Highlights from my /r/Russia AMA

A couple of weeks back I had an AMA (Ask Me Anything) with /r/Russia.

Direct link: Hi /r/Russia! Anatoly Karlin, writer for The Unz Review / Анатолий Карлин, “пейсатель” о России, геополитике. AMA!

Thought I would reprint some of the questions and answers there so that they don’t vanish into the digital ether.

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Politics

You were at the March 26 protests

Can we confidently say that the Kremlin lost young voters forever.

Does Russia have a new protest generation?

For example in the west, there was the contrast between the WWII conservative generation and the young generation of the 60s( this so-called counterculture )

Yes, here’s my account of the March 26 protests.

I don’t think the Kremlin has lost young voters, though some kremlins are definitely trying to. Ultimately, Putin after Crimea still has the steady support of about 80% of Russians, so that precludes any great dip in support amongst young people.

My impression is that paradoxically, both liberal and pro-Putin sentiments might be somewhat higher amongst the younger generations, alongside a melange of other, more idiosyncratic ideologies like monarchism and whatnot. Why? Because Communist sympathies collapse amongst younger Russians. That is, relative to the older generations, there are still plenty of “vatniks,” but many fewer “sovoks.”

If there is going to be a strong youth-based protest movement in the future – which isn’t the case now, 8,000 protesters in a city of 12 million is nothing – I suspect nationalists will play a big role in it.

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Two questions

1. In your opinion, what are the most important politcal challenges facing our country and how can those challenges can be adress?
2. What should the federal government’s top three priorities be in setting a sound foreign policy vital to our interest?

(1) The lack of a clearcut succession mechanism is a serious problem. Putin after Crimea has become sort of what the poli-sci types call a “charismatic leader,” so his own power is quite secure, but you can’t say the same for the beigeocratic bugmen who make up his entourage from Medvedev on down. Hopefully he can groom an adequate replacement in his remaining years as President.

(2) It all boils down to this: Be smarter.

Alexey Pushkov: “Russia invested $200bn in Ukraine’s economy in the past 20 years, the US – $5bn in the “development of democracy.” Looks like we didn’t invest correctly. Important lesson.”

The lack of a clearcut succession mechanism is a serious problem. Putin after Crimea has become sort of what the poli-sci types call a “charismatic leader,” so his own power is quite secure, but you can’t say the same for the beigeocratic bugmen who make up his entourage from Medvedev on down. Hopefully he can groom an adequate replacement in his remaining years as President.

What do you think might happen if Putin fails to produce a successor in time (for one reason or another)? Are there any political elites or oligarchs who might be plotting an aggressive move to be executed against Putin (if his support wanes over time) or shortly after him suddenly stepping down (ill health, death, or something else)? Maybe someone in the military or siloviki? Indeed, the lack of any clear mechanisms will cause chaos, which will be an opportunity for some.

I am just as skeptical about the prospects of an internal coup against Putin as about the prospects of a color revolution (detailed article about this).

Putin’s approval rating hasn’t consistently dipped below 60% since late 1999. Any event or development that brings it down into dangerous territory is likely to be so unexpected and traumatic that little could be meaningfully predicted about it. If Putin steps down due to “life” reasons (e.g. ill health), Medvedev would be the immediate logical successor. He will get by in the short to medium term, I suppose, though being much less popular and charismatic than Putin his position will be shakier.

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How much of a role did the US have in the Russian troubles in the 90s? Mostly talking about the domestic problems. Aside from their monetary support of Yelstin in the 1996 election, can’t think of any nefarious actions, while some claim that the CIA conspired with the oligarchs to destroy the country, and then with the Chechens to destroy it again, and so on. From what I’ve read, the US (as a whole, with the exception of some officials including presidents) was mostly disinterested in Russian domestic problems, leaving it to its own problems.

Do you think that if the US managed to execute a Marshall plan-style aid for Russia back then, it would have been a better place now?

I think US role in that is overdone in “patriotic” Russian propaganda. Most of the damage was either self-inflicted (the kleptocratic nature of the privatizations), or inevitable (reintroducing markets after 60 years of central planning – you can turn a fish into a fish stew, but turning a fish stew into a fish is harder, as the economists joked).

