
A Peasant Leaving His Landlord on Yuriev Day, painting by Sergei V. Ivanov (my favorite Russian painter)
SPECIAL REPORT | RUSSIA: "Caught between modernity and chaos: The latest terrorist attack on the capital is a reminder of the forces that threaten the country's ambition," by Charles Clover, Financial Times, 14 April 2010.
Another piece from Clover suggesting the necessary rule-set reset for Russia after the worst terrorist strike in six years--namely, the move away from the sort of revived feudalism of the late Putin age:
In some sense, the bombings are a verdict on the Kremlin's model of rule n this southern, mountainous, and mainly Muslim rim. By supporting strong warlords, who pay loyalty to the Kremlin in exchange for a free hand to rule as they see fit, the local population has been alienated by corruption and brutalized with impunity. Fighting, some say, is the last resort of the desperate.
Something to consider as we try to cut our deals with the Taliban in Afghanistan. I mean, is the Russian model here all that different from Pakistan's WRT the federally-administered tribal areas?
But this is part of the larger, late-Putin trend of mandating selection of local rulers by Moscow but then granting them a feudalistic free-range ruling style:
This semi-feudal model of rule is not unique to the troubled southern republics, but is applied with variations across Russia's 83 provinces and autonomous regions. Governors are appointed, and few questions are asked, so long as they deliver stability and loyalty. Largesse from an oil-fuelled state budget that is 40 per cent of the country's GDP has bought both.
Naturally, the lowering of global oil prices has cut into this social contract, such as it is, thus the rise of recent local protests against Moscow's distant rule--a very old theme in Russian political history.
The big trigger is the usual one: the middle class feels threatened"
"A year ago the middle class had savings," says Gleb Pavelovsky, a political consultant to the Kremlin, "but today the savings are practically exhausted. This is a situation we have not been in for 10 years."
Russia still has plenty of intellectual assets beyond the energy: "It is a world leader in many high-tech sectors, such as aerospace and armaments." But suffering from "legal nihilism," as Medvedev puts it, the government is awash in corruption and so FDI is weakened and "this exacerbates a pattern of chronic underinvestment that has plagued Russia since before the end of the Soviet Union."
In short, the economy is geared toward consumption, whether you're talking private consumption over savings or government exploitation of known energy resources over further development of the same.
Medvedev talks of needed modernization, but it is a still-born notion so long as Putin remains co-ruler. Thus the muddle-through option that defines much of Russian history remains operative until word comes definitively from Putin as to his plans in 2012.
Putin prefers a non-competitive environment in which his state-run companies and those piloted in the private sector by his cronies can dominate. So long as that remains the case, Russia's economy will remain more cannibalistic than innovative.