Trouble is brewing in a former Soviet satellite, and it is not Ukraine.  The “lebensraum” redux employed by the Russian Federation in its current Ukrainian endeavors is being repeated, and this time, the stakes are much higher. 

Latvia is now under attack from outside forces connected with the Russian Federation that are allegedly stirring up dissent and separatism in the former Soviet Socialist Republic (SSR.) This report comes from sources inside Latvia. 

An American diplomat and peace broker, Stephen Payne, has been coordinating meetings with Latvian heads of state and members of parliament in the last few months to repel what he believes could be the beginnings of actual “hot” war with the Russian Federation if not corrected immediately.  In an exclusive interview with AT, Payne explained the situation:

“As to foreign policy, when you look at where this goes in Ukraine:  Is Putin going to send troops into other parts of Ukraine or Eastern Europe?  My guess is that he will not.  But, in Latvia where I’m very familiar, they have a twenty-seven percent ethnic Russian population.  I could see torquing of that community to maybe stir up civil unrest and create problems, maybe some street demonstrations and things like that, just to see where it goes.  Now, Latvia’s a NATO member, and that’s a whole different line to cross, and my belief is that the NATO members including Germany, France and England would stand up and say, ‘That can’t happen’ and take real action.

“We have a Hispanic population here in Texas, California and many parts of the US where they celebrate and are proud of their Hispanic heritage but also proud to be Americans.  Are they going to invite Mexico to take over parts of the US?  I don’t think so. 

“So, this is something where there can be people of Russian ethnic origin in NATO countries or Eastern Europe without giving anybody the excuse, if you will, to come in and take military action, and I think that is where NATO would draw the line.”

Payne’s predictions are coming to pass.  Read here and here. 

Stephen Payne is the honorary consul to Latvia, former adviser to Latvian president Vaira Vike-Freiberga on political and economic issues, and recipient of Latvia's highest state honor, the Order of the Three Stars, for his work in helping Latvia become a NATO member.  At the 2006 NATO Conference, Payne led a panel on regional energy security.  Payne has also recently served on the board of directors of the U.S.-Baltic Foundation, which promotes free markets in the Baltic States.  Finally, Payne is a former advisor to President George W. Bush and has traveled with the president and former Vice President Dick Cheney during meetings with other heads of state. 

Payne is intimately familiar with the foreign policy dynamics of the region encompassing the former Soviet Union and its sphere of influence, and much of the democratization and economic liberalization that has occurred in the Baltic states (which has yielded unheralded prosperity in the region) can be traced back directly to Payne’s involvement.  Payne is currently working with the heads of leading Latvian political parties in parliament to ensure strong East-West relations, hoping to avert the kind of ethnic complexities dominating neighboring states. 

Payne is deeply concerned about what he feels is the overly simplistic view of recent Russian moves in the Ukraine and Georgia held by many in media and government in the west. 

The rest of Payne’s remarks to American Thinker can be viewed below: 

AT: What is your role and involvement in the Baltics and former SSRs over the years?

STEVE PAYNE:  “I am the honorary consul of Latvia, have been since 1999, and I’ve been very involved in Latvia from an energy standpoint.  Some of the first activities we had with Russia, as it involved Latvia, concerned the Russian closure of the Ventspils oil pipeline.  It was a big deal and it got turned off in 2003 under the auspices that it was old and needed repairs.  It hurt the Latvian economy a bit, but they’ve managed to rebound nicely from that.  After that, when the Iraq War started up, I was helping Tatneft and Yukos acquire some oil blocks in liberated Iraq.

“Tatneft is a state-owned company owned by the state of Tartarstan, which is a part of Russia in the Khazan region.  We also started working with Itera, which was the second largest gas company in Russia. Itera was interested in selling LNG to the United States, getting into the LNG business and shipping LNG to America.  This, of course, was right before America discovered that we had a lot of shale gas potential and that we were about to start producing  our own LNG, and now we have become an exporter of LNG instead of an importer.  I was leading that charge for Itera.  Itera has now been bought by Gazprom, as of late last year.  That’s essentially my involvement with Russia. 

AT: Economically, you’ve clearly been involved in these states, including former SSRs.  To what extent has the economic landscape changed in many of these former Soviet bloc countries and in Russia itself, and what impact has this change had on the foreign policy of these nations?

STEVE PAYNE: “I think you could even start with a broader question, and that is, why is US foreign policy shifting from a Mideast focus to what they call the Asia pivot and even a drawing in (not isolationist) but sort of a draw back into, ‘let’s fix America’s problems’?  The reason for that is the shale revolution in the United States.  Last October, two really big things happened. 1) We became the number one producer of oil and natural gas. 2) The US produced more oil at home than it imported.  And now when you look at the oil it’s getting from Canada, the oil it’s getting from Mexico, and the oil it’s getting from Venezuela, the US is not really at all dependent on the Mideast any anymore.  It is now a Western Hemisphere energy consumer.  That will go further and further where even the Venezuelan oil will become potentially less and less important.    As long as we play this properly and remove the ban on exports of oil, then it’s potential that we can continue to produce more oil here and become a net exporter, which would be a game changer internationally.

