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After The Storm: Trends To Watch In Russia In 2013

Could a generation gap be emerging in the Kremlin with a disconnect between older cronies of President Vladimir Putin (right) and younger individuals linked with Prime Minister Dmitry Medvedev?
Could a generation gap be emerging in the Kremlin with a disconnect between older cronies of President Vladimir Putin (right) and younger individuals linked with Prime Minister Dmitry Medvedev?
It began with a roar and it ended with a whimper.

As 2012 wound down in Russia, the soaring expectations for change that accompanied the civic awakening and mass protests at the year’s dawn had clearly faded. But the social, economic, and political forces that spawned them will continue to shape the landscape well into the new year.

A fledgling middle class remains hungry for political change, splits still plague the ruling elite over the way forward, and a fractious opposition movement continues to struggle to find its voice.

With the Kremlin unable to decisively squelch the mounting dissent and the opposition unable to topple President Vladimir Putin, Russia has entered an uneasy holding pattern that has the feel of an interlude between two epochs.

"I don't think we are at the end of the Putin era, but we are at the beginning of the end," says longtime Russia-watcher Edward Lucas, international editor of the British weekly "The Economist" and author of the recently published book "Deception."

With economic headwinds on the horizon, generational conflict brewing, and new political forces developing, Russian society is changing -- and changing rapidly. But the political system remains ossified.

So what can we expect in 2013? Below are several trends and issues to keep an eye on in the coming year.

The Oil Curse: Energy Prices And The Creaking Welfare State

If 2012 was all about politics, 2013 will also be about economics.

The Russian economy, the cliche goes, rests on two pillars -- oil and gas. And both will come under increasing pressure as the year unfolds.

World oil prices, currently hovering between $90 and $100 per barrel, are expected to be volatile for the foreseeable future. And any sharp drop could prove catastrophic for the Russian economy.

Energy experts and economists say Russia's budget will only stay balanced if oil prices remain between $100 and $110 per barrel. Five years ago, the figure needed for a balanced budget was $50 to $55.

Meanwhile, Moscow's dominance of the natural gas market is being challenged by the development of new energy sources like shale gas and liquefied natural gas.

"The Russians are going to have to face, just as the Saudis did in the 1980s, the possibility of dropping energy prices," says Nikolas Gvosdev, a professor of national security studies at the U.S. Naval War College.

The flush days when petrodollars could power Russia’s economy and lubricate Putin's political machine are coming to a close.

How the political system responds to these challenges will be a key question in 2013.

Russia's opposition has not really succeeded in building on the mass protests it organized around the country late last year.
Russia's opposition has not really succeeded in building on the mass protests it organized around the country late last year.

Leading Russian economists like Deputy Prime Minister Arkady Dvorkovich and former Finance Minister Aleksei Kudrin have stressed the need to diversify the economy away from its dangerous dependence on nonrenewable energy. Both Putin and Prime Minister Dmitry Medvedev have likewise made calls for diversification.

But despite all the rhetoric, there has been little real action.

Part of this is due to fierce resistance from powerful figures in the Russian elite with ties to the energy industry, like Rosneft CEO Igor Sechin, a longtime Putin crony.

But the reasons for inaction are actually much more fundamental. Diversifying and modernizing Russia's economy would entail a degree of decentralization and the subsequent development of alternative centers of economic power. This, in turn, would eventually lead to new centers of political power with more independence from the Kremlin than Putin appears willing to tolerate.

"The decoupling of gas and oil prices, the large quantities of liquefied natural gas on world markets, the growth of shale gas have all [diminished the regime's] ability to collect natural-resource rents," Edward Lucas says. "And the collection and distribution of those rents is central to its model."

With resources declining and no economic diversification program in sight, the authorities appear to have concluded that they need to reform the country's creaking social-welfare system. But such a move is certain to be politically volatile, especially since Putin's main base of support is now the rural poor and the working classes.

The Kremlin is still haunted by the protests that broke out in 2005 when the government attempted reforms to the social safety net.

