REP Roundtable Summary Beyond the Putin System Mikhail Kasyanov Former Prime Minister of Russia 17 November 2009 The views expressed in this document are the sole responsibility of the speaker and do not necessarily reflect the view of Chatham House, its staff, associates or Council. Chatham House is independent and owes no allegiance to any government or to any political body. It does not take institutional positions on policy issues. This document is issued on the understanding that if any extract is used, the speaker and Chatham House should be credited, preferably with details of the event. Where this document refers to or reports statements made by speakers at an event every effort has been made to provide a fair representation of their views and opinions, but the ultimate responsibility for accuracy lies with this document’s author. The published text of speeches and presentations may differ from delivery. REP Roundtable Summary: Mikhail Kasyanov, ‘Beyond the Putin System’ Much has changed in Russia since 2000, when the country was actively modernising and there were significant moves forward, particularly in the economic sphere. After the default of 1998, which wiped out the middle class and led to a complete rethink of fiscal policy, wide-ranging reforms were launched. The government taught people and business the importance of paying tax, why they should pay for heating and electricity. From growth rates of 3 per cent at the turn of the century we reached 7-7.5 per cent growth even though the oil price at the time was around $25 a barrel, not $145 as it was prior to the global financial crisis. During Putin’s second term, all democratic institutions were gradually abolished. There was hope in some quarters that the arrival of Dmitry Medvedev would lead to more liberal policies, as the new president would try to widen the gap between himself and Putin. One and a half years on there is little sign that the rhetoric has been translated into deeds. Instead of reform there has been a constitutional change extending the presidency to six years, a war in Georgia, gas cut offs and a new Khodorkovsky trial which has nothing to do with jurisprudence. Medvedev has proven his loyalty to the Putin system. On 12 November Putin gave his second address to the Federal Council. He criticised the economic situation in Russia, spoke of the risk of dependence on oil and gas revenues, underlined the dangers of Russia’s ageing infrastructure, and admitted that corruption has reached unparalleled levels. President Medvedev’s evaluation is accurate. One could applaud his bravery for speaking about these problems. But Medvedev’s evaluation has been forced on him by the reality of the situation. One cannot hide from the economic problems facing Russia. When the global financial crisis first appeared in October 2008, the elite declared that Russia would be an island of stability. However, in contrast to the rest of the so-called BRIC countries, Brazil, India and China, which are still enjoying growth rates of 6-8 per cent, Russia’s economy has contracted sharply. Despite this, Medvedev had nothing to say about the political system or the recent farcical local elections. He regards the existing political system as almost perfect. Referring obliquely to the opposition, the President promised to forcefully prevent any effort to divide society. Medvedev argues for modernisation, but he does not believe that political reform is required in order to achieve it. In seeking support for his half-hearted modernisation strategy, Medvedev is asking people to give him legitimacy. However, most Russians do not regard Medvedev as an independent politician. They can’t imagine Medvedev without Putin, so his words carry no weight. The economic www.chathamhouse.org.uk 2 REP Roundtable Summary: Mikhail Kasyanov, ‘Beyond the Putin System’ crisis will not lead to reform as it did under Gorbachev. No one in the elite will make any move which might risk upsetting the current system of power. Instead, they continue to tighten the screws. A one-and-a-half party system has been established. The system of electoral democracy has entirely disappeared, as shown by the shameless falsification of the recent local elections. In Moscow, for example, many businesses compelled their employees to vote with absentee ballots. Not just democrats but apparently loyal bureaucrats were barred from standing. In response even the tightly controlled opposition chose briefly to boycott parliament. The crisis of human rights in the country has increased the values gap between Russia and the West. It compels the West to treat Russia as a country alien to European norms and values. In recent months we have seen attempts to cooperate with Russia on a range of issues, such as proliferation and Iran’s nuclear programme. Such overtures are comprehensible from the western point of view, but they are interpreted as a sign of weakness by Moscow. The regime in Russia wants recognition of the legitimacy of the Putin system. The reset can do nothing to overcome the values gap. In terms of transparency, freedom of expression or economic liberalism, Russia is far behind the West; it is more closely aligned with North Korea and Iran in terms of ideals. For the leaders, elections mean appointments, a humanitarian operation means war, human rights and civil society means government dictat. Russia is still in contravention of the agreements reached with the EU after the war in Georgia. Nevertheless, the EU quickly lifted its veto on negotiations on a new Partnership and Cooperation Agreement. NATO has, likewise, quickly returned to business as usual with Russia. The political elite in Russia have therefore concluded that the West will provide no robust resistance to its foreign policy actions. A year after the economic crisis emerged, it’s clear that the regime has been relatively successful at managing the public mood. The political atmosphere is not as tense as one might imagine; the situation feels relatively stable. The Putin system can last for several more years thanks to an overwhelming propaganda machine and largely effective means of coercion. Twenty years after the fall of the Berlin Wall these mechanisms still function effectively. The system is not capable of reform. Putin has removed all institutions of democratic accountability and tamed the media. This means there is no feedback loop for the elite. Unlike under Gorbachev, the nomenklatura is so afraid of freedom, and the changes in power structures that this might provoke, that they will not allow any move towards liberalisation. It was clear from Medvedev’s speech that he has no intention of changing the political www.chathamhouse.org.uk 3 REP Roundtable Summary: Mikhail Kasyanov, ‘Beyond the Putin System’ system. It is likely that Putin will return to the presidency in 2012. The system of crony capitalism will remain. Many in the elite would support this. They see clearly the failings of this political model but also recognise that it is simple, reliable and generally predictable. The local elections were a rehearsal for the stage-managed process in 2012. Where could change come from? The longer the system remains as it is, the greater corruption will become. The possibility of Russia disintegrating could again appear on the agenda. A low level conflict persists in the North Caucasus; not just in Chechnya, but in several of the ethnic republics. Regional elites now see Moscow as incompetent at best. We could see a return to the ethnic bargaining of the nineties, when certain regions sought to squeeze more resources and autonomy from the centre. This will become more likely should oil prices fall. There is also growing discontent amongst the elite. Medium and even big business is growing increasingly frustrated by the stagnation at the top. Liberals in Russia and outside it should put the regime under pressure. We need to maintain criticism and undermine the illusion that Russia’s system is normal and acceptable. Questions and Discussion Does the leadership have a policy on the North Caucasus? What is Moscow trying to achieve? Putin’s intention is to transfer as much responsibility as possible to local leaders. They are put in charge of security and local administration despite clear shortcomings. A lot of concessions over autonomy and federal subsidies have been made to Chechnya, for example. This is a dangerous policy which is not bringing real security to the region. Just five years ago in Dagestan there still existed an important mechanism of stability whereby representatives of the republic’s ethnic groups discussed common problems and disputes. This no longer operates. The only solution to the problems in the North Caucasus is dialogue. It will be a very long process to establish rules by which everyone in the region is willing to live. Of course one has to consider the historical legacy of the Caucasus, but it is nevertheless a part of Europe, and life there should be governed by the same basic civilisational values. www.chathamhouse.org.uk 4 REP Roundtable Summary: Mikhail Kasyanov, ‘Beyond the Putin System’ How do you evaluate the EU’s approach to Russia, especially that of leading players, such as Germany. Do the Germans appreciate the gap in values, or is their policy governed largely by Realpolitik? It is important to separate out the interests of the people and the ruling class in Russia. The two do not coincide, indeed they are diverging. The EU and the US should note this divide and put pressure on the elites whilst engaging the people. The West must stick to its principles and insist that Russia implement its international obligations. The blueprint of a law-bound and internationally responsible state already exists in domestic Russian law and international agreements.