Russia: Other Points of View

RUSSIAN FEDERATION SITREP

by Patrick Armstrong

Olympic corruption. Navalniy has put out his corruption report. Not very impressive; mostly assertions. He agrees with Putin that the Olympic facilities, narrowly defined, cost US$6-7 billion. He thinks a 50-km road-rail route in difficult terrain up to the ski centre is very excessive at US$8 billion. (Follow the route yourself on Google Maps: not an easy one). He mentions a couple of occasions where people have been arrested for corruption. Various contractors are said to be Putin’s “friends”. Yes, a lot of money has been spent – US$40-50 billion – but it’s a huge infrastructure operation to create a permanent tourist resort complex, not just a few weeks of winter sports. Anyway, here’s his report, see whether he convinces you that enormous sums have disappeared without a trace. In a week or so you can see for yourself what’s been built: “We have to see that what we did in the Alps we needed 150 years and they had to do it in five years”.

Sochi double toilets. The story’s all over the place, latest here. But you’ve been had. Again. Read this.

Corruption. Quite a bit in the last two weeks. The nets seem to be catching bigger fish. A deputy chief of police in Moscow arrested for taking bribes. The deputy PM of Dagestan busted for fraud. A former member of the Dagestan parliament (and, for those who think they’re exempt, a stalwart member of Putin’s support party, United Russia) ditto. But, as usual, military-connected events lead the pack. A criminal case was opened against Serdyukov’s brother-in-law (I don’t believe that Serdyukov’s out of the soup yet – passing the loot off to family is a common practice). The DG of an important shipyard “suspected” of embezzlement. The Prosecutor General said inspections of the defence industry had uncovered “a huge number of violations” and 48 criminal cases have been opened. You have to agree that while there haven’t been many convictions, there certainly have been plenty of arrests.

RUSSIAN FEDERATION SITREP

by Patrick Armstrong

RUSSIA DEBATE. My colleague Anatoly Karlin has created a website The Russia Debate as a repository for the healthy discussion throughout the English Russophere. The idea is that it would become the go to spot for discussions about issues pertaining to Russia arranged by topic and searchable. At the moment an enormous amount of this discussion happens on Mark Chapman’s site The Kremlin Stooge. All sorts of highly intelligent and useful information may be found there but it is not user-friendly. So I ask you to patronise The Russia Debate and build it up as a repository of the collective wisdom. And those of you who observe but do not participate should scout it too.

THE FAILURE OF PUTINISM. The Russian birth rate in 2012 actually exceeded the US birth rate. The World Bank ranks Russia as the fifth largest GDP in the world by purchasing power, displacing Germany, and eighth over all.  The long-predicted collapse must be postponed. Again.

CORRUPTION. Arrests and investigations: tax officer fraud; parliamentarian extortion; regional minister bribes; gang illegal money transfer; mayor corruption; Serdyukov again and again; Armed Forces. Convictions: Khimki City official for violence. And Navalniy. And Browder. And a former Tula governor. See below.

RUSSIAN FEDERATION SITREP

by Patrick Armstrong

Electoral system. In the beginning, the Duma’s 450 seats were chosen half by party list and half by single mandate with a 5% threshold. Then Putin I changed it to all party list and 7% threshold. Putin II has just sent a bill to the Duma to change it back to the original. So what was the point of all that? The new law forbids electoral alliances – obviously another attempt to force like-minded people to unite. But we have 20 years of observational experience that Russian liberals refuse to sink their (small policy but large personality) differences. On a personal note, I was an observer in the 1995 election when 40-some parties ran. The party vote ballot was the size of a newspaper sheet and few voters had a clue. Are we going back to that?

Corruption. Investigations all over the place. Phoney academic degrees; embezzlement at RusHydro; two frauds in the Penitentiary Service; tax evasion at RUSAL; a former Duma Deputy. And not to forget OboronServis: Prosecutor General Chayka says 25 separate cases have been combined, the total cost of which is now said to be over US$400 million. The MoD is target-rich: a general is suspended, a former financial administrator jailed, a possible rotten rations scandal, and a supplier case. And the Olympics appear on the horizon: cost inflations. Sergey Ivanov has said that no one is immune. The Central Bank has weighed in with a statement that illegal money transfers amounted to US$49 billion in 2012 and that every tenth company making settlements through its payment system dodged tax payments in 2012. Obviously these cases have been in preparation for some time and investigators are digging. Definitely a serious campaign.

RUSSIAN FEDERATION SITREP

by Patrick Armstrong

Book plug. Please take a look at this: Putin’s New Russia. A number of us have contributed in an effort to counter the continuous outpouring of slipshod and biased reporting on Russia.

Local elections. United Russia dominated; the opposition cried foul. Turnout rather low but better in the five regions electing governors (all five drearily United Russia). But what is the “opposition” anyway? opposed to Putin yes, but agreed on what? See next.

