With a bit less than a year left to Russia’s Presidential elections in 2018, the general contours of this cycle’s protest movement against Putin are already coalescing.
Alexey Navalny has called a march for tomorrow along Tverskaya Street, a central boulevard that leads to the Kremlin. The Moscow mayoralty refused to allow it, and Navalny in turn refused its offer of alternative venues, so the march is going to be unsanctioned. These events tend to come with a high journalist to protester ratio, because Navalny’s office plankton constituency doesn’t like events where there is a non-negligible chance they’ll be roughed up by the police. So I don’t expect much to come out of it. But we’ll see. I’ll probably go myself to observe it first hand.
As in 2011-2012, when he coined the term “The Party of Thieves and Scoundrels” to describe United Russia, the brunt of Navalny’s attacks are going to be on corruption in the Kremlin. It appears that the centerpiece this time around is going to be a massive investigation carried out by Anti-Corruption Fund on Russian PM Dmitry Medvedev, and released early this March:
In Russia, even amongst liberals, Medvedev has a reputation as a cuddly, affable, and absent-minded sort of fellow, often nodding off at meetings, but endowed with a hip, modernist outlook that will take “Russia forwards” into the clean, prosperous, sponsored content clicking future. This expresses itself in things such as appreciation for Deep Purple, support for the Skolkovo technology hub, and an obsession with hip electronic gadgets – the latter of which earned him his nickname, iPhonchik. Another of his nicknames is his diminutive, “Dimon,” which became very popular after his press secretary told Russia’s bloggers, commenters, and online trolls not to use that name: “He is not Dimon to you.” That worked on the Internet! (Not).
But according to Navalny’s investigation, which builds on earlier work by Russian journalists, the nice, professorial teddy bear is a mere mask for a deeply corrupt swindler; not so much a fan of hi-tech Apple gadgets as of big money and elite properties. Piecing together documents, his team constructed a convoluted web of charitable funds directed by Medvedev’s friends, classmates, and even relatives that don’t seem to do much in the way of genuine charity work, but do maintain a sprawling network of elite real estate for make benefit of the Prime Minister.
This includes an elite estate in Moscow’s Rublevka district and a luxury ski resort in Krasnodar, each of which is valued at about $100 million; a big estate and agro holding compnay in his ancestral homeland of Kursk oblast; two yachts, both named after the Orthodox version of his wife’s name; an elite apartment in Saint-Petersburg; and even a wineyard and villa in Tuscany, Italy, bought in 2012-13 for $120 million. There is strong evidence, including from Medvedev’s Instagram account, that he has stayed at many of these properties, and partaken of his yachts.
These “charitable funds” are sponsored by a bevy of Kremlin-friendly oligarchs and state banks. For instance, one of them was funded by Novatek’s Simanovsky and Mikhelson, who contributed $500 million. The Uzbek oligarch Alisher Usmanov, who spent six years in a Soviet prison in the 1980s for financial fraud, appears to have funded the acquisition of the Rublevka property. Gazprombank is on record giving a loan of $200 million in 2007. Its Deputy Chairman at the time? Ilya Eliseev, a classmate of Medvedev’s from his time at Saint-Petersburg State University, who also happens to be listed as the current chairman of most of these charitable funds. In total, documented “contributions” run to about 70 billion rubles, or more than $1 billion.
Even a small fraction of this would sound the death knell for any politician in a country within the Hajnal Line.
In Russia, however, this is not atypical for the elites. Everybody knows that they are stealing, and if Russians didn’t move to overthrow them in 2011-12, in the aftermath of massively fraudulent elections in Moscow and at a time when Putin was at a trough in his popularity, they are certainly not going to do so now; not when Putin’s approval rating remains north of 80% in the long afterglow of the Crimea euphoria. Moreover, Navalny’s own reputation has since become tarnished, due to his own corruption scandal (which might disqualify from running for the Presidency entirely), and due to his ardent pro-Ukrainian rhetoric, which has driven off most of his former nationalist supporters.
This, at least, is my impression.
Anyhow, March 26 will be an opportunity to more directly gauge his support at the level of the streets.
