TIME Innovation

Five Best Ideas of the Day: December 18

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. By breaking with the Cuba lobby, President Obama could massively disrupt American interest group politics.

By Noah Feldman in the Salt Lake Tribune

2. Sony can take a stand against the hackers whose threats have forced them to pull “The Interview” by giving the movie away online.

By Bryan Bishop in the Verge

3. Could the West help save the ruble without throwing Putin a lifeline?

By Juliet Johnson in the Globe and Mail

4. By tracking rising global temperatures, satellites can predict cholera risk.

By Dr. Kiki Sanford in BoingBoing

5. After the Taliban’s shocking attack on a school in Pakistan, the military there understands “the Frankenstein that it helped to create must now be killed.”

By Peter Bergen at CNN

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

TIME russia

Putin Shows Stick to West, Carrot to Oligarchs, and Heart to ‘Someone’

Kremlin leader deflects criticism for crisis away from government, central bank and, most of all, himself–and on to his favorite enemy.

Russian President Vladimir Putin defended his officials, appeased local oligarchs and, of course, railed at the West Thursday as he faced journalists for the first time since the ruble went into free-fall last week.

Russia’s most eligible divorcee also managed to break hearts from Vladivostok to Kaliningrad by saying he’s in love again, although he was coy about the identity of the lucky lady.

In a statement that sent sighs of relief around the corridors of power in Moscow, Putin shielded his government and central bank from criticism, saying that the crisis “has of course been caused by external factors first and foremost.”

“The central bank and government are acting adequately and correctly,” Putin said, although he added that “some decisions could have been taken more quickly.”

He acknowledged that it could take “up to two years” for the Russian economy to return to growth as a result of the crisis.

After doing a passable imitation of a deer stuck in the headlights for most of the last week, the Russian central bank yesterday announced a suite of measures to prop up the banking sector and allow its large stash of foreign reserves to be used, indirectly, to help companies repay their foreign debts. At the same time, local reports suggest the government pressured biggest businesses into bringing more of their export earnings back to Russia.

As a result, the ruble is now up nearly 25% from its low on “Black Tuesday” when the dollar briefly bought 80 rubles for the first time ever. But it’s still down 50% this year, and it weakened again after Putin spurned a number of opportunities to sound a conciliatory note on Ukraine, the issue that caused the U.S. and E.U. to impose sanctions on Russia’s largest banks and oil companies.

Putin said that “25%-30%” of the problems currently facing Russia were due to the sanctions, which he again attacked in a characteristically defiant and bitter tone. In one vivid extended metaphor, he said the West wanted “to chain the Bear,” de-claw it and saw off its teeth, unless it sat quietly eating berries in the forest.

But beyond the usual rhetoric, there was little hard news in a three-hour press conference that was, as usual, more a series of well-rehearsed lectures than a genuine question-and-answer session.

The most dramatic development was Putin’s announcement that the tycoon Vladimir Evtushenkov, head of the conglomerate AFK Sistema, would be invited along with other businessmen to a meeting to discuss further measures on overcoming the crisis.

Evtushenkov has been under house arrest for over a month since a court seized Sistema’s oil company, OAO Bashneft, on allegations that it had been privatized corruptly. The incident had sent shock waves through Russian business circles, and Putin stressed Thursday that there were no plans to take back any other businesses.

Sistema’s depositary receipts shares doubled by lunchtime in London to $4.61–but they’re still down 80% since last August.

This post originally appeared on Fortune.com

TIME russia

Google Is Now Worth More Than the Entire Russian Stock Market

Google joins an elite list of companies, including Exxon Mobile, Microsoft and Apple

Google is now more valuable than the entire Russian stock market. Russia’s stock market is now worth $325 billion while Google is valued at more than $340 billion, according to Bloomberg.

The news comes as Russia’s currency, the ruble, continues to stumble under pressure from declining oil prices and western sanctions. Russia’s gold reserves have also declined to their lowest point since 2009.

Google joins an elite list of companies, including Exxon Mobile, Microsoft and Apple, worth more than the entire Russian market.

Read next: Leaked Sony Emails Reveal How Much Movie Studios Hate Google

TIME russia

Putin Accuses the West of Trying to Sideline Russia

Russian President Putin gestures during his annual end-of-year news conference in Moscow
Russian President Vladimir Putin gestures during his annual end-of-year news conference in Moscow, Dec. 18, 2014. Maxim Zmeyev—Reuters

He says Western sanctions are a factor in Russian economic crisis

MOSCOW — Russian President Vladimir Putin vowed Thursday to fix Russia’s economic woes within two years, pledging to diversify the gas-dependent economy and persuade businesses to help prop up the collapsing ruble.

