Negotiating at gunpoint

Vladimir Putin has his finger on the trigger over Ukraine. [View in browser]( [Bloomberg]( Follow Us [Get the newsletter]( Talks between the West and Russia began in earnest today as President Vladimir Putin demands binding security guarantees against NATO, having again massed his troops on Ukraine’s border. The potential for an invasion is persuading the U.S. and Europe to focus on longstanding complaints that they dismissed for years. Key reading: - [Europe Fears Economic Hit If Russia Is Sanctioned Heavily]( - [U.S. Mulls Technology Restrictions on Russia to Stymie Putin]( - [Russia’s State Media Is Curbing Its Hostile Coverage of Ukraine]( - [Putin Sends Message to West as His Troops Turn Kazakh Tide]( - [U.S. Takes Thorniest Ukraine Issue Off Table in Russia Talks]( In three sets of talks this week, with the U.S., NATO and the Organization for Security and Cooperation in Europe respectively, Moscow is seeking a full-scale revision of Europe’s security architecture. While Putin says he doesn’t currently plan to invade Ukraine, and state media has curbed some of its hostile rhetoric, the West’s negotiators remain unsure of his intentions in the talks, especially how willing he is to pull the trigger. The Kremlin, meanwhile, could exploit differences emerging between the U.S. and Europe, with some major Western European nations nervous about the economic fallout from America’s push to consider big sanctions on Russia, particularly as they depend heavily on Russian gas to ease an energy crunch. As Russia surely knew it would, NATO has already rejected two key demands — that it withdraw forces to positions held in 1997, before ex-Communist eastern European nations joined the alliance, and that it rules out membership for Ukraine and other ex-Soviet states. That begs the question of whether Russia intends negotiations to fail to justify an intervention with the public at home, who’ve already absorbed years of hardship following sanctions imposed over the annexation of Crimea in 2014. The high-stakes poker game now unfolding pits the threat of military force against the promise of economic punishment. The outcome may be determined by how much Putin calculates the strategic goal of pushing the West back from Ukraine may be worth the economic hit. — [Anthony Halpin]( Ukrainian tanks during drills in the east. Photographer: Sega Volskii/AFP/Getty Images [Click here]( to follow Bloomberg Politics on Twitter and share this newsletter with others too. They can sign up [here](. Global Headlines Russian vow | Putin pledged to protect Russia and its former Soviet allies from what he said were outside efforts to [destabilize]( their governments in so-called “color revolutions.” He spoke in a video conference with leaders of a Moscow-dominated bloc after Russian-led troops helped authorities in Kazakhstan crush nationwide demonstrations. Tax threat | U.S. Democrats risk [losing]( their edge in key suburban districts as the stalemate over President Joe Biden’s economic agenda threatens plans to expand a tax break for well-off homeowners. Failure to pass the package could jeopardize the party’s chances of maintaining its slim majorities in the House and Senate in midterm elections. - Wisconsin Republican Senator Ron Johnson, a staunch supporter of former President Donald Trump, is [seeking]( a third term in the battleground state in November. Covid spread | Omicron arrived in a port city that borders Beijing and moved inland before Chinese officials detected it, seeding the highly contagious variant on the doorstep of the capital less than a month before the Winter Olympics. [Read more here]( about how previously isolated outbreaks are bleeding into one another. - Hong Kong has found a new preliminary positive Covid-19 case linked to a [scandal-hit]( birthday party that’s ensnared a minister in government quarantine. - Even as shipments of virus shots ramp up for billions of people left behind last year, dozens of countries are [struggling]( to turn supplies into inoculations. Best of Bloomberg Opinion - [How Hong Kong’s Covid Strategy Has Failed: Anjani Trivedi]( - [Where Trouble Is Lurking Around the World in 2022: Hal Brands]( - [What Biden Can Do to Help Keep Schools Open: Matthew Yglesias]( Jail time | Myanmar’s Aung San Suu Kyi was [sentenced]( to another four years in prison today after a special court found her guilty in a second round of charges brought by the junta that seized power in February. The ruling came just weeks after she was given a four-year term for inciting dissent against the military and breaking Covid-19 rules, although that was later halved. Aung San Suu Kyi. Photographer: Paul Miller/Bloomberg Surprise setback | Venezuelan President Nicolas Maduro suffered a rare electoral loss with his candidate defeated in a vote to elect the next governor of Barinas state, the birthplace of Hugo Chavez, who started the so-called socialist revolution. The outcome won’t weaken Maduro’s grip on power but is an [embarrassing]( turn of events for the regime given a prior vote on Nov. 21 was invalidated by top court loyalists. Bloomberg TV and Radio air Balance of Power with [David Westin]( weekdays from 12 to 1pm ET, with a second hour on Bloomberg Radio from 1 to 2pm ET. You can watch and listen on Bloomberg channels and online [here]( or check out prior episodes and guest clips [here](. News to Note - An Australian judge [quashed]( the cancellation of Novak Djokovic’s visa today and said the tennis star should be released from a quarantine hotel in Melbourne. - China moved the head of the police in Xinjiang to the top army post in Hong Kong as it takes an increasingly hard line on [security]( in the Asian finance hub. - Mali [closed]( its land and air borders with the Economic Community of West African States in response to sanctions imposed by the regional bloc. - Iran said it wants a comprehensive nuclear deal with world powers that removes sanctions, including on oil exports, and won’t [settle]( for an interim agreement. Thanks to the 34 readers who answered the Friday quiz, and congratulations to Yasmeen Alam, who was the first to name rum as the Lithuanian-made product a Taiwanese company reportedly bought 20,400 bottles of after China refused to import it. And finally ... The world’s green-energy transition is hitting speed bumps as power shortfalls in Asia and Europe boost global demand for fossil fuels. That’s exposing the pitfalls of relying too much on wind and solar. Although efforts to battle climate change have been largely dominated by renewables, the International Energy Agency says achieving net-zero greenhouse gas emissions by 2050 will require doubling [nuclear power]( worldwide. Cooling towers at the nuclear power plant in Nogent-sur-Seine, France. Photographer: Cyril Marcilhacy/Bloomberg Like Balance of Power? [Get unlimited access to Bloomberg.com](, where you'll find trusted, data-based journalism in 120 countries around the world and expert analysis from exclusive daily newsletters. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( [Ads Powered By Liveintent]( | [Ad Choices]( Bloomberg L.P. 731 Lexington, New York, NY, 10022