Trading with the Enemy

Amid rampant corruption in Kiev and as U.S. troops gather at the Ukrainian border, does the Biden Administration have an endgame for the conflict?

The Ukraine government, headed by Volodymyr Zelensky, has been using American taxpayers’ funds to pay dearly for the vitally needed diesel fuel that is keeping the Ukrainian army on the move in its war with Russia. It is unknown how much the Zalensky government is paying per gallon for the fuel, but the Pentagon was paying as much as $400 per gallon to transport gasoline from a port in Pakistan, via truck or parachute, into Afghanistan during the decades-long American war there.

What also is unknown is that Zalensky has been buying the fuel from Russia, the country with which it, and Washington, are at war, and the Ukrainian president and many in his entourage have been skimming untold millions from the American dollars earmarked for diesel fuel payments. One estimate by analysts from the Central Intelligence Agency put the embezzled funds at $400 million last year, at least; another expert compared the level of corruption in Kiev as approaching that of the Afghan war, “although there will be no professional audit reports emerging from the Ukraine.”

“Zelensky’s been buying discount diesel from the Russians,” one knowledgeable American intelligence official told me. “And who’s paying for the gas and oil? We are. Putin and his oligarchs are making millions” on it.

Many government ministries in Kiev have been literally “competing,” I was told, to set up front companies for export contracts for weapons and ammunition with private arms dealers around the world, all of which provide kickbacks. Many of those companies are in Poland and Czechia, but others are thought to exist in the Persian Gulf and Israel. “I wouldn’t be surprised to learn that there are others in places like the Cayman Islands and Panama, and there are lots of Americans involved,” an American expert on international trade told me.

The issue of corruption was directly raised with Zelensky in a meeting last January in Kiev with CIA Director William Burns. His message to the Ukrainian president, I was told by an intelligence official with direct knowledge of the meeting, was out of a 1950s mob movie. The senior generals and government officials in Kiev were angry at what they saw as Zelensky’s greed, so Burns told the Ukrainian president, because “he was taking a larger share of the skim money than was going to the generals.”

Burns also presented Zelensky with a list of 35 generals and senior officials whose corruption was known to the CIA and others in the American government. Zelensky responded to the American pressure ten days later by publicly dismissing ten of the most ostentatious officials on the list and doing little else. “The ten he got rid of were brazenly bragging about the money they had—driving around Kiev in their new Mercedes,” the intelligence official told me.

Zelensky’s half-hearted response and the White House’s lack of concern was seen, the intelligence official added, as another sign of a lack of leadership that is leading to a “total breakdown” of trust between the White House and some elements of the intelligence community. Another divisive issue, I have been repeatedly told in my recent reporting, is the strident ideology and lack of political skill shown by Secretary of State Tony Blinken and National Security Adviser Jake Sullivan. The president and his two main foreign policy advisers “live in different worlds” than the experienced diplomats and military and intelligence officers assigned to the White House;. “They have no experience, judgment, and moral integrity. They just tell lies, make up stories. Diplomatic deniability is something else,” the intelligence official said. “That has to be done.”

A prominent retired American diplomat who strenuously opposes Biden’s foreign policy toward China and Russia depicted Blinken as little more than a “jumped-up congressional staffer” and Sullivan as “a political campaign manager” who suddenly find themselves front and center in the world of high-powered diplomacy “with no empathy for the opposition. They’re decent pols,” he added, “but now we have the political and energy world all upside down. China and India are now selling refined gasoline to the Western world. It’s just business.”

The current crisis is not helped by the fact that Putin also is acting irrationally. The intelligence official told me that everything Putin has been “doing in Ukraine is counter to Russia’s long-term interests. Emotion has overcome rationality and he’s doing things that are totally nonproductive. And so are we going to sit down with Zelensky and Putin and work it out? Not a chance.”

