Vladimir Putin does not look like a man who smiles often, but he must have had a good laugh to himself last week after announcing that he would stand for—and obviously return as—Russia’s President next March. In 2008, due to a Constitutional stipulation restricting a President two consecutive terms, he had handed over his job to close ally Dmitri Medvedev, and become Prime Minister. Now Putin is reclaiming the country and the people he believes it is his right to rule.
What would have made Putin laugh even more was the outrage with which this decision was greeted in Western political circles and media. Commentator after commentator noted that Putin would now possibly be supremo till 2024—the Presidential term is now six years—and that would make his reign as long as Stalin’s. The United States and its allies had liked dealing with Medvedev much more than with Putin—Medvedev had seemed friendlier, more “reasonable”, more liberal. At times, there seemed to have even been indications that he was not just a puppet—he had spoken about police and judicial reforms, against “legal nihilism” and bureaucrats who “terrorise” businesspeople. In March, he had criticised the ineffectiveness of large state-controlled corporations—Putin’s “national champions” which have spearheaded Putin’s industrial policy, and allegedly, made billionaires of Putin and his cronies. In fact, only three months ago, Medvedev told the Financial Times that he would like to run for President in 2012.
But last week, Putin told his United Russia party conference that he and Medvedev had agreed upon Putin’s return to the Kremlin several years ago. The last four years were an elaborate sham. The anti-Putin newspaper Moscow Times wrote: “This behaviour shows all the markings of a megalomaniac who has enjoyed uncontested power far too long. Or a con artist who outsmarted the police and everyone else and can’t resist boasting about it to friends and acquaintances.”
Why is the West so uncomfortable with Putin? The man has a messianic belief in building a “strong Russia”, and that he is the only person who can do it. He has trashed all democratic processes, crushed all political opposition, bullied the world, and contemptuously disregarded global “fair trade practices”—Russia is the only G-20 member which has not joined the WTO. He is implacable, unyielding, and now has shown the world that all power in Russia is concentrated—and will be, for the foreseeable future—in the hands of just one man, something that has not happened since Stalin. (In 2007, Putin called Stalin a cruel but successful leader, and argued that Stalin’s purges paled in comparison to the United States’ bombing of Hiroshima and Nagasaki. )
In 2000, Putin inherited a Russia that was on the brink of collapse. His government fought back fiercely, implementing key economic reforms in taxation, banking, labour and land laws, and tightening fiscal policy. Fortunately for Russia, global oil prices too started rising. The economy enjoyed nine years of sustained growth averaging about 7%. Indeed, from 2001 to 2008, Russia ran a budget surplus, and foreign exchange reserves grew to almost $600 billion by mid-2008, the third-largest in the world. It was hit very hard by the global economic crisis in 2008, but GDP growth has now crawled back, up to 3.8% in 2010, and is expected to hit 4.2% this year.
But the economy remains critically dependent on oil prices, while much of Russian industry is globally uncompetitive—the reason why Russia has not joined the WTO and maintains high tariff barriers on imports. With business dominated by a handful of massive corporations run by Putin’s cronies, there is no reason to believe that he will open Russia up to competition, or be able to diversify and modernise industry. Some economists believe that if oil prices fall below $60 a barrel, Putin could be in trouble.
Whether that proves correct or not, what is certain is that Putin’s life will now be ruled by the immutable law that has held for all dictators. Dictators can never retire. While they rule through fear, they also carry a deep fear inside themselves. Like Stalin—the only other man he can be compared with in post-czarist Russia, in terms of personal power—Putin will now never have the luxury of a peaceful relaxed old age. No succession plan is possible; indeed, by definition, it is unsafe. As a dissident Russian intellectual told Reuters a few days ago: “There is no dacha for Putin anymore. He must die in the Kremlin.”