Can Russia Reform? Economic, Political, and Military Perspectives
RUSSIA'S CHOICE: CHANGE OR DEGRADATION?
Lilia Shevtsova - Dr. Stephen J. Blank, Editor - Strategic Studies Institute, U.S. Army War College - 6.7.12 - JRL 2012-114

Edited by Dr. Stephen J. Blank
Strategic Studies Institute
U.S. Army War College
June 7, 2012

http://www.strategicstudiesinstitute.army.mil/pubs/display.cfm?pubID=1111

CHAPTER 1
RUSSIA'S CHOICE: CHANGE OR DEGRADATION?
By Lilia Shevtsova

LILIA SHEVTSOVA is Chair of the Domestic Policy Program, Moscow Carnegie Center, and Associate Fellow at the Chatham House, the Royal Institute for International Affairs. She is author of several books, including Yeltsin's Russia: Myths and Illusions; Putin's Russia; RussiaLost in Transition: The Yeltsin and Putin Legacies; Lonely Superpower, Change or Decay: Russia's Dilemma's and the West's Response (in co-authorship with Andrew Wood).

[DJ: Footnotes not here] Map of Russia

The December 2011 protests have proved that Russia has come to the point when the most educated and forward looking segments of the society are starting to realize that the personalized power system's continued existence is leading to national and social degradation with potentially dramatic consequences for the country. But this growing awareness has not yet produced any alternative that could secure broad political and public support, and Russia thus continues down its destructive road. Moreover, Vladimir Putin's ruling team is going to reproduce the system during the December 2011 and March 2012 "managed" elections.

In this chapter, I reflect on the nature of Russia's political system, the external factors influencing its existence, the strategic implications of its degradation and the prospects for its transformation.

SURVIVING WITHOUT CHANGE

Russia let slip an opportunity for liberal transformation at the moment the Soviet Union collapsed. A number of circumstances complicated Russia's transition to liberal democracy: history, traditions, culture, an anti-Western nationalism, the need to accomplish four revolutions (create a free market, build a new state, democratize the regime, and let go of an imperial identity), reluctance to part with any sliver of its sovereignty in order to integrate into Europe, and Europe's own unwillingness to offer effective external incentives for Russia's transformation. At the start of the 20th century, it was Russian society that was not yet ready to leave the traditional system behind, but at the start of the 1990s, it was the Russian elite that were not ready for this transformation. As the communist era came to an end, the blame for the failure of Russia's liberalization appeared to lie largely with the seemingly liberal and democratic-minded groups, who proved unable to offer society an alternative and placed their hopes instead on a leader (Boris Yeltsin), thus paving the way to a revival of the personalized power model.

The Yeltsin, Putin, and Dmitry Medvedev presidencies saw the consolidation of a system based on three fundamental principles borrowed from the past (the Russian Matrix): personalized power, a merger between government and property, and the atavism of great power mentality (derzhavnichestvo) with its claims to "spheres of influence." This system's builders gave it a makeover, however, wrapping up the old concepts in a new packaging that imitated the principles on which Western civilization is based. One cannot deny the Russian elite's sense of irony anyway: they managed to create an alternative to liberal civilization by imitating it. New Russia's rulers had not only to establish their hold on power, but also to ensure that no challenge to their monopoly will arise and they do so through the crucial instrument of managed elections. The Russian elite took the liberal election principle of "certain rules and uncertain results" and turned it on its head, putting in place an electoral system based on "uncertain rules and certain results." Elections devoid of political competition but where the authorities manipulate public opinion have become a means for guaranteeing the ruling elite's monopoly hold on power.

One might ask, what happened to that other pillar of the traditional matrix, militarism, which over time had become such an intrinsic part of the existence of Russia's state and society? Historically, militarism, and more specifically the constant search for an outside enemy, was not just the cornerstone of Russian foreign policy, but also a means of consolidating elite control over the population and part of daily life. After the collapse of the Soviet Union, the Kremlin abandoned the doctrine of total military confrontation with the West, but retained aspects and symbols of militarism, which still often impose their logic on the current system.

Today's new-look Russian system presents several salient features, in particular the hybridization of economic, social, political, and foreign policy. This is reflected in adherence to mutually exclusive principles, such as market and state control, paternalism and Social Darwinism, and cooperation with and rejection of the West. Ambiguous principles, absence of a clear direction, the constant game of "Let's pretend!" have become a new Russian way of life. Meanwhile, having abandoned ideology in typically post-modernist fashion, the Russian elite adopted pragmatism as its credo, which it proclaims as its guiding light and source of pride.

The Russian elite has also demonstrated considerable tactical skills. Let us not forget, though, that clever tactics often mask an absence of strategic vision. The authorities swing between repressive action and co-opting of representatives of various social and political groups (nationalists, leftists, and liberals) into the Kremlin's orbit, thus discrediting the political currents they represent. The Kremlin has long realized that any rhetoric and slogans can be manipulated for the purpose of nipping the emergence of any opposition in the bud. The elite use the impression of a change in leadership, for example, to maintain its monopoly. Putin did not try to guarantee his hold on power by the blatantly unconstitutional means of running for a third term in office as president, but instead took the prime minister's job and set up a tandem structure with Medvedev, while keeping the real power in his handsthis was a new way of reproducing the same regime. The Kremlin also alternates between Russia's "special path," and a supposed desire for European integration. These constant zigzags and mutually exclusive slogans demoralize and disorient society, undermine its confidence in the future, and leave no solid ground on which any real alternative can develop. In this unclear situation, the authorities look like the only guarantor of stability. This imitation-based system has proven an effective means of maintaining the current ruling team in power. But its categorical rejection of the principles of freedom and competition undermine any hopes for and attempts at renewal and modernization from inside.

