The State of Russia: What Comes Next?

Nikolay Petrov, Maria Lipman, Nikolay Petrov, Maria Lipman

• Publisher: Palgrave Pivot
• Year: 2015
• Print ISBN: 9781137548108
• eBook ISBN: 9781137548115
• Topic: Politics & International Relations
• Subtopic: American Government
• Index: Politics & International Relations

Following the crisis in Ukraine, the Putin regime made political choices that will determine Russia's development for years to come. This cutting edge Pivot makes a key contribution to the debate on Russia's development and traces emerging trends in various spheres of Russian life, from the economy and foreign policy, to society and ideology.

1

Post-Crimean Political Order

Boris Makarenko

Abstract: The anti-modernization trend will become the main feature of the country’s political regime for the immediate future – this trend dooms the regime to stagnation, making any attempts at technocratic renewal futile. In order to keep the situation under control, the regime will inevitably resort to greater, most likely pre-emptive, and therefore disproportionate, repressions, which will further exacerbate political conflict. The main question that will determine the predictions of the political regime’s future is how stable it will be under the new conditions and what hypothetical solutions for overcoming stagnation it will have at its disposal.

Lipman, Maria and Nikolay Petrov. The State of Russia: What Comes Next?. Basingstoke: Palgrave Macmillan, 2015. DOI: 10.1057/9781137548115.0005.

Farewell to modernization hopes?

By 2014, Russia had completely exhausted all the possibilities for an inertia scenario. As was described in our Russia 2025 project,¹ after his return to the presidency, Vladimir Putin attempted to combine two different scenarios: on the one hand, he sought to retain his regime’s framework with its elites’ coalition pyramid which monopolized control over the relations between power and property; on the other hand, he intended to partially reform the political system.

Under a different set of circumstances, the ruling elite could probably avoid the ultimate choice of a development model for a few more years. However, the Ukrainian events, especially the annexation of Crimea, signaled that the choice had been made. The external, internal, and socio-economic implications of the Crimean decision make the modernization scenario impossible for Russia.The scenario that allowed for both inertia and reforms that could take on a life of their own seemed likely, albeit not the only possible scenario two years ago. At this time, however, it transformed into a ‘forced inertia’ scenario, which leaves no room for progressive development. Here is the rationale behind such a conclusion.

First, lack of economic growth threatens to morph into a full-fledged recession; strained relations with the West and lack of certainty lead to capital flight, dashed hopes for investment growth and higher interest rates. The recession forces further centralization of regions, which strips the regional governments of initiative and stimuli to look for growth strategies (see Chapter 3). The West stops cooperating with Russia and starts containing it in all areas where cooperation is not necessary, and modernization is hardly possible without dynamic cooperation with the most advanced economies.²

Second, confrontation with the West sharply increases protective and reactionary trends. The regime no longer cares about development, reforms, and transformation. Instead, it preaches protection from ‘going backward and downward’, citing the authority of Nikolai Berdyaev.³ Third, as the socio-economic situation deteriorates, the regime will try to offset the growing discontent by stimulating the rise of patriotism and imposing resistance to ‘foreign values’. True, this position is more characteristic of neocorporate regimes; some of them were quite capable of authoritarian modernization – under condition, however, that authoritarianism was being used to mobilize resources and suppress resistance to unpopular reforms.

Just as with all other facets of the Russian situation, the ‘Crimea factor’ has not changed the direction of the old trends but rather accelerated them. While the regime’s tactics previously included both inertial elements and striving for controlled change, which could gradually acquire its own dynamics, the ruling elite is now concerned exclusively with the preservation of the current regime. But in reality, standing on the down escalator means going down.

In keeping with a long-standing Russian tradition, the ruling regime is trying to retain the role of the only subject in the country’s politics and thus will not hesitate to resort to harsher means to achieve the desired results. Therefore, the regime will continue relying on the paternalistic majority, and pursue the course of isolation and marginalization of the minority that attempts to claim its right to influence politics. To retain the support of this majority as the public benefits continue to diminish, the regime has to resort to cruder and more ideology-driven social mobilization mechanisms that allow it to maintain the status quo. More importantly, institutional reforms are impossible under such a scenario – they would undermine the regime’s support base, while the regime’s flexibility is approaching its limits.

The comparisons of the current situation and the reign of Nicolas I (1825–55) are becoming increasingly more common. Here is how Vasily Klyuchevsky characterizes the emperor, ‘Nicolas made it his aim not to change anything, not to add anything to the foundations but only sustain the existing order, replenish the gaps ... and do it with no public input, in fact, by suppressing public initiative.’⁴

The end of Nicolas’s rule coincided with the Russian defeat in Crimea, while the current acquisition of Crimea seems like a new lease of life for the regime. However, it is still too early to tell what its long-term impact on Russia’s development will be.

Our subsequent discussion is based on the premise of the relative status quo in Russia–West post-Crimea relations. The West has elected for the strategy of containing Russia, which, while having its long-term effects, will not trigger further escalation. In this case, to preserve itself, the regime should minimize the damages that result from this confrontation; it should gradually assume a less confrontational posture in its relations with the outside world and avoid drastic moves vis-à-vis the elites it controls and the uncontrolled political forces. Another scenario – which would become practically inevitable in case of a fully fledged confrontation with the West – would turn Russia into a purely authoritarian state.

