How efficient is the "System Putin" ?

Posted in Russia | 18-May-06 | Author: Dmitry Udalov

The ongoing war in Chechnya - Russia's nightmare.
The ongoing war in Chechnya - Russia's nightmare.
As the time approaches when Russia will host the G8 summit in St. Petersburg, criticism over the negative tendencies of Russian democratic transformation appear more frequently in various international forums and by representatives of world governments. This newsletter is an attempt to see and estimate the Russian political system and democratic trends as they are being shaped and developed by Russia's President, Vladimir Putin. The newsletter is presented by WSN's Russia editor, Dmitry Udalov, who is able to provide insight into these issues.

The newsletter is followed by interviews with Russian opposition leaders and youth representatives.

After the collapse of the Soviet Union, it was taken for granted that Russia had at last started out on the right track: A path that would lead to democracy, liberty and freedom. This belief was shared by the public and the scientific community as well. Fukuyama proclaimed the “End of History,” stating that there was no other political way than that of Western democracies.

But the collapse of communism didn’t automatically turn former authoritarian regimes into developed democracies. Today, the democratic transition of Russia is viewed with growing concern. Much of that concern is attributed to the policy of Russian President Vladimir Putin.

Putin’s approval rating has always been very high. For a thousand years, Russians have lived with the expectation of having a “good tsar.” Putin in contrast to Yeltsin tends to live up to this expectation. Russians trust him as a politician and as a man, approve of his actions and as the polls show, 56% want his successor to follow the same path. Why?

By 1999, the Russian economy produced only 60% of what it had produced in 1989. The political system was unstable, being controlled and manipulated by clans and oligarchs. State sovereignty in itself was on the verge of total collapse. The democratic reforms didn’t bring prosperity and in the eyes of the public became increasingly synonymous with failure.

“Triumph of Democracy” - silver coin issued by the Russian Central Bank
“Triumph of Democracy” - silver coin issued by the Russian Central Bank
Putin's predecessors did not pass on to him a country that was in great shape at the start of his presidency. And what people respect him for most of all is that he managed to avoid a total collapse of the state and was able to guarantee some stability. It might be difficult for some people to understand but for people who in 1982 didn’t have a single day when they could be sure of the next one, peace, order and stability are of great value. The situation in the late 1980s and in the 1990s resembled the one in Germany after WWI: Democratic liberties didn’t guarantee even the minimum wealth as people had to struggle constantly for food and the basic means of existence. A weak government could neither preserve democracy nor push rapid development.

Since the very beginning of his presidency, Putin has had a strong idea of restoring state institutions, strengthening federal power and centralization of the state. No doubt these were necessary steps to prevent the total erosion of state sovereignty. For example, one of Putin’s first steps was to bring local laws into accordance with federal ones and the constitution. By that time, there were a number of cases where local laws openly contradicted the Russian constitution.

The formation of a so-called “vertical line of power” was one of the first priorities. The way Putin's administration promoted this idea made some analysts question the actual importance of this step as it had the potential to bring the country under the reigns of Soviet-like centralization, which is precisely what happened. Thus, administrative reform instead of establishing a new efficient way of state management simply turned into centralization. The strategic decision making process in modern Russia is a prerogative of a very small group of the president's advisors, while the government and the parliament play largely a technical role of implementing their decisions. Think tanks, civil society groups and the media have almost no access to the shaping of national policy. This is obviously evidence of a poor democracy.

Having witnessed Putin’s vigorous ambitions to further centralize the state, many analysts were afraid that he would make changes to the constitution. But it wasn't necessary for Putin to do this. The Russian constitution adopted in 1993 gives the president of Russia ultimately a large range of power and instruments to influence and develop state policy. There were a lot of speculations during the Yeltsin era that the constitution was written especially to suit his “tsar-like” ambitions.