Russia's post-modern experiments have disproved a number of axioms on democratic transition and hybrid regimes. The fathers of democratic transition theory held the view that, as Samuel Huntington said, "the halfway house does not stand."1 One could certainly imagine that hybrid systems built on mutually exclusive principles cannot be stable and will eventually start to wobble. But this kind of political death can be a very drawn-out process, it turns out. Indeed, it can be precisely the existence of these mutually exclusive principles that prolong the life of such hybrids. For example, the personal freedoms that let Russia's people live their lives independent of the authorities (under the condition that they do not meddle in politics) and Russia's relative openness to the outside world lead to apathy, emigration, and/or withdrawal into personal life rather than to society trying to expand its freedoms. Instead of helping to shape and develop democratic habits, imitation of democratic institutions and liberal rhetoric only discredits democratic principles. Theorists say that the middle class is the foundation of liberal democracy, but in Russia the middle class provides the support for the centralized state. Another purely Russian paradox that helps to keep the personalized power alive is the destruction of traditions and stereotypes existing before the Bolshevik revolution of 1917. The Communist period eradicated this old mindset, but the Russian society it produced, now atomized and deprived of its traditional social bonds and aspirations, is inclined towards a new form of monopoly hold on power as a means of survival.

The West also plays a prominent part in keeping Russia's authoritarianism alive. The Russian elite's opportunities for personal integration in Western society (as exemplified by Roman Abramovich, former governor of Chukotka and now one of Britain's wealthiest citizens), joint projects between Western and Russian business, the efforts to draw Western intellectuals into the projects of the Russian authorities, and the involvement of Western political circles' in corrupt deals with the Russian eliteall play a part in helping to keep the system afloat.

RUSSIA AS THE WEST'S PARTNER AND OPPONENT

Foreign and security policy are other instruments the Russian system uses to keep itself going. The nature and role of Russia's foreign and security policy come through above all in Russia's relations with the West. This is only natural, as it is Western civilization that provides the alternative to Russia's political model and at the same time the West is a refuge place for the Russian elite. No matter whether or not Russian foreign policy takes the form of dialogue or confrontation with the West, its aim remains to keep in place a personalized power system that is inherently hostile to liberal democracy. The optimists who get excited every time the Kremlin starts cooperating with Western partners would do well to remember this.

Let us deliberate on how the domestic agenda influences foreign and security policies and makes them its own instrument. The key goal of the Russian system domestically is to preserve the status quo, and first of all, the ruling elite's monopoly on power. Foreign and security policies have to: 1) guarantee a benevolent international environment for the Russian system and its international legitimacy (the latter becomes crucial in the situation when the system is losing its domestic legitimacy); 2) deliver additional drivers for society's consolidation around the authorities; 3) secure economic resources to support the system; and, 4) guarantee ways for personal integration of the Russian elite with the Western society (this goal is new compared with the Soviet survival mechanism).

Foreign and security policies have to pursue contradictory paths. For the outside, these policies have to create the image of Russia as a modern and responsible European state. For the inside, foreign policy has to supply constant justification for the "Besieged Fortress" mentality and secure rejection of the Western standards by the Russian society. This "driving two horses in opposite directions" is actually the agenda of Russian foreign and security policies that the Kremlin has been pursing with great skill during the last 10 years. This agenda is instrumental for reproduction of the centralized state and personalized power that cannot exist without an alien environment. One thing has to be added: foreign and security policy reproduces fears, phobias, and complexes dominant in the Russian domestic policy, which transfers into the realm of Russia's relations with other states: suspicion, arrogance, attempts to demonstrate might and at the same time the Kremlin's lack of vision and ability to forecast the consequences of its actions. One could risk the conclusion that the Kremlin foreign and security policies are more influenced by domestic needs than by the logic of international relations. This is what makes Russia such a difficult partner, forcing other states to view Russian international behavior through the prism of the Russian domestic trajectory. This creates puzzling situations when, from all points of view, Russia acts against common reason, ruining its own reputation as it is doing, for instance, in its relations with Georgia, recognizing the occupied territories as independent states. But these actions could be easily predicted and explained if one will look at the needs of the Russian system and its personalized power.

Over the last 20 years, the Russian elite has developed a foreign policy model that one could define as "together with the West (and even within the West) and against the West at the same time."2 Depending on the circumstances at home and abroad, the Russian authorities shift the emphasis between different aspects of this contradictory model. But no matter what line the Kremlin takes with regard to the West, its main domestic goal remains unchanged: to structure the Russian society on the basis of principles alien to the West. The authorities can tone down this anti-Western inclination during periods of dialogue and cooperation, but will never give up encouraging anti-Western attitudes among the Russian public, continuing to pursue "the Besieged Fortress" paradigm. In analyzing Russia's foreign policy, one should not forget at the same time that this is the policy of the Kremlin, and the country's ruling elite is not representative of Russia as a country. Russian society comprises a wide range of groups, and large sections of the public do not necessarily share the authorities' views on various foreign policy and security issues.

The Kremlin's foreign and security policy has gone through phases corresponding to the stages in the formation of the Russian political system. During the first phase (199193), when the Yeltsin team had not yet renounced its highly amorphous democratic aspirations, the Kremlin tried to set Russia on a course of integration with the West. The policy was too contradictory and vague, however, as even during this time Russia's elite, including the liberals, still held on to great-power ambitions and the Soviet behavior model. In fact, during this stage the Kremlin tried to integrate Russia into the West on its own terms.
In a second phase (199399), Russia was engaged in dialogue with the West, but at the same time one could see that the Russian elite returned to its usual suspicion with respect to the West. Moreover, the Kremlin started to use elements of containment trying to prevent North Atlantic Treaty Organization (NATO) enlargement. The Russian system had already taken on its main outlines by this time, with power based around a single leader who relied on a corrupted oligarchy for support. This regime saw elements of the great-power mentality return to the fore.

