THE BIG COMEBACK: THE THIRD PRESIDENCY OF VLADIMIR PUTIN

It would be a mistake to believe that in May 2012, after two terms as president, Vladimir Putin was able to pick up where he left off four years ago – formally bowing to a constitutional provision. Both Putin and Russia itself have changed a great deal since 1 January 2000, when Boris Yeltsin, who had just delivered a brief but poignant resignation speech, was seen through the gate of the Kremlin by a pale-faced politician barely known to the world at large. And both Putin and Russia have changed since 2004, when the former reasserted his position at the helm of the nuclear superpower so nonchalantly it appeared he took it for granted.

His rise to the presidency 12 years ago had shades of a coup d’état, a manoeuvre that would be formally confirmed by elections a few months later when he had consolidated his power. For the majority of citizens at the time, however, the arrival of Putin was met with a sigh of relief. This is hardly surprising considering that, by then, millions of Russians had grown thoroughly tired of the scandals and drunken antics of Boris Yeltsin and his court, both at home and abroad. Then eight years ago, Putin sailed through the next elections to prolong his reign for another term.

The situation is completely different today. It is probably for good reason that his recent inauguration, emulating the American model but wallowing in Byzantine grandeur, reminded some commentators of the coronation of Nicolas II, the last Tsar of the Romanov dynasty. On 26 May 1886, Nicolas II was put in charge of an empire torn by ethnic, political and social conflict; an empire that had irreversibly parted with the European path of modernization – only he was unable and unwilling to comprehend it.

In May 2012, Vladimir Putin reached the top, but when it comes to treating social discontent, he seems unwilling to look beyond the mere symptoms. The question is how much significance he attributes to the fact that Dmitry Medvedev, who kept Putin’s presidential seat warm for four long years, stirred great but entirely unfounded expectations in the country. In the same way, Nicola II, when receiving the city elders of Tver who had come to plead for local self-determination, accused them, in words that became oft-quoted, of “building castles in the air”.

“Freedom is better than the lack of freedom”, Medvedev said four years ago, on the eve of his election, vouching for “a prosperous, democratic Russia, the homeland of the most talented, most discriminating people who think critically”. But as time went by, it took the first signs of social discontent for Medvedev to even begin implementing any of the changes he had promised, including simplifying the rules for funding political parties and the process of electing, rather than centrally appointing governors, the solution introduced during the Putin era.

Having vowed to accelerate modernization and encourage innovation, the president pledged himself four years ago to the democratic institutions as well as the rule of law for Russian entrepreneurs, every sixth one of which was by then constantly threatened with criminal prosecution. Medvedev did have some minor achievements. For instance, it was under his watch that government officials began to disclose their financial statements, and that the police reduced the number of active staff, raised officer salaries, and stepped up the monitoring of police activities. Medvedev’s efficiency as president was severely compromised though by his very obvious subordination to Putin, who had managed to retain nearly all of his power in the prime ministerial seat, and by the common knowledge that Medvedev’s mandate would soon come to an end. In Russian-Soviet political culture, the imminent termination of one’s role is tantamount to already being removed.

Medvedev’s legacy consists not so much of ramming through various provisions, one third or half of which the apparatus actually implemented and enforced, as of his penchant for civil liberties and fair elections, a stance which happened to coincide with trends in the majority of countries recently released from the shackles of state socialism. Naturally, the global information revolution in general, and the far-reaching influence of the Internet in particular, have also played a part in the process. In contrast, Putin reaffirmed his commitment to his own core values: the armed forces, and in particular the secret services, that have backed him up; the interests of groups that have amassed billions of roubles over the past 12 years; and expansion by means of energy resources instead of tanks – in short, a return to the imperial ideal capable of rallying the whole of society behind him. This threefold asset of Putin’s was amply demonstrated by the World War memorial ceremonies held in Moscow and dozens of cities around the country just 48 hours after his inauguration. The military show of force, staged in tribute to the Red Army that “saved the entire human race”, amounted to tacit homage to Stalin’s bloody regime.

Honouring the call, the Kremlin enlisted the help of the entire media to broadcast Putin’s comeback. Unlike with post-Soviet presidential inaugurations, the triumphant event was now shown on six rather than three television stations.