Fathers And Children: The Looming Generational Conflict

When Putin took power in 2000, the 40-something former spy looked like an energetic young leader, especially compared to his geriatric predecessor, Boris Yeltsin.

But more than a decade later, he and his team are aging together. And by most accounts, they intend to remain in office at least until 2018 -- and possibly until 2024. By that time, much of his ruling circle will be in their 70s.

The comparisons to Leonid Brezhnev that accompanied Putin's return to the Kremlin were not superfluous. In addition to the fears of stagnation, the graying of Team Putin also sets the stage for a generational conflict within the elite.

"The lack of institutional mechanisms for promotion and rotation is a problem because, when you don't have that, it leads the younger generations to get frustrated if they don't believe there is a way to advance within the system," Gvosdev says. "If everything is blocked off it creates tension. You can't just freeze the government establishment because the energy of people is going to be directed toward breaking into it or replacing it, and that becomes a danger."

How this generational discord develops will be one of the key underlying trends to watch in 2013. This is especially true since a whole new cohort entered the elite over the past four years.

During his presidency, Dmitry Medvedev made a concerted effort to bring younger cadres into the Kremlin, which analysts say added a political element to the generation gap.

"Real fragmentation is taking place by age because Medvedev rejuvenated the system of administration," prominent Moscow-based sociologist Olga Kryshtanovskaya told the daily "Nezavisimaya gazeta" this summer. "The more conservative older part of the elite was irritated by this and moved toward Putin. And those who were younger moved toward Medvedev in hopes of a quick career if Medvedev remained for a second term."

The young guns who came in with Medvedev are also ideologically inclined toward greater pluralism. "Many observers are convinced that these leaders are giving financial support to the opposition," Kryshtanovskaya said.

The generational gap in the elite is mirrored by a similar one in society as the cohort born after the fall of the Soviet Union -- and which has only faint memories of the chaos of the 1990s -- comes of age.

"This group of citizens sees itself as not only post-Soviet, but non-Soviet," says Masha Lipman of the Moscow Carnegie Center. "They don't consider themselves to be vassals of the state. They are more free-thinking."

Lipman adds that this younger generation is helping fuel Russia's civic awakening. "This process is irreversible,” she says. "And as Russia continues to urbanize and cities become centers for younger people, this process will only accelerate."

Former Russian Finance Minister Aleksei Kudrin could be trying to position himself as a bridge between the opposition and the authorities.
Former Russian Finance Minister Aleksei Kudrin could be trying to position himself as a bridge between the opposition and the authorities.
Strange Bedfellows: When Aleksei Meets Aleksei

When speculation emerged that anticorruption blogger Aleksei Navalny and former Finance Minister Aleksei Kudrin may be cooperating politically, it raised eyebrows among Kremlin-watchers.

And the reason for the interest goes much deeper than an abiding fascination with these two emerging players on the political scene.

An alliance of the Alekseis would have pointed to one of the key developments analysts have been watching for since mass protests broke out a year ago: collaboration between the technocratic wing of the elite and moderate elements in the opposition.

Such a marriage makes sense in many ways. Elite technocrats understand that Russia is dangerously dependent on energy exports, that current levels of corruption are unsustainable, and that in order for the economy to diversify and modernize, the political system will need to become more pluralistic.

Moreover, as moderate opposition activists come to understand that a colored revolution in Russia is unlikely, they are more likely to place their hopes in evolutionary change.

And in the event that the Putin regime begins to look dangerously shaky, overtures from inside the halls of power to the opposition will become more likely.

"We are going to see more people toying with defection to the opposition, people opening up back channels," says Mark Galeotti, the author of the blog "In Moscow's Shadows" and a professor at New York University. "We're going to see the economic elite trying to reach out [to the opposition] and this is going to be very dangerous for the state."

On the opposition's Coordinating Council, a bloc is already emerging that seeks to negotiate political change with willing elements in the Kremlin, rather than trying to topple the regime, according to press reports.

