1. Dual Power?

2. Russia’s new image
Russia is recovering, it asserts that it is a great power, as it has been in the past
The crisis of post-communist transition is over
Continuity with the past is restored
The Kremlin – the fortress at the center of Moscow
The capital of the biggest country on Earth
The cathedrals built in the 15th and 16th centuries assert the central role of Orthodox Christianity
The guards dressed in the fashion of 1812 – the glory of Russian victories
Victory Day parade (May 9, 2008) further emphasized this theme: we are strong, proud and independent

3. But: a new President was elected
He vowed to honour the Constitution
And – there are two rulers at the top of the recovering Russian state
President Medvedev and Prime Minister Putin
This is really perplexing
For the Russian bureaucracy, in the first place

4. Even a democratic state gets wobbly when there are two top political executives with similar levels of authority
The Roman Empire? There the division was territorial – and it did lead to wars between the rivals
In Byzantium, there were times when two emperors would be in charge, but ultimately one would push out the other one way or another
In Russia – lots of precedents, all of them resulting in one side establishing primacy, the other side being either completely destroyed or marginalized, turned into mere window dressing

5. As Russian transitions go, it was unusual
A Russian head of state has left his post despite the fact that he is alive, well, still young, and very popular – because he is regarded as a very successful, effective leader
So, many Russians actually preferred to see Putin stay for 3d term
But there is the Constitution

6. Why not change the Constitution?
Fear of instability
Won’t look good internationally
So, can you keep Putin in power without changing the Constitution?
Yes, you can!
His closest lieutenant will be president
And he will be a powerful PM
So, they’ll govern together
And then, maybe, Putin will run for President again

7. Putin’s speech at the Parliament in February 2020 speech
We were in a situation of deep crisis 8 years ago
But we have found our way out of the crisis
Russia is on the right track
It is safer, stronger
Economy is growing, incomes are rising
Huge problems still remain, but we’ll solve them
So, steady as you go – to 2020
The coming Medvedev Presidency looks like a vehicle to implement the Putin Plan

8. CIA:
..\Russian economy\CIA-07.doc

9. So, are we to expect more of the same under the new President?
Is the Putin Plan working?
Sergei Mitrofanov, a Russian politician:
“In Russia, the paradigms “Everything is clear” and “Nothing is clear” are tightly bound together, and both work equally well at the same time.”

10. Will Medvedev be a liberal or a conservative?
Will he be a Putin puppet – or his own man?
Will the Putinists try to capture the Kremlin back?
What deals are being made behind closed doors – and by whom?
Will energy prices stay high?
Will the state pick up the debts of state corporations?
Will inflation grow?
How will Russia behave in the international arena?

11. 3 points main points about Putin’s Russia:
1. Looking back, most Russians feel that the country has made significant progress – and is on the mend
2. Looking around and forward, they see huge problems
Some of them – inherited from the past
Others – created in the Putin years
3.Putin has served as a transition manager
But the transition isn’t over yet
And in the next phase, the Putin legacy will be treated pragmatically – whatever works

12. The key domestic challenges
Modernization of the economy
Rebuilding infrastructure
Social investments
Crucial: ROLE OF THE STATE

13. Economic growth is a result of not just higher oil prices
ROLE OF THE STATE
Economic growth is a result of not just higher oil prices
Also – result of a restoration of the Russian state
The state needed to be rebuilt
That rebuilding has been done by very crude methods
Not only involved increasing abandonment of liberal-democratic norms
But also made the state weaker in its ability to tackle the problems faced by the country
WHY?
Bureaucracy is bigger, more powerful, more corrupt, and less accountable
Among the bureaucrats, the Enforcers have gotten too strong, other elites resent this
Rule of law, always an endangered species in Russia, suffered further setbacks

14. Business climate in Russia
(poll of 1200 executives, WCIOM, Nov.07)
54% - report successful development of their businesses
On 11 indicators of “business climate” – “bad’ or “so-so”
Especially hard to start a new business
Govt policy is criticized
Bureaucracy, corruption
OVERWHELMING: need for clear and strictly observed rules (63%)

15. WCIOM poll, Oct.08
What kind of state do you want Russia to be?
42% - a democratic system with a market economy (down 6% in 10 years)
16% - a socialist state with a communist ideology (down 4%)
21% - a state with its own type of system and its own path (up 3%)
3% - monarchy and empire (down 3%)

16. 55% - country going in the right direction
WCIOM poll, Jan.08
55% - country going in the right direction
20% - not (down 10% from 2004)
56% - Russia needs stability, evolutionary reforms
29% - radical reforms (down 10% from 2004)
51% - revise results of privatization, unfair and illegal
29% - No (down from 36%)
51% - all peoples of Russia must have same rights and opportunities
37% - interests of ethnic Russians must be uppermost
56% - treat post-Soviet states as all others
25% - Russia must try to dominate

17. Deep depoliticization of the society
Russians are becoming more and more private people
I’ll take care of myself
Voting doesn’t change anything
Let the govt do its work
Trust the President
Still, upsurges of activism are usually provoked by the state (e.g. monetization)
Opposition movements are marginalized

18. In the international arena, Russia must strive to establish closer relations with the West
Yes - 60:24
Almost isolationist
Moderately nationalist

19. Russia is in a conservative phase In a triple sense:
The new ruling class is determined to maintain its wealth and power
The public is depoliticized and values stability
Emphasis on Russian identity and traditions as distinct from Western values
And yet, Russia must modernize without delay
Can Russia’s modernization be carried out while society is in this condition?