For the overwhelming majority of the population, the pomp and splendour must have gone a long way toward countering the impact of the demonstration dubbed “March of Millions”, held the day before the inauguration ceremony by citizens who travelled to Moscow from all over the vast country to protest rigged elections and the curtailment of civil liberties. In the event, the absence of a charismatic leader rendered the political leverage of the demonstration doubtful at best.

Still underdeveloped and falling into discrete or warring factions, civil society nevertheless represents a force that Vladimir Putin and his entourage must reckon with. This holds the least true for foreign policy, which in the typical Russian consciousness is upstaged by domestic problems, but which has already begun to display unmistakably hard line signs. A case in point was the conference held in Moscow a few days before Putin’s inauguration on the American anti-missile shield, in which Chief of Staff General Makarov lashed out at Washington over defence objects planned in Polish and Romanian territory, in a tone that harked back to the Brezhnev era. Never since the Second World War had what he bluntly called “hostile forces” edged so close to the Russian border. Concerned over the alleged ability of these installations to intercept and shoot down Russian missiles as soon as they have been launched, Makarov – as if to further enhance the impact of this nightmare vision – went as far as envisaging potential pre-emptive strikes against the shield and the host countries. It is rare indeed that such a threat has been uttered in such a manner, no matter how extraordinarily sensitive the issue may have been for Russia.

As for the impending shifts in Russian economic policy, it seems likely that the energy sector will continue to supply around 50 per cent of Russia’s budget revenues. Not everyone in Moscow is happy about this. Many have warned about the danger inherent in the excessively large share of raw materials in exports, a dominance which keeps the dream of modernization ever further out of reach. Even Putin’s closest allies were outraged by his centralization-minded proposal to assign the economy of the Far East and Siberia – two struggling regions despite their rich natural resources – to the supervision of a purpose-designed state monopoly not unlike the Russian Foreign Trade Bank. The project is the brainchild of Sergey Shoygu, a native Tuvan, who served for 18 years as Minister of Emergency Situations and was elected as third Governor of Moscow Oblast on 11 May. Following the initial leaks, the grandiose plan was embraced by Putin himself, who is now himself looking ahead to another six-year term in office.

Accounting for over one third of the territory of Russia but numbering a dwindling population of only eight million, these two vast regions are about to be given extraordinary powers, tax breaks and what is the single most dangerous benefit from the point of view of modernizing Russia: complete independence from the central government, with the exception of course of the president and his inner circle. Having been drafted by the ministry of economic development and made public in late April in Kommersant, the monopoly will reserve the power to oversee the activities of the new gigaholding group on behalf of the president and the Court of Auditors. The corporation will have an unprecedented – and as yet insufficiently specified – say in the operations of Gazprom, the pipeline giant Transneft, and other companies of strategic importance. The new holding group will also acquire a stake worth some 500 billion roubles in the state-owned railway company, the diamond industry leader Alrosa, and other major concerns.

The gigaholding group will be headquartered in Vladivostok and be put in charge of coordinating the economic development of six regions in Siberia and nine in the Russian Far East. Among other immunities from various laws, it will have the right to bypass tendering procedures in contracting business entities for mining and forestry operations. The group will also be exempted from all forms of income and property tax, enabled to acquire lands and construction licenses via a simplified process, and given discretion for ten years over the receipts of the National Welfare Fund.

This type of supercorporation, created by a suite of mergers, is not in itself new to the history of latter-day Russia, which began in January 2000 following the resignation of Boris Yeltsin. In fact, the genre is a recurring motif of Vladimir Putin’s reign. At the time he was about to hand over power to the loyal Medvedev after two terms in office, hundreds of military and motor companies were fused in a huge state-owned corporation headed by Semyon Chemezov as part of a string of mostly behind-the-scenes manoeuvres named Operation Successor. Control over the monster thus created under the name of Rostechnology, as well as over Gazprom, which had been outsourced to private ventures in the 1980s and 1990s only to be brought back to the fold of the government by Putin confidants, has provided Putin with indispensable safeguards meaning that, come what may, he would retain a firm grip on Russia’s economy. Besides Rostechnology, similar functions were vested in Vnesheconombank (VBE), the nanotechnology research company Rusnano, Olympstroy (a company created to build infrastructure for the 2014 Winter Olympic Games in Sochi), a mysterious holding group intended to oversee the renovation of residential apartments across the country, the nuclear energy group Rusatom, and a corporation to insure bank deposits.