“There is a total breakdown between the White House leadership and the intelligence community,” the intelligence official said. The rift dates back to the fall, when, as I reported in early February, Biden ordered the covert destruction of the Nord Stream pipelines in the Baltic Sea. “Destroying the Nord Stream pipelines was never discussed, or even known in advance, by the community,” the official told me. “And there is no strategy for ending the war. The United States spent two years planning for the Normandy invasion in World War II. What are we going to do if China decides to invade Taiwan?” The official added that the National Intelligence Council has yet to order a National Intelligence Estimate (NIE) on defending Taiwan from China, which would provide national security and political guidance in case such does happen. There is no reason yet, despite repeated American political provocation from both Democrats and Republicans, the official said, to suspect that China has any intention of invading Taiwan. It has lost billions building its wildly ambitious Belt and Road Initiative aimed at linking East Asia to Europe and investing, perhaps foolishly, in seaports around the world. “The point is,” the official told me, “there is no working NIE process anymore.

“Burns is not the problem,” the official said. “The problem is Biden and his principal lieutenants—Blinken and Sullivan and their court of worshippers—who see those who criticize Zelensky as being pro-Putin. ‘We are against evil. Ukraine will fight ’til the last military shell is gone, and still fight.’ And here’s Biden who is telling America that we’re going to fight as long as it takes.”

The official cited the little-known and rarely discussed deployment, authorized by Biden, of two brigades with thousands of America’s best army combat units to the region. A brigade of the 82nd Airborne Division has been intensively training and exercising from its base inside Poland within a few miles of the Ukrainian border. It was reinforced late last year by a brigade from the 101st Airborne Division that was deployed in Romania. The actual manpower of the two brigades, when administrative and support units—with the trucks and drivers who haul the constant stream of arms and military equipment flowing by sea to keep the units combat ready—could total more than 20,000.

The intelligence officials told me that “there is no evidence that any senior official in the White House really knows what’s going on in the 82nd and 101st. Are they there as part of a NATO exercise or to serve with NATO combat units if the West decides to engage Russians units inside Ukraine? Are they there to train or to be a trigger? The rules of engagement say they can’t attack Russians unless our boys are getting attacked.”

“But the juniors are running the show here,” the official added. “There’s no NSC coordination and the U.S. Army is getting ready to go to war. There’s no idea whether the White House knows what’s going on. Has the president gone to the American people with an informative broadcast about what is going on? The only briefings the press and the public get today are from White House spokespeople.

“This is not just bad leadership. There is none. Zero.” The official added that a team of Ukrainian combat pilots are now getting trained here in America to fly U.S.-built F-16 fighter jets, with the goal, if needed, of flying in combat against Russian troops and other targets inside Ukraine.” No decision about such deployment has been made.

The clearest statements of American policy have come not from the White House, but from the Pentagon. Army General Mark A. Milley, who is chairman of the Joint Chiefs of Staff, said of the war last March 15: “Russia remains isolated. Their military stocks are rapidly depleting. Their soldiers are demoralized, untrained, unmotivated conscripts and convicts, and their leadership is failing them. Having already failed in their strategic objectives, Russia is increasingly relying on other countries, such as Iran and North Korea … . This relationship is built on the cruel bonds of repressing freedom, subverting liberty and maintaining their tyranny. …. Ukraine remains strong. They are capable and trained. Ukrainian soldiers are … strong in their combat units. Their tanks, infantry fighting vehicles and armored vehicles are only going to bolster the front line.”

There is evidence that Milley is as optimistic as he sounds. I was told that two months ago the Joint Chiefs had ordered members of the staff—the military phrase is “tasked”—to draft an end-of-war treaty to present to the Russians after their defeat on the Ukraine battlefield.

If worse comes to worst for the undermanned and outgunned Ukraine army in the next few months, will the two American brigades join forces with NATO troops and face off with the Russian army inside Ukraine? Is this the plan, or hope, of the American president? Is this the fireside chat he wants to give? If Biden decides to share his thoughts with the American people, he might want to explain what two army brigades, fully staffed and supplied, are doing so close to the war zone.