The faction apparently includes 16 members of the 45-seat council. In addition to Navalny and his backers, it reportedly includes socialite-turned-activist Ksenia Sobchak and her supporters, as well as longtime opposition figure Ilya Yashin and entrepreneur Aleksandr Vinokurov, the co-owner of Dozhd-TV.

For his part, Kudrin has been trying to position himself as a bridge between the opposition and the authorities to foster what he calls "evolutionary change" toward greater pluralism. So has billionaire oligarch and former presidential candidate Mikhail Prokhorov.

If a bridge is ultimately built between the opposition and the technocratic wing of the elite, it could result in negotiated political reforms, in the co-opting of a vital wing of the Kremlin's opponents -- or a measure of both.

"I think it is more likely that as we see divisions within the regime that one faction tries to exploit public discontent," Lucas says. "It will still be kind of 'inside baseball' rather than a 1917-style change."

Beyond The Street: Will The Opposition Mature?

Bouts of soul searching are an inevitable ritual after the past few opposition demonstrations.

The heady days of December 2011 and January 2012, when dissenters found their voice and discovered they were not alone, are a fading memory. Likewise, the period from the beginning of the year until Putin's return to the Kremlin in May, when the opposition seemed to control the national conversation, is also over.

And opposition leaders look increasingly uncertain about what to do next.

"They're focusing on the glory days, the revolutionary days of December through May. But nobody is thinking about what happened after May, when they lost control of the agenda," says Sean Guillory, a fellow at the University of Pittsburgh's Center for Russian and Eastern European Studies. "How are they going to recapture the agenda and how are they going to really start making connections with society?"

The opposition, of course, is not a unified movement. It comprises nationalists, leftists, and liberals, united only by their opposition to Putin.

Will a single leader emerge in the coming year? Will the Coordinating Council, an elected body designed to bridge the divides in the opposition and establish a bond with civil society, prove an effective form of collective leadership?

"A process we are going to see is the opposition actually beginning to fragment," Galeotti says. "You will begin to see ideological blocs, real opposition movements rather than just the generic 'we want Russia without Putin' thing. But it will be a painful process."

What happens with the opposition, whether it is able to move beyond the street and develop into a potent political force, is a trend to watch because there is a deep well of discontent in society to potentially tap.

"They have this feeling of stagnation," Lucas says. "Of institutions that don't work, of a public life plagued by lies, evasions, and propaganda. They want more decent behavior by public officials and public institutions and they aren't getting it."
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Comment Sorting
Comments
     
by: La Russophobe from: USA
January 03, 2013 07:34
"Bouts of soul searching are an inevitable ritual after the past few opposition demonstrations."

This is just wrong. There is no such soul-searching, and more's the pity. Navalny's movements imply is not holding him accountable for his failure, or even facing the fact that he did fail. It's leadership acts much like the Politburo, insulated from real self analysis and responsibility, and that is one of the most important reasons why it has failed so miserably. The movement does not take criticism any better than Putin himself.

"As 2012 wound down in Russia, the soaring expectations for change that accompanied the civic awakening and mass protests at the year’s dawn had clearly faded."

This is misleading. The only ones who had "soaring expectations" were a tiny group of deluded followers of Navalny and an even tinier group of benighted Western reporters, like Ioffe and Elder and their ilk. People who really knew Russia never thought Navalny's "movement" had an real hope or traction. It's time to start asking why Western Russia correspondents got the movement so very wrong. Part of it may well be their own self interest in whipping up a story within their beat they could sell to the world.

by: Konstantin from: Los Angeles
January 06, 2013 02:38
It isn't "whimper", RFE, but rather wampire!
Russia suck blood for centuries, since Varanga,
Invading Eastern Europe and Russia with "bulyga",
Brakes skuls of nations. Breeding the new Empire,
Instead of only genocide, cleanse-inslave "baryga".

Even in Soviet times Lenin annexed Sochi region,
Georgian part for milleniums, and North Osetia,
Member of Georgia Common Wealth nations.
Now Russia invaded, cleansed - "annexiya"
In Abkhazia and Tchinvali, breed Russians.

