Will The Economic Crisis Cause Political Unrest In Russia?
|Introduced by Vladimir Frolov
|Contributors: Vladimir Belaeff, Stephen Blank, Ethan Burger
The world’s economic and financial crisis has led to serious social discontent and political turmoil in the hardest-hit countries of Eastern and Western Europe. These events have led some Russian analysts and opposition politicians to speculate that a similar wave of discontent might engulf Russia this year, as demonstrations against increased automobile import duties in Russia’s Far East have shown that Russians are indeed capable of protesting. But will the understandable discontent over the economic hard times really translate into increased support for Russia’s opposition parties and more radical groups?
In the financially-bankrupt Iceland, people have been regularly staging mass protests demanding the government’s resignation. In Greece, youth groups and leftist movements have managed to engulf parts of the country into a semi-civil war, with riot police fighting bloody street battles with protesters. In Bulgaria, protesters marched to the parliament building in Sofia demanding more effective government policies to fight the crisis now devastating Bulgaria’s economy.
In Latvia and Lithuania, some of the hardest-hit nations, where the crisis led to a virtual collapse of the national banking system and caused massive unemployment, thousands of protesters took to the streets, attacked government buildings and battled the police in some of the most massive social protests since the fall of the Soviet Union.
The unrest in these Baltic countries led to a deep crisis of confidence in national governments. Protesters were angry at national leaders for their ineptitude in handling the crisis and unwillingness to take more decisive measures. The street protests led Lithuanian President Valdus Adamkus to speculate that they might have been instigated by a foreign country, an unwarranted and speculative accusation of Russia to shift the blame from the inept local leadership.
These events have led some Russian analysts and opposition politicians to speculate that a similar wave of discontent might engulf Russia this year. Indeed, there are some reasons to think that this is possible.
Incomes that have been steadily rising in the last eight years are now dropping, due to lower wages paid by employers and the ruble’s devaluation by some 30 percent since last August. Social payments, kept steady by the government, have correspondingly decreased in value. Unemployment, virtually non-existent in 2007, is rising, with at least 1.5 million people losing their jobs in 2008 alone.
The Russian government’s policies have caused serious discontent in the Russian Far East over the decision to raise import duties on used foreign-made cars to bolster the domestic car industry. This would have the immediate effect of putting millions of people in the Far East, who have been making a living by selling used Japanese cars, out of business and out of work. Street protests over this decision in Vladivostok and even in Moscow ensued, with some protesters calling for Putin’s resignation. Crack riot police units from Moscow had to be flown to Vladivostok to disperse the crowds, as local police were too sympathetic to the protesters.
Former Prime Minister Mikhail Kasyanov and former Union of Right Forces leader Boris Nemtsov predicted that 2009 would be a year of Russia’s social and political discontent.
The Kremlin is closely watching the situation, and is taking preemptive measures to prevent massive protests due to the crisis. Vladilslav Surkov, the Kremlin’s chief political strategist, has called for measures to “save Russia’s fledgling middle class, the core of Putin and United Russia’s political base.” He specifically called for measures to maintain the middle class income and consumption levels achieved during Putin’s years, realizing that failure to do so would create a massive layer of disgruntled and highly educated people who might be willing to engage in opposition political activities. Surkov also advised United Russia to stage massive street actions in support of the government’s policies.
Although Vladimir Putin’s and Dmitry Medvedev’s popularity ratings remain high, polls show that more and more people think the country is moving in the wrong direction. It might be only a matter of time and more economic hardship before this translates into anti-government political activism, or so the opposition hopes.
But are these expectations justified? Is Russia really set to see massive social discontent and political unrest across the country in 2009? How is the crisis affecting the vaunted “political stability” that has been the hallmark of Putin-Medvedev’s rule over the past decade? Will the understandable discontent over the economic hard times really translate into increased support for Russia’s opposition parties and more radical groups? Are they in a position to capitalize on the changing social mood in the country? Or will the Kremlin’s preemptive measures and policies work to preclude social discontent from transforming into a broad political opposition movement? How will the West react, were Russia to experience serious political turmoil due to the crisis?
