From: "Marc Greenfield" <marc.greenfield@comcast.net>
From: Ethan Burger <ethansb@american.edu>
Subject: Contemporary Russia in Historical Context
Date: Tue, 16 Aug 2005
Dr. Anders Aslund asked the readers of the David Johnson list for some feedback on his recent piece concerning the alleged decline in political power and status of Russian President Vladimir Putin. [DJ: Actually, I asked for feedback.] We thought that there should be an on-going discussion concerning whether one can only understands contemporary Russia developments in a "Soviet" context. As discussed below, we do not anticipate the reconstitution of the Soviet Union (or the Russian Empire). Nonetheless significant change in Russia in many areas will require generational change. Many Russians have been expressing this view for years, but many in the West don't seem to be listening.
Marc Greenfield
Institute for War & Peace Reporting
&
Ethan S. Burger
American University
----------
Contemporary Russia in Historical Context
For years, many observers of Russia have been warning that it would be a serious mistake to see Mr. Putin's appointment (what else can it be called?) as anything but evidence that the Russian ruling elite has not surrendered the country's centuries-old obsession with centralization and the belief that power in the country must be exercised from Moscow.
We believe that some of Dr. Aslund's basic assumptions may give rise to unjustified policy recommendations. To understand Russia today one cannot ignore how the Soviet system operated, the dynamics of group politics, and the legacy of Russian history. Analysis and policymaking based on faulty premises can be counterproductive at best and extraordinarily dangerous at worst.
It is ironic that many of the very same people who misunderstood developments in Russia and failed to get their advice implemented during the first ten years of "reforms" are still volunteering wisdom with a high degree of confidence, approaching hubris. While many people, including Dr. Aslund, insist on putting a positive spin on Putin's selection, explaining that it reflected a democratic electorate's desire for orderly progress, a well-informed minority (at least in the West) recognize that this was nothing more than the appointment of a competent figurehead as "head of state," for which that the vast majority of Russians had been clamoring. This in all likelihood represents a return to traditional, centralized control of Russia in the hands of a small elite in Moscow.
Dr. Aslund and others have made the basic mistake of presenting Russian reforms (a term we are reluctant to use) as being motivated by a desire of the Russian people (as opposed to Westerners) to establish a democratic state with a "free" market system. Despite the Russian elite's strong distrust of democracy, and lacking any reasonable alternative, it merely experimented with certain changes in the hope of revitalizing the moribund Soviet economic, perhaps along the lines originally envisioned by Mikhail Gorbachev.
Had Western advisers, governmental officials and representatives of international organizations understood how decisions were adopted in Russia, they might have been more effective. Although the infamous oligarchs and numerous corrupt officials can be blamed for poor execution of well-intentioned plans, the real fault rests with those exercising power in Russia. The Russian (Soviet) elite was able to force through policies that atomized and discredited the so-called "democratic" opposition (many of whom have acquired significant financial assets by capitalizing on their knowledge and connections), silenced the independent media, and disempowered the traditionally passive Russian population. It is a shame that Jonathan Hay and Andrei Schleifer were permitted to avoid a public trial because this deprived U.S. and Russian citizens of an opportunity to gain a better understanding of why U.S. assistance failed in many of its goals.
It remains astonishing how flippant some analysts are as they gloss over the "rise" of Mr. Putin. It is perplexing that someone who was a protégé of the largely discredited former Mayor of St. Petersburg, not only survived politically but thrived - despite the city's economic travails. It's difficult to believe that in an almost feudal society a relatively unknown, undistinguished, mid-level spy rose within a matter of months to become the absolute ruler of a huge country, with enough influence to mediating disputes between Russia's competing elites.
"Plucked" from obscurity - perhaps due to his apparent lack of any political baggage and prominent enemies (no real politician could ever have overcome opposition to promotion from head of the FSB, to Prime Minister and ultimately interim President), technical competence (handling money on behalf of leadership), clean cut appearance (after decades of the debauched leadership), phenomenal memory (allowing him to meet with and impress foreign dignitaries and to speak publicly without any chaperone) and loyalty (demonstrated through decades of anonymous KGB service that was the guarantee that his appointment would not be a repetition of the mistake made with Stalin) -- his task has been to put a civilized face on the largely untransformed country.
Mr. Putin has done an outstanding job fulfilling his assignments. Mr. Putin was not chosen to serve as President in order to promote democracy. What is remarkable is how frank, daresay honest, Mr. Putin was in publicly stating the ruling elite's objectives. The agenda was announced in the best tradition of ambiguous Soviet propaganda: the establishment of a "vertical of power" and the "dictatorship of law" (not "rule of law"). What some specialists on Russia see as political "errors" are in fact evidence of a consistent, if meandering, course of action. Mr. Putin's "errors" in carrying out the plan should not be characterized as failure. The silencing of Mikhail Khodorkovsky is the best known of these actions intended to ensure political conformity, but indications are that the cost was not excessive.
The Beslan massacre of children has reinforced the population's willingness to stay the course in Chechnya. There are few remaining voices in the media to provide contrary views. The country is relatively unified in the belief that one does not negotiate with terrorists.