Demos. Another large opposition demo passed off peacefully last month. The opposition is becoming more fragmented by the day; an eyewitness tells me about supernationalists yelling at PARNAS: “Russia without Jews!” and insulting gay rights campaigners; anarchists telling the white ribbon people to take up the black flag of anarchy; Udaltsov’s Red Front calling for Lukashenka to head a Russia-Belarus union; Monarchists calling Nemtsov a Russophobe. As if Nazis, Communists, and Occupy people all shared a stage shouting at each other with the occasional ???? appearing.

Udaltsov. An NTV program ran a film supposedly showing him plotting civic disorder with a Georgian politician: he insists the film is a fake. The Russian Investigative Committee has opened a case. I have nothing intelligent to say: it could be true or it could be a fabrication designed to knock him out.

RUSSIAN FEDERATION SITREP

by Patrick Armstrong

The cards are re-dealt. After the usual considerations, negotiations and calculations, the re-shuffle is probably complete. There is a new government with many new faces. A new Security Council – most positions ex-officio. Defence is unchanged (many thought Serdyukov was going to go) but there is a new Interior Minister (police reform has proved to be somewhat unfinished). Sergey Lavrov continues as Foreign Minister. True to his habit, Putin has sent no one into the darkness; many of the old faces being “kicked upstairs”. Neo-Kremlinologists are scrying the auguries but as far as I can see, we have the same Team, with new people moved up from the “farm teams”. What ought to be apparent, after more than a decade’s observation, is that Putin has created a remarkably collegial, discreet and effective team. He’s had a few former insiders join the opposition but (I can’t resist) nothing like Saakashvili who has seen almost every former minister, associate and ambassador go into the opposition. Further thoughts coming Friday here.

Demographics. More good numbers: births up and deaths down and a fertility rate that is rising into the middle of developed countries. Anatoly Karlin has a discussion and summary of the first quarter’s numbers. The improvement is clearly not a “blip” but it’s not yet clear whether it is long-term. I have a question. We know that fertility rates can change suddenly (vide the “baby boom” in Canada and the USA after the war and the dramatic drop in Quebec in a few generations). All kind of personal factors come into play: national pride, hope (or not) for the future, affluence, education, religious beliefs and many more – millions of individual decisions that are mysteriously in step. My speculative question is this: might it be possible that positive factors are coming together in Russia and that its fertility rate might continue to grow? A few generations of Europe with negative fertility and Russia with positive would make a different world Something to watch.

RUSSIAN FEDERATION SITREP

by Patrick Armstrong

Vorstand reshuffle. Putin was inaugurated on Monday and, as promised, immediately nominated Medvedev as PM. He was confirmed by the Duma the next day (Communists and Just Russia voting against). I was intrigued by their first reported actions: Putin ordered the creation of a business ombudsman to defend “the rights of entrepreneurs” showing that improvement of Russia’s business climate is a high priority. Medvedev called for a new system of state defence orders. This last has been notoriously opaque; many complain the money is not wisely spent and Russian-made weapons are over priced and not modern. Note that each of these touches on corruption: there are those who think that Putin returned to the Presidency because only he has the political muscle to attack this pervasive problem. Perhaps so, we will see. I still think that we need to see someone in an office close to the two led away in handcuffs for an anti-corruption drive to really bite.

Foreign policy. Putin quickly issued a host of decrees, one on foreign policy. The first priority is “to assist in creating favourable external conditions for the Russian Federation’s long-term development, modernisation of its economy, and strengthening its positions as an equal partner on global markets.” The second is “to seek to assert the rule of law in international relations, to advocate the leading role of the UN in global affairs and the fundamental principles of the UN Charter that require the development of friendly relations between nations on the basis of equality, respect for each others’ sovereignty and territorial integrity…” This is a country that wants a quiet life so it can develop its economy.

RUSSIAN FEDERATION WEEKLY SITREP

by Patrick Armstrong

Note from the author: 

NO MORE SITREPS UNTIL LATE NOVEMBER.
 
Dear Readers: today’s is the 611th of these since the first one in March 1997. I normally have no difficulty in filling the page but, of late, I find that that it is more and more difficult. This is, I believe, another indicator of the increasing stability and “normality” of Russia’s situation. In former times we had “the Eastern Question” or “the German problem” and so we have had “the Russian problem”. But, as the others faded away (over time and much pain) so will this.

I will consider, when I get back, whether I can continue the weekly schedule or switch to every two weeks.