In a third phase (2000-04), Putin made attempts to establish a partnership with the West based on Realpolitik, hoping to become an equal member of the Western club while retaining the monopolist power system in Russia and holding on to its neo-imperial aspirations. James Sherr rightly pointed out that there was in this "a strong geo-economic emphasis."3 In Putin's view, this geo-economic leaning had to become the new basis for returning to the first echelon of the global actors. Although Putin's version of Realpolitik found support in the West, the Kremlin was unhappy with the results in the end. Putin did not see signs that his Western partners were ready to treat him as an equal and endorse partnership with Russia on the Kremlin's conditions.

In 2004-08, a new fourth stage in Russia's foreign policy development began. The Orange revolution in Ukraine was a watershed that pushed the Kremlin into taking a more aggressive line in its relations with the West. I doubt that Putin actually believed that Western countries planned and organized Ukraine's upheavals. Rather, Moscow used the events in Kiev as a justification for its increasing dissatisfaction with the West, this on the back of a burst of self-confidence brought on by rising oil prices and Putin's growing domestic popularity. The Russian elite had the sense at that moment of a "Russia risen from its knees," and a large part of the public shared this view. Putin's team concluded that the time had come when Russia held the upper hand and could dictate its rules to the West. 10

Dmitry Trenin described the Kremlin's new course as an "imposed partnership" and defined the conditions Putin laid before the West: "Take us as we are and do not meddle in our internal affairs; accept us as your equals; in areas where our interests meet only compromise solutions can be considered. We will make concessions only if you do too."4 I would add a few more conditions to this list: respect Russia's right to a sphere of influence in the post-Soviet area, conclude wi th Russia energy-security agreements that would guarantee it long-term contracts for energy supplies and ensure favorable conditions for Russian business in Western markets.

Putin not only formed Russia's new foreign policy doctrine but also succeeded in turning it into the main factor in consolidating the Russian society. He definitely felt that foreign policy could be used more aggressively to pursue a domestic agenda. On the outside, Putin's doctrine looked like a very contradictory cocktail. Its main theses, set out on various occasions by Putin and Foreign Minister Lavrov, can be summed up as follows: the existing system of international relations is outdated, Russia proposes establishing a new tripartite world government together with the United States and the European Union (EU) that can steer the global boat forward, and Russia calls for "networking diplomacy" and a renunciation of old alliances (above all, NATO).

In return, Moscow was ready to take into account Western business interests in Russia. In February 2007, Putin delivered his famous Munich, Germany, speech that was an attempt to force the West to accept the new role of Russia and its terms of partnership. Putin declared that "the world has reached a decisive moment when we need to give serious thought to the entire global security structure." This speech was an ultimatum that made clear Russia's willingness to risk worsening relations with the West if it refused to accept the Kremlin package, i.e., its proposal to revise the rules of the game established after 1991.

This rhetoric made it clear that by 2007 Russia had become a revisionist power. Moscow demanded a return to some aspects of the bipolar world that existed before the collapse of the Soviet Union. In essence, this was a demand to recognize Russia's right to a new format of neo-imperialist policy. No, this is not imperialism any more. This is a "post-imperialist syndrome," some would say. I would argue that if the goals of this policy are to influence domestic developments in neighboring countries using not only soft power but tough pressure, this is definitely a variation of imperialism. But at the same time, Moscow tried to avoid the confrontation that characterized the Cold War era.

Before 2004, the Kremlin was satisfied with the role of enabler and spoiler. From 2004, Putin's team wanted more leverage. In his analysis of the Chinese domestic and foreign policy, Bobo Lo wrote that China has been trying to assert its status as a global player while "absolving it(self) of leadership responsibilities," which means that China wants "to sit in the front of the car, but doesn't want to drive."5 Putin's team offered a much more ambitious agenda for Russia: they wanted it to be part of the global leadership and wanted to "drive the car." True, the Kremlin planned to drive the car together with the United States and the EU (though, the Russian team never took the EU seriously).

Most Russian politicians and experts at the time based the Russian foreign policy revisionism on geopolitical argumentsRussia's growing power, Western weakness, the need to ensure respect of Russia's national interests, and the desire to make up for past humiliations. But there was also the position set out by Foreign Minister Sergei Lavrov, who declared that the domination of Anglo-Saxon values was over and that an era of competition in the "civilization dimension" has begun. Not so long ago, members of the Russian elite had been talking about how they accepted liberal principles but applied them in accordance with Russia's specific conditions. During Putin's second presidency, they started to lay claim to their own value system, though it remained unclear exactly what values they had in mind.

One could conclude at that time that the Kremlin wanted to establish Russia's status in a space somewhere between the West and the rest of the world, one that would give it the chance to play by its own rules, which were not always clear and certain. One fact, though, was apparent: the Kremlin's ambition was to have an independent system with satellites in Russia's orbit. At the same time, Moscow wanted to be part of Western decisionmaking mechanisms without making any commitments to the West.

Putin's team wanted to ensure themselves a place in the global governance with the West. This implied a proposal to the West to return to a balance of power, but with a Western guarantee that it would hold itself back with regard to Russia while recognizing the country's right to have its sphere of influence. The Western leaders were hardly prepared for this unusual paradigm. This macho foreign policy model became a powerful factor in Russian domestic affairs that had to legitimize the Kremlin's political regime. In the absence of ideology and an attractive domestic agenda, the foreign policy doctrine had to ensure the interests of the Russian rentier class, the raw-materials model of capitalism, and an authoritarian government. One could hardly fail to notice an interesting phenomenon: While seeking to maintain the status quo inside Russia and keep the ruling team in power, the Kremlin was attempting to revise the status quo that emerged in the world after the Soviet collapse. Being a dogmatist and a revisionist at the same time has become the Kremlin's credo. Taking a look at the Russian elite's rhetoric in 200607, one could see statements such as "Russia cannot take any one side in the conflict of civilizations. Russia is ready to act as a bridge." The Kremlin choice of words--mediator, bridge, superpower, network diplomacy, and geopolitical triangle--illustrated the reigning mood among the Russian ruling team at the time.

