Fiscal woes and political infighting now blunting the Russian bear's claws


A sliding economy sees more Russian citizens criticising government, writes Megan Stackin Moscow

THIS IS no grand reinvention, just a subtle aggregation of small, surprising gestures. Still, recent conciliatory signals from Moscow are enough to make analysts believe that prime minister Vladimir Putin’s Russia, the cash-rich, oil-soaked country that railed against the West while shutting down political opposition at home, is groping for new footing under heavy fiscal pressure. Chastened by a stumbling economy and strained by political infighting, Russia has been sending out softer signals, both at home and abroad.

There was Putin’s appearance in Davos last week, where he startled the crowd with a speech extolling the virtues of open government and economy.

Back in Moscow, the Kremlin sent rare invitations to the editor of the outspoken Novaya Gazeta newspaper, along with former president and glasnost symbol Mikhail Gorbachev. The pair met Russian president and Putin protege Dmitry Medvedev, who expressed his sadness over last month’s brazen slayings of a prominent human rights lawyer and Novaya Gazeta reporter – and emphasised the importance of dissenting voices in the media.

Meanwhile, Moscow signalled a willingness to open a badly needed supply route through Russia en route to Afghanistan, allowing Nato forces to bypass the risky path through volatile Pakistani territory.

“The logic here is very simple: The less money you have, the less arrogant you can be,” says Dmitry Oreshkin, senior analyst at Moscow’s Institute of Geography.

Few people here talk seriously about the possible fall of Russia’s top leaders. Their hold on power structures such as intelligence services and business elites remains firmly intact, and their street popularity is still relatively high. Moreover, a pall has been cast on the season by the unsolved deaths of lawyer Stanislav Markelov and journalist Anastasiya Baburova, gunned down in broad daylight near the Kremlin. The year began with the denial of fuel to shivering swathes of Europe as Russia quarrelled over natural gas prices with neighbouring Ukraine.

But the air of invulnerability and diplomatic swagger that once surrounded Putin has begun to fade as his government grapples with falling oil prices and dwindling gold and currency reserves. A plague of unemployment, factory closures and delayed salaries is sweeping the country, and public discontent is creeping higher.

The government needs plenty of cash to hold up its end of the social contract struck between Putin and ordinary Russians – the promise of steadily improving living conditions in exchange for unquestioning political support. But with the economy tanking, Russia anticipates a budget deficit this year.

The sudden shortfall threatens more than just popular support. Analysts say scattered economic demonstrations rattle the government, not because they are spontaneous eruptions of public discontent, but because they are endorsed and orchestrated by local authorities, particularly in Russia’s far eastern provinces.

“These are people who understand how the system works in Russia, and they are very worried about how to keep the various elites in line,” Oreshkin says. “What we can call the ‘Putin consensus’ of elites was maintained only at the expense of a huge flow of oil money.

“Now the money is running out, and it’s a problem.” Tension among the powerful is also blamed for cracks in the heretofore unruffled relationship between Putin and Medvedev.

This winter, Medvedev began to criticise “the government” – a clear reference to Putin and his cabinet – for an inadequate response to the financial crisis.

“We maintain good and friendly relations, but this does not mean that the president should turn a blind eye to the existing problems,” Medvedev said last week when Bulgarian reporters asked about Putin.

Receiving his visitors last week in the onetime office of Josef Stalin in the Kremlin, Medvedev spoke in favour of press rights, said Dmitry Muratov, editor of Novaya Gazeta.

“He said there’s nothing to love our paper for, but he has to read and respect the criticism in it,” Muratov said. “He listened intently to Gorbachev and myself, and we felt he was a man deeply interested in the conversation.”

Medvedev also called for a redraft of Putin’s most controversial Bill, which had broadened the legal definition of treason to such a degree that incensed human rights and aid workers have expressed fears that they would be charged as spies for criticising the government or mingling with foreigners.

Some observers are leery of reading too much into the appearance of a rift between the two leaders. The pair may simply be angling to soothe fears of a crackdown by providing Medvedev greater leeway to speak out. But with economic woes deepening, others argue that Putin has found himself in the traditional scapegoat’s seat: the prime minister’s office.

“Medvedev does understand the situation in the economy is dire, and he’s trying to distance himself from the prime minister, who is responsible for the everyday economy. They are afraid, and I think Medvedev understands the risks involved,” says Yevginiya Albats, editor of the investigative New Times magazine.

Meanwhile, “there are plenty of people around Medvedev who would like him to become a real leader as opposed to a puppet of the prime minister,” Albats said.

Some analysts believe that Medvedev’s subtle complaints have sent a signal that criticising Putin is now fair game. Last week, a lawmaker from the pro-Kremlin A Fair Russia party struck out at Putin’s government from the floor of parliament. “The government never has and still does not have a complex, systematic anti-crisis plan,” complained lawmaker Oksana Dmitriyeva in comments carried by Russia’s privately owned Regnum news agency.

“People are realising they can do this, that this possibility is open,” Oreshkin says. “Nobody calls Putin by name, but you can criticise the government. That’s the first step.” – ( LA Times-Washington Postservice)