While using a litany of accusations against the West, Putin acknowledged that Western economic sanctions over Russia’s course on Ukraine was just one factor behind the Russian economic crisis, saying a key reason was the nation’s failure to ease its overwhelming dependence on oil and gas exports. He estimated that sanctions accounted roughly for 25 to 30 percent of the ruble’s troubles.

As Putin spoke, the Russian currency was trading around 62 rubles a dollar, slightly lower than last night but up 12 percent after plummeting to historic low of 80 earlier in the week. Russia’s benchmark MICEX index rallied by 5.5 percent by midday Thursday.

Speaking with strong emotion, Putin sought to soothe market fears that the government could use administrative controls, such as obliging exporters to sell their currency earnings, to help stabilize the ruble.

He accused the West of trying to infringe on Russia’s sovereignty, adding that the Ukrainian crisis was just a pretext for Western action.

Putin struck a defiant note against America and the European Union, saying that sanctions slapped against Russia after it seized the Black Sea region of Crimea in March were part of a historical campaign to weaken Russia.

“Sometimes I think, maybe they’ll let the bear eat berries and honey in the forest, maybe they will leave it in peace,” said Putin, referring to Russia’s famed symbol. “They will not. Because they will always try to put him on a chain, and as soon as they succeed in doing so they tear out his fangs and his claws.”

He spelled out his metaphor, saying that by fangs and claws he means Russia’s nuclear weapons.

“Once they’ve taken out his claws and his fangs, then the bear is no longer necessary. He’ll become a stuffed animal,” he said. “The issue is not Crimea, the issue is that we are protecting our sovereignty and our right to exist”

Despite his tough anti-Western rhetoric, Putin spoke in support for political solution of the crisis in Ukraine, where pro-Russian insurgents have been battling Ukrainian government troops since April, leaving 4,700 people dead.

Putin said Ukraine must remain one political entity, meaning that the rebellious eastern regions should remain its integral part. He also suggested that the Ukrainian government and pro-Russian rebels in eastern Ukraine should conduct a quick “all for all” prisoners swap before Christmas.

Putin added that he feels sure that Ukrainian President Petro Poroshenko sincerely wants a peaceful solution to the crisis but other forces in Ukraine don’t.

Putin urged the Ukrainian government to fulfill its end of a peace deal reached in September and grant amnesty to the rebels and offer broad rights to residents of the country’s east.

Putin also held out hope for normalizing ties with the West, saying that Russia still hopes to expand its gas supplies to southern Europe using a prospective gas hub on Turkey’s border with Greece.

TIME

The Most Powerful Protest Photos of 2014

There wasn't a corner of the planet untouched by protest this year, from the tear-gassed streets of Ferguson to the student camps of Hong Kong

In 2011, TIME named the Protester as the Person of the Year, in recognition of the twin people-power earthquakes of the Arab Spring and Occupy Wall Street. TIME named the Ebola Fighters as the 2014 Person of the Year, but you could have forgiven if we went back to the Protester. There wasn’t a corner of the planet untouched by protest this year, from the tear-gassed streets of Ferguson, Missouri, to the squares of Mexico City, to the impromptu student camps of Hong Kong. Many of the protests were remarkably peaceful, like Occupy Hong Kong, which was galvanized by public anger over the overreaction of the city’s police. Others turned bloody, like the Euromaidan protests in Kiev, Ukraine, which eventually brought down the government of pro-Russian Ukrainian President Viktor Yanukovych, in turn triggering a war that led to the annexation of Crimea by Russia, the downing of Malaysia Airlines Flight 17 in May and the deaths of thousands of Ukrainians.

Not every protest was as effective as those that began the year in the cold of Kiev. Hong Kongers still don’t have full democratic rights, gay rights are on the retreat in much of east Africa and every day seems to bring news of another questionable police killing in the U.S. But the wave of social action that ended 2014 is unlikely to crest in 2015. The ubiquity of camera phones means no shortage of iconic photographs and videos from any protest, whether in Lima or Los Angeles, and social media gives everyone the means to broadcast. What follows are some of the most powerful images from the global streets in 2014.

