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Pavel Baev's Blog

Dear friends and esteemed opponents

This is not quite a personal diary – but rather a professional track-record of my small publications, interviews, presentations at seminars, and other current affairs.

Друзья, коллеги и прочие праздношатающиеся

Ничего личного на этих страницах – кроме небольших статеечек, мелких интервьюшечек, и прочих оказий, где я упустил возможность промолчать. В основном, увы, на аглицком, спрашивайте – буду оправдываться.

The preview of the rally in Moscow

Posted 30 Jan 2012 by Pavel Baev printer icon permanent link

​I am packing for a trip to Moscow (first to London for a seminar at the FCO),the main point of which is to partake in the rally on February 4. The article in the EDM provides a background for the event.

The anti-Putin momentum from Davos to Courchevel to the Bolotnaya square

 There has been much more talk about Greece than about Russia at the World Economic Forum last week, which shows that the Davos crowd typically tries to discern the future challenges by looking backwards, because the Greek financial fiasco should have been debated two years ago, while it is the Russian repercussions that are looming large for the near future. A planeload of ministers and directors of state-owned companies has duly arrived to Switzerland, and their collective message is that only Vladimir Putin’s confident win at the presidential elections in just one month could secure gradual implementation of necessary political and economic reforms (Kommersant, 28 January; Newsru.com, RBC Daily, 27 January). A dissenting voice was Aleksei Kudrin, former finance minister turned free agent, who calmly pointed out that the outrageous defense expenditures and unsustainable social programs were not a budget problem but a product on ineffective and outdated political system (Vedomosti, 27 January, New Times, 23 January).

 

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Another sign of deepening troubles in Russia is the very quiet January at the French ski resort Courchevel, which used to be a true vanity fair where Moscow high society celebrated their good fortune (Gazeta.ru, 24 January). It was flamboyant billionaire Mikhail Prokhorov who introduced this seasonal extravaganza but now he is busy on the campaign trail presenting himself as a credible alternative to Putin (Vedomosti, 27 November). His ideas about sharply reducing state control over economic life and curbing bureaucratic predation would have won approval in Davos, but in the eyes of too many Russians he remains a symbol of shameless self-enrichment by grabbing privatized assets on the cheap and selling them way above the value. Prokhorov has also made a strong pledge to set free Mikhail Khodorkovsky and other political prisoners, and this direct hit on Putin’s personal vendetta resonates so strongly among the electorate that President Dmitri Medvedev finds it necessary to explain his reluctance to grant him a pardon (Gazeta.ru, 25 January).
Khodorkovsky has argued for many years that the crucial issue is the discontent with the yawning social inequality that turns into anger when nouveaux riches flaunt their luxurious yachts and frolic in Alpine resorts, and this year Davos has awakened to this problem (Rossiiskaya gazeta, 27 January). The developing political crisis in Russia is driven by the resentment against social injustice but it involves only the urban middle classes demanding political representation, while the masses of have-nots remain passive. Putin seeks to exploit this disconnect by portraying the opposition as a Moscow ‘thing’ and playing on the pronounced resentment in many regional and provincial cities against the arrogant capital that concentrates too much power and money. That might bring him some extra votes and support the wobbling support rating but his conflict with Moscow is set to escalate (Novaya gazeta, 28 January).
The focal point of this conflict is the rally organized by the opposition on February 4, and the Kremlin used every administrative pretext and procrastination to derail this event aiming at provoking quarrels between micro-parties led by ambitious rebels. By the end of last week, however, it had become clear that unless an official approval is granted, thousands of Moscowites would partake in an unsanctioned rally, which the authorities would have to suppress. Medvedev didn’t want such a violent confrontation to mar his presidency, disappointing as it is, so he called the Moscow mayor Sergei Sobyanin, whom he had appointed just over a year ago, and the affirmative answer was communicated to the puzzled group of activists (Ezhednevny zhurnal, 27 January; Moscow echo, 26 January). The march would go to the same Bolotnaya square where the first mass protest shattered the habitual apathy on 10 December, and the opposition has to demonstrate that the drive has not dissipated and new tens of thousands from the ‘creative class’ are committing to the ‘Russia without Putin’ cause.
What makes this commitment problematic is that the angry Moscowites have nobody to vote for at the forthcoming elections; Grigory Yavlinsky was perhaps not a very promising option, but still he was eliminated from the list of candidates on technicalities (Kommersant, 24 January). Putin tries to regain confidence from the weakness of leadership in the opposition camp, which indeed cannot have a leader because the agendas of veteran dissidents and successful entrepreneurs, popular authors and bloggers go in all sorts of directions (Vedomosti, 27 January). Mikhail Gorbachev argues that this diversity reflects changes in the society that has become too complex for over-centralization and suggests a referendum on a constitutional reform that would reduce the concentration of power in the hands of president (Novaya gazeta, 27 January). This strategy of peaceful dismantlement of the dysfunctional regime requires an acceptance of non-sustainability of the existing order by the ruling and self-serving bureaucracy, which might appear impossible but could turn out to be attainable. This bureaucracy constitutes a large part of the urban middle class and is therefore exposed to all the emotional frustration with, and intellectual opprobrium of the dreary Putinism (Nezavisimaya gazeta, 26 January).
It is a very delicate balance between sustaining pressure on the disheartened regime by gathering larger and larger rallies and avoiding radicalism that could scare the power-holders and trigger violent clashes that would push Putin into a corner. The leaderless but tightly networked opposition is remarkably successful in preserving this balance seeking to discharge the building anger and convert it into a more cheerful and positive offensive resembling more the Kreshchatik in Kiev in late 2004 than the Tahrir in Cairo in early 2011. Putin, on his side, has made a few mistakes of judgment on the merits of his own leadership and quite a few errors in verbalizing his feelings about the unruly Moscowites – but refrained from acting on his belief in an ‘iron hand’. The real test is shaping up after the election, in which Putin is set to produce for himself a mandate for action – but the rallies would become more determined. The only way to pass this test without a tragic breakdown is to make sure that Bolotnaya becomes too bit to fail.

