A Ukrainian Bargaining Strategy for Trump; Alternatively, the Three-Russia Romanov Solution

It is encouraging to see that Trump started working on Ukraine immediately after winning on election day. He picked up the phone to talk to Ukrainian President Zelensky (with Elon Musk at his side, a big friend of Ukraine), and the President of Poland is flying to Washington. The Ukrainina War has a win-win solution, and he knows it, and it is practical. He said he would solve the problem in 24 hours, and if we take that to mean “24 hours after I am inaugurated”, he can do it. I even know his strategy. And it doesn’t matter if I tell everyone, because it will work all the better if everybody knows what it is.

Game theory is the branch of economics that deals with gamelike strategic situations: bargaining, negotiation, threats, military strategy, product pricing, campaign strategy, litigation, and so forth. I am an old game theorist, author of Games and Information: An Introduction to Game Theory, which has gone into four editions since 1989 and been translated into Japanese, Italian, Spanish, French, and Chinese (twice, in Complex and in Simplified characters). I retired from Indiana University a few years ago, and have held visiting positions at Harvard Law, Harvard Econ, Yale Law, Chicago Business, Tokyo Economics, Oxford Nuffield College, and UCLA business. I’ve written over 50 scholarly articles in game theory, industrial organization, monopoly law, law-and-economics, and the Japanese legal system.¹

My strategy is to end the war by having Russia give back half of what it conquered, but keeping Donetsk, Luhansk, and the Crimea.² Plebiscites would be held to confirm that this is the wish of the inhabitants, but mainly for show, since inhabitants who don’t like living in Russia will already have left. A demilitarized zone will be set up on the Russian side, and U.N. troops will patrol it. Ukraine agrees not to block the Crimea’s water supply. Ukraine agrees not to join NATO or the European Union. The United States will give 10 billion dollars a year to Ukraine and end trade sanctions against Russia so long each country behaves itself. The U.S. will also give $10 billion to compensate any Ukrainian with claims against the Russian government for expropriation of property. Everything will be phrased in such a way that both sides can declare victory, perhaps writing the peace treaty in English so that the Ukrainian and Russian translations can vary enough to make it look good to both sides.

What Trump is doing, I believe, is suggesting something like this to Russia and Ukraine. He is also asking Poland, the Baltics, and Germany if there are any details they don’t like, and assuring them that he is not pro-Russian even though he has great respect for President Putin— who, after all, managed to fool them all and conquer a good bit of Ukraine.

Both Ukraine and Russia would prefer this plan to the status quo, because it brings an end to an expensive and destructive war. Zelensky has always said publicly that he wants the Crimea back, but that’s just talk. In fact, though he probably would indeed like the Crimea back, I would guess that he prefers to have Russia keep everything else it is currently occupying, because it is occupying the regions that voted against him in the past. Right now, the western Ukraine can win all the presidential elections, and it is the richest part of the country too, which means it will tend to subsidize the eastern part. For Zelinsky, losing Donetsk to Russia is like losing Detroit to Canada would be for Trump.

Figure 1: Proposed Boundary Changes

Putin has annexed his conquests to Russia, and he’d like to annex the entire Ukraine, but he’d settle for just the Crimea. His original plan was to annex the Crimea and then to invade Ukraine and turn it into a puppet state. The attack on Kiev failed, though, and he fell back on the idea of annexing a few provinces, poor and obscure though they were, so as to be able to claim victory. He can walk back the annexations, especially if a plebiscite is held that determines that, for example, the people in Mariopol want to go back to being part of Ukraine (such a plebiscite will show that, if Mr. Putin wants it to show that).

This outcome is a win for the United States too, compared to the status quo in bello (the status quo ante bellum would be better, but it’s too late to get that). We have probably degraded the Russian military by now, and any more money we spend propping up Ukraine is a waste. Our trade sanctions hurt our economy as well as Russia’s. We would improve relations with Russia, and that would help us with Iran, Syria, and China. We would extract some territory from Russia for Ukraine, because we’re in a good bargaining position, particularly if Donald Trump is doing the negotiating and is President. (Under Biden, we’d probably have to settle for the status quo boundary rather than getting half of Russia’s conquests back.) Trump will get Ukraine to agree because (a) the plan is actually a very good deal for Ukraine, and (b) he can threaten to reduce aid to Ukraine so they lose more territory and have to settle for a worse deal. Trump will get Russia to agree because (a) the plan is a good deal for Russia, and (b) he can credibly threaten to keep the war going so as to keep Russia drained and busy. Trump himself will benefit, because one thing he’d love to have is the Nobel Peace Prize, and it would be hard to deny it to him. Theodore Roosevelt got one for something similar: making peace in the Russo-Japanese War of 1905. Japan heavily defeated Russia in the Far East, but at heavy financial cost, and there was a possibility that Russia might win in the long run, once it reformed its army and navy and figured out how to get them into East Asia. Roosevelt negotiated the Treaty of Portsmouth (New Hampshire) under which Russia ceded Japan some worthless but spacious territory (southern Sakhalin), gave up its dominance in northern China to Japan (Port Arthur as a base, and influence in Manchuria), and Japan was allowed free rein in Korea (which it soon annexed). There were riots in Tokyo— Japan had had a resounding military victory and the Japanese wanted more than they got— but there was peace between the two countries for 25 years.