Not unlike "Munich Olimpics" Hitler's legacy,
Of aggression and annexation of "Evropas",
Russia even with a more impudent swinery
Do Olimpics in Lenin-annexed part Georgia
And annexing close-by Abkhazia's scenery.

Make it look legal - they inviting for publicity
A famous French actor, "Mosie Buonasie",
To Hail Russia and its evil stolen "Felisety"
Build on death and suffering, for "Reshilie",
Putin and put in Sochi "GRU" cannibalicity.

What a "De-Pardonieu", for millions taxes
Awoided, a "pay-yourself bribe for "kasha",
Legitimize genocides, cleanse and annex!
Why not US? Is his ansestry from Russia
Old zhandarms? Loves end at "parasha"?




In Response

by: Konstantin from: :Los Angeles
January 07, 2013 15:34
PS:

New RFE article say "Musiye Buanasiye" moves to Mordovia.
Great, Mordovians were known for guarding prison camps
For poliical prisoners. They also supplied both Osetias
With part-Russian-Mordva-Osetin Gauliters-wamps
Invade both for Russia. Seek place at "parasha"?

It's what Russia does eventually, stealing wealth,
Than send complaining-disspossest to Mordovia.
On another hand, if "Musiye" is Varagian's belch,
He might agree deliberatly facilitate the "annexia".
Still, he might be a honest guy - believing Russia.

Indeed, another new article prise Russia-merciful
That helping Tuva! If even they help locals people,
Not only influx of Russians - taking us for fools?
Russia annexing land of nations, they cripple.
Sends its Citizens "Gebbels reliefe foods"?

I think "Musie Buanasiye" became a snich,
Helps genocide-annex Russia evil stench,
Use French parfume out-smell the World,
Hide under fume annexing Russian hords.

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17:49

EVENING NEWS ROUNDUP

From RFE/RL's News Desk:

PUTIN ACCUSES UNITED STATES OF 'UNILATERAL DIKTAT'

Russian President Vladimir Putin has accused the United States of escalating conflicts around the world by imposing what he called a "unilateral diktat."

Putin made the remarks in a combative speech to political experts at the Valdai International Discussion Club, in Russia's Black Sea resort of Sochi.

Putin said the United States has been "fighting against the results of its own policy" in Iraq, Libya and Syria.

He said risks of serious conflicts involving major countries have risen, as well as risks of arms treaties being violated.

He also dismissed international sanctions over Russia's actions in Ukraine as a "mistake," saying they aimed at pushing Russia into isolation and would end up "hurting everyone."

We did not start this," he added, referring to rising tensions between Russia and the West.

(Based on reporting by Reuters, AP, Interfax, TASS)

MERKEL URGES PUTIN TO SOLVE UKRAINIAN GAS DISPUTE

German Chancellor Angela Merkel has urged Russian President Vladimir Putin in a telephone call to push for a quick resolution of the ongoing gas dispute with Ukraine as winter looms.

The call by Merkel to Putin on October 24 comes as representatives of the EU, Russia, and Ukraine are due to meet again next week in EU brokered talks aimed at solving the gas dispute between Kyiv and Moscow.

Merkel also underlined that upcoming elections in areas of eastern Ukraine controlled by Russian-backed separatists must respect Ukrainian national law.

Pro-Russian insurgent leaders are boycotting a parliamentary snap poll on October 26 in Ukraine and are holding their own election in the Lugansk and Donetsk regions, home to nearly three million people, on the same day instead.

(Based on reporting by AFP and Reuters)

UNHCR SAYS MORE THAN 800,000 DISPLACED IN UKRAINE CONFLICT

By RFE/RL

The United Nations says the conflict in Ukraine has forced more than 800,000 people from their homes.

Around 95 percent of displaced people come from eastern Ukraine, where government troops have been battling pro-Russian separatists.