The Kremlin's offensive worked. The Russian elite succeeded in forming a fairly broad range of instruments of influence in the West that continues to work today. It includes co-opting Western business and intellectual representatives into their own network, playing on the contradictions between Western countries, imitating the West and making use of Western double standards to justify Russian double standards. This has become a clear model of a ruling class that wants to have all the benefits the Western world can offer but at the same time rejects its standards. Moscow could defend Serbia's territorial integrity but at the same time undermine Georgia's and threaten to split Ukraine. Russia could take part in the RussiaNATO Council but at the same time consider NATO its enemy. Meanwhile, Western leaders have failed to offer an antidote to the Kremlin's game. 14

ATTEMPTS TO MODERNIZE THE SYSTEM AND ITS FOREIGN POLICY SUPPORT

The global economic crisis in 2008 forced Putin's team to tone down its ambitions and ushered in a new phase in the Kremlin's foreign and security policy development. The authorities realized that the domestic status quo was fragile and the economy in need of modernization. This required a change of tactics, and they therefore laid aside for the time being attempts to blackmail and intimidate the West. They concluded that what Russia needed to do was to make use of financial and technological opportunities offered by the West to overcome its backwardness, following a formula that was used successfully on two previous occasions in Russian historyby Peter the Great and Joseph Stalin. The Kremlin decided to attempt for the third time to use the West in bringing about post-industrial modernization while not changing the system itself, i.e., without expanding freedom and competition.

The "reset" in RussianU.S. and RussianEU relations provided the authorities with the ideal tool for carrying out their plans. Medvedev's arrival in the Kremlin gave this new model of relations a political basis. The cooling in ties during Putin's presidency had come to an end and the mood in the West was generally hopeful and looking to Medvedev's supposedly pro-Western aspirations and liberal views. Henry Kissinger wrote enthusiastically that "we are witnessing one of the most promising periods in Russian history."

It soon became clear, however, that hopes that Medvedev would become the architect of a new breakthrough with the West were greatly exaggerated.

Those who hoped that new president could set in motion a pro-Western shift in the Kremlin were failing to see the obvious.

During the war against Georgia in 2008, Medvedev sounded more hard-line in his anti-American and anti-Georgian declarations than Putin, the senior Russian leader. Medvedev put forward five principles for Russia's foreign policy, among which was Russia's right to take action beyond its borders to protect the lives and dignity of Russian citizens wherever they may be, and to pay special attention to specific regions where Russia has "privileged interests." This clearly showed a desire to re-establish the historic buffer zone around Russia and proved that Medvedev has been working within the same foreign policy model as Putin. It was after Medvedev's arrival in the Kremlin that Russia began threatening to take measures in response to American missile defense plans in Europe, in particular by deploying Iskander missiles in the Kaliningrad Region. It was also under Medvedev that the latest gas war between Russia and Ukraine flared up at the start of 2009. Medvedev threatened Ukraine's President Viktor Yushchenko. For all the economic contradictions between the two sides and Kiev's ambiguous position, there was no doubt that Moscow's tough approach to the dispute pursued the political objective of destabilizing the situation in Ukraine and influencing the political struggle for power in that country and at the same time discrediting Ukraine in the West's eyes and thus blocking its road to Europe.

Medvedev's idea of a new binding treaty on European security and his explanation of his understanding of this security arrangement has been the continuation of an approach typical of Putin. It was not hard to see the Kremlin's intentto prevent NATO expansion, put the Alliance outside the European security system, and at the same time draw the European countries into long years of senseless negotiations with Moscow on the format of a new security agenda. True, quite a few Western and Russian observers prefer not to notice the Putin-Medvedev continuity in foreign and security policy. They prefer to stress the "reset" signs. Supporters of the reset have several arguments. They point to the normalization of RussianU.S. relations, which is of course a positive step in itself.

Russia has normalized its relations with Poland, too. Moscow decided not to torpedo United Nations (UN) Security Council Resolution 1973 on Libya, giving the Western allies the chance to try to stop Muammar Gadhafi's war against his own people. I agree that the efforts to overcome the tensions in Russia's relations with the West and the Russian neighbors during Medvedev's presidency are positive. But the point I want to get across is that this change in tone and even in tactics does not reflect any fundamental transformation in Russia's foreign policy doctrine and its domestic roots. Without such a change, we can view the reset policy as simply a tactical move on the Kremlin's part. The new tactics have their cause: the Russian authorities are trying to breathe new life into a disintegrating system that is inherently hostile to Western civilization and to the interests of Russian society. The reset simply turned out to be the most effective means of achieving these objectives.

Moreover, Medvedev's lack of real powers and his never going outside the role of the "chair-warmer" for Putin during his presidency only proved that his foreign and security policy initiatives have been part of Putin's survival project. If one looks attentively at Putin-Medvedev politics (I mean the real decisions and actions, not the rhetoric), one would see that the Russian ruling group has been constantly moving in various directions: to the right, to the left, forward, and back. This fits the logic of a hybrid system made up of opposing tendencies. The reset policy of the tandem formula was an attempt to solve the problem of the Russian economic modernization. But there are other imperatives as well, first of all the need to preserve monopoly on power. There is no other way to do it without returning back to the usual tricksearching for an enemy. Thus, at any moment the Kremlin can push the button labeled "Cold Shower."

CAN THE 'RESET' CHANGE THE RUSSIAN SYSTEM?