“With that, I think that Russia sees a little bit of a threat from the United States, threatening Russia’s goal to continue to be a major exporter and supplier of oil and natural gas to the rest of the world.  And they already are the major supplier of natural gas to all of Europe.  With oil exports coming on line and natural gas exports coming online, this would change the dynamic for Russia.  My understanding is that Russia receives about 52 percent of its national budget from oil and gas.  It’s a significant part of the budget and, consequently, it is a significant part of their foreign policy. 

AT: Their economy has improved substantially, has it not, with reforms including the flat tax revolution, and there’s also been improvement in many of the Baltic States where you’ve been involved.  Are they [Russia, former SSRs] in a position collectively to exert the kind of weight that many in the west fear?  Is that really a threat with which we need to contend?

STEVE PAYNE: “If you look at the map of current gas exports, there’s a little bit of gas that goes by pipeline to Finland, and a smaller part by pipeline goes to Estonia, Latvia, Lithuania.  The vast majority of the gas from Russia that goes to Europe – this is Germany’s gas, this is Poland’s gas – it all goes through Ukraine.  So, an unstable Ukraine is something that would be very bad for Russia, because it could stop most of their exports to Europe. 

“I think the current situation with Russia, and the reason Russia reacted the way that it did, is because it seems that Yanocovich and the people who were protesting had a deal. Russia felt like a deal was done, and the west felt like a deal was done, and everybody was ready to just let that sit until elections in May, and then all of the sudden, the people that were protesting in Kiev decided that for whatever reason, they wanted to keep going and threw Yanocovich out of the country. 

“That’s what happened.  A deal was struck, and it looks like Putin pushed Yanocovich to accept the deal, but then nobody went home.  Maybe, maybe, and I am not a spokesperson for President Putin or a Russian apologist either, but maybe Russia felt like a deal was done, they were honoring the deal, and then the protesters in Ukraine decided to do something on their own.  I don’t know, but I can certainly see it from Russia’s perspective.”

AT: There’s much oversimplification of these types of dynamics now by the current administration.  You have a lot of red lines, a lot of talk of Soviet resurgence, a lot of partial quotes from a much younger Putin about the tragic loss of the Soviet Union, used now in media and by noted public officials to push this concept that any action taken by Putin outside of Russia’s borders must indeed be part of some attempt to reignite Cold War politics.  Can you comment on the reasons this might not be the case, including Islamic radicalism and its role in Russian policy, and what other factors might play a part in Russia’s casus belli in Ukraine?

STEVE PAYNE:  “Russia has had its share of Islamic terrorism.  We have had the 9/11 attack and the Fort Hood attack, but I think the number of incidents inside of Russia have been significant.  There are things going on in Chechnya almost every day, the Beslan school massacre, the theater incident in Moscow.  I’m sure there are going to be more incidents as time goes on.  So, they’re fighting an even more active war on terror, on Islamic fundamentalism than the US is, because they are facing a greater number of attacks on a more frequent basis.  The 9/11 attacks were horrific and a larger number of people perished, but the frequency of attacks in Russia is severe.  That certainly affects both their foreign and domestic policy. 

“I don’t believe that when the Ukrainian protests started in December, or even the day before the Yanocovich government collapsed, that Putin had planned to invade Ukraine. I believe that Putin spent $50 billion to host the Olympics, and tried to clean-up his human rights image by letting “Pussy Riot” and Khodorkovsky out of jail. I think he spent that money and did those things to become a more respected world leader.

My view is that Putin invaded Ukraine for two reasons, 1) Russia must have a stable Ukraine to transport gas and 2) Putin saw what a “red line” meant in Syria and tested President Obama’s resolve – now Putin owns Ukraine and we literally took away his VISA card.”

AT: Does America really have any clout left that it can bring to bear when we have so many unfunded liabilities, quadruple world GDP?  The market may survive on US debt, but how long are investors in US debt willing to prop up the system?  Does this affect the ability of America to follow up on an ultimatum, and, is Obama fomenting these revolutions in North Africa, Syria and now Ukraine? Does he have an end game here that may differ from his public narrative? 

STEVE PAYNE: “In Obama’s book, he has made it pretty clear that he believes America is too strong and that it needs to be one of many nations. He said that in his speech in Egypt where he apologized for bullying everybody.  In the case of Libya, for example, before we went into Libya, they produced 1.3 million bbl/d.  Now they produce 250,000 bbl/d.  Their entire economy was oil production and now it has been decimated. People are not doing well and now it is a hotbed for al Qaeda, unfortunately, as our consulate in Benghazi learned in the worst way.  We’ve turned a tolerable and manageable situation in Libya into an international disaster and put them on the path to failed statedom.  It wasn’t a great situation before, but it was tolerable, and their leader would do some quirky things and make some strange speeches at the United Nations, but the people of Libya were doing okay.  Now it’s a mess. 

“It is interesting to see where this is all going to head.”

AT: What can we expect of US foreign policy in the future?  What will Russia likely do in response to the neo-Wilsonian bent of the current administration?  Can America ever again regain a modicum of respect on the world stage after this president?

STEVE PAYNE: “We still have the largest military budget by far of any nation in the world.  Right-sizing of the military in the US, focusing on the things that are really effective – this should be our task in the future.  Drones are effective, for example.  I’m not sure that we need as many soldiers as we did in WWII because a soldier of 2014 can do a heck of a lot more than a soldier of 1942.  We can operate a lot differently. Very few of our potential enemies possess the kind of technology currently employed by the US.”