Unforeseen Contingencies

Imagine the following: you unexpectedly become head of a country that used to be the center of an empire. This empire was once considered one of the greatest powers in the world, but it collapsed and broke apart owing to internal contradictions in its economic and political system. The collapse means that the country you've inherited is considered practically a third world country instead of a superpower. What do you do?

This describes, of course, post-Soviet Russia and Putin's position in it. Putin found himself confronted with rampant corruption, declining national security from real internal threats (Chechnya) and potential external threats (the loss of buffer states such as Ukraine, Georgia, and the like), and a poorly functioning economy. These are all terrible problems -- all demanded attention. Unfortunately, Putin has largely gone in the wrong direction.

Putin's first reaction has been to centralize power -- after all, it's a weak central apparatus that permits corruption to thrive and security threats to grow, isn't it? And this is Russia's heritage -- concentrating power in the hands of a central leader was first the Tsarist and then Soviet way. All of Russia's most successful moments featured a powerful central authority. This is something Putin understands well. The problem -- Putin's problem -- is that what he understands isn't the thing that will solve Russia's actual problems:

Corruption -- this is, I think, the greatest single problem facing Russia -- and Putin's response has been to centralize power -- after all, how else to crack down on public and private corruption? But Putin's confusion is that it isn't a powerful state, or leader, that's needed, but a strong state whose power is properly limited. The powerful state has authority in far too many spheres, while the strong state successfully enforces the rules in the spheres where it has influence. Putin's record is one of expanding the power of the state, rather than its (properly limited) strength.

National security -- the Russian and Soviet experience is that the first line of defense must be buffer states. From this standpoint, which Putin understands well, his presidency must look like an utter disaster, given the stationing of American troops in Central Asia, and the moves westward by Ukraine and Georgia. But this is only a disaster if relations with other big powers are seen as a zero sum game, or if "buffer state" means vassal state. There's little reason why Russia inherently is threatened by Ukrainian and Georgian independence, or perhaps even by NATO expansion to those states. But it is fears of Russian domination that pushes these countries towards NATO, and (presumably) also causes the West to have second thoughts about Russia as a "member of the club." Putin's grabbing hand reaction is understandable, given his KGB education...but it's a terrible mistake for Russia.

Economy -- since 1999 the Russian economy has grown at 7% per year -- an excellent macro performance. High energy prices a big part of the story, but Putin is, in part, responsible. The climate for business in Russia is better now than it was when Putin took office. Unfortunately, the base Putin is building for business isn't at all secure -- whenever the state (presumably Putin) decides, property rights are redefined to suit...hence the recent allegations of "environmental problems" in Sakhalin oil concessions, in which Western invesors are finding their contracts are about to be redefined...or the seizing of Yukos and destruction of Khodorkovsky. Relying on high energy and raw materials prices isn't the road to long run growth -- securing property rights so as to generate increased innovation is.

There's lots more to be said, but the bottom line -- Putin's attempts to rebuild Russia smack more of Mercantilism and Tsarism than anything else. This is a disaster for the world, because Russia is an important country, but even more so this is a disaster for Russia. There's no real reason -- other than bad institutions -- that Russia shouldn't be among the most successful countries in the world. So all real Russian patriots (such as the handsome young guy pictured above) realize that Putin's problem -- his failure to be able to see the world outside the lense of his KGB/security training -- makes him Russia's problem.