Reflection on Russia's foreign and security policy brings a number of questions to the fore. One of them asks whether foreign policy interests or internal political logic is the determinant factor? What led to the strain in relations between Russia and the West during NATO's period of expansion and the Kosovo crisis, for example? Most Russian observers would blame the West's policies, but I would say that the logic the Russian system follows is to blame. If alienation from Western civilization was not essential for keeping the Russian power system in place, NATO's eastward expansion would not be perceived as a threat. On the contrary, Russia would even seek to join the organization, perhaps, and the idea of NATO drawing closer would not generate so many negative emotions. Eastern European countries would perhaps not have been so eager to rush into NATO's embrace in the first place, as they did in fear of an undemocratic Russia. If the Russian authorities had changed their attitude to the value of human life and human rights, they would not have tried to support Slobodan Milosevic, and the Kosovo crisis would not have taken such a dramatic turn. The reasons for the cooling in relations between Russia and the West during this period thus lie, above all, within Russia itself. It was the Russian system's internal logic that made foreign policy differences so antagonistic. The same reasons explain the cooling of the relationship in 2000-08this was the work of the Russian matrix.

Another question is, can the "reset" in Russia's relations with the United States and the EU lay the foundation for a more solid and lasting partnership? How should one assess the numerous initiatives that seek to establish a new partnership model or at least promote cooperation between Russia and the West? A few of these initiatives are worth recalling. Igor Ivanov, Wolfgang Ischinger, and Sam Nunn, for example, proposed a "new approach" to resolving Europe's security issues and a "thorough reorganization of the existing institutions, including the EU and NATO." This proposal is in the spirit of Medvedev's initiative to establish new European security organizations that would weaken NATO. For their part, Igor Yurgens and Oksana Antonenko proposed a new NATO-Russia Strategic Concept and pursuit of confidence building measures between the two sides. There have also been the proposals that keep coming up to give Russia membership in NATO. It is hard to object to measures that would build greater confidence between the two sides, but the question is, how realistically can they be actually carried out if the principles and standards the two sides pursue are fundamentally alien to each other? Achieving real change in relations would require real change in the principles underpinning Russia's foreign policy, that is to say, real change to the regime's interests and nature.

Could external factors act as the impetus for such change? During Mikhail Gorbachev's time, the winding down of the Cold War certainly gave impetus to internal liberalization in the Union of Soviet Socialist Republics (USSR). But let us not forget that Gorbachev himself realized the need to end confrontation with the West because he understood that this was harming the Soviet Union and depriving it of sources of growth and development. In short, internal considerations were the primary factor in forming "the New Thinking" that emerged under Gorbachev. Today, too, Russia's foreign policy will change only if the principles that form the foundation of the Russian system also change. Partial solutions such as cooperation between Russia and the West on missile defense or addressing the Iranian and North Korean nuclear programs can serve as the basis for nothing more than a temporary warming in relations and pursuing tactical interests together. They cannot produce lasting and stable cooperation.

This does not mean that tactical measures that strengthen confidence between the two sides are not needed. But to think that such measures will fundamentally change relations is an illusion, and it is precisely such illusions that help the Russian monopolist power system to stay alive.

For now, things are clearly incompatible. Medvedev has been speaking of a successful reset (while Putin has been complaining that the reset did not bring what Russia had anticipated), while at the same time approving a new Military Doctrine (in February 2010) that names as the main threats to Russia's security "NATO's desire to extend the military organization of its member countries closer to Russia's borders" and "attempts [by Western countries] to destabilize the situation in particular countries," deployment of military contingents "on the territory of countries neighboring Russia" and "the creation of a missile defense system." In other words, containing the West is the Military Doctrine's main goal. Indeed, it sets the objective not just of containing the West, but of preparing for future wars in space. Wars with whom? With the West, of course! "Air and space defense . . . is not a deterrent instrument but a policy of preparing for a major war against the main powers and alliances in the world," warned Alexei Arbatov, giving his assessment of the Military Doctrine's primary objectives.

The reset thus does not change the essence of the Kremlin's foreign policy paradigm. So long as the Russian authorities still hope to use the West to support Russia's modernization efforts, one can expect the Kremlin to refrain from an aggressive line. In any case, the Russian elite's new means of survival through integration at the personal level into the Western community neutralizes the threat of a new cold war. The Russian elite is not devoid of common sense, after all, and it realizes that Russia's possibilities are limited; it is clearly not about to take any suicidal steps. But the Kremlin's pragmatism did not prevent the sharp cooling in Russia's relations with its Western partners in 2004-07. A number of internal factors force the Russian authorities to turn up the anti-Western rhetoric again. First among these are the parliamentary and presidential elections in 2011 and 2012. Russia's elections are always accompanied by a dose of the rhetoric of the "besieged fortress." There is a new phenomenon to consider too, namely, the public's growing discontent with the country's leaders, including Putin. In this situation, and with social problems on the rise too, the Kremlin's anti-Western rhetoric will only increase. Faced with dwindling possibilities for pepping up the public, the Russian authorities always start looking for an enemy, and the obvious candidate among Russia's potential enemies is the United States, of course.

Surveys in January 2011 showed that 70 percent of respondents think that Russia has enemies. This shows that the mentality typical of the militarist paradigm of state life endures. Who are these enemies today? Chechen terrorists were named by 48 percent of respondents, while 40 percent named the United States, 32 percent said NATO, and 30 percent "some forces in the West." Despite the reset, 65 percent consider the United States an aggressor that seeks to take control of the entire world. The Soviet model of relations with the United States, with the Kremlin's help, thus continues to flourish today. The Kremlin's anti-Western rhetoric at home will inevitably spill over into its foreign and security policy, too.

FUTURE SCENARIOS: BETWEEN ATROPHY AND IMPLOSION

Russia's options are becoming more limited every day because the system cannot compete with Western society in innovation or ability to address global challenges. Meanwhile, the Russian elite cannot permit even limited liberalization because that would threaten its monopoly on power and property. Political pluralism and competitiveness would mean the end of history in Russia, i.e., the end of the era of personalized power. The conservative part of the Russian ruling team may try to preserve the system by wielding an iron hand and even more blatant anti-Western posturing. The iron hand scenario will be more likely in case the authorities start to lose control over the Russian developments. The more liberal part of the political class oriented toward dialogue with the West may not support the repressive scenario (though this is not certain). But could it consolidate its position so as to prevent the emergence of a stronger form of authoritarianism or even neototalitarianism? The answer is not clear. This is not a potential clash of ideologies or even of political orientations, but a clash of different ways of existence for the same rentier class. However, even if the iron hand scenario prevails, it is unlikely that the traditionalists will be able to hold on to power for long. Russia does not have the prerequisites for that, such as the willingness of the political class to isolate the country completely, reliable power structures and the public's willingness to turn Russia into North Korea. But if the ruling team chooses that path, Russia and possibly the outside world will pay a high price. Moreover, the jury is out as to how and in what shape Russia will exit from the iron hand scenario.

