A License to Steal

Imagine how it would be if TV’s Tony Soprano and his Mafia crew had police badges. When they shake down a business (extort money by making it difficult or impossible for the business to operate until it pays off Tony and his thugs) it would be “within the law” because they have badges that say so. 

What’s more, imagine that the law itself is corrupt enough to give the Sopranos all the leeway they need to run such a “legal” extortion racket. And even worse, imagine that the local judges who sign the orders allowing Tony to conduct “criminal investigations” into the victim companies are part of the scam.

To most Europeans, Americans, Canadians and just about anyone else in the West, this would seem too far-fetched to be anything other than a plot for a movie set in some bizarre alternative reality. In Ukraine, however, it IS reality. The real Anthony Soprano could be Anton Sopranchenko – a Ukrainian thug with a badge.

The Mask Shows

Twice in the past two years (since the Russia-supported Yanukovich regime took power) one the top software development companies in Kharkiv has been raided by Ukraine’s Tax Police. And this is happening to companies all over Ukraine. They force their way into a company’s offices, usually wearing black masks and carrying automatic rifles, intimidate and threaten innocent employees, and confiscate computers and other equipment. Worse still, they often go through individual employees' desks and other places to outright steal whatever they can find. Then they prevent the company from doing its work until the company agrees to make a substantial payment.

The idea of a police force is to protect citizens, and businesses, from the unscrupulous actions of criminals. But in Ukraine the police – especially the dubious "tax police" – ARE the criminals... just mafia with badges. 

They make such raids on companies with alarming regularity. Ukraine is a very difficult place for honest people to try to start or run a business.  If you don’t play ball with the “authorities,” you won’t be in business for long. 

And it has gotten worse since the current Yanukovich government came to power in 2011. Yanukovich is a simple thug whose early years were spent as a common criminal and who grew to prominence as part of the Russia-leaning Party of Regions, which has always harbored a large criminal element. He lost out to Viktor Yushchenko in the rerun of the 2004 presidential election when a court confirmed that he had "won" the initial count only through widespread fraud. People have really never liked him since, but Yushchenko did such a poor job running the country that Yanukovich was able to win in 2010 (although the validity of that election has been in question as well).

Why Bother?

It is no wonder that Western companies have lost their appetite for investing or opening branches in Ukraine. A number of foreign companies that came here during earlier governments have given up and left.  Even though there is a great potential market here for many kinds of goods and services, the government corruption makes it too difficult to operate. Last year alone several European banks quit Ukraine and closed their holdings here. No one wants to try to make a living in a place where criminals have the power of government authority behind them.

Software development companies have thrived here, owing to the relatively low cost of outsourcing work here, compared with doing similar work in the West. But even these companies have their limits, and it would be a disaster if they began to pull up stakes and leave for countries where they aren’t robbed by criminal officials.

It’s one of the clearest indications of just how horribly corrupt this country remains. Even as the government makes empty platitudes to the EU about fighting corruption, reforming the judiciary, and making it possible for businesses to operate fairly and without fear, the sickening beat of corruption goes on. The reform talk is just a pack of lies, and the EU seems to be willing to accept it (which does not say much for the EU).

Not Ready for (European) Prime Time

For its part, the EU has been blustering about Ukraine’s need to speed up reforms before it will sign the Association Agreement they have been negotiating with Ukraine for the past several years. A number of EU leaders do seem to be concerned about letting a corrupt Ukraine become even an associate of the EU (and certainly not a real member). But there are those who seem willing to look past the travesty here for the sake of the EU’s geopolitical rivalry with Russia. They fear that Yanukovich's close ties to Putin, and the latter's ability to intimidate the dull-minded Ukrainian president, will result in Ukraine joining a Russian-led economic pact. This is something most Ukrainians do NOT want.

But the European view is also naive. The current administration has no real interest in fixing the problems that exist in places like Kharkiv and ridding the courts and police forces of the lowbrow knuckle-draggers who use their authority to prey on citizens; these, after all, are the core minions of Yanukovich's power. If the EU can’t exert enough pressure on Ukraine to make some real progress against the endemic corruption, then Ukraine really has no hope.

They say that people get the government they deserve. I love the Ukrainian people, but sadly, they do in fact have the government they deserve. They stood up against rigged elections in 2004 (with some help from Western operatives, I suspect), but sadly, the Yushchenko administration that took power after the Orange Revolution was a complete disappointment and their spirit of reform was crushed. Too many Ukrainians were left with the depressing feeling that there is no one they can really believe in or trust. 

Until Ukrainians find the conviction and determination to demand better and make it happen, it will continue to be a place in which Anton Sopranchenko and his thugs with badges will continue to enrich themselves at the expense of everyone else.