In its exuberance, the Kremlin sent limited Russian special forces without insignia into much of eastern and southern Ukraine to arouse unrest. In one appearance on April 17, 2014, Putin presented Russia as the defender of the rights of ethnic Russians and Russian speakers in a “Novorossiya,” reviving an old, long-forgotten tsarist concept:
The essential issue is how to ensure the legitimate rights and interests of ethnic Russians and Russian speakers in the southeast of Ukraine. I would like to remind you that what was called Novorossiya (New Russia) back in the tsarist days—Kharkov, Lugansk, Donetsk, Kherson, Nikolayev and Odessa—were not part of Ukraine back then. These territories were given to Ukraine in the 1920s by the Soviet government. Why? Who knows. They were won by Potyomkin and Catherine the Great in a series of well-known wars. The center of that territory was Novorossiysk, so the region is called Novorossiya. Russia lost these territories for various reasons, but the people remained.62
Even at this moment of exuberance, Putin was careful not to go all out as a neo-imperialist, and he soon dropped the term Novorossiya. He continued with a caveat: “The key issue is providing guarantees to these people.” The Kremlin-instigated uprising failed except for in parts of the two most eastern provinces of Luhansk and Donetsk, but when the Ukrainian military carried out a major offensive against the separatists and Russian volunteers, the Kremlin sent in regular Russian forces in July, safeguarding the separatist territory and causing Ukraine major losses.63
The hot war in eastern Ukraine has continued. Russia has used all conceivable unconventional military means, including insurgency, sabotage, disinformation, trade war, economic sanctions, and cyber in Ukraine. It has tested its considerable nonconventional capabilities that can reinforce its military might.
Putin had gone full circle from a pro-Western stand to a staunch anti-Americanism. With his intervention in Ukraine, he had alienated the United States, the European Union, and all the former Soviet republics. Russia has become marginalized, having little but China, India, the Middle East, and Venezuela to turn to.
Like all successful authoritarian leaders, Putin devotes great attention to his law enforcement agencies, and he has nurtured their strength as well as their competition. Major changes of personnel and organization are rare, but when they occur, he has acted fast and hard.
Putin’s two favorite agencies have been the FSB (the domestic arm of the old KGB) and the FSO (the presidential security arm of the old KGB). Top Putin loyalists have headed these two agencies, and Putin has poured resources and privileges on both organizations. While the FSO is a small elite force, the FSB has grown very large. The FSB continues to operate throughout the former Soviet Union, and in recent years it has also been allowed to expand abroad, previously the territory of the foreign intelligence agency, or SVR.
In the Soviet Union, the foreign intelligence main directorate of the KGB competed with the military intelligence directorate, the GRU. In 1991, Yeltsin cut the foreign intelligence directorate off from the KGB, forming the SVR. The SVR and GRU continue their rivalry, and both agencies are considered highly competent. The much stronger FSB, however, has entered this competition abroad.
The Ministry of Interior led the Soviet police force. It was generally seen as corrupt and incompetent, which is still the case, and it is outflanked by all other branches of law enforcement in official ranking and resource allocation. Putin waited until April 2001 to replace the ministers of interior and defense, who were not his people. Since then, Putin has enjoyed great control over all law enforcement agencies.