TIME russia

Apple Stops Online Sales in Russia As Ruble Plunges

People wait to exchange their currency as signs advertise the exchange rates at a currency exchange office in Moscow, Dec. 16, 2014.
People wait to exchange their currency as signs advertise the exchange rates at a currency exchange office in Moscow, Dec. 16, 2014. Alexander Zemlianichenko—AP

The tech giant fears the currency is too volatile

Apple halted online sales of its iPhones, iPads and other products in Russia after this week’s “extreme” ruble fluctuations. The Russian currency lost over 20% this week and bonds and stocks also tumbled.

“Our online store in Russia is currently unavailable while we review pricing,” wrote Alan Hely, an Apple spokesman, in an email to Bloomberg.

Apple had earlier tried to deal with the fluctuations by increasing its prices in Russia by about 25%. Apple doesn’t have any of its own stores in the country, so the online store is its main outlet for Russian consumers. But now with the ruble’s value at an all-time low, Apple believes the currency is too volatile to set prices.

[Bloomberg]

Read more: Putin watches Russian economy collapse along with his empire

TIME russia

Putin Watches Russian Economy Collapse Along With His Stature

The plummeting ruble may force the Russian President to rethink his adventures abroad

Stability was always the watchword of Vladimir Putin’s presidency, and for more than a decade it rang true. Ever since he came to power in 2000, Putin presented himself as the antidote to what Russians call the “wild ’90s,” the decade of economic upheaval that culminated in the crash of 1998. The high price of oil, and the fortunes it brought the Russian petrostate, have since allowed Putin to keep his promise of prosperity and economic growth. But this week the myth of Putin the Stabilizer collapsed, along with the value of the national currency.

Driven down by a six-month plunge in the price of oil, the ruble lost about a quarter of its value against the dollar in the first two days of this week, its steepest fall since the crash of 1998, when Russia defaulted on its debt. The central bank took drastic measures to avoid the risk of another default on Monday night, hiking interest rates from 10.5% to 17% in a desperate attempt to make Russians keep their rubles in the bank instead of spending them on foreign currency. But it came too late. The rate hike, also the steepest since 1998, only managed to forestall the collapse of the ruble for about 10 minutes when markets opened on Tuesday morning.

Putin, meanwhile, kept his head in the sand. Reporters who called his spokesman with questions about the ruble’s fall were told to call the Prime Minister or the Cabinet, as though the economy was not the President’s concern. The most notable item on the Kremlin’s website on Tuesday was a presidential order to prepare a “fundamental” history of the region of Crimea, which Putin annexed from Ukraine this spring. Though it was hardly a tonic for the national economy, this decree hinted at Putin’s plan for riding out the storm.

The annexation of Crimea, which drove Putin’s approval ratings to record highs this year, is still the main pillar propping up his popularity. But that is not likely to remain the case, according to Lev Gudkov, head of Russia’s leading independent pollster, the Levada Center. “The more people are connected to the market economy, the more critical they are of the rhetoric and demagoguery of our President,” Gudkov wrote in an analysis published on Tuesday. By spring, he predicted, public discontent would reach down to the poorest and least educated segments of the population, as economic realities they see all around them stand in ever starker contrast to the rosy picture presented on Russian state TV.

The government admitted as much on Tuesday. “We are ending the year with 15.7 million poor people nationwide,” said Olga Golodets, the Deputy Prime Minister in charge of social affairs. “And in the context of inflation their numbers will inevitably grow, especially among families with children,” she told a meeting of officials and social workers.

That’s a startling prospect for a nation that has seen a steady decline in the poverty rate since Putin came to power. But when the Cabinet held an emergency meeting on Tuesday to discuss the ruble crisis, the ministers failed to come up with any concrete measures to prevent the economy from sinking into a deep depression next year. Already there is talk of Russia being forced to introduce capital controls, or imposing restrictions on foreign trading to make it harder to sell off rubles. That might be enough to save the economy, but it would damage domestic firms and outrage the business elites who have been among Putin’s closest supporters.

MORE: Gorbachev Blames the U.S. for Provoking ‘New Cold War’

As the recession takes hold, the state’s most reliable means of deflecting public outrage will, as usual, involve blaming the West. So far pro-Kremlin news outlets have tended to avoid blaming the fall in the oil price on some kind of American conspiracy, but Putin will be tempted to offer the public such fables as the economy continues to sink. “This is the only answer,” says Kirill Petrov, chief analyst at Minchenko Consulting, a Kremlin-connected political-advisory firm. “This line would be effective, at least in the short term.”