Any idea of how the Russian billionaires are feeling about the 2018 elections? Will they back Putin, keep a low profile, or find a freshly minted new candidate to back, or a little of everything?
Is he that ardently pro-Ukrainian now? I haven’t paid much attention but I thought he was being hit from both directions for waffling.
I covered that (Ctrl-F “oligarch).
Well, he hasn’t gone full liberast on these questions as the Echo of Moscow crowd and the svidomy wanted him to, but he has made it quite clear that under him the LDNR will be doomed, that that and a second, “fair” referendum would be held on Crimea (which in practice would be a retreat from Russia’s stance that Crimea is unconditionally theirs, which will probably open the way for all sorts of further demands and blackmail from Kiev and the West).
[under him]
That’s hilarious just by itself. Seriously, even among the most moronic office plankton is there anyone left who doesn’t recognise that this “anti-system” politician is as much a tool and pawn of the system as any other?
The Crimea would still vote for independence/annexation to Russia in a second referendum so that’s not a bad idea. It would give the sanctioning countries an opportunity to save face and drop most sanctions bar some symbolic ones over rump Donbass. Oil is heading for much less than $40 a barrel by 2019/20 and the slump will last a long time as all the big conventional oil schemes started in 2012/13 finally come on stream. Once in place, production costs are tiny.
Russia needs international trade for its (so far dismal) non commodity exports rather badly. Not to mention productivity enhancing foreign investment. That means an outward looking President and administration, not seen since 2004. Stating the obvious, Medvedeev is being targeted as a preliminary to Putin’s retirement. Tit for Tat game theory predicts that once the end date, whether 2018 or 2024, is known it is advantageous to cheat. But Sechin’s star is not exactly rising at the moment so who is going to gain? Another Fortress Russia candidate will take the country further down the Argentinian road.
Nice day for the demo? Spring weather?
I am sorry Philip but Russians are not Ukrainians, Russians have a sense of dignity and don’t need any merchant cargo cults for the promise of a couple extra percentage points of GDP.
The Russian economy is recovering and is due for a boom regardless of sanctions.
working in the energy field I can say that it is clear that you are not aware of what most international agencies already say publicly (and most analysts know): if not additional investment will be added in the next years, there is a high risk of a price spike in the 2020s
https://www.iea.org/newsroom/news/2017/march/global-oil-supply-to-lag-demand-after-2020-unless-new-investments-are-approved-so.html
or earlier , according to HSBC
http://observer.com/2017/01/brace-for-the-oil-food-and-financial-crash-of-2018/
the excess oil inventories will be consumed in 1 or 2 years maximum, similarly to what has already happened to natural gas excess inventories
You really don’t get it, you Neoliberal dimwit. In the last 3 years, Russia has performed import substitution and innovations that were supposed to take decades. It even has its own Mir system to replace Visa/Database under SWIFT.
USA with its $0.5 trillion a year Trade Deficit and $20 trillion Federal Deficit is facing Economic Collapse sometime shortly.
No wonder Karlin minor went home to Russia.
Is there a market for Russian manufacturing exports in the West? Ukraine’s example shows otherwise: their exports to EU actually declined since 2013. “Productivity enhancing” Western investment didn’t come to Ukraine.
Russia’s own experience with the West shows that accomodation only breeds contempt. They made all sorts of concessions in 1990s and got nothing but democracy lectures in return. Suffice to say it took the US until 2012 to get Jackson-Vanic removed, only to replace it with Magnitsky act. :p
Based on demographics, US will look a Latin-American country by 2050. Europe will be increasingly Islamic. The West is clearly in decline, and I question the wisdom of attaching yourself to a dying civilisation.
I’d say the idea of Russia as a great power is central to Russian national identity, and this is what separates Russians from other Eastern European people. While Poles and Hungarians have long accepted that their fate is to be dominated by great powers, Russians believe their country is a great power and want its leaders to act accordingly. Navalny’s program of prostituting Russia to the West simply doesn’t cut it for a majority of Russians.