"Putin's predecessors did not pass on to him a country that was in great shape at the start of his…
"Putin's predecessors did not pass on to him a country that was in great shape at the start of his presidency."
Putin broadened presidential powers even more. In full accordance with the constitution, he initiated a law that gives the president the right to appoint governors. From Putin's point of view, this was a necessary step in order to preserve the unity and stability of the country and to be able to fight terrorism. The law was initiated after the Beslan tragedy. There is no doubt that Putin had enough arguments to support his decision. For instance, there were several striking examples of hard drinking, corrupt governors who became local tsars controlling business, local judicial and legislative powers. Besides, all local elections throughout Russia were reduced to massive corruption, frauds and even highway robbery.

Of course, Russian people are not very experienced in democratic procedures; most of them have never taken them seriously as a real instrument for shaping their future. Putin’s law deprived citizens of their right to elect governors because the Kremlin viewed its people to be too naïve and silly to make responsible choices. In fact, the corruption issue went from the local level to the Kremlin, which is now deciding who to appoint. There is absolutely no transparency in this appointment. Above all, the new system makes governors serve Moscow rather than their citizens.

So in the long run, the law is a serious hurdle for successful democratic transition. Everyone admits that it had been so easy to manipulate elections and that governors' rule was very far from ideal, but the way Putin solved the problem only promises further complications in the future.


A new NGO law was criticized and a reason for concern not only for Russian NGOs, but also for international ones and various world governments as well. Their rapid reaction did a lot to modify the draft of this law. According to the draft, any NGO financing from foreign countries was prohibited. As a result, all foreign subsidized organizations including absolutely non-political ones like the Russian chapter of the World Wildlife Fund (WWF) would have been forced to stop their activities in Russia. After a wave of protests, Putin introduced some liberal amendments to the first totalitarian draft, but the essence of the law remained unchanged – the government is eager to control civil society groups, their budgets and activities.

The final version of the law obliges Russian NGOs to provide detailed information on their budgets and to report on the usage of foreign grants and subsidies. The law installs a number of administrative hurdles: There are 96 new reporting forms to be filled by NGOs. The new law came into effect on April 17th, 2006 and its legal practice is to be worked out. Thus, NGO activists are appealing to the public that the battle for this law hasn’t finished yet as only concrete law practices will show whether or not the law is democratic or undemocratic.

The need for a new NGO law was explained as a way to control and halt radical Islamic expansion, because there were some examples of various organizations and programs being subsidized by radical Muslims to promote terrorism and religious extremism. At the same time it is obvious that the law can be used to control the civil society in general.

Mourning after the massacre in Beslan.
Mourning after the massacre in Beslan.
In addition, the process of the NGO law adoption showed that the Russian intelligentsia and Russian civil society managed to unite to oppose the first draft of the law. It was one of the rare occasions where the Russian civil society displayed its unified potential.

Economy stagnated by governmental mismanagement.

Putin achieved political stability, and high oil prices brought Russians some economic relief. Of course it is great luck to reign a country whose budget depends upon a world oil price that is currently skyrocketing. So it isn’t Putin’s fault that the world economy vitally needs raw materials. Yet some economists accuse Putin's economic policy of being too weak. They say that in the present favorable economic environment, annual GDP growth should be not less then 10-12% while Russia can hardly reach 6-7% today.

These figures reflect not only problems in the Russian economy but also in the present Russian political system as the main hurdles to rapid development are poor state management, corruption, state monopolies, weak arbitration and a complicated tax system. The state's intention to control the chief economic enterprises, like in the case of YUKOS, is a serious menace to free market competition and as a result to the national economy.

Putin is also blamed for inconsistent financial policies. Since the country began to have enormous budget surpluses, state authorities have been unable to invest this money effectively into the Russian economy, preferring instead to invest it in the US economy. Thus, the Russian government lacks initiative and doesn’t care much about the future. At the same time, it indicates that the present political system is outdated enough so that a highly competitive economy should be built up, provided that it has all the necessary economic prerequisites.

