At Large
Putin’s New Year Tests
If not for problems at every turn he’d have nothing.
It’s not easy these days to be Vladimir Vladimirovich Putin. Everywhere he turns — economically, politically and militarily — he, and Russia, has problems.
Putin has tried to make the best of a bad deal. The head of Russia’s strategic missile forces announced that they would suspend the development of certain, unnamed, strategic weapons if the U.S. plan to deploy an anti-missile system in Europe, initially in Poland and the Czech Republic, were similarly halted.
In reality the Russians have already cut back expenditures on strategic weaponry as part of the defense portion of national belt tightening currently under way. Prime Minister Putin’s statement that there would be no reduction in defense spending is regarded by most observers as merely rhetorical cover fire.
Defense Minister Anatoly Serdyukov has instituted a serious reshuffling that reportedly alters the General Staff control of the army so as to make it more responsive to the civilian leadership. The deputy minister of defense, General Vladimir Isakov, who is also in charge of the logistical command, has been pushed out. Similarly removed were said to be the head of military intelligence and the commanding officer of the Central Command Center District. In turn their staffs and other commands have been hit by large numbers of unexplained retirements, an old Red Army device for “sterilizing” the general officer ranks.
Russia’s current economic instability derives in great part from the precipitous drop in oil and gas prices along with trade losses in commodity exports, all due to the global financial crisis and industrial development cutbacks. During the eight years of his presidency Putin was favored with a seemingly unstoppable national economic growth.
The bottom is now falling out of the Russian economy, leaving Putin spinning first in denial and afterward blaming the United States. Analysts from the Russian financial concerns and government offices have been instructed to play down negative findings at pain of losing their jobs.
The Russian industrial figures in November showed a 10.8% drop from October and an overall fall of 8.7% on the year. Expectation of a devaluation of the ruble is a parallel development of the continued descent of oil prices. At current price levels of oil well below $40 per barrel, and falling, there is a real danger that concomitant fall of investment in oil development will only feed the decline in the overall economy.
Meanwhile there are signs that the Russian working public is exercising its political muscle by staging demonstrations against punitive increases in duties that raise the cost of imported goods in general and new and used automobiles by 50 percent. Rallies were held in thirty cities across the country and riot police beat back protesters with their clubs in Vladivostok.
Unused to this form of public reaction, Putin spoke out openly in condemnation of the public protests, fearing the potential of growing social unrest. He was obviously alarmed that the public reaction would expand exponentially in these volatile times.
Moscow is putting pressure on its near neighbor, Ukraine, prior to the annual January gas contract deadline. The issue as usual is money — $2.4 billion is said to be owed by Ukraine to the Russian energy giant, Gazprom. The matter has become politicized beyond the strict Russia/Ukraine disagreements by Russian criticism of the European Union.
Russian official sources have been quoted as saying the EU seems more interested in bringing Ukraine into NATO than helping economically. The fact that Europe receives approximately 25% of its Russian-sourced gas through Ukraine’s pipelines is a major point of Russian leverage. In these parlous financial days, however, it is leverage that is self-defeating.
As the financial crisis deadens the exuberance of Putin’s leadership, there also has been an increase in dissension between the military/security factions on one side and the economic/business elements on the other. Each is pushing for ascendancy in the Putin-Medvedev bipolar leadership system. There may be no real division between the two men personally, but among the political classes there is a constant effort to test any nascent differences.
For Vladimir Putin’s part the forthcoming year carries severe tests. He was very unhappy with command and control during the Georgia conflict. This has been one of the reasons for the military shuffle. The economic crisis is well beyond his ken and he is counting on Medvedev to keep in line the politically liberal but fiscally conservative finance minister, Aleksei Kudrin.
In strict political terms Putin must rule Russia for the first time with a diminishing economic hand. He is unable to reward his favored supporters with the economically related political favors of the past.
The question exists for the forthcoming Obama administration whether an economically weakened Russia is more or less of a danger.
About the Author
George H. Wittman writes a weekly column on international affairs for The American Spectator online. He was the founding chairman of the National Institute for Public Policy.
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Jon| 12.30.08 @ 12:07PM
"The bottom is now falling out of the Russian economy"
That's quite an exaggeration.
Russia's economy is still projected to average over 2% growth next year, with the rate increasing in the second half. Granted, that's a steep decline from the 7% average growth of 2000-2008, but it's still growth, amidst a global recession. We'd be happy to take 2% growth here in the US.
