Quantcast

Putin's Choice | The Nation

  •  

Putin's Choice

  • Share
  • Decrease text size Increase text size

Moscow

Vladimir Putin has been Russia's President for seven months, but there is no agreement in Moscow as to who he is or what kind of leader he will be. Indeed, after three weeks here it's clear that various Russians hope for at least four different, conflicting, Putins: a savior of Russia as a great state, a neoliberal strongman, an oligarchical Praetorian and a populist who will save the people from the worst economic depression of modern history.

About the Author

Katrina vanden Heuvel
Katrina vanden Heuvel
Katrina vanden Heuvel is Editor and Publisher of The Nation. She is a frequent commentator on American and...

Also by the Author

Kiev’s siege of the Donbass, supported by the Obama administration, is escalating an already perilous crisis. 

Progressives need a counterweight to the ALEC, one built and operated with progressive values in mind. And soon, we might have one.

The "statists"--a broad coalition of security and administrative officials and nationalist intellectuals--hope Putin will restore Russia as a great power or become, as a young KGB general told me, "Vladimir the Savior." The statists see themselves as the only true patriots who can save Russia from the collapse, corruption and weakness they see as Yeltsin's legacy. (Although Putin was created by Yeltsin's Kremlin, this group and many others here see him as the anti-Yeltsin.) They want him to be a modern-day Peter the Great, taking from the West whatever Russia needs--a market economy, technology, foreign investment--and sweeping aside all opposition and obstacles to the nation's rebirth.

In his first State of the Nation address, to a joint session of Parliament on July 8, Putin gave the statists reason to believe he is the leader they want. And there are other signs. Former KGB officials are filling positions of power in the Kremlin and the regions, declaring, as a TV commentator anxiously observed, "All power to the President." Putin has launched a legislative assault on the power and autonomy of Russia's eighty-nine territorial bosses, created a new instrument of executive power in a beefed-up Security Council and indicated a readiness to reassert state control over the country's rich natural-resources monopolies privatized under Yeltsin. There is an ongoing Kremlin effort to rein in what remains of Moscow's independent media and revitalize government-owned media. Putin's brutal war against secessionist Chechnya continues, oppositionist citizens' groups are harassed and the influence of military and intelligence forces grows. "The smell of revanchism is in the air," remarked a veteran KGB official with great satisfaction on a popular TV talk show.

Meanwhile, Russia's neoliberal economists, as they describe themselves, hope Putin will be their Kremlin Pinochet, imposing free-market policies with "a strong hand." They call for "managed democracy" and "enlightened dictatorship" and uncritically praise the former Chilean dictator. German Gref, the new, young Minister of Economics and Trade, is the group's most prominent representative. In late June the Cabinet seemed to endorse Gref's economic program, which an opposition economist calls "son of shock therapy." It is essentially the same as the policy--sponsored by the United States and the IMF and imposed by Yeltsin in the nineties--that led to the country's corruption and economic collapse. The Western media have enthusiastically endorsed Gref's program--the New York Times declared it a "bold economic blueprint"--while ignoring the fact that it calls for slashing essential housing and utilities subsidies, making higher education accessible only to the privileged, endangering the pension system and adopting a regressive tax system, including a flat tax (also heralded in the West as an ambitious reform) that will benefit only the rich and further victimize the poor. A draconian labor code, which has received less attention in the Russian and Western press, proposes abolishing labor rights and permitting a twelve-hour workday.

The Gref team is boasting that its "liberal" program has been accepted by Putin, a claim the Western media have taken at face value. But other economists--those in the opposition and also some close to the Kremlin--privately claim that the President actually has little sympathy for those shock therapy ideas and that he is using Gref's proposed policies to persuade Western financial institutions to restructure Russia's enormous external debt and attract foreign investment. (The Communist Party and its allies in the Duma oppose these policies, but Putin's supporters have a commanding number of seats and, for now, are deferential to him.)