Though Putin openly addressed the country’s gravest problems like demography, poverty, education and healthcare, how these problems should be solved is highly debated. Putin declared four national projects designed to significantly raise living standards and the human development index in Russia: Education, healthcare, agriculture and accessibility to quality housing. The main idea of these projects is to invest in human potential. But the allocated budget spending to boost these four national projects is just $4 billion in 2006 and $5.5 billion in 2007. This is clearly not enough for a country as large as Russia.

Oil - the current source of Russia's richness.
Oil - the current source of Russia's richness.
It is impossible to start modernization without active public involvement and without dialog between the state, business and civil society. The state tries to omit this dialog, business tries to strike separate deals with the state - escaping free market competition - and the civil society either keeps silent or applauds.

“Russia concentrates!”

This was the answer of prominent Russian Foreign Minister Gorchakov, when Bismarck asked him why Russia was so passive in world affairs. This answer is also relevant today. For many in the Russian foreign policy establishment, it seems that the wisest strategy now is to concentrate Russia’s resources and capabilities on efficient foreign policy in the future. Even the failure of the Ukrainian 2004 elections is looked upon positively: Let the West take care of them and subsidize their economy, as it will only give us economic relief.

Other specialists and policymakers believe that 5 years of stability were enough for Russia to return back to the world stage as an active player. They want Russia to be a leader in the CIS states, the Middle East peace process and the Balkans; they seek new allies among future superpowers like India and China and hope to restore Russia’s superpower status.

Putin balances on these two trends. He constantly points out the necessity for an active and independent course for Russian foreign policy and the importance of restoring former prestige, but he also promotes the idea of pragmatism, having protested for instance to boost the military budget so as “not to repeat the USSR's gravest mistake.”

As the country and first of all its citizens are not ready to spend 60% of Russian GDP on cannons - as it used to be during some periods of the Soviet era - there are no objective reasons and capabilities for reviving a policy of global imperialism. At the same time, Russia will obviously be more active in the regions of its vital importance: CIS, Central Asia, Europe and the Far East. First of all, these regions contribute to the national economy and foreign trade. Central Asia is an important factor to the security and containment of international terrorism and religious extremism as well as of drug trafficking and illegal immigration.

Russia’s foreign policy lacks publicity and transparency. It is being shaped by a very narrow elite group, while business, private institutions, media and the civil society don’t influence much in the policymaking process. It is also one of the signs of weak democratic development.

Russian Democracy

"I consider the development of Russia as a free and democratic state to be our main political and ideological goal".
"I consider the development of Russia as a free and democratic state to be our main political and ideological goal".
While Putin has been criticized much for the undemocratic trends in Russia, he constantly speaks about the future of Russian democracy. Moreover, in his 2005 Address to the Federal Assembly that is considered to be a unified program of action and a joint program for the next decade, Putin placed special emphasis on his view of democratic transition in Russia:

“I consider the development of Russia as a free and democratic state to be our main political and ideological goal. We use these words fairly frequently, but rarely care to reveal how the deeper meaning of such values as freedom and democracy, justice and legality is translated into life” [Annual Address to the Federal Assembly April 25, 2005]. “It is my firm belief that for present-day Russia, democratic values are no less important than economic success or people’s social welfare.” [Annual Address to the Federal Assembly April 25, 2005].1

These two quotations in the major nation development program signify that Russian authorities have at least some idea of the importance of democracy for the future of the country. Meanwhile, the system that has been built does not fit the stated goals. The present system fights consequences but not the deep roots of the crisis that caused the collapse of the Russian economy and political system in 1991.

The Russian president is not likely to be that retrograde - striving to restore the Soviet Union, as he is frequently portrayed in the Western media. And it is not his desire to seize any democratic transformation in Russia. But due to his former profession, he pays higher tribute to national stability, security and order than to an open, free society. Like all Russians, Putin experienced the democratic “bardak” (complete chaos) of the 1990s and finds it his main duty to prevent it from arising again because as was the case back then, it could only lead to the total collapse of the state or to the ultranationalist military regime.