UNHCR, the UN refugee agency, told a briefing in Geneva that an estimated 430,000 people were currently displaced within Ukraine -- 170,000 more than at the start of September.

It said at least 387,000 other people have asked for refugee status, temporary asylum, or other forms of residency permits in Russia.

Another 6,600 have applied for asylum in the European Union and 581 in Belarus.

The agency said it was "racing to help some of the most vulnerable displaced people" as winter approaches.

It also said the number of displaced people is expected to rise further due to ongoing fighting in eastern Ukraine.

THREE ALLEGED MILITANTS KILLED IN NORTH CAUCASUS

Three alleged militants have been killed by security forces in Russia's volatile North Caucasus region.

Russia's National Antiterrorism Committee says that two suspects were killed in the village of Charoda in Daghestan on October 24 after they refused to leave an apartment and opened fire at police and security troops.

One police officer was wounded.

Also on October 24, police in another North Caucasus region, Kabardino-Balkaria, killed a suspected militant after he refused to identify himself, threw a grenade towards police, and opened fire with a pistol.

A police officer was wounded in that incident.

Violence is common in Russia's North Caucasus region, which includes the restive republics of Daghestan, Kabardino-Balkaria, Ingushetia, and Chechnya.

Islamic militants and criminal groups routinely target Russian military personnel and local officials.

(Based on reporting by Interfax and TASS)

MOSCOW LAWYER IN HIGH PROFILE ORGANIZED CRIME CASE KILLED

A lawyer, who represented an alleged victim of the notorious Orekhovo criminal group in Moscow, has been assassinated.

Police in the Russian capital say that Vitaly Moiseyev and his wife were found dead with gunshot wounds in a car near Moscow on October 24.

Moiseyev was representing Sergei Zhurba, an alleged victim of the Orekhovo gang and a key witness in a case against one of the gang's leaders Dmitry Belkin.

Belkin was sentenced to life in prison on October 23 for multiple murders and extortion.

Last month, another of Zhurba's lawyers, Tatyana Akimtseva (eds: a woman), was shot dead by unknown individuals.

The Orekhovo group was one of the most powerful crime gangs of the Moscow region and in Russia in the 1990s. Its members are believed to be responsible for dozens of murders.

(Based on reporting by TASS and Interfax)

17:27

LITTLE GREES VOTERS, ANYONE?

17:26

SPY VS. SPY

08:29

MORNING NEWS ROUNDUP

From RFE/RL's News Desk:

UKRAINIAN PM WARNS OF RUSSIAN DESTABILIZATION OF ELECTIONS

Ukrainian Prime Minister Arseniy Yatsenyuk is warning that Russia could attempt to disrupt Ukraine's parliamentary elections scheduled for October 26.

Yatsenyuk told a meeting of top security officials and election monitors on October 23 that "It is absolutely clear that attempts to destabilize the situation will continue and will be provoked by Russia."

Yatsenyuk said "we are in a state of Russian aggression and we have before us one more challenge -- to hold parliamentary elections."

The prime minister said Ukraine needs the "full mobilization of the entire law-enforcement system to prevent violations of the election process and attempts at terrorist acts during the elections."

Interior Minister Arsen Avakov said authorities have ordered some 82,000 policemen on duty for election day.

He said 4,000 members of a special reaction force would be among those maintaining order during polling hours and would be concentrated in "those precincts where there is a risk of some terrorist acts or aggressive actions by some...candidates."

The warning by Yatsenyuk comes on the heels of three violent attacks on parliamentary candidates in the past week.

The latest, against Volodymyr Borysenko, a member of Yatsenyuk's People's Front Party, occurred on October 20 when Borysenko was shot at and had an explosive thrown at him.

He allegedly survived the attack only because he was wearing body armor due to numerous death threats he had recently received.

Elections to the Verkhovna Rada, the parliament, will be held despite continued fighting in the eastern part of the country between Ukrainian government forces and pro-Russian separatists.

Voting will not take place in 14 districts of eastern Ukraine currently under the control of the separatists.