Regime legitimacy as a key variable

Age-related ailments that afflict the Russian regime and others like it are well-known; they make up a constellation of interconnected disorders: decreased efficiency, eroded legitimacy, and the issue of succession. The problem of legitimacy appears to be the most important. Essentially, it can be reduced to two basic components: how we are ruled (how efficiently the regime serves the needs of the people) and how much the rulers deserve our trust. Even in the past, starting in 2011, these components have developed along diverging tracks.

Performance legitimacy (the regime’s ability to satisfy socio-economic needs) was also declining in the past. The model of sustaining social well-being reflected in Putin’s third term socio-economic program (the so-called May decrees of 2011) relies on completely different growth rates. In other words, it simply cannot be implemented without infringing on other state expenditures. However, this situation is not expected to cause legitimacy collapse: society still has quite a high tolerance level, and the regime is still strong enough for ad hoc responses to sporadic flare-ups (for instance, assisting regions or towns that face extreme hardship financing their social spending). The regime will increasingly use the ‘carrot’ approach to resolve these problems: protests are now out of vogue, and the ‘Crimean consensus’ is still strong, which obviates the need for a ‘stick’ that would disperse protest rallies. However, it would be wrong to make it a long-term prediction. At any event, social optimism disappears in this context, and the public cannot be easily mobilized to support the regime (during elections and beyond).

One of the reasons why the Russian regime cannot be efficient is that politics and policy are assigned separate realms in Russia. The ‘presidential vertical’ dealt with politics, managing governors and the ruling party, elections, relations with the opposition and public politics. On the other hand, the government and local executives dealt with policy. Naturally, one cannot draw a clear distinction between the two: any ‘big politics’ decision has a direct impact on policy – for instance, prohibiting imports from countries that imposed sanctions on Russia. Policy-making structures were never particularly good at predicting social reaction to their moves, and with the disappearance of political competition, they lost their predictive abilities altogether. Hence, numerous scandals and upheavals related to school reform, ‘optimization’ of medical facilities, sharp price increases in the housing and utility sector, and cuts in social subsidies. Losses from the rift between politics and policy continued to grow as the state struggled to ‘optimize’ social expenditures (in reality, it means cutting spending and making the regions shoulder the burden).

Institutional reforms played an extremely limited role in the regime’s agenda. The regime preferred ad hoc management that preserves its power monopoly to formulating binding and universal rules of the game. When it did try to embrace universal rules, its success was rather limited. For instance, implementing the road maps that would move Russia up in the World Bank The Ease of Doing Business ratings (the project directly monitored by the president) was successful in one of the three critical areas (getting electricity). Efforts to improve the two others (dealing with construction permits and trading across borders) failed miserably. At the same time, state regulation is becoming more and more excessive. The Ministry of Internal Affairs regained its right to initiate criminal prosecution on tax violations. The rules of the game are unpredictable, which every Russian business association is complaining about – for instance, the unexpected tax hike on commercial property will exacerbate the already complicated situation for small businesses as consumer demand declines and bureaucratic pressures and corruption increase. Attempts to stimulate the economy through mobilizational measures and substituting international economic and production structures for their domestic equivalents, or increasing the tax burden on small businesses and the middle class, can hardly be economically efficient. Rather, they will bring the most dynamic part of society over to the opposition camp.

Another important component of the regime’s inefficiency is the recognition of its unjust nature by the overwhelming majority of society (including those who vote for it). The Levada Center’s December 2013 poll conducted at this author’s request highlighted the entire hierarchy of institutions and practices that respondents believe to be most lacking in the Russian society. The four most common answers were: citizens’ equality before the law (54 per cent), independent judiciary (44 per cent), fair and honest elections (41 per cent), regime’s accountability to the public (35 Per cent). The recognition that these elements are lacking actually reflects the popular concern with the ‘injustice of the state’.⁵

This component of the regime’s legitimacy has already been undermined, and there are no indications that this condition might be reversed. However, it is not going to bring about drastic delegitimization in the foreseeable future unless a large-scale economic crisis develops.

The second component of legitimacy is the recognition of regime’s symbolic leadership, which is essentially reduced to personalized power in the case of Russia. Until recently it seemed that this component has also been significantly eroded. Putin’s return to the presidency came at a substantial cost: part of society interpreted it as a sign of the regime’s permanency and lack of prospects for both personal development and the development of the country as a whole.

The growing demand for greater openness and competition in political life also indicates that personalized legitimacy is being eroded. This is not a demand for a regime change, but rather for its greater accountability and the right to criticize and challenge its activities. The ...

Table of contents

• Cover
• Title
• Introduction. The Post-Crimea Russia: Development Scenarios
• 1  Post-Crimean Political Order
• 2  The Russian Economy at the Start of the Post-Putin Era
• 3  The Relations between the Center and the Regions
• 4  Russia Reinvents Itself as a Rogue State in the Ungovernable Multi-Polar World
• 5  Putins Relapse into Totalitarianism
• 6  Putins Besieged Fortress and Its Ideological Arms
• 7  Conclusions
• Index