RUSSIA IN CRISIS: CAN PUTIN SURVIVE?
Putin’s Russia seems to be under dire threat. Ukrainian sanctions by the European Union and the United States coupled with the plunge of oil prices could cost the Russian economy as much as $130 billion or $140 billion this year. This will likely push the Russian economy into recession and make its debt rating “junk.”
The open contempt shown by Western leaders – “bored kid in the back of the classroom” (US President Barack Obama), “only a regional power” (Obama), “Hitlerite” (Hillary Clinton”) and ”thuggish, dishonest and reckless” (British Ambassador to the United States Peter Westmacott ) – reflect the depth of Western hatred of Putin.
Russia seems vulnerable to following the path of the color revolutions that have overthrown authoritarian rulers in the former Soviet republics of Georgia (2003 Rose Revolution), Ukraine (2004 Orange Revolution) and Kyrgyzstan (2005 Tulip Revolution) and helped dissolve the Soviet Union (1991).
Putin’s Russia has no appealing ideology, such as communism, which helped the Soviet Union to survive for 74 years. It has the profile of a Third World country, exporting primary goods and importing secondary and tertiary goods. Russia has already had four successful revolutions since 1917 – February and October (1917), Stalinist Revolution From Above (1930s) and the Fall of the Soviet Union (1991) – so many ask why not a fifth one? Having lost 50 percent of its population in 1991, Russia has a $2 trillion economy, barely 14% the size of the American economy. It has never had an agricultural revolution, consumer revolution, modern middle class or significant Silicon Valley. Russia remains a kleptocratic authoritarian society without an independent judiciary, press freedom, or transition to democracy. It also suffers from recurrent capital outflow, which reached a stunning $150b. in 2014.
Russia was defeated in World War I (1914-1917), the Russo-Polish War (1920), the Cold War (1947-1987), Afghanistan (1979-1987) and First Chechnya War (1994-1996). Even its victory in World War II (the Great Patriotic War) came at the staggering cost of 17 million civilians and 10 million Red Army soldiers killed.
And yet, there is little likelihood that Russia and Putin will fold. Putin remains at a stunning 80% approval rating in Russia. His quasi-annexation of Abkhazia and South Ossetia (2008), Crimea (2014) and likely parts of Left Bank Ukraine (2015?) is very popular at home.
And Putin retains some key assets.
Russia, with one of the five permanent seats on the United Nations Security Council, has a large-scale arsenal of strategic and tactical nuclear weapons, equal to that of the United States. Russia spends $70b. on the military which, despite problems, remains the No. 3 military in the world. It has a reserve fund of nearly $90b. With almost a million scientists, technicians and engineers, Russia can place well in global defense technology.
Just as Westerners often disdain Russia, many Russians disdain the West, which gave them little credit for helping win World War II, beat them in the Cold War, provided no help in the transition after 1991 and hailed a highly corrupt capitalism in the 1990s. Putin’s conservative nationalism and support for the Russian Orthodox Church is very popular in the countryside and smaller towns.
The EU, with 1% GDP growth, minimal military spending (1.6% of GNP) and major internal problems, will not likely increase Ukrainian sanctions and needs Russian natural resources. Germany, the leader of the EU, is hobbled by having committed genocide in the Soviet Union during World War II and being a major trading partner of Moscow.
The United States, distracted by internal problems, Middle East terrorism and a lame-duck President, is not willing to take tough measures against the Russians. There is little Western enthusiasm for taking strong steps to salvage a poor ($4,000 GDP/capita), populous (46 million people) Ukraine with a significant pro-Russia element.
Aided by his first-rate foreign minister, Sergei Lavrov (whom I met twice in the late 1980s), Putin often plays chess while the West plays checkers.
Taking advantage of America’s semi-withdrawal from the region, Putin has made significant progress in the Middle East.
Russia’s $4.5b. in military equipment has turned Syrian President Bashar Assad from a likely loser in 2011 to a likely winner in key areas of Syria in 2015. Egypt, hostile under presidents Hosni Mubarak and Mohammed Morsi, now is friendly to Moscow, which has sold it over $2b. of weapons.
Israel, which Putin has visited twice, sells drones to Moscow and helps with commercialization of Russian technology at Skolkovo. Russia supplies Iran with 70% of its imported weapons and has built the Bushehr nuclear reactor.
Putin is also turning successfully to Asia. He has worked with Japan whose Prime Minister Shinzo Abe sat next to him at the Sochi Winter Olympics. He recently signed a massive natural gas deal with China worth hundreds of billions of dollars, while Russian oil exports to China have increased 50% in the past five years. Putin on a visit to India in December signed deals worth $100b., including sale of 12 nuclear reactors ($40b.) and increased exports of oil and natural gas ($50b.).
Putin, despite difficulties, is likely not only to survive but to continue successfully on the path of enhancing Russia’s power in the new post-Cold War era.