The sacrifice of a few lives and bad PR are something that Russia's current rulers have survived for decades, and are a price that they will gladly pay for their greater goals. The Ukrainian elections, while handled ineptly, were primarily the fault of the local security services in Ukraine who were entrusted with the task of fixing the elections. Putin's open endorsement of one candidate, while viewed with trepidation here, could not possibly have been a clearer, less ambiguous signal to Russians and the near abroad about the country's foreign policy direction. The "failed" social payments reforms are strikingly Soviet in style. While we see that they achieved nothing, they actually promoted the Russian government's goals of disengaging itself from costly social spending in the name of economic reform (and thus benefiting the ruling elite).
Rather than attribute all of these "failures" to a powerful Mr. Putin, Dr. Aslund should listen to what his "friend" in the Russian elite is telling him. "A former senior Russian official told me recently that within Putin's KGB circle, Putin is not considered the leader," he writes. Well, it's too bad that he has only heard this recently. Many observers have been hearing the same from both well-positioned people as well as disenchanted intellectuals virtually from the moment Putin took office. This does not necessarily mean that Putin is in disgrace. It means he is not the leader most of the world takes him for.
Sometimes words just mean what they mean. Ironically, the leadership's steadfast pursuit of policies that Dr. Aslund deems to be failures hardly indicates increasing instability in the near-term. If Mr. Putin turns out to be a popular spokesperson for the leadership, they will find a way for him to stay. If not, they will find an equally untarnished, unambitious and popular figure to replace him and to press on with the concentration of financial and political decision-making.
Since Dr. Aslund concludes that Mr. Putin's decreasing popularity somehow is a measure of regime instability, he recommends pressing on the pro-democracy front, that was so incompetently supported during the first (and far more promising) ten years of reform. Aside from the fact that the Russian security services have more than amply demonstrated how adept they are at manipulating elections during the two Putin victories (making Dr. Aslund's call for more election monitoring pointless, especially if there are no consequences for the Russian leadership if it orchestrates fraudulent elections) we can hardly imagine a more visible, less productive way to spend money and increase the ire of a resurgent Russian leadership than this.
Second, flawed though Russian foreign policy may be, it is trumped by foreign dependency on Russian energy (if only Mr. Reagan had not abolished the Energy Security Corporation during his first term). The Russian authorities have learned how to acquire and manipulate "soft power" (sometimes not so soft) especially in regards to the near abroad. Though the former Soviet republics may have acquired political independence, Western specialists should be looking a bit more attentively at their economic dependence on Russia, which Russia has deftly and professionally increased for well over a decade.
Third, we certainly agree that among our common interests, the nonproliferation of weapons of mass destruction is among the most important. There are only two ways to solve this problem in Russia: either the West can pour massive amounts of money into Russia to enable scientists, soldiers, politicians and businessmen to find a lucrative alternative to selling their products and services to rogue states -- a practice that has come into disrepute for a number of reasons -- or Russia can re-establish the authoritarian controls over society that minimize the leakage of such technologies in the Soviet period.
As far as Russia's membership in the WTO goes, aside from overcoming some lingering national sense of inferiority, it is very difficult to see how this is going to promote reforms in Russia. The only arenas that the Russian leadership has left more or less free for development are small businesses and services. When the WTO membership rules go into effect, it is inconceivable that the free entrance of well-financed, well-managed foreign competitors on the Russian market will not decimate these sectors. When that happens, commodity-exporter Russia will become embroiled in some nasty trade disputes that could wreak havoc on trade flows. And just as happened a decade ago when Dr. Aslund was advising the Russian leadership, Western promoted legislative reform (in the form of pressure and support from the WTO) promulgated from above will have absolutely no positive effect in the country. It certainly won't promote democratic reforms in Russia!
Dr. Aslund concludes with a questionable analysis of the Russian oil and gas industries. Contrary to "Putin's KGB friends" having seized control over Russia's state-owned energy companies (directly or indirectly), it has been the intention of those "KGB friends", who never relinquished control over these key sectors of the economy, to re-establish state ownership of large and strategic industries. This is what is happening today. In what might be the ultimate irony, this strategy, though successful in the short run, is likely to result in a situation greatly resembling, that which brought down the Soviet Union in the first place, namely, excessively centralized economic decision-making.
This is an extremely workable situation for Western companies, willing to operate in Russia under the peculiar terms of Russian business that have prevailed for decades. Multinational corporations prefer to do business in stable environments. Russia can be a very profitable market for Western parties that have the proper connections and realistic expectations. In many ways, Russia is returning to what it was before the collapse of the Soviet Union sans ideology, an inefficient, centralized corporate state that has relied upon the abundance of its (some would say squandered) natural resources to keep going.
We are not suggesting that Russia will not cooperate with the U.S., especially when it serves its purposes (the same can be said of the US). Nor does this mean that foreign businesses outside the natural resource and commodity sectors will not find major opportunities to do business in Russia (especially when there are no Russian enterprises capable of providing the same goods or services). IKEA is a wonderful example of a company thriving in the Moscow consumer market, mainly because it is a long way from having a domestic Russian competitor. We are saying, however, that the most effective way to promote positive change in Russia at this late date may simply be to encourage the development of ordinary and business ties, involving an ever larger number of rank-and-file Russians in the global economy, and to hope for a gradual change. Foreign participants engaged in business in Russia must remember that if their counterparts or the State cause them harm, they probably will be no way for them to vindicate their rights.