To be sure, the oligarchs pretty much were Western agents of influence, but I agree with you that the dominant US policy towards Russia was disinterest.

Russian opinion towards the US was extremely positive in the early 1990s, through to the war against Serbia. There were even serious considerations of pursuing NATO membership through to the early 2000s. If there ever was an opportunity to draw Russia within the Euro-Atlantic orbit and preempt a Sino-Russian alliance, it was then. Instead, Washington D.C. considered itself the victory in the Cold War and chose to expand NATO (a policy opposed by both George Kennan and Henry Kissinger).

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Do you think Lenin will be buried? How do you expect the 100th anniversary of his revolution will be “commemorated” in Russia?

Lenin was a traitor, so if his body has to be disposed of in some way, it should be cremated and scattered to the four winds.

That said, it does have some historical value as the oldest well preserved body in the world, so perhaps it could be moved to an outskirt of Moscow. Maybe the commies could crowdfund a “shrine” of some sort there.

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If Vladimir Zhirinovsky had a daughter named Martine could she lead the LDPR to power?

Martine Lebedeva would be a good name for a video game anti-heroine.

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Political Theory

Any favorites among right-wing thinkers from nineteenth century? Do you think that, say, Pobedonostev still holds water today as an actual political philosopher, or he should be read from purely historical POV? Name your three favorite russian philosophers, right-wing or not.

I haven’t studied Pobedonostev in any great depth, but I’m not enarmored with him; too often he seems to adopt egregiously reactionary positions just for, well, the heck of it.

I do recall him having some good thoughts on how the mass media operates, rushing to print anything without fact-checking (#fakenews?). But his proposed solutions tended to be antagonistically authoritarian, and some were outright crazy, like his arguments against mass schooling.

Favorite 3 Russian philosophers:

1. Ivan Ilyin
2. Vladimir Vernadsky
3. Nikolay Berdyaev

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What’s your take on classic Moldbug writings from 2008-2013, and separately, on current state of neoreactosphere?

I am not a big fan of Moldbug.

For instance, he not only denies AGW, but also seems to be under the impression that this makes him some sort of dissident against the “weaponized memeplex of Hypercalvinist Atheo-Oecumenic conspiracy,” as opposed to just subscribing to one of the tenets of Conservatism Inc. (USA).

As for his big idea, neocameralism – dividing up sovereignty into shares to be bought up by Silicon Valley oligarchs? Congratulations, neoreactionaries – you’ve just handed the SJWs absolute political power on a platter.

My view on NRx (in its original formulation) is that it was just libertarians trying to deal with the fact that the average person has an IQ of 100. Since I was never a libertarian, it never appealed to me all that strongly, despite certain sympathies for it. To be sure, there was also an “ethnonationalist” strain in NRx, but my impression is that it has since pretty much merged into the Alt Right (as Michael Anissimov predicted a couple of years back).

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Let me just say that I greatly value your blogging over the years. It’s a breath of fresh air. Western coverage of Russia is 100% propaganda but the simpletons over at RT are not much better. I realise your biases – you’re open about them – but I much prefer that over feigned ‘neutrality’ which always end up in a monotone demonisation.

Now to my question. Putin strikes me as less of a nationalist than an imperialist. An imperialist believes in a larger, over-arching idea. Rome went from being a nation-state to an Empire, and being “roman” moved from an ethnic concept to a universal concept. Same is true with America.

In my view, if you’re a Russian nationalist, then you should be against imperialism. This isn’t to say that you don’t want Russia to be strong(which is often confused with being an imperialist by naïve people). Because only nationalism will preserve the Russian nation(see the Central Asian immigration problem).

So, with such a large preamble, do you A) agree with my characterisation of Putin and B) what do you think are the chances of purely ethnic Russian(with some allowances for other ethnicities, as long as they meld into the larger Russian core) nationalism? I’m thinking post-Putin mostly given that he is in his mid-60s and is unlikely to change.

I am a Russian nationalist, but I subscribe to the concept of the triune Russian nation – i.e., of Great Russians, Little Russians, and White Russians – as the nation-building core of a prospective “Big Russia.”

This implicitly demands the eventual reunification of the Russian lands – not as an imperial project, but a nation-(re)building one.

