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Analysis & Opinion
11.11.08 Off The Mark
Comment by Vladimir Frolov

Medvedev was elected on the promise of staying the course and implementing what was then called “Putin’s Plan.” Things were going well for the country, with oil prices over $100 a barrel.

Medvedev was quite believable when he described his sweeping modernizing agenda for Russia as the four “I”s – institutions, investment, infrastructure and innovation. For a while, it seemed that Medvedev’s presidency would be a pleasure cruise.

It did not turn out that way. In August, Georgia’s invasion of South Ossetia presented the Russian leader with the need to send troops into battle to fight a former Soviet state - a decision his predecessor never had to make.

Then, in September, the global financial tornado put Medvedev’s modernization agenda in jeopardy. Russia now faces collapsing global demand for its principle exports, and the prospect of a prolonged deflation in the United States and Europe, further depressing Russia’s export earnings. At home, a consumer credit driven shopping spree is grinding to a halt, while businesses, finding themselves unable to tap international and domestic financial markets, cut back on investment programs. This is a situation Putin never had to face.

Life has dealt Medvedev a very difficult hand of cards and things, clearly, are not going as planned. That is why it was so important that in his first national address, Medvedev demonstrated that he had a plan to deal with the crisis that would reassure the jittery Russian public and the bleeding Russian business sector.

We are living in a new world now, and staying the course is no longer a good policy. “Putin’s Plan” needs a major upgrade. It is time to roll out Medvedev’s Plan.

What he did roll out was disappointing. It is hard to believe that a speech that was repeatedly delayed to give Medvedev more time to develop his ideas would hardly mention the financial crisis about to disrupt Russia’s growth, and that it would focus mostly on constitutional changes to Russia’s political system, an issue not on most people’s minds, to put it mildly.

While the decision to launch a full-scale constitutional reform is in itself remarkable - a subject that was a political taboo even under former President Vladimir Putin - its irrelevance to Russia’s problems of the day is striking.
There is little, if any, correlation between the duration of the presidential and parliamentary terms in office and the contracting economic growth, falling investment, depressed corporate earnings, frozen mortgages and falling personal incomes. People don’t really care about how long their presidents and members of parliament serve – they care about whether their policies lead to higher living standards.

It is true that Medvedev’s proposals are likely to somewhat increase pluralism and accountability in Russia’s political system, all for the better. Medvedev called for making the government accountable to the Duma, by making it a law that the government reports annually to parliament.

Another welcome step is his proposal to allow small parties that get between five and seven percent of the popular vote (short of clearing the seven percent Duma threshold) to send one or two deputies to the Duma to provide voters, who voted for such parties, some voice in the federal parliament. It is heartening to know that such worthy people as Grigory Yavlinsky, Leonid Gozman or Georgy Bovt will be seated in the Duma no matter what voters think of their parties.

Medvedev’s plan to delegate the right to nominate regional governors to the party that controls a majority in the regional legislature is also a step forward that makes the nomination process much more transparent and publicly accountable.

The same could be said of his proposal to reform the Federation Council, now a noble assembly of Russian billionaires and retired sports stars, by making only regional and local legislators eligible for election to the upper chamber – a requirement that would make the life of Russian billionaires and retired sports stars a little more difficult.

But extending presidential and parliamentary terms? To do what? To give them a better chance to implement their policy agenda? What agenda? We see a set of good-sounding platitudes in Medvedev’s speech, but no plan. This is what he had to say about the crisis: “We must not get carried away; the economic crisis is far from over. Throughout this period, we must remain extremely focused and pay maximum attention to both the efficiency of our work and the validity of new plans and programs.”

And he needs six years to do this?

Or take healthcare reform. Russia’s healthcare system is sub-standard. Only the rich get access to decent care. The Russian government has been fumbling one healthcare reform plan after another. Yet this is what Medvedev had to say on the issue: “We will have to gradually but consistently implement a fully-fledged health insurance system, fully-fledged in regard to both its scope and cost. The state must ensure that the health insurance system is financially balanced.” But how? And at what cost to the public?

Only on education reform does Medvedev offer something resembling a detailed plan, without saying how much it will cost. He picks the right issue – Russia needs a competitive education system to remain competitive globally. But the devil is in the implementation.

The foreign policy part of the speech is even more disappointing. His focus on reforming the international financial system and security institutions in Europe, while interesting and even inspiring, is a distraction from what the country needs right now. He is in no position to deliver on these issues, only to make proposals.

The tough rhetoric on missile deployment makes one feel that Medvedev is looking backward, not forward. Is he trying to emulate Yuri Andropov? Medvedev gives the impression that he is still trying to prove to the Russian and international audience that he is in fact tougher than he looks. He should relax. After South Ossetia, no one doubts his toughness.

What is in doubt is that longer presidential terms are the answer to Russia’s problems.
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