Ethan S. Burger, Adjunct Professor, Georgetown University Law Center, Washington, DC:
Perhaps the two most significant words in the title of this week's discussion are "political" and Russia." According to many sociologists, rising unemployment combined with declines in living standards does not have a causal relationship to either growth in crime or political unrest. To many, this may seem counter-intuitive. It is probably the absence of "hope for change" that is the critical factor.
The rioting that occurred in the United States following the assassination of Doctor Martin Luther King probably began as an expression of anger or frustration that had been building up for many years (decades). Of course, not all those persons who took part in the riots were politically motivated.
Ironically, the better "organized" the unrest, the more likely the government is to have counterparts to engage, and these counterparts may be older than that of the average demonstrator. The manner in which order is restored frequently determines the length and severity of political unrest.
Anger and frustration commonly increase among the population when there is an absence of hope, the political leadership seems oblivious to the citizenry's needs (and in fact refuses to acknowledge the legitimacy of their complaints), and if there is a noticeable (and unfair) allocation of the economic hardship to the shoulders of the population.
The risks of upheaval increase if the country's political leadership does not engage in a dialogue as to what steps it will take to lessen the economic hardships that arise, and greets peaceful demonstrations (spontaneous or organized) with force. I think this analysis applies generally to Russia, Thailand or Zimbabwe, although each country's political culture, ethnic composition and history vary.
There are many factors that produce political unrest. In isolation, rising unemployment and declines in living standards do not "cause" political unrest. They act as the kindling that makes a conflagration greater. There are many causes of political unrest, which seldom breaks out spontaneously. People fear not having sufficient resources to ensure having access to quality medical care for their family, to pay for their children's higher education, to finance a dignified retirement, and to purchase "high ticket" items such as homes, automobiles, etc.
If people believe that the government lacks the desire or ability to fulfill its end of the "social contract," it risks being swept away. Ironically, the more repressive the response by the authorities, such as occurred in Vladivostok when people protested the higher import duties imposed on automobiles, the less legitimacy it will have in the eyes of the people.
Demonstrators should be given fora and access to the media to voice their grievances. If the authorities deny them, the danger of political unrest increases and the probability of finding solutions for economic problems decreases. If the Russian government continues its policy of centralizing political power and making government officials less accountable for their actions, they will continue running greater risks in the long term.
Vladimir Belaeff, President, Global Society Institute, Inc., San-Francisco, CA:
Indeed, a wave of social unrest is rolling through Europe at this time. Other continents may be due for similar events. I see three distinct causes for this. There is the protest against failed economic policies of specific governments (Iceland). In other situations, unrest is a response to austere measures (Latvia, Lithuania). Finally, there is the unrest that is only indirectly connected with the crisis (Greece). At this time, only in Iceland did the unrest cause a change in the government.
Can the crisis result in extensive protests also in Russia? The recent events in Primorye, in my opinion, are not a significant harbinger -- they were focused on a very specific grievance, and involved mostly those citizens who make a very lucrative livelihood by selling used Japanese automobiles in Russia.
Russian citizens affected by the crisis, at all social levels, understand that their distress is caused by failed economic policies in a country that does not enjoy much respect in Russia -- the United States. In effect, the Russian government rightly takes credit for having built substantial liquid reserves that now help deal with the crisis in a controlled manner. Russia's social safety net available to its citizens at this time is much more robust than what is available to Americans in similar circumstances.
So what would the citizens protest against? A demonstration against the crisis itself would be addressed at the United States, and protests against government policies have no basis, because Russia's policies in handling the impact of the crisis have been remarkably skilled.
Western media have celebrated recent VTsIOM reports of a few point drop in the popularity ratings of the Medvedev-Putin team. But a detailed analysis of the numbers shows that the change is within the sampling error -- the fluctuation has no statistical significance. If one compares the level of social confidence in Medvedev-Putin with other runner-up politicians (Zyuganov, for example) the ratio is ten to one in favor of the Russian government.