Still, the Kremlin seems to recognize that, in the longer term, it cannot continue its struggle with the West over Ukraine without piling ever more strain on the Russian economy. That much has been clear from Putin’s softer tone toward Ukraine during the recent drop in the ruble’s value. On Tuesday, Russian Foreign Minister Sergei Lavrov even denied that Moscow has “any difficulties” in its dialogue with Ukrainian leaders, and his American counterpart, Secretary of State John Kerry, said the same day that Russia has been making “constructive moves” toward resolving the Ukrainian conflict.

It’s not likely to be enough to persuade the U.S. to ease the pressure on Russia’s economy. Indeed, President Barack Obama is expected later this week to sign a bill piling more sanctions on Russian state companies and businessmen. That may provide fresh ammunition for Putin’s anti-American rhetoric, but it could worsen what is already a dire economic situation at home. And if the President continues trying to dismiss those problems as the necessary price of his foreign policy, the core promise of stability that he made to his people upon taking power will crumble along with his country’s currency. At this rate of economic decline, the “wild ’90s” could wind up feeling tame in comparison with what’s to come.

Read next: Why Russia Is Destroying Its Own Economy

MONEY Markets

Why Russia Is Destroying Its Own Economy

A woman walks past a board listing foreign currency rates against the Russian ruble outside an exchange office in central Moscow on December 16, 2014. The Russian ruble set a new all-time record low on Tuesday after bouncing back briefly despite an emergency move by Russia's central bank to raise interest rates to 17 percent.
Kirill Kudryavtsev—AFP/Getty Images

In short, because Russia has a problem more urgent than its declining GDP.

Things aren’t exactly going well in Vladimir Putin’s Russia. Oil prices have fallen to $59 a barrel and the nation’s economy is on pace to contract between 4.5% and 4.7%—more than twice the contraction caused by our own Great Recession—if that price remains at $60 or below. Meanwhile, Russia is straining against American and European sanctions that are putting even more pressure on the country’s finances.

When the United States was facing recession, our Federal Reserve lowered interest rates to near-zero levels—and has kept them there. That stimulated the economy by making spending and investing more attractive (credit was cheap) and turning saving into a losing proposition (on top of low interest payments, money in the bank could potentially be eaten away by inflation).

But Russia has apparently adopted the opposite strategy. Instead of lowering rates to spur investment, the nation’s central bank has raised its key rate to a whopping 17%. That means simply leaving rubles in the bank will lead to extraordinarily high risk-free returns. Unless businesses can find an investment opportunity that will make them even higher returns, a very tall order, there’s no point in withdrawing any money. Why spend on a new store or factory when you’ll make more just letting your cash sit in a vault?

Read more Gorbachev Blames the U.S. for Provoking a ‘New Cold War’

It’s very likely, in other words, that Russia’s higher interest rates will slow its already slowing economy. Rosnef, a state-owned oil company, has already accused the central bank of “pushing Russia towards recession.”

But if that’s true, then why is Russia pursuing such a policy? The reason is that Russia has an arguably even more urgent problem than its slowing economy. Russia’s currency, the ruble, has been in free-fall as oil prices have dropped, and is now down 47% against the dollar since the beginning of the year. This is a big problem for Russian companies that need to pay their debt in dollars, and whose rubles are now worth nothing on international markets. Worse, Western economic sanctions have prevented businesses from accessing reserves of foreign currencies overseas. Without drastic action, Russia could find its economy permanently crippled by an all-but-worthless currency.

Since people selling their rubles for dollars is what’s pushing the currency down, the central bank has raised interest rates to make holding on to rubles more attractive. That’s meant to keep the currency’s value up, even at the expense of short-term economic growth.

The plan doesn’t appear to be working, however. Even after a massive jump in interest rates, the ruble has continued to crater. Economists are now suggesting Russia may be forced to impose capital controls—policies that would make trading rubles for dollars more difficult or expensive, or require exporters to convert dollars to rubles—to prevent a further sell-off.

Ultimately, anything short of an increase in oil prices is unlikely to do much good. Oil and gas revenues make up roughly half of Russia’s budget, and without that money, the country is in for rough times. “The central bank was too late with its move,” one expert told Bloomberg. “Without oil and the economy stabilizing, the ruble won’t rise.”