Martin Webb.| 12.30.08 @ 1:51PM
The American economy don't exist, America is economically dead.
What can America sell to the rest of the world except doom and gloom?.
America does not even have good advice, the Americans, and Israel are one. Two parasitic countries living of each other. The trouble is the biggest fools are the Americans, Israel is bleeding America dry, and like they stole the Palestinian land, they are slowly stealing all of America, by the time the Yanks wake up they have no land or country.
Sue| 12.30.08 @ 1:57PM
People who want cars, why would they buy unreliable vehicles, when they can get good reliable Japanese cars.
Stan Redmond| 12.30.08 @ 4:55PM
Russia is doomed to failure. Brain drain, alcoholsim, and negative population growth are not good indicators for a country's viability. If it weren't for oil Russia would be nothing more then a cold wasteland.
And poor poor Martin Webb. John Edwards did say there are two Americas. It must be awful living in the America full of miserable pessimists, life's losers, and unhappy people. You're so gloomy and miserable you don't even find solace at the alter of Obama. You should try visiting us in the optimistic part of America. The view is much better.
VinceP1974| 12.30.08 @ 10:24PM
What can America sell to the rest of the world except doom and gloom?.
Rush Limbaugh used to say the best way we can get an advnatage over our enemas is to sel them our Lefties.
I have to wonder what enemies leaders say amongst themselves when they watch our Left in action.
VinceP1974| 12.30.08 @ 10:32PM
Martin Webb: Can you name me all the great men in the past, persons like yourself, who cry in utter despair because the people who want to destroy you and your way of life are losing in their war against another party?
And how is it that you fail to detect that the Arabs/Muslims of the Middle East are the true parasites. Name me something that the Arabs of that area produce for the world ?
How do you justify supporting a group of people raising their childern to be zombie suicide killers? How do you support people who are training their kids to kill you?
ruth| 12.31.08 @ 12:00AM
Martin Webb, "the American economy DON'T exist." Arrgghhh, the horror of the American Public School System; Liberalism at work.
Michael| 12.31.08 @ 7:49AM
Putin is eating his own produce, i.e. SHIT! For 8 years in power he has done nothing apart from becoming one of the reachest men in Europe. It appears that he along with his KGB colleages cofused high oil prices with the talant and wisdom of a mature governor. Corruption, cleptocracy, lies and total distruction - this is just a few features that he and his team have brought to Russia. At first they scared off foreign investors now they are trying to suppress their own people. The fact that he and hie buddies are scared by the people's protest just confirms that he is a wrongdoer. If Putin and his team will receive a condemnation and total hatred that won't be surprizing at all. The time is ticking out. As to the statistical data on the Russian economy, I wonder who believes such distorted numbers?
Peter| 12.31.08 @ 3:34PM
Happy New Year to all of you along with Mr. Wittman, living in Stan Redmond's prosperous, blooming and well respected all around the world America.
gazinya| 1.1.09 @ 7:19PM
Mr. Webb. I'm suprised that you can still send comments from the West Bank. I guess there is still some work that needs to be done.
dubya| 1.2.09 @ 5:40AM
The Neocons are getting desperate: the US economy is in the toilet; people are waking up to Bush/Cheney/Rice criminality in 911 and the invasion/occupation of Iraq. These sociopathic/luciferian/pedophilic/secret-society little men need to distract the world from their evil. And what better way than to start up a new cold-war with Russia?
First, surround Russia with missiles batteries and then provoke the Russians by slaughtering hundreds of innocent and unarmed Russian civilians. But it didn't quite work the way they planned (as nothing else does). Russia came in, kicked the Israeli and US back Georgians out; and now the neocons have the fucking nerve to state that countries don't invade other countries in the 21st century???
FUCK the JEWS| 1.3.09 @ 12:00AM
DUBYA.
I have to give it to yeah, you are my kind of person say it as it is. And I say FUCK em all. What did Iraq do to Americans 1.2 Million of them are dead. And 3 Million displaced as refugees.
The fuckers tried it with RUSSIA and thought they could Arm the GEORGIAN to piss with the Russians and had to beg for help. Them JEWS are going to get theirs soon.
Oleg| 1.3.09 @ 8:22PM
George,
What do you mean writing "Russia is more or less of a danger"? Are you a great believer that Russia is invading US soon? Or drunk russian generals misleadingly will bomb GA instead of Caucasians neighbor? It would be very valuable information if you reasonably informed us about ugly russian secret plans to pose a "danger" to you.