Those separatist-held areas -- in the Donetsk and Luhansk regions -- are planning on holding their own elections in November.

Additionally, Russia's illegal annexation of Crimea in March means the loss of 12 seats from the 450-seat parliament.

Polls show President Petro Poroshenko's party leading with some 30 percent of respondents saying they would cast their vote for the Petro Poroshenko Bloc.

It that percentage holds on election day it would mean Poroshenko's bloc would have to form a coalition government, likely with nationalist groups who oppose conducting peace talks over fighting in the east.

(Based on reporting by Reuters and Interfax)

RUSSIA DENIES ESTONIAN AIRSPACE VIOLATIONS

By RFE/RL

Moscow has denied claims of an incursion by a Russian military plane into Estonia's airspace.

A Russian Defense Ministry spokesman told Interfax news agency on October 23 that the Ilyushin-20 took off from Khrabrovo airfield in the Russian enclave of Kaliningrad on October 21.

The spokesman said the reconnaissance plane flew "over neutral waters of the Baltic Sea" while on a training flight.

On October 22, Estonia’s Foreign Ministry summoned the Russian ambassador in Tallinn, Yury Merzlakov, after the Estonian military said the Russian plane had entered its air space.

In a statement, NATO said the Ilyushin-20 was first intercepted by Danish jets when it approached Denmark, before flying toward non-NATO member Sweden.

Intercepted by Swedish planes, the alliance said the Ilyushin entered Estonian airspace for “less than one minute” and was escorted out by Portuguese jets.

NATO has stepped up its Baltic air patrols and Moscow has been accused of several recent border violations in the region amid heightened tensions between Russia and the West over the Ukraine conflict.

Last month, Estonia accused Russia of abducting one of its police officers on the border.

Russia claims Eston Kohver was seized inside Russia on September 5, while Estonian officials say he was captured at gunpoint in Estonia near the border and taken to Russia.

The European Union and United States have called for the immediate release of the Estonian security official, who is facing espionage charges in Russia.

Meanwhile, the Swedish Navy has been searching for a suspected submarine sighted six days ago some 50 kilometers from the capital, Stockholm, although it said on October 22 it was pulling back some of its ships.

Swedish officials have not linked any particular country to the suspected intrusion and Moscow has denied involvement.

(With reporting by Interfax, TASS, and the BBC)

RUSSIAN COURT POSTPONES RULING ON OIL FIRM BASHNEFT

A Moscow court postponed to next week a ruling on a move to take control of Bashneft, an oil company from tycoon Vladimir Yevtushenkov.

The judge said on October 23 that the next hearing will take place on October 30 after the prosecution requested more time to prepare its case.

Prosecutors filed the suit in September to regain state ownership of Bashneft, citing alleged violations in the privatization and subsequent sale of the company to AFK Sistema investment group.

Yevtushenkov, the main shareholder of the conglomerate, is under house arrest on suspicion of money laundering during the firm's acquisition in 2009.

Yevtushenkov, 66, was arrested on September 16.

He is ranked Russia's 15th richest man by U.S. magazine Forbes, with an estimated fortune of $9 billion.

(Based on reporting by Reuters and TASS)

11:11 October 23, 2014

THERE IS NO RUSSIA WITHOUT PUTIN?

According to a report in the pro-Kremlin daily "Izvestia," deputy Kremlin chief of staff Vyacheslav Volodin told a meeting of the Valdai Discussion Club in Sochi that Western politicians "do not understand the essence of Russia."

"Volodin stated the key thesis about the current state of our country: As long as there is Putin there is Russia. If there is no Putin, there is no Russia," Konstantin Kostin, head of the Foundation for the Development of Civil Society, told "Izvestia."

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The Power Vertical is a blog written especially for Russia wonks and obsessive Kremlin watchers by Brian Whitmore. It covers emerging and developing trends in Russian politics, shining a spotlight on the high-stakes power struggles, machinations, and clashing interests that shape Kremlin policy today. Check out The Power Vertical Facebook page or