How Europe Lost Ukraine

The European Union has failed Ukraine. Six years after a popular explosion of hope and enthusiasm for Europe rocked Kiev, Ukraine's presidential election finds the country further from EU membership than ever. Ukraine is deeper in debt, more corrupt, and just as dysfunctional as it was in 2004, when hundreds of thousands of people turned out on the streets of Kiev to support the leaders of the Orange Revolution. Those leaders offered them democracy, reform, and EU membership in place of more dependence on Russia. It was the high-water mark of Europe's ability to project soft power.

Instead of seizing this moment, Brussels responded with indifference. Preoccupied with internal squabbles over a new constitution and fearful that Eastern job seekers would flood the West, EU officials balked at even referring to Ukraine as a "European country" and refused to initiate a formal accession process. As a result, no matter who wins next week's presidential runoff in Ukraine, a golden opportunity for Westernizing the country will have been missed.

The EU's coolness toward Ukraine is hard to understand. To get a sense of how powerful the prospect of membership can be, consider the case of Turkey, an aspirant that has profoundly transformed itself over the past decade. Politically connected clans and bad debts have been replaced by consumer credit, functional banks, and the beginnings of a knowledge economy. The dead hand of the military has been (almost) removed from politics and the economy, and democratic reforms have helped foster an open society. And all this was accomplished by the Turks. All it cost Europe was a signal that membership was a possibility, and an intense diplomatic effort to help Turkey change (an effort that's continued even as EU attitudes toward Turkey have cooled).

Why was Ukraine never given a similar opportunity, despite the fact that in many ways—in terms of education, industrialization, and culture—it is a more natural fit with Europe? One explanation is timing. The Turks got serious about membership in 2002. By 2005, when Turkey was accepted as a candidate, "expansion fatigue" was setting in across the EU. Many core members, notably Germany and the Netherlands, felt that expansion had cost enough and gone far enough, while countries that had backed Turkey had spent all their political capital. Ukraine seemed a bridge too far.

A deeper explanation was a lack of vision. In Ukraine's case, the EU let short-term thinking and a preoccupation with constitutional reform triumph over strategic ambition. Many old EU members were nervous that a big new state like Ukraine would, under new voting rules, dilute their say in the Union. So they overlooked a perfect opportunity to help stabilize their Eastern flank, despite the fact that Moscow, while it vehemently opposed NATO membership for Ukraine, never opposed EU expansion.

To be fair, Ukraine's elite didn't help. An expensive EU initiative last year to refurbish Ukraine's gas-pipeline system, for instance, foundered on Kiev's objections to introducing transparency and cutting down on corruption.

Whatever the cause, the result is that while Ukraine's leaders now still pay lip service to the idea of joining the EU, the prospect of Ukraine actually doing so is fading as it slides toward economic collapse. Over the past few years, infighting in the Orange camp has led to round after round of populist spending, financed largely by printing more money. Rising energy prices also made Ukraine's critical aluminum and steel industries less competitive, and the government decided not to pass higher gas costs on to consumers, footing the difference itself. The result is a $37 billion external debt this year. The IMF may cover some of that, but a 2008 deal has stalled because politicians won't make painful cuts. So Kiev will likely turn instead to Moscow—which is also cash-strapped, but eager to get its hands on Ukraine's crown jewels: its gas pipeline system and metals factories.

A deal with Russia, however, would cost Ukraine a large chunk of its independence and make a volatile neighborhood even less secure. By failing to seize the moment, Europe has failed the Ukrainian people and betrayed its own interests and ideals. All is not lost—polls still show that more than 70 percent of Ukrainians want to join the EU—but the country's near collapse has made the job of integrating it into Europe infinitely more difficult. Trying to reverse matters will be an unappealing prospect for Brussels. But the only thing worse would be having a failed state on Europe's eastern border.