Monday, March 05, 2012

A Disgruntled Middle Class May Cause Putin's Fall

For Putin's inability to deliver on his promises sows the seeds to the civil society thay may cause his downfall. It does not suffice anymore to throw out bones to the middle class.

Yesterday, Russia headed to the polls with no real choice. The winner was predetermined. Putin moves in to the Kremlin again, this time with a six year mandate and an option for another presidential term until 2024. A quarter of a century with Putin however appears increasingly unthinkable. The reason is not popular protest, but because Putin's policy is passé. The soviet structural legacy has caught up with Russia and plans to solve problems turned into idle talk. Russians want what Putin cannot do. Instead, people choose their own solutions. Personal interest is turned into societal interest, and the seeds of civil society are sown. 

Largely, Russian challenges reflect western, in terms of an aging population, deficient infrastructure, environmental problems, health and education, but on a much deeper level. Consequences of decades of lacking investment become all the more intrusive into Russian everyday life. Politics turns into an arena of what one must do, and not what one wants. When what one must is not possible, power turns irrelevant for the citizens.

Few things in Russian societal discourse has been discussed with such obsession in recent years as all the plana that necessarily must be realized to meet the challenges of the future. Plan succeeds plan, but results are lacking and the country is sliding deeper and deeper into stagnation. Plans have made politics a prisoner of its own rhetorics, and reality has overtaken Putin in his zeal to catch up. The result is threading on in the same old tracks until running in circles. In practise, there has been a single political priority - stability - that has crowded out all plans for change. Putin's political stability thus paradoxically leads to the opposite - political instability. 

Some events define a regime regardless of whether perceptions are real or not. For Putin, it was terrorism and coloured revolutions. Thus, the play of circumstances set preconditions for an entire political era. Thus, a pathological obsession with internal and external enemies has turned Russian politics insane. Thus, fears of a flawed perception of reality arise. Because when threat turns into norm, the desire for normality rises. The western threat appears as paranoia. Terror becomes all the more tragic when authorities fail - as in Beslan and at the Dubrovka theatre - to deal with it, with an increasing sense of powerlessness as a result. The power of habit is great and the mantra of threat makes realities unreal when rhetorics turn danger into myth. Everyday threats become more real than those of the world, when causes of accident, unhealth, and insecurity are found in the inactivity of a state that self-centredly reflects itself in its own greatness instead of creating a better society for its citizens. 

Because it is a state that grows and grows but is capable to do less and less. When urgency is growing, it is not the state that puts down the fire. This realization grew during the great wildfires that ravaged central Russia during summer 2010. The state not only stood idly by faced by catastrophe, but withheld information that in too many cases could determine life or death to the public. The silence from authorities in connection to major accidents and disasters previously experienced now assumed massive proportions. However, people refused to passively stand by and watch their homes burn to the ground, and instead voluntarily joined together to fight approaching danger, e.g. with the use of social media. Information about the fires was gathered, fire-fighting coordinated and fighting equipment purchased - all on the initiative of ordinary people. The inactivity and incapability of the state forced people to voluntarily help each other. Society turned out to be greater than the state. 

The 2010 fires have ignited a flame that glows brighter and brighter in Russian sosciety by various big and small efforts. Many small and inconspicuous initiatives have been made previously. It may e.g. be policemen and security servants, who informally try to fight corruption and flaws within their own professions. It may be motorists, who inform each other about the corruption of traffic-police. Examples are growing in numbers, and so far it is more a matter about disclosing than fix the flaws and failures of society. What is decisive is that this type of citizen initiatives are not fundamentally political, or at least not perceived as such by participants and surroundings. You simply wants to solve the concrete problems that sorrounds you in everyday life. However, the effect is political in a way are difficult to master by state and authorities, because how does one accuse peole who merely want to improve their country. Many are patriots and honest people. Many also support Putin and his regime.

Here, the Internet has become both a tool to find likeminded people and to build platforms for information and action. It is this type of ideas and initiatives that the famous oppositional blogger Navalny has collected and built his fame on. Thereby, he has made the apolitical political, and turned apathy into sympathy for a spontaneous movement, first with the aim to achieve free and just elections, and then to depose of Putin. The same type of Internet platforms that previously were used to report fires are now used to coordinate voluntary election observation and to report irregularities and fraud at the ballots of Sunday's presidential elections. 

This is a development, which is hard to curb. To crack down on the opposition in the aftermath of elections is one thing. To crack down on those who only wants to do good is a completely different matter. As logics and mechanisms of citizen initiatives are the same, it is next to impossible for the regime to distinguish friend from foe. Already the protests planned for Monday may put the loyalty of police and security service to its test. Opposition demonstrations have gradually turned into festivals. To meet people with violence and brutality is something one for good reason hesitates to do, and it is probably seen as a last way out, both because of the message it would send and for fear of losing control over developments. Even if the opposition gathers masses in the tens or hundreds of thousands, demonstrations only affects relatively few. Many simply do not understand or care what it is all about.

