Ukraine president Viktor Yanukovych just unceremoniously rejected his country's E.U. Association Agreement, a 1,000-plus page document, painstakingly negotiated over six years and intended to cement Ukraine's political, economic, and trade ties with Europe. Now he's slated to fly to Moscow on Tuesday, where the Kremlin is finalizing the terms of its counter-offer of financial support in return for political allegiance. With opposition to the Russian option gaining strength, Yanukovych faces a seemingly stark choice. He can bow to Moscow and its offer of cheap gas and easy money, or to the apparent will of Ukraine's people by resurrecting its agreement with the European Union and re-engaging with the International Monetary Fund, which has suffered through two failed programs. Muddling through -- as Yanukovych has done for so long -- is no longer an option.
While this geo-economic choice seems stark, actually, it is not what it seems. Ukraine will almost certainly have to accept the need to reform its economy regardless of which political direction it chooses to pursue. Recent experience and economic reality mean that countries that offer the prospect of financial support in return for political fealty often end up pushing for IMF-style reforms in any case. The real choice then is not between painful economic reforms from the West and cheap gas and easy money from Russia. It is a choice between who imposes and enforces the necessary reforms and a balancing of political and economic costs and benefits.