Russia's Dangerous Hangover

John Barham, International Editor

Russia’s economy boomed during President Vladimir Putin's eight-years in the Kremlin. But analysts say his successor will have to cope with the hangover. A souring economy will force Dmitry Medvedev, to make some unwelcome political, military, and foreign policy shifts when he takes over as president in May. That was the consensus reached at a Washington, DC, conference on the aftermath of the elections.

Putin’s presidency was largely dedicated to rehabilitating Russia’s international standing after the humiliations of the post-Soviet period under Boris Yeltsin, said Pavel K. Baev, research professor at the International Peace Research Institute. That process of recovery “is over” he said. Soaring oil prices have masked serious economic problems, which Medvedev will have to fix.

Yet Russia’s hunger for recognition as a great power by western governments has never been greater. Bridging the gap between this aspiration and economic weakness will likely torment Medvedev for much of his presidency, Baev and other speakers argued at the conference, hosted by the Jamestown Foundation.

Russia’s manufacturing industry is inefficient. Its oil and gas industries are reaching breaking point after years of underinvestment. Russia benefited from the 320 percent oil price increase since 2003, but it can no longer increase output of  “its key commodity” said Stephen Blank, research professor of national security affairs at the U.S. Army War College.

Russia has not reevaluated what “greatness” means in world politics, Baev said. Oil revenues financed a huge military establishment in the Soviet era, which formed the basis of its great power status. “But military power is not sufficient any more for greatness in the modern world,” he said. “Russia can’t go on like this because the old system is so inefficient.”

However, pundits have misread Russia many times. Experts underestimated Putin, and they may have got Medvedev wrong too. His statements favoring the rule of law, economic liberalization, and an assault on corruption may bear fruit. If so, Russia’s relationship with the West may improve, marking a positive break from truculence under Putin.

Medvedev has indicated that unlike Putin, he will be more interested in developing better relations with Europe and less interested in confrontation with the U.S. But several speakers noted that Medvedev’s background as a lawyer, as opposed to Putin’s past as a KGB officer, is troubling. “Medvedev has no experience with military affairs. The risk is that he will not understand the limits of military power. He could be pressed to show decisiveness, perhaps over Georgia,” warned Baer.

Blank says foreign policy during Medvedev’s presidency will probably continue some of Putin’s principal initiatives, such as bringing regional oil and gas resources firmly under Russian control, strengthening relations with China, and investing more in the military – including its nuclear arsenal. He warned that cyberattacks, such as one launched last year against Estonia, may become more frequent. (Although suspected of the cyberattack, there is no evidence of Russian involvement.) Russia may also become more assertive in the Balkans, supporting Serbia against the European Union and the U.S.

Meanwhile, Medvedev faces daunting domestic political challenges. Lingering skepticism may affect his legitimacy to govern and demand sacrifices. “The outcome of these elections has been to delegitimize the election process – everyone knows that Medvedev’s mandate is flawed and he is vulnerable for that reason,” said Baev. “Medvedev is as vulnerable as Gorbachev was."

His base in the Kremlin is fragile. News reports indicate that Putin will likely retain control over senior appointments as one of his main levers of power. That could further undermine Medvedev’s authority. Jonas Bernstein, senior research associate at the Jamestown Foundation, said that Medvedev will probably be unable to establish his control over parliament, the ruling party, and the bureaucracy during his four years as president. Many expect Putin to use his role as prime minister to shore up Medvedev and prepare his return to the presidency in 2012.

But Putin’s legacy could also be at risk if the economy slows severely. “The basis of legitimacy is to deliver prosperity. In a crisis of inflation or slower growth, Medvedev will have the choice of reforming [the economy], which is always difficult, or inventing a crisis. This is easier, but it is also riskier,” said Baev. Foreign policy adventures in the Balkans over Kosovo or in the Caucasus, may be a way of managing domestic opinion. Blank foresees a period of growing authoritarianism, which he describes as “neo-Czarism” – a police state governed by an autocrat who pays lip service to constitutional proprieties.


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