Putin's current relationship with Russia's oligarchs, who acquired the nation's richest natural resources and other assets under Yeltsin, is even more complex. A small group of them selected Putin--then the little-known head of the renamed KGB--as Yeltsin's successor and protector of their ill-gained wealth. But the Kremlin has now begun to move against the oligarchy. In June Putin briefly jailed Vladimir Gusinsky, a leading media tycoon. And in July federal prosecutors brought charges against former Kremlin insider Vladimir Potanin, who was the recipient of one of the most corrupt giveaways of the nineties, the "privatization" of the enormous Norilsk nickel reserves. They have also seized the financial records of several other oligarchs. On the other hand, Putin and his new Prime Minister, Mikhail Kasyanov, have declared there will be no "deprivatization," and the ultimate oligarch, Boris Berezovsky, continues to exercise considerable influence.

The US media treated Gusinsky's arrest as a crackdown on Russia's independent media, particularly the mogul's television network, NTV. But most Moscow journalists will tell you that a truly free press was largely lost when the tycoons carved up the national broadcasting and newspaper properties several years ago and that Gusinsky's arrest was primarily Putin's first move against the financial oligarchy. Certainly, that's how the oligarchs themselves saw it. Immediately following the arrest, seventeen signed a letter of protest, declaring, "Yesterday, we thought we were living in a democratic country; today, we have serious doubts." Hardly known for their democratic proclivities, the oligarchs meant: Yesterday, we thought we had immunity; today, we are not so sure.

As for the great majority of Russians who live below or near the poverty line thanks to the nineties "reforms"--and who voted for Putin--the new President has shown little concern. Although Putin called for a new "social contract" in his July 8 speech, salaries and pensions remain unpaid in many parts of the country, and the labor and tax legislation advocated by his neoliberal appointees can only further impoverish ordinary citizens. And Putin has not undertaken any measures to overcome Russia's economic depression, although he speaks emotionally about the demographic crisis. As opposition economist Sergei Glazyev, who heads the Duma's Committee on Economic Policy, put it in a conversation with me, "Money produced here continues to circulate only abroad." If Putin has given ordinary citizens any satisfaction, it was with Gusinsky's arrest. Indeed, I have yet to meet anyone in Moscow who doesn't believe that most Russians would welcome the arrest of all the oligarchs, particularly the majority who are Jewish. (Nearly a decade of immiseration has strengthened anti-Semitism, always a factor here.)

Each group hoping for its version of Putin lobbies Moscow's political elite. It is, as was said about the czars, a struggle for Putin's soul. Understandably, as one political analyst here has emphasized, it is a time "when all politicians and oligarchs are living in a state of constant anxiety about the future. Everyone's position is in doubt, and anything is possible in the fight for power."

But this is only the beginning of the struggle--it's too early to tell which Putin will emerge. Among other factors that may determine the outcome, the President is clearly worried about an alliance between the oligarchs and regional governors, which might thwart his attempt to monopolize power. For example, he is trying to undermine Moscow's Mayor, Yuri Luzhkov, who is as powerful as any governor and himself the head of a rich financial clan.

Moreover, the struggle over Russia's future leadership and direction is being fought against the backdrop of two huge unresolved problems--the economic depression and the war in Chechnya. Although there is still much spinning about a new economic "boom"--largely from Western financial institutions and the media--Putin punctured the bubble in his bleak address, pointing out that "economic growth is on the brink of collapse." As for the war, no end is in sight. Chechen fighters have stepped up their guerrilla war, and the number of Russian casualties grows by the week. The war and the depression helped bring Putin to power, but if unresolved, they could undermine him.

Finally, as always in latter-day Russia, there is, for better or worse, the American factor. Apart from Washington's decisions regarding National Missile Defense and NATO expansion--both of which would further undermine any chance democratization has here--Putin's Kremlin cares far less about Washington's opinion than did Yeltsin's. Putin is focusing on Europe, especially Germany, and Asia. But it is said that he understands that any large steps he takes before November might influence the US election and thus US policy. If Putin adopts the "liberal" Gref program, it might be seen in Washington as validating the Clinton/Gore Russia policy. On the other hand, if he undertakes the statists' "strong hand" measures or renationalization of the oligarchs' property--no matter how much such measures are needed for Russia's recovery--it would suggest a failure of US policy that would benefit George W. Bush. At least in that regard, Russia is still a world power that matters.

