March 26, 2008

Meet the New Boss, Same As the Old Boss

Yesterday, the FT published a rather lengthy interview/analysis piece focused on the new President-Elect of Russia, Dmitry Medvedev. The man whom nobody (you know, other than Vlad the Impaler) knows had some rather choice things to say. It's a long piece, but it's good.

A few highlights of the article:

{...}Mr Medvedev’s inauguration on May 7 will mark a unique moment in Russian history. For the first time a Russian leader – whether tsar, Communist general secretary or post-communist president – will voluntarily leave office on time and at the height of his popularity. Yet it also heralds the start of a risky experiment. Mr Putin will leave the presidency but stay on as prime minister, in what some see as merely a ruse to remain in power. Others warn it could create a dual-headed power structure, which has spelt instability in Russia’s troubled past.

The president-elect insists the arrangement can work. He describes it as a “tandem”, in which both men understand the division of labour spelt out in the constitution. Mr Medvedev, as president, will set the priorities in domestic and foreign policy. He is commander-in-chief, makes the key decisions on forming the executive, and is guarantor of Russians’ rights and freedoms. The government, headed by Mr Putin, implements policy, especially in the economic arena.

He has much to prove, therefore, not just to the former military and security men nicknamed the siloviki or “men of power”, but to the outside world, where he remains an unknown quantity. Until two years ago, Mr Medvedev was largely a backroom operator, as Kremlin chief of staff. Two stints as chairman of Gazprom, the state-owned energy giant – a position he still holds – will have provided only a hint of the pressures he faces running a country where the political environment is as unforgiving as a Siberian winter.

So how does Mr Medvedev intend to assert his authority? In his first interview since the March 2 election, Russia’s next president outlined his priorities and offered an insight into his political philosophy. Speaking through an interpreter whose English he frequently corrected, he spelt out how he planned to continue Mr Putin’s course while putting his own stamp on how the country is governed. He was clinical and dispassionate in his answers, without the folksy wit or earthy language of his mentor, scribbling occasional words and doodles on a Kremlin notepad.

His starting point is his legal background – he is, he says, “perhaps too much of a lawyer”. Meticulous and precise, he sees almost every issue through the prism of legal thinking. But behind the occasionally laboured language lies a deeper goal. Mr Medvedev says he wants to do what no Russian leader has done before: embed the rule of law in Russian society. “It is a monumental task,” he agrees, switching momentarily to English. “Russia is a country where people don’t like to observe the law. It is, as they say, a country of legal nihilism.”

{...}Mr Medvedev insists Russia can build the rule of law, outlining a three-point plan. The first step is to assert the law’s supremacy over executive power and individual actions. The second is to “create a new attitude to the law”.

“We need to make sure that every citizen understands not only the necessity and desirability of observing the law, but also understands that without [this] there cannot be normal development of our state or society,” he says.

Third is to create an effective courts system, above all by assuring independence of the judiciary. Judges must be paid more and their prestige enhanced so Russian law graduates, as elsewhere, see becoming a judge as the “summit of a legal career”.

Proper law enforcement is also fundamental to tackling another age-old problem that Mr Medvedev has made a priority – bribery. The president-elect is equally severe on the motorist paying off a policeman to avoid speeding fines as on the bureaucrat taking a cut on a business deal.

“When a citizen gives a bribe to the traffic police, it probably does not enter his head that he is committing a crime ... People should think about this,” he says. He also pays lip-service at least to the idea that those at the top of the “vertical of power” Mr Putin has created must set an example themselves. “The only way that Russia can count on having the supremacy of the law is in a situation where the powers-that-be respect the independence of courts and judges,” says Mr Medvedev.

When pressed, moreover, the president-elect signals a break with recent years by saying he will rein in any security and law enforcement services found to be engaged in illegal business. It seems a hint that he may be prepared to confront the siloviki clan – those most unhappy with his elevation to president. Viktor Cherkesov, head of Russia’s anti-narcotics service and a former KGB general, complained late last year that rival security services were fighting between themselves for wealth and influence.

{...}“I am a supporter of the values of democracy in the form that humanity has developed them over the last few centuries,” he says instead. “My definition of democracy as the power of the people is in no way different from classical definitions that exist in all countries.”

In what appears a veiled sideswipe at the US “freedom agenda”, he calls it a “dangerous extreme” to attempt to develop democracy in a country “outside its historic or territorial context”.

“Our democracy is very young,” he says. “It’s less than two decades old. Before this, there was no democracy, not in Tsarist times and not in Soviet times.”

But in words that may be welcomed in western capitals, Mr Medvedev makes clear he gives short shrift to those who say Russia is barren ground for democracy. “Russia is a European country and Russia is absolutely capable of developing together with other states that have chosen this democratic path of development," he says.{...}

Ok, enough with the theory, let's get down to business. Russian business, that is.