And the so-called "opposition" -- Kasyanov, Nemtsov et alia -- are not even on the radar. They genuinely have no social traction, no credible alternative program or politicians. Kasyanov is widely known by the nickname "two percent Mike" -- an allusion to the rumored skimming of two percent of the value of the deals that crossed his desk when he was in Russia's government.
In conclusion, I do not believe that severe and widespread social unrest caused by the global economic crisis is likely in Russia. The country has changed a great deal and is eager to continue its growth, rather than risk destroying the dynamics of its economic mechanisms through irresponsible actions. Russian citizens' frustration is and will continue to be directed at causes of the crisis external to Russia, in particular if a perception develops that some foreign powers are stalling the process of global recovery.
In the West, there is a coterie of obsolete Sovietologists who have an irrational abhorrence of "Putin" (a mythical construct, not related to the real person, hence my quotes.) These Cold War enthusiasts hope for a regime change in Russia, driven by social unrest, which would start as an economic protest against the global crisis and become a political revolt.
Something like a re-run of the Orange Revolution, in Moscow. Well, this sequence of events already happened in Russia once. In 1917 Russia had its Orange Revolution. Modern Russians are acutely aware of the consequences of that episode, and are unlikely to want to repeat the experience. Russia's path is now evolutionary, not revolutionary.
Professor Stephen Blank, the US Army War College, Carlyle Barracks, PA:
I have no doubt that popular social and economic discontent in Russia will rise over the course of 2009. But there is a significant series of differences between Russia and the neighboring states of Eastern Europe in dealing with it. First of all, Russia is an autocracy that increasingly manifests signs of borrowing from Soviet policies and symbols, and equally from the right-wing of Weimar Germany. In those latter cases, the political murders that go unpunished, the corruption of the judiciary, the visible intellectual lineage from Weimar conservatives to Russian political intellectuals, are all signs of this.
Moreover, the government's instruments of repression have been beefed up and strengthened, and by all indicators are readily available. In other words, whereas the authorities in these other countries are not prepared to use violence to quell unrest, Moscow is quite ready and has already showed how it will do so.
Secondly, Russia has already responded to the crisis. It has conducted a stealth depreciation of the ruble in the misguided belief that it can orchestrate a soft landing for it. Thirdly, it has bailed out oligarchs and big banks lest their foreign creditors take over companies that were offered as collateral for loans that now cannot be repaid.
Fourthly, it has announced a huge campaign of defense spending, even as it takes over more and more industries as part of the giant state corporations under Rostekhnologii to do. The abortive weapons plan of 2006-15 has now been compelled to be completed by 2011, so that a new and equally predestined to fail ten year weapons plan of 2011-2020 can begin and consume even more money that Russia does not have.
This conjunction of bailing out corporations by taking them over in one way or another, vastly increased defense spending, permanent inflation that is built into the system, autarchic moves such as trying to create a ruble bloc by which to subordinate Russia's neighbors, partake in both Soviet or, more aptly, totalitarian practices. This is not to say that we have arrived at the last stop of the train. But its route at the moment is a very dangerous one.
Beyond that, however, Moscow has no effective answer to the crisis. It tied its fate to energy and did not bother to invest sufficiently in alternative sources of wealth production or human capital. Indeed, at current prices of energy on the world market the budget will suffer an estimated deficit of four trillion rubles.
This crisis will show in graphic detail just how suboptimal the Russian economy is, and how patrimonial it remains. Many of us, this author included, predicted this outcome. The efforts by Medvedev to introduce some timid liberalizing reforms from above appear to have run into the ground, as the “Putintsy” want to safeguard their sources of their wealth in the energy industry.
Until and unless oil prices rise, it is difficult to see how the current policies, autarchic maneuvers, state takeovers, inflation, and vastly increased defense spending translate into growth and prosperity.
Undoubtedly there is already popular resistance, as in the Far East, and probably there will be more. But unlike the situation in neighboring states, Russia is prepared, or so it seems, at any rate, to drown this unrest in blood and violence.
Indeed some rulers of the CIS learned from the color revolutions that this is what they must do to stay in power. So if unrest force will be invoked, we shall then see the consequences of that violence.