Can Putin count on the stupid economy?

Posted 23 Jan 2012 by Pavel Baev printer icon permanent link

​This should appear later today in the EDM in a beautifully polished form:

The political economy of Russian revolution in the making

 Russian economy generates no drivers for a political crisis – this elementary proposition underpins Prime Minister Vladimir Putin’s steady march to the presidential elections that are just six weeks away. He returns to the good economic news in every speech and article arguing that Russia with its 4% GDP growth in 2011 was behind only China and India, while economists point out that Indonesia and Saudi Arabia, Kazakhstan and Ukraine also performed better (Nezavisimaya gazeta, Vedomosti, 18 January). Putin also asserts that Russia is the world leader in terms of the budget surplus, which is also a departure from reality and a result of the record high inflow of petro-revenues (Newsru.com, 20 January). In fact, given the very favorable conditions in the global markets of energy and metals, Russian economy seriously underperformed in 2011, but Putin is not interested in discussing the effects of the ‘resource curse’ and has refused to partake in the debates of presidential candidates.

 

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He speaks not to the urban middle classes well-informed about real economic challenges but to the pensioners, state employees and workers at the Soviet-era plants who constitute his core electorate and want to hear reassurances in undiminished budget generosity (Forbes.ru, 17 January).  Pre-election promises are a dime a dozen but Putin’s need in sustaining the support from ‘masses’ has serious implications for strategic choices in economic policy. These choices were scrutinized last week at the Gaidar conference where leading economists and some Putin’s minister’s argued about the urgency of reforms that should mitigate the impact of the deepening global recession (Nezavisimaya gazeta, 19 January; Kommersant, 20 January). The problem with these reforms is that they answer first of all the interests of private entrepreneurs, who are increasingly in opposition to Putin’s regime and cannot be dissuaded from their preference for an open society (Moskovskie novosti, 20 January).
Putin’s conservative and paternalistic electorate is suspicious of market competition and expects a further strengthening of the state’s direct control over the economy, which also sits better with his own vision of hierarchic governance. This course towards centrally-planned neo-industrialization has a strong militarist vector because armaments production is a major specialty of the Russian economy and employs millions of people particularly in small and medium-size cities. This defense-industrial sector has an insatiable appetite for money from the federal budget but its products and prices leave it prime customer – the Defense Ministry – increasingly dissatisfied. It is the technical failures in missiles that attract the most attention as satellites crush down from odd orbits but more damage is done by such trivial accidents as the fire in dry dock that has incapacitated Russia’s best strategic submarine Yekaterinburg for at least two years (Kommersant, 19 January). Seeking to improve the management of the defense acquisitions Putin appointed ambitious Dmitri Rogozin as deputy prime minister but his flamboyant style would hardly help much in converting the giant rusty plants into high-tech enterprises (Nezavisimaya gazeta, 20 January).
Former finance minister Aleksei Kudrin has become the leading critic of the wasteful and unsustainable channeling of budget resources into the rearmament program but Putin resolutely rejects his prudent suggestions knowing that they have to be taken into account and that many in the government do (RBC Daily, 20 January). Even more striking is Putin’s readiness to put pressure on the oil and gas sector that used to enjoy his privileged attention but now is treated as a reluctant source of revenues. Domestic prices on gas and electricity have been frozen until summer, the money flows inside the oil companies are now taxed more severely, but the external interests of Gazprom and Rosneft are largely neglected (Moskovskie novosti, 19 January). Gazprom has to grant European partners new concessions on prices and its crucially important negotiations with Ukraine on acquiring a controlling interest in the gas infrastructure are not going anywhere (Nezavisimaya gazeta, 18 January). Putin has recognized that his too close involvement with the gas business has become a political liability, while the very probable retreat of the oil prices constitutes the gravest risk to his policy of economic dirigisme.