One of Putin’s objective pluses is that he never tried to play a nationalist card e.g. use nationalistic arguments in his domestic policy. On the contrary: Not only in the official statements, but in concrete actions he promoted an idea that Russia is a multinational and multicultural state, thus any form of nationalism or Russian chauvinism is a road to the total collapse of the state. The appointment of Tatar and Muslim executives on various top-level positions (Rashid Nurgaliev as Minister of Interior, Kamil Iskhakov, Presidential Plenipotentiary Envoy to the Far East Federal Districts; Aslambek Aslakhanov, President’s Advisor etc.) proves Putin’s adherence to non-nationalist principles. The only party that was officially denied the right to be registered was the Russian Nationalist Union.

Meanwhile, the problem of nationalist and neo-Nazi oriented groups exists in Russia, and the state proves to be inefficient in solving this problem. A number of cruel murders of African students and central Asian workers attracted government attention, but no concrete program was introduced to prevent such crimes in the future besides common measures of strengthening law enforcement structures.

Objectively, it is difficult to judge Putin’s policy only in black and white colors. The weakness of the Russian opposition provokes foreign actors to condemn the Russian political system. At the same time, fierce criticism from the outside strengthens the positions of hawks within Russia and makes them act vigorously in domestic and foreign policy. As a result, it also leads to political isolation that in fact disables the ability of developed Western democracies to positively influence the democratic transition of Russia. In the worst scenario, the Western world will be viewed in Russia again as an ideological and political enemy that seeks control of the country’s enormous natural resources.

It might be wiser to use a policy of integration to promote democratic values in Russia through the positive example of developed Western countries. There are well-established mutual forums able to do this such as the G8, the NATO-Russia Council, the Parliamentary Assembly of the Council of Europe, regular EU-Russia summits and the EU-Russia Common Spaces Cooperation. Each of these forums has a lot of tools to help Russia become liberal, democratic and predictable. Russia’s accession to the WTO is vital for this purpose, as Russian business would be bound to follow common world business rules rather than enjoy the home isolationism of a quasi-liberal economy.

To work constructively with Russians is of course more difficult than criticizing its authorities. On the other hand, the West today possesses enough valuable experience of democratization through integration and in the long run this policy will be more efficient.

It is also important to understand that today the Russian state wants to combine the economic benefits of a liberal economy with the stability of an authoritarian system. Though this might bring some noteworthy, quick results, in the long run this policy leads nowhere. The key to further democratic transition is to understand it. Some countries like South Korea used this strategy for several decades but realized its inefficiency and democratized the regime. There are doubts whether Russian authorities will realize the strong need to democratize and follow the South Korean example. Or they might be tempted to follow the North Korean way.

Conclusions and recommendations

  1. Russia has to realize the vital importance of further democratic development. It has to revive its own democratic traditions that were developed even earlier than those in Europe or North America.
  2. Only a transparent democratic system can halt Russia’s main problems of corruption and poor management.
  3. Europe and the US in their sincere desire to help Russia in its democratic transition shouldn’t impose vigorous persistence upon Russia as this only cripples the image of democracy in the eyes of the Russian people.
  4. The West should use wisely all mechanisms of mutual international forums to accelerate Russia's democratic transition.
  5. Non-direct means of influence like educational exchange programs, humanitarian and cultural cooperation via state structures, media, science and NGOs must bring positive results in the long run.
  6. Russian business should be integrated into the world economy. This would encourage Russian businesses to adhere to the common rules of a free market economy. Thus business would become the strongest promoter of liberal and democratic values in Russia. WTO membership is important for this purpose.
  7. The real success of rapid democratic transformation in Ukraine, easily seen through the improvement of living standards, might enforce democratic transition in Russia as well.

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