Putin's Choice Moscow

Vladimir Putin has been Russia's President for seven months, but there is no agreement in Moscow as to who he is or what kind of leader he will be. Indeed, after three weeks here it's clear that various Russians hope for at least four different, conflicting, Putins: a savior of Russia as a great state, a neoliberal strongman, an oligarchical Praetorian and a populist who will save the people from the worst economic depression of modern history.

The "statists"--a broad coalition of security and administrative officials and nationalist intellectuals--hope Putin will restore Russia as a great power or become, as a young KGB general told me, "Vladimir the Savior." The statists see themselves as the only true patriots who can save Russia from the collapse, corruption and weakness they see as Yeltsin's legacy. (Although Putin was created by Yeltsin's Kremlin, this group and many others here see him as the anti-Yeltsin.) They want him to be a modern-day Peter the Great, taking from the West whatever Russia needs--a market economy, technology, foreign investment--and sweeping aside all opposition and obstacles to the nation's rebirth.

In his first State of the Nation address, to a joint session of Parliament on July 8, Putin gave the statists reason to believe he is the leader they want. And there are other signs. Former KGB officials are filling positions of power in the Kremlin and the regions, declaring, as a TV commentator anxiously observed, "All power to the President." Putin has launched a legislative assault on the power and autonomy of Russia's eighty-nine territorial bosses, created a new instrument of executive power in a beefed-up Security Council and indicated a readiness to reassert state control over the country's rich natural-resources monopolies privatized under Yeltsin. There is an ongoing Kremlin effort to rein in what remains of Moscow's independent media and revitalize government-owned media. Putin's brutal war against secessionist Chechnya continues, oppositionist citizens' groups are harassed and the influence of military and intelligence forces grows. "The smell of revanchism is in the air," remarked a veteran KGB official with great satisfaction on a popular TV talk show.

Meanwhile, Russia's neoliberal economists, as they describe themselves, hope Putin will be their Kremlin Pinochet, imposing free-market policies with "a strong hand." They call for "managed democracy" and "enlightened dictatorship" and uncritically praise the former Chilean dictator. German Gref, the new, young Minister of Economics and Trade, is the group's most prominent representative. In late June the Cabinet seemed to endorse Gref's economic program, which an opposition economist calls "son of shock therapy." It is essentially the same as the policy--sponsored by the United States and the IMF and imposed by Yeltsin in the nineties--that led to the country's corruption and economic collapse. The Western media have enthusiastically endorsed Gref's program--the New York Times declared it a "bold economic blueprint"--while ignoring the fact that it calls for slashing essential housing and utilities subsidies, making higher education accessible only to the privileged, endangering the pension system and adopting a regressive tax system, including a flat tax (also heralded in the West as an ambitious reform) that will benefit only the rich and further victimize the poor. A draconian labor code, which has received less attention in the Russian and Western press, proposes abolishing labor rights and permitting a twelve-hour workday.

The Gref team is boasting that its "liberal" program has been accepted by Putin, a claim the Western media have taken at face value. But other economists--those in the opposition and also some close to the Kremlin--privately claim that the President actually has little sympathy for those shock therapy ideas and that he is using Gref's proposed policies to persuade Western financial institutions to restructure Russia's enormous external debt and attract foreign investment. (The Communist Party and its allies in the Duma oppose these policies, but Putin's supporters have a commanding number of seats and, for now, are deferential to him.)