The most “imperial” aspects of Russia are (1) Chechnya/Ingushetia/Dagestan and (2) Central Asia, both of which were only brought within the Russian Empire in the middle of the 19th century. And I am indeed lukewarm about whether or not the former should remain within Russia, and am certainly opposed to any significant degree of integration with the latter (not least for demographic reasons: There are about now as many young Central Asians as there are ethnic Russians).

With that out of the way, to answer your specific questions:

(A) Putin is an imperialist, a nationalist, as well as a conservative, a liberal, a liberal-conservative, a patriot, a sovok, an opportunist, and so forth. His modus operandi has always been to balance between different political and ideological factions.

(B) Support for this strain of nationalism is certainly growing – as of the latest polls, “Russia for [ethnic] Russians” enjoys about 50% support, and that viewpoint is relatively far more prevalent amongst the younger generations.

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Geopolitics

Who will take power next in Ukraine? Do you think the Kremlin’s decision to take a passive approach will be vindicated? My impression is that Ukraine is a bit of a dumpster fire at the moment, which will make anyone who steps inside regret it. But then, vigorous action might have and might yet restore the status quo ante of a reasonably large and friendly buffer state (minus west Ukraine).

I speculated about developments in Ukraine here. There’s a possibility that Tymoshenko is mounting a slow-motion coup against Poroshenko with the help of Turchinov, Kolomoysky, and his pet far right batallions.

I unenthusiastically supported Minsk II at the time, however I think since then its detractors have been proven right – as of Q4 2016, the Ukrainian economy was growing by close to 5% (after all, even Ukraine has to hit bottom at some point). That said, Trump’s election victory is an unexpected wild card that may yet rescue the day, and Ukrainian nationalists have proved to be reliably helpful.

restore the status quo ante
friendly buffer state

Pick one. Pre-Maidan Ukraine was not friendly.

Yes, this is true. Yanukovych only turned to EEU at the last moment, right after running an extensive pro-EU campaign. Genius!

The demographics in Ukraine are also very unfavorable in terms of attitudes towards Russia. The Far West is growing vigorously – it has some of the highest fertility rates in Europe – whereas the Donbass was in a true death spiral even before the war.

Moreover, even I can sympathize with Ukrainians who don’t want their country to be a buffer state. While both the EU and Russia can sell tantalizing (if unrealistic) visions of what is possible – TyschaVDen’ to the west, space race victory to the east – literally like, nobody, wants to be a “buffer” between a bunch of gayropean degenerates and sovok cretins. 🙂

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What is your opinion on the syrian intervention and how much longer in your opinion will we stay in the country?

I initially supported it on the theory that its goals were to provide cheap real life training for the Russian Air Force; secure itself a couple of useful bases in the MENA region; use it as a bargaining chip with the US in future discussions about spheres of influence in Eurasia.

I have since become more skeptical about it. There is now a much larger degree of involvement, including ground involvement, and it seems like Russia is taking its own rhetoric about fighting the terrorists in Syria so as not to have to fight them in Russia itself seriously. That said, I still support it, though I now have major reservations about the dangers of overextension.

If there is no further substantial US intervention, I expect Syria to be eventually divided between the Syrian government west of the Euphrates, and Kurdistan east of it, maybe by 2019-20. They will come to some kind of confederal arrangement. If however the neocons win out and move forwards with HRC’s no fly zone ideas, who knows what will happen. Nothing good, that’s for certain.

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What’s the general sentiment towards Germany? What do Russians think about Germany today and how much did the feelings towards Germany change after our relations took a change for the worse recently? Also, what do you think would need to happen to better the German-Russian relations?

(1) Were generally good until 2014. I can’t find polls on Levada, but I would imagine Russian opinion of Germany tracks that of the EU, which was consistently higher than opinion of the US, but converged after 2014.

(2) AfD comes to power in Germany. Khodorkovsky comes to power in Russia.

