The Psychology of Loose Wheels

As the Russian economy tanks, the wheels are starting to come off Vladimir Putin’s regime.

How annoyed would you feel if you had to make an utter fool of yourself, day after day, for benefits that are gradually decreasing? Probably about as annoyed as Sergei Lavrov, the Russian minister of foreign affairs, did when he recently mumbled expletives into his microphone in the middle of a press conference. Little does it matter if the text that caused Lavrov’s outrage came from an assistant, a family member or Vladimir Putin himself. The head of a country’s diplomatic corps is not supposed to lose it like this.

Or take Vladimir Yakunin, a Putin confidant and former head of Russian Railways who unexpectedly resigned last week to become the representative of Kaliningrad in the Russian parliament’s upper house, the Federation Council, a position that comes with a lot less influence and money. Was he the victim of a struggle inside the elite? Was he replaced, as Leonid Bershidsky suggested, because desperate times call for efficient managers rather than kleptocrats? Has he taken a different career direction?

Again, this is not what really matters. What matters is that visibly, the power engine of the Putin era — material benefits in exchange for unwavering political loyalty — is failing. And not only inside Russia.

In the past week, Russian journalists, bloggers and Russia watchers have been trying to make sense of the abrupt resignation of Vladimir Yakunin. Some suggested that even with the enormous benefits and political clout that Yakunin enjoyed as the head of Russian Railways, it was simply too risky for him to stay in his position. His friend, Ugis Magonis, the head of Latvian Railways was recently arrested on corruption charges. But this is the kind of scandal that an official of Yakunin’s stature would certainly shrug off. It would be harder to do that with scandals such as the cancelation of suburban train services in Russian regions, which led to local protests at the beginning of this year and drew Vladimir Putin’s ire. Did it take Putin more than six months to finally approve the dismissal of one of his closest allies who shared a dacha collective with him?

Some said that the problem had become systemic and, as money is on low supply in Russia nowadays, we can expect more such dismissals: efficient managers replacing Putin’s cronies to fill the holes on state-owned firms. Some have to make money for others to spend or steal and the energy industry has been visibly struggling.

Or maybe Putin does not have to do anything with Yakunin’s exit at all. Perhaps Yakunin was tired after ten years at the helm of Russian Railways and left the company to enjoy his fortune. After all, as the governor of Kaliningrad pointed out, he had gotten his status as an envoy, necessary to be a representative of Kaliningrad of the Federation Council, already in 2014.

Certainly, this does not sound very plausible. Neither do theories that claim Yakunin was aiming at a political career by taking up a seat in the Federation Council. Yakunin had a political career already, as the head of the Russian Railways. His seeking parliamentary immunity sounds only slightly more of a realistic explanation.

Still, despite the implausibility, talk about Yakunin’s impending political career are so persistent that there may be something behind it. It seems unlikely that Yakunin would be groomed as a successor to Putin but it comes up frequently in the Russian press. What if Yakunin has to appear as Putin’s “likely” successor because power groups in the Russian elite have already someone else in mind?

All of these explanations are plausible, some more so than the rest. We cannot know for sure, until the head of another state-owned giant is dismissed, whether Putin needs efficient managers. We cannot know whether Yakunin is a stand-in for a presidential candidate until pro-Kremlin media starts to portray him as such. We cannot know if he is a victim of a power fight within the elite that Putin could not control.

However, neither explanation bodes well for Putin. They all show weakness, in different forms. People getting frustrated on different levels of the power vertical. Uneasy decisions on scarce money costing key people their jobs. Corruption scandals getting to the higher echelons of the Russian elite. Power struggles slipping out of control. Vladimir Putin may, as Ivan Krastev suggested, not participate in day-to-day decisionmaking any more, but — check the polls if you don’t believe me — he is the only politician in the country. He is there alone to reap the benefits or to suffer the blows.

Near abroad getting further

And now these blows come from the outside too. The president of Belarus, Alexander Lukashenko freed political prisoners last week. Barring the possibility that Europe’s last dictator really means to turn into a democrat this time, Lukashenko is soliciting more money. Not from the IMF or the European Union but from the only place that he could possibly get it before elections in October: Russia. Russia has already given $760 million to Belarus but Lukashenko is unimpressed: he wants as much as $3 billion. The Belarusian president knows that an increasingly paranoid Russia can be blackmailed with Belarus’ mending fences with the European Union.

And it is not only Lukashenko: When in June, protesters took to the streets in Yerevan over a hike in the price of electricity prompted by endemic corruption in the Russian-owned power company, the Armenian president, Serzh Sargsyan, decided to demand economic and political concessions from Russia before breaking up the protests.

Presently, Russia is able to placate loyal elites in its neighborhood but this is visibly becoming harder. Soon it will find its two other aces in the game of integrations — jobs for guest workers and markets for substandard exports — similarly difficult to use in the face of rapidly growing nationalism and poverty. There will be more blackmails and more side glances to China or the European Union. In short: more signs of the weakness of Russia and the only politician in it, Vladimir Putin.

Bad decisions and indecision

Sanctions accelerated Russia’s crisis. But they were the best thing that could have happened to Putin. The Russian president has been wallowing in the sanctions because they gave him an excuse. They gave him a Potemkin wall to pretend that without the sanctions Russia would flourish. That it is not losing in the global energy game. That it would have a functioning economy had it not been for the West. They gave Putin an opportunity for an experiment to transform Russia into a besieged fortress.

But the experiment is failing.

Even in a besieged fortress, politics has to prioritize. And when money is on short supply, priorities matter more. Putin may have succeeded in changing the narrative but he has not changed the system. A flawed polity will produce bad decisions. It will produce, as Valery Solovei pointed out, unnecessary, lavish pavement works in Moscow while people get laid off. And it will produce more of such and on a larger scale. No cadre replacements can stop this inertia.

The little pieces coming off the machine reflect a growing frustration with the state of affairs in Russia. And while there is a growing fear of the unknown in the West, this fear is gradually receding in the post-Soviet elite. The West needs a better strategy.

This story first appeared at No Yardstick, August 29, 2015.