No surprises

Few political operators or observers were surprised by the collapse of the fractious coalition between Yushchenko and Tymoshenko.  Indeed, some of Yushchenko’s allies – most notably powerful presidential secretariat chief Viktor Baloha -- seem to have been gunning for Tymoshenko’s failure even since she reclaimed the premiership last December.

Meanwhile, inflation has spiralled as Tymoshenko sharply increased state expenditures, and as  Yushchenko engaged in a months-long struggle over control of monetary policy.  On the international stage, Ukraine’s foreign policy has appeared increasingly incoherent as its two top leaders struggle to contend with one of the greatest strategic challenges Ukraine has faced in its short post-Cold War history: how to contend with a regionally resurgent and supremely confident Russia.

Politics above all

The government’s imminent collapse has little to do with the substance of economic or foreign policy-making -- the rancour between Yushchenko and Tymoshenko is fundamentally about the balance of political power.   However, the president has few options to reverse or forestall a reduction in his powers, the result of a Faustian bargain he made to peacefully end the ‘Orange Revolution’ in December 2004. 

Yushchenko’s influence in the current struggle comes not only from his constitutional authority to dissolve parliament, but also because his party -- Our Ukraine-People’s Self-Defence (NU-NS) -- though highly unpopular, has served as the ‘kingmaker’ for Ukraine’s last two prime ministers.  Tymoshenko’s bloc does not have enough votes in parliament to form a new government on its own.  Nor does the opposition Party of Regions, led by Moscow-friendly former Prime Minister Viktor Yanukovych.

Four options, three bad

However, as Ukraine inches closer to its third round of parliamentary elections in as many years, the ability of NU-NS and Yushchenko to influence the outcome of the current struggle is waning.  If the president and prime minister cannot resolve their differences, as appears increasingly likely, Yushchenko’s only politically viable alternative is to form a coalition with the Party of Regions, or part thereof.  This scenario could entail a split in Regions itself; although the party has done a reasonably good job of masking its divisions from public view, there are significant political and policy disagreements among the party’s top leaders. 

Allying with Regions is the ‘least worst’ option for Yushchenko, although given that the last NU-NS/Regions coalition ended in government collapse and constitutional crisis just 18 months ago, such an option would not realistically bolster Ukraine’s tenuous political stability.  

The other three options are even less appealing for the president:

• Yulia’s gamble?  Tymoshenko could form an alliance with Regions, an arrangement that would leave Yushchenko with little authority or political relevance.  Though such a manoeuvre could ensure she retains the premiership, it would damage her considerable popularity and reputation as a reformist.
• Regions on the rise  Alternatively, Regions could take the lead in forming an entirely new governing coalition with the smaller parties in Ukraine’s parliament -- the Communists, Socialists and former parliament speaker Volodymyr Lytvyn’s eponymous bloc.  Such an arrangement would virtually negate any prospects for meaningful political reform for the foreseeable future, and could give Ukraine’s foreign policy a strongly pro-Russian bent.   
• Fresh elections  If it appears that NU-NS is on the verge of being excluded from government, the president could carry through on his threat to call new elections.  However, this scenario is fraught with risk.  New parliamentary elections may only reduce NU-NS’s share of the vote, and Yushchenko’s influence along with it.  In a worst case scenario, new elections could precipitate serious political instability, as Ukrainian voters grow increasingly frustrated with the cycles of crises and snap elections that have marred Ukraine’s post-‘Orange Revolution’ politics.