The more liberal segment of the Russian rentier class and a new batch of systemic reformers could try to preserve personalized power in a new form under a liberal banner. However, soft authoritarianism that undermines itself with empty liberal rhetoric will hardly be sustainable either. It does not lead to the liberal opening. Quite the contrary: this would discredit the liberal idea and pro-Western longings just like the Yeltsin presidency did. In any case, Putin's return to the Kremlin makes the option of softer authoritarianism rather doubtful. Sooner or later, Putin will have to turn to tougher measures to secure his hold on power.
Any open conflict within the Russian elite contains the seeds of hope, however weak, for the transformation of the traditional state. But a liberal breakthrough is possible only if a responsible and anti-systemic liberal opposition that will secure society's support emerges in Russia. Without that, a schism in the political class will lead to yet another mutation of the same old autocracy or will trigger the unraveling of the state. Despite growing resentment of the population and loss of credibility, Putin's ruling team has all the reasons to retain control over the country and secure the replication of its power beyond 2012. Such an outcome would mean that Russia would be stuck in growing stagnation for an indeterminate time. If oil prices remain high, society continues to be passive, business interests willingly serve the regime, the opposition stays fragmented, and the West supports the Kremlin, then degradation and atrophy is the most probable scenario for Russia at least in the next 57 years.

In a regime that is not prepared to impose mass repressive measures but is also incapable of dialogue with society, it does not matter who stands as the embodiment of political power. Nor does it matter what rhetoric or governing style the regime employs. In this scenario, economic growth in certain spheres is possible, which will create the appearance of development. Economic growth during the Putin's presidency not only did not lead to the formation of a diversified economic model, it did not halt the growth of the gap between Russia and the developed world either. The result will be continuing rot. This is the worst possible scenario. It can continue for a long time and bring total degradation of the population. The nation will lose steam and the desire to succeed. In some Russian regions, this degradation has already reached the point of no return.

Another scenario cannot be ruled outthat of a new violent implosion in Russia. With the highly centralized system recreated by Putin, dysfunction in one part can set off a chain reaction leading to a repeat of 1991. All such a chain reaction requires is an economic crisis more serious than the one that befell Russia in 2008. Even without an economic crisis, the failure of individual elements in the political system (for example, a disruption in the connection between the center and the regions) could topple the first domino and start total unraveling. Collapse of the system can also result from a series of technological catastrophes befalling Russia's Soviet-era industrial infrastructure. If you recall, the Chernobyl accident provided an incentive for Ukraine to leave the Soviet Union, making its disintegration inevitable. But both scenariosthe one of gradual rot and the one of fast implosionwill bring the collapse of the state in the end.

The Russian public is suffering government failures silently for the time being. The reason is not due to Russians' world-renowned patience, but because people do not see an alternative. But at some point people will start looking to look for it.

Surveys demonstrate that the mood of the Russian population is definitely changing. In the spring of 2011, about 84 percent of Russians said they saw no opportunity to influence political process. The majority of the population was not prepared to participate in politics, relied only on itself, and tried to avoid any contact with official structures. This proves that Russians have rid themselves of their traditional paternalism. The system and society are now drifting in opposite directions. So far, this fact has helped the system to survive, but it is worth remembering that the last time that happened, in 1991, the Soviet Union collapsed.

The fact that social anger and frustration are growing faster than the political process can channel it increases the danger of turmoil daily. At the moment, the collapse scenario seems rather unlikely. But since it is only possible to understand part of what is going on, it is reasonable to keep that scenario on the table. Using force to prolong a doomed system can only hasten its end and have devastating consequences for Russian statehood. Then again, any of the possible scenarios, including the transformational one, carries the threat of breakdown, due to the fact that Russia contains national and territorial communities that are civilizationally and culturally incompatible with each other. The North Caucasus is one example.

Fear of territorial loss and statehood implosion is a substantial obstacle to any political change. Even Westernizing liberals shudder to think that liberalization could create a repeat of the events of 1991. But it is worth noting that within Russian expert circles the idea that the current system is not likely to be reformed, and even if it is reformed as the result of the social and political protests, both options will lead to a new statehood is being already widely discussed. However, neither the Russian political class as a whole nor the public is ready for that possibility. The public, for the time being, will not support reform if it believes that reform will lead to territorial loss or a new state. But moods do change, and there may come changes of public perceptions and anticipations. Thus, it is important to deliberate now on what a new fragmentation of Russia would mean for the world. What would be the reaction of neighboring countries such as China and Turkey, or those in Central Asia and the Islamic world?

Decentralization of power in Russia is unlikely to lead to Siberia and the Far East breaking away from European Russia, but these regions will certainly seek greater autonomy and a greater influence on foreign policy. It is entirely possible these regions' relations with China, Japan, South and North Korea, and the United States will become far more important in their eyes than relations with European Russia. The future of Russia's nuclear facilities and industry is another issue as far as future developments go, and could become a problem every bit as serious as the Iranian nuclear issue. Lax security and safety measures at nuclear-waste storage sites in Russia already threaten the lives of local people and in a situation of growing chaos and lack of control could become an even greater danger.