The Prosecutor General’s Office has long been accused of extensive corporate raiding. In January 2011, its investigative arm was made independent as the Investigative Committee under the leadership of Putin’s friend from law school and St. Petersburg KGB Alexander Bastrykin. These two organizations have competed in predation, leaving businesspeople their victims. None of them wants to abandon their rich loot.64
In April 2016, Putin ambitiously created a National Guard of four hundred thousand paramilitary security forces. He put it under the command of his longtime chief bodyguard General Viktor Zolotov, while retiring a whole row of old KGB generals. Most of the National Guard’s 400,000 troops were taken from the Ministry of Interior. While its public aim is to fight terrorism, its formation has been seen as a preparation to fight domestic opposition.65
Russia has many law enforcement and security agencies with vast resources and power. A standard practice of Russian law enforcement agencies is to detain businesspeople for pretrial detention on the flimsiest of grounds to shake them down. In 2010, the Washington Post reported that “according to court records, 404,333 people were convicted of economic crimes, but only 146,490 received prison terms. The rest paid fines or got suspended sentences. At the same time, 59 people died in Moscow’s pretrial prisons, half a dozen more than the year before.”66
One of the most notorious, and best-investigated, cases is that of the lawyer Sergei Magnitsky, who accused officials of having stolen $230 million from the tax authorities. Instead, Magnitsky was charged by those same officials for their crime, and in 2009, he died in pretrial detention in Moscow’s Matrosskaya Tishina prison at the age of thirty-eight under dubious circumstances. Thanks to the fund manager Bill Browder’s exposure of this case, the US Congress adopted the Sergei Magnitsky Rule of Law Accountability Act in December 2012, under which a total of forty-nine Russian culprits have been sanctioned. One of the offenders sanctioned by the United States was the head of the Investigative Committee, Putin’s law school friend from St. Petersburg Alexander Bastrykin.
The Magnitsky case illustrates how Russian law enforcement agencies persecute businesspeople on a large scale and how sadly absent their protection is. In December 2016, the US Congress adopted the Global Magnitsky Act, and in December 2017 the US Treasury named the first designations. The only Russian on that list was Artem Chaika, son of the Russian prosecutor general Yuri Chaika. Young Chaika had been exposed as a major organized criminal using his father’s subordinates for his extortion of enterprises from innocent victims in a film by the anticorruption activist Alexei Navalny in December 2015.67
Putin has repeatedly complained about how the police deal with business. In his annual address to the Federal Assembly in December 2015, he embraced free market values: “I believe free enterprise to be the most important aspect of economic and social well-being. Entrepreneurial freedom is something we need to expand to respond to all attempts to impose restrictions on us.” He went on to pronounce his harshest critique ever of lawless law enforcers:
During 2014, the investigative authorities opened nearly 200,000 cases of so-called economic crimes. But only 46,000 of 200,000 cases were actually taken to court, and 15,000 cases were thrown out during the hearings. Simple math suggests that only 15 percent of all cases ended with a conviction. At the same time, the vast majority . . . 83 percent of entrepreneurs who faced criminal charges fully or partially lost their business—they got harassed, intimidated, robbed and then released. This certainly isn’t what we need in terms of a business climate. This is actually the opposite, the direct destruction of the business climate. I ask the investigative authorities and the prosecutor’s office to pay special attention to this.68
Anybody reading these lines would presume that the president intended to change policy, ending the laissez-faire policy toward the law enforcement divisions to discipline them, but he did not indicate any follow-up. While 212,316 criminal cases had been opened against businesspeople in 2014, the number rose to 255,250 in 2015. Although Putin continued to promise defense against the “law enforcers,” he allowed the corporate raiders to continue to indulge in the riches of Russia’s private entrepreneurs. By attacking the Magnitsky Act, he defended them.69
As Jordan Gans-Morse concluded in his fine empirical study of property rights in Russia: the country has reversed itself from a certain degree of the rule of law to “state predation.” The organized crime of the
early 1990s was defeated in the mid-1990s, and a relative rule of law took hold in the early 2000s, but that has now given way to state predation.70
In February 2016, the prominent business newspaper Vedomosti sadly noted that “the fundamental problems of the interaction between law enforcers and business—the absence of guaranteed property rights, as well as independent and just courts, and the corporate raiding of law enforcement—have been preserved, and the current crisis has grown worse.”71
