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Expert article 905 Baltic Rim Economies, 21.12.2011 Quarterly Review 5�2011 Six more years with Vladimir Putin By Lena Jonson On 24 September 2011 it was clearly demonstrated that Dmitry Medvedev’s presidency had come to an end. He declared that he steps back in favour of the candidacy of Vladimir Putin in the March 2012 presidential elections. Medvedev’s decision was perceived by most independent observers as the end of the 2009 modernization campaign and its embedded promises of political reform. Domestic critics regard the return of Putin as president a catastrophe for the country. The serious problems described by Medvedev in his article “Russia, Go!” and in which he motivated the “modernization” campaign still exist. What Medvedev described as illnesses of a system, such as widespread corruption, lack of transparency, of democracy and rule of law, are as serious, or even more serious, today. How will Putin, during a third term as president, respond to these challenges? According to most Western observers and many Russian analysts, the Russian political system is highly obsolete in the context of the complexities of contemporary society. If Putin understood the scope of this challenge, his programme would be expected to include political reform. Putin’s critics do not expect political reform. In their analysis, Putin is both the creator of the present power system and its prisoner. He is at the top of a system created to guarantee him full control and stability. The power vertical, the large percentage of siloviki in state administration, and the Putin clan control of economic life are backbones of the system. At the same time corruption, which spreads due to lack of transparency and rule of law, undermines the very system and prevents control and management from above. What Putin needs is to transfuse new blood into the system, blood which could help vitalise and modernize the system without revising its foundation. Yet, as pointed out by his critics, Putin has consummated a system where channels from below for demands, requests, and new ideas have been closed. Political alternatives are prevented by laws, regulations, and practices from above which make it utterly difficult for all efforts of independent political mobilization. The United Russia party today constitutes the major channel for the communication of ideas upwards. Major career paths run through pro-Putin youth organizations. Although time has changed and no parallels should be made with the Soviet Communist Party nomenklatura, there are similarities with the way that alternative communication channels have been closed under Putin. The present system provides new faces but sorts out new ideas from reaching the official political discourse and agenda. Medvedev recently launched a website called “large government” to encourage new political ideas within the framework of United Russia’s discourse. Yet, as long as there are no political mechanisms for introducing new ideas, except through the party of power, and no political institutions to be held accountable, “large government” innovations remain an illusion. Putin has demonstrated, ever since he came to power in 2000 that his instincts as well as the instincts of the large contingent of siloviki in state decision-making positions, are to guarantee that the right of free speech, meetings, and demonstrations will remain highly restricted. As returning president he needs to try at least some piecemeal political reform during the years to come. Otherwise, six more years of restrictions postponing political reform could be highly counterproductive for his regime and for society at large. According to sociological research, Russian society is undergoing deep changes. During the last more than one and a half years we have witnessed a trend of reduced support for the United Russia party, and for Medvedev and Putin. United 66 Russia is, however, guaranteed a majority in the State Duma, and Putin can be sure of being elected next March. Research shows that the strongest critics live in the large cities and belong to the middle class, individuals who have no party to articulate their demands. Some sociologists talk in terms of a “crisis in political confidence”. Civic grass-root movements have mobilized people on specific issues and there are reports of spontaneous and temporary organizations and manifestations around the country by wider social groups in society on issues such as benefits, housing and employment. The use of laughter, irony and satire as political weapons by the democratic opposition during the last autumn are signs of a new political atmosphere in society. Thus, the future President will meet a completely new situation with regard to the mood of the population. However, as pointed out by several analysts, the new situation includes not only discontent from the democratic opposition. Far stronger are the ultra-right nationalists fed by frustrated discontent and xenophobia. Putin seems more receptive to the mood and arguments from this constituency. He might have been taken by surprise by the mass manifestation of the almost 10.000 frustrated xenophobic young men at the Manezh Square in December 2010. He knows the strength of these moods, and he has on several occasions demonstrated his will to play the nationalist card. Therefore, he also cautiously prevents the nationalists from creating any independent organization outside or within the official party system. With an economy highly dependent upon the export on oil and gas, and a state budget based on expectations on high world market prices on energy, Russia is vulnerable to fluctuations. The budget adopted recently for the period 2012- 2014 with cuts of means to the social sector and increases to defence and internal security give small margins in case popular discontent would explode. The issue of political reform will, whether he wants it or not, haunt Putin during the coming years. As he is basically unwilling to respond to such demands, Putin will take on measures to prevent them from spreading. But this may instead give nourishment for the opposition to grow. While the parties of the democratic opposition are viewed as no alternative for most people as demonstrated by opinion polls, a new generation of democratic leaders may appear from the civic grass-root movements. People like Alexei Navalnyi, Evgeniya Chirikova and Ilya Yasin may be among a future generation of leaders. However, if a reform movement is to succeed, a major role must be played by reform-minded groups already within the political elite. So far, there are no signs of this. The Putin elite seems united so far. The changes in the Russian political atmosphere during the last one and a half years may be the faint sign of something new in the making, so far mainly hidden under the surface. Although this new popular energy may not materialize in the short run, at the end of the day it may become important, perhaps decisive, for political reform and modernization. This is something that a Putin 2.0 needs to take into account. Lena Jonson PhD, Head of Russia Research Program Swedish Institute of International Affairs Sweden � Pan-European Institute � To receive a free copy please register at www.tse.fi/pei �
Expert article 906 Baltic Rim Economies, 21.12.2011 Quarterly Review 5�2011 The outline of political reforms in future Russia By Kirill Rodionov In September Vladimir Putin and Dmitry Medvedev declared a new configuration of the executive authority for the nearest 6 years. The reshuffle within the tandem became yet another act in the process of the power vertical strengthening, which started after Boris Eltsin had quitted as the President of the country. Political analysts are calculating how old the Nation Leader will be in 2024 and they draw parallels with the period of Brezhnev's stagnation. Is everything that fatal? Can one expect any changes? In Russia the periods of political «warming up» and «cooling down» are synchronized with the periods of strengthening and weakening in the West. For example, the transition from NEP to the policy of collectivization, accelerated industrialization and mass terror occurred at the same time with the beginning of the Great Depression. Fast postwar recovery of Europe, consolidation of the Western countries under the authority of USA were the important factors of the situation, when by 1953 most of the Soviet elite had realized the necessity of reforms. The transition from Khruschiov- Kosygin's reformations to the conservation of the USSR political system coincided in time with the Student Revolutions of 1968 and the following crisis of 1970s in the West (stagflation and energy crises of 1973 and 1979). The world situation underwent a sweeping change in the 80s - «neoliberal revolution» of Reagan and Thatcher, democratic transformation of the South European countries, and the beginning of the market reforms in China also brought the politics in the USSR to the understanding that some reforms were necessary. Under the conditions of slump in oil prices in the middle of the 80s, acceleration of the European integration, a dynamic economic growth in the developed countries and reinforcement of the USA international influence Russia had to make radical reorganization of its socio-political and economic systems. But at the turn of the millennium the global situation changed once again – the crash of NASDAQ high-tech market in 2000, recession in the USA in 2001, the terrorist attack in 2001, difficulties of the USA in Iraq and Afghanistan, the failure of the referendum for ratification of the EU Constitution in 2004, the beginning of the mortgage crisis in the USA in 2007, and the financial turmoil of 2008-2009 indicate weakening of the Western countries in the first decade of the 21st century. Meanwhile in Russia certain authoritarian tendencies have started to gain momentum – the central TV channels takeover by the Kremlin, the raise of cutoff point for the political parties to pass to the State Duma, and the cancellation of gubernatorial elections. The world economic crisis, which has started in 2008, is of a systemic character. Like the crises of the 30s and 70s, this crisis will be over only after a fundamental transformation of the world economy, including the formation of a new model for economic regulation, global economic cooperation and international currency relations. As the Great Depression and stagflation crisis experience shows, the development and implementation period for the new institutions and economic development mechanisms which is characterized by instability of the world economy usually lasts about 10 years. That's why it may be assumed that the world economy will return to the stable growth in the 2020s. Apparently, Russia will have to go through a radical reorganization at that very period, so as to adapt to the changes occurring at the global stage. What will be the nature of the country’s future transformation? After 1991 Russia made an attempt of triple transition – from the Empire to the nation, from the plan to the market and from totalitarianism to democracy. It was only the transition from the Soviet planned economy to the market economy that turned out to be relatively successful. Without doubt, there are many problems in Russian economy today: strong budget dependence on oil and gas revenues, bloating government sector, low efficiency of the regulating institutions. However these problems are related to the overcoming Soviet heritage only to some degree - most of the oil net supplying countries face similar challenges. The problems of building a functioning democracy and creating a political nation turned out to be more difficult. The reformers of the future generations will have to solve these problems. 67 Political Reform The configuration of the branches of government will be the most important aspect of the future political reform. The actual unaccountability of the Government to the Parliament was one of the main weaknesses of the Constitution of 1993. During the last fifteen years the bodies of legislative power have had practically no influence on the ministerial formation. In addition, the Lower House of the Russian Parliament didn't bear any political liability for the realization consequences of its decisions, and that made a negative impact on the lawmaking. The imbalance in the powers of the legislative and executive branches of government blocked the democratic process in 1990s and stimulated the strengthening of the authoritative tendencies in later years. In order to make the Government accountable to the Parliament it is necessary to link the ministerial formation procedure to the results of the Parliament elections. Creation of the National State Throughout the greater part of its history Russia hasn't been a national state, but a territorially integrated empire. Russia's existence as the mother country which united its conquered colonies justified the need for strong authoritative power which controlled separatism of the outskirts. After 1991 the empire has partially reproduced itself - the modern Russia includes regions which do not belong to it in the historical and cultural context, such as the North Caucasus. As in the Russian Empire and the Soviet Union the integration of regions in post-Soviet Russia is ensured by the vertical power and suppression of any spontaneous national movements. Personalistic regimes are formed in the national republics, which form the background for future separation from Russia. In the future Russia must be reconsidered as the National Russian State. The formation of the National State must be accompanied by the entrance into the supranational communities of the Western world. Today there are no real preconditions for deep integration of Russia with the Western world. But China can play an important role in the future. This country is becoming the main competitor of the USA at the global level. As after the Second World War the Soviet menace was the reason for including Germany into the geopolitical space of the West, so modern China can be the key factor in the rapprochement between Russia and the developed countries. Kirill Rodionov Research Associate Gaidar Institute for Economic Policy Russia � Pan-European Institute � To receive a free copy please register at www.tse.fi/pei �
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