I was thinking about this article this morning and was wondering whether a senior political player in Russia could get away with living on nothing more than his salary even if he wanted to? Could someone be Prime Minister or President of Russia without the power, influence and ‘f**k you money’ security that a large private holding provides? If one is living in a world of oligarchs, could one be financially disarmed and actually get things done that would annoy the big guys?
I just want to thank you for the excellent, useful summary of the situation in this post and the following one. I was asked to explain those protests by my Canadian girlfriend, who’d seen a thread about them on Reddit, and I couldn’t find a useful summary that passed the smell test on FortRuss, Russia Insider or ColonelCassad (Saker hasn’t written anything yet). All the other write-ups focused either on dismissing it, making fun of it or spinning some elaborate conspiracy tale.
‘There is strong evidence, including from Medvedev’s Instagram account, that he has stayed at many of these properties, and partaken of his yachts…In Russia, however, this is not atypical for the elites. Everybody knows that they are stealing’
Did I get this right? It’s been several years since I last checked in to see what you were up to, about the time when you were putting the finishing touches on your supposed magnum opus ‘The Dark Lord of the Kremlin’ (whatever happened to this book, anyway?) that should have solidified your status as being the brainiest ‘Kremlin stooge’ of all time. But then again, how smart can a bonafide Kremlin stooge really be? And then I read these words that you’ve printed here? Not really the sentiments of a true-blue fan of the great leader of the Russian elites, now is it? Could it be that you’ve had a change of heart and can now also see that the great one (Vladimir Putin) has also enriched himself immensely and fraudulently at the expense of the Russian masses? Is it possible that Vladimir Putin has also been ‘stealing’ for oh so many years too?
I guess maligning Medvedev’s good name is Okay, but the Dark Lord’s is still sacrosanct (7 out of 10 aint bad in the world of politicians today, eh) ?
How about Navalny? Is he still considered a dupe of the CIA, or has he now been deemed a legitimate opposition leader (is there even such a thing in Russia)? You seem to have undergone a metamorphosis over the last few years, or maybe I just pegged you wrong in the first place?
The cost of fracking sand has skyrocketed since it collapsed along with oil. I’m pretty sure that is not used for conventional drilling. There are a lot of inputs that make shale oil more expensive, and this will forever be the case.
The price could go into the $40s. It could also go into the $60s. My observation is that the doom-and-gloomers always overshoot it, so it will probably not go below $40 this year. A few years ago when he was president Medvedev said that oil prices over $40 would be disastrous for the Russian economy, and he was correct. The Russian government should be hoping for stable oil prices – not higher ones, and it should be working on a more stable ruble.
My guru on this is Prof Patrick Minford, a specialist in the raw materials cycle, who advised the British Government on oil policy and much else when Thatcher was in power. He now focuses his studies on Chinese demand. He is top down, not bottom up. For the big picture he has the right approach. The issue is not inventory which is entirely short term. It is production capacity which is still coming on stream, whatever the hopes of drilling supplies companies for future approvals due to this short term and artificial recovery. If the capacity is there without new drilling or certainly infrastructure, it will get used. Minford is not, on the other hand, the go to guy if you are still thinking about drilling offshore in Papua New Guinea. We can probably agree there.
I can only agree with that.
Russia’s experience shows that a high oil price breeds hubris. And contrary to nationalist myths, Yeltsin made few concessions. He blocked foreign direct takeovers during the voucher programme for example.
The Argentinian point is mostly economic. Without anything to sell other than commodities and investment even in those, Australia fashion, Russia’s relative state of development will ebb away. Nationalist politics aimed at excluding foreign trade and investment didn’t help Argentina
either. Other than that, see my next remark to Anatoly.
And how much business do you do in Russia? When you can distinguish total propaganda from something approaching reality, never actually possible, even direct experience, which I have, is partial, feel free to comment. Until then restrain the ad hominens. And I’m a Liberal not a neoliberal whatever straw man gibberish that is.
