Reverse Is the One Way Out of This Cul-de-Sac
by Anders Aslund, Peterson Institute for International Economics
Op-ed in the Moscow Times
February 14, 2007
© Moscow Times
A pivotal 12 months lies ahead for Russian politics. According to the Constitution, President Vladimir Putin has to leave office at the end of his second term, in March 2008, and he has maneuvered himself into a lose-lose situation. He needs to stay on for a third term, because his popularity is the key source of legitimacy in current Russian politics. Yet if he prolongs his rule in violation of the Constitution, he will lose his legitimacy.
During his presidency, Putin has systematically diluted the country’s nascent democratic institutions. The members of the Federation Council are now appointed, as are regional governors. Formally, the State Duma is still elected, but the parties, nominations, media coverage, and the elections themselves are now so manipulated that nobody can take them seriously.
As a consequence, few elements of political legitimacy remain in Russia. Putin’s election in March 2004 was the last free election, although the Organization for Security Cooperation in Europe rightly labeled it not fair. Today, no Russian election can be sufficiently free and fair to lend any credence to the “winner.” Putin regime’s profound dilemma is that it has deprived itself of all means to generate political legitimacy.
Russia’s economic achievements are impressive, but a growing standard of living is not enough to guarantee long-term political survival. Economically, Putin has linked his fortunes evermore to high world energy prices, which will not last forever.
Although the Kremlin has worked hard to stir up Russian nationalism, Russians at large do not seem ripe for such an extreme choice. The Russian Orthodox Church does not enjoy widespread respect. The formation of an alternative, pro-Putin party, A Just Russia, makes United Russia look all the more artificial. The reproduction of more pseudo-parties would only make Putin’s Russia more reminiscent of the former East Germany, with its three official pseudo-parties.
The conventional wisdom is that Putin wants to leave his presidency in constitutional order. One of his two semi-official heirs apparent, First Deputy Prime Minister Dmitry Medvedev or Defense Minister Sergei Ivanov, is supposed to be appointed as his successor, after which the grateful Russian people are supposed to vote for Putin’s choice. Any one of a number of dark horses could still be brought in, but the modus operandi will be the same.
If this sounds like some kind of dream world, that’s because it is. Boris Yeltsin could appoint Putin and get away with it because no one thought his team could pull it off. The very essence of Russian politics is surprise, so what is anticipated becomes difficult, and sometimes impossible to pull off.
Another reason why a smooth succession is unlikely is that, in the best Machiavellian tradition, Putin has encouraged a maximum of strife between his subordinates to ensure that they cannot collude against him. According to most accounts, the relationships between his underlings are on the verge of open warfare. Whomever Putin chooses as his successor will be seen as a dangerous enemy by his or her colleagues, who will insist that Putin stay.
Putin’s top people currently control huge amounts of wealth through state companies. Because they do not officially own these companies, they have to operate through informal contracts, often worth billions of dollars. But they cannot defend these informal contracts in court. People kill for less, and Russia has already seen a regression to the high-level commercial murders of the mid-1990s. Regardless of who takes over, many of Putin’s top officials will likely fear the loss of their fortunes and will do whatever they can—meaning a lot—to ensure that a real transition does not take place.
The final reason no orderly transition is likely stems from Putin himself. He is notorious for making decisions as late as possible. Inevitably, he will make this final big decision very late, if at all, because he is afraid of becoming a lame duck. In all probability, he will miss the most favorable time to make his exit. His recent statement that he will announce his preference at the beginning of the election campaign presumably means less than three months before the scheduled election date.
Putin’s success at maintaining high popularity ratings is admirable, but that is the only strength that remains of this regime, and it may pass faster than anybody currently imagines. Few people remember today that Ukrainian President Leonid Kuchma was quite popular and won a run-off in reasonably free presidential elections in the fall of 1999. One year later, however, when it appeared plausible that he had ordered the murder of a critical journalist, his popularity plummeted to single digits, never to recover. And all this despite the fact that he controlled Ukrainian media almost as closely as Putin manages Russia’s.
Is there a chance, alternatively, that the government could change the situation with the application of effective policy? After the disaster with the social benefit reforms, Russia has maintained a near moratorium on changes to the system of this magnitude. At present, the main government policy initiative is to evict all foreign nationals from outdoor markets by April 1, which will reduce supply and boost the prices of produce for the country’s poorest people, who are the markets’ chief customers. This is hardly an election-winning strategy.
Another possible election strategy is a war on corruption. Corruption is a dominant popular grievance, but eminent Bulgarian political scientist Ivan Krastev has pointed out that all postcommunist governments that lose elections do so because of corruption. The more attention a government pays to corruption, the more people realize how bad the problem is, with the incumbent administration being viewed as the culprit.
Corruption in Russia has risen in the last few years, while it has been abating in most other postcommunist countries, according to Transparency International, European Bank for Reconstruction and Development, World Bank, and Indem think tank. Eventually, this observation will come home to roost with the would-be electorate.
Furthermore, Putin has built a structure that does not allow him to retire. Yeltsin could do so because he had established a certain rule of law, which guaranteed the validity of the law on his immunity. Putin has undermined the rule of law to such an extent that he cannot repeat Yeltsin’s elegant exit, because no successor can guarantee that he will not be prosecuted.
Putin is no fool. He understands that he is currently at the peak of his power, so things can only get worse. He no doubt realizes that it would be best for him to resign after two terms, but he has painted himself into a corner. His only apparent option is to stay on as president. Even if Putin were to become chairman of the Constitutional Court and tried to impose his professed “dictatorship of the law,” he could not control the country because of insurmountable strife among his former underlings. The fundamental problem is that Russia no longer possesses institutions that can grant legitimacy to any successor.
So is this a dead end? Can Putin avoid crashing? The answer is “yes.” As in any cul-de-sac, the solution lies in hitting reverse, which in this case leads back to the road of democratic principles. Admittedly, societies based on civil rights and freedom often present rulers with some rude surprises, but they do function and generate legitimate leaders. Hitting reverse makes more sense than crashing.