Sunday's elections may not change Russia on the surface, but at its dephts it is a society that gradually is changing at its core. We are witnessing the growth of Russian civil society. Its significance should not be exaggerated, but neither should it be underestimated as both the plan and the rules of the game are changing. The discontent of a growing middle class must be taken seriously and the forms and contents of politics change when people organize. It does not suffice to throw bones around every now and then. Citizens want to sit at the tables of power in a way Russian politics do not understand. It is a question of power over everyday life, about close and concrete problems. Who is in the Kremlin is less important, but power must understand that the needs of the people must be reckoned with. The people deserves to be taken seriously and the needs of society cannot constantly come last in turn. 

Are we then witnessing the end of the Putin era? The truth is that there are no good answers. Still, the Kremlin's communicative disaster in relation to a discontent and protesting middle class cannot go on, as it is now increasingly assuming the forms of political schizophrenia. The middle class mania of power is a constant theme of societal discourse. Now, the middle class is regarded as preservers of society and a self-interested guarantee for continued stability. Now, it is seen as movers of society and a source of Russian reform policies. Now, it is portrayed as subverters of society and traitors, when it demonstratively makes reasonable and righteous demands on politics. At length, the effect is that power turns the middle class away from itself, adds to uncertainty and insecurity, and makes the unthinkable thinkable - a Russia without Putin. Because the more the Kremlin fear propaganda adds to the image that Putin is the only alternative to chaos, crisis, and war, the less serious and credible will he appear as a politician. Propaganda risks turning into a self-fulfilling prophecy, and the personalization of Putin into an icon of a Russia in decay.

The rifts in Putin's coulisses grow and it becomes increasingly difficult just to patch up. Through the growing holes nothing and no-one is seen. The future scenery is dark and gloomy, against a towering warfare backdrop. Many also remember how Putin once sprung out of nothing onto the scene to play the lead role in more than a decade's Russian politics. A new cast for the play may by extension not be excluded, even if it is improbable that the curtain will drop for Putin. Still, it is a changed country that now emerges. We may not trust Russia, but does that mean that we do not trust the Russians when people now rely on their own abilities instead of state stagnation. When Russians are not given any choice, they make their own choices.

Thursday, March 01, 2012

State is Greatest Enemy to Russian Economy

For Veckans Affärer: In 2010, business paper Euromoney Magazine awarded Russia's Alexei Kudrin finance minister of the year in the world. Less than a year later, he was sacked by president Medvedev and joined a fragmented Russian opposition. This is just one example of how state and politics become Russian economy's greatest enemies. Growing political unrest in the runup to Sunday's presidential elections emanates from middle class discontent with failing governance, corruption, and political parasitism. "Stability, stagnation, and then what?" is what an increasing number of Russians ask themselves. Uncertainty about the future has suddenly increased the political risks with Russian economy.

Russian economy is in good shape. With a budget in balance, one of the lowest state debts among major countries, just over 4% growth and 5% inflation in 2011, the country's prospects seem bright. Threats are the usual: Falling oil prices and turbulence in the financial markets. Despite positive signs, we now see a lapse in recent years' dynamic developments. A temporary "wait and see" in the runup to Sunday's elections may lead to a more permanent economic slow-down because of political inability to cater for long-term economic needs.

January witnessed the greatest financial outflow from Russia since the 2008-2009 financial crisis. Growth was at zero and inflation is expected to rise during 2012. Where political analysts are silent, the market speaks out clearly. Trust in state and politics plummets, as the failed December parliamentary elections have dislodged the power and interest balance within United Russia - the country's ruling politico-economic cartel.

Even if fears prove exaggerated, it will take much time before the system reaches equilibrium again. The effects of prominent politicians' resignations become increasingly clear. Above all, Kudrin's sound financial policy has been replaced by overbid policies and pork-barrelling. Increased state expenditures is like throwing money into a black hole, believing it is a wishing-well. The flow of money instead runs from the oil wells, where energy constitutes a third of state income. Outside the energy sector, only middle class consumption drives the economy.

Putinism's political strategy - to promote the middle class in exchange for power - has failed. Instead, they have to bear the burden of a bureaucracy, which has grown by 40% since 2000. State efficiency has constantly fallen since 2003, with a corruption that affects everyday life of an increasing number of Russians. Only during 2011, the level of bribes tripled, accordning to the Interior Ministry. Bureaucracy and corruption are poisoning the flexible and dynamic business climate, where everything was forbidden, but everything also possible. Opportunities have decreased and hopes for the future changed to skepticism and discontent. Recent popular protests have thus greater depth than ordinary political opposition, as the state obstructs basic preconditions to earn money and make a decent living.

Except for the country's dependence on oil prices, Russian society is confronting fundamental structural challenges, which demand an increase in economic diversity. Declining demography reduces the number of Russians of productive age. Mounting flaws in infrastructure, health, environment, and education threaten to shrink productivity. Politics has not only failed to address these flaws. It has also reduced the economic incentives of the middle classes to contribute to diversification. 

What worries most, is the increase in political polarization that Putin now propels. The protesting middle class, with reasonable demands on those in power, is portrayed as traitors. This is a dangerous message and illustrates a contempt for those, who until recently were seen as Russia's future. As derision turns into threats against protesters, Putin alienates and provokes the very groups that have greatest potential to contribute to the country's further development and shows that material more than human resources are seen as the source of Russian growth. The economy may be sound, but as long as political malaise is spreading in the social body, risks will grow for Russian economy as people now have had enough of Putin.