Where is the capital coming from? The work force is shrinking at an enormous rate. Without large scale immigration (not desirable anywhere in the Old World), there will be a switch from profits to wages. This will compromise capital investment further. The opportunities for catch up investment are there but the money has to come from somewhere. Examples: The best the Chinese could offer was Russia’s own roubles back to build a section of rail track that would have locked Chinese trains onto the whole high speed network. Russian Railways is now working with Siemens again but much more on Siemens terms than first time. Internal distribution is a problem. The biggest developer of distribution warehouses in Russia is British. They are no longer building speculatively.
Russia is not the sort of place do to bootstrapping well. Right now, the government is providing massive subsidies to all sorts of agricultural projects, like glass houses in Novosibirsk to try and substitute almost all imports of food. This is a huge misallocation of capital. Most of the economists know this; Najibulla does much to ameliorate it but the business lobbyists have the ear of the nationalists. Subsidy is spreading, at least until the wealth funds run out. Then tax must rise. It’s not going to impact hugely on the general population until the workforce decline is over. Their wages will be preserved. It’s a matter of lost opportunities, Argentinian style. Right now, the big opportunity is reconciliation with Japan which has bundles of cash and an ageing population. This is happening. China has noticed.
http://expert.ru/2017/01/12/kitaj/
You are a very primitive person – indeed, a troll in the most direct sense of the word – who is either too stupid or too ideological to grasp the concept of nuance in political analysis.
Absolutely nothing in this post conflicts with the main corpus of my work, which contains one of the most detailed accounts of Russian electoral fraud in Russia.
As there, I am decidedly uninterested in discussing anything with you (read: Replying to your loaded questions). Go bark at The Kremlin Stooge, or whatever.
PS. Just a reminder that I was anti-Medvedev way before it became cool.
http://www.unz.com/akarlin/dam-what-a-president/
http://www.unz.com/akarlin/medvedev-drug-warrior/
What Western politician was ruined because of corruption? Just recently 65 million Americans have voted for a woman who is ten times more corrupt and evil than Medvedev, and other 62 million voted (out of despair, mostly) for a tycoon who is corrupted by the very definition of a tycoon.
I think the idea of Russians that there is some fairy-tale land of honest people in the West is largely imaginary. Mostly it comes from the 1990s when the Russian people really tried to become westernized because they believed that the West, unlike of the USSR or Russia, is a perfect land with no vice. But the truth is the contrary idea that politicians along with businessmen, policemen, the military and some others are corrupt is deeply ingrained in the Western culture. A lot of Western books or movies depict their own corruption. And today everybody say how corrupt the system has become (or was it always that way?).
Navanly is an ethnic Ukrainian*, so he thinks Ukrainian.
*Not fully, his mother is Russian, but he openly said he is rather Ukrainian (citation: “Я наверное, больше украинец по своим каким-то корням и генетике” = “I am probably rather Ukrainian by origin and genetics”).
Don’t read “The Saker”, at least don’t take his hogwash ever seriously. He is a deranged Swiss retiring in the USA (sunshine FL, probably) who thinks his White-Russian emigre father (or grandfather?) makes him an expert on everything Russian. If one wants to read deranged Russian overzealous patriotards, better to read real Russians and not US residents.
By the way, speaking about the frauds, it is always important to bear in mind that “ER” actually stole votes from the Communists. So most Western journalists, analysts, etc., who whine about the frauds (I do not mean you, don’t worry) are actually supporting the bloody Communists! I wonder how many Western liberals are aware of that. Would they prefer more Communists in the current or previous Duma?
Communists and LDPR, even more despicable!
The main way Russian electoral fraud works is not by reassigning votes from KPRF to ER or whatever, but by directly adding fictitious votes to ER (hence the close correlation between turnout and percentage of the vote for ER across polling stations in those regions where fraud is happening).
Since KPRF is usually the best performing opposition party it does typically suffer most in absolute terms, but not in relative ones.
But the result is the same anyway: the Commies get more seats.
Not according to NYT, WP, Guardian and who not, who organized a propaganda media campaign in the West during 2011-2012. They must’ve been Commies undercover. McCarthy’s cause was never finished!
God. What an idiot! Russian government need to hire trolls to promote this line on social networks – teenagers will stop supporting him.
Is Putin corrupt?
No an accusation, just want to know.