Demographics. The Russian demographic problem – which, incidentally, has its roots in the Soviet days and is mirrored in most FSU countries (Latvia perhaps the worst) – was the consequence of problems at each end. Low birth-rates and high infant mortality combined with too many early (and largely preventable) deaths. But, contrary to the customary poorly-sourced pieces that the Western MSM is rife with, progress is being made. Anatoly Karlin has been posting on the subject for several years and is well worth reading. His latest argues that Russia’s population has actually increased and is today higher than it was in 2009. While the natural population increase is still negative – but less and less so every year – the increase has come from immigration. Improvements have been made at both ends of the problem but Karlin provides data showing that deaths by alcohol, suicide and homicide have seen great reductions. They are still rather higher than they should be but these are factors where comparatively easy resolutions can be found. In short, it appears, barring some new disaster, that the Russian demographic crisis is on the way to being solved; that the various government programs are having their effect and that increasing prosperity will continue to raise life expectancy and reduce infant mortality. Thus Russia’s “demographic crisis” is yesterday’s news and the improvements – with more expected – serve as another of the many reasons that Russians generally approve of the Putin team. It cannot be said too often that the reasons for the Team’s popularity, trust and support in Russia is not that opinion polls are fixed, or that the mass media is as it was in the Soviet days or that Russians are naturally subservient (all assumptions of the Russophobic tendency) but because Russians can see every day the effect of a governing team that, generally speaking, does what a government is hired to do.

RUSSIAN FEDERATION WEEKLY REPORT

by Patrick Armstrong

Eurasian Union. Putin has spoken of his desire to form a “Eurasian Union” and this has attracted some attention. This is hardly the first time, though, that he has spoken of such a thing. We already have the Russia-Belarus union, which doesn’t seem to amount to much; the Customs Union of Russia, Belarus and Kazakhstan, which is still in its infancy; the Shanghai Cooperation Organisation of Russia, four Central Asian countries and China and several partial members which is largely security-based. And, of course, the CIS which is as yet undead.  None of these is especially vibrant. Moscow and Astana have been the prime movers of most of them and they are founded on the remaining common economic/trade and security concerns of the countries involved. Perhaps the Customs Union will be expanded farther; that will depend on how successful it proves to be. There is, therefore, nothing especially new about Putin’s desires. However some things have changed in the 10 to 15 years that these ideas have been floated. The most significant change is that the attraction of the West/European “model” has waned somewhat. The dreams of acceptance, integration and equality that were alive in the 1990s have been replaced with a rather drearier reality. And the reality – unexpected 15 years ago – that Russia is doing best.

THE RUSSOPHOBES WERE RIGHT... (ABOUT THE WRONG COUNTRY)

REPRINTS

by Anatoly Karlin

www.sublimeoblivion.com 

After peaking in 2007 at the height of its oil boom, the Russian economy slid off the rails, with GDP collapsing by 25% from peak to trough. Attempts to stem the decline by arresting pessimistic economists failed. Its image as a tiger economy, heavily promoted by Kremlin ideologues, was revealed to be a sham. Though anemic, growth returned this year; but little of it trickles down to ordinary Russians. Unemployment is over 16%, birth rates have collapsed, and millions of citizens are voting with their feet and migrating to work as laborers in affluent Western Europe.

This demographic free fall threatens to dash any remaining hopes of Russia ever converging to European living standards. Birth rates have fallen by 25% since the post-Soviet era peak in 2008, and the total fertility rate ­ the average number of children a woman can be expected to have over her lifetime ­ is now one of the lowest in the world, surpassed only by a few small, rich Asian states like Taiwan and Singapore. And with young professionals rushing for the exits, this situation is unlikely to be reversed any time soon. Last year, half a million people out of Russia's 143 million population left for greener pastures; this figure has already been exceeded in the first half of this year. Already falling at an alarming 840,000 in 2009, population decrease further rose to 1,220,000 in 2010 and on current trends will approach 2 million this year. This demographic death spiral is the epitome of Putinism's failure. The Leon Arons and Nicholas Eberstadts of this world were correct all along. Having been a Russophile shill all these years, it is time for me, like Johann Hari, to admit to my failures, apologize to the readers I misled, and go back to journalism school.

RUSSIAN FEDERATION WEEKLY REPORT

by Patrick Armstrong

Police reform. The Interior Minister says police who may be exposed to temptations of bribery will have to take regular lie-detector tests. He is pretty pleased with the results of the “combing” process. I think, to put it mildly, he’s over-optimistic. The Investigative Committee says that police officers have been charged with 70 crimes in the last 10 days. And that’s the ones they’ve been charged with. Obviously the teeth on the comb were set too far apart.

Politkovskaya. Perhaps a break-through: a former policeman, Dmitriy Pavlyuchenkov, was arrested and charged with organising her murder. The theory is that he was a contractor and the investigators say they know who ordered her death. The prosecution theory has always been that the man who ordered it is no longer in Russia. Pavlyuchenkov’s name came up early in the case but he seems to have been able to avoid charges and apparently functioned as a sort of secret witness for the prosecution. From the beginning I have believed that she stumbled – perhaps unknowingly – across some piece of information a Chechen “biznesman” didn’t want known. Nothing to do with Putin or the government.