I am sure some of you, attentive readers, are nonetheless unhappy. My plan ends up with Russia better off than it was in 2000! They get to retain most of their ill-gotten gains! Well, is the plan above, which I predict is what’s going to happen in the real world, what I really want? No. I’d prefer something much different.

Here is what I would really like to see happen. See Figure 2 for a map of it. First, I would restore Ukraine to its borders as of 2000, giving it back the Donbass and the Crimea in full. This would be useful for world peace, since a strong Russia is bad for world peace, and a Russia which has naval bases in the Crimea is bad. I would not stop there, though. Many Russians will always be yearning to get Ukraine back. Thus, I would divide Russia into three new countries, the kingdoms of Novgorod³, Suzdalia, and Siberia, and give Karelia to Finland (all Karelia, not just West Karelia) and East Prussia to Germany (but not the Polish part of East Prussia). Each of the three kingoms would be a constitutional monarchy headed by a different member of the Romanov family.⁴ I would also divide Ukraine in two: a western part called Ukraine where they speak Ukrainian and an eastern part called The Golden Horde where they speak Russian.⁵ This would help with the ethnic tensions in Ukraine that were one cause of the Russian invasions, and the western country could join NATO and the EU, since it is more European in its economy, and “feel”, being part of Poland historically.⁶

Figure 2: The Rasmusen Plan

How do you like my second plan? Does it sound like a royalist fantasy? Well, it is a fantasy, of course, but it is no more fantastical than the plan Presidents Zelensky and Biden have been holding out for: for the Russian army to retreat to the borders of 2000 and then start negotiations for handing over President Putin as a war criminal and how much war damages Russia would pay Ukraine. Both my five-country solution and the Biden solution could be achieved, but only by starting World War III. The United States would have to use its army, and it would have to not only clear Russia out of Ukrainian territory but to invade and conquer Russia itself in order to get the division into three countries or the execution of Putin as a war criminal. It would not have to be a nuclear war, but it would be expensive in gold and blood. Oh, and we’d have to let China invade and conquer Taiwan⁷, and possibly Korea and Vietnam, since we would be too busy in Europe to carry on a war with China at the same time.⁸

But I don’t fret too much over not getting my Romanovs back. Peace and prosperity would be good enough.

Footnotes

1. This is very simple game theory, and applied, not mathematical, so you’ll wonder why I lay these out, but it’s a necessary preliminary for midwit readers who can’t tell a good thing when they see it. You, dear reader, are not one of those midwits because midwits don’t read footnotes.

This footnote is an example of applied game theory.

The previous sentence is also an example of applied game theory. I’d explain, but Substack, good as it is, doesn’t allow footnotes to footnotes, so you’ll have to figure it out for yourself.

2. I hesitate about whether to give Russia Mariopol and a strip along the Sea of Azov so as to connect the Crimea to the rest of Russia.

3. The Kingdom of Novgorod would be a descendant of the Mngmedieval Republic of Novgorod. Figure 3 shows the situation in 1100. This was just before the Mongol invasion of the 1200’s that destroyed the old kingdoms and paved the way for the small principality of Moscow to slowly rise to grandeur.

Figure 3: Kievan Rus

4. Suzdal only has 10,000 people, but that makes it suitable as a capital where the Czar would live. The medieval kingdom was called Vladimir-Suzdal, but that is too long, Vladimir is too easily confused with the male Christian name, and Suzdal lends itself to the melodious country name, “Suzdalia”.

5. Karl Emich would be Czar of Suzdalia, George Romanoff would be King of Siberia, and Natalia Consolo would be Czarina of Novgorod. The wealth of the current Russian oligarchs would be seized and given to the three monarchs, depending on its location, and the Romanovs would be required to have their heirs marry into the oligarchs’ families.

6. The eastern part of the circa 2000 country of Ukraine has never been its own country and doesn’t even have a region name. The Golden Horde had one of the best country names ever, and the Horde occupied this part of Russia for a long time, so even though there is little Mongol influence now, it seems appropriate to revive the name. In Russian, it would be Золотая Орда (Zolotáya Ordá). The Horde called itself the Ulug Ulus, but we wouldn’t want to use that, since it’s Ugly. Figure 4 shows the divisions in Ukraine using the results of the 2010 Presidential election.

Figure 4: West and East Ukraine (see https://www.polgeonow.com/2014/03/ukraine-divisions-election-language.html

7. Personally, I’d take Taiwan over Ukraine, I think. Taiwan only has 23 million people, compared to Ukraine’s 41, but it has a GDP of 750 billion dollars, compared to 180 for Ukraine. Ukraine has a better army, I expect, but we do more trade with Taiwan, and the trade is more strategically important (think chips). Plus, Taiwan has been an ally since 1941. The two countries have an interesting historical similarity. Back in the 1950’s, Republicans called on President Truman to “unleash Chiang” and let him invade and conquer mainland China. Now in the 2020’s, Democrats call on President Biden to unleash Zelensky and let him use the weapons we give him to invade Russia. Both Presidents (and Eisenhower and Trump) were dubious that those invasions would do anything but provoke world wars when the invaders got walloped, which, indeed, was no doubt Chiang and Zelensky’s intent.

8. I am very interested in what vision of the future people have who oppose any peace that doesn’t require Russia to leave 100% of the territory it has conquered. Would you like for NATO to declare war on Russia? Do you have another plan? Or is your position that a Ukrainian victory is impossible, but Ukraine should keep the war going anyway for another fifteen or twenty years, or forever?