enacting these occupation plans, and Ukrainian civilians in areas that might be captured were advised to flee.

Back in Russia there are complaints about these occupation plans, either because the government has been slow to implement them quickly enough or criticism from many Russians who see this as no different than what the Nazis did in Russia during World War II. Back then the Soviet Union was still intact and Ukraine was a subordinate part of the union while the Russians gave the orders. That was why half the population of the Soviet Union chose to leave the union in 1991 and become separate countries. Russians were surprised that even Slavic Belarus and Ukraine left and don’t want to come back. Russia’s current leaders believe the dissolution of the Soviet Union was a major error that should be rectified. There were no willing returnees so Ukraine was chosen to be first to be compelled to return.

This was the strategy that Russia’s current leader, former KGB officer Vladimir Putin developed over the last two decades. He had earlier been elected to office but used that to expand the power of the president and make it possible for him to become president-for-life or until he angered too many powerful Russians and was purged. Putin thought he was purge-proof but due to mistakes he, and many of his key subordinates made, the Ukraine reunification “operation” turned into a disaster, especially for Putin. This was unexpected because early on in his presidency Putin eliminated most of the independent media and made it illegal to openly report on or discuss his less savory deeds, like corruption and getting Russian soldiers killed in foreign wars. Many rural Russians, whose main source of news is state-controlled media, still believe the Putin version of the Ukrainian “operation”. Maintaining that illusions becomes more difficult as more Russian soldiers die in Ukraine and their families are not notified or, if they are, the cause was described as anything but fighting Ukrainians defending their homeland. The worsening economy is impossible to hide but for the moment the official explanation is an unwarranted attack by the West, especially NATO nations, which have long been accused of actively seeking to destroy Russia.

Russian troops in Ukraine or headed there have a more realistic view of what is going on and are refusing to fight or even enter Ukraine. Conscripts point out that Russian law prohibits conscripts from being sent to a foreign war. Military leaders insist that Ukraine belongs to Russia and there is not a war there but a “special operation”. Conscripts respond that the law also specified that only special operations troops, and never conscripts, will deal with special operations.

Many army commanders are in trouble for corruption as the deployment of their units to Ukraine revealed that many battalions contained fewer troops than commanders reported. In some battalions only half the troops the government was paying for were present. This was classic “ghost soldier” corruption in which commanders make extra cash by letting troops, especially conscripts, go if they can pay an exit fee and keep quiet about how they got out. This works until the battalion is ordered into a combat zone and cannot account for the missing troops. These units were sent in anyway and when the survivors got back to Russia they openly refused to retrain, rearm and return to Ukraine. Threats of punishment did not work because most of these men saw returning to Ukraine as a death sentence.

Ghost Soldiers were not the only corrupt practice exposed by the Ukraine fighting. Lots of money meant for vehicle maintenance or building the vehicles correctly had been stolen so these vehicles failed when they entered combat. Shoddy manufacturing meant nearly half the missiles, rockets and shells did not work. That was great for those plundering the munitions budget, and for Ukrainians being fired at. The Ukrainians do have to deal with all those unexploded objects on the ground or inside wrecked buildings. Putin has responded to all this by firing or arresting several hundred military, intelligence or procurement officials. The arrests continue and Putin is trying to gather new staff he can rely on for an accurate picture of what is going on in Russia, Ukraine and elsewhere.

All these changes are expensive, mainly for Russia. Meanwhile Ukrainians prepare for continued fighting and make preparations for driving the Russians out of Ukraine, including territory (Crimea and portions of two east Ukraine provinces) that was seized in 2014, after which Russia accepted a truce. Russia has been violating that truce ever since and now find themselves desperately trying to hold on to portions of Ukraine they occupy while Ukraine receives billions in military aid from NATO nations as well as other countries worldwide. Ukraine is also buying some new weapons and the Russians cannot halt this or the delivery of new weapons to Ukrainian forces. The Russian plan to conquer Ukraine in fifteen days turned into a nightmare situation that gets worse for Russia with each passing day.

To darken this situation a bit more, Putin threatens to use nuclear weapons rather than admit defeat in Ukraine. This has generated a lot of criticism inside Russia. For most Russians, paying for Putin’s mistakes are one thing but the possibility of a nuclear war is a misjudgment too far.