The consequences of Russia's existence as a civilizational hybrid imitating the West are already starting to make themselves felt now. Russia is not a direct military threat to the West, and this lulls the West into a false security with regard to Russia. A civilizational hybrid of Russia's type can have an indirect effect on the prospects for liberal democracy in other countries. Mikhail Khodorkovsky rightly warned that Russia has become a big exporter not just of commodities, but also of corruption. The Russian elite, having integrated at the personal level into Western society, have already succeeded in turning some Western financial organizations into a money-laundering machine. There is now a unique situation in which the Western elite tries to educate the Russian political class about the principles of liberal democracy, while this same political class turns these principles into an imitation. This could become a real threat to Western civilization itself.

BUILD-UP OF SUSPENSE

The paradoxone of manyis that those factors that helped to strengthen the Russian system have begun to undermine it. Take, for example, corruption, which until quite recently was one of the pillars of the Russian state. Today it has become a dreadful source of weakness. Corrupt police and public officials provide little support for the ruling team. The corrupt state apparatus disobeys orders from the center with impunity. The regime understands the threat posed by corruption, but taking decisive measures against it would mean rejecting the principles on which the system is built. Or consider another factor: the elections whose management the Kremlin has now mastered. Until recently, manipulating elections and falsifying their results helped to preserve continuity of power. But falsification only works when the public agrees to play "Let's pretend!" The time may come when the public says, "Enough! We don't want to play that game anymore!" That is exactly what the people of Serbia and Ukraine did.

To achieve the results it wanted in the parliamentary and presidential elections of 201112, the regime had to falsify results on much greater scale than before. That means that a regime based on blatantly rigged elections will lose all pretense to legitimacy. The only way it will be able to hold on to power is through applying more broadly the means of repression. But the state is not ready for repression on a massive scale. No matter how hard the political class tries to keep Russia drifting through the zone of uncertainty, sooner or later it will have to acknowledge that the present Pseudo-Project has exhausted itself. A state that satisfies narrow vested interests while pretending that it is

satisfying national ones, and which has no resources to shut society from the outside world is doomed, and its use of imitation to survive only increases the danger of its inevitable collapse.

It is not clear how the traditionalists in the Russian elite would behave in a crisis. But the probability is high that they will try to use foreign policy tools in a power struggle. It is hard to tell what form that might take: conflicts with neighbors, using foreign "hot spots" to provoke tension, new "gas wars," or a new chill in the relationship with the West, and accusations that it is guilty of the Russian misfortunes. What is important is that a system that replicates itself by nursing its great-power ambitions, and which is based on anti-Western sentiments, will not be able to give either up easily.

In any case, the current "reset" should not make either Russia or the outside world complacent. The new warmth between the Russian state and the outside world can hardly be sustainable if the Russian elite continues to view the West as a foe that has to be deterred and the country's neighbors as satellites who belong to its sphere of influence. The honeymoon can continue only if the Western powers accept the Russian way of dealing with the world.

Meanwhile, the time is approaching when the Russian regime will not be able to provide the standard of living and consumerist lifestyle that the most dynamic strata of Russian society have come to expect over the past 20 years. The social base of the system, which has kept things stable throughout the PutinMedvedev period, may be undermined at any moment. Revolutions take place when people have lost all hope in the future and when improvement gives way to falling living standards for the population. The relative openness of Russian society can contribute to undermining stability: people will compare the situation in Europe and Russia and see that the comparison is increasingly not in Russia's favor. One of the causes of discontent in Ukraine in 2004 was the comparison Ukrainians made between themselves and their increasingly prosperous Polish neighbors.
There are questions that will come up on the agenda very soon. One of them is what would be the personal fate of Russia's leaders if upheaval were to begin in the country? How would the world in general react if the Russian people took to the streets and the Kremlin decided to use force to suppress them? The West would do well to reflect on these issues ahead of time and not end up wavering in its response, as during the Arab revolutions. Should they put in place conditions that would enable Russia's leaders to depart peacefully, and guarantee them safety outside Russia? How to avoid Russia following the Gadhafi or the Assad scenarios, in which a leader driven into a corner resorts to civil war and bloodshed? These questions could come up sooner than is commonly thought.

Attempts to build stable and constructive relations between Russia and the West will either fail or produce imitation mechanisms in Russia so long as they do not address the root links between the country's internal development and its behavior on the world stage. Understanding these links will at least help to predict possible zigzags in relations and to understand Russian motivations. The West will eventually have to come to the realization that the Russian system is doomed and that the search for a new development model in Russia is inevitable. This will be a difficult, painful, and dramatic process. The West would be able to facilitate this process somewhat if it at the very least refrains from any action that only serves to legitimize a doomed system.

HOW TO GET OUT OF THE TRAP

I have described a bleak picture. Ironically, Russia presents a more optimistic landscape when viewed from outside. The domestic audience, including the official establishment, on the contrary starts to view Russia's future as a catastrophe. What does Russia need to do to break out of its vicious circle and take on a European identity? Is there still a chance to do this? Or has Russia reached the point of no return in its stagnation slide?

In order to survive, Russia must reform its state matrix. This presumes a solution to the triad problem: a transition to the principle of competition in economics and politics, a rejection of the principle of merging power and property, and strengthening the rule of law. In practice, these three issues mean a transition to political struggle, and the inevitable end of the ruling regime and its focus on continuity and control of property. Solving the triad problem is impossible without a review of the PutinMedvedev foreign policy doctrine, which justifies simultaneous cooperation and containment of the West. To undergo such a radical transformation, the Russian elite must first realize that the current model of Russia's development is exhausted.

Today the Kremlin's modernization mantra proves that the ruling elite is not ready to start a real de-hermetization (liberalization). This leads to the unpleasant conclusion that a crisiswhether social, economic, or politicalis needed to persuade the elite that the system is threatening its survival. Regretfully, there are no examples in Russian history of preventive reform before a crisis hits. For the time being, the current ruling team has mistaken the lack of massive social unrest and anger as a license to continue moving in the same direction indefinitely. "We'll think of something tomorrow," the denizens of the Kremlin tell themselves, but the longer they take, the greater the danger of their losing control of the situation.