Mr Medvedev’s overall thrust is that if Russia’s economy continues to expand, and it can build the rule of law so corruption can be overcome, its democracy will mature into something more closely resembling international models. His biggest priority, he says, is to translate Russia’s oil-fuelled economic recovery into social programmes that transform the lives of citizens.

{...}Mr Medvedev concedes the need for careful marshalling of the economy, but trumpets its strength. Russia’s financial and stock markets, he contends, are “islands of stability in the ocean of financial turmoil”.

“What makes us confident is that over the last eight years we have managed to create a stable macroeconomic system,” he says. “Our financial reserves ... are higher than ever before, reflecting the overall state [of] the Russian economy.”

The president-elect does not say specifically he will reduce the state companies that have proliferated under Mr Putin, which rivals and many economists charge with inefficiency and stifling competition. But he does say they should operate only in certain, limited sectors, for example where essential to the state’s economic security.

“The number of state companies ... should be exactly the number required to ensure the interests of all the country, but no more,” he says. Mr Medvedev also repeats campaign pledges to reduce the number of state representatives – often ministers or senior Kremlin officials – on state company boards and bring in more independent directors.{...}

So, basically, Gazprom and Rosneft will continue to operate as arms of Russian foreign policy, but they're not going to go into trade as haberdashers any time in the near future. Status quo, in other words.

As far as that foreign policy is concerned, well, let the man speak for himself:

“Any effective leader ... has to take care of defending the interests of his country. In foreign relations, you can’t be a liberal, a conservative or a democrat.”

On Russia’s most strained foreign relationship – with the UK – he says it is in Russia’s interests to see an improvement. Gordon Brown, the British prime minister, was one of the first foreign leaders to congratulate him on his election victory, he adds. Economic relations remain “magnificent”, with British investment in Russia totalling $26bn. Bilateral relations, such as co-operation between intelligence services, have been largely “rolled up”, though this is “not a tragedy”. But Mr Medvedev does not shrink from repeating recent accusations that the British Council, the UK cultural body whose offices outside Moscow were forced to close, has been involved in spying.

“The reports I get as one of the leaders of the country show that there is a problem with this,” he says. He deflects suggestions that last week’s detention of an employee of TNK-BP, the Anglo-Russian oil joint venture, might be a bid by security services to sabotage any improvement in UK-Russian relations. In this case, too, he says, his information suggests there is a case of industrial espionage to investigate.

Russia’s next president gives little sign he will adopt a more conciliatory approach to the US, with whom relations have deteriorated sharply. But he says he told George W. Bush, during a call to congratulate Mr Medvedev on his election, that relations might have been even worse were it not for the personal chemistry between the US president and Mr Putin. He holds out some hope of a “legacy” deal with the US before Mr Putin steps down to resolve disputes over US plans to site elements of a missile defence shield in eastern Europe, and over how to replace the Start treaty limiting strategic nuclear missiles, which expires next year. But Mr Medvedev warns that offering Ukraine and Georgia the prospect of Nato membership at a summit next week could undermine attempts to mend transatlantic ties.

“We are not happy about the situation around Georgia and Ukraine,” he says. “We consider it extremely troublesome for the existing structure of European security. No state can be pleased about having representatives of a military bloc to which it does not belong coming close to its ­borders.”{...}

In other words, don't even think about offering Georgia and Ukraine Nato membership, otherwise we'll feel threatened, and you wouldn't like it when we feel threatened. BIG OIL AND GAS RICH HULK SCARED! HULK TURN OFF HEAT IN MIDDLE OF WINTER TO TEACH YOU A LESSON!

So, I suppose the question would be, do we know anything new about Mr. Medvedev? Perhaps. Although, I don't think so. My impression is that he simply told everyone what they wanted to hear. What do western leaders want to hear? That he's all about the rule of law and democracy. Did they get what they wanted? Yes. What does foreign business want to hear? That he'll put and end to corruption, and that the nationalization of industry would, in essence, be stopped in its tracks. (I'm sure Royal Dutch Shell, Mitsui and Mitsubishi feel comforted.) Did they get what they wanted? Yes. What does the nationalist base who elected him want to hear? That he'll stick up for Russia against "western aggression." Did they get what they wanted? Yes.

Meet the new boss. Same as the old boss.

I suspect we'll see what Mr. Medvedev is made of when the cost of a barrel of oil plunges. It will only be then, when he'll be able to cut the puppetmaster's strings, that he'll dare to dance to his own tune. Until that point in time, watch what dear old Vlad is up to, and not Mr Medvedev: it will be a waste of your time to do otherwise.

Posted by Kathy at March 26, 2008 11:00 AM | TrackBack
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