Russia-2025: Scenarios for the Future

Russia-2025: Scenarios for theFutureFebruary 2013Nikolay Petrov , HSE

Basics of OMDSubstitutions in Putin’s Russia2012 (8) - The Council of lawmakers; Putin’s strategic cabinet at theKremlin with his former key ministers, presidential Commission onfuel, energy, and environment, Ministry/ corporation on the FarEast; electronic voting (Presidential council on civil society);municipal filters at gubernatorial elections; Center to promotelawmaking at ISEPI; ombudsmen on entrepreneurs’ affairs.Dynamics of major substitutes’ emergence2233 3681999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20122011 (6) – All-Russian Popular Front; Strategy-2020 expert group and the Institute of Socio-Economicand Political Studies (ISEPI); the United Russia primaries; investment ombudsmen; the Agency forStrategic Initiatives; the “Broad Government”.

Institutions-substitutionsFive weakened democratic institutions and theirsubstitutions in Russia at the federal levelState DumaPublic ChamberFederation CouncilConsultative councils, commissions attached topresidentState Council and its PresidiumCouncil of LegislatorsPolitical partiesIndependent mediaGovernment‘Loyal opposition’ parties and movementsState corporationsRegional political machinesPublic reception officesRegional networks for collecting letters from citizensFSB, other secret servicesPollstersPresidential administrationState corporationsSecurity CouncilElite ‘clubs’

Institutions-substitutionsThree weakened democratic institutions and theirsubstitutions in Russia at the regional levelFederal andregional bodies ofexecutive powerPopularly electedheads of regionsand ofmunicipalitiesDirect electionsPlenipotentiary presidential envoys to federaldistricts; chief federal inspectorsPresidential appointees confirmed by regionalparliaments and hired city-managersHorizontal rotation of federal appointees includinggovernors; complicated system of indicators usedto evaluate efficiency of regional authorities; socalled ‘personnel reserve’ at different levels; secretsociological polls to evaluate public attitudes;

Basics of OMDBasics of the Overmanaged Democracy regime1. Putin’s OMD = strong presidentialism unrestricted by other institutions + controlledmedia + controlled elections.2. Replacement of institutions by substitutions3.Non-flexibility and lack of drivers.4.Declining OMD efficiency and growing dependence from oil dollars.5.Simplistic solutions for complex problems.6.Dismantling of “failsafe” mechanisms7.OMD in elections: win-win game for the Kremlin.8.Declining role of elective offices.9.Action-reaction model in elections10.Internal elites contradiction in an electoral OMD11.Need for modernization.

OMD-limitsGrowing dysfunctionality• Priority of control and loyalty over efficiency,• short time horizon,• narrow visionCases:1 Putin’s first, second and third terms2 Governors’ replacements and the party of power failure in 2011 Dumaelections3. Impotent omnipotence

OMD-limitsSystem’s mechanical character, lack of flexibility andadjustabilityHigh center of gravity - instabilityLack of buffers, leading to shocks beingtransmitted to the very topInability to grew organically and to adjustLocal political crisis can easily transforminto all-Russian one posing risk to thewhole system

OMD-limitsWeak feedback• Weak political parties and the parliament• Strong state control over major media• Regional interests are almost not represented at thefederal center• It takes too long for a signal to go to the very topthrough various filters and to come back

OMD-limitsTroubles with decision-making• Absence of formal formats to represent interests of major elite clans and tofind a compromise• bilateral rather than multilateral communication,• matter of time,• tactical rather than strategic,• no way to make a logical chain of election/ reformsNone of serious decisions where interests of differentelite groups overlap has been made recently once andforeverPension reform; political reform – 2011;Cases: Rosneftegaz…

PoliticsRussia’s political system under Putin: diagnosisIt’s not just imitating something, it works.The problem is that it’s static, it can’t reproduce itself whichmakes its lifetime very limited.Putin’s system during12 years has emerged, matured, agedand is now at the stage of decayPutin’s problem is not his stupidity or even secret servicesbackground, it’s lack of restrictions. He used to be muchmore effective during his first term when having seriousrestrictions, then everything got wrong and unfortunately forhim and the country oil prices skyrocketed…

Politics2012 emasculated political reformEven the most truncated of Kremlin’s recent political reforms have begun tofalter. The Kremlin has decided to slow the pace of reform now that thepresidential election is over and the protests have quieted down. Parties. Loosening the procedure for registering political parties – done Direct gubernatorial elections – restored, although a) there are twofilters; and b) the Kremlin avoids elections The new scheme of the Duma election worse than existing one - waits forthe second reading The new scheme of the Federation Council formation – draft sent to theDumaAmendments to the law onmeetings – tightening the screwsDecorative reforms and bottlenecks