Read next: What Russia’s Ruble Collapse Means for the World

TIME russia

Russia’s Currency Keeps on Crashing

Russia's President Putin chairs a meeting with permanent members of the Security Council at the Kremlin in Moscow
Russia's President Vladimir Putin (C) chairs a meeting with permanent members of the Security Council at the Kremlin in Moscow, December 12, 2014. Michael Klimentyev—Ria Novosti/Reuters

Ruble falls another 8% early Tuesday despite emergency 6.5% percent rate hike, while contagion starts to spread

The rout in emerging markets continued Tuesday with Russia again to the fore, as an emergency interest rate hike by the central bank failed to stop panic selling of the local currency, stocks and bonds.

Selling across emerging markets has intensified and spread out this week as fears about tighter U.S. monetary policy, slowing global growth and country-specific problems in Russia and Ukraine have combined to create a storm which, if not perfect, is at least pretty adequate.

The Federal Reserve’s Open Market Committee meets later this week and is expected by many to drop its commitment to keeping interest rates at their current low level “for an extended period of time,” as the U.S. economy gains strength. That will end a period of nearly six years of nearly free money for global capital markets, raising problems for those who have squandered it in the meantime.

By early afternoon in Moscow, the dollar had surged 8.6% to a new all-time high of 71.26 and the dollar-denominated RTS stock index had fallen 15% to its lowest level since March 2009, as investors ignored the central bank’s decision to raise its key refinancing rate to 17% from 10.5% as of midnight. The pace of selling had eased off by mid-morning, but picked up again as the U.S. woke up.

In a television interview, central bank governor Elvira Nabiullina said the ruble was now clearly undervalued, but stressed that Russian companies would be able to repay their foreign debts, one of the biggest concerns among market participants right now.

The ruble had risen by more than 9% initially in response to the central bank’s move, but quickly gave up all its gains as world oil prices–on which Russia depends for its budget–fell further in response to weak economic data from China. The benchmark price of crude fell to its lowest level since April 2009, trading as low as $54.34 a barrel, before rebounding later on more encouraging news out of the Eurozone.

“Oil prices clearly continue to hang like an enormous black cloud,” ADM ISI analyst Marc Ostwald wrote in a note to clients Tuesday, pointing to signs of contagion to other emerging markets.

Russia is only one of a number of oil-dependent emerging markets that have been hit hard by the drop in crude. Elsewhere, Venezuela’s bonds due 2027 fell over 8% Monday to less than 38 cents on the dollar, their lowest level since 1998. President Nicolas Maduro, who has largely continued the unorthodox economic policies of his predecessor Hugo Chavez, had said over the weekend he saw no need to cut subsidies on gasoline prices that many economists see as ruinous. He was also less than reassuring on the possibility of default, according toBloomberg News, saying that: “There is no possibility of default, unless we would decide to not pay anymore as part of an economic strategy for development.”

Dubai’s stock market also remained in freefall Tuesday, the DFM index falling another 7.3%. It’s now down nearly 20% in less than a week.

But the shock waves going through markets have affected more than just oil producers. Countries with high foreign debt, low reserves or weak current accounts are all being placed under a harsh spotlight–especially if their domestic politics is also generating bad news.

That’s certainly the case for Turkey, whose currency hit a new all-time low of 2.38 to the dollar Tuesday after falling 3% on Monday after police arrested dozens of opposition journalists in a crackdown on independent media at the weekend. Those arrested had been instrumental in exposing widespread government corruption over the last year.

“The Turkish authorities have a track record of using the broadly phrased anti-terrorism legislation, under which these arrests were made, to target political opponents and there is good reason to believe that is what is happening here,” Amnesty International said in a blog post.

In Asia, the Indonesian rupiah and Indian rupee continued to fall, along with their respective stock markets, despite the fact that both countries, as net importers of oil, should face less pressure on their current accounts.

ADM ISI’s Ostwald said recent moves had been exacerbated by the fact that financial regulation since the crisis had dried out liquidity in many markets, making them inherently more volatile. Many Wall Street and European banks have largely withdrawn from more exotic financial markets owing to higher capital requirements, while the increasing share of “passively” managed investment funds that use automated programs to update their portfolios has reinforced a tendency to herd behavior.

This article was originally published in Fortune.com

TIME Ukraine

As Ukraine Truce Holds, Russia Vows Economic Pain

Petro Poroshenko
Ukraine's President Petro Poroshenko walks along the World War I Honour Roll during his visit to the Australian War Memorial in Canberra, Australia, Dec. 12, 2014. Lukas Coch—AP

The Kremlin wants to maintain leverage over its neighbor as a means of keeping it from ever joining NATO

(KIEV, UKRAINE) — Fighting in eastern Ukraine between government troops and Russian-backed separatist forces has ground almost to halt. That should be good news for Ukraine, but Russia looks intent to pile on the economic misery.