Putin's current relationship with Russia's oligarchs, who acquired the nation's richest natural resources and other assets under Yeltsin, is even more complex. A small group of them selected Putin--then the little-known head of the renamed KGB--as Yeltsin's successor and protector of their ill-gained wealth. But the Kremlin has now begun to move against the oligarchy. In June Putin briefly jailed Vladimir Gusinsky, a leading media tycoon. And in July federal prosecutors brought charges against former Kremlin insider Vladimir Potanin, who was the recipient of one of the most corrupt giveaways of the nineties, the "privatization" of the enormous Norilsk nickel reserves. They have also seized the financial records of several other oligarchs. On the other hand, Putin and his new Prime Minister, Mikhail Kasyanov, have declared there will be no "deprivatization," and the ultimate oligarch, Boris Berezovsky, continues to exercise considerable influence.

The US media treated Gusinsky's arrest as a crackdown on Russia's independent media, particularly the mogul's television network, NTV. But most Moscow journalists will tell you that a truly free press was largely lost when the tycoons carved up the national broadcasting and newspaper properties several years ago and that Gusinsky's arrest was primarily Putin's first move against the financial oligarchy. Certainly, that's how the oligarchs themselves saw it. Immediately following the arrest, seventeen signed a letter of protest, declaring, "Yesterday, we thought we were living in a democratic country; today, we have serious doubts." Hardly known for their democratic proclivities, the oligarchs meant: Yesterday, we thought we had immunity; today, we are not so sure.

As for the great majority of Russians who live below or near the poverty line thanks to the nineties "reforms"--and who voted for Putin--the new President has shown little concern. Although Putin called for a new "social contract" in his July 8 speech, salaries and pensions remain unpaid in many parts of the country, and the labor and tax legislation advocated by his neoliberal appointees can only further impoverish ordinary citizens. And Putin has not undertaken any measures to overcome Russia's economic depression, although he speaks emotionally about the demographic crisis. As opposition economist Sergei Glazyev, who heads the Duma's Committee on Economic Policy, put it in a conversation with me, "Money produced here continues to circulate only abroad." If Putin has given ordinary citizens any satisfaction, it was with Gusinsky's arrest. Indeed, I have yet to meet anyone in Moscow who doesn't believe that most Russians would welcome the arrest of all the oligarchs, particularly the majority who are Jewish. (Nearly a decade of immiseration has strengthened anti-Semitism, always a factor here.)

Each group hoping for its version of Putin lobbies Moscow's political elite. It is, as was said about the czars, a struggle for Putin's soul. Understandably, as one political analyst here has emphasized, it is a time "when all politicians and oligarchs are living in a state of constant anxiety about the future. Everyone's position is in doubt, and anything is possible in the fight for power."

But this is only the beginning of the struggle--it's too early to tell which Putin will emerge. Among other factors that may determine the outcome, the President is clearly worried about an alliance between the oligarchs and regional governors, which might thwart his attempt to monopolize power. For example, he is trying to undermine Moscow's Mayor, Yuri Luzhkov, who is as powerful as any governor and himself the head of a rich financial clan.

Moreover, the struggle over Russia's future leadership and direction is being fought against the backdrop of two huge unresolved problems--the economic depression and the war in Chechnya. Although there is still much spinning about a new economic "boom"--largely from Western financial institutions and the media--Putin punctured the bubble in his bleak address, pointing out that "economic growth is on the brink of collapse." As for the war, no end is in sight. Chechen fighters have stepped up their guerrilla war, and the number of Russian casualties grows by the week. The war and the depression helped bring Putin to power, but if unresolved, they could undermine him.

Finally, as always in latter-day Russia, there is, for better or worse, the American factor. Apart from Washington's decisions regarding National Missile Defense and NATO expansion--both of which would further undermine any chance democratization has here--Putin's Kremlin cares far less about Washington's opinion than did Yeltsin's. Putin is focusing on Europe, especially Germany, and Asia. But it is said that he understands that any large steps he takes before November might influence the US election and thus US policy. If Putin adopts the "liberal" Gref program, it might be seen in Washington as validating the Clinton/Gore Russia policy. On the other hand, if he undertakes the statists' "strong hand" measures or renationalization of the oligarchs' property--no matter how much such measures are needed for Russia's recovery--it would suggest a failure of US policy that would benefit George W. Bush. At least in that regard, Russia is still a world power that matters.

  • Share
  • Decrease text size Increase text size