Economic crises very often require such a policy, and sensible leaders are often compelled to postpone the necessary reforms until after elections, but Putin’s predicament is of a different kind. He expected a smooth sailing which would have given him a freedom of political choices but now he has to fight for the coveted presidency and the mobilization of his support base requires a commitment to the course of firm central control over economic life (Gazeta.ru, 20 January). He has hardly any illusion about the efficiency of this control that has long degenerated into a system of bureaucratic predation, so that up to 30% of all economic activity takes place in the ‘shadow zone’ of non-governmental taxation (Vedomosti, 20 January). Contraction of petro-revenues determines the need in raising taxes in order to sustain the high volume of state expenditures, and that is certain to push more business underground. Entrepreneurs are hedging against the expansion of business-unfriendly policies by evacuating the profits to the European ‘safe havens’, but now they have to take into account such a new factor as the escalating political risk (Gazeta.ru, 18 January).
The direct economic impact of the two massive December rallies in Moscow remains statistically insignificant and no strikes are called for, but too many members of the business elite have gained first-hand experience in street politics to doubt the seriousness of this risk. The tactics of deception through dialogue aside, Putin’s ability to execute the minimal reform package acceptable for the ‘angry minority’ is strictly limited by his commitment to the conservative program. The combination of ‘proletarian’ populism and bureaucratic statism logically requires a third element – repression, and the attempt to ban the opposition march scheduled for February 4 might signify a turn in this direction. The problem is that the paternalism has become so false and the bureaucracy so corrupt that the repression could hardly be effective. The plain fact is that Putinism has stopped making economic sense, so its implosion is in no doubt – but the outcome of this messy process is very much in it.

Russia stands firm on Syria

Posted 20 Jan 2012 by Pavel Baev printer icon permanent link

​Russia Profile called me for a comment on the Russian position on Syria and the result is here (http://russiaprofile.org/international/53017.html).
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​This fits very nicely with the discussion on Syria we have had in the newly-formed C & P RG.

Putin tries to regain the initiative

Posted 17 Jan 2012 by Pavel Baev printer icon permanent link

​This is published in the EDM with proper editing:

Putin tries to regain the initiative but remains out of touch

There were no New Year holidays for Prime Minister Vladimir Putin and his sycophants because the need to take back the political initiative from the opposition was urgent. The next mass rally in Moscow is scheduled for February 4, so they had only three weeks for re-establishing the dominance on the electoral arena and mobilizing the support base. The Kremlin counter-offensive has indeed been launched along many axes: From the opening of the ‘candidate-Putin’ website (http://www.putin2012.ru/) to the dressing down of insufficiently loyal governors to a lengthy meeting with a select few representatives of the legion of amateur fisherman (Moskovsky komsomolets, 12 January). The only kind of activity that Putin is reluctant to engage in is public appearances since every whistle is certain to be amplified in the blogosphere, so the only audience where he felt safe was the State Prosecution staff meeting (Rossiiskaya gazeta, 13 January). Everything appears to go smoothly but every well-calculated image-booster adds to the pool of disenchantment with and irritation against the all too familiar Mr. Putin.