In a detailed op-ed piece Monday, Russian Prime Minister Dmitry Medvedev painted a grim forecast of Russian economic blockades ahead as Ukraine embarks on closer integration with Europe.

“The Ukrainian government has made its choice. And even if our neighbors have a poor understanding of the ultimate price they will have to pay, that is their right,” Medvedev said.

Those ominous words came as a renewed truce in east Ukraine called for by President Petro Poroshenko isholding — barring sporadic violations — since it began last week.

More than 4,700 people have been killed since the conflict broke out in mid-April, U.N. rights investigators estimate — and more than a quarter of those deaths came after a cease-fire in September that was routinely ignored.

Ukrainian authorities are hopeful, saying more peace talks are on the horizon.

The intensity of attacks on government-held areas has reduced notably and is now limited to mortar and small arms fire, military spokesman Andriy Lysenko said Monday. Separatists who have often accused government forces of breaking the truce agreed that violence has reduced dramatically.

Changes on the ground appear to reflect shifts on the diplomatic front.

While supporting the separatists, Moscow has said it accepts the rebellious east should remain part of Ukraine. Russian Foreign Minister Sergey Lavrov told the state news agency RIA-Novosti last week that pro-Russian separatists were prepared to re-enter a “common economic, humanitarian and political space” withUkraine.

That position reflects the Kremlin’s desire to maintain leverage over its neighbor as a means of keeping it from ever joining NATO.

Although the separatist leadership in Ukraine’s eastern Donetsk and Luhansk regions publicly deny that they taking orders from Moscow, rebel officials privately concede the Kremlin plays a direct role in their decision-making. Lavrov’s comments suggest an easing of staunch secessionist positions.

A few weeks ago, rebel leaders were vowing to expand the territory under their control. But last week, separatists in Luhansk made a show of withdrawing heavy weaponry from the front line.

The next expected development is a prisoner exchange, which a senior rebel leader in Donetsk, Alexander Khodakovsky, suggested Monday could begin on Dec. 25.

Poroshenko has expressed satisfaction with the reduced carnage.

“I positively assess the cease-fire regime. This has enabled the strengthening of Ukrainian positions and resupply of servicemen on the line of defense,” he said.

But peace on the military front may serve only as prelude to economic hostility.

In his 5,600-word opinion piece Monday in the Moscow-based newspaper Nezavisimaya Gazeta, Medvedev outlined a new “pragmatic” chapter in relations with Ukraine.

“In plain Russian, dealing with Ukraine ‘pragmatically’ means giving it no quarter. Russia’s economicapproach to Ukraine will get tougher,” Dmitry Trenin, who heads the Carnegie Moscow Center, wrote in a Twitter post.

Medvedev wrote that Ukraine has been unhealthily reliant on Moscow for too long; adding that as of last spring, Russian orders from Ukrainian companies were valued at $15 billion, or 8.3 percent of Ukraine’sGross Domestic Product.

“Nobody in Ukraine has explained to us, or themselves, how these orders will be replaced,” he wrote.

Ukraine remains heavily dependent on Russian natural gas and industries in eastern Ukraine are still tightly intertwined with those in western Russia. Ukraine has had to go cap in hand to Russia recently for electricity supplies, as its power plants lack enough coal.

Medvedev also said a closer eye will be paid to Ukrainian citizens traveling to Russia for work — an ominous suggestion that this economic lifeline could be drastically tightened.

Ukrainian officials have put a brave face on those veiled threats.

“Everything that was possible to cut off has already been cut off by Russia,” said Valeriy Chaliy, deputy head of the Ukrainian presidential administration.

He said Ukraine has been pressing hard to diversify the markets for its exports.

“Not all roads lead to Russia,” Chaliy said. “Ukraine has other neighbors with which collaboration is possible without fear of getting stabbed in the back at any moment.”

U.S. Vice President Joe Biden spoke by phone with Poroshenko on Monday to discuss “Ukraine’s financial and energy situation and developments in eastern Ukraine,” according to a readout released by Biden’s office.

Biden said the United States remains committed to working with international partners “to ensure thatUkraine will have the macroeconomic support it needs” to implement its reform program.

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