A Russian journalist observed in 2014 that “paradoxically the more successful a business is, the greater are the risks.” A survey by the global accounting firm PwC showed that 57 percent of Russia’s businesspeople wanted to sell their firms, as compared with 17 percent in Europe as a whole, clarifying the dismay of Russian entrepreneurs. In the years 2009–2013, no fewer than 670,000 cases were opened against Russian businesspeople for “fraud.” Of these just 146,000 went to court. This small share indicates the prevalence of corporate raiding or extortion.72
Nor does a court sentence necessarily imply guilt in Russia. In 2017, a survey among managers of big and medium-sized enterprises showed that almost 60 percent of the managers reckoned that in a conflict with a bigger company their only defense would be official administrative support, showing no trust in the law or the courts. When Medvedev was president, 2008–2012, he had two laws adopted to stop this practice, but they had little impact. Repeated official proposals to curb pretrial detentions of businesspeople, for example, by the Supreme Court in 2016, have had no effect.73
By defending his law enforcement agencies against accusations of corruption more frequently than he criticizes corruption itself, Putin shows that he accepts this behavior of Russia’s purported law enforcers. Rather than trying to rein them in, he continues to expand their powers. In May 2017, Putin issued a decree that entitled the FSB to “take decisions within its authority regarding seizure of land and (or) property . . . for the needs of the Russian Federation.” Nothing was said about possibilities for private individuals or companies to appeal if the FSB confiscated their property. This is reminiscent of Ivan the Terrible’s exceptional rule, or oprichnina, in the sixteenth century, when he let the secret police carry out mass repressions and confiscate land from the aristocrats.74
In 1996, Russia joined the Council of Europe, an all-European interparliamentarian body that promotes human rights, democracy, and the rule of law, because Yeltsin had such an aspiration. It has fifty-seven members and is separate from the European Union. Its court, the European Court of Human Rights, verifies whether a member country complies with its own laws. Soon Russia became a major customer with thousands of cases every year, and it validated its verdicts. In 2015, however, Russia’s Constitutional Court decided that it would no longer do so. The tipping point was a 2014 decision by the European Court of Human Rights to award shareholders of the now-defunct oil company Yukos Ä1.9 billion in compensation.75
The practically unlimited powers of the Russian law enforcement agencies are a foundation of the Putin system. The competition among the law enforcers has been intense, but currently the dominant verdict among Russian experts is that the FSB has gained the upper hand against the other agencies. If their rivalry goes too far, it could cause a destabilizing split among the security forces.76
The old adage remains valid that the severity of Russia’s laws is alleviated by the state’s inability to enforce them. The FSB wants to be omniscient and perfectly informed, while repression is quite limited. Dozens of Russian journalists have been murdered, but human rights organizations count only just over one hundred political prisoners in Russia, though the many people sentenced for or in pretrial detention for economic crimes form a large gray group. The political situation is reminiscent of the pre-perestroika years, when many intellectuals went into “internal exile,” avoiding politically sensitive topics, indulging in culture instead. Moscow’s theaters are flourishing.
The scholar of Russian intelligence services Mark Galeotti has summed up the situation: “Moscow has developed an array of overlapping and competitive security and spy services. The aim is to encourage risk-taking and multiple sources, but it also leads to turf wars and a tendency to play to Kremlin prejudices.” An illustration of this rivalry is that the US authorities accused both the GRU and the FSB of having hacked the Democratic National Committee in 2016, presumably in independent competition. Galeotti argues that this is a reflection of the FSB expansion abroad, the decline of the SVR, and the competition between the intelligence agencies.77
The FSB and FSO are the two top elite services favored by Putin in high state appointments. An additional force is the kadyrovtsy, the independent security forces of Chechnya’s president Ramzan Kadyrov, who operate also in Moscow, indulging in violent crimes to the great irritation of the FSB. Symptomatically, five members of these forces were sentenced for the February 2015 murder of Boris Nemtsov.78
Putin’s rule has been characterized by far-reaching deinstitutionalization. Many state bodies that used to be important are no longer relevant. During his third term, Putin largely abandoned collegial consultations.