 

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What has accentuated this feeling of déjà-vu is the program for the new presidential term, which Putin has allegedly penned himself and published on his new website inviting a comments and suggestions. The discussion has instantly acquired a very undesirable character with an avalanche of suggestions to take a long break (Moskovskie novosti, 13 January). The program is indeed so wanting in fresh ideas and plentiful in hollow promises that many commentators conclude that Putin has given up on winning support in the ‘thinking classes’ and targets the electorate that prefers paternalistic stability (Vedomosti, 13 January; Novaya gazeta, 12 January). This is a deep stratum in the Russian society but many among the have-nots are offended by the shameless corruption in the ruling bureaucracy and vast income inequality. Putin may think that he knows how to connect with the ‘working class’ but his populism has become too distant and arrogant to be convincing.
The main strength of his electoral platform is supposed to be Russia’s economic growth, and Putin presents it as his personal achievement omitting to mention the impact of high oil prices. The macro-economic figures are, however, rather meaningless for his core electorate, which knows first-hand that its real income is falling and suspects that petro-revenues are simply stolen (Newsru.com, 13 January). Inflation has fallen due to the massive outflow of capital, but investment activity is depressed for the same reason, and Putin’s emphasis on a ‘new industrialization’ is irrelevant for the economy so profoundly dependent upon the export of hydrocarbons (RBC Daily, Moskovskie novosti, 13 January). His trademark ‘manual management’ guarantees that bureaucratic predation would dominate over the business interests in making the market a safer place, which is a recipe for stagnation even in the best possible ‘barrel-goes-sky-high’ scenario (Gazeta.ru, 12 January).
The economic crisis has certainly hit the West harder, but Russia cannot exploit its position of relative strength because the Kremlin’s desperate preoccupation with the budding domestic revolution has brought its foreign policy to a nearly complete halt. President Dmitri Medvedev’s visit to Brussels last December for the EU-Russia summit was free of any content and his non-meeting with NATO Secretary General Anders Fogh Rasmussen was a non-issue (Kommersant, 19 December). The port-visit of aircraft carrier Kuznetsov to Syria was not cancelled because the Commander-in-Chief – and Medvedev still formally performs this function – was unable to make a decision or to take this major blunder with Putin (RIA-Novosti, 10 January). The serious escalation of tensions around Iran attracts very little attention in Moscow, which disapproves the expansion of the Iranian nuclear program but is content to follow the lead from China (Gazeta.ru, 12 January).
One foreign policy resource that has stopped paying any domestic dividends is anti-Americanism, and every attempt to portray the protests as ‘subversive activity’ financed from abroad backfires in demands to present evidence and in better fund-raising for the next rally (Moscow echo, 14 January). One particular issue that has long been a thorn for Russia’s foreign policy and now has become a focal point in the domestic political crisis is the persecution of Mikhail Khodorkovsky and his associates (Nezavisimaya gazeta, 30 December). Even such ‘anti-oligarchic’ presidential candidates as die-hard Communist Gennady Zyuganov find it opportune to promise their immediate release (Grani.ru, 12 January). Khodorkovsky is cautiously optimistic about the revival of politics in Russia but argues that Putin’s regime has exhausted its reserves to such a degree than any crisis could turn out to be the last one (Newsru.com, 12 January). Putin knows that the ambitious oligarch he sought to crush in order to discipline the others has grown into a potent symbol of resistance to his authority, so setting him free is out of the question. The tactics of splitting the opposition by engaging it in negotiations on minor concessions fails this test because the first question that is placed on the hypothetic round table is the freedom for political prisoners.
Putin finds himself trapped in a bad dilemma where the use of old political tricks for consolidating the traditional sources of strength makes him an old-timer who is stuck in the past and every attempt to initiate reforms  invites parallels with Medvedev’s bogus ‘modernization’. He knows the value of information but has long placed himself in a cocoon where lackeys feed him only with the news they presume he wants to hear. The crowd of courtiers still simulates the habitual milieu where his every caprice becomes an executive order and every joke shines as a word of wisdom. Putin may despise this servility but he firmly believes that he is loved and respected by the vast majority of Russians so there could not possibly be any alternative to his leadership. He refuses to learn the simplest of introductions to the Internet where bloggers ridicule his pompous style and cannot allow a suspicion that his ‘loyal subjects’ turn away from TV screens because the propaganda lies have become too tired. His greatest departure from reality is in the self-deception that in just six weeks all the anxiety will be over and his presidency is safe for the next six years.  

McFaul comes to Moscow

Posted 16 Jan 2012 by Pavel Baev printer icon permanent link

​Moscow Times called me for a comment on Michael McFaul's arrival to Moscow as the new US Ambassador and the result is here (http://www.jamestown.org/programs/edm/).
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​They asked me a lot of questions about Mike - but the only point that has meda it to the text is a story that actually belongs to Kolya Petrov.