From the „federation of corporations“ back to the “federation of regions”Center-regions relationship in 2000s, dynamicsRegionsThe CenterUnited Russia bad results atthe Duma elections2000Federal reform: federaldistricts, new scheme of theFederation Councilformation, State councilDeregionalization of the FederationCouncilRestoration of horizontal rotations offederal officials (struggle for MVD)The weakening of the fiscal federalismTermination of bilateral agreementswith the regions2005‘Beslan’ package: switch toappointing governors, newsystem of the State DumaelectionsThe unification of the forms ofpolitical organization in regions2011RegionsRegions enlargementExpanding of the practice ofappointing governors –“varangians”Reform of the localgovernment and thedismantling of mayoralelectionsReturn to direct elections ofgovernors;Establishment of the Ministry for theFar East development;New system ofthe Federation Council formationThe State Council 07/17/12‘+’ UnitedRussiaprimaries;Kozak’s andKhloponin’sworking groups2012‘-’ The law onhorizontalrotation of federalofficials inregions, largescale rotation inthe InteriorMinistry

Russia on the moveA short, victorious war against corruption?Anti-corruption crescendo:• Oboronservis + (2010) (Serdyukov) > 6.7 billion RUR;• Russian Space Systems/ GLONASS (2009-2010) (Ivanov) > 6.5 billion RUR;• APEC summit in Vladivostok and Minregionrazvitiya (Shuvalov) 2008-2012– 93 million RUR;• Minzdravsocrazvitiya 2011 – 250 million RUR;• Minenergo 2011-2012 – 90 million RUR;• ‘Stankoimport’ 2004 – 2.5 billion RUR;• System utilities in St. Petersburg 2011 – 3 billion RUR;,• Rosagrolizing 2007-2009 (Skrynnik) – 39 billion RUR;• Rostelecom 2011 - 100 million RUR

Russia on the moveA short, victorious war against corruption?What for?Well prepared campaign with media supportAnatoly Serdyukov as a sacrificial lambSocial-Darwinism in practiceGoals: to demoralize and consolidate the elites in order to let Putin more room formaneuver; to raise Putin’s legitimacy in the eyes of ordinary Russians; to feed new‘hungry’ elites.Just to increase Putin’s control over bureaucracyRussia in 2012 Transparency International rating

Russia-2025Scenarios for the futureOptimistic scenario - Modernization from above : Putin - modernizer.Putin starts reforming the system to minimize risks of transfer of power.Political liberalization and institutional reforms.Pessimistic scenario - Modernization from below : Putin – Shmutin.Vicious circle of phases ‘Order, Putin’s style’ – ‘Democracy, Yeltsin’s style’without strengthening institutions.Realistic scenario - reactive Modernization : neither Putin nor anotherPutin. Business-political elites understand that Putin is an obstacle ratherthan an asset and start his replacement. The only way is to share hispower, which needs strengthening institutions.

Russia-2025Elections as a model of transformation• Set of the party of power failures in local elections• Avalanche of gubernatorial elections contrary to theKremlin’s plans, increase of governors’ loyalty toregional citizenry•‘Regionalization’ of the Council of Federation and earlyDuma elections• Yaroslavl ‘success story’: victory of an opposition atregional assembly reelection (2013) – dismissal ofappointed governor – opposition candidate winsgubernatorial election

Russia-2020Russia in 2020: scenarios for the futurePerestroika-21.11.1.211.2Early Putin1.31.3.22Stalin-lightPresidentialelectionsOlympiad Duma elections PresidentialelectionsWorld Cup2018

Russia-2020Wild cards scenarios- Russia Without Putin- Large-scalemanagement crisis- Destabilization of Neighbors- Destabilization inMoscow- World crisis- A Third War in theCaucasus- Schism in the Elite- Nationalist Coup- Soft Dissolution- European Choice- Bloggers’ Revolution

Davos Scenario Framework

Russia-2025Declining efficiency and rationalityVladivostok-2012Sochi-2014$22 billion (Russia’s 1999 budget)$ 50 billion1) Huge corruption when2) Constructing Potemkin villages;3) Counter-productive expenses

Russia-2025Alternative scenarios

Thank you for your attention!NPetrov@gmail.com