Previously, the council of ministers made most economic policy decisions, but since the weak Dmitri Medvedev chairs this council, Putin prefers to make decisions in meetings with a limited group of ministers or one-on-one between him and a CEO of a state company or a minister, as is regularly reported on his website.79
The Russian parliament, the Federal Assembly, has become a mere transmission belt for the government’s legislation. The real legislative work takes place inside the ministries and the presidential administration. Because the president appoints regional governors, regional governments have little freedom. Putin spends a lot of his time meeting governors one by one.
The only relevant official collegial body is the Security Council, which appears to have become the new Politburo. Its meetings are always chaired by Putin. Its twelve permanent members generally meet slightly more often than every second week, usually in the middle of the afternoon on a Friday or Thursday, though their meetings can take place at any time, as it suits Putin. During the first half of 2018, the Kremlin website reported fourteen meetings of the permanent members of the Security Council.80
Eleven of the permanent members are there ex officio: President Putin, Prime Minister Medvedev, Chairman of the Federation Council Valentina Matvienko, State Duma Speaker Vyacheslav Volodin, Head of the Presidential Administration Anton Vaino, National Security Council Secretary Nikolai Patrushev, Foreign Minister Sergei Lavrov, Interior Minister Vladimir Kolokoltsev, Defense Minister Sergei Shoigu, Director of the Federal Security Service (FSB) Alexander Bortnikov, and Director of the Foreign Intelligence Service (SVR) Sergei Naryshkin. Curiously Putin’s former chief of staff, Sergei Ivanov, is still a permanent member, even though he was demoted to special presidential representative for environmental protection, ecology, and transportation in August 2016. Half of the permanent members are generals.81
An oddity is that Putin’s favorite and long-time chief bodyguard, General Viktor Zolotov, is not a permanent member but a mere member of the Security Council. In early April 2016, Putin appointed Zolotov commander of the newly formed National Guard and a permanent member of the Security Council by decree, but a few days later this decree was amended, excluding Zolotov. For months, a disparity prevailed. Putin’s website claimed that Zolotov was a permanent member of the Security Council, whereas the website of the Security Council did not list him. After several months, Putin’s website dropped Zolotov. To judge from the official Kremlin bulletins, Zolotov has never attended a meeting of the permanent members of the Security Council.
Both these circumstances raised eyebrows. Until 2016, Sergei Ivanov was widely seen as Putin’s deputy, so both his demotion and his tenacity on the Security Council are noteworthy. It is also remarkable that Putin cannot appoint the general widely seen as his favorite to the Security Council. Is Putin fully in charge of the Security Council, or is it
a real collective decision-making body? The evidence suggests the latter.
Each time the Security Council meets, it issues a brief statement about who has attended and what topics were discussed. It meets before all major international events and discusses primarily foreign policy, but often the members also discuss “current issues of the domestic socioeconomic agenda.” Thus, the main economic decisions are being made without any economic official at the table.82
The Security Council is reminiscent of the old Soviet Politburo, which ruled the Soviet Union. It met more regularly, once a week, always on a Thursday, and had about a dozen full members along with candidate members. It even issued similar bulletins about what topics it had discussed each time. It was the Politburo that ousted Nikita Khrushchev in October 1964 and launched a failed coup in August 1991.
If any top-level body can threaten Putin, it is the Security Council. The Kremlin, which was quite open in the 1990s, is now closed, and much of the information that slips out is disinformation. As in Soviet days, researchers need to turn to hard data such as official photos, statements, appearances, and appointments. Two recent periods of top-level crises have been apparent. One was immediately after the murder of Boris Nemtsov on February 27, 2015, after which Putin did not appear in public for ten days. The other was in August 2016, when Sergei Ivanov was removed as head of the presidential administration.
During his eighteen years in power, Putin has accomplished an impressive consolidation of power. He has built up a centralized personal authoritarian system. He has toyed with multiple values, but they are too many and contradictory to be taken seriously. His statements about ideas appear more like opportunistic image-making. Putin’s two central goals appear to be political power and the enrichment of himself and his friends.
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