20. Putin’s 20/20 speech:
“…a strategy of innovation-based development of the country, based on our key competitive advantage – the human potential, on the most effective use of human knowledge and skills for constant improvement in technology, economic results, and quality of life.
Massive investments in human resources needed – and recognized
But it is not just investments – human motivations are more complex
Individual freedom is a key value for new generations of Russians – and unless the state is structured in such a way that that freedom is protected and enhanced, the human potential will not be realized – at least to the extent expected

21. So, here is the Medvedev challenge:
It is impossible to deal with the socioeconomic problems without reforming the state
No effectiveness without accountability
No accountability without rule of law
No rule of law without electoral democracy

22. Medvedev: need for rule of law, freedom, democracy
Signs of a new trend
What are the implications?
A respite: 4 years without federal elections
The issues: courts, media, political rights
On these issues, there can be liberalization

23. Will Medvedev turn to the people for support?
But:
Regional elections
The Enforcers’ influence
The military-industrial complex
Will Medvedev turn to the people for support?
Will he try to wake them up?
Unlikely, but you never know
Bottomline: Political struggles are bound to become more open and intense, it is only natural
It is an open question who will win
Liberals are vulnerable
Enforcers may appeal to the people, too
Their backup option: Fortress Russia

24. Dual power Russian precedents 20th century 18th century 17th century
Yeltsin: 1993
Gorbachev-Yeltsin:
Brezhnev-Kosygin:
1917
18th century
Empress Catherine and Emperor Peter III
Empress Anna and Supreme Council
17th century
Peter I and Princess Sofia
Time of Troubles

25. Always ended in one side winning
BUT: all these incidents of dual power occurred in Times of Trouble
Situations of state collapse, sometimes triggering off a civil war
Today – it is very different

26. Was the real meaning of the power shift in Moscow?
A desacralization of power?
The Tsar is replaceable, if the people confirm it?
And the state does not collapse?
Such a pattern of political change does respond to the pluralistic nature of Russian society – and does open a path toward a stable democracy
The Kremlin plan
First, economic recovery with political stability
Then, the rise of the middle class
Then, a full-fledged liberal democracy

27. This is the plan, and the self-interests of the ruling class are obvious there
But Russia’s path to democracy is going to be much less smooth than this plan envisions
Initially: a determination to work together
But struggles are inevitable
Different interests, different priorities, different groups
3 main scenarios:
1/Med. gains power, Putin gradually exits
2/Med. acts as a figurehead, Putin comes back in 2012
3/Real dual power stimulating pluralism, institutionalization, transition to democracy

28. Putin’s greatest achievement is recentralization of state authority – almost an elected monarchy
And this recentralization also poses the greatest dangers to Russia’s modernization and Russia’s democratic future
Now, this monarchy is being dismantled through a process of bifurcation
The motives are many and complex
But it was a conscious decision
Russian historian Dmitry Furman: it is the first fork in the road since 1991

29. In 1991, there was something like a democratic revolution – and democracy began to suffer almost immediately afterwards
The leaders of the new Russian state, which emerged from the ruins of the USSR,
Wanted capitalism more than democracy
They were mortally unsure of their ability to keep power while they plundered the public assets of the Soviet state
Democracy worked for them to the extent that it enabled them to dismantle the Soviet system
But it quickly became a threat

30. Now they are more confident
And they are showing new interest in pluralism, rule of law, the value of freedom
Without a doubt, they will try to be very cautious with all these democratic ideas – but whether they’ll manage to maintain control is open to great doubt
Still, for the moment, Moscow has proclaimed a Russian Evolution
During the Victory Day Parade on May 9, 2008, the Lenin Mausoleum was hidden from public sight – it had never happened before

31. I am sure Lenin’s ghost felt comfortable with this decision
Lenin actually wanted to be buried in a normal cemetery
But Stalin needed his embalmed mummy as a sacred object of worship
From 1953 to 1961, the two of them were lying side by side
In 1961, Stalin was kicked out and buried nearby
Now Lenin’s mummy has become an oddity – it does not fit
Russia has abandoned communist ideology
And it is celebrating its millennial traditions which Lenin waged war against
The leader of the Russian Revolution is consigned to history
But the idea of burying Lenin remains just that – an idea
Fear that once you remove him from the sacred place, the demon of the Russian Revolution will be unleashed

32. The US election will have a great impact
The West’s role
The US election will have a great impact
The Canadian election - unlikely
US challenge, as perceived by Moscow:
Military power, NATO
Democracy promotion
What Russia can respond with:
Energy diplomacy
Geopolitical maneouvers

33. Public opinion, US and Russia
..\Arms control\Steinbruner on US-Russia perceptions.doc