There is one more factor that may be just as important for Russia's transformation. No liberal transformation has ever taken place without the country in question coming into the orbit of the West. Since World War II, the key factor in transitions to democracy has been external pressure. This was what facilitated the democratic development of Germany and later of Southern European countries. Accession to the EU and NATO was the guarantee of irreversible transformation for the European post-Communist states. But openness to outside influence means readiness on the part of a country to limit its own sovereignty. Today Russia finds itself in a situation where Europe is not prepared to integrate it, and it is not prepared to give up even part of its sovereignty. On the contrary, retaining sovereignty has become the elite's most important tool for retaining power. Even Russian Westernizing liberals do not dare to mention that the country might have to give up a portion of its sovereignty to supranational European structures. For the man in the street, the very idea is blasphemous, a betrayal of the Homeland. Russian leaders see their primary mission as strengthening Russia's sovereignty and maintaining its independent path. How different they are from Chancellor Konrad Adenauer, who led Germany to democracy, when he dared to declare in 1953 that "Europe is more important than a nation!"

"Nothing to worry about," say some liberal observers in Russia, "we can make Russia a modern state while taking an independent path and subordinating ourselves to no one." Alas, there is no precedent for liberal transformation without the influence of the West and some type of integration with the West, and Russian development after 1991 gives no indication that that precedent is about to be broken. Meanwhile, the logic of history moves on. In its day, the Soviet Union based its existence on a global missionary project. That project was bound for nowhere, but at least it conferred an idea and passion to the system. Today's Russian system has two ideas: national egotism and personal enrichment. But people are beginning to ask: "Is our might a delusion? And who is going to make us rich, and how?" The Russian authorities do not have the answers.
The mood is already changing. About a third of Russians could now be considered to form the modernist part of societypeople who are psychologically prepared to live and work in a liberal system. The modernist part of Russian society and the passive strata that could join it would comprise about 68 percent of the population. Today about 53 percent of poll respondents believe that it is most important to "respect civil, political, religious, and other rights" and only 27 percent think that the most important action is "subordination of the minority to majority." About 50 percent think that Russia has to join the EU, and only 27 percent think that it should not. At the moment, these people are atomized and are just hoping to get by on their own. It is not clear who or what could awaken them, or what will happen when they do awaken. But an enormous part of the Russian public is ready to accept new ways of doing things. This fact may become the key to Russia's future.

However, the Russian elite do not show signs that they are able to comprehend that continuing on the present path is suicidal. In the past, Russia has always sought its truth at the bottom of the abyss. In order to keep from falling into the abyss yet again, society must pressure the elite to take stock of its situation. For now, the public seems to be content with playing the regime's games. Those members of the elite who understand their plight remain too enmeshed in the system to speak out. For the time being, no one is taking responsibility for Russia's future. People who are able and willing to do so appear, however, when there is a societal demand for them. The liberalization of the Gorbachev era arose spontaneously, bringing to the fore previously unknown figures who grasped the historical moment better than anyone else (although they were not ready to offer a constructive alternative).

For now, the attempt to modernize Russia without changing the rules of the game may be the last Russian illusion. It is, in any case, an illusion that few in Russia seem inclined to believe. Even the Kremlin spin doctors have not bothered trying to make it sound convincing. The country's leaders are obviously confused, and it is clear that they do not know where they are leading it. The elite is trying to guess at what is ahead, while safely squirreling away their families and finances in the Westjust in case. The political regime cannot halt the growing dissatisfaction in its ranks.

What are the steps that could guarantee that this time Russia is ready to dismantle the Russian matrix? Let me give the "Must Do" agenda. Russia will need to:

* Hold free elections of the National Convention that will endorse the new constitution that will eliminate the omnipotence of the leader and introduce the checks and balances mechanism;
* Endorse new elections laws and guarantee free registration of the parties;
* Hold free elections to the legislatures and local self-government bodies and form a new government responsible to the Parliament;
* Secure freedom of media and meetings; and,
* Disband the current courts and law enforcement bodies (using the Georgian example) and form new ones.

These will be the first steps that could help Russia to get rid of the old system and start with new rules of the game. This transformation cannot be successful without massive pressure from the society, and the transformation itself cannot be done by the current ruling elite. All attempts to change the system just by new elections and bringing "new blood" into the state structures without changing the hyper-presidential constitution will be doomed to become a new Potemkin village exercise.

The true Russian transformation will be the result of domestic developments, activity, and actors. But this transformation has no future without incentives from the outside. The West and its readiness to create a constructive external environment for the Russian transformation could become a serious, if not crucial, factor of change. In order to play this role, the collective West will have to be able to avoid the confusion in which it found itself many times before, i.e., being caught flat-footed by the rush of history. In 1991, Western leaders and experts did not foresee the collapse of the USSRa comment on the quality of their Sovietology. In 199596, the West failed to appreciate the character of the system founded by Yeltsin. In 19992008, many Western politicians were mesmerized by the "Russian miracle," failing to understand the substance of the Putin regime and the kind of economic stability he created. In time, the number of inveterate optimists was reduced. But there are still quite a few who hail the idea of Kremlin modernization from the top with enthusiasm. These optimists are matched by others who reject the possibility of Russia's ever becoming a normal liberal country that maintains friendly relations with the West. Hopefully, today the West will be more prepared for a new stage of development.

One should not be lulled by the fact that things in Russia are quiet for now. This is a deceptive quiet. Even if a significant part of the public and a not-so-insignificant part of the elite believe they are living in a temporary shelter that needs to be rebuilt, that in itself is a condemnation of the system and of the Russian state. The Russian elite can keep engaging with Western counterparts, and Russian society may look as if it continues to sleep (or pretends to sleep), but deep down society is stirring. The new Russian "moment of truth" is inevitable. Regretfully, it will have to come after Russia and the West overcome the new illusion that Russia can modernize itself without changing its old genetic code.

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