Medvedev and his allies began to launch attacks on the gigaholdings, accusing them of sidestepping competition and of providing a breeding ground for a variety of ills inherited from the Soviet era, including corruption and a lack of professional expertise. Having accumulated considerable experience as a legal counsel during the privatization drive of the 1990s in St Petersburg, the departing president had personally uncovered a number of legal violations. This is hardly surprising, if only because the leaders of the omnipotent business empires routinely had the nerve to blatantly miss their deadlines for submitting mandatory financial reports to the Ministry of Finance or to simply “refuse” criticisms by the Court of Auditors. If the superholding now being contemplated turns into a reality, for all intents and purposes, it will have delivered the fabulous wealth of Siberia and the Russian Far East into the hands of a narrow elite group.

Where is Russia headed with the demonstrations now under way in Moscow and other cities? Do these demonstrations have any prospect of triggering radical political change? And what is it in our shared Euro-Atlantic world that can produce such a change? Well, beyond the organized expression of social discontent, which these demonstrations certainly express, radical change will take some kind of intervention by a considerable external force. This is how the Russians used their tanks, for instance to crush the Hungarian Revolution in 1956, or to riddle striking workers with bullets in Novocherkassk in 1962. Today, Russia’s preferred weapon is that of turning off the gas tap, to Ukraine, Belarus, and even Slovakia and Bulgaria.

There is no such external force that could be brought to bear on the processes in Russia today, despite the relative success, around the turn of the millennium, of various post-Soviet revolutions, coalesced under monosyllabic catchwords invented by American public relation gurus and organized using funds from non- profit organizations, from the Balkans to the twitter revolution of the strategically vital Moldova.

For the time being, the source of the money the crowds of demonstrators use to buy their train tickets to Moscow, camp out and get fed remains an enigma. It is just a matter of time before we find out. In any case, non-profit organizations which support the expression of political interests were virtually banned in Russia by the enactment of a law after Putin’s rise to power. What Western aid does get in lands in the hands of self-proclaimed liberal politicians without any social backing whatsoever, such as Garry Kasparov or Grigory Yavlinsky.

Another source of outside pressure could be the European Union, the potency of which has been learned in Hungary the hard way. Contrary to expectations, however, Brussels essentially failed to break the resistance of the Kremlin by means of the Third Energy Package, which came into force in May 2011. When Putin caused consternation by cancelling his attendance at the G8 meeting directly after his inauguration, he also sent a message to his domestic detractors. One can count on such antagonistic gestures to become more commonplace in the near future, not least as an effort to counter the Russian demonstrations.

What worked so well in Europe in 2011 and 2012 – i.e. the resignation of governments under the pressure of demonstrations partially generated by outside forces, followed by the formation of a new government with or without general elections – would be unimaginable in Russia. On the one hand, Putin and his circle retain control over all the armed forces of a nuclear superpower. On the other hand, such a scenario is simply unheard of in the history of Russia, where revolutions over the past two centuries have always been started from above. These included the wondrous tsarist reforms of the 1860s, which brought in mandatory schooling, the autonomy of universities, and other tools of modernization, and undermined the empire so thoroughly that Russia today is still struggling to achieve the level of legal certainty it enjoyed 150 years ago. They also included the much less wonderful Bolshevik takeover and, later, Boris Yeltsin’s “revolution” whereby he vanquished Gorbachev. Revolutions steered from above in Russia invariably have one thing in common: sooner or later they come to a dead end and are declared a failure. Of course, Russian history knows another scenario as well, that of uprising, insurrection, and rebellion. But the tradition of Stepka Razin, Pugachov, the bloody Jewish pogroms on the eve of the First World War, and the massacre of landowners will surely not be continued in the 21st century.

These considerations lend support to the conclusion that the demonstrations in the cities of Russia are not going to have genuine consequences for the world at large, and that they will be unable to trigger meaningful change, if only because there is no one to take charge of implementing such change. Yes, it is true that the Internet, along with other technical marvels of the globalized world, has largely abolished the isolation of remote Russian settlements, but this is far from sufficient for a political about-turn. Under a leadership reared on the milk of the KGB and socialized on violence, change in any measure can only come from the strife of warring factions and the tactics of loosening and tightening the reins upon society.

Translation by Péter Balikó Lengyel

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