More realistically, if the US goes full neocon and goes gallivanting on Middle East adventures again. There are committed Atlanticists in Germany like Julian Roepcke, but they are still a minority. German assessments of US trustworthiness have already plummeted from ~60% under Obama to close to 20% after Trump (similar to the current figures for Russia), and especially if the SPD takes back power and anyone other than Macron or Hamon win in France, I could just about see the reformation of the Paris/Berlin/Moscow bloc that opposed the Iraq War. Still, it’s a huge longshot.

Thank you! Military misadventures of the US are the most realistic possibility for an improvement in my eyes, too. But such an outside influence wouldn’t be a very substantial one and also may only be short lived.

Still, it’s a bit paradox that while the “West” seems to be united in its condemnation of and mistrust towards Russia, Germany is building NordstreamII and some german lower rank politicians like Seehofer keep traveling to Moscow, seemingly to keep relations from dropping too low. I think Germany is caught in the middle, having to appease its main and most influential ally, the US, while trying to maintain some contact with Russia and access to the Russian market on which can be build upon in the future, if the situation improves and allows for it.

A last note on why I asked my question… I was very moved by Putin’s speech at the German Bundestag in 2001  and felt like the vision of a shared EU/Russian market, common security policy and general cooperation between the EU and what is now the EEU would have been a true path to stability and prosperity for our region and most of the world and it saddens me very much that this vision is more or less dead now.

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What do you think of use of military force to achieve Russian goals? Syria seems to me to be a success, regardless of many possible concerns, however instances like Georgia and Ukraine seem to be very much a mixed bag. In short – was it worth it, and was there a viable alternative?

Georgia – Russian peacekeepers were directly attacked, no choice but to respond forcefully.

Ukraine – Crimea was an undisputed success that saved it from Donbass’ sad fate. If anything, a timely Russian large-scale intervention in early 2014 would have resulted in far fewer overall deaths and suffering.

Syria – See here.

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Technology

Will Russia return to the cutting edge of space exploration (and/or exploitation, colonization, etc.) technology in the near future?

How does the Russian military stack up against the US and China when it comes to the space domain?

No. In fact, I expect Russia to continue slipping behind.

Ultimately, there is only so much $3.5tn economy and $3bn Roskosmos budget can sustain versus a $20tn economy (USA, China) and a $35bn NASA budget/$6bn and rapidly growing Chinese space budget.

That said, I don’t expect space colonization to occur on any substantial scale in this century, Musk’s rhetoric regardless.

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As a transhumanist myself I don’t really understand how transhumanism and nationalism mixed together in you. The idea of transhumanism transcends the ideas of nations, races and even the human nature. Technological evolution should unite the humanity and as long people become more and more connected today with each other – the ideas of national goverments and nations will be rendered oblosete with time.

Good question.

Very legitimate one, of course. I am sure that once we get to computer superintelligence or CRISPR ourselves up to 175 average IQs, the world will become thoroughly cosmopolitan (support for tolerance, open borders, free trade, etc. tends to increase with IQ).

Problem #1 – developing those technologies takes brains. Elite brains. “Smart fractions,” as they’re known in the psychometric literature. As well as the appropriate technological growth-friendly institutions, which again need a certain level of average national IQ to maintain.

Problem #2 – the evidence suggests that mass immigration from the Third World has negative effects on average national IQ. There is also good recent economic research that suggests that immigrants tend to carry over their home country cultural attitudes, with negative impacts on the quality of institutions in the host countries. See Garett Jones.

Can you envision the US or Japan (average IQ ~100) launching a singularity? It doesn’t seem entirely implausible.

Can you envision Brazil or Indonesia (average IQ ~85) launching a singularity? Sub-Saharan Africa (average IQ ~70)? Seems rather less likely.

As the neoreactionaries say, you can’t cultivate gardens without walls. We don’t know what kind of smart fraction ingenuity would be necessary for the biosphere to complete its transition into a disembodied noosphere. As such, it makes sense to play it safe.

Thank you for broad answer! Technological singularity is my dream. I wish would live long enough only to see the start of it. I have limited knowledge about general AI and even less about gene alteration technology, but guts of the computer engineer say that achieving artificial or virtual intelligence is faster way to help humanity to solve difficult problems. Only after development of such system humanity would reach the level when they will “gene-engineer” the humanity itself. Putting it simply – be smart enough to become smarter first and use this knowledge later.

Sometimes I think that sometimes society and technology develops way ahead of human basic behavior – eat, dominate and multiply – and that creates problems we have worldwide.

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Economics

Russia’s economic growth 2000-2008: how much is luck and how much is sound fiscal management/ macroeconomic policy? I find this to be a fundamental question when it comes to assessing Putin’s legacy.

Russia’s future economic growth: will Putin be able to deliver solid numbers or do you agree with me that the preferable route for Russia going forward would be to be led by liberal reformists such as Medvedev/Kudrin?

EEU: Does it make sense for Russia economically? Should it continue to be pursued for geopolitical purposes? Bonus: should Russia seek closer ties with Europe or do it’s own Eurasian thing?

Also, do you share my assessment that Putin’s domestic policy since 2008 of increased authoritarianism etc has been a bad thing and that there is a need for a change in direction?

(1) Russia did about average for the ex-Soviet region – much better than Ukraine, Georgia, Moldova, most of the Central Asian states; about the same as two of the “Baltic tigers,” Latvia and Lithuania; and worse than Estonia, Belarus, Kazakhstan, and Azerbaijan.

Oil production in the latter two greatly increased relative to the peak Soviet period, whereas Russia’s only recovered to where they were. It might have done better without hasty corruption-wracked privatizations; even star reformer Poland didn’t rush with them, and they did very well. Even just doing what Belarus did would have probably been better. Their GDP stopped falling around 1995. OTOH, it wasn’t a total disaster like Ukraine. I don’t know if the Estonian example is extendable to Russia given its status as a tiny entrepot.

(2) What does “reform” even mean? Russia is now 40th in the World Bank’s Ease of Doing Business ratings. I call that successful reform.

Then there is the “cult of reform” which involves installing pro-Western yesmen into power for a temporary bump to the stockmarket in return for selling state assets for pennies on the dollar, unilateral geopolitical concessions, etc.

Kudrin once went on record calling on Russians to drink more vodka for the good of the budget. Vodka bingeing is the leading cause of premature mortality in Russia. I don’t think Russia needs “economic geniuses” like that, regardless of the opinions of Davos bugmen.

(3) I supported the EEU when it appeared to be something around which Russia could return to its older borders through peaceful economic integration. Since then it has started to look more like a mechanism to send cheap labor to Russia, styming automation, suppressing wages, helping Central Asian sovok dictators stay in power, and perhaps eventually turning Russia into Greater Turkestan. I support a wall with Central Asia and the regathering of the Russian lands.

(4) “Bonus: should Russia seek closer ties with Europe or do it’s own Eurasian thing?”
Meaningless question. Whoever speaks of Europe is wrong. Europe is a geographical expression. – Bismarck. For instance, even today there are huge differences in attitudes towards Russia, from Russophobic Swedes to Russophilic Italians.

(5) I don’t have any cardinal disagreements with the setup of the Russian political system, though there are certainly many specific points of disagreement (e.g. the lack of a clear succession mechanism; the undeniably high levels of corruption within the elites; etc).

Thank you for the reply.

1) This does not really answer my question. Basically, how much credit can Putin take for Russia’s fast economic growth? His critics would say he simply “got lucky” as he was able to export expensive oil and gas.

2) I have noted the progress in the “doing business” ranking. However, how significant is this in practice? By “reform”, I mean modernisation and diversification away from energy dependence. The govt seems to have largely failed in this regard – would you agree?

4) Andrei Tsygankov divides Russia’s political class into three ‘schools’: Westernisers, statists and civilisationists. Westernisers (Medvedev, Kudrin etc) perceive Russia as a “European” country and argue that Russia should join the ranks of Western countries and seek closer ties with the EU and disregard Eurasian integration initiatives – essentially, become as “normal” a European state as it can.

5) What about heavy state ownership of the media? On corruption – is it fair to say that Putin does not appear to have done enough? Are you familiar with any of the intricacies of it – ie how difficult would it be to actually “clean up” Russia and get it to Northern European levels of corruption? Saakashvili appears to have managed to do something like this in Georgia, for all his flaws.

(1) The point that I tried to make, perhaps unsuccessfully, is that this is a very hard question that might be impossible to answer without rewinding history. Perhaps Russia could have done a bit better – though not necessarily through “Western approved” methods, as Belarus showed – but it’s also easy how it could have gone considerably worse (see Ukraine).

(2) The ease of business rankings seem to be pretty important in that (a) they are objective, unlike many other indices, such as the CPI; (b) businesspeople pay a lot attention to it; (c) n=1, but it syncs with my own impressions that the Russian bureaucracy has improved, if from a very low base.

Consider diversification practically, instead of as a slogan. Since Russia produces as much oil as Saudi Arabia, diversification away from it is not easy, just as it is not for, say, Norway, or Australia (both fully developed countries with large natural resource sectors). Unlike, say, Saudi Arabia, Russia does have a substantial manufacturing base – comparable in scope to that of France, Italy, India, and Brazil. In my opinion, the problem with the Russian economy isn’t so much that there’s no diversification beyond oil and gas – there is – but that it tends to be technologically underdeveloped.

(4) There is a difference in becoming a “normal European country” (which is good, and something that Russia has been doing anyway, not unsuccessfully as was pointed out by Treisman & Schleifer as early as 2003) and pursuing European integration, which right now is akin to boarding a sinking ship, and was never a realistic option for Russia anyway.
(5) “What about heavy state ownership of the media?”

The (realistic) alternative is ownership by oligarchs who wish their own and pro-Western agendas. Here’s the famous quote on this from Pelevin (only in Russian, unfortunately):

“On corruption – is it fair to say that Putin does not appear to have done enough? Are you familiar with any of the intricacies of it – ie how difficult would it be to actually “clean up” Russia and get it to Northern European levels of corruption?”

Yes, that’s fair. He is far too easy on corrupt members of his entourage. Which, frankly, is most or all of them.

That said, I am very skeptical that Russia can “solve” corruption for a variety of historical (both Tsarist Russia and USSR failed to), comparative (Italy, Greece, etc. haven’t come anywhere near Northern European standards, despite decades of institutional convergence by dint of EU membership), and cultural/biocultural (see hbdchick’s theories on the Hajnal Line) reasons.

Obviously we should aim to become better, but expectations should be kept realistic. I am pretty sure that liberal appetites for corruption are constrained only by their own lack of access to power, not ethics, and besides, Ukraine next door has now – twice! – demonstrated that color revolutions do nothing for improving corruption.

“Saakashvili appears to have managed to do something like this in Georgia, for all his flaws.”
Commented on this here:

“6% of Georgians reported paying a bribe in the past year in 2004, the first year of Saakashvili’s Presidency, and before his reforms could reasonably be expected to have taken effect; in 2013, the last year of his President, it was 4%. An improvement, sure, but not a particularly radical one. Actual opinion polls by Transparency International suggest that lowlevel corruption was not a big problem in Georgia pre-Saakashvili, and its reduction under him could just as easily have been a simple matter of the general withering away of the state’s regulatory agencies under his libertarian reforms. For instance, the near wholesale removal of university tuition subsidies – essential for democratic access to higher education in a country as poor as Georgia – led to a plunge in tertiary enrollment by almost a third relative to the early-to-mid-2000s. Fewer students automatically translates to fewer bribes for grades. These examples can be extended indefinitely: Less contact with the state automatically leads to “lower” corruption. That doesn’t necessarily mean it’s “good” in all cases.”

Share of exports does not equal level of dependency. Natural resources may make out a large part of Norwegian exports, but they siphon only a very small percentage​ of this income into the state budget (<4% per annum). Russia has clearly taken a bigger hit from the recent crisis than many other energy exporters.

It seems I may have fallen prey to the myth of Saakashvili’s ingenuity on this front. How come Georgia’s level of corruption was already so low? Did they not go through the same decade of looting during the 90’s? In any case, does Georgia’s relative similarly to Russia (in terms of history and culture) not suggest that Russia should be able to reach a similar level?

The revelations by Navalny suggest something bordering on complete apathy towards corruption on the part of the Russian elites, wouldn’t you agree? You don’t really see the same level of – let’s face it – looting among the leaders of less corrupt countries. This leads me to suspect they are ultimately responsible for the high levels of corruption.

On the topic of inequality – I assume you agree it is a significant problem in Russia. Do you see any remedies for it? Would you favour additional Khodorkovsky-style, let’s call it, “acquisitions” by the state? Russia appears to be in quite a unique position in that it could massively improve its level of inequality by dealing only with a few select individuals. Again, my suspicion is that the political elite much prefers the current situation, wherein it enjoys free access to these looted assets.

I wasn’t aware there was any unified consensus on what exactly constitutes oil & gas dependency (i.e. share of the budget, share of exports, share of GDP, or some combination of the three).

But speaking of the budget… The share of oil & gas in the consolidated budget is now 21%, so I don’t think the situation is exactly catastrophic. Ultimately, despite the recent collapse in oil prices, the Russian budget has avoided slipping deep into the red.

I don’t think Georgia is similar to Russia at all. It is Orthodox Christian, but otherwise they speak a totally different language, belong to another (older) civilization, are genetically distinct, etc. It is also much more rural. Don’t think its very extendable to Russia at all.

Re-corruption. Mostly agreed. I would also note that there are different kinds of corruption, e.g.:

• Everyday corruption – high by European standards though not an outlier (not only Ukraine but Romania, Hungary, Lithuania are similar); seems to be constant under Putin.
• Business corruption (e.g. pay to get construction permit) – high by European standards though not outlier; massively improved according to World Bank Enterprise Surveys under Putin.
• Elite corruption – very hard to measure – not exactly like you can poll them on this, like you can random individuals and businesses – but seems to be very high; trends hard to ascertain, though my guess would be that the situation is modestly better than in the 1990s, but hasn’t seen any major improvement under Putin.

Re-inequality. The political elite as such, though wealthy, doesn’t enjoy access to most of those “looted assets.” They mostly belong to the oligarchs who became rich off the 1990s privatizations, and who were explicitly told to stay out of politics (Khodorkovsky disobeyed).

Should those oligarchs be expropriated? I don’t know. On the other hand, it might frighten businesspeople and discourage longterm investment (the standard economists’ argument). On the other hand, it’s not as if they don’t deserve it, and so long as this issue remains unresolved, the consequences of privatization will remain a potential source of political illegitimacy.

I wasn’t aware there was any unified consensus on what exactly constitutes oil & gas dependency (i.e. share of the budget, share of exports, share of GDP, or some combination of the three).

I don’t think one exists, hence my objection to going simply by “share of GDP”.

But speaking of the budget… The share of oil & gas in the consolidated budget is now 21%, so I don’t think the situation is exactly catastrophic.

That doesn’t seem too bad. However, I wonder what the number would be if you included indirect income from the oil and gas sector – ie payroll taxes on employees and even the economic activity generated by their spending (this isn’t measurable, but I’m sure some estimates could be generated). This could be quite significant simply given how much more profitable this sector is than other sectors of the Russian economy.

I don’t think Georgia is similar to Russia at all. It is Orthodox Christian, but otherwise they speak a totally different language, belong to another (older) civilization, are genetically distinct, etc. It is also much more rural. Don’t think its very extendable to Russia at all.

I can see how there are certain differences, but I don’t see why they should result in such a disparity re corruption levels. You also have to factor in the 70 years spent as part of the same union. IQ levels and GDP per capita also point in Russia’s favour in this sphere (though the latter point may be negated by the “resource curse” argument).

I find your distinction between different types of corruption useful. This leads me to believe that “elite corruption” (what I guess you could also term “inequality”) is the real problem here. This, coincidentally, appears to be the domain over which Putin should be able to exert the most influence.

I’m not sure if this is so much about the political elite, in general, as about the small clique surrounding Putin. As Navalny’s most recent work revealed, the oligarchs’ assets appear to be largely at the disposal of this inner circle. For example, Usmanov gifted Medvedev his personal homes and allowed him to stay in his residence​ in Italy. Why give that up?

Even if Putin did want to break the piggy bank this would be an extremely risky (even potentially lethal) project, as the remaining guys would do anything they can to protect their assets. However, desperate times call for desperate measures and Putin will need to maintain his “performance legitimacy” somehow.

It will be interesting to see how Putin’s popularity develops going forward. Any ideas? I assume it can only go so low post-Crimea, but the lacklustre economic predictions are not very reassuring. Absent regular foreign policy victories (which is hardly a reliable political strategy despite recent successes), I suspect there may be clouds lining up in Putin’s horizon. If there’s one thing Navalny’s documentary showed, it’s that people are eyeing the oligarchic piggy bank and they may grow increasingly unhappy with Putin if he does not let more of its contents flow into their pockets.

I kind of do and kind of don’t buy the economic argument against re-acquisition of assets. On the one hand, I believe it could be done in a way that would clearly single out the top 6-7 cats. These would be distinct from foreign investors in that they will be natives and their assets will have formerly belonged to the state and often be related to natural resources. On the other hand, I guess you can always trust clueless foreign investors with zero local knowledge to completely fail to understand what’s going on and proceed to get their panties in a twist.

Sure, the indirect effects of the oil & gas sector certainly has positive downstream effects – certainly inflates consumption to some extent – though of course similar considerations would apply to all large per capita oil & gas exporters.

Pretty much agreed with everything you say about corruption here. that seems to describe reality.

I am actually quite optimistic about economic growth in the next 5 years, barring any major political or geopolitical shocks. We’ve had a two year period of gloom, but this period also saw a tight monetary and fiscal policy, the taming of inflation, and a demographic shock as the numbers of workers entering the labor force plummeted (minimum fertility in Russia was in 1999). But the negative aspects above should attenuate soon, while the positive ones stand the Russia economy in good stead for a strong recovery in the near future.

I’m not categorically against re-appropriation. As you say, it’s not entirely obvious that the reaction will be all that bad, and certainly few people would feel sorry about the likes of Usmanov or Abramovich getting their (belated) just desserts.

I did not think of the demographic factor. I wonder if it will be sufficient to bring about decent growth figures. I wish I shared your optimism, but I feel like significant structural changes are needed to see anything above 2% growth.

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Which sectors you believe are likely to become future drivers of Russian economy?

Probably the current mainstays: Oil & gas, steel, the military-industrial complex.

I am actually pretty pessimistic on the long-term prospects of the Russian economy, though not for the usual reasons such as demographics and corruption. Automation in manufacturing is extremely low, scientific output is minimal however you try to measure it, on virtually any hi-tech metric from numbers of supercomputers to numbers of high-thoroughput sequencers, Russia is on the level of small European countries like Sweden and Switzerland.

Despite a few areas of excellence such as nuclear power, Putin’s preference for football stadiums (and the Rotenbergs’ wallets) over R&D funding is increasing Russia’s technological lag, and I’m concerned even the MIC will simply be unable to compete with the likes of the US or China past c.2025.

Considering Putin’s past job of “acquiring” foreign technology in the DDR, he must be aware of Russia’s technological weakness.

What are the prospects of reindustrialisation and foreign investment in Russia considering the collapse in oil prices, Western sanctions as well as more positive economics aspects such as a cheaper Ruble and turning to non-Western sources of investment.

Edit: How well will raising trade barriers work for encouraging domestic manufacturing like how agriculture is benefitting now.

He’s no doubt aware of it, and has even said as much (recall the nanotech initiative back around 2008? Or his promise of 20mn (?) hi-tech jobs in 2012? There was also, of course, Skolkovo. But none of these seem to have been particularly successful to my knowledge. Rosnano was handed over to Anatoly Chubais (LOL), who I think preceeded to invest most of it in Western startups, perhaps after skimming some off for himself.

I don’t know what Russia can do to change to radically improve the situation. Even the East-Central European states that have integrated with the EU haven’t developed strong hi-tech sectors; neither has Mediterranean Europe. It’s something that remains largely confined to the US, North-West Europe, Japan, and increasingly, China. Maybe its just a combination of superior human capital and/or institutions.

However, less money on show-off sporting events and more money for R&D would surely be a good start. There’s also a huge amount of bloat and corruption in Russia higher education, from university rectors to paid-for dissertations (they constitute approximately 10% of the total according to the Dissernet plagiarism detection organization). This must be tackled, but with Putin himself being the recipient of a fictive PhD, not to mention a good percentage of the Russian elites, that probably isn’t going to happen anytime soon.

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