Corruption, fraud and Ukraine’s defense minister

Adrian Karatnycky is a senior fellow at the Atlantic Council and the author of “Battleground Ukraine: From Independence to the Russian War,” to be published later this year.

In recent days, a fusillade of articles in Ukrainian and Western media has reported scandals, both alleged and real, involving price gouging on catering for the Ukrainian military, and the sale of substandard body armor at inflated prices. As a result, several key Ukrainian defense ministry officials have been sacked, one has been caught with a cache of hundreds of thousands of dollars, and criminal investigations have been launched.

Thus far, the scale of alleged violations runs to the tens of millions of dollars — large sums, to be sure. But it’s a drop in the bucket given the hundreds of millions in Ukrainian and Western-donated defense resources that have been deployed in the year since Russia’s massive invasion.

Anti-corruption activists have correctly faulted the secrecy surrounding procurement contracts and identified weaknesses in internal auditing technologies and systems. But Ukraine’s Defense Minister Oleksiy Reznikov has riposted that even the public procurement of meals for the military could reveal information about its size and other wartime secrets useful to Russia.

Reznikov also asserted that if price gouging for certain foodstuffs occurred, it was in only one of the eight contracts the ministry sealed, as well as the fact that amid global food price increases, the overall cost of provisioning meals for the military per capita is just 10 percent higher than the year before the war — this, despite the logistical challenges of operating in combat zones.

And all of this needs to be kept in mind as Reznikov’s fate is being debated. Although, at the time of writing, cooler heads do appear to be prevailing.

The United States and NATO officials say the alleged abuses are unrelated to the billions in direct weapons and munitions transfers Ukraine has received from the West. Indeed, the best evidence of the effective use of Western military assistance is being displayed on the battlefield, where Ukrainian forces have excelled.

In addition, the reaction of Ukraine’s government to the allegations of fraud and potential corruption has been eminently reasonable. Those directly responsible for suspicious contracts have resigned, and criminal investigations have been initiated. Moreover, the defense ministry and parliament have moved quickly to find a middle ground between secrecy and accountability in procurement during a time of war.

Despite these facts, however, a small group of zealous anti-corruption activists and journalists — none with direct experience in the national security or military industrial sectors — have called for the well-regarded Reznikov’s resignation or dismissal.

All corruption and price gouging deserves to be investigated and punished, of course — especially in a country where each stolen dollar weakens the war effort. Nevertheless, given the scale of a war-time budget, which takes up the lion’s share of the state’s expenditures and resources, it’s important to realize that such incidents are likely unavoidable, even with the best systems of control and audit in place.

This is all the more so given the environment Ukraine faced in the early months of the year when Russian forces were rapidly advancing, as the priority at that perilous time was to procure available supplies quickly, while the country’s military, national guard, and territorial defense units were expanded.

In 1982, during the early days of Ronald Reagan’s U.S. presidency and the country’s military buildup against the Soviet threat, the renowned strategic thinker Edward Luttwak (whose more recent ideas on the war with Russia haven’t been well received by Ukrainians) published an important essay entitled, “Why We Need More Waste, Fraud and Abuse in the Pentagon.”

Luttwak’s provocative title was making a rather mundane point: The U.S. needed a much larger defense budget, and in such an expanding budget, there would inevitably be waste, occasional fraud and mismanagement. Luttwak further argued it was crucial to try to respond to and minimize such systemic failures, all the while understanding that they’re unavoidable and mustn’t undermine the need for a strong military built on innovation.

He also cautioned against excessive civilian micromanagement and controls, concluding: “If the price of a wise strategy, of better operational methods, and of more ingenious tactics is indeed the neglect of micro-management, then so be it.”

Luttwak’s argument has salience for a Ukraine that is now caught in an existential war against President Vladimir Putin’s Russia.

Amid the current set of allegations, both the Ukrainian public and the country’s Western friends should recognize that there will be occasional failures in the military’s systems of control. And these failures should be seen as par for the course in any military that’s rapidly building up and coping with war-time exigencies.

Undoubtedly, such failures should lead to improved systems of control and the punishment of those guilty of corruption. However, they shouldn’t prompt witch hunts, which could needlessly eviscerate Ukraine’s very effective national security leadership.

The defense ministry’s occasional failures need to be weighed judiciously against Reznikov’s impressive record of accomplishment. Apart from Ukrainian President Volodymyr Zelenskyy, he has emerged as the most effective advocate for Western military assistance, and his cogent arguments have won the trust of Western allies.

Ukraine should only change horses in midstream under exceptionally